1999-04-213912SENATE395701999-04-21The PRESIDENT(Senator the Hon. Margaret Reid) took the chair at 9.30 a.m., and read prayers.Miscellaneous3957Motion (by Senator Ian Campbell) proposed:That the following bills be introduced:A bill for an act to amend the Broadcasting Services Act 1992, and for other purposes.A bill for an act to amend the Copyright Act 1968, and for related purposes.A bill for an act to amend the Migration Act 1958, and for related purposes.09:31:003957O'Brien, Sen KerrySenator O'BRIEN8O6TASALP00—Madam President, we certainly have no problem with the introduction of these bills, but I think this is the appropriate time for me to make a couple of brief points to explain our position in relation to this matter and some other matters that are coming up.In relation to the introduction of the Migration Legislation Amendment (Temporary Safe Haven Visas) Bill 1999 , this was a matter drawn to our attention last night. At that time I indicated that we would grant leave to give notice last night on the basis that, if there were a problem with proceeding with that matter today, it would not be proceeded with. I can indicate that we do not have a problem with the matter proceeding today, having obtained that information this morning.I should say in relation to another matter which is to come up, motion No. 5, that we do have some difficulty. I will be asking that that matter not proceed this morning and that it be adjourned to a later hour in the day so I can get further advice.In relation to item No. 6, the giving up of government documents time to government business, the opposition will be supporting that on the basis that all of these changes are necessitated because the government will not be proceeding beyond the second reading vote in the new tax system GST package today as we were advised, I am instructed, by the Manager of Opposition Business last night. Indeed, we were so advised at the whips' meeting last night.If that clarifies the position, we indicate support for these motions, and certainly for exemption from the cut-off for the Migration Legislation Amendment (Temporary Safe Haven Visas) Bill 1999 today, but we would ask that motion No. 5—which you will no doubt come to—for exemption from the cut-off for the Further 1998 Budget Measures Legislation Amendment (Social Security) Bill 1999 be deferred to a later hour in the day.Question resolved in the affirmative.Bills3957s213Billss215Billss2143957Motion (by Senator Ian Campbell) agreed to:That these bills may proceed without formalities, may be taken together and be now read a first time.Bills read a first time.395709:35:003957Campbell, Sen IanSenator IAN CAMPBELLH15WALP10—I table the explanatory memoranda relating to the bills and move:That these bills be now read a second time.I seek leave to have the second reading speeches incorporated in Hansard.Leave granted.The speeches read as follows—BROADCASTING SERVICES AMENDMENT (ONLINE SERVICES) Bill 1999The Broadcasting Services Amendment (Online Services) Bill 1999 (the bill) will enact a regime which balances the need for the government to meet legitimate community concerns about the publication of illegal and offensive material online, that is commensurate with the regulation of conventional media, while ensuring that regulation does not place onerous or unjustifiable burdens on industry and inhibit the development of the online economy.The main elements of the proposed framework are that:. a complaints mechanism will be established under which any person can complain to the Australian Broadcasting Authority (ABA) about offensive material online;. material that will trigger action by the ABA will be defined, on the basis of current National Classification Board guidelines for film, as material Refused Classification and rated X, and material rated R that is not protected by adult verification procedures;. the ABA will be given powers to issue notices to service providers aimed at preventing access to prohibited material which is subject to a complaint if it is hosted in Australia or, if the material is sourced overseas, to take reasonable steps to prevent access if technically feasible;. indemnities will be provided for service providers to protect them from litigation by customers affected by ABA notices;. a graduated scale of sanctions against service providers breaching ABA notices or the legislation will apply;. the framework will not apply to private or restricted distribution communications such as Intranets or communications not in a stored form; however, current provisions of the Crimes Act 1914 (Cth) in relation to offensive or harassing use of a telecommunications service will apply in this context;. a community advisory body will be established to monitor material, operate a `hotline' to receive complaints about illegal material and pass this information to the ABA and police authorities, and advise the public about options such as filtering software that are available to address concerns about online content;. the Commonwealth will be responsible for regulating the activities of Internet service providers (ISPs) and Internet content hosts (ICHs) and the Attorney-General will encourage the development of uniform State and Territory offence provisions complementing the Commonwealth legislation (including section 85ZE of the Crimes Act) that create offences for the publication and transmission of prohibited material by users and content creators.The use of online services is growing rapidly in Australia. There are now over 650 online service providers providing access to the Internet and other online services. The ABS estimates that more that 3.6 million Australians have accessed the Internet at some time. It is clear that the information accessed through this medium is increasingly influential in the community.The online industry consists of a number of participants. ISPs, who are a type of carriage service provider under the Telecommunications Act 1997, essentially offer access to the Internet and for some this is their only role. Other online service providers offer a range of additional services to clients such as e-mail, file transfer services, network "news" groups and telephony. They may also offer clients world wide web services in which clients' web sites are hosted on the service providers computer systems and are accessible to other users through the Internet and caching services in which sites overseas are mirrored on their service to facilitate speed of access in Australia. ICHs host content for third parties which is available through the Internet but do not provide Internet connectivity to their customers. ISPs and ICHs are generally not aware of the content of the material which is either accessed through, or hosted on, their services unless it is brought to their attention. Often, but not always, ISP and ICH services are provided by the same person.At the end-user level, there are users who access information on the Internet through a service provider and content providers who publish content such as world wide web pages to be accessed by other Internet users, often by putting web pages onto and ICH's hosting computer systems. In a stored form, end-users should be responsible for this content.Concern has been expressed both within the community and at government level about the nature of material that may be accessed by means of online services, specifically in relation to the perceived ease of access to material that is either illegal, pornographic or unsuitable for children.Some State and Territory jurisdictions (Western Australia, Victoria and the Northern Territory) have already enacted offence provisions in relation to content transmitted, accessed or published by means of an online service. The Commonwealth is concerned at the possible regulatory fragmentation of differing State/Territory legislation and the possible adverse effect on the development of the online industry. A further difficulty with some current State/Territory legislation is that it places a degree of prima facie responsibility on service providers for the content transmitted through their service in that the onus is on service providers to prove relevant statutory defences to a Court in relation to alleged offences with the subsequent costs and uncertainty this would create. The bill is intended as part of a multifaceted approach to ensure a uniform national approach to online content regulation with the objectives of:. providing a means for addressing certain complaints about Internet content;. restricting access to certain Internet content that is likely to cause offence to a reasonable adult; and. protecting children from exposure to Internet content that is unsuitable for children.The bill amends the Broadcasting Services Act 1992 (BSA) to provide for the regulation of ISPs and ICHs. Schedule 2 to the bill makes a consequential amendment to the Crimes Act 1914. It will introduce a regulatory framework for ISPs and ICHs and forms part of a two tiered approach to online content regulation in which it is anticipated that the States and Territories will enact complementary legislation creating offences for the publication and transmission of objectionable material by end-users.In relation to proposed uniform State and Territory offence provisions, it is the intention that service providers not be liable for content hosted on, or accessed by means of, a service provider's system where the service provider is not responsible for the creation of the content, or has not committed a "positive act" in relation to that content. The proposed State and Territory legislation will supersede online services specific legislation currently in place in Victoria, Western Australia and the Northern Territory.For the Commonwealth's part in the national regulatory framework, the bill will ensure that ISPs and ICHs are not held liable for content of which they are not aware. However, a complaints mechanism will be established in which any person can complain to the ABA about offensive material online and the ABA will be given powers to issue notices to ISPs and ICHs aimed at preventing access to prohibited material which is subject to a complaint if it is hosted in Australia or, if the content is sourced overseas, to take reasonable steps to prevent access if technically feasible.Prohibited content, that will trigger action by the ABA, is defined in the bill on the basis of current National Classification Board guidelines for film, as material Refused Classification and rated X, and material rated R that is not protected by adult verification procedures.The bill provides for a classification procedure for Internet content that is separate to that applying to conventional media in the Classification (Publications, Films and Computer Games) Act 1995. This is on the basis that the Classification act may not encompass all forms of Internet content. The Classification Board will however be required to classify Internet content subject to complaint in a way that corresponds to the way in which a film would be classified under the Classification act, that is, in relation to the classification criteria that apply in relation to RC, X and R classifications.Internet content is defined as information that is stored and that is accessible to the public. Restricted access systems such as Intranets are excluded. Ephemeral content, such as newsgroups, chat rooms and real time services such as streaming video and audio, is also excluded, except to the extent that they are stored or archived, given that it would not be possible to classify "live" material. However, this content will continue to be subject to s.85ZE of the Crimes act that provides for an offence for the knowing or reckless use of a carriage service in a manner which would cause offence to a reasonable adult in all the circumstances. The bill amends the Crimes act to put its application in this regard beyond doubt.There is no specific exclusion of e-mail in a stored form. This reflects the difficulty of defining one-to-one e-mail separately from e-mail with wider distribution. However, for practical purposes one-to-one e-mail is highly unlikely to come to the attention of the ABA in practice because of the private and usually password protected nature of the communication. In the unlikely event of a compliant about a private e-mail, the only action the ABA could take would be to order it taken down.ComplaintsThe cornerstone of the regulatory framework is the complaints mechanism in Part 4 of the bill. This will allow the ABA to take timely action to investigate complaints from the public and notify ISPs to prevent access to prohibited content. The bill provides that complaints can be made by Australian residents about prohibited content carried or hosted by ISPs and ICHs and breaches of industry codes, industry standards and online provider rules directly to the ABA.A process for direct complaints to the ABA recognises that material subject to a complaint will not generally be originated by the ISP or ICH and that it would be unreasonable to expect them to adjudicate complaints about material for which they are not responsible or make judgements about whether particular material is prohibited. It will provide certainty for the industry in that their responsibilities in relation to complaints will be limited to complying with ABA notices to prevent access to content.Complaints will not be able to be made about something that occurs before 1 January 2000. This is intended to afford ISPs and ICHs an opportunity to put arrangements in place to enable them to avoid contravening the regulatory regime proposed in the bill and to enable the ABA to ensure that it is in a position to deal with complaints.Persons making complaints in good faith or giving information to the ABA in connection with an investigation of a complaint will be immune from civil proceedings (such as proceedings for breach of contract in relation to the disclosure of a password or proceedings for defamation).The bill requires the ABA to investigate all complaints unless it is satisfied that the complaint is frivolous, vexatious or not made in good faith or has reason to believe that the complaint was made for the purpose of frustrating or undermining the effective administration of the proposed regulatory framework. However, in cases of extreme concern, for example paedophiles circulating illegal material online or the enticement or exploitation of children for illegal purposes through the use of online services, it is possible that a police investigation may be concurrent with a complaint to the ABA about particular material. The public nature of the ABA complaints and investigation process proposed in the bill could prejudice a police investigation in these circumstances. As a safeguard, therefore, the bill gives the ABA a discretion to defer action where a member of the Federal, State or Territory police satisfies the ABA that an investigation should be deferred for a specified period.The ABA will be able to initiate investigations on its own initiative. It is not intended that this discretion will be used by the ABA to monitor content actively. It will instead provide a mechanism to allow the ABA to investigate matters where, for example, information about particular Internet content or the conduct of an ISP or ICH is drawn to its attention by a source other than a complaint from the public. For example, an additional function of the ABA under the bill will be to liaise with regulatory and other relevant bodies overseas, such as police authorities and `hotline' complaints services like the UK Internet Watch Foundation about co-operative arrangements for the Internet industry. Arrangements could include information sharing arrangements and the ABA will therefore need to be able to act on any such information received. This discretion will also improve the ABA's ability to deal with avoidance situations.If in the course of an investigation, the ABA is satisfied that Internet content hosted in Australia is prohibited content, the ABA will be required to give the relevant Internet content host a written notice directing the host not to host the prohibited content. This notice is called a final take-down notice and is intended to have ongoing effect. The ABA's decision will be based on a classification of the Classification Board.If the ABA is satisfied that, if the Internet content were to be classified by the Classification Board, there is a substantial likelihood that the Internet content would be classified RC or X, the ABA will be required to give the relevant Internet content host an interim take-down notice directing the host not to host the Internet content until the ABA notifies the host of the Classification Board's classification of the Internet content and request the Classification Board to classify the Internet content.Interim take-down notices have been limited to RC and X-rated content rather than R-rated content (without adult verification) because of the generally less serious nature of R-rated material. If interim take-down notices were to apply to R-rated material, this would be likely to increase greatly the ABA's administrative costs under the existing classification scheme in which the Classification Board charges fees on a cost recovery basis. It would also increase industry's compliance costs. However, the ABA must seek a classification from the Classification Board for R-rated material.The ABA will be able to revoke notices if, for example, the relevant content is reclassified.As an anti-avoidance measure, the bill provides that the ABA will be able to make take-down notices directing ISPs and ICHs to prevent access to content that is substantially similar to content specified in a previous interim or final take-down notice where the ABA is satisfied that this similar content is or would be prohibited. This addresses the scenario in which there is avoidance of a notice to an ISP or ICH to take-down prohibited content through modification of the content so that the description of the content in the notice is no longer enforceable. The ease with which online content can be modified (or moved or disguised) compared to conventional content makes this scenario a serious possible impediment to effective enforcement of the regulatory framework. It would also add to regulatory costs because, where the ABA identified content modified so as to avoid the effect of a take-down notice, it would then need to initiate the process required to institute a new take-down notice in relation to the modified content, including seeking a new classification from the Classification Board. The use of the term `substantially similar' is intended to convey the idea that the content must be similar in substance to content about which the Classification Board's notice expressed concerns. For example, if a picture hosted on a web site were classified because a particular part or aspect of the picture was offensive, then the ABA's focus in using this provision would be on whether that concern about the picture had been addressed.In relation to investigation of complaints about Internet content hosted overseas determined to be prohibited content or potential prohibited content, the ABA will be required to notify Australian police authorities if the ABA considers the content is of a sufficiently serious nature. The ABA will be able to notify overseas regulatory and other bodies directly, such as hot line services, if it is authorised to do so under arrangements with Australian police.If an industry code or industry standard deals with procedures which Internet service providers will follow in dealing with overseas hosted Internet content notified by the ABA, the ABA must also notify the content to Internet service providers. As a transitional default provision, the bill provides that if there is no code or standard dealing with procedures in relation to notified overseas hosted content, the ABA must give each Internet service provider known to the ABA a written notice directing the provider to take all reasonable steps to prevent end-users from accessing the content. In determining whether particular steps are reasonable for this purpose, the ABA will be required to have regard of to the regulatory policy of the bill set out in clause 4, particularly that regulation should be in a manner that enables public interest considerations to be addressed in a way that does not impose unnecessary financial and administrative burdens on ISPs and ICHs. The government does not propose to mandate any particular technological solutions to filtering overseas sourced material.ISPs and ICHs will be protected from civil proceedings (for example breach of contract or defamation) in relation to actions taken to comply with ABA notices.Co-regulationWithin this overarching complaints mechanism to deal directly with prohibited content, the bill takes a co-regulatory approach in which three interdependent levels of regulation apply. The government considers that this approach will best utilise industry expertise in the development of workable and practical codes of practice, with which compliance is more likely, while ensuring there is a legal framework to deal with any irresponsible industry behaviour. Therefore, the first level of regulation is self-regulatory in which the industry will have the opportunity to develop its own procedures in codes of practice that are responsive to community concerns and assist members of the community to manage their, and their children's use, of the Internet. At the second level, the ABA will be able to intervene by directing compliance with industry codes or, if necessary, determining standards in relation to matters that would be dealt with by codes where codes of practice are not developed by the industry or are deficient or fail. At the third level, generic service provider rules will apply to the whole industry and will underpin compliance and enforcement of the regulatory framework, including the complaints mechanism.Codes of PracticeIn relation to industry codes of practice, ISPs and ICHs will each be expected to develop a single code dealing with matters specified in clause 56 of the bill such as procedures directed towards the achievement of the objective of ensuring that online accounts are not provided to children without the consent of a parent or responsible adult, procedures to be followed in order to assist parents and responsible adults to supervise and control children's access to Internet content and the procedures to be followed in order to inform producers of Internet content about their legal responsibilities in relation to that content. The Codes specifically exclude matters that are covered codes of practice developed under other relevant legislation, such as the Telecommunications act. However, there is no impediment to these other matters being dealt with in a single document, as long as the document makes clear which "module" deals with the requirements of specified legislation and the regulatory body which has registered that module.ISPs will also be expected to develop a code setting procedures to be followed in dealing with overseas hosted Internet content notified to them by the ABA, for example, procedures to be followed by a particular class of Internet service providers for the filtering, by technical means, of such content. This code must also set out the means by which the ABA will been taken to have notified ISPs, given that since the notified overseas content will be accessible through all ISPs in Australia, it may be necessary to have a well-understood procedure for notification at a single point, for example, a secure web site.In this respect, it is important to emphasis that the bill does not mandate any particular technological solutions to filtering notified overseas sourced material. Rather, it gives ISPs the opportunity to develop their own procedures to follow to prevent access to sites which the ABA considers would be regarded as highly objectionable or illegal (RC or X) under Australian classification standards. These procedures would take account of technical limitations and cost considerations. However, if the industry is unable or unwilling to develop such procedures itself, or if the procedures are deficient, the ABA will have the ability to make a mandatory industry standard. The minister will also have the ability to direct the ABA to determine an industry standard if an ABA request to a relevant industry body or association to make an industry code is not complied with.Codes will be registered by the ABA if it is satisfied that the code provides appropriate community safeguards, there has been adequate industry and public consultation and a body designated by the minister has been consulted in the development of the code. This latter body will be a community advisory body to be established, which will also monitor material, operate a `hotline' to receive complaints about illegal material and pass this information to the ABA and police authorities, and advise the public about options such as filtering software that are available to address concerns about online content.The bill provides for a formal trigger for the development of an industry code through the power of the ABA to request a body or association representing a section of the industry to develop a code that would apply to participants of the section dealing with one or more specified matters. The ABA will not be permitted to make such a request unless it is satisfied that the development of the code is necessary or convenient to provide appropriate community safeguards and it is unlikely that an industry code would be developed within a reasonable period without such a request.ABA standardsThe bill intends that the next level of regulation, ABA standards, will come into play where an industry code is not in place, is deficient or has partially or wholly failed or the ABA has requested an industry body to develop a code and it has failed to do so. Standards must relate to the same criteria as specified in the bill for codes of practice. The intention is that an industry section has had an appropriate opportunity to develop its own procedures in this regard through the development of a code before regulatory intervention by the ABA. Standards will be disallowable instruments and the minister will be able to give the ABA directions as to the exercise of its standard making powers.Before determining a standard must seek public comment on a draft of the standard and consult with the community body to be established by the minister. The ABA is to maintain a public register of both codes and standards to provide industry and the public with ready information about codes and standards in force.While the bill will commence upon Royal Assent, as a transitional measure, the bill recognises that development of industry codes of practice (or ABA standards if a code is not developed by the industry) require lead time. While some industry groups are well advanced in code development, these codes will need substantial modification to meet the requirements of the bill. This is particularly the case in relation to the requirement that a code is developed for procedures to be followed for notified overseas hosted content. It is therefore proposed to treat codes for procedures for overseas hosted content separately.The bill requires the ABA to make reasonable efforts to ensure that either an industry code is registered by 1 January 2000 or, if a code is not registered, an ABA standard is in place by 31 March 2000. The later date for possible determination of an ABA standard is intended to reflect the co-regulatory intent of the bill in which industry is given to opportunity to develop its own procedures before any regulatory intervention by the ABA.In relation to notified overseas-hosted content, the bill provides that a separate industry code is to be developed, but that until such a code is registered, ISPs will be required in the legislation to take all reasonable steps to prevent access to it. The broad nature of this requirement pending registration of a code and the possible consequent uncertainty of interpretation is intended to encourage industry to develop detailed procedures in a code for overseas hosted content quickly.Online service provider rulesAt the final level of regulation in the framework, the bill sets out online service provider rules applying to all ISPs and ICHs. These require:an ICH to comply with any interim take-down notice, final take-down notice or special take-down notice that applies to the host as soon as practicable, and in any event within 24 hours, after the notice was given to the host;an ICH to comply with an undertaking given to, and accepted by, the ABA in relation to content subject to an interim notice that the ICH has ceased to host or prevented access to on an ongoing basis prior to a classification by the Classification Board;an ISP to comply with any standard access-prevention notice in relation to overseas hosted content or any special access-prevention notice in relation to notified material that has been modified to avoid the effect of a notice that applies to the provider as soon as practicable, and in any event within 24 hours, after the notice was given to the provider;a participant in a particular section of the Internet industry that has contravened, or is contravening, a relevant registered industry code to comply with any ABA direction to comply with the code;participants in a particular section of the Internet industry to comply with any ABA standard; andcompliance by ISPs and ICHs with any online service provider rules determined by the ABA.Enforcement and sanctionsThe bill includes a graduated range of enforcement mechanisms and sanctions that are intended to allow flexibility in dealing with breaches depending on the seriousness of the circumstances.Codes of practice developed by the industry can be expected to include compliance mechanisms, such as withdrawal of industry association rights or privileges, and compliance incentives, such as the right to display compliance symbols, administered by the relevant oversighting industry body. Such mechanisms will need to be approved by the ABA through the code registration process.At the second level, in relation to breaches of codes, standards and rules, the ABA will be able to make formal warnings to indicate its concerns before taking other action. This might be appropriate where a beach for example was inadvertent or there were other extenuating circumstances.At the next level, the ABA will be able to take intermediate action, for example, directing an ISP or ICH to comply with a code of practice. Failure to comply with this or failure to comply with a take-down notice arising from an ABA investigation could lead to more serious sanctions. Contravention of online service provider rules (which require ISPs and ICHs to comply with ABA notices and directions) will be a criminal offence and a continuing offence for each day the contravention continues. Penalties are $5,500 for an individual and $27,500 for a corporation.In cases of serious, flagrant or recurring breaches of online service provider rules, the ABA will be able to apply to the Federal Court for an order that an ISP cease providing a service or an ICH cease hosting content. This is intended as an extreme last resort measure which it could be expected would be rarely, if ever, required.State and Territory legislationAs noted above, proposed Internet specific State and Territory legislation will apply to ISPs and ICHs only to the extent that they act as content creators. Clause 87 of the bill gives effect to this principle so that State and Territory legislation or a rule of common law or equity will have no effect to the extent to which it subjects an ICH or ISP to civil or criminal liability in respect of hosting or carrying content in a case where the host or provider was not aware of the nature of the Internet content or requires an ICH or ISP to make inquiries about, or keep records of, Internet content hosted by the host or carried by the provider. The minister will also have a power to exempt a State or Territory law from the operation of this provision and to declare that a specified State or Territory law has no effect to the extent to which the law has an effect on an ISP or ICH. This is intended to allow the fine tuning of the limitation of ISP and ICH liability under State and Territory laws.However, the bill also ensures, that other than in respect of this limitation in relation to ICHs and ISPs, State and Territory laws, such as laws of general application like crimes and censorship legislation, operate concurrently with the bill. The amendment of the Commonwealth Crimes Act in Schedule 2 of the bill also make it clear that it is not intended to limit or exclude the concurrent operation of any law of a State or Territory.ConclusionThe government acknowledges that the unique characteristics and rapidly changing nature of the Internet present specific difficulties for regulation of Internet content. It recognises that there are technical difficulties with blocking all illegal and offensive material that is hosted overseas but considers that where it is technically feasible and cost effective to block material this should be done. It is not acceptable to make no attempt at all on the basis that it may be difficult. Nor is it acceptable that community standards applicable to conventional media do not apply to the Internet—what is illegal or controlled offline should also be illegal or controlled online.Recognising these difficulties, the government's approach does not rely on regulation alone. The government, along with the community advisory body and its hotline service, will be encouraging parents and educators to become better aware of means and tools to manage the use of online services by minors. It will also encourage the development of content labelling by Australian content creators and development of labelling standards and encourage service providers to offer a choice for consumers to subscribe to services that allow access to a cache of permitted material only or services that are filtered by the service provider on a best efforts basis. The government will also actively pursue collaborative arrangements internationally in relation to online content codes of practice and online labelling of content. The ABA and the community advisory body will also be encouraged to develop information sharing and other collaborative arrangements with equivalent bodies overseas.As part of this multifaceted approach, the bill will ensure that there is regulatory means to assist with the control of Internet content that is illegal or harmful to children. It does not attempt to place primary onus on ISPs and ICHs who are not responsible for content, gives them certainty in relation to action to be taken when made aware of prohibited content and encourages the industry to develop its own procedures responsive to the community.The government is confident that the bill, and its overall approach to assist individuals to manage their, and their children's use of the Internet strikes the right balance between ensuring industry development is not stifled by overzealous laws or inconsistent or unpredictable regimes or which result in Australia's economic marginalisation, while also responding to the needs and interests of the community.COPYRIGHT AMENDMENT (COMPUTER PROGRAMS) BILL 1999This bill makes a number of changes to the Copyright Act 1968 which are of great importance to the development of the information economy in Australia. The changes will promote open systems, or "interoperability" of computer programs and products, and facilitate error-correction and more effective security of computer systems.The information economy arises from the revolutionary new opportunities for storage, transmission and accessing information made possible by digital technology. The digitising of information is entirely dependent on processing by computers. Computers consist of the software or computer programs for the various digital processes and the computer hardware by which people can manipulate the programs. Even in that very generalised description, the vital role of computer programs in the whole of the new information economy can be easily perceived.With the enormous proliferation of computers and computer technology and the networks connecting them, notably the Internet, there is an obvious need for computers and the programs which drive them to communicate, connect or "interoperate" with each other. When making a new program to interoperate with existing programs, a software developer needs certain information—called "interface specifications"—relating to these existing programs. Often the makers of widely-used programs have made the interface information available in the interests of interoperability. However, sometimes they have not.Computer programs are a form of intellectual property protected by copyright. Since 1984, the Copyright Act has explicitly protected computer programs as literary works, whether they be in human-readable language, called "source code", or in machine-readable language, called "object code", which is the usual form in which they are sold or supplied to users. However, unlike most, if not all, other literary works, computer programs in machine-readable form cannot be rendered in human-readable form without making a copy. The making of a copy of a copyright work without the copyright owner's permission is an infringement of copyright.If one wants to write a literary work to complement an existing work, for instance, a learned commentary on a popular novel, one is free to read the novel in order to write that commentary, without infringing the rights of the owner of copyright in the novel. However, one cannot learn how a computer program in machine-readable form works without access to a version in human-readable form, or source code. To render the machine code into the equivalent of source code, it is necessary to employ a process called "decompilation", which involves the production of a copy of the program.By refusing to make available information about a computer program's interfaces with other programs with which it interoperates, the owner of copyright in a successful program can control the market in products that are interoperable with the program. Only if the maker of a new product were permitted to find out the interface information by decompilation can that maker achieve interoperability of the new program with the existing program.The law of the leading software producing country in the world, the United States, allows makers of new programs to use decompilation to find out the interface information of existing programs for achieving interoperability. The countries of the European Union, and other European countries, also allow this to be done. However, Australian law does not make such provision.The present situation, therefore, is that Australian law is more restrictive of the activities of new software developers than the law of the leading industrialised countries where most of the world's software is being produced. Australia's software producers are recognised as innovative by world standards. Because our industry is not of a scale to compete across the board with such dominant industries as that of the United States, its comparative advantage lies in the ability to cater for niche markets. In order to do this, it must be able to ensure that its successful niche products interoperate with other existing products, including those produced by the big scale producers.Against that background, I come now to the main reform in the bill. If Australian industry is to be allowed to compete on level terms with producers of similar products in the USA and Europe, Australian software copyright law must be brought more into line with the law in those countries. Accordingly, as an exception to the copyright reproduction right, where interface information about other programs is not readily available to a software producer, the producer will now be able to decompile another program to the extent necessary to get the required interface information for making an interoperable product.The government recognises that commercially successful computer programs can involve very extensive expenditure on research and development, and accepts that appropriate protection via the copyright law should be afforded this investment. Accordingly, the change to allow decompilation in the circumstances I have described will ensure that only interface information may be discovered, and that this information may be used only for the purpose of making an interoperable product.This limited sanctioning of decompilation will not weaken the existing proscription of software piracy. The most saleable pirate product is one that is practically indistinguishable from, and functions identically to, the genuine article. To make such a pirate product, one would not decompile the original, but would simply copy it straight onto a disk. In approving these amendments, the government had the benefit of very comprehensive consideration and research going back a number of years and extensive consultations with the software industry. The amendments are based on recommendations contained in a very thorough report by the Copyright Law Review Committee of this government. Because Australia has extensive international obligations in regard to copyright through membership of the World Trade Organisation and other international treaties, careful consideration has also been given to ensuring that the amendments are compatible with those obligations.The bill will also make two other amendments to software copyright law that are very necessary and important for the sound and secure development of the information economy. One of these amendments will allow the use of the decompilation process for the correction of errors in a program where an error-free copy of the program is not reasonably available at a commercial price. Where, because of the Year 2000 date problem, a copy of a program will not function beyond the end of this year, although it was intended to by the producer, decompilation will be able to be undertaken to correct the problem if an error-free version is not reasonably available, as already indicated. This is another element of the government's decisive action to facilitate the combating of the Y2K problem.The other amendment will permit decompilation, where necessary, to test the security of a computer program or of a network of which it is part, against unauthorised access to the program or network and against sabotage—for example, by viruses. The disruption caused by the Melissa virus infecting e-mail systems in Australia and other countries recently is a timely warning of this danger. With our growing dependence on computer networks, the need is correspondingly greater for effective security against unauthorised penetration and sabotage—and all the damage and invasion of privacy that they can cause. Again, the permitted decompilation could only be undertaken if the required information for security testing was not already available, and only to the extent necessary to obtain the information. In the case of both error-correction and security testing, the information gained from permitted decompilation may be used only for the purposes for which the decompilation was undertaken.Madam President, any exceptions to the basic copyright right to control reproduction of a copyright work must be justifiable, must not harm the economic interests of the copyright owner and must be compatible with our international obligations. I have shown that the three very specific cases in which decompilation will be allowed are of fundamental importance to the well-being of the software industry and users of software. The exceptions will in no way make the practice of piracy any easier in Australia, for the simple reason that the changes will not relax in any way the civil or criminal liability of those who engage in piracy. The government believes that, by bringing Australian law essentially into line with the law in the USA and European countries, not to mention other countries in the world, the amendments comply with our international obligations in regard to copyright protection.These are the main amendments contained in the bill. The other amendments implement more technical changes to the protection of computer programs that were recommended in the report of the Copyright Law Review Committee to which I have referred. One amendment confirms that, where the conditions of purchase of a computer program do not specifically provide, the technical generation of a copy of the program in the course of running it for normal use will not infringe copyright in the program. Likewise, the generation of such a temporary copy while running the program in the course of studying its operation will not infringe copyright. The existing provisions of the act permitting the making of a reserve—or back-up—copy against possible destruction of a program have been modified, to make them accord with current practice in the backing-up of computers and computer systems.In further recognition of the critical importance of addressing the Y2K problem, when announcing approval of the amendments on 23 February last the government indicated that the amendment to allow decompilation of computer programs to correct errors would, when enacted, operate as from the date of the announcement. The relevant provision of the bill provides accordingly.One other important provision in the bill will nullify any agreement that purports to exclude the right to run a program in order to study it, the right to make back-up copies or the right to decompile a program for interoperability, for error-correction and for security testing. However, a back-up copy will not be able to be made if it would involve circumventing a "lock" on a computer program incorporated by the producer to prevent such copies being made.Madam President, computer software is the cornerstone of the new communications systems. It is also essential to just about every other element of modern infrastructure, production and services. It is important that the intellectual property in computer programs be adequately protected. With one of the lowest rates of software piracy in the world, Australia has demonstrated its commitment to doing so. However, protection must not be at the cost of reasonable access akin to what users of other copyright materials enjoy. The main amendments in this bill will allow access to source-code equivalent in circumstances in which software engineers in many other software-producing countries already enjoy it. The changes will contribute to competitive development of new software and hardware products, intensifying action against the Y2K bug and increasing the security of systems against viruses and hacking—all indisputably desirable objectives. The amendments will give not one crumb of comfort to software pirates.I commend the bill to the Senate.MIGRATION LEGISLATION AMENDMENT (TEMPORARY SAFE HAVEN VISAS) BILL 1999On 6 April 1999 the Prime Minister announced the government's decision to provide temporary safe haven to 4,000 persons displaced from the Kosovo region of the Republic of Yugoslavia. This was in response to a global appeal by the United Nations High Commissioner for Refugees for countries beyond the immediate region to make an exception and provide emergency shelter to Kosovo Albanians forcibly displaced from Kosovo. The appeal was made to ease the immediate crisis of having over half a million Kosovars forced into neighbouring states. Honourable Senators would agree that the events in Kosovo are a terrible human tragedy.The Commonwealth and State governments and various organisations throughout Australia have moved swiftly to put safe haven arrangements in place. These arrangements include the positioning of a task force of immigration officers, medical personnel, interpreters, and an information technology expert in the Former Yugoslav Republic of Macedonia. Members of the task force are providing valuable assistance to UNHCR and other agencies working in the area. In Australia, defence establishments have been prepared to receive displaced persons and a range of Federal and State agencies are co-operating to provide for the needs of safe haven recipients.I should also mention that there has been a tremendous response from both individuals and businesses throughout Australia offering assistance.The UNHCR subsequently called for a pause of the immediate uplift of persons for temporary protection to countries a considerable distance from Kosovo, while UNHCR re-examined the options available for temporary protection closer to the region.Australia remains committed to its promise and is ready to implement the uplift at short notice if required. With this bill the government is putting in place the legal framework to respond immediate ly, if and when UNHCR re-activates its request to assist in a temporary protection capacity.This bill is an integral part of the larger scale co-operative effort between federal government agencies; between the federal government and state/territory governments; and between all of levels of government and NGOs, to put in place the infrastructure and assistance to help Kosovo Albanians who are to be provided with emergency temporary relief. Together with changes made to the Migration Regulations on 15 April 1999, it will provide the statutory framework for the effective management and return of persons to whom temporary safe haven is provided.This short term humanitarian measure will assist in alleviating the massive suffering and human tragedy that has developed in Kosovo. This is in addition to our commitment to work with UNHCR to assist through permanent resettlement those people who may not be able to return to Kosovo. The emergency temporary protection we are offering with the safe haven is another example of Australia's proven commitment to upholding its international reputation in contributing in the spirit of international burden sharing.The bill amends the Migration Act 1958 to ensure that persons to whom temporary safe haven is provided are unable to apply for any other form of visa, including protection visas, while in Australia. Any applications made by such persons for other types of visas from 6 April 1999 will be rendered invalid. This will ensure that the government can meet its commitment to provide temporary safe haven and also effectively maintain the integrity of Australia's migration and humanitarian programs. Temporary safe haven is not to be used as a means of obtaining permanent residence in Australia.However, the bill will provide the minister with a non-compellable power to allow a particular non-citizen who holds a temporary safe haven visa, or who has not left Australia since ceasing to hold such a visa, to make a valid visa application for another type of visa. This will only be exercised where the minister believes it is in the public interest to do so in exceptional circumstances on a case by case basis. This power may only be exercised by the minister personally.As temporary safe haven is to be provided to persons at short notice and in situations where extensive character checking is not possible, it is necessary to have effective powers to withdraw temporary safe haven which has been provided to any person who represents a danger to the Australian community, or Australia's security or whose presence in Australia would be harmful to Australia's international relations. This power is exercisable only by the minister personally, and allows the minister to refuse to grant, or to cancel a visa without prior notice. Where the minister uses this power, the minister must table a statement about its use in both houses of the Parliament.Any decision to refuse to grant or to cancel a temporary safe haven visa under this special power will automatically apply to members of the immediate family of that person.I reiterate that it remains the government's intention to provide a temporary safe haven in Australia for 4000 Kosovo Albanians. The arrangements that have been made to date demonstrate our commitment to join with other members of the international community to assist in this humanitarian crisis by providing emergency temporary relief. Passage of the bill without delay is essential to enable Australia to grant this relief, while also maintaining the effective management and control of Australia's immigration and entry requirements.I commend the bill to the Senate.Ordered that further consideration of the second reading of these bills be adjourned till the first day of the winter sittings 1999, in accordance with standing order 111.Ordered that the bills be listed on the Notice Paper as separate orders of the day.Business39673967Motion (by Senator Ian Campbell, at the request of Senator Tambling) agreed to:That the provisions of paragraphs (5) to (7) of standing order 111 not apply to the Migration Legislation Amendment (Temporary Safe Haven Visas) Bill 1999, allowing it to be considered during this period of sittings.Motion (by Senator Ian Campbell) agreed to:That government business notice of motion no. 5 standing in the name of the Parliamentary Secretary to the Minister for Health and Aged Care (Senator Tambling) for today, relating to the consideration of legislation, be postponed till a later hour.3967Motion (by Senator Ian Campbell, at the request of Senator Tambling) agreed to:That consideration of business on Wednesday, 21 April 1999, continue from 6.50 p.m. till 7.20 p.m. Bills3968r703Billsr667Billsr666Billsr702Billsr699Billsr698Billsr664Billsr660Billsr658Billsr657Billsr701Billsr663Billsr659Billsr700Billsr661Bills3968r754Billsr755Billsr761Billsr765Billsr763Billsr764Billsr757Billsr760Billsr758Billsr759Billsr756Billsr7623968Debate resumed from 20 April on motions by Senator Ian Campbell, Senator Ian Macdonald and Senator Patterson:That these bills be now read a second time. upon which Senator Cook moved by way of amendment in respect of A New Tax System (Goods and Services Tax) Bill 1998 :Omit all words after "That", substitute:"the Senate condemns the Government for:(a) seeking to introduce a GST which is an unnecessary, unfair, job destroying tax which discriminates against low and middle income earners, the aged and families;(b) putting at risk the low inflation environment delivered by Labor by proposing to introduce an inflationary GST which will put at risk the low interest rates made possible by low inflation; and(c) placing a higher priority on imposing a GST on Australian families that will make the tax system less equitable, rather than addressing tax avoidance loopholes, which would improve the equity of the tax system".and upon which Senator Margetts moved by way of amendment in respect of A New Tax System (Wine Equalisation Tax) Bill 1999 :At the end of the motion, add:"but that the Senate:(a) notes: (i) that cask wine is a category 1 cause of alcohol abuse, with alcohol abuse: (a) costing taxpayers $4.7 billion annually; (b) contributing to more than 3,700 alcohol-related deaths annually; (c) contributing to 730,000 hospital bed-days; and (d) being a prime cause of human distress, through health problems, serious accidents, family breakdowns, unemployment and alcohol related offences; (ii) that a study commissioned by the Department of Health and Family Services in 1995 estimated that alcohol is associated with: (a) 44 per cent of fire injuries; (b) 34 per cent of falls and drownings; (c) 30 per cent of car accidents; (d) 50 per cent of assaults; (e) 16 per cent of child abuse; (f) 12 per cent of suicides; and (g) 10 per cent of machine accidents; and (iii) that aboriginal people in Australia experience significantly higher rates of alcohol-related illness such as alcoholic cardiomyopathy, alcoholic gastritis and alcohol liver cirrhosis as well as traumatic inju ries, road accidents, suicide and violent death than do non-aboriginal Australians;(b) expresses major concern: (i) that the current taxation arrangements in relation to wine have an adverse effect on public health, safety and order; (ii) the Government's proposal for a price-based wine equalisation tax (WET) will perpetuate the anomalies in the present system which result in cheap cask wine being taxed at one fifth of the level applied to low alcohol beers; and (iii) the Government's WET proposal will not address this wide range of social concerns associated with alcohol abuse; and(c) considers that it is only by taxing alcohol content that incentives can be introduced to produce lower alcohol, less toxic beverages".and upon which Senator Brown moved by way of amendment in respect of A New Tax System (Goods and Services Tax Transition) Bill 1998 :At the end of the motion, add:"but that the Senate:(a) notes that the Government's proposed $3.5 billion reduction in taxes on diesel will result in: (i) increased greenhouse gas emissions; (ii) increased air pollution, especially in urban areas; (iii) reduced markets for solar and wind energy; (iv) the demise of the oil recycling industry; and (v) contraction of gas-fuelled transport; and(b) considers that taxes on diesel for road transport should not be cut".and upon which Senator Brown moved by way of amendment in respect of A New Tax System (Australian Business Number) Bill 1998 :At the end of the motion, add:"but that the Senate considers it wrong to impose new taxes on not-for-profit community groups working in the public interest".and upon which Senator Mackay moved by way of amendment in respect of A New Tax System (Commonwealth-State Financial Arrangements—Consequential Provisions) Bill 1999 :At the end of the motion, add: "but the Senate condemns the Government for seeking to end the 25 year Commonwealth-local government funding partnership because:(a) it is a regressive step that fails to recognise local government as an important sphere of government in Australia, a partner of the Commonwealth, and as a fundamental contributor to the wellbeing of the community;(b) it places the future of many councils and the vital services and facilities they provide to their communities, particularly those in rural and regional Australia, at risk;(c) it signals the abandoning of a national approach to standards for local government; and(d) it has been universally and strongly rejected by local government in Australia"and upon which Senator Carr moved by way of amendment in respect of further bills:A New Tax System (Personal Income Tax Cuts) Bill 1998At the end of the motion, add:"but that the Senate condemns the Government for:(a) unfair tax cuts, with more than 50 per cent of the benefits going to the top 20 per cent of income earners;(b) tax cuts for higher income earners which far outweigh the increases in social security payments for lower income earners; and(c) creating a situation where a couple with no children earning $100,000 gets 5 times the benefit of a low single income family with three children".A New Tax System (Compensation Measures Legislation Amendment) Bill 1998At the end of the motion, add:"but that the Senate condemns the Government for:(a) a so-called compensation model for aged pensioners which will erode to nothing within a few years;(b) imposing a GST on veterans and proposing a so-called compensation package which will also erode to nothing in a few years; and(c) this massive sleight of hand at the expense of our aged and veteran pensioners".A New Tax System (Bonuses for Older Australians) Bill 1998At the end of the motion, add:"but that the Senate condemns: (a) the GST, which is effectively a retrospective tax on retirees, who have paid tax on their incomes and now face a new tax on their savings; and(b) the proposed savings bonus, which the Australian Investors' Association has described as `so trifling as to be laughable'".A New Tax System (Trade Practices Amendment) Bill 1999At the end of the motion, add:"but that the Senate condemns the Government for:(a) misleading the Australian people about the real price effects of the GST;(b) inadequately resourcing the Australian Competition and Consumer Commission, thereby not protecting consumers from GST related profiteering; and(c) threatening the viability of small business with unprecedented powers over small business pricing polices".A New Tax System (Aged Care Compensation Measures Legislation Amendment) Bill 1998At the end of the motion, add:"but that the Senate condemns the Government for:(a) proposing to lower the living standards of Australia's pensioners; and(b) attempting to mislead pensioners into believing that they will be compensated, when, in fact, as Mr Geoff Carmody of Access Economics has stated, `it is only a matter of time before the real value of the compensation offered in the ANTS package will be eroded to zero'".A New Tax System (End of Sales Tax) Bill 1998At the end of the motion, add:"but that the Senate condemns the Government for:(a) imposing a huge new paperwork burden on Australian small business through the GST, which does not exist under the wholesale sales tax;(b) increasing the number of businesses paying indirect tax to the Government from 70,000 to 1.6 million; and(c) imposing tax on the necessities of life for the first time".A New Tax System (Goods and Services Tax Imposition—Excise) Bill 1998At the end of the motion, add:"but that the Senate condemns the Government for imposing a new tax on the necessities of life, namely, food, clothing, shelter, household bills and transport".A New Tax System (Goods and Services Tax Imposition—Customs) Bill 1998At the end of the motion, add:"but that the Senate condemns the Government for imposing a new tax on jobs, which will:(a) lead to thousands of job losses in both Tasmania and Queensland; and(b) cause tens of thousands of job losses in regional Australia".A New Tax System (Goods and Services Tax Imposition—General) Bill 1998At the end of the motion, add:"but that the Senate condemns the Government for:(a) imposing a $2.5 billion increase in the insurance premiums of Australian consumers through a `design oversight';(b) failing to rectify this blatant revenue grab; and(c) pretending that this massive hike in insurance costs is in the national interest".A New Tax System (Goods and Services Tax Administration) Bill 1998At the end of the motion, add:"but that the Senate condemns the Government:(a) for the most complex, administratively expensive and job destroying tax this country has ever seen; and(b) for a GST that forces charities and other non-profit bodies to reallocate scarce resources to filling in forms for the Prime Minister (Mr Howard) and the Treasurer (Mr Costello), when these resources could be used to alleviate the misery and suffering of the poorest and most vulnerable members of the community".09:36:003970Murray, Sen AndrewSenator MURRAY3M6WAAD00—Madam President, as you know, I speak in continuation. Yesterday I was referring to remarks made by Senator Ferguson designed to damage the credibility and the status of the reports produced by the various committees, in particular the main select committee. That is a process of Senate abuse, if you like, which has been carried on by a number of government senators.Every committee in which I have ever been involved has had some difficulties in arriving at the final report because that is the nature of the report process. However, Senator Fergu son well knows that the private meeting of the Senate committee to consider the draft report did agree on what basis the report should be balanced up and how it should be treated. It was left to the chair and deputy chair—comprising six out of the seven members of the committee—to finally resolve the matter, with the specific injunction that government senators should balance up the report in areas where they felt there was insufficient evidence to support their viewpoint.At that meeting, we also made it clear—and I particularly made it clear—that government senators, Labor senators and the Democrat senator would rely on their supplementary reports to establish their position. The main report would summarise as much of the evidence as possible.Whether it was legitimate or not I do not know, but it was Senator Ferguson who chose—knowing that the date for the report was 19 April—not to be in Canberra. He chose not to be available for the last fews days on which the Senate committee report was to be resolved. As deputy chair, I would not have made that choice, but he did make that choice. It is entirely wrong for the deputy chair of that committee to condemn the process for political purposes when he himself had the ability to supervise the process.In proceeding to the substance of the bills before us, I want to focus on the government senators' report because it is the government's package—the government's New Zealand package, the government's New Zealand option—that is being put to us. The first conclusion of government senators was that:The Inquiry process produced no information that was not already in the public domain or had not been considered by the Government when putting the tax reform plans together and debated during the election campaign.I have to say that this is the most extraordinary, arrogant thing I have ever heard. I am startled that some of the Liberal senators who are of high quality could assume, and put their names to a statement, that they have perfect knowledge—that they could discount the views of 1,437 submissions, all the media and everybody else. This just seems amazing, particularly as I know, both from private conversation and on the record, that there were many facts about which they were interested and excited to hear—some of which supported their own views. Senator Conroy will recall the excitement with which the government treated new modelling that supported their views. They did not know that this modelling existed before, but they embraced it warmly when it helped them.The government say that the process produced no information that was not already in the public domain, but I remind you that there is a very serious issue here concerning culpability and law. I draw an example which you may find strange, but which is apposite. In France, ministers and former ministers are being prosecuted because they knew that, if you dealt with blood in a manner that was inappropriate, you put at risk the lives and health of the people who received contaminated blood.I draw this to your attention: remember that the government say they know everything. This is what they knew. At page x of the report of the Senate Environment, Communications, Information Technology and the Arts References Committee dated March 1999, in the executive summary—the Treasurer and everybody else knows this—the committee heard conservative estimates that:. . . at least 65 more people would die each year in Australia as a result of the increase in urban air pollution and traffic accidents if the GST package goes ahead as proposed. These would be predominantly young children and the elderly.If you are assuming perfect knowledge, you are telling the courts that, when you are prosecuted for somebody's death or ill-health, you knew something about it already. Ministers are being prosecuted in France because they knew that, if they dealt with blood inappropriately, they were putting lives at risk. And you know that you have been told by the Senate committee—by the AMA, a body of repute and credibility—that you will cause deaths if you pursue this matter. Therefore, you might find yourselves liable in law. I draw this to your attention when you say that you have perfect knowledge and nothing new has been observed.The second conclusion of government senators reads:The Inquiries by the Senate were poorly focused and mis-used by Labor and Democrat Senators who manipulated the Inquiries in an attempt to re-argue their political positions which were defeated in the last election. The Democrats ignored and misrepresented evidence which did not support their position with respect to food and GST.This is very one-eyed. Of course the Democrat senator and the Labor Party pursued their particular viewpoints. You do not think that the coalition did? You think that they are angels who sat back objectively and independently—who sat on high and did not support their position in their argument? This again reflects an attitude to the process of committee work and Senate appraisal of legislation that is extraordinary given the known quality of the coalition senators involved—who do know better.The third conclusion of government senators was this:Many witnesses and submissions relied on false assertions and anecdotes . . .Are you saying that all those who supported the government position did that or are you saying that it was only the ones who opposed it? Are you saying that all the submissions from the bishops and the churches relied on false assertions and anecdotes `many of which were irresponsibly perpetuated by the Labor senators rather than primary source material, such as the legislation and explanatory memoranda, which have been public since December 1998'? The conclusion continues:Government Senators therefore do not place any credit on the claims and conclusions of the Labor Senators which are willingly based on misleading and inaccurate evidence.Let me give you an example. Labor senators say that the first-year effect of inflation is between three and four per cent. The modellers, the economists and everybody else agreed, but because the Labor senators say it, is it going to be wrong?We then move on to item 4, `The Government's tax package entirely meets the criteria by which tax reform should be assessed.' This is the idea that the package is perfect—`Peter's perfect package'. It is just extraordinary—when you originally intro duced 16 bills, the detail of which was not before the people at the last election, and to that you added a further 17 bills, and there are more to come—that you can claim that it entirely meets the criteria by which tax reform should be assessed.The government says in item 4, `it is efficient—a single rate GST'. In fact, we know that indirect taxes number at least six and maybe seven. By the government's own laws, there are exempt, GST free, full GST, excise tax, wine equalisation tax and car taxes. There is no single rate; there are varied rates. And it says it `means minimum distortion to allocation of resources and prices and economic welfare increases by the greatest amount'. The jury is out on that. Essentially, the final conclusion of the very eminent people before us, including those by whom the government has put great credit, was that the economic effect will be moderately positive to negligible. I know that is a good outcome but that does not imply that it entirely meets the criteria by which tax reform should be assessed on an efficiency basis.It continues, `it is simple—least compliance effort by business and ATO and no wasteful tax re-classification.' Eighty thousand businesses are affected by making health and education GST free and some other items that they sell will be fully taxed. Are you telling me that there are going to be no definitional arguments in that area? Are you seriously expecting me to believe that given the history of the definitional arguments over wholesale sales tax? It is the nature of sales tax law, whether or not it is GST law, that there will always be definitional arguments. Whether or not food is left out, I guarantee—I am prepared to put a year's salary on it—that there will be definitional cases going to the courts on your proposals, never mind the amendments.Item 4 also says `it is equitable.' Well, this is an argument about fairness. In one of the last speeches yesterday, the point was made that compensation is necessary because it is unfair. It is a basic point. You do not need to compensate people unless there is unfairness apparent in the process. The government has used the word `compensation'. Therefore, the question is whether there is sufficient com pensation. Listen to this conclusion from the government in item 5 which says:There was no credible evidence to demonstrate, on reasonable assumptions, that any modelled household type would be worse-off as a result of the Government's tax reform package.Were they there? Did they listen to the evidence? That is just the most extraordinary denial of the truths that were put before them. So let us turn to their supporters, to those people who believe in a GST and believe that food should be taxed. The former leader of the Liberal Party, the leader prior to John Howard's present team—not far back, quite recent—Dr John Hewson said, and I quote the Australian Financial Review of Friday, 16 April 1999:. . . the Government should return to Fightback, as far as its compensation package is concerned. If there are lessons to be learnt—and there are—then the Government should learn them.While economists will continue to debate the technical minutiae of the compensation package, the Government really should now cut the Goebbels chant, `There are no losers!', admit that there will be, and revamp the compensation package to ensure that there won't be. Further, in doing so, the Government should ensure that the benefits of compensation are preserved into the future.That is not Labor senators speaking, it is not Democrat senators, it is not Senator Harradine; it is Dr John Hewson, the advocate of right-wing economic rationalism, saying that the evidence has proved that the government's compensation package is insufficient. Why deny it? Why go out into the world making fools of yourselves when the churches, charitable organisations, business organisations and your own supporters say that the compensation package is inadequate? You just end up looking like mugs. That is the problem with the coalition defence of their package. They are obliged by the rhetoric particularly of the Treasurer but also of the Prime Minister to hold the line regardless of the credibility of their argument.That is why Dr Hewson uses the most damning condemnation that can be used in the 20th century, that you are behaving like Nazi propagandists. Dr Hewson says you are using the Goebbels chant. I might add that it extends to Goering hysteria because, for some reason, the Treasurer believes that, if the package is amended to make it fairer, inflation will go up, the surplus will collapse, the deficit will ride over us and the Mongol hordes will pour over the borders of Australia. We are doomed! We are going to die because we are going to give a few bob more to the poor and to the disadvantaged! It is absolutely extraordinary.If the Senate inquiry has told anybody anything, it is that the poor and the disadvantaged will be undercompensated. They do not argue about the average, the mean; there are millions of people who will be undercompensated or will be losers. I can guarantee to you, from what I know of him, that Senator Harradine will not let you pass this package without attending to that problem because he is a moral man. So do not look to him to pass your package as it stands because he will not; neither will we. I carry on with the quote from Dr Hewson:The principal losers will be the aged and other low-income earners, including those who pay little or no income tax or receive little or no welfare benefits—those whom Warren identifies as the working poor, and those who are asset- rich but income-poor.What are the Democrats saying to you? What are the people you are trying to demean in your responses saying to you? They are saying to you, `If you don't pay income tax you don't get an income tax cut, and if you're not in the social security system you don't get a social security benefit, so you fall between the two of them.' This has been confirmed by Dr Hewson, whom the previous Prime Minister used to refer to as `Professor' in a derogatory fashion. But this chap is pretty clever, he is pretty well informed, he is well educated and he understands the evidence. The evidence is that your compensation package stinks, and it needs to be improved. He said:But the revamp should be more than just a political exercise. One of the features of Fightback of which I am most proud is that in designing the compensation package we didn't just seek to compensate for the CPI effects of the tax package, but rather to actually skew the benefits to those who are particular disadvantaged in our society (those who, to some extent, have become victims of the "system"), by deliberately and generously overcompensating them. John Hewson went to the people and said he would compensate those people—better than you would, so he says—but he also made a critical mistake which you have not. He took the whole package—all the details, warts and all—to the people, and the people rejected it because they did not like the composite package. What have you done? You have fudged and denied and gone about with mistruths and misrepresentations, and the result is that the Senate has the job of fixing this package.Professor Neil Warren is an Associate Professor of Economics at the Australian Taxation Studies Program at the University of New South Wales. He wants food taxed, he wants the GST, and he is an author of the Fightback package—so he is on your side. In the Financial Review of 13 April 1999 he said:First, the current compensation package needs to be significantly improved—he is not talking about fiddling at the edges; he is talking about making real change—with greater assistance to low-income households. Second, there must be a rethink on how best to compensate the low-income working poor and self-funded retirees.And finally, the current compensation "lock-in" mechanism designed to ensure that the compensation package is maintained into the future will not work—even the Treasury now admits this is the case—and must be rethought.Let us go back to page 347, item 5, of the select committee's main report. I will read again what the government said:There was no credible evidence to demonstrate, on reasonable assumptions, that any modelled household type would be worse off as a result of the government's tax reform package.You have lost that debate. You can go out and pillory the Senate as much as you like, you can tell lies about its obstructionism, you can tell lies about how the Senate process works and how the committees work, you can damn the senators, but you have lost that argument—the people do not believe you. We do not believe you, and we will not vote for your package for as long as your compensation package stands as it is. Item 6 of the report states:The reasoned evidence— says the government—to the Inquiries overwhelmingly supported food remaining in the GST base on efficiency, simplicity and equity grounds. The Democrats refused to acknowledge that when informed witnesses addressed issues of equity and fairness they supported the use of direct compensation rather than narrowing the broad-based design of the GST.While I cannot repeat the endless statements on the record when we dealt with those two competing issues, let me make it clear to the Senate and to the people of Australia that when it comes to issues of fairness versus complexity we are on the side of fairness. Sorry, folks—we are on the side of the poor and the disadvantaged.This report talks about reasoned evidence. So the bishops are unreasonable—they do not have reasoned evidence; ACOSS do not have reasoned evidence; the charitable organisations do not have reasoned evidence; and those who do not want the essentials of life taxed do not have reasoned evidence. Oh no, says the government, the only people we are going to listen to are the disciples of mammon. We are not going to listen to the bishops and the churches—no—but we will go and bend our knees every Sunday. But does anyone think that the churchmen at the end of their services sidle up to the coalition senators and members of the House of Representatives and say, `Good on you folks. You've got the right package. We're right behind you, but we're not going to tell the people that?' The bishops and the churches are telling you it stinks, and they have put reasoned evidence before us. Those on the other side are simply saying, `Discount that, because simplicity matters more.'Let us talk about the simplicity argument. The government says that, at the minimum, the cost of imposing a GST on business is $1.9 billion. Let me repeat that: $1.9 billion at the minimum. Others think it could reach as high as $2.7 billion—from $1.9 billion to $2.7 billion—to introduce the GST as the government proposes. The Australian Society of Certified Practising Accountants, ASCPA, says that the cost of making food GST free will be $100 million—five per cent. The point is: how do you say that this entire package is ruined when the total compliance cost is $100 million for making food GST free, but somehow the $1.9 billion doesn't matter at all? It just does not add up. So when the bishops and the churches and the charitable organisations say to us, `Do not tax food,' when the people of Australia say to us, `Do not tax food,' and those on the side of taxing food say, `The total compliance cost is $100 million,' I am afraid that I am on the side of the churches and the charitable organisations and the $100 million.H15CAMPBELLSenator Ian Campbell—You're on the side of hypocrisy!3M6Murray, Sen AndrewSenator MURRAY—Mr Acting Deputy President, I draw your attention to the state of the house. (Quorum formed) To continue my remarks, the way in which the government has attacked the Democrats is extraordinary because the Democrats have accepted that there need to be changes to our tax system. We are suggesting amendments to make it fairer. We are suggesting amendments to avoid very real problems which have been exposed in the Senate's inquiry. We are suggesting that it is not Peter's perfect package and that the government should acknowledge the difficulties where they arise.The Democrats have said that they are prepared to support a fair tax system. We say that this tax proposal as it stands is not fair. We say it will make the poor and the disadvantaged worse off. We say that its economic benefits are skewed. During the early days of the committee the economic effects of the GST were considered in detail. We did find that the indirect tax base is shrinking as a proportion of gross domestic product and that PAYE taxpayers are paying an unfair burden due to the exponential growth of tax sheltered income. Because of this, there is a strong case for relief for pay-as-you-earn taxpayers to offset the effects of bracket creep since 1993. But there is not a strong case for 80 per cent of the benefits to go to 20 per cent of the taxpayers at the upper end.While the ANTS package is likely in the longer term to have a small but positive impact on the economy, the GST itself is unlikely to have a significant positive effect on employment. Any jobs improvement from the package is likely to come from the elimi nation of poverty traps and other related measures. Again and again on the public record I, on behalf of the Democrats, have congratulated the government for attacking the problem of poverty traps, but it needs to go a lot further. We found that zero rating sufficient foods in the economy for up to 90 per cent of all food will increase the number of jobs created in the short term by 8,000 to 12,000 but will not affect the long-term macro-economic benefits of the tax package.We have drawn a number of lines in the sand. Those lines in the sand relate principally to making the compensation package far fairer, to making most foods GST free and to delivering the economic benefits of the diesel excise proposals without attaching to it the dreadful environmental harm which will attach to it if it is extended into the cities.Treasury has argued that all households had similar price effects, showing that pensioners, disability pensioners, self-employed and couples without children face much higher price effects than single employed people, for example. The NATSEM report firmly debunked this view. Unfortunately, the NATSEM report did not calculate price effects for households by income.3L6CONROYSenator Conroy—We did ask them to.3M6Murray, Sen AndrewSenator MURRAY—We did ask them to. This is a major failing because the GST effect on the bottom quintile is half as much again as it is on the population as a whole. For those who are not technically minded, this means that essentially the modellers were unable to assess appropriately at what level and how the losers lock in in this situation. The Labor Party have listed two million losers. We have identified 1.1 million people who are not caught by either the income tax system or the social security system. We believe up to 4.9 million people are potential losers or will benefit marginally in this situation. All of that means that the government has to redo its numbers. You can retain the intent of your package if you attend to compensation, if you attend to broadening the number of goods made GST free, if you attend to the bad side effects from your diesel fuel policy.Distinguished economist Professor Neville says that differences in consumption patterns vary depending on the circumstances of the person. Had the NATSEM modelling taken income specific spending into account, a much larger number of losers at the lowest level would have been identified. Unfortunately, what has happened is that the argument is now about how many and whether and all those sorts of things. I have deliberately put a great deal of emphasis on the words of Dr Hewson and of Professor Warren, because that line of argument is a nonsense—that is a diversion. It is accepted by business organisations, by charitable organisations, by the Democrats and by the community at large that the compensation package has to be improved. So stop talking about marginal changes; let us pull out a few billion to attend to that—and you have that money.The food issue is something we will concentrate on during the committee debate, but really we have four options before us. The New Zealand option is the government's option. The New Zealand option says we will make food taxed. I have been to New Zealand recently and I have spoken to the people who attend to the needs of those at the bottom end of society in New Zealand. The result of the New Zealand changes overall has been bad for the poor and the disadvantaged in their society. We do not need to follow the New Zealand model. The other models with regard to food have broadly been described as the Dutch model, which is the all out model; the British model, which is food out, except for restaurants and takeaways; and the Irish model, which more narrowly defines food primarily as fresh foods and commonly consumed groceries.Frankly, as Senator Lees said yesterday, it is Peter Costello's call. If he wants to go with the Australian Food and Grocery Council to all out, we are there. We will be quite happy with that. We will accept any of those definitions that we have put forward, or variations of those definitions. I want to remind the Senate that, on the food issue, Professor Cnossen said there are 105 countries in this world—and I think that is about half of all of the countries—that have a GST or VAT system. The vast majority of them do not tax food or they concessionally tax food. Even those countries which Professor Cnossen has advised as to how they should treat the GST system in their country have continued down that route.Those are often countries that have authoritarian governments, which do not have the restraints that we have in our system. Yet on behalf of their people, over the 40 years in which GSTs have been applied, they have chosen to follow the principle of not taxing the essentials of life—in particular, food. Somehow this government says that we should follow the New Zealand option because that is much better on the grounds of simplicity. We should tax food because if we do not it is going to cost 40,000 retailers $100 million. What an extraordinary view. This government was quite happy for the superannuation industry to incur $100 million worth of costs in trying to manage a new tax, yet it says that $100 million dollars worth of food compliance costs are too much. It is ludicrous. (Time expired)10:11:003976Harradine, Sen BrianSenator HARRADINE6H4TASIND00—I have been deeply involved in the minutiae of the tax package in attempting to understand it with as much completeness as I can. I was going to deal with the details of the package in this speech during the second reading, but I realise now that speeches in the second reading are to address the principles which should govern our approach to measures such as this. So, if you will excuse me, I will attempt to express some general principles and viewpoints and then come to certain specifics.The mere mention of taxation in any forum at all will of course get a reaction—there is no doubt about that. If you talk about taxation, you immediately get a reaction because everybody has an opinion on it. The government has now presented to the parliament, and through it to the people, a taxation package which is nothing less than revolutionary. It has far-reaching consequences. The government is to be congratulated on addressing this very important issue in our society. The ACCI and others called the tax summit in 1985, and there has been consideration given by various governments to it, but at least this government has attempted to bite the bullet. Whether that is ultimately good for society or whether it is not depends on how it measures up to certain principles.The government has had a long-term plan on this particular issue and on other areas as well. I do congratulate the government for the way it has sold the package and on how opinion makers appear to have grasped the package as if it were a lifebuoy thrown over in turbulent economic seas. Even those who are going to be shafted by this particular package—for example, the farmers—seem to have accepted it. During a committee hearing in one state, it was the first time in my long experience in this parliament that I heard any group at all say, `Please tax my products.' That is precisely what is occurring in respect of the producers of food in this country.Not unexpectedly, we have had an enormous response to the package. Some 1,300 actual submissions were made to the ANTS committee of the Senate. They were very useful indeed. I felt that the committee system did work. I know the Treasurer had another view about the matter, but the committee system enabled people to come before the committee and to express their views for or against—or to suggest certain amendments. I found that very useful indeed. I would like to take this opportunity of congratulating the secretary of the committee and the committee staff for the extremely professional way that they approached their task. I feel they are not often given credit where credit is due. This was somewhat of a different type of committee from the ones I have been used to in this place in that people—and I am talking about the government and the opposition—appeared to have a fixed point of view that they did not deviate from, and that was a bit of a problem. Nevertheless, I found the committee inquiry useful. I also found very useful the thousands and thousands of letters and phone calls that I received from people throughout Australia. I have to apologise that I have not been able to answer them all or even a majority of them. Let us face it: unfortunately in a position like mine, which is an undesirable situation, you do get a huge volume of mail. One day in December last year 2,300 actual pieces of mail came to me—and that is not counting the email. Whoever invented email ought to be strung up! So I do apologise for not answering them all. I take this opportunity of thanking my very dedicated staff for the way they have handled all of these matters.Tax has a social as well as an economic dimension. It has social and economic consequences. It does raise questions of what is best or better, what is good or bad, what is right or wrong. There are moral as well as economic consequences; and there are moral choices to be made by the government. These must be made by the government. Books have been written about the purpose of government, but the purpose of government is simply the administration of the common good preferably in a free, equal and life-affirming society. The object of a free society is not laissez faire; the object, surely, of a free society is the genuine flourishing of the individual human beings living within that society. To achieve that, democracy and the market must be disciplined by a vibrant moral culture which is grounded upon a shared public conviction as to what is `moral truth'. The cynics will say, `What is truth?' If the government allowed that situation to exist, then of course you would have a laissez faire situation where the rich got richer, the poor got poorer, and you had the survival of the fittest. I believe none of us would adhere to that cynical view of unrestrained economic rationalism or heavy-handed dictatorial government.Tax is a very much needed tool for governments to administer the common good. Surely, in the consideration of this very vital subject of taxation, we should all have a shared public conviction of what is moral truth and what are the principles which should guide such an important consideration. Could I suggest that among those principles are the need to build a nation and to protect its people and the need to create an economic and social order in which the citizens can live with freedom and dignity and pursue both their spiritual development and material wellbeing in conditions of equal opportunity and economic security.Tax should not stifle human initiative. It should reward people for work, it should remove poverty traps, it should be fair and simple and be based on the capacity to pay and it should have high compliance and low evasion. One of the things that is in the minds of people when you go around the country is: how come one of the richest people, probably the richest person in this country, does not pay tax? That may or may not be so, but that is what you get all the time. So the tax should be based on the capacity to pay. It should be progressive, not regressive; that is, falling on those least able to afford it. It should, of course, uphold the principle of distributive justice. In other words, we should uphold the dignity of each individual human person, because the test of a civilised society is in how it treats its most vulnerable.I come to the final point of what a government should do in respect of tax in our society. The fundamental group unit of society is the family, and its taxation measures should be family friendly. Why is the government proposing to have a GST? The GST is required, according to the government, because of the dwindling tax base. Why do we have a dwindling tax base? Because people are not having children—that is why. We are getting to be an ageing population; we are going to have an enormous problem.But the burden of that problem is now being placed, through a GST, on families, who are not responsible for the original problem. If Australia needs new taxes to expand the revenue base to pay for pensions and health services for an ageing population, does it make sense to impose a GST on the necessities of life involved in raising children? Does this not mean fewer taxpayers and a smaller tax base in the future? We only have to look at what is happening in Europe. European birth rates have dropped well below replacement rates as the tax cost of children has gone up with increased value added taxes. Should we be making it harder for Australian families to have and raise children? The cost of raising children is assumed to be a form of consumption tax—remember we are talking about a consumption tax. But investment in children is surely a social and economic necessity if the economic system is to continue. We will get the response, `But there is compensation in the package.' May I respectfully suggest that that is not enough and that much of that is doing what ought to have been done previously.The Labor Party cannot take any solace at all from its continued erosion of the family in the tax system. If it is going to win power it will need to have a look at both the electoral advantage and the economic advantage in Australia and do something about the family. Otherwise that fundamental group unit of society will be left high and dry.Much has been said about food. I put to the Senate that there is far more than food involved, and I know other honourable senators realise that. There are other necessities of life. If I recall correctly, we heard during the committee inquiry that for the lowest quintile of family groups food represents an outlay of some 24 per cent of household income, whereas the other necessities of life—clothing, rent, transport and the like—represent 38 or 39 per cent. There might be people who are able to go without clothing in this nation; you certainly cannot in my state.Honourable senators interjecting—6H4Harradine, Sen BrianSenator HARRADINE—There was a dump of snow on Mount Wellington this morning. In all seriousness, these are necessities of life, and I believe that the compensation for them that has been suggested by Treasury is not adequate. I will not go into the modelling or the misassumptions that underlie some of the proposals in the tax package.There are suggested compensation packages for pensioners and people on low incomes, and I am quite convinced that those compensation measures are inadequate. Some people have suggested, `Why don't you go along the way of NATSEM's option 7 with tobacco and housing in?' If people are into this business of compensation, that is certainly well worth looking at and modelling but, as Mr Carmody has said, you do have to lock the compensation in in some way. As far as pensions are concerned, you have to lock them in to the male total average weekly earnings—25 per cent plus, in that case, six per cent.Whilst we are talking about compensation, let us talk about the other issue: the rate of the GST. The rate of the GST, it is said by the government, will not change unless all the states agree. As Mr Keating said—Senator Lees referred to it the other day—Honourable senators interjecting—6H4Harradine, Sen BrianSenator HARRADINE—That's right—`Don't get between a premier and a bucket of money.' So I do not know whether that is a satisfactory measure at all. If this is going to go through, you have to lock it in in some very severe way so that the 10 per cent will not grow.I am a believer in the principle of subsidiary function—that power should reside with the smallest group capable of efficiently performing the functions with the power required. That is a very important principle, and I therefore believe in state governments, local governments and the like. I am a bit worried, philosophically, about money just flowing to the states without them having the responsibility to do anything about it. I understand the problem about regressivity of so much of the state taxes. (Extension of time granted)I am greatly concerned about the fact that certain charities are going to be affected substantially by this measure. These have been mentioned in the debate, so I will not remention them here. At the last meeting of our committee, I did ask the Treasury official who the losers were. I have a response. The response did not satisfy me, and maybe it never will. It is very difficult to determine who are the losers—some you can. But bear in mind that the government has been saying that there are no losers. There are in fact losers, and they must be compensated. The government must consider the ways and means of compensating those losers.One came to mind only yesterday when a friend of mine faxed me, and that is a PhD student living off the smell of an oily rag—well, living off a scholarship. I believe PhD students should live off the smell of an oily rag. It helps their intellectual capability and they perform better. But never having done any of that, I would not know. That is one, and self-funded retirees are another. So quite a large number of people will be in that losers group. How do we compensate them? Treasury says that it is very difficult to do so because they do not have a relationship with government. Mind you, a lot of them do not want a relationship with the government, to be quite frank. I have actually known people who were eligible for the pension and have not claimed it. There are quite a number of those. There are people who are not in the taxation system and they are not in the social security system. The government has plenty of ideas. Maybe it should come up with a tax credit fund or some such plan that would be able to fund the extra taxes which these people will be required to pay without any compensation.There are other matters that I wanted to briefly mention, but I will just limit them to a couple. I think it is important for me to raise them. One is the question of the international competitiveness of the tax package. It is suggested that international competitiveness would be advantaged by the package as a whole. If the GST does produce claims for compensation—wage claims, for example—and wage outcomes, then it may have a negative result.I will ask certain things of the minister representing the Treasurer. How does the GST lower the equivalent marginal tax rate if income equals consumption plus savings? Does it matter for economic incentives whether money is taxed going into the purse or pocket or out of the purse or pocket? Is the GST equivalent to an income tax surcharge on income less savings? If a person spends 90 per cent of their income, does a 10 per cent tax on spending amount to a nine per cent income tax surcharge? Can the Senate be provided with tables showing equivalent marginal tax rates after adding back net indirect tax rates to the proposed income tax scales? What about the payment of compensation via social security? Does that involve economic inefficiency in churning money around? Some of these questions were briefly referred to during the committee hearings. I raised a number of questions—and continue to raise them—about the Ralph committee and how the Senate does not have before it all of the proposals that were mentioned in the document entitled Tax Reform: not a new tax, a new tax system. Are they logically consistent? Indirect tax reform is supposed to bring investment into Australia, but will the direct tax measures drive both domestic and foreign investment out of Australia? I was very interested to read an article by Steve Lewis and Fiona Buffini on page 4 of the Financial Review:The business community has mounted a strong push to ease the tax impost on offshore earnings of domestic—and multinational—companies in a bid to boost Australia's international competitiveness.Already there is some considerable concern being expressed in that case by the Business Coalition for Tax Reform.The indirect tax reforms are meant to reduce the cost of producing in this country. This is supposed to attract foreign investment and expand our capital stock, our employment and our exports. But many of the measures being considered by the Ralph committee have been roundly criticised by both tax professionals and representatives of groups of foreign investors as creating disincentives for foreign companies to invest here or even for Australian companies to retain head offices here. In addition, there are serious concerns about the relative competitiveness of Australian managed funds against incoming US mutual funds, about disincentives to save through life insurance and about the impact on small business and farms, might I mention, of taxing trusts like companies. Family farms and small businesses may experience serious cash flow drains. Others have also pointed out that the loss of accelerated depreciation being considered by the Ralph committee would have adverse impacts on exporters such as miners and farmers and tend to negate or offset the benefits of GST refunds on exports.I did not see any modelling of this, and I asked a number of questions on these particular matters during the committee inquiry stage of the Senate process. No modelling has addressed these matters. We do not have it before us here. Is it fair to ask us to judge all of these things without having the second leg of the package to consider? I just raise that. Maybe the government will be able to advise us on these matters. In this sense the Senate does not have before it all those issues.The windfall losses of groups of people have been referred to in other speeches, including those who will have to pay increased insurance premiums because of the transitional costs of the package on insurance. There is also the question of how credit unions, Aussie Home Loans and others will be affected. That has all been referred to in other speeches.Finally, I want to come to the question of whether the GST legislation is constitutionally valid. Is there one subject of taxation as required by section 55 of the Constitution? The High Court decision in the Mutual Pools case seems to indicate that the Commonwealth may not be able to make up a subject of taxation entirely as it pleases, that it cannot tax land and intellectual property, for example, under the one imposition act. These are matters that I think one should raise in a speech on the second reading. I have some advice on this and I just raise it for the government's consideration. I do not think that the enormous anti-avoidance powers that have been given by the GST bill to the Commissioner of Taxation would be regarded in the long run as constitutional.It would be great if we could have consensus on such an important public policy issue. It would have made it more credible. However, that is not the case. I would have liked to have gone into the question of the mandate, how the Senate is part of the government in the broad sense and how our responsibility is the administration of the common good.I am concerned, most importantly, about the effects on jobs in my own state of Tasmania. That has been stated quite clearly by the government's preferred modeller, Mr Chris Murphy, who stated that there would be substantial job losses. I would like to hear responses by the government. I thank the Senate for allowing me to continue over time.10:41:003981Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—The bills being debated in the Senate, A New Tax System (Goods and Services Tax) Bill 1998 and related bills, establish a new tax system for Australia. This is the most comprehensive reform of taxation in the history of this country. The bills set out a new tax system for the new century. The legislation sweeps away an outdated, inefficient tax system that does not serve the needs of the modern nation. The new tax system rewrites Commonwealth-state financial relations. The new tax system which we have proposed will lighten the burden of income tax for families and average wage earners.The government's proposal was released before the last election and we put the plan to the Australian people. The taxation plan, Tax Reform: not a new tax, a new tax system, was the central focus of the election campaign. It was debated on a daily basis in all the media. After that prolonged debate, after the consideration of the government's proposals to reform the taxation system in the country, the people of Australia endorsed it at the last election. We asked for a mandate and we received that mandate. The government's tax plans, which are now before the Senate, encapsulate these changes to deliver to our great country a more productive and more competitive tax system. It will help our exports, deliver more jobs and work to improve the standard of living in this country. We believe that, after this very prolonged debate which has ensued since the government's plans were first released in the middle of last year, we have received overwhelming support. We have received the mandate that we sought from the people and which I mentioned.Business groups have been very supportive. Businesses have already noted that they will enjoy lower costs and be able to grow and give more Australians jobs. For example, the Business Coalition for Tax Reform said:We believe that measures in `A New Tax System' form an integrated approach to tax reform that will improve our international competitiveness, encourage investment and job creation, encourage savings and improve fairness. The farming sector has been particularly supportive of our tax reform plan. The National Farmers Federation stated that, for farms modelled, the benefits range from an average increase of $1,825 up to $49,000 per annum. The increase in disposable income was typically in the range of one per cent to two per cent per annum.We went to the people; we received a mandate. Farmers support this measure; and people in rural Australia, we believe, support the measures we put forward. Business groups large and small support the tax package. But also all state premiers and territory chief ministers endorsed on 9 April 1999 the intergovernmental agreement on the reform of Commonwealth-state financial relations. This is the largest single transformation of Commonwealth-state financial relations since at least the Second World War. It improves the financial position of the states by providing them with access to a robust and growing tax base. This is needed to secure the funding for important community services like roads, hospitals and schools.There has been some debate in this chamber about the reaction of state premiers to the tax reform package. The state premiers, not surprisingly, as some have noted, want a growing source of income. But we should ask ourselves why they want that growing source of income. Of course, they want that growing source because state governments provide important community services like roads, hospitals and schools. This is why the state governments want to put intergovernmental financial relations on a sounder basis.Let me make it clear. This path-breaking reform of Commonwealth-state financial relations is only possible because of our tax reform plan. If we are going to help the schools and welfare services in the states, and if we are going to help the states to carry out their important health functions, people who support that will vote for these bills. Let me quote Premier Kennett of Victoria, who said:I think the Premiers Conference is a seminal day in Australia's history. It is now up to the Senate to recognise its responsibilities and to discharge them in the same way. As Premier Beattie said: `The Howard government got a mandate for the GST in the last election.' This is a historic opportunity for Australia. The government had the courage to put a comprehensive tax reform plan to the people before the last election and, unfortunately, we have seen that the Labor Party has adopted its usual `no' approach to any major reform program. This is in contrast to the very different attitude that the coalition took when we were in opposition. Of course, the former ministers of the Keating government now run away as fast as they can from the reforms that were carried out by the Keating government, but the fact of the matter is that these reforms were supported by the coalition parties when we were in opposition.The Labor Party has basically turned its back on reform of the tax system and has mounted what is seen to be an outrageous scare campaign. The Labor Party refuses to accept that Australia voted for tax reform, for major tax cuts and benefits for Australian families, and for generous compensation for low income Australians. It is interesting to note the difference between the attitude of the federal Labor Party and the approach that Labor premiers and their state branches are taking. As I said, you have only to look at the comments by Mr Bacon, the Premier of Tasmania, by Mr Carr, the Premier of New South Wales, and by Mr Beattie, the Premier of Queensland, to see that the federal Labor Party is quite isolated in its completely negative attitude to tax reform.Of course, we have had people like Mr Bob Hogg, a former federal secretary of the Labor Party and a former state secretary of the Victorian division, who has called on the Labor Party to pass these bills. I put it to you, Mr Acting Deputy President, that the federal Labor Party, even within its own ranks, is becoming increasingly isolated as the wider community continues to appreciate the significant benefits of the government's tax reform program.The introduction of our tax reform program will be a very significant change to the taxation system in this country. Wholesale sales tax will be abolished. This is the system which the Labor Party thinks is a good sys tem, but in its views it is completely isolated. The federal Labor Party is the only institution in this country which believes that the wholesale sales tax system is a good system.In consultation with the states, we are abolishing nine types of taxes—which again will help make sure that we have an efficient tax system. Let me list some of the taxes that will be abolished by state governments: financial institutions duty; the debits tax; the stamp duty on marketable securities; conveyancing duties on business property; stamp duties on credit arrangements, instalment purchase arrangements and rental hiring arrangements; stamp duties on leases; stamp duties on mortgages, bonds, debentures and other loan securities; stamp duties on cheques, bills of exchange, promissory notes; and, of course, the so-called bed taxes.The abolition of the wholesale sales tax and other taxes is vital to reduce the cost of doing business. At present, half the money raised from the wholesale sales tax comes from taxing goods purchased by business. It imposes a hidden tax on exports and import-competing industries. The introduction of the GST will change this. As businesses are entitled to full import tax credits, the hidden burden will be removed. In fact, business costs will fall by more than $10 billion, as a result of the GST and the abolition of current inefficient and unfair taxes.The GST will also lead to a $4.5 billion fall in the cost of exporting. Lifting this burden will increase the competitiveness of Australia's export industry. The bill provides for GST-free activities which include exports of goods and services, international air and sea travel, and domestic air travel purchased by non-residents, taxes and charges at all levels of government—excluding local government rates and water and sewerage rates and charges. The price of GST services will fall, because tax will be removed from the purchase of those supplying them. The GST will be broadly based, providing simplicity for business and consumers.The government has not neglected important community services. In its plan the government proposed that virtually all health, education and child-care services, charitable activities and religious services should be GST free. The recommendations of the Voss committee further extended the GST-free areas proposed in the government's tax policy. They recommended GST-free treatment for a wide range of medical and allied health services. They provide for comprehensive GST-free treatment for residential and community care for the aged and the disabled, provided that care is at a sufficiently high standard. They provide for GST-free treatment for a wide range of aids and appliances specifically designed for people with illness or disabilities. They provide for GST-free treatment for all secondary and tertiary courses, including vocational courses, provided students are eligible for income support. They provide generous rules for charities. All of these recommendations were adopted in the legislation which is now before the Senate.One major issue is constantly ignored by the Labor Party as they attack the government's reform program. We are providing major tax cuts to the Australian people. The tax cuts will more than compensate taxpayers for the introduction of the GST and will also make it possible for ordinary Australians to save and invest. The personal income tax bill gives effect to the cuts in rates of income tax and provides extra assistance to families by increasing the family assistance tax-free thresholds. The tax-free threshold increases to $6,000 and the lowest rate decreases from 20 per cent to 17 per cent. This helps all taxpayers but is of particular benefit to low income earners.Under the old system incomes between $20,700 and $50,000 were subject to rates of 34 per cent and 43 per cent. The new system applies a lower rate of 30 per cent to all those on incomes between $20,000 and $50,000. I stress that this will mean that around 81 per cent of taxpayers will have a top marginal rate of 30 per cent or less compared with 30 per cent of taxpayers at present.Lower and middle income taxpayers in particular will keep more of their wages. This incentive encourages Australians to seek promotion, extra training and overtime. More effort will now mean more reward for individuals as well as a more productive Australian economy. The top rate remains unchanged at 47 per cent for those with annual incomes of more than $75,000. The $75,000 threshold will be equal to around 1.7 times average earnings, and this will ensure that average earners do not drift into paying the top marginal rate, which would have otherwise occurred early in the next century.I mentioned the significant gains for rural and regional Australia. The reform package also acknowledges the high cost of transport, particularly for rural and regional Australia. The new diesel fuel credit scheme will effectively reduce diesel excise for all off-road—including marine—users from around 37c per litre to zero. For the larger transport users, including rail, the reduction will be from around 37c per litre to 18c per litre. This is on top of savings of 7c per litre for business users of petrol and diesel through their access to a refund of the GST paid on fuel. Alternative fuels will remain excise free on the introduction of the GST tax. The reforms to diesel fuel are now to be opposed by the Democrats, although we are yet to see their amendments. They have been promised as soon as practicable, and we look forward to seeing them. As the Deputy Prime Minister pointed out in the House, this opposition by the Democrats will overtly penalise those who live in rural and regional Australia.No bills before the Senate have been subjected to greater inquiry than these bills. No bills that have ever come before the Senate, as far as I am aware, have received such intensive Senate scrutiny. If you add together the number of months that Senate committees have met, we can probably reach at least 52 weeks and possibly more. Every possible aspect of these bills which are before the Senate have been subject to intensive inquiry. Hundreds of submissions have been received. We believe that everyone who had a question to raise certainly was able to use those vehicles.We believe that there is no credible evidence to demonstrate, on reasonable assumptions, that any modelled household type would be worse off as a result of the government's tax reform package. The recent evidence to the inquiries overwhelmingly supported food remaining in the GST base, on efficiency, simplicity and equity grounds. The Democrats have unfortunately refused to acknowledge that, when informed witnesses addressed issues of equity and fairness, they supported the use of direct compensation rather than narrowing the broad-based design of the goods and services tax. Yesterday the Democrats provided some further signs of their proposals to amend the bills before the Senate. We believe that the measures announced by Senator Lees yesterday would not only greatly increase the complexity of the taxation system but also favour the higher income earners. We believe the measures ignore the evidence that was presented to the committee.Let me take the example of baking products. Baking products, with the exception of bread or fruit bread, will not be taxed. But what if, as the Baking Industry Association itself says, the baker runs cheese or other products on the bread? What is bread? Is a cheese and bacon roll bread? Is a bagel bread? Is a fruit bun bread? These are just some of the examples. There is a plethora of examples which could be used to demonstrate the complexity that the amendments proposed by the Australian Democrats will lead to in the tax system. After this very prolonged period of inquiry, we believe that the overwhelming weight of evidence supports the government's position. We believe that that is yet another reason why these bills should be passed, and be passed forthwith, by the Senate.Let me turn briefly to the personal tax cuts and increased family assistance. From the outset, one of the government's guiding principles for tax reform was that there must be no overall increase in the tax burden. We have delivered on that. The tax cuts will more than compensate taxpayers for the introduction of the goods and services tax and will also make it possible for ordinary Australians to save and invest. The personal income tax bill gives effect to the cuts in rates of income tax and provides extra assistance to families by increasing the family tax assistance tax-free thresholds. We believe, therefore, that in so many ways the system that we propose across the broad range of Australian society provides huge benefits for the nation, for its people, for its families and for the people who run business. Indeed, as I said, across the broad sweep of the nation, we believe that the system that we propose is one which deserves the support of the Senate.A number of amendments have been moved by non-government senators. It will not surprise senators that we will be opposing the amendments which have been moved. Senator Cook's amendment in particular attempts to defeat the second reading of the bill. Of course, if that particular amendment is passed, that will end the debate forthwith. This again shows the incredibly negative attitude of the Labor Party to tax reform. The Labor Party is now attempting to stop proper debate on these bills.ZW4SHERRYSenator Sherry—Defeat them—no GST.WW4Kemp, Sen RodSenator KEMP—The Labor Party not only is ignoring the mandate that the government received at the last election, not only ignoring the weight of evidence that was put to the Senate committee, but also is now, through the amendment proposed by Senator Cook, attempting to defeat the second reading of these bills. The government, quite naturally, strongly opposes this move by the Labor Party. To repeat myself, this will mean, if that amendment is carried, that there will be no further debate on these bills.Senator Cook sits here in the chamber and smiles and nods in agreement. Senator Cook, the truth of the matter is, I think, if you move down this route, that the Labor Party will properly stand condemned. We had an election on these bills. We won the election. We are now going through the proper parliamentary procedures in putting our proposals to the parliament. It is fascinating that the Labor Party seeks to stop debate that other non-government parties may wish to have on these very important bills and to prevent the government delivering on its election promise. Make no mistake: it is an attempt to prevent the government delivering on the promise that we went to the Australian people on and that we were elected on.I am foreshadowing a number of government amendments to the GST bills that we will be moving in the committee stage. The amendments will incorporate suggestions made to the government during the wide-ranging and very constructive consultations we have undertaken since the bills were introduced. These changes do not alter our GST proposals but merely refine the legislation to ensure that the government's policy is carried through in the most practical, efficient and cost-effective way possible.With the assistance of a number of professional and industry bodies and through input from community organisations we have continued to look for ways of making the design and operation of the GST even better. I am pleased to report that this has resulted in a number of innovative changes which will continue to support our claim that our GST is world's best practice.There are around 30 issues on which amendments are proposed. These amendments are in the nature of finetuning of the bill. However, half a dozen or so of these changes are of particular note. They include the changes we are making to the GST treatment of insurance and to the general anti-avoidance provision, to extending the benefit of the grouping provisions to small business structures and to corporate treasuries, to making it clear that the separate sale of farmland and improvements will be GST free and to making a number of changes that will make administration easier for charities.The model we are adopting in Australia for the goods and services tax treatment of general insurance is an elegant solution to a set of circumstances other countries are still struggling with, and it gets the right result. This approach provides complete treatment for both the insured and the insurer. It means that input tax credits will be available for payouts when the GST is paid on premiums and, conversely, that no credits are available if no GST is paid on premiums. Payouts under insurance policies will have no GST consequences for unregistered persons.The government is also responding to concerns raised about the general anti-avoidance provision. That is, I think, one of the issues that Senator Harradine raised in his remarks. We will amend the provision to make its scope and operation clearer, to ensure that it does not apply to anything done or any arrangement entered into before 2 December 1998, to make it clear that it will not apply to the exercise of an option provided for under the legislation and so that it applies where the tax benefit obtained is the principal effect of the arrangement and not simply a principal effect.The GST grouping provisions that apply for the benefit of companies will be extended to trusts and partnerships. This will ensure that small family businesses which conduct their businesses through several entities, including trusts and partnerships, will be able to share in the compliance cost benefits of grouping in the same way as a group of companies.There are also a number of amendments in this package which will make dealing with the GST easier for charities. Under the GST, entities can choose to account on a cash basis if their annual turnover is $500,000 or less. Businesses will generally account for GST on the same basis as they currently account for income tax. However, charitable institutions and gift-deductible bodies do not need to account for income tax and often account for their activities only on a cash basis. Under amendments I will move in the committee stages, charitable institutions, gift-deductible bodies and trustees of charitable funds will be able to choose to account on a cash basis regardless of their turnover.The government's expressed intention was that no net revenue would be raised from applying the GST to gambling. This would be achieved by reducing state and territory taxes by a similar amount to the GST. However, in the case of raffles conducted by charities, no state or territory taxes will be levied. To ensure our policy is achieved in the simplest possible fashion, such raffles and bingo run by charities will be GST free.Amendments will also make it clear that the sale of the family farm and improvements as a going concern will be GST free. However, farms are often sold piecemeal, that is, the stock and machinery are sold separately in clearing sales and then the land and buildings are sold afterwards. Selling the farm land in these circumstances may not constitute the sale of a going concern. The amendments will ensure that the separate sale of farm land, including improvements, will be GST free.In addition, to remove any practical difficulties for business under the government's proposal to reduce the 32 per cent wholesale sales tax to 22 per cent, I will also be moving amendments to specify a change to the date of effect of this measure. The reduction of the 32 per cent rate will come into effect 21 days after the date on which the GST bill receives royal assent. This is in response to concerns from businesses that they need sufficient notice to implement the necessary changes, such as altering prices.The amendments we are proposing reflect the consultations which we have had with groups. We believe that they are an appropriate response to issues which have been raised with us. Senator Harradine has raised quite a number of questions in the debate. I will make sure that a response is given to those questions.The committee stage of the debate is a time to outline the general positions and general principles that various parties in the Senate are adopting. The government's position is quite clear: we believe that we need major reform of the tax system. The Labor Party position is equally clear; it is utterly opposed to reform. The Labor Party went to the election with a very poorly thought-out and poorly developed tax policy and was appropriately defeated. They wasted their first period in opposition and I think they were judged correctly by the public.I believe the Democrats have come to this debate recognising that the tax system is broken. The Labor Party does not accept that. The Labor Party thinks that Australia has a great tax system. We do not.RF4COOKSenator Cook—We want reform without the GST.WW4Kemp, Sen RodSenator KEMP—The Labor Party does not want reform. The Labor Party has no alternative plan. The poorly thought-out issues which were developed on a piece of paper and put to the Australian public were treated with contempt by them, and rightly so because the Labor Party refused to do the work. Typically of the Labor Party, it says no to everything but when you ask it what its alternatives are it does not have any solutions. The Democrats, I believe, have come to this debate recognising that reform must take place—that is light years ahead of the Labor Party position.It is very clear from issues raised today by Senator Murray that there is quite a deal of difference between the government's position and the Democrats' position on a number of quite fundamental issues. Nonetheless, we recognise that the Democrats are seeking to raise issues and in the committee stages undoubtedly we will have a vigorous debate on those particular matters.I regret that in many ways the Greens seem to have excluded themselves from major debates in the Senate. That may not be apparent from the amount of time which is taken up with debates with Green senators. The truth of the matter is that the two Green senators have a balance of power position in the Senate. It is a great pity that the Green senators relentlessly align themselves with the Labor Party.ZW4SHERRYSenator Sherry—Not on everything.WW4Kemp, Sen RodSenator KEMP—On just about everything. Senator Sherry is embarrassed by the company he so often keeps, and quite rightly.ZW4SHERRYSenator Sherry—No, I'm not embarrassed.WW4Kemp, Sen RodSenator KEMP—Because of that embarrassment, I am very glad I raised that issue. We have noted how often the Greens support the Labor Party position. I think it is a great pity that Senator Margetts and Senator Bob Brown do not take part in the wider debates. It is a great pity that you do not encourage wider discussion and negotiation with the government on issues.DX5MARGETTSSenator Margetts—So does that translate to selling out?WW4Kemp, Sen RodSenator KEMP—Senator Margetts, you have had your say and I might have mine, if you don't mind. I think it is a pity. The Democrats differ from us, but we have discussions. The Independent senators will differ, but discussions occur on many issues. Some of those issues are resolved; others are not. No discussions ever occur with the Green senators. We sit in this chamber and listen to reams of amendments and a torrent of words but the Green senators achieve absolutely nothing, despite the fact that they have the balance of power in the Senate.Senator Brown interjecting—WW4Kemp, Sen RodSenator KEMP—I am sorry about that, Senator Brown, but when people review what has happened over the last three years and they say, `What did Senator Brown achieve and what did Senator Margetts achieve?' it will be the shortest list of any senator in this chamber. I think that is a pity, and I put that on record. So I think that as the second reading debate moves to an end—DX5MARGETTSSenator Margetts—I bet you I got more amendments up than you in the whole time you were in opposition.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Murphy)—Order! Minister, would you ignore the interjections.WW4Kemp, Sen RodSenator KEMP—Thank you, Mr Acting Deputy President. Unfortunately, I seem to have provoked the senator. Anyway, my remarks stand on the record and others will judge them.Senator Margetts interjecting—WW4Kemp, Sen RodSenator KEMP—People will judge your records, Senator Brown and Senator Margetts, and they will judge mine. As I said, the second reading debate now comes to an end. There have been many issues which have been raised in the second reading debate. I have no doubt that these are going to be fully canvassed in the hours, days and weeks ahead. Given that the government have a mandate, given that we have put a plan before the public—this plan has been fully discussed, debated and voted upon; we have had the most extensive Senate inquiries in history—we believe that the time has come for the debate to progress, we hope with due speed, so that the Australian people can look forward—ZW4SHERRYSenator Sherry—You are ready to go, are you? WW4Kemp, Sen RodSenator KEMP—We are ready to go, Senator, but I think there are others that are not quite ready. I leave the detailed arrangements to the Manager of Government Business. I commend these bills to the Senate. They are very important bills, they are major reform bills and they are bills which will bring great benefit to our nation and to Australians.RF4COOKSenator Cook—Mr Acting Deputy President, I would like to propose that when the question that the bills be read a second time is put, the bills Nos 1 to 6 as listed on today's Notice Paper be put separately and as one block.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Murphy)—The chair will carry that request at the request of any senator. That will be done. Minister, you seek some clarification?WW4KEMPSenator Kemp—Would you explain what is meant by `put separately and as one block'?RF4COOKSenator Cook—I am proposing that when the question is put that the bills be read a second time, bills Nos 1 to 6, as listed in today's Notice Paper , which are the substantive bills, be put separately and that the block of bills Nos 1 to 6 be the first block to be dealt with.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—As I said, the chair will divide the question at the request of any senator, and that is what we will do.11:21:003987Margetts, Sen DeeSenator MARGETTSDX5WAG(WA)00—I seek to move an amendment to the Labor Party's second reading amendment.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—Is this one that you have foreshadowed?DX5Margetts, Sen DeeSenator MARGETTS—No.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—You need leave.DX5Margetts, Sen DeeSenator MARGETTS—I seek leave.Leave granted.DX5Margetts, Sen DeeSenator MARGETTS—In order for me to support the Labor Party's amendment, I would seek to amend it by deleting part (b). I move:Omit paragraph (b). I seek leave to briefly explain that.Leave granted.DX5Margetts, Sen DeeSenator MARGETTS—I thank the Senate. Just briefly, it is about the emphasis on applauding the efforts by, in effect, the Keating Labor government to maintain or emphasise a low inflationary economy in Australia. There are many issues in relation to that, including the fact that the accord did not keep up with the profit levels of many corporations. In relation to unemployment, I think the issue is that often inflation was put above unemployment. So from the point of view of the Greens (WA), we would not like that to be seen as a particular issue that we applauded, because it needs to be so qualified that it becomes meaningless. Therefore, I would be happy to support the rest of the Labor Party's second reading amendment, but first I would like to have it amended by the deletion of part (b).11:22:003988Harradine, Sen BrianSenator HARRADINE6H4TASIND00—by leave—I just say that this seems to me to be an unhelpful process. I can understand the opposition making certain points about the matter, but it seems to me to be quite unhelpful to the way things are ultimately to proceed. I expressed my view about matters during my second reading contribution, and no doubt everybody else did as well. I am concerned about the rushing of this measure. I think tax matters should be considered very carefully, and other honourable senators will say, `They have been.' Even those who will be principally affected by the Ralph committee's examination of the measures that were contained in the package itself are calling for time. They say that the reforms are too vital to rush. I think these reforms being proposed here are too vital to rush, and I do not believe that the proposals that have been put forward by the opposition will assist in that.If the government is insisting that the matters be considered by the Senate, I am not in a position to oppose its right to insist on that. I believe that in the long run it will be seen, possibly even by the government, that it is more appropriate for the matter to be given further consideration and not to be governed by a date deadline, which appears to be the case at the moment. If voting for this amendment by the opposition means that that is the end of the matter at this point in time, I cannot support that, although I am in favour of a number of the aspirations that are in some of these amendments.11:26:003988Murray, Sen AndrewSenator MURRAY3M6WAAD00—by leave—The amendment proposed by Senator Margetts does not address the fundamental intent of this amendment, which is, effectively, to wipe out the bills to be considered because it says, `Omit all words after "That".' I know that the Labor Party has paid a great deal of serious attention to the ANTS package through the various committee processes over the months that have passed, as indeed have Senator Margetts and Senator Harradine. It seems to us that the government has every right to argue that its legislation should be considered, and the appropriate time for the decision as to whether to reject it is during the third reading debate when the amendments will either be satisfactory to the Senate and the government or they will not. So the problem with Senator Margetts's amendment is that it does not deal with the fundamental issue. So I foreshadow, as you would expect, that the Democrats intend to argue that the bills do go to committee stage and are properly considered at amendment. Therefore, to us, Senator Margetts's amendment is almost irrelevant for that reason. So I put that point of view, and we will see how it proceeds from there.11:28:003988Cook, Sen PeterSenator COOKRF4WAALP00—by leave—I note and respect the remarks made by those senators who by leave have intervened in the debate again. I would like to very briefly make some points on what has been put. Firstly, we will not be accepting the amendment to our amendment from Senator Margetts of the Greens (WA). We think it is appropriate to state the record on this. I am disappointed that the Greens (WA) feel that that is not the case, but I do trust that if their amendment is not successful they will feel able to vote for the substantive motion. But that is a matter to be arrived at very shortly.Senator Harradine has raised a point. I respect the remarks he has made. From the Labor Party point of view, it is a matter of fundamental principle that Australia should have tax reform but it should not have a GST. The most profound way we can state that is by rejecting the bills at this stage. That is what we would prefer this Senate to do and I hope the Senate can find itself obliged to support us. My remarks to the Democrats are the same. I understand that they have foreshadowed a number of amendments to the legislation; we simply believe that you cannot make this legislation fair and, therefore, we insist on our amendment.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Murphy)—The question is that the amendment moved by Senator Margetts to Senator Cook's proposed amendment be agreed to.Question resolved in the negative.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—The question is that the amendment moved by Senator Cook in respect of A New Tax System (Goods and Services Tax) Bill 1998 be agreed to.11:35:00The Senate divided. (The President—Senator the Hon. Margaret Reid)22Bishop, T. M. Bolkus, N.Brown, B. Campbell, G.Carr, K. Conroy, S.Cook, P. F. S. Cooney, B.Crossin, P. M. Crowley, R. A.Evans, C. V. Faulkner, J. P.Forshaw, M. G. Gibbs, B.Hogg, J. Lundy, K.Mackay, S. Murphy, S. M.O'Brien, K. W. K. *Ray, R. F.Sherry, N. West, S. M.40Allison, L. Alston, R. K. R.Bartlett, A. J. J. Bourne, V.Brownhill, D. G. C. 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. Heffernan, W.Herron, J. Kemp, R.Knowles, S. C. Lees, M. H.Lightfoot, P. R. Macdonald, S.MacGibbon, D. J. Margetts, D.McGauran, J. J. J. Minchin, N. H.Murray, A. Newman, J. M.O'Chee, W. G. Parer, W. R.Patterson, K. C. L. Payne, M. A.Reid, M. E. Synon, K. M.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W. Woodley, J.Collins, J. M. A. Hill, R. M.Denman, K. J. Boswell, R. L. D.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Quirke, J. A. Stott Despoja, N.Schacht, C. C. Macdonald, I.* denotes tellerQuestion so resolved in the negative.10000Cook, Sen PeterThe PRESIDENT—The question is that the amendment moved by Senator Margetts in respect of A New Tax System (Wine Equalisation Tax) Bill 1999 be agreed to.11:39:00The Senate divided. (The President—Senator the Hon. Margaret Reid)2Brown, B. Margetts, D. *53Alston, R. K. R. Bishop, T. M.Bolkus, N. Brownhill, D. G. C.Calvert, P. H. Campbell, G.Campbell, I. G. Carr, K.Colston, M. A. Conroy, S.Cook, P. F. S. Coonan, H. *Cooney, B. Crane, W.Crossin, P. M. Crowley, R. A.Denman, K. J. Eggleston, A.Ellison, C. Evans, C. V.Ferguson, A. B. Ferris, J.Forshaw, M. G. Gibbs, B.Gibson, B. F. Heffernan, W.Herron, J. Hogg, J.Kemp, R. Knowles, S. C.Lees, M. H.Lightfoot, P. R.Lundy, K. Macdonald, S.MacGibbon, D. J. Mackay, S.McGauran, J. J. J. Minchin, N. H.Murphy, S. M. Newman, J. M.O'Brien, K. W. K. O'Chee, W. G.Parer, W. R. Patterson, K. C. L.Payne, M. A.Ray, R. F.Reid, M. E. Sherry, N.Synon, K. M. Tambling, G. E. J.Tierney, J. Troeth, J.Vanstone, A. E.Question so resolved in the negative.10000PRESIDENTThe PRESIDENT—The question now is that the amendment moved by Senator Brown in respect of A New Tax System (Goods and Services Tax Transition) Bill 1998 be agreed to.11:44:00The Senate divided. (The President—Senator the Hon. Margaret Reid)2Brown, B. Margetts, D. *54Alston, R. K. R. Bishop, T. M.Bolkus, N. Brownhill, D. G. C.Calvert, P. H. Campbell, G.Campbell, I. G. Carr, K.Colston, M. A. Conroy, S.Cook, P. F. S. Coonan, H. *Cooney, B. Crane, W.Crossin, P. M. Crowley, R. A.Denman, K. J. Eggleston, A.Ellison, C. Evans, C. V.Faulkner, J. P. Ferguson, A. B.Ferris, J. Forshaw, M. G.Gibbs, B. Gibson, B. F.Heffernan, W. Herron, J.Hogg, J. Kemp, R.Knowles, S. C. Lightfoot, P. R.Lundy, K. Macdonald, S.MacGibbon, D. J. Mackay, S.McGauran, J. J. J. Minchin, N. H.Murphy, S. M. Newman, J. M.O'Brien, K. W. K. O'Chee, W. G.Parer, W. R. Patterson, K. C. L.Ray, R. F. Reid, M. E.Sherry, N. Synon, K. M.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W. West, S. M.Question so resolved in the negative.10000PRESIDENTThe PRESIDENT—The question now is that the amendment moved by Senator Brown in respect of A New Tax System (Australian Business Number) Bill 1998 be agreed to.11:49:00The Senate divided. (The President—Senator the Hon. Margaret Reid)33Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Carr, K.Colston, M. A. Conroy, S.Cook, P. F. S. Cooney, B.Crossin, P. M. Crowley, R. A.Denman, K. J. Evans, C. V.Faulkner, J. P. Forshaw, M. G.Gibbs, B. Harradine, B.Hogg, J. Lees, M. H.Lundy, K. Mackay, S.Margetts, D. Murphy, S. M.Murray, A. O'Brien, K. W. K. *Ray, R. F. Reynolds, M.Sherry, N. West, S. M.Woodley, J.32Alston, R. K. R. Brownhill, D. G. C.Calvert, P. H. Campbell, I. G.Coonan, H. *Crane, W.Eggleston, A. Ellison, C.Ferguson, A. B. Ferris, J.Gibson, B. F. Heffernan, W.Herron, J. Kemp, R.Knowles, S. C. Lightfoot, P. R.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.Reid, M. E.Synon, K. M. Tambling, G. E. J.Tierney, J. Troeth, J.Vanstone, A. E. Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Quirke, J. A. Boswell, R. L. D.Schacht, C. C. Macdonald, I.* denotes tellerQuestion so resolved in the affirmative.10000PRESIDENTThe PRESIDENT—The question is that the amendment moved by Senator Mackay in respect of A New Tax System (Commonwealth-State Financial Arrangements—Consequential Provisions) Bill 1999 be agreed to.11:54:00The Senate divided. (The President—Senator the Hon. Margaret Reid)33Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Carr, K.Colston, M. A. Conroy, S.Cook, P. F. S. Cooney, B.Crossin, P. M. Crowley, R. A.Denman, K. J. Evans, C. V.Faulkner, J. P. Forshaw, M. G.Gibbs, B. Harradine, B.Hogg, J. Lees, M. H.Lundy, K. Mackay, S.Margetts, D. Murphy, S. M.Murray, A. O'Brien, K. W. K. *Ray, R. F. Reynolds, M.Sherry, N. West, S. M.Woodley, J.32Alston, R. K. R. Brownhill, D. G. C.Calvert, P. H. Campbell, I. G.Coonan, H. *Crane, W.Eggleston, A. Ellison, C.Ferguson, A. B. Ferris, J.Gibson, B. F. Heffernan, W.Herron, J. Kemp, R.Knowles, S. C. Lightfoot, P. R.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.Reid, M. E.Synon, K. M. Tambling, G. E. J.Tierney, J. Troeth, J.Vanstone, A. E. Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Quirke, J. A. Boswell, R. L. D.Schacht, C. C. Macdonald, I.* denotes tellerQuestion so resolved in the affirmative.10000PRESIDENTThe PRESIDENT—The question is that the amendment moved by Senator Carr in respect of A New Tax System (Personal Income Tax Cuts) Bill 1998 be agreed to.11:58:00The Senate divided. (The President—Senator the Hon. Margaret Reid)26Bishop, T. M. Bolkus, N.Brown, B. Campbell, G.Carr, K. Conroy, S.Cook, P. F. S. Cooney, B.Crossin, P. M. Crowley, R. A.Denman, K. J. Evans, C. V.Faulkner, J. P. Forshaw, M. G.Gibbs, B. Harradine, B.Hogg, J. Lundy, K.Mackay, S. Margetts, D.Murphy, S. M. O'Brien, K. W. K. *Ray, R. F. Reynolds, M.Schacht, C. C. West, S. M.33Alston, R. K. R. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Knowles, S. C.Lightfoot, P. R. 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.Reid, M. E. Synon, K. M.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Quirke, J. A. Boswell, R. L. D.Sherry, N. Macdonald, I.* denotes tellerQuestion so resolved in the negative.10000PRESIDENTThe PRESIDENT—The question is that the amendment moved by Senator Carr in respect of A New Tax System (Compensation Measures Legislation Amendment) Bill 1998 be agreed to.12:02:00The Senate divided. (The President—Senator the Hon. Margaret Reid)32Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Carr, K.Conroy, S. Cook, P. F. S.Cooney, B. Crossin, P. M.Crowley, R. A. Denman, K. J.Evans, C. V. Faulkner, J. P.Forshaw, M. G. Gibbs, B.Harradine, B. Hogg, J.Lees, M. H. Lundy, K.Mackay, S. Margetts, D.Murphy, S. M. Murray, A.O'Brien, K. W. K. *Ray, R. F.Reynolds, M. Sherry, N.West, S. M. Woodley, J.32Alston, R. K. R. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Lightfoot, P. R.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.Reid, M. E.Synon, K. M. Tambling, G. E. J.Tierney, J. Troeth, J.Vanstone, A. E. Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Quirke, J. A. Boswell, R. L. D.Schacht, C. C. Macdonald, I.Stott Despoja, N. Knowles, S. C.* denotes tellerQuestion so resolved in the negative.10000PRESIDENTThe PRESIDENT—The question is that the amendment moved by Senator Carr in respect of A New Tax System (Bonuses for Older Australians) Bill 1998 be agreed to.12:06:00The Senate divided. (The President—Senator the Hon. Margaret Reid)25Bishop, T. M. Bolkus, N.Brown, B. Campbell, G.Carr, K. Conroy, S.Cook, P. F. S. Cooney, B.Crossin, P. M. Crowley, R. A.Denman, K. J. Evans, C. V.Faulkner, J. P. Forshaw, M. G.Gibbs, B. Hogg, J.Lundy, K. Mackay, S.Margetts, D. Murphy, S. M.O'Brien, K. W. K. *Ray, R. F.Reynolds, M. Sherry, N.West, S. M.33Alston, R. K. R. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Knowles, S. C.Lightfoot, P. R. 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.Reid, M. E. Synon, K. M.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Schacht, C. C. Macdonald, I.Quirke, J. A. Boswell, R. L. D.* denotes tellerQuestion so resolved in the negative.10000PRESIDENTThe PRESIDENT—The question now is that the amendment moved by Senator Carr in respect of A New Tax System (Trade Practices Amendment) Bill 1999 be agreed to.12:11:00The Senate divided. (The President—Senator the Hon. Margaret Reid)25Bishop, T. M. Bolkus, N.Brown, B. Campbell, G.Carr, K. Conroy, S.Cook, P. F. S. Cooney, B.Crossin, P. M. Crowley, R. A.Denman, K. J. Evans, C. V.Faulkner, J. P. Forshaw, M. G.Gibbs, B. Hogg, J.Lundy, K. Mackay, S.Margetts, D. Murphy, S. M.O'Brien, K. W. K. *Ray, R. F.Reynolds, M. Sherry, N.West, S. M.33Alston, R. K. R. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Knowles, S. C.Lightfoot, P. R. 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.Reid, M. E. Synon, K. M.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Schacht, C. C. Macdonald, I.Quirke, J. A. Boswell, R. L. D.* denotes tellerQuestion so resolved in the negative.10000PRESIDENTThe PRESIDENT—The question is that the amendment moved by Senator Carr in respect of A New Tax System (Aged Care Compensation Measures Legislation Amendment) Bill 1998 be agreed to.12:14:00The Senate divided. (The President—Senator the Hon. Margaret Reid)32Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Carr, K.Conroy, S. Cook, P. F. S.Cooney, B. Crossin, P. M.Crowley, R. A. Denman, K. J.Evans, C. V. Faulkner, J. P.Forshaw, M. G. Gibbs, B.Harradine, B. Hogg, J.Lees, M. H. Lundy, K.Mackay, S. Margetts, D.Murphy, S. M. Murray, A.O'Brien, K. W. K. *Ray, R. F.Reynolds, M. Sherry, N.West, S. M. Woodley, J.32Alston, R. K. R. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Lightfoot, P. R.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.Reid, M. E.Synon, K. M. Tambling, G. E. J.Tierney, J. Troeth, J.Vanstone, A. E. Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Quirke, J. A. Boswell, R. L. D.Schacht, C. C. Macdonald, I.Stott Despoja, N. Knowles, S. C.* denotes tellerQuestion so resolved in the negative.10000PRESIDENTThe PRESIDENT—The question is that the amendment moved by Senator Carr in respect of A New Tax System (End of Sales Tax) Bill 1998 be agreed to.12:18:00The Senate divided. (The President—Senator the Hon. Margaret Reid)26Bishop, T. M. Bolkus, N.Brown, B. Campbell, G.Carr, K. Conroy, S.Cook, P. F. S. Cooney, B.Crossin, P. M. Crowley, R. A.Denman, K. J. Evans, C. V.Faulkner, J. P. Forshaw, M. G.Gibbs, B. Harradine, B.Hogg, J. Lundy, K.Mackay, S. Margetts, D.Murphy, S. M. O'Brien, K. W. K. *Ray, R. F. Reynolds, M.Schacht, C. C. West, S. M.33Alston, R. K. R. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Knowles, S. C.Lightfoot, P. R. 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.Reid, M. E. Synon, K. M.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Quirke, J. A. Boswell, R. L. D.Sherry, N. Macdonald, I.* denotes tellerQuestion so resolved in the negative.10000PRESIDENTThe PRESIDENT—The question is that the amendment moved by Senator Carr in respect of A New Tax System (Goods and Services Tax Imposition—Excise) Bill 1998 be agreed to.12:20:00The Senate divided. (The President—Senator the Hon. Margaret Reid)32Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Carr, K.Conroy, S. Cook, P. F. S.Cooney, B. Crossin, P. M.Crowley, R. A. Denman, K. J.Evans, C. V. Faulkner, J. P.Forshaw, M. G. Gibbs, B.Harradine, B. Hogg, J.Lees, M. H. Lundy, K.Mackay, S. Margetts, D.Murphy, S. M. Murray, A.O'Brien, K. W. K. *Ray, R. F.Reynolds, M. Sherry, N.West, S. M. Woodley, J.32Alston, R. K. R. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Lightfoot, P. R.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.Reid, M. E.Synon, K. M. Tambling, G. E. J.Tierney, J. Troeth, J.Vanstone, A. E. Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Macdonald, I.McKiernan, J. P. Chapman, H. G. P.Quirke, J. A. Boswell, R. L. D.Schacht, C. C. Knowles, S. C.* denotes tellerQuestion so resolved in the negative.10000PRESIDENTThe PRESIDENT—The question is that the amendment moved by Senator Carr in respect of A New Tax System (Goods and Services Tax Imposition—Customs) Bill 1998 be agreed to.12:24:00The Senate divided. (The President—Senator the Hon. Margaret Reid)32Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Carr, K.Conroy, S. Cook, P. F. S.Cooney, B. Crossin, P. M.Crowley, R. A. Denman, K. J.Evans, C. V. Faulkner, J. P.Forshaw, M. G. Gibbs, B.Harradine, B. Hogg, J.Lees, M. H. Lundy, K.Mackay, S. Margetts, D.Murphy, S. M. Murray, A.O'Brien, K. W. K. *Ray, R. F.Reynolds, M. Sherry, N.West, S. M. Woodley, J.32Alston, R. K. R. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Lightfoot, P. R.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.Reid, M. E.Synon, K. M. Tambling, G. E. J.Tierney, J. Troeth, J.Vanstone, A. E. Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Quirke, J. A. Boswell, R. L. D.Schacht, C. C. Macdonald, I.Stott Despoja, N. Knowles, S. C.* denotes tellerQuestion so resolved in the negative.10000PRESIDENTThe PRESIDENT—The question is that the amendment moved by Senator Carr in respect of A New Tax System (Goods and Services Tax Imposition—General) Bill 1998 be agreed to.12:26:003995Lees, Sen MegSenator LEES8U4SAAD00—by leave—We have had placed before us some 128 amendments this morning. From a brief look through them, I understand that this is an issue, as mentioned in the minister's speech, that has possibly already been dealt with by government. Before we now vote on this, with the amendments that have just been put in front of us, I ask the minister if in fact this is dealt with by the amendments we have.12:27:003995Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I think the insurance people would say that the amendments do not go far enough, in their view.10000PRESIDENTThe PRESIDENT—The question is that Senator Carr's amendment be agreed to.12:32:00The Senate divided. (The President—Senator the Hon. Margaret Reid)32Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Carr, K.Conroy, S. Cook, P. F. S.Cooney, B. Crossin, P. M.Crowley, R. A. Denman, K. J.Evans, C. V. Faulkner, J. P.Forshaw, M. G. Gibbs, B.Harradine, B. Hogg, J.Lees, M. H. Lundy, K.Mackay, S. Margetts, D.Murphy, S. M. Murray, A.O'Brien, K. W. K. *Ray, R. F.Reynolds, M. Sherry, N.West, S. M. Woodley, J.32Alston, R. K. R. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Lightfoot, P. R.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.Reid, M. E.Synon, K. M. Tambling, G. E. J.Tierney, J. Troeth, J.Vanstone, A. E. Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Quirke, J. A. Boswell, R. L. D.Schacht, C. C. Macdonald, I.Stott Despoja, N. Knowles, S. C.* denotes tellerQuestion so resolved in the negative.10000PRESIDENTThe PRESIDENT—The question is that the amendment moved by Senator Carr in respect of A New Tax System (Goods and Services Tax Administration) Bill 1998 be agreed to.12:36:00The Senate divided. (The President—Senator the Hon. Margaret Reid)26Bishop, T. M. Bolkus, N.Brown, B. Campbell, G.Carr, K. Conroy, S.Cook, P. F. S. Cooney, B.Crossin, P. M. Crowley, R. A.Denman, K. J. Evans, C. V.Faulkner, J. P. Forshaw, M. G.Gibbs, B. Harradine, B.Hogg, J. Lundy, K.Mackay, S. Margetts, D.Murphy, S. M. O'Brien, K. W. K. *Ray, R. F. Reynolds, M.Schacht, C. C. West, S. M.33Alston, R. K. R. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Knowles, S. C.Lightfoot, P. R. 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.Reid, M. E. Synon, K. M.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Quirke, J. A. Boswell, R. L. D.Sherry, N. Macdonald, I.* denotes tellerQuestion so resolved in the negative.10000PRESIDENTThe PRESIDENT—We now proceed to foreshadowed amendments. I call Senator Margetts to move her foreshadowed amendment on sheet 1317 in respect of the A New Tax System (Goods and Services) Bill 1998.Amendment (by Senator Margetts) put:At the end of the motion, add:"but that the Senate:(a) notes that: (i) carbon taxes have been applied as the major element of an Ecological Tax Reform Package successfully in a range of European Countries including Denmark, Finland, the Netherlands, Norway, and Sweden with positive outcomes for energy and efficiency; (ii) there has been a significant increase in the use of economic instruments (including taxes, excise and other incentives) in Finland, Belgium, Norway, Sweden, France, the Netherlands, Denmark, Germany, Austria, Canada, the United Kingdom, Japan, and the United States of America, and that the United Nations has noted that the current evidence shows that these instruments have been both environmentally effective and cost effective; (iii) the Blair Labour Government is currently seriously investigating how and at what levels an ecological tax reform package could be introduced in the United Kingdom; (iv) the introduction of a carbon tax would be a large step forward in ensuring the price of fuels reflect their true social and environmental costs and would: (a) reduce use of fossil fuels and related carbon dioxide; (b) increase efficiencies of energy use in general and fossil fuel use in particular; (c) increase the economic attractiveness and substitution of alternative fuels and technologies; (d) provide a stable source of revenue for the development and implementation of strategies for the efficient uses of current energy sources and, increasingly, use of non-renewable sources of energy; (v) payroll tax is a tax on jobs costing Australian businesses over $8 billion per year; (vi) two recent reports commissioned by the Australian Chamber of Commerce and Industry and Australian Business, respectively, from the Allen Consulting Group and Chris Murphy of Econtech call for the abolition of payroll tax; (vii) the "double dividend" of reducing environmental deterioration and increasing employment is achieved if payroll tax is abolished alongside the introduction of a carbon tax; and (viii) the abolition of payroll tax will impact on State revenue and vertical fiscal imbalance and compensation would be required; and(b) resolves that the following matters be referred to the Economics References Committee for inquiry and report on or before the last sitting day in 1999: The need for development of a detailed and fully costed Ecological Tax Reform (ETR) package, with specific reference to: (i) the introduction of a carbon tax and the abolition of payroll tax; (ii) the establishment of a Green Tax Commission to monitor the impact of an ETR package and continue to develop further elements of an ETR package; (iii) introduction, within such a package, of complementary measures including: (a) incentives for: . renewable energy industries; . energy efficiency in products and processes; . motor vehicle fuel efficiency such as differential pricing for: - leaded/unleaded fuels; - gasoline (quality); - diesel (quality); - sulphur content; . long term investments in water conservation and recycling projects; and . cleaner production and waste minimisation; and (b) extra charges on goods such as batteries, plastic carry bags, paper carry bags, disposable containers, tyres, disposable cameras, lubricant oil, oil pollution, solvents and disposable tableware; and (iv) revenue implications for States associated with the abolition of payroll tax and the possibility of directing carbon tax revenue to compensate for this loss.12:40:00The Senate divided. (The President—Senator the Hon. Margaret Reid)8Allison, L. Bartlett, A. J. J.Bourne, V. *Brown, B.Lees, M. H. Margetts, D.Murray, A. Woodley, J.50Alston, R. K. R. Bishop, T. M.Brownhill, D. G. C. Calvert, P. H.Campbell, G. Campbell, I. G.Carr, K. Colston, M. A.Conroy, S. Cook, P. F. S.Coonan, H. Cooney, B.Crane, W. Crossin, P. M.Crowley, R. A. Denman, K. J.Eggleston, A. Ellison, C.Evans, C. V. Ferguson, A. B.Ferris, J. Gibbs, B.Heffernan, W. Herron, J.Hogg, J. Kemp, R.Knowles, S. C. Macdonald, S.MacGibbon, D. J. Mackay, S.McGauran, J. J. J. Minchin, N. H.Murphy, S. M. Newman, J. 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. Reid, M. E.Reynolds, M. Sherry, N.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W. West, S. M.Question so resolved in the negative.10000PRESIDENTThe PRESIDENT—We now proceed to the amendment foreshadowed by Senator Carr printed on sheet 1343 with respect to the A New Tax System (Goods and Services Tax Transition) Bill 1998 .Amendment (by Senator Carr) put:At the end of the motion, add:"but that the Senate condemns the Government:(a) for its failure to present to the Senate all of the GST legislation in the New Tax System package; and(b) for deliberately placing before the Senate only one half of the tax package for consideration, by ensuring that the review of business taxation and any changes to business taxation cannot be considered by the Senate at the same time as the GST".12:45:00The Senate divided. (The President—Senator the Hon. Margaret Reid)31Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Carr, K.Conroy, S. Cook, P. F. S.Cooney, B. Crossin, P. M.Crowley, R. A. Denman, K. J.Evans, C. V. Faulkner, J. P.Gibbs, B. Hogg, J.Lees, M. H. Lundy, K.Mackay, S. Margetts, D.Murphy, S. M. Murray, A.O'Brien, K. W. K. Quirke, J. A. *Ray, R. F. Reynolds, M.Sherry, N. West, S. M.Woodley, J.30Alston, R. K. R. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Knowles, S. C.Macdonald, S. MacGibbon, D. J.McGauran, J. J. J. Minchin, N. H.Newman, J. M. O'Chee, W. G. *Patterson, K. C. L. Payne, M. A.Reid, M. E. Tambling, G. E. J.Tierney, J. Troeth, J.Vanstone, A. E. Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Abetz, E.McKiernan, J. P. Chapman, H. G. P.Schacht, C. C. Macdonald, I.* denotes tellerIn division—BX5GIBSONSenator Gibson—Madam President, I am certain there are some senators who went out after the last division—which was a mickey mouse one—and therefore I suspect it should have been a four-minute bell rather than a one-minute bell.10000PRESIDENTThe PRESIDENT—Nobody called for it, and there had been no debate between the previous division and the next.BX5GIBSONSenator Gibson—I was one and there were others outside also.10000PRESIDENTThe PRESIDENT—Leave could be sought to have the bells rung again, but there had been no debate and we are in a series and one would not expect them to be. But if somebody seeks leave to have them rung again for four minutes, that is a matter for the Senate to determine.WW4KEMPSenator Kemp—I am loath to detain the Senate but, in order to clarify the position, could we get some guidance from the whips as to whether there are people missing. I seek leave to have the bells rung for another four minutes.Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—Order!Senator Conroy interjecting—10000PRESIDENTThe PRESIDENT—Order! Senator Conroy, I am standing up and you should cease shouting. Is leave granted for the bells to be rung for four minutes and this division recommitted?Leave not granted.Question so resolved in the affirmative.10000PRESIDENTThe PRESIDENT—We now proceed to the foreshadowed motion—Honourable senators interjecting—10000PRESIDENTThe PRESIDENT—We are in the process of voting and it proceeds. Unless somebody moves to suspend it, it is appropriate and this is what happens. We proceed with the divisions. We now come to the foreshadowed amendment of Senator Carr, as printed on sheet 1338, in respect of A New Tax System (Australian Business Number) Bill 1998 .Amendment (by Senator Carr) proposed:At the end of the motion, add:"but that the Senate notes evidence given by a joint employer-union submission to the Senate committees examining the legislation that the Australian Business Number will worsen an already serious tax avoidance situation in the building industry estimated to cost $1 billion per year and growing".10000PRESIDENTThe PRESIDENT—The question is that the motion moved by Senator Carr be agreed to.12:52:003999Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—I seek leave for the further votes relating to the second readings of these bills to be deferred till the resumption of government business today.Leave granted.Matters of Public Interest3999399912:54:003999O'Chee, Sen BillSenator O'CHEEEU4QLDNP10—Some weeks ago, 60 Minutes revealed some of the business dealings of the former Prime Minister of Australia in relation to his infamous piggery. It has taken some time for the full implications of the charges that have been made to sink in. This afternoon I wish to deal with extraordinary favours done for the former Prime Minister Paul Keating by the Commonwealth Bank—`the people's bank'. The favours done by the bank to Keating were massive, secret, crucial to a successful sale of his piggery, absolutely unprecedented, entirely improper, unavailable to any other Australian, against the interests of shareholders in the bank and corrupt.The Commonwealth Bank's favours to former Prime Minister Keating are by far the greatest scandal in Australian federal history. When Paul Keating began the sale of his piggery in 1994, the government he led was still the majority shareholder in the Commonwealth Bank. As Prime Minister, Keating was in effect the chairman of the board of the bank's dominant shareholder. Every member of the credit committee of the Commonwealth Bank's board at the time had been appointed by a director of the bank appointed by the government of which Keating had either been Treasurer or Prime Minister.Documents and facts now published lead to one inescapable conclusion: that the CBA did Keating favours which enabled him to sell his interests in his piggery and pocket millions of dollars, even though the piggery remained millions of dollars in debt. The bank, as much as the Indonesians who purchased his piggery, made Keating into a multimillionaire. The bank's favours were also designed to hide forever the deals which made a fortune for Keating.Apart from what was a remarkably soft treatment of an out-of-order piggery account, as well as failure to insist on a guarantee from Keating, here are some of the extraordinary facts which have now emerged. Having found a potential Indonesian purchaser for his half share, Keating faced the problem that the piggery was greatly burdened with debt. In short, he faced the age-old problem that it is hard to get a good price for a business if it is overburdened with debt. And overburdened the piggery was. I seek leave to table a 1995 report by KPMG, which in paragraph 7 declared that, contrary to Keating's claim that the piggery was a first rate asset, the Euphron group of companies could only continue to trade with the support of the group's shareholders and banks.FY5DENMANSenator Denman—We are refusing leave at this stage because I am taking advice, but we may be prepared to give you leave later.Leave not granted.EU4O'Chee, Sen BillSenator O'CHEE—That is very interesting and we will come onto that later. I am sure that the opposition would not want to cover up for the former Prime Minister, but I take Senator Denman's undertaking at face value because she is indeed a very honourable senator. However, the bank did come to the rescue. It enabled the sale process with the first great favour. The bank wrote off nearly $5 million of the piggery's debt. 60 Minutes recently reported that the Commonwealth Bank made provision to write off $4.5 million of the piggery's debts. This provisioning occurred in August 1992. As banking specialist John McLennan noted on the 60 Minutes program, `When it got to that point, or even beforehand, the bank would have pursued every form of additional security to prop itself up that it could. So to turn a blind eye to the potential rich source of security from Mr Keating, in my opinion, is a very unusual situation.' I now seek leave to table a bank document which shows that in May 1994 the Commonwealth Bank indeed did write off $4.9 million of piggery group debt.Leave not granted.EU4O'Chee, Sen BillSenator O'CHEE—Isn't this interesting? $4.9 million of debt—here is the proof—and we are waiting for leave to table the document. We want the facts out, and the document is there. A fascinating feature of this document which I am not allowed to table at the moment is that the write-off is recorded by hand on what is otherwise a word processed document. This suggests that knowledge of the write-off was intended to be kept secret by only those with a need to know. The effect of the write-off was, of course, to improve the financial position of the piggery by almost $5 million.5F4CALVERTSenator Calvert—How much?EU4O'Chee, Sen BillSenator O'CHEE—$5 million, Senator Calvert. Because a write-off is a write-off, banks have rules and procedures governing such matters. Fundamentally, banks only write off debts when they have exhausted all avenues by which they could ever recover those debts. In this case, however, the bank wrote off the debt without any recourse to its security. No effort was made to recover anything from the multimillion dollar purchase price paid by the Indonesians.Generally, it would be expected that write-offs of this amount would go to the credit committee of the bank's board. In this particular case, where the write-off was enormously beneficial to the Prime Minister of the government of the day—the bank's dominant shareholder—there is not the slightest doubt that it should have been referred not just to the credit committee but to the bank's full board. Equally, there is not the slightest doubt that it was not referred to the bank's full board because exposure to the full and proper processes would have doomed it, assuming that its relevance to Keating's sale had been properly acknowledged. It is, however, unimaginable that the write-off would not have been cleared at the highest levels of the bank.Write-offs are normally the end point of a process of recovering when all avenues, including all legal avenues, have been exhausted. Write-offs are not normally in the gift of banks to make special customers rich or to curry favour with major shareholders. Not normally, that is. This extraordinary write-off was a favour, a gift, a present, to the Prime Minister worth millions of dollars—indeed, almost $5 million.The Commonwealth Bank's second great favour or gift or present to Paul Keating was equally extraordinary. Keating and his partner wanted to maximise their take-out of the final settlement of the sale of their shares and Keating's option to the Indonesians. So at final settlement over the Anzac weekend in 1996, the bank came to the party again—this time with a gift worth about $4 million which enabled a successful sale. The gift was in the form of a six-year no-interest loan which the bank extended to the Indonesian purchasers at final settlement.5F4CALVERTSenator Calvert—How do you get those loans?EU4O'Chee, Sen BillSenator O'CHEE—I would like to know too, Senator Calvert. I think Senator Boswell would like to know; he has a few constituents who have got problems with the bank. The loan does not include any balloon payment at the end of the period to recover the forgone interest. On the same night the bank gifted this $4 million, Keating took away over $2 million as his final settlement—all this only weeks after he lost the prime ministership. Think about it hard. The ramifications of this are extraordinary and, one has to believe, entirely unprecedented.Somehow Keating gets his bank to sweeten his sale by giving his purchaser six years of no interest on an old Keating debt. Could anyone else in Australia have gotten such a good six-year no-interest loan? Bankers say they have never heard of anything like this. I invite any other Australian—anyone—who has been able to get such a good deal from the Commonwealth Bank of Australia to come forward and tell us how. For the rest of us, out-of-order loans attract penalties and no gifts, certainly no gifts of interest-free loans.For the thousands of Australians who have been sold up by the Commonwealth Bank, the bank's treatment of Keating must rank as one of the sickest jokes imaginable. I must say that it is almost necessary to suspend disbelief that these things could happen in Australia, but happen they did. Together, the first and second great bank favours were a gift to Keating's piggery worth $9 million. Recently, 60 Minutes posed the question of whether the bank and Keating conspired to blackmail Mr Al Constantinidis to buy his silence about the piggery deals.XE4BOLKUSSenator Bolkus—You've got to be joking.EU4O'Chee, Sen BillSenator O'CHEE—I am not joking, Senator Bolkus, and that is the shame of it. This is not a joke.XE4BOLKUSSenator Bolkus—This is recycled hash.EU4O'Chee, Sen BillSenator O'CHEE—It established that the bank settled its $11-plus million action against Constantinidis—XE4BOLKUSSenator Bolkus—This is recycled rubbish.EU4O'Chee, Sen BillSenator O'CHEE—Well, if you want me to bring something forward which is new—XE4BOLKUSSenator Bolkus—This is recycled rubbish and you know it.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Murphy)—Order! Senator O'Chee, it would be useful if you ignored the interjections and addressed your remarks through the chair.EU4O'Chee, Sen BillSenator O'CHEE—Mr Acting Deputy President, I accept your ruling. If Senator Bolkus wants me to bring forward something which is entirely new, then the Labor Party should give me leave to table the documents that they do not want me to table. They will give me leave to table the documents that prove that the Commonwealth Bank wrote off $4.9 million. But they don't want me to do it because they are gutless and they want to cover up for Mr Keating. That is the fact. They say, `Come up with something new.' You come up with something new and they say, `We're not going to let you table it.' What an extraordinary performance! What an extraordinary bunch of people on the other side! They are as extraordinary as this deal, but let me continue with the facts about this deal. A number of important questions arise out of these allegations.XE4BOLKUSSenator Bolkus—Lump of swine.N26ABETZSenator Abetz—Withdraw it.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—Order! Senator Bolkus, I suggest that you withdraw that.XE4BOLKUSSenator Bolkus—I withdraw but—10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—Thank you. No, there is nothing else.XE4BOLKUSSenator Bolkus—Hold on, I raise a point of order.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—What is your point of order?XE4BOLKUSSenator Bolkus—The point of order is that Senator O'Chee has spent the last 13 minutes or so trying to destroy the reputation of a person by recycling hash that we saw on television a few weeks ago. The fact that he is prepared to get in the gutter in this respect ought to be brought to the attention of the Senate.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—Order! There is no point of order. The standing orders do not provide for the protection of former members. As citizens of this country know, they have rights under the standing orders and provisions of the parliament and those people, including former members, have the right to exercise those rights at some point in time.Senator Abetz interjecting—10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—Order! Senator Abetz, I am not asking for a comment from you. Continue, Senator O'Chee. EU4O'Chee, Sen BillSenator O'CHEE—Thank you, Mr Acting Deputy President. I think your ruling is very perspicacious, because Senator Bolkus is trying to protect Mr Keating. But what is unarguable is the proposition that it was of great benefit to Keating for the bank to write off its claims for $11 million from Constantinidis. By settling for half a million dollars, the bank's action induced Constantinidis to agree not to pursue his legal action against Paul Keating. It also induced Constantinidis to agree to an extraordinary and onerous confidentiality clause in his agreement with the bank, the purpose of which was to cover up all details of the piggery and its dealings with the bank. I say `extraordinary' because the Commonwealth Bank made the write-off of Al Constantinidis's personal debts conditional on his silence on matters to do with the piggery and Paul Keating.Together, the Commonwealth Bank's $5 million write-off, the $4 million no-interest loan and the $11 million cover-up short-changed Australian taxpayers and bank shareholders to the tune of $20 million—all of which benefited Paul Keating. That is a $20 million benefit which, as I said at the outset, was massive, secret and crucial to a successful sale of this piggery. It was absolutely unprecedented, it was entirely improper, it was unavailable to any other Australian, it was against the interests of shareholders in the bank and it was corrupt.I intend to provide these observations together with the new documents, once they have been tabled, to the Attorney-General and the Minister for Justice for consideration of the need to hold an urgent inquiry in relation to these matters and this financial impropriety.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—There is still the request for leave. Is leave still not granted at this stage?XE4BOLKUSSenator Bolkus—No.400213:09:004002Lundy, Sen KateSenator LUNDY7G6ACTALP00—There has been recent comment in the media about how political parties relate to Australia's youth. In particular, there has been some suggestion that Victorian Premier Jeff Kennett is one of the few politicians who understand youth issues. Mr Kennett and his conservative colleagues see the so-called generation X and generation Y in terms of vote buying rather than a policy issue. It is this approach that I believe highlights the absolute lack of sincerity that is expressed by Premier Kennett.It is relevant to note that Mr Kennett came to politics via the advertising industry, which, by its nature, is renowned for treating sectional and identifiable groups in society as demographic targets to be manipulated. That is why Premier Kennett has been the master of the launch, the master of the political stunt and the master of the rhetoric. It is also a direct reflection of why so many young people, and people generally, become even more cynical of politics and politicians in an age when they are seeking leadership and looking for some form of philosophical inspiration in their political leaders, rather than the shallow effort to be seen in the approach that Premier Kennett and others bring to Australian politics.Mr Kennett thinks that if you can get in on the hip stations and go the FM radio route in discussing the trend issues of the day, then you're addressing youth issues. A presence in the popular media is not enough. It is certainly important to be able to reach young people through the mediums that they listen to, respect and enjoy, but it is another to provide and build a policy platform of substance beneath that rhetoric.A perception exists on the conservative side of politics that quality policy development can be somehow substituted with talkback radio commentary and high profile launches and public events. The fact is that neither the federal government nor conservative state governments have produced quality policies and ideas that are pertinent to Australia's youth.Indeed, the coalition's Youth Round Table is an exercise which illustrates how the policy agenda that is absolutely germane to young people is being marginalised and devalued. Thus, we find Minister Kemp talking up his consultation process with the 50 round table members, yet he has publicly stated that the government's policy direction will not be influenced by any recommendations arising out of the Youth Round Table. In fact, what we see is the establishment of a publicly funded focus group for the benefit of the federal government, without any opportunity for formal recognition of the endeavours of the incredibly talented and, I think, focused young people who came together as part of that group.This concerns me greatly because we have previously witnessed the minister bypassing AYPAC, which was the peak youth representative body, primarily because their analysis and input to government was seen as too critical by the minister. Since then, we have seen a peak consultative youth group marginalised in the extreme by this government. Why? Because they actually served the purpose of collating information about young people in this country and collating information about the impact of the policy changes experienced by the coalition over the last three years.Whilst we sit back and wait to see whether the round table experiment will work, I am also highly critical of the merits of establishing the youth representative body unless you act on the recommendations that evolve from that process. Why? Because it is about credibility and about saying to young people, `We value your input; we value, in political terms, what you have to say about issues and how you feel about the way things are and the way things should be in the future.' If this government is not prepared to embrace the recommendations emanating from youth representative bodies, then it should dispense with its tokenism and rhetoric and admit that youth issues hold no place in its policy platform.Contrast the coalition's marginalisation of youth policy initiatives with Labor's endorsement of the National Youth Congress report, Building the nation, which was launched here last month. The Youth Congress—which is an initiative arising out of the National Youth Initiative, supported by many community groups, including Rotary—formulated a series of recommendations on issues such as the environment, unemployment, crime, homelessness, suicide prevention, education, drugs, multiculturalism and race relations. The Youth Congress also issued a challenge:We challenge the government to have the courage to include us, the youth of Australia, in developing our nation and people. We recommend that the government embraces the recommendations presented in this report, to listen and act upon them with the passion and vigour with which we have developed them.For three days, 300 young people from around the country met here in Canberra. I had the privilege of participating in several aspects of that particular gathering, including a two-hour workshop looking at the issue of drugs. I know that the young people involved were not there because they saw themselves as token contributors to an exercise. They were there because they believed, one, they could make a difference and, two, the work they were doing was absolutely critical to Australia's future. And they are right.The challenges that they brought forth include youth suicide and the drugs issue. Recently Kim Beazley released Labor's illicit drugs discussion paper which canvassed a broad range of policy initiatives that are both realistic and achievable. Events like the Youth Congress are very important to the process that Labor is going through at the moment in policy development. We need to know what young people are thinking and feeling about these issues. Our paper explicitly acknowledges that many young people are prone to experimenting with the boundaries of what they are permitted to do in the context of community standards and the law. We therefore place great emphasis on educational programs that help young people make sensible choices and temper risk-taking activities. It is about empowering young people with the knowledge and the ability to make decisions for themselves, not assuming for a minute that for some reason related to how long we have spent on this earth older people are in a position to dictate the terms and conditions of survival and existence to other generations.Labor also understands that youth suicide and youth crime are frequently born of alienation and dissatisfaction with the structures and policies of society. I come back to my earlier point: it is about how we as political leaders construct our policies and how they reflect the needs of the people that we represent. You cannot treat youth issues in an isolated policy vacuum; conservative governments have failed dismally to create workable policies because that is exactly what they do. To hive off the whole concept of youth policy in one small section of a portfolio area is marginalising youth in the extreme. You cannot approach youth issues without specifically addressing social welfare, health, education, sport and recreation, and then embark on the most hypocritical path to cut funding to all of those areas and then throw money at some form of committee or board structure initiative that is theoretically going to address this issue in one fell swoop.We have seen this too often across a large number of areas here in the ACT with the Liberal leader, Kate Carnell. In response to a community issue or problem that arises, we see yet another board or committee established with a flurry of media attention. Then that issue is put to bed in political terms. There are no solutions developed. Because of the incredible activities on behalf of most conservative governments to disempower and remove the voice of community activists—be they youth, women or people with disabilities—we find that the power balance of how these groups express themselves and contribute to the political debate is affected to their detriment.The damage caused to the social fabric of Australia by the coalition has severely impacted on young people. Imagine this: imagine being a young person today in the midst of the debate about higher education funding. Imagine every day being confronted by the fact that the leader of the country is arguing to cut funding. The subliminal message—and indeed the overt message—to young people is that we do not value them. This is what the government say every time they run education into the ground. Why? Because education is the key to opportunity for young people, not just here in Australia but everywhere in the world. The countries that are getting it right at the moment are the ones that have been brave enough and bold enough—and I say those words sarcastically—to invest in education. Is it not disappointing that in 1999 the coalition has the status of being the only Western democratic government to have reduced education funding on a net basis in the last three years? It is the only one. On the brink of the new millennium where knowledge is going to become the commodity of the future, the thing that draws economic value into nations like Australia is being divested by this government, not invested in. That is a great indictment. Perhaps in historical terms we will look back on this period of coalition government and see the structural damage that has been done by Mr Howard and the coalition government. It seems to me that this government is intent on making victims out of young people. It seems that, through all its policies, with all the focus it has on its launchism and its building of initiatives that are shallow in the extreme, we find a government that is dismantling the social fabric that is there to support young people.Recent studies have showed that the government has been quite effective in doing this. I would like to refer to Rod Cameron's ANOP study which demonstrates that this government's approach is actually having an impact on the values, thoughts and feelings of young people in this country. Why? Because to struggle in this country now is no longer to struggle to get ahead. To struggle in this country now is just to survive. The measure of success for young people is coping. The opportunities for young people to take on challenges and to further themselves through their own endeavours are diminishing because of lack of education, lack of opportunity and marginalisation of those most in need.This study demonstrates that indeed people are looking into themselves. They are becoming introverted in such a way that their survival is contingent upon their activity only, and the notion of social fabric and community support is diminishing in our society.In short, the coalition's approach to young people is based on keeping them out of the big political picture. It is about a framework of policies that reflects not the shape of things to come; that reflects not where the leaders of the future will actually be in terms of environ mental, social and, indeed, economic values. They are taking this country to a place where we have been before, and this is not a place that the young people of today feel comfortable with. But whilst ever they are marginalised and forced, where struggling becomes the symbol of just coping and not actually getting ahead, we find the options become limited.In closing I would like to turn to a more positive note, and there are many positives in youth affairs. The level of initiative, enterprise, dynamism and intellect amongst our young people is actually the key to our future. We need look no further than the intellectually based industries like information technology, biotechnology and environmental technology to find where our economic future lies.We know that the brains behind so many technology firms are not even with the 18- to 25-year-old age group, but with the 15- to 25-year-olds. It is this generation that understands where technological development is going and the value shift from material commodity to intellect, and I look forward to the future.400513:24:004005Calvert, Sen PaulSenator CALVERT5F4TASLP10—Like my colleague, Senator O'Chee, I wish to address some of the recent disclosures about the conduct of the former Prime Minister, Mr Keating. The facts now in the public domain raise questions of the misuse of power for personal gain, illegality, criminal tax evasion, gross impropriety, cover-up and lies. They raise the most serious questions about the corruption of Australian federal institutions which had hitherto been regarded as incorruptible—in particular, but not exclusively, corruption of the prime ministership and the Commonwealth Bank of Australia, as my colleague has already said here today.In the long history since Federation nothing like such serious allegations has ever been raised against any federal minister, let alone a prime minister. Internationally, the allegations are to do with matters which are far worse than Watergate. The allegations, which are to do with the use of the prime ministership for massive personal financial gain, are infinitely more serious than the recent allegations about Bill Clinton. Internationally, the terribly sad—but more accurate—comparison is with banana republic behaviour or with the korruptsi which was commonplace in the Indonesia of Paul Keating's friend, President Suharto.Published statements and documents now on the record raise a clear prima facie case of capital gains tax fraud by Paul Keating. We all know that tax fraud is a criminal offence.XE4BOLKUSSenator Bolkus—Mr Acting Deputy President, I raise a point of order. I know of your earlier ruling with respect to former prime ministers. Obviously, Senator Calvert did not write this speech, because he actually has problems reading it. It was probably written in the Prime Minister's office by Tony O'Leary and that group. Here we have allegations of criminality against people in a situation where the government itself is already saying that these matters are being investigated. I say that it is totally out of order for Senator Calvert to be reading Mr Tony O'Leary's speech into the Hansard when at the same time he is really reflecting very badly on the innocence of an individual.10000Calvert, Sen PaulThe ACTING DEPUTY PRESIDENT (Senator Murphy)—Order! Senator Bolkus, there is no point of order.5F4Calvert, Sen PaulSenator CALVERT—I just make the point that this is not a Tony O'Leary speech. Firstly, I wish to draw the Senate's attention to the carefully worded memorandum of advice which was drawn up by the Asian advisers to the purchasers of Paul Keating's half share of the piggery. The information in this memorandum is clearly corroborated by other written material. The information is a record of advice from Paul Keating's lawyer, Chris Coudounaris, about how he structured the payment of the $US6 million for Paul Keating's half share of the piggery to avoid possible political repercussions.XE4BOLKUSSenator Bolkus—Mr Acting Deputy President, I raise a further point of order under the standing order that goes to repetition. This speech was made a few months ago before the last federal election.10000Calvert, Sen PaulThe ACTING DEPUTY PRESIDENT—There is no point of order, Senator Bolkus.5F4Calvert, Sen PaulSenator CALVERT—Lawyers who have studied this document regard it as extraordinary. It is rare in tax fraud investigations to see the evidence of intent so clearly spelt out. The explanation is presumably as simple as this, that the Asian advisers to the purchasers were careful people who wanted to get it right. To put it simply, this document is evidence of Paul Keating's intent to defraud the Commonwealth revenues while Prime Minister of Australia.A Gadens Ridgeway trust account statement tabled last year in the Senate is evidence that the scheme or structure which Paul Keating designed to evade tax was on the face of it implemented. The authenticity of this document has not been challenged. For all that, there are many questions about the reality of the transactions.Finally, what Achilles Constantinidis told the Channel 9 60 Minutes program was dynamite. What Constantinidis told Channel 9 was that $1.35 million of the $1.9 million that was injected into a company controlled by him to make it look as if it was an equity injection was in fact paid to Paul Keating. According to Al—and I quote—XE4BOLKUSSenator Bolkus—It is `Al' now, is it? They are good mates.5F4Calvert, Sen PaulSenator CALVERT—Al Constantinidis, and this is quoting from the 60 Minutes program, said:That money did not go to Brown and Hatton Rural.60 Minutes: Well, this document, this trust statement, says it did.Al Constantinidis: Well, I think that trust statement says that it was applied to Brown and Hatton Rural. It physically did not go to Brown and Hatton Rural.60 Minutes: Can you be absolutely sure of that?Al Constantinidis: Categorically.So where did the money go? 60 Minutes uncovered the existence of a second trust account document detailing that $1.2 million of these millions was channelled to a Keating trust company. I seek leave to table this document.Leave not granted.5F4Calvert, Sen PaulSenator CALVERT—The cover-up continues. It is a printed document. It is not a handwritten document like the previous one. But the Labor Party will continue to cover this up, just like the former Prime Minister did. Not even Constantinidis knew of this payment to his partner, the then Prime Minister. Quite obviously, this raises the question of falsification of accounts, a very serious matter. But of even more importance, Al Constantinidis confirmed that the intent to evade tax by the scheme outlined by Keating's lawyer was coupled with an actual transaction as outlined in the scheme.Secondly, I wish to draw the Senate's attention to the fact that it is beyond question that the Indonesian purchaser agreed to pay Paul Keating $US6 million for his half share of the piggery. No problem. Mr Keating himself told Kerry O'Brien on the 7.30 Report last year that he only got a minority of that money. He said that the rest of the money went on fees, payments to the banks, et cetera. From the point of view of capital gains tax it is immaterial, of course, how the recipient of the gain arranges for it to be spent, whether it is on bank debts, running costs or whatever. The gains include capital gains by way of the sale of options.The really important thing is that Paul Keating obviously recognises this point when he asserts how much his partner, Al Constantinidis, got for the sale of the piggery. Mr Keating said that Constantinidis got over $9 million, irrespective of whether some of it went on repayments to the bank. On the other hand, Mr Keating says that he himself got only a minority. Come on, Mr Keating! Pull the other one. Fair dinkum. For him to blame Constantinidis and say that Constantinidis got $9 million and that he himself only got a minority, I find very hard to believe.Does anybody really expect us to believe that Mr Keating's half share partner got more out of the Indonesian purchasers than he got himself? Of course they don't. This is particularly so, of course, when it is recalled that the purchasers were Mr Keating's purchasers, introduced to Mr Keating by Warren Anderson's colleague, John Benson. So they weren't Mr Constantinidis's purchasers; they were ones introduced by Mr Keating himself. The deal was done by Mr Keating and his associates with the Indonesians. Al Constantinidis had nothing do with the workings on the deal with the purchasers. For Al Constantinidis to have got more than Keating from these purchasers is totally unbelievable.In saying that Al Constantinidis got over $9 million it would appear that Mr Keating is also counting as Al's moneys those which were to be channelled through Al to Keating himself. If Mr Keating applied the same logic to what he personally got to what Al Constantinidis got, then he would be owning up to the following: that in 1994 the Indonesians agreed to pay him $US6 million for his half share and, according to Constantinidis, a further $A1 million for his option in 1996, this totalling approximately $US8 million, or well over $A10 million. Paul Keating could only have admitted to this if it squared with what he had told the Australian Taxation Office in the two subsequent years.It is no longer good enough for Mr Keating to refer journalists to his accountants, who he claimed will vouch that his `tax affairs are completely A-okay'. As noted above, when under pressure last year, the same Mr Keating said he only got a minority, that is, less than $3 million. This was some increase on the fictional purchase price that has been spoken about of $US600,000, referred to in the information provided by Chris Coudounaris himself to advisers to the Indonesian purchasers, which was part of the scheme dreamt up to evade tax. However, the fact remains that there is a huge gulf between Mr Keating's admission of only a minority, that is, less than $3 million, and the Indonesians' agreement to pay him in Australian dollars well over $10 million. I think it is quite evident that, even with the limited resources that 60 Minutes have, they have established that he received at least $4 million.So it is time for the former Prime Minister to own up to the allegations of criminal evasion of taxation that he perpetrated on the Australian taxpayer while he was Prime Minister of this country. As mentioned by Senator O'Chee, I too intend to draw these observations to the attention of the Attorney-General.400713:36:004007O'Brien, Sen KerrySenator O'BRIEN8O6TASALP00—This is a government that prides itself on its free trade credentials. The Deputy Prime Minister, in his folksy style, has spent a lot of time travelling from China to Chile, from Gambia to Guinea, from Monaco to Mozambique and from Portugal to Paraguay pushing the interests of Australian industries. Mr Fischer has managed to quite effectively implement a lot of initiatives developed by the previous Labor government and for those efforts he deserves some recognition. But Mr Fischer and his government have absolutely focused on the big end of town. This is the modern National Party of Australia. They have been drawn to the Liberal focus, a focus that is now almost exclusively on meeting the demands of corporate Australia. The latest examples are the recommendations contained in the Ralph report on corporate tax reform.Senators may have seen an article in Monday's Australian Financial Review written by its rural writer, Kathy Bolt. Kathy Bolt reported that the National Farmers Federation, an organisation that also has a reputation for focusing on the big end of the town at the expense of farm families, has formed the view that the Ralph corporate tax package does not look good for Australia's 115,000 farmers. The NFF tax expert Bob Douglas is quoted as saying:We are finding more bad news every day as we talk to officials.So the NFF conclusion is that the tax package takes away from small business and gives to big business. The article also quotes NFF Executive Director, Wendy Craik, as saying:Many of the options included in the [Ralph] discussion paper would make agriculture less internationally competitive, would discriminate against farmers and significantly increase the complexity of the tax system.So Australia's farmers will be the losers out of the government's corporate tax reforms, just as the whole of regional Australia will be big losers from the GST—if it ever gets through the Senate. The only issue is: how big will their losses be?The Deputy Leader of the National Party, Mr Anderson, did in fact put his hand up in opposition to the government's plans to remove accelerated depreciation. But he only put it up once and only when no-one was watching. The National Party will again wait for crumbs from the cabinet table on corporate tax reform, just as it has on every key issue since the 1996 federal election. The hierarchy of the National Party has abandoned the interests of regional and rural Australia. The party has lost one constituency but it has not been able to replace it with another. The Nationals no longer effectively represent the bush, nor do they effectively represent corporate Australia. This is becoming increasingly obvious at the ballot box. One only has to look at the rise of One Nation, and one only has to look back as far as the recent New South Wales state election and the success of the Country Summit Alliance.I note that, following the thrashing handed out to the Nationals in New South Wales, the Deputy Leader of the National Party, Mr Anderson, was reported as attacking his own candidates. In a report in the Sydney Morning Herald on 3 April, Mr Anderson was quoted as saying:There were some very effective campaigns by individuals, coinciding with some not so good campaigning by us.A very frank concession that the Nationals were badly beaten on what was once their very own home turf. So the shift of the National Party's focus to the interests of big business has also been highlighted by a lack of interest in smaller intensive rural industries. In fact, on occasions this lack of interest has developed into outright antagonism towards key regional employers such as pork and chicken producers. The government now ignores the pork industry peak body, the Pork Council of Australia, because it dared to stand up for its members. It was not prepared to accept a third-rate policy response to a first-rate problem that was sending people to the wall—and nor should it.On one occasion, the former Minister for Primary Industries and Energy, Mr Anderson, showed representatives of the Australian Chicken Growers Association the door be cause he did not like what they had to say about the failure of his government to properly and effectively advance their interests. He threw them out of his office. The government was, however, forced to take a closer look at that industry, and the combined resources of the Senate—government senators included—and the industry finally forced a proper policy response. The government was also forced to help pork producers, albeit reluctantly.Madam Acting Deputy President Knowles, it is now time for the Minister for Agriculture, Fisheries and Forestry, Mr Vaile, and the Deputy Prime Minister, Mr Fischer, to help Australia's honey producers, and the first step should be to focus on opening up exports into New Zealand. The honey industry is not a big industry, nor is the New Zealand market for our product a big market, but they are both important. You would recall that in February I raised some concerns about the manner in which Australia had negotiated—or, more accurately, failed to negotiate—access for our honey into the New Zealand markets. Former Senator Collins and I have pursued this issue through estimates processes for some time.I recently received an answer to a question on notice that detailed what had been a very tortuous and, to date, unsuccessful process. A proposal for the export of Australian honey to New Zealand was first provided by the Australian Quarantine and Inspection Service to the New Zealand Ministry for Agriculture and Fisheries—which I will describe as the MAF—on 24 July 1991. In response, New Zealand authorities raised concerns about European foulbrood disease but not chalkbrood disease as the latter was already present in New Zealand. The AQIS proposal of 24 July had, in fact, already addressed the problem of foulbrood by the inclusion of a scientifically based heat treatment regime. The New Zealand authorities formally responded to the AQIS proposal on 20 July the following year.The MAF draft import conditions essentially endorsed the AQIS proposal, including the parameters for heat treatment. According to a letter that accompanied the MAF proposal, it was endorsed by the Chief Veterinary Officer of New Zealand. That letter did refer to the provision of one month to allow for comment from the New Zealand beekeeping industry on the contents of the draft proposal. In October 1992, the MAF advised that it had received technical information in conflict with the draft import conditions for Australian honey. The MAF further elaborated on those concerns and sought detailed documentation on the epidemiology of foulbrood. The MAF wanted more detail on the proposed heat treatment, as well as documentation on the American foulbrood and its presence in both Australia and New Zealand. There was no request for refinement of the heat treatment regime.AQIS provided the information requested by MAF on 11 December 1992. Since then, AQIS has made several inquiries of MAF in relation to finalisation of an import protocol, but MAF has not provided a positive response. In August 1993, MAF proposed to undertake a full quantitative analysis of the risks associated with the importation of Australian honey. That work was, in fact, finalised in January 1994, but it concluded that a number of technical issues remained unresolved. Then, in December 1995, MAF did finally provide a draft decision on the proposal to import Australian honey. The draft decision concluded that Australian honey would be permitted into New Zealand only from areas known to be free of European foulbrood. There was an application from Western Australia, Madam Acting Deputy President—your state; a state free of foulbrood—at the end of last year. MAF responded with yet more technical queries on 12 February this year and again on 23 February. Meanwhile, New Zealand honey continues to come into Australia, as it has done for nearly a decade. It is time that the government applied some resources to resolve this issue.There is a range of reasons why the National Party is in decline, if I follow on from what I have been saying. I have referred to a number of those earlier today, but perhaps to reveal an insight into the problems the National Party faces one has to look at the interview given by the soon to depart Senator Bill O'Chee on ABC radio. Senator O'Chee was interviewed on the program The World Today on 29 March. He was asked what the Nationals could do to overcome the real beating the party copped in rural New South Wales and whether he thought the party could recover. He said that the Nationals could recover because they were the only party that could deliver to regional Australia, whereas Independents like Tony Windsor could deliver nothing. He then said, `That is why we will be as indispensable in the future as we have been in the past.' What smug arrogance! It seems to me that at the point where a politician decides that he or she is indispensable, they are exactly the opposite. To see yourself as indispensable is, in fact, to take the electorate for granted. It is the beginning of the end. And the end for Senator O'Chee is 30 June of this year. Senator Calvert referred to him earlier as `my former colleague', so I guess that is perhaps seeing the end sooner than it really is.400913:46:004009Abetz, Sen EricSenator ABETZN26TasLP10—As we as a nation and as a parliament debate the taxation reform package, the need for fiscal responsibility, industrial reform and other important issues, it is important to take time out to reflect on why we enjoy such unparalleled freedom and wealth. And if we undertake such reflection, our thoughts, of necessity, must go to the preparedness to sacrifice and, indeed, to the actual sacrifices made by hundreds of thousands of Australian service men and women throughout the generations. That willingness to sacrifice and to make oneself available for the defence of one's nation lives on, as was shown so tragically in Malaysia in recent days with the death of two of Australia's finest. As we mourn two of Australia's finest and their families mourn a husband and father, those of us who seek to be of service through public life are confronted with the totality of the commitment made by so many of our service men and women. Our nation's freedoms and wealth have been built on the foundation of sacrifice made by our service personnel.This weekend, Sunday in particular, is Anzac Day, that day of the year we set aside to commemorate the lives of those who were willing to serve their country for the betterment of future generations. The Anzac legend of dedication and commitment, of never giving up against all the odds, is a proud Australian tradition. In an era when certain commentators feel compelled to peddle a distorted black armband version of Australian history, there is a need to remind Australians of our proud history. The story of Simpson and his donkey is a story of selfless sacrifice, a story of single-minded commitment to mates, which ultimately ended in Simpson's own demise at Gallipoli.There is the story of the Rats of Tobruk who repelled the invasion forces, and that of the gallant men who ran the so-called `spud run' to keep the food supplies up to those holding out against the enemy.The story of the selfless sacrifice of Ted Sheean, a fellow Tasmanian who will have one of the Collins class submarines named after him, is another. Sheean was no admiral. He was no high ranking officer. He was simply an ordinary seaman. The fact that the feats of such a person will so appropriately be commemorated is one of the distinguishing features of our Australian ethos and of our society. In his commitment to his mates and country, he was a role model for all of us. Sheean was assigned to the corvette HMAS Armidale as a seaman. On 1 December 1942 she was attacked off Timor. The Sun-Herald of three days ago quoted F.B. Walker, author of HMAS Armidale—The Ship That Had To Die. Allow me to quote from that article. It said:"Ted Sheean, just 27 days short of his 19th birthday, could see his shipmates were being ripped to bits.His ship was being attacked by Japanese warplanes.He was himself unwounded and could have scrambled to some sort of shelter. He could have dived overboard and trusted to luck by duck-diving to escape the bullets."He did none of those things. Instead he scrambled back to the Oerlikon gun abaft the bridge, a distance of some 10 difficult and hazardous metres, thrust his shoulders into the semi-circular grips at the rear of the gun and strapped himself in. "The ship was sinking fast. It was only three minutes since the first torpedo struck until she vanished. The moment Sheean fastened that strap he must have known he would go down with the ship."He poured stream after stream of 20mm shells at the strafing Japanese fighters and sent one cartwheeling into the sea. A Zero flashed in, its guns blazing, and slashed Sheean's chest and back wide open."With blood pouring from his wounds Sheean kept fighting, forcing some of the Japanese planes to sheer away. The ship was now sinking fast and the water was lapping Sheean's feet but still he kept firing."The men in the water gasped in amazement as they saw the bloodstained, desperate youngster wheel his gun from target to target, his powerless legs dragging on the deck."Then came the most incredible sight of all. The ship plunged down and the sea rose up past Sheean's waist to his shattered chest. Still he kept firing. As the gun was dragged into the sea its barrel kept recoiling and shots kept pouring from it."Even when there was nothing left of the ship above water, tracer bullets from Sheean's gun kept shooting from under the water in forlorn, bizarre arcs."It was, said author Walker, an act of sublime, selfless heroism."It was not the result of years of training and discipline—Sheean had been in the Navy only a few short months," Walker said. "He was not acting on orders. It was his decision and his alone. It was not a question of duty—the order to abandon ship had been given and he was free to try to save his own life."He chose to try to save the lives of shipmates and to inflict as much damage on the enemy as he could. It was valour above and beyond the call of duty."It is that selfless sacrifice that we commemorate on Anzac Day. It is not, as some detractors would argue, a glorification of war. It is a genuine commemoration of thankfulness by this nation for those who have sacrificed themselves for our future benefit. I ask all my fellow Australians to celebrate Anzac Day by attending a service in their community to honour those who fought to make this great nation what she is today.Sitting suspended from 1.53 p.m. to 2.00 p.m. Ministerial Arrangements401114:00:004011Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—by leave—I wish to inform honourable senators that the Minister for Regional Services, Territories and Local Government, Senator Ian Macdonald, will miss the first portion of question time due to his aeroplane from Queensland being delayed. Until he arrives, any questions that would normally be directed to Senator Macdonald should be directed to Senator Ellison.14:01:004011Faulkner, Sen JohnSenator FAULKNER5K4NSWALP00—by leave—I make the same point that I did earlier this week. If a minister has been unavoidably delayed, that is accepted by the opposition as an acceptable reason why a minister may not be present at question time. But here again there is the issue of courtesy to the opposition and the Senate. Normally such a matter would be communicated prior to question time. It was not. I think Senator Alston should lift his game.14:01:004011Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—by leave—On the same point, I simply indicate to Senator Faulkner that in normal circumstances that courtesy would certainly have been extended. The trouble is that I was made aware of this matter only minutes ago.UI4RAYSenator Robert Ray—Blame your staff again.LD4Alston, Sen RichardSenator ALSTON—No, I am not blaming my staff. I am simply saying that I was advised. That is all I can say. We then had to arrange for Senator Ellison to fill in.Questions Without Notice401140114011Cook, Sen PeterSenator COOKRF4WAALP00—My question is directed to Senator Alston, the Acting Leader of the Government in the Senate. Can the minister confirm that, in response to a question from Senator Conroy during yesterday's question time, he stated that `no . . . single group will be worse off' under the government's tax package? Can he also confirm that he added, `In fact, they will be better off'? How then does the minister explain his comments later in question time that `81 per cent of people are better off'? Can the minister confirm that, according to his own calculation, this means that the remaining 19 per cent of the Australian population will not be better off? Given the repeated claims by both the minister and the Prime Minister that no-one will be worse off, can the minister advise what methodology he employed to conclude that for close to four million Australians the economic impact of this massive and complicated tax package will be precisely nil?4011Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—We have had quite a long time debating the relative merits of tax cuts.3L6CONROYSenator Conroy—Have you read your brief this time? Stick to your brief.LD4Senator ALSTON—We went right through an election campaign with plenty of material on the table.3L6CONROYSenator Conroy—You stuffed up twice yesterday.10000PRESIDENTThe PRESIDENT—Order! Senator, it is totally outside the standing orders to start interjecting the minute the minister speaks on something that is not even related to the question. I regard your conduct as completely in breach of the standing orders.LD4Senator ALSTON—Thank you, Madam President. Since that famous day, I think more than six months has elapsed. During that time we have had every man and his dog crawling over every detail of our tax proposals. It is simply astounding and beyond belief that Senator Cook would not be aware of the very significant taxation cuts that we were offering to the Australian electorate and that we hope to put into legislation in the near future.What we have said repeatedly is that all Australians earning less than $50,000 will pay 30 cents in the dollar or less tax. In other words, 81 per cent of Australian taxpayers will have a top effective marginal tax rate of 30 per cent—game, set and match. If you are not aware of that statistic, then you obviously did not listen to any of the debate during the election campaign. You have paid no attention to the assessments that have been made since that time.That figure is one that we think very much resonated with the Australian community. They very much understood the benefits of taxation cuts. They did not for a moment like the nitpicking that you offered them because, in terms of tax cuts, you offered them absolutely nothing. All you wanted to do was punish them with capital gains tax changes and the like. They understood well and truly, even if Senator Cook does not, that by reducing the effective marginal tax rate for 81 per cent of the population you have a huge gain for ordinary Australians.4012Cook, Sen PeterSenator COOKRF4WAALP00—Madam President, I ask a supplementary question. Thank you for your bluster, Minister, but would you answer the question I put to you? On your own calculation, 19 per cent of Australians—that is, 14 million people—would not be better off. The question was: what methodology did you use to calculate that figure? Could you just answer that part of the question, please?4012Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—It really is extraordinary. The statement I have made, and it has been made repeatedly by every senior member of the government, is that as a result of our tax cuts 81 per cent of the population will be on a 30 per cent marginal tax rate.UI4RAYSenator Robert Ray—That's not what you said yesterday.LD4Senator ALSTON—That is exactly what I was talking about yesterday, and you know it. We have had all this nonsense all week with you trying to pretend that somehow you can identify a few little people here and there who might conceivably be worse off. We have gone through all that. I have quoted from Mr Costello's very fine article in the Australian Financial Review . You know what we have said ad nauseam about that. Never in my wildest dreams or anyone else's wildest dreams have we suggested that somehow 19 per cent of people might be worse off as a result of a new tax system. It is a preposterous proposal. We have never even thought of it. Why would we? The whole idea of the new system was to ensure that people were not worse off, that we did look after those on low incomes. (Time expired)40124012Crane, Sen WinstonSenator CRANEUW4WALP10—My question is directed to the Minister representing the Prime Minister, Senator Alston. Will the minister inform the Senate of how the government's new tax system will lower income taxes and increase the incentives to work and save? Minister, is the government giving any serious consideration to any proposals to zero rate basic food? Minister, could you please inform the Senate of what a basic food item is and what support is there from the business community for having a uniform tax rate?4012Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—I think the Australian public, apart from a small minority on the other side of the chamber, are very much aware of the benefits.Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—Order!LD4Senator ALSTON—They understand the enormous difference in choice that is facing the Australian people and indeed facing this Australian parliament. What we now have is the third way. You blokes are not prepared to go down that path because you say that Tony Blair has got it wrong, and we can have that debate on another occasion. But we now have the Democrats saying they have found a third way, it is the Irish way. In fact, it is the fruitcake option.Let me make it clear. When Senator Crane asks, `What is basic food?' well I suppose it depends. It is in the eye of the beholder, isn't it? I can remember all those years ago when we had the pilots strike on, and this is a very good example. We were waiting at the back of the Hercules for the luggage to be unloaded when Senator Ray said to then Senator McMullan, `We'd better get a wriggle on, mate.' Senator McMullan said, `Well, the dinner doesn't start until 8 o'clock.' Senator Ray replied, `That's all very well, but we need plenty of time to have a pizza first.'What is basic food? For this bloke, everything is basic food. It never stops. You just go on and on. The Democrats would say, `But, of course, pizzas are packaged food.' But, no, Senator Ray would be smart enough. He would go in and say, `I want the bread and then I want the ingredients—the fresh food ingredients—and I want you to sell them to me separately. Once you've done that, then I want you to heat it up free of charge' and he is around the system in a flash. That is exactly what will happen—an absolute administrative nightmare.The Democrats are now pretending that only 40,000 retailers will be affected by this. The fact is that every restaurant will find it an absolute nightmare because they buy ingredients that are fresh food, they buy some ingredients that are not. So we will have to have two different types of systems. Madam President, you simply cannot go down this path. Senator Lees said that the industry in the UK was the cause of many of the problems in Europe. I would have thought it was the victim. What is food? Bread is a basic essential of life. Well, maybe there are people around who are allergic to bread who cannot use it, so it is not an essential of life. They still manage to survive.Opposition senators interjecting—LD4Senator ALSTON—Well, I can assure you that you might not have too many smart lawyers over on your side, but there will be plenty around earning a very nice living arguing about what is basic food, what is an essential of life and what is fresh food. We have all had stuff sold to us as fresh food and fruit and the like which is anything but. Are muesli bars fresh foods? They are certainly sold as such. What is fresh food? What is health food?The Democrats approach seems to be that this is all about encouraging people to eat better and to live healthier lives. That is a good social engineering agenda, but do not do it through the tax system. Do not simply pretend that somehow your best source of advice, as Senator Lees says, is from health groups such as the Dietitians Association and rural groups such as fruit growers. This is not about deciding what Australians ought to eat or what they ought not eat. If Senator Ray wants to have five pizzas a day, well good luck to him. He should not be penalised through the tax system for doing that. He should simply pay his money up front, as everyone else will be expected to do, and not have a system whereby exempting food ensures that high income earners pay probably twice as much as low income earners for purchasing food. It is a nightmare. It is a totally unworkable approach and it is one that we will not be adopting. (Time expired)40134013Murphy, Sen ShayneSenator MURPHYFX5TASALP00—My question is to Senator Alston, the Acting Leader of the Government in the Senate. I refer to Senator Alston's response to a question from Senator Faulkner on Monday when he said in part:. . . everything he needs to know—that is, about pensioner compensation—and more is contained in an article that appears in the Financial Review today over the name of the Treasurer.Isn't it true that the reference in the Treasurer's article of an up-front four per cent increase in pensions and all other social security payments does not mention that pensioners and beneficiaries will forfeit the next two scheduled automatic indexation payments in September 2000 and March 2001? Will the minister confirm that pensioners and beneficiaries will in fact miss out on these scheduled automatic indexation payments?4013Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—I am sorry if Senator Murphy only managed to read a version that does not give him the full details. The fact is that we will be ensuring that the taxation concessions and the increases in pensions and allowances will fully protect all of those who might be affected. Certainly, pensions and allowances being increased by four per cent and personal income tax rates being reduced will make an enormous difference.There are self-funded retirees who might be outside the tax and social security systems. There will be a one-off aged persons savings bonus which will be available. For fully self-funded retirees there will be a self-funded retirees supplementary bonus. An easing in the pensions income test will mean that many more self-funded retirees will now be eligible to receive some pension benefits. Many self-funded retirees will also benefit from the income tax cuts and an increase in the low income aged persons tax rebate.The fact is that the government is providing real increases in pensions up front from 1 July 2000 rather than as price changes flow through to the CPI. There is also a guaranteed 1.5 per cent real increase in all pensions and benefits on top of the actual CPI impact which will not be clawed back. Need I go on, Madam President? The fact is that all of those groups will be fully protected.4014Murphy, Sen ShayneSenator MURPHYFX5TASALP00—Madam President, I ask a supplementary question. I understood the minister to say that there is a 1.5 per cent increase and that is it. Both the Treasurer and your tax package—the ANTS reform document—imply to the public that they will get a four per cent up-front increase. I asked you, Minister: is it not the case that 2½ per cent of the four per cent will be clawed back? That is the question.4014Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—Around 45,000 people currently not qualifying for the pension on the basis of income will be able to receive a part pension and the pensioner concession card. The fact is, as I have already said, that the 1.5 per cent real increase in all pensions and benefits is on top of the actual CPI impact. So you are covered both ways, whether the increase comes about through wages—and, as you know, we have linked pensions for the first time. That is an historic achievement, something you never managed to do in 13 years.ZW4SHERRYSenator Sherry—We started it.LD4Senator ALSTON—No, you did not. You never linked it to male total average weekly earnings. We have legislated that for the first time pensions will be maintained at 25 per cent. If wages rise faster than prices, then pensions will also be indexed to wages. In all cases, pensioners are more than compensated for the price effects of the CPI with a 1.5 per cent real increase. (Time expired)40144014Macdonald, Sen SandySenator SANDY MACDONALDCX5NSWNP10—I address my question to the Assistant Treasurer. Minister, the government has promised $13 billion worth of personal income tax cuts as part of its tax reform of Australia's outdated and unfair taxation system. Will you inform the Senate of alternative tax plans that have been released of late and could you also inform the Senate what would be the impact of such proposals?4014Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Thank you, Senator Macdonald, for that important question. Senator Macdonald often asks questions related to families and related to the tax system, and we appreciate your interest in this matter, Senator Macdonald. It is true that the wholesale sales tax was raised by the Labor Party when they were last in government, for which there was no compensation package. Those of us who were in this parliament in 1993 can recall the across-the-board rises in wholesale sales taxes and in excises. But I have to point out that no compensation package was offered; in fact, it was the reverse, because the l-a-w tax cuts were abandoned. Therefore, the stance of the Labor Party on the current taxation reform issue certainly smacks of gross hypocrisy.Yesterday the Irish model of GST was proposed by the Australian Democrats. This model zero rates basic food, which I understand in this description includes meat, vegetables, fresh fruit, bread and, for example, could also include tinned caviar. The Democrats' model has generated confusion, as not only bread and bread with dried fruit are Democrats GST free, but what about wholemeal bread, garlic bread, herb bread, rye bread, sourdough—UI4RAYSenator Robert Ray—What about waffles?WW4Senator KEMP—and, indeed, waffles? This is the sort of confusion which has become very clear in the 24 hours since this policy was released. The Democrats' model is highly complex. It would gut the government's plan to deliver major tax cuts to Australian families.The government is offering arguably the largest income tax cuts in Australian history. How can delivering a tax cut in the top marginal rate to some 95 per cent of taxpayers be bad for families? Of course, it is not bad; it is great news for families. The bad news for families is that the Labor Party is attempting to stand in the way of these major tax cuts. As I said in the Senate yesterday, Australian families deserve a tax cut, and the government wants to give them a tax cut in the order of $13 billion. When you relate what we are proposing to do to the policy that was released yesterday by Senator Meg Lees, you see that the Lees model excludes certain products and will cost another $5 billion in compensation.UI4RAYSenator Robert Ray—Who costed that? Who did it?10000PRESIDENTThe PRESIDENT—Order! Senator, there is an appropriate time to ask questions.WW4Senator KEMP—Such a huge cost to the budget would impose very substantial strains and place enormous pressures on interest rates and risk the future prospects of this economy, which has been performing so well.In the government's view the Democrats' Irish model taxes the less fortunate in our community proportionately more than it taxes the rich. For example, the bottom quintile of income earners spends nearly twice as much of their total income on meals in pubs, clubs and hotels than those in higher income groups. The truth of the matter is that what we are seeing, unfortunately, is a policy which favours the rich at the expense of those in the lower income groups. The government is not persuaded by the position that the Democrats put forward yesterday.40154015Faulkner, Sen JohnSenator FAULKNER5K4NSWALP00—My question is directed to the Acting Leader of the Government in the Senate. Does the minister agree with his coalition colleagues Mr Peter Slipper, Mr Ian Macfarlane and Mr Warren Truss that Mrs De-Anne Kelly, by attempting to influence the votes of Independent senators on the sale of Telstra, `acts in a treacherous manner', that her actions are `unwise and disappointing' and that `her comments are shameless' and `amount to political treason'? Does the minister support Mr Macfarlane's view that Mrs Kelly should resign from the National Party and sit as an Independent?4015Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—It is always regrettable if some people are misled by the Labor Party's propaganda in relation to the sale of Telstra. Fortunately anyone who has studied the issue is very much aware of the real benefits that flow to rural Australia. I have to pay tribute to Senator Boswell in particular and the National Party in general. They understand that virtually every other country in the Western world has gone down this track long ago. You used to rabbit on about the Victorian division of the ALP being Albania; the fact is that the whole of the Labor Party has got that sort of 1950s mentality, because the unions tell them—naturally enough.It is a matter of particular concern that anyone would misunderstand. At the end of the day, I suppose we cannot force people to read the detail, to understand what is going on out in rural Australia, to understand all the securities that have been built in: customer service guarantees; untimed local call options; the USO, which delivers otherwise uneconomic services to rural areas. All of these measures are not only in legislation but continue on irrespective of ownership.Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—Order!LD4Senator ALSTON—I think the tragedy is that, rather than be concerned about one person in a rural electorate who may be under particular pressures, it would be a lot better to ask why it is that 27 trade union representatives can get it so fundamentally wrong in one of the most important places in the land. That is the tragedy because one person could always misunderstand but a whole group of individuals should not be able to misunderstand so comprehensively. After all, most of the frontbench here, or a few of them anyway, were members of the last government that privatised everything in sight. I did not hear any qualms from the New South Wales Left on all of that, Senator Faulkner. You knew full well that it was in the best interests of all Australians to go down that path.As Mrs Kernot rightly says, you do not have to worry about Labor in opposition; it is what Labor would do in government that counts. She knows full well what your real position is in relation to Telstra. And I have to commend you because I have noticed a subtle change since poor old Senator Schacht departed the scene. There is a greater degree of realism about the inevitability of those processes and about the fact that you can fully protect people in rural areas, you can ensure that quality of service rises, you can legislate and you have licensed conditions attached which you can impose on all carriers, if necessary. There is currently a general power of direction in relation to Telstra, if that became necessary. So, in all sorts of ways, let us not focus on one or two people out there who might misunderstand; let us focus on those who should know better.4016Faulkner, Sen JohnSenator FAULKNER5K4NSWALP00—Madam President, I ask a supplementary question. I note the minister has indicated that Mrs Kelly is just one individual who apparently has been conned by the Labor Party but, Minster, can you confirm that opposition to the full sale of Telstra is in fact the policy of the whole of the Queensland National Party? You might also consider an answer to this question: when has it been treachery for a member of parliament to argue for the party policy? In this case, Mrs Kelly is arguing—is she not?—for the policy of the Queensland National Party.10000PRESIDENTThe PRESIDENT—Within the question and within the supplementary question there is little that relates to the minister's responsibility, but I call him to answer as he will.4016Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—I presume this is in relation to Telstra, although I do not think we even got beyond the rhetoric and the invective, so one just has to assume. But the fact is that we are not in coalition with various constituent parts of the National Party; we are in coalition with the National Party, which consists of federal members. I have not looked at what resolutions might have been passed by the Queensland division of the National Party. As I understand it, at different points in time they have had different views.Again, it is not surprising that they would pick up some of the rubbish that you peddle around the airwaves and want to give it a decent airing. But, at the end of the day, there can be no doubt that the National Party in the federal parliament is overwhelmingly supportive of the approach we have taken because it knows of the enormous benefits.Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—Order! There is far too much noise on my left.LD4Senator ALSTON—Ask Senator Boswell about the $671 million of social bonuses that are swinging on this issue. (Time expired)40164016Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—My question is to the Minister representing the Minister for Immigration and Multicultural Affairs, and I draw her attention to the report in the Sydney Morning Herald concerning Mr Manuel Carrascalao, an East Timorese whose 18-year-old son was amongst those slaughtered in Dili over the weekend and whose home is being used as a shelter for more than 120 refugees from earlier military violence. The report indicates his request for Australia to provide shelter for those refugees—5K4FAULKNER Senator Faulkner—Do you feel humiliated, Bos?YE4BOSWELLSenator Boswell—What for?10000PRESIDENTThe PRESIDENT—Order! Senator Bartlett, I am sorry to interrupt but there are senators shouting across the chamber. Senator Bartlett.DT6Senator BARTLETT—The report details Mr Carrascalao's request for Australia to provide shelter for those refugees who survived the weekend massacre. Does the minister agree with Minister Ruddock's suggestion that the best course of action for these people who are currently in Dili and East Timor hiding for their life is for them to make an initial approach to the Australian embassy over in Jakarta about their situation? What measures is Australia taking to enable prompt processing of any visa applications of people in East Timor, particularly those who are in reasonable fear of their life?4016Vanstone, Sen AmandaSenator VANSTONE7E4SALPJustice and Customs10—I thank the senator for his question. Senator, I do not have a brief with respect to the matters that you raise. In addition to that, I have not seen the remarks that you say Mr Ruddock has made—and I am not suggesting that they have not been made. I will refer your question to Mr Ruddock, and if I can get you an answer this afternoon I will.4017Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—On a related topic of the government's action in relation to prompt processing of assistance for people in great hardship as a result of armed conflict, I ask the minister presumably also on notice what measures the Australian government has taken to ensure swift processing of applications for special humanitarian and other immigration visas for ethnic Albanians in the Kosovo region and what specific plans have been put in place to promptly deal with Kosovar people wanting to apply for permanent refugee status.4017Vanstone, Sen AmandaSenator VANSTONE7E4SALPJustice and Customs10—Senator, I do have a brief dealing with the Kosovar refugee matter, but it will not be possible to handle all of that in the one minute available to me because there is quite a lot of information. So I think the most efficient way to handle your question is to refer the whole matter to Mr Ruddock. As I say, if I can get you an answer this afternoon, I will as soon as I can.40174017Hogg, Sen JohnSenator HOGG7L6QLDALP00—My question is directed to the Minister representing the Minister for Employment, Workplace Relations and Small Business, Senator Alston. Can the minister confirm reports that the government's preferred employment contracts model, Australian workplace agreements, has been rejected by staff in the policy unit of Mr Reith's own department in favour of a certified agreement? Can he confirm that 30 members of the department's policy unit signed an internal memo which stated:. . . we feel the AWA would lead to a more divided workplace, where trust, openness, honesty and professionalism could be compromised.If members of the minister's own policy unit hold such views of Mr Reith's beloved AWA model, who on earth is advising him as he goes about drafting his next round of draconian workplace reform?4017Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—Mr Reith has taken the best possible advice on this issue, and there is no doubt that Australian workplace agreements are the way to go. I have no doubt that that was a view shared by the Labor Party at one stage. If you remember, after the 1993 election for about five minutes you actually had Mr Keating out there espousing a lot more enterprise based arrangements.Senator Cook interjecting—LD4Senator ALSTON—Well if you are telling me that I should not believe a word Mr Keating says, I would not really want to quarrel with that.RF4COOKSenator Cook—You shouldn't misquote him.LD4Senator ALSTON—The fact is that this is a step forward. You know it, but of course you are locked in the past because you do not have any choice. You are simply trying to ensure that we do not have productivity based arrangements; that we have across-the-board, lowest common denominator approaches that are totally inappropriate in the global community, where there are a lot more competitive pressures around, where competition is a matter of life and death for enterprises and where you do actually need to negotiate on an individual basis.All I can say is that the Labor Party ought to study this issue a lot more closely. If you are interested in mainstream Australia and in encouraging people to keep the fruits of their labour, you ought to embrace tax reform and more flexible workplace agreements. You ought to understand that the real benefits will not flow through to you in electoral terms whilst you bury their heads in the sand.4017Hogg, Sen JohnSenator HOGG7L6QLDALP00—Madam President, I ask a supplementary question. Minister, you failed to address the issues I raised in my question about confirming the establishment of the memo and the fact that the people within the department rejected the Australian workplace agreement. I ask if you would address those questions as well in your answer to my supplementary question. Can you advise the Senate if the views of the policy unit have had the effect of watering down the next wave of reforms to be proposed by Minister Reith, or is the minister still doggedly clinging to the New Zealand experience where, under the Employment Contract Act, individual contracts of the kind rejected by his own staff are the only option available to New Zealand workers? Were the arguments that you put to me in answer to the question put to Minister Reith's staff in the first instance as well?4018Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—The difference is that we believe in choice. Many senior management and other staff in Mr Reith's department have entered into Australian workplace agreements. Consistent with the government's policy, it is open to employees to choose, with their employer, how they want their wages and conditions of employment to be regulated. Some staff have decided they would prefer to remain under the department's certified agreements. Other departmental staff will continue to be offered Australian workplace agreements.At the end of the day, it is their call. We do not impose `one model fits all'. We do not simply have an ideological view of the world that the union movement says, `We want, and we want you to deliver.' We leave it up to the individuals themselves. But, overwhelmingly, we are confident that people will embrace Australian workplace agreements as providing them with a lot more flexibility, a lot more capacity to keep the fruits of productivity gains in the workplace and to get the real benefits that would flow through from improvements. The tragedy is, of course, that you simply do not want to recognise that. (Time expired)40184018Harradine, Sen BrianSenator HARRADINE6H4TASIND00—My question is directed to Senator Vanstone, representing the Attorney-General. I refer to section 55 of the Constitution, which says:Laws imposing taxation, except laws imposing duties of customs or of excise, shall deal with one subject of taxation only . . .I refer the minister to the GST bill. The GST is a multistage tax with refunds. The GST bill, in sections 9 to 10, includes many disparate subjects of taxation, including land transfers, services, transfers of intangible property, and restrictive covenants. Does the A New Tax System (Goods and Services Tax Imposition—General) Bill 1998 breach section 55 of the Constitution? Has the Attorney-General personally been involved in the question of whether or not this is in conformity with the provisions of the Constitution?10000PRESIDENTThe PRESIDENT—Senator Harradine, we interpret quite loosely questions on bills on the Notice Paper . That seems to me to be a fairly precise question on a bill. It also seems to ask the minister to give a legal opinion on a matter relating to the bill and the Constitution. But if Senator Vanstone has anything she wishes to say, she may do so.4018Vanstone, Sen AmandaSenator VANSTONE7E4SALPJustice and Customs10—Thank you, Madam President. All I would say is to basically repeat what you have said. Senator, that question is more properly directed to Senator Kemp.Opposition senators interjecting—7E4Senator VANSTONE—Well it is. Not only is the question, in a sense, absolutely out of order because it relates to a bill before this place—Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—Order! Senators on my left have been persistently shouting during answers this afternoon. That is in breach of the standing orders, and I draw their attention to standing order 203.7E4Senator VANSTONE—As I was saying before hilarity apparently broke out on the other side, such amusement do they think that being in parliament is: for a number of reasons that question is more properly addressed to Senator Kemp. Firstly, it is in my view not a question that is in order because it relates to a bill on the Notice Paper . Secondly, it seeks a legal opinion and it is out of order on that basis. Thirdly, it asks whether the Attorney has been involved in giving any advice. Whenever that question is put to the Attorney-General's Department—as the honourable senator would well know—it is a matter for the department to whom advice is given to disclose the nature of that advice. The Attorney-General's Department does not disclose the advice given to other departments. It is up to the client department to disclose that advice. So I am sorry, Senator; I will refer your matter to the Attorney, and if he chooses to answer it he will.40194019Forshaw, Sen MichaelSenator FORSHAW656NSWALP00—My question is directed to Senator Alston, the Minister representing the Minister for Trade and also the Minister for Agriculture, Fisheries and Forestry. Is the minister aware that his colleague the Minister for the Environment and Heritage is proposing to remove the current blanket exemption for fish exports from the provisions of the Wildlife Protection (Regulation of Exports and Imports) Act? Is the minister also aware that Senator Hill then plans to subject each species in each fishery, both state and Commonwealth, to a review to determine the sustainability of the resource? Can the minister confirm that, if a species loses its exempt status as a result of this process, that species can only be exported if Senator Hill, the minister, or his delegate specifically approves each individual shipment?4019Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—I have to say that Senator Forshaw knows a lot more about this issue than I do and I will take it on notice.4019Forshaw, Sen MichaelSenator FORSHAW656NSWALP00—Madam President, I ask a supplementary question. I note the response from the minister who represents the ministers for those areas in this chamber and I point out that the various state fisheries ministers certainly know a lot about this issue and you should also, Minister. My supplementary question is this: what impact will this plan to impose export controls on the Australian fishing industry have on exports that are worth in the order of $1.5 billion per year? Does the minister agree that Senator Hill already has a number of options to protect a fish species if he considers that species to be endangered and therefore this plan to introduce export controls is environmentally unnecessary and economically inappropriate? Minister, isn't this proposal to create a new export control power over such a major export industry inconsistent with your government's policy of removing controls over exports?4019Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—We are not in the business of imposing unnecessary regulation or going down a path that might be quite unnecessary. If there is a need for export controls because of problems that have arisen in the regulation of the industry, then I am sure Senator Hill will find it necessary to go down that track. If, on the other hand, he does have the options that you say are open to him, then no doubt he will examine those first.40194019Eggleston, Sen AlanSenator EGGLESTON4L6WALP10—My question is directed to the Minister for Industry, Science and Resources. The Howard government has been a strong supporter of innovation and Australian researchers. Will the minister advise the Senate of recent government initiatives to assist industry—Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—Order! There are senators on my left shouting across the chamber. I require you to desist.4L6Senator EGGLESTON—It is disgraceful behaviour, Madam President. How can we possibly get a question over?Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—The Senate will come to order.4L6Senator EGGLESTON—Will the minister advise the Senate of recent government initiatives to assist industry to work with the research sector?4019Minchin, Sen NickSenator MINCHINJX4SALPIndustry, Science and Resources10—I thank Senator Eggleston for his question and I would appreciate the senators opposite treating all senators with a bit more decorum and civility. It is the case that the 13 years of Labor rule are generally regarded as wasted opportunities in Australia, but there were some rare exceptions. One of those exceptions to that 13 years of wasted opportunities was the decision by the former Labor government to establish the Cooperative Research Centre program—an idea devised by Professor Ralph Slatyer and very sensibly adopted by the then Hawke government in 1991. It is a program which the coalition is fully committed to. So I was very pleased last Friday to announce the 26 recipients of the sixth round of funding under the Cooperative Research Centre program.This is a program designed specifically to encourage collaboration between industry, education institutions and government leading to the development of state-of-the-art research and the eventual commercialisation of the technologies developed. With the inclusion of the four new centres announced on Friday, there are now 65 cooperative research centres across Australia. They exist in every state and territory within the targeted industry sectors of manufacturing, information and communications, mining and energy, agriculture and rural based manufacturing, the environment and medical science and technology. The total research investment for this round of funding is $1,866 million over a seven-year period of which the Commonwealth will contribute $397 million. More than 200 companies will contribute $419 million and other CRC participants will contribute $1,050.A very good recent example of the opportunities for the commercialisation of CRC innovation was the launch by CIBA Vision and the Eye Research and Technology CRC of an extended wear contact lens which can be safely and continuously worn for up to a month, 24 hours a day. The worldwide market for contact lenses is currently worth about $US4 billion and it is estimated that that will exceed $US8 billion within seven years. It is estimated that this new lens could capture at least half of that market.The CRCs are only part of our contribution to the development of innovation in Australia. We have a very strong commitment to scientific research. We have acted to restore the $20 million per annum to the base funding of the CSIRO that was regrettably pulled out of the CSIRO by the former Labor government. We strongly support public sector R&D spending. We committed $3.1 billion in budget funding in 1998-99 and we have delivered rises over the past three budgets despite Labor's legacy of debt.Senator Lundy interjecting—10000PRESIDENTThe PRESIDENT—Order! There is an appropriate time to pursue the matter.JX4Senator MINCHIN—On top of this we are very strongly supporting business innovation including research, research commercialisation and technology diffusion through measures such as the R&D tax concession, R&D Start grants, innovation investment funds and the technology diffusion program. Around $1 billion of new funding for these purposes was announced in our 1997 `Investing for growth' statement and this year we increased total support for innovation in industry by 13 per cent to over $600 million.It is pleasing to see a much more refreshing attitude towards these issues from the new shadow minister for industry, Mr Bob McMullan—a very refreshing change from the attitudes of the past announced by Mr Simon Crean in his position as shadow industry minister. The CRC program is a very good example of the fostering of industry relevant research and consequent industry innovation and improved competitiveness.40204020Crowley, Sen RosemarySenator CROWLEYZF4SAALP00—My question without notice is directed to the Minister representing the Minister for Health and Aged Care, Senator Herron. Does the federal government continue to support naltrexone clinics for heroin addicts? In particular, is the minister aware that Victoria's only naltrexone clinic is seeking to take on an extra doctor and expand its facilities in order to provide assistance to heroin addicts? Does the minister support the provision of these services to heroin addicts in Victoria or does the minister sympathise with those whose opposition to such clinics is based on the `not in my front yard principle' simply because of the unkempt nature of some of the clients using the facilities?4020Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—Senator Crowley raises a very important question about naltrexone and its availability. Naltrexone is registered for two uses in Australia: as part of the treatment program for alcohol dependence and to assist in the maintenance of patients who have stopped using opioids such as heroin and morphine. The government is acutely aware of the plight of many people who are addicted to heroin and the consequences of this addiction for the wider Australian community.The government is also committed to obtaining independent advice through the Pharmaceutical Benefits Advisory Committee on the cost-effectiveness of any drug before it can be subsidised on the Pharmaceutical Benefits Scheme. This is consistent with the government's commitment to making evidence based decisions on Pharmaceutical Benefits Scheme listings.In view of the importance that the government places on the proper management of heroin addiction, it has decided to give high priority treatment to naltrexone by fast-tracking its consideration of the subsidy on the Pharmaceutical Benefits Scheme. Officers of the department are working closely with the sponsor of the drug, who is assembling the necessary evidence in support of its application.3L6CONROYSenator Conroy—Answer the question.VW4Senator HERRON—Following the consideration of this evidence, the pharmaceutical benefits subsidy could occur from August this year—much earlier than the standard approach.For Senator Conroy's information, I have no brief in relation to the particular instance that Senator Crowley has referred to. I will refer that to the minister to get further advice on that for Senator Crowley. I thought it was important, however, to seize the opportunity to state that it is being fast-tracked for consideration. The application for the Pharmaceutical Benefits Scheme listing can relate only to one or both of the purposes for which naltrexone is registered in Australia—namely, as part of a treatment program for alcohol dependence and/or to assist patients who have stopped using opioids such as heroin or morphine.40214021Allison, Sen LynSenator ALLISON1M6VICAD00—My question is to the Minister for Communications, Information Technology and the Arts. I refer to the fact that the brokers used by the government for the first one-third sale of Telstra dramatically undervalued the issue price of the shares. Does the minister recall that, at close of business on the first day of trading, Telstra's instalment receipt stood at a premium of 67c, 34 per cent above the institution instalment price of $2, and that, since the sale, instalment receipts have risen by more than 160 times the all-ordinaries index? Will the minister now admit that this undervaluation by brokers short-changed Australian taxpay ers, delivering a $21 billion windfall gain to overseas investors and to just 10 per cent of the Australian population?4021Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—I think Senator Allison has managed to get it wrong on every count. The great bulk of the investors in the first float of Telstra were domestic, not foreign. Of course, as you would be aware, around the world it is not just telecommunications stocks but those that use telecommunications platforms that have been going through the roof. So the notion that somehow with hindsight a couple of years later you can look back and say—Senator Allison interjecting—LD4Senator ALSTON—I hear you say 160 times the index, but that does not sound intuitively right to me. You may mean 160 per cent. In any event, whatever numbers you are using, you simply cannot possibly look back now and say we should have asked for more. You make your judgment at the time. It is always going to be the case that you cannot be precisely sure what premiums investors will place on the dominant player in the marketplace.This was a unique offering. No-one had ever had the opportunity to invest in Telstra before. There might have been many views around as to its likely potential and there were many who probably took the view that, having been a monopolist for so long, it might not be able to withstand competition in the way that it has obviously proven that it can.There are all sorts of judgments to be made when it comes to listing. I know you have not the vaguest idea about the factors that drive the setting of an issue price for a float, but the fact is that no-one could possibly have known how that market would take off. It is not just Telstra; it is virtually every stock in the telecommunications sector. We do not have a very substantial Internet sector in this country but, again, we have seen enormous price rises off the back of telecommunications stocks.The notion that somehow you can look back and say that this was clearly underpriced simply ignores the fact that the market makes its own judgments once the issue is on the table. That is exactly what happened here. Investors decided that Telstra had a lot more potential than anyone would have thought at the time. You just look at the estimates that were around. There were not too many people out there at the time saying it was worth anything like the amount of money that it is worth now.AW5CARRSenator Carr—Yes there were. You knew there were. You ignored them.LD4Senator ALSTON—I see; we all did, did we? I can remember what Mr Keating had to say whenever we floated figures. I remember that we put $25 billion on the total value of the company back in 1993 and we were absolutely laughed out of court. The media swallowed Mr Keating's line hook, line and sinker.There have never been accurate estimates of what the market would provide and that is precisely why you allow the marketplace to make a judgment. They take into account factors that you never could and never would, and they have judged in this instance, along with a number of other telecommunications stocks, that there is huge potential in this sector. They are dead right. The telecommunications sector has been growing at three or four times GDP. There is clearly enormous potential for the future. With those streams of earnings it is not surprising, looking back, that the price has risen in the way that it has. But I do not remember too many people at the time who were predicting anything like this increase.4022Allison, Sen LynSenator ALLISON1M6VICAD00—Madam President, I ask a supplementary question. Does the minister agree with the Sydney Morning Herald article written by Mr Mike Seccombe on the weekend which states, `The first part of Telstra privatisation was arguably the biggest rip-off of the public sector by the private and the worst handled float of a formerly public enterprise in Australia's history'? Why has the government appointed exactly the same brokers to manage the sale of the rest of Telstra? Can we look forward to your department defending another massive undervaluation if more of Telstra is sold?4022Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—I read the first couple of paragraphs of that undergraduate bile. I did not bother going any further because it was boringly predictable. I do not think I have ever read anything that could vaguely be described as an impartial assessment of the political scene. I think it is a tragedy that the Sydney Morning Herald continues to employ people who have that sort of sizeable chip on their shoulder.If you think that that is the source of objective evidence about whether the float was successful, it shows you have absolutely no idea. The judgments that are made about those who should be retained to assist in the second round of the float are very much based on their professional capacity and their ability to ensure that all the necessary processes are followed. I have to say that Mr Fahey deserves a AAA rating for the way in which that float went off. It was absolutely without difficulty. It was probably one of the best and most professional performances of any privatisation around the world. I can well understand why we have ended up with substantially the same people handling it the second time. (Time expired)40224022Campbell, Sen GeorgeSenator GEORGE CAMPBELLNB5NSWALP00—My question is directed to the Assistant Treasurer. Has legal advice been sought on whether the government's proposed mechanism for locking in the rate of the GST is ineffective and whether the rate of the GST can be simply changed by an amendment act of the Commonwealth parliament? If so, will the government release that advice and, if not, why not?4022Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I thank Senator George Campbell, a former Vice-President of the ACTU, for that question. NB5CAMPBELLSenator George Campbell—That's right.3L6CONROYSenator Conroy—And proud of it!WW4Senator KEMP—He had to be famous for something, so I felt I would refer to it. If you like, I will mention what Mr Paul Keating said about George Campbell, but I won't bother to do that.10000PRESIDENTThe PRESIDENT—Senator Kemp, I draw your attention to the question.WW4Senator KEMP—We have put in place a mechanism which will provide great assurance to people about locking in the GST rate of 10 per cent. Let me contrast this with the fact that there is no lock-in approach in any act on sales tax or excise duties. That is why the Keating government could come into this parliament in 1993 and increase sales taxes across the board.NB5CAMPBELLSenator George Campbell—Answer the question. Did you seek legal advice?WW4Senator KEMP—Your colleagues, Senator Campbell, increased sales taxes across the board and substantially increased the fuel excises. There was no lock-in at all. These increases were passed by the Senate with the help of the Democrats.The next point I would make is that, having imposed this huge rise in indirect taxes, not an element of compensation was offered. We have had a great deal of discussion in the last couple of days about compensation. In 1993 when the Labor Party came back into office they broke all their election promises. That is in contrast to us, Senator Campbell, we are trying to keep our election promises; we are trying to encourage the Senate to make us keep our election promises. You came in in 1993—10000PRESIDENTThe PRESIDENT—Senator, you should address your remarks to the chair.WW4Senator KEMP—Madam President, the ALP came in in 1993 and broke their election promises. There was no lock-in for the sales taxes and no lock-in for the excises. You would be well aware that the mechanism we have put in place gives great assurances to the public. After all, any rise in the GST would require the approval of all state premiers—that is what it would require—and it would require the approval of the Commonwealth government.5K4FAULKNER Senator Faulkner—Have you sought legal advice?WW4Senator KEMP—Of course, it would also presumably require the approval of the Australian Senate. We are very confident of the mechanism that we have proposed.5K4FAULKNER Senator Faulkner—Have you sought advice?10000PRESIDENTThe PRESIDENT—Order! Senator Faulkner.WW4Senator KEMP—We are very confident of the mechanism that we have proposed. It is certainly welcomed by the state premiers; it is certainly supported by the public. It is in absolute contrast to the wholesale sales tax, which is the Labor Party supported tax.RF4COOKSenator Cook—Answer the question.WW4Senator KEMP—Senator Cook chips in. Well, Senator Cook's second-most famous quote—5K4FAULKNER Senator Faulkner—Madam President, I raise a point of order. I wondered if you had noticed—as I have and as I am sure any objective observer would have—that Senator Kemp has made no attempt to answer the question of whether the government has sought legal advice on the proposed mechanism for locking in the GST. He was asked not only that, as you would be aware, Madam President, but also, if that is the case, whether the government would release the advice; and, if they are not willing to release the advice, why not. He has had three minutes. I would ask you to direct him to actually have a crack at answering the question.10000PRESIDENTThe PRESIDENT—Senator, you know that I cannot direct him on how to answer the question. He must keep to the topic of the question that he has been asked, and I believe he is doing so.WW4Senator KEMP—Thank you, Madam President, for that ruling. I thought that was an entirely appropriate ruling. I am making the extremely important point, which the Labor Party do not seem to understand, that the ALP's wholesale sales tax has no lock-in approach at all. The wholesale sales tax can be increased at the government's will and with the approval of the Senate, which happened in 1993.RF4COOKSenator Cook—You are a disgrace.WW4Senator KEMP—Senator Cook says, `You are a disgrace.'10000PRESIDENTThe PRESIDENT—Order! Senator Cook, I ask you to withdraw that interjection.RF4COOKSenator Cook—I withdraw, Madam President.WW4Senator KEMP—For Senator Cook to make any such comment when Senator Cook is the man who is on record as saying—5K4FAULKNER Senator Faulkner—Sit down.WW4Senator KEMP—He is on record—5K4FAULKNER Senator Faulkner—Sit down.WW4Senator KEMP—as saying that the Labor Party is a high tax party—10000PRESIDENTThe PRESIDENT—Order! The time for answering the question has terminated. Senator Campbell.LD4ALSTONSenator Alston—Madam President, is it appropriate for Senator Faulkner to call out, `Sit down,' on a number of occasions? I would have thought that is a matter for the President.10000PRESIDENTThe PRESIDENT—No, it is in breach of the standing orders.5K4FAULKNER Senator Faulkner—Madam President, I raise a point of order. Is it appropriate for Senator Alston to stand up here and address the chair without taking a point of order or anything else? He has been out of order doing that today; he does it consistently. You should not recognise him in those circumstances and you know it, Madam President. He is not taking a point of order; he is standing up and taking the call in the Senate; and he should not be recognised by you presiding in the chair.10000PRESIDENTThe PRESIDENT—Senator Faulkner, you were out of order, and Senator Alston was out of order in the way he approached that matter. I call Senator George Campbell.4024Campbell, Sen GeorgeSenator GEORGE CAMPBELLNB5NSWALP00—Madam President, I ask a supplementary question. Given that the minister totally ignored the initial question, I ask: does the minister agree that the only truly effective, legal lock-in of the GST rate at 10 per cent would be a constitutional amendment? Isn't it the case that the Howard government is cynically relying on one or more of the states and territories being in pre-election mode and therefore being unwilling to agree to a rate rise? Is the government arguing that it is feasible to have an effective lock-in mecha nism between the states and a bucket of money?4024Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I must say it is very unkind of Senator George Campbell to refer to Premier Carr, Premier Beattie and Premier Bacon in that fashion. I can understand, Senator Campbell, that you may be very upset with the approach that they have taken to the GST, because they are very supportive of the package and the agreement that we have reached with the premiers.Senator Cook interjecting—WW4Senator KEMP—`Tell the truth,' says Senator Cook. If I recall correctly, it was Premier Carr who indicated that the government had a mandate. Governments that go to an election with a clear policy have a mandate to pass their legislation. Senator George Campbell, we think the mechanism we have is a very effective one. Certainly in relation to the Labor Party's wholesale sales tax there is no lock-in at all, so I believe that what we have done is the appropriate way to go. (Time expired)40244024Tierney, Sen JohnSenator TIERNEYO15NSWLP10—My question is to Senator Ellison, the Minister representing the Minister for Education, Training and Youth Affairs. Minister, the Howard government has a very strong commitment to ensuring access, diversity and choice in the higher education system. Will the minister advise the Senate on how the government's improvements in higher education have created more opportunities both for local and overseas students?4024Ellison, Sen ChrisSenator ELLISON9X5WALPSpecial Minister of State10—I acknowledge Senator Tierney's longstanding interest in education, particularly higher education, and I thank him for that very good question. The Howard government has increased accessibility to the higher education sector more than ever before. In fact, in 1999 we have increased fully funded undergraduate positions by 13,000 compared with the last year of funding under Labor in 1996. What this means is that we have increased accessibility to higher education for all Australians.In addition to that, the fee paying options that we have offered to young Australians have resulted in an increase in the number of fee paying students from 787 in 1998 to 1,706 in 1999. This is an increase of 117 per cent. It is clear that Australians are taking up this fee paying option to further their education. But this also makes more funding available to the higher education sector, and when you combine this with the full fee paying domestic postgraduate students—which have increased from just over 20,000 to just under 23,000; some 15 per cent increase—that makes available to the higher education sector some extra $500 million in revenue. That spells only good news for higher education in this country and comes as a result of the Howard government's policies.There are other things too that this government is bringing to the higher education sector. I refer to the voluntary student fees whereby, for the first time, students across Australia will have the opportunity to have freedom of association—freedom to choose whether they pay fees which previously have gone compulsorily to student bodies. These policies are good for Australia and good for the higher education sector.LD4ALSTONSenator Alston—Madam President, I ask that further questions be placed on the Notice Paper .Questions Without Notice4025402515:03:004025Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—Yesterday Senator Mackay asked me a question about Tasmanian health services and their funding, and I undertook to approach the minister to see whether there is any supplementary answer to provide. I seek leave to incorporate it in Hansard .Leave granted.The answer read as follows—SENATOR MACKAY—You may be aware that the Tasmanian government has in fact given up and was forced to sign in relation to the broken promises made by this government. In the light of this further broken commitment to the Tasmanian community, can the minister confirm that the initial offer made to the Rundle Liberal government was a pre-state election bribe? Can the Minister confirm that the Prime Minister never formally withdrew the first offer that he made? Isn't this just another example of this government's complete disregard to honouring promises made to the people of Tasmania?The Tasmanian Premier, the Hon Jim Bacon MHA, wrote to the Prime Minister on 1 April 1999 agreeing to sign an Australian Health Care Agreement on the basis of the Commonwealth's offer of 5 August 1998 the same basis as those jurisdictions that entered into Agreements in August last year.An Agreement has not yet been signed, and reports that it has been signed are incorrect.Commonwealth and State officials are presently finalising several minor details, and I understand it is expected the Agreement will be signed some time over the next few weeks.The Agreement will provide significant increased funding for Tasmania. Through a combination of Health Care Grants and the effect of the new Agreements on Financial Assistance Grants Tasmania will be $25.3 million better off in 1998-99 than 1997-98.402515:04:004025Ellison, Sen ChrisSenator ELLISON9X5WALPSpecial Minister of State10—Yesterday I was asked a question by Senator Bishop in relation to a matter which touched on the Department of Agriculture, Fisheries and Forestry and also the Department of Finance and Administration. I seek leave to incorporate the answer in Hansard .Leave granted.The answer read as follows—Senator Mark Bishop asked the following questions without notice during Question Time on Tuesday 20 April 1999:Question to the Minister representing the Minister for Finance and Administration:Can the Minister confirm that the Government is planning to sell its IT secure gateway environment? What is the reasoning behind this decision? The SGE is the information security system which provides secure transfer of data not only between government departments but between the Commonwealth government and the rest of the world. How does the government justify selling to the highest bidder the IT central nervous system of government information? How does it propose to protect the public and national interest in the continuing security of government information? Supplementary Who will take responsibility if, after the sale, critical government information networks are penetrated?Senator Ellison—The answer to the honourable senator's questions is:The Secure Gateway Environment (SGE) facility currently operated by the Department of Agriculture, Fisheries and Forestry (AFFA) has been offered for sale as part of the application to AFFA of the Government's information technology infrastructure outsourcing initiative. The role within the Finance and Administration portfolio is for the Office of Asset Sales and IT Outsourcing to oversee the outsourcing and sale process.The Secure Gateway facility affords secure gateway access between client agencies and the Internet.The development and operation of secure IT facilities for other clients is not a function or responsibility that AFFA proposes to continue.The sale and outsourcing of this facility supports a policy of creating a market in the provision of this IT infrastructure service so that agencies have the option of alternative service providers and the Commonwealth gains the security benefits of increased dispersion of traffic. All facilities offering secure gateway services will be required to meet stringent certification standards administered on behalf of the Commonwealth by appropriate security agencies.The SGE will only be sold to a bidder who meets the stringent evaluation criteria that have been established. These go well beyond price and are primarily directed at ensuring continuity and improvement of service to the stringent standards of performance and security required of this facility. These criteria are:(a) the successful tenderer demonstrating its commitment to providing continuing services to existing SGE clients who have provided indication of their intention to continue to utilise the services of the SGE post sale;(b) the successful tenderer demonstrating its ability to obtain the transfer and retention of existing security certification;(c) the successful tenderer demonstrating that it is an appropriate provider of SGE services to Commonwealth agencies;(d) the operational capacity and experience of the tenderer, including their track record in providing secure Internet service or related IT services and experience in managing a similar sized business, and the human resource strategy to be adopted in the sale process (e) the price offered for the SGE;(f) the financial capability of the tenderer, including clear evidence of its ability to finance the acquisition and business requirements; and(g) the ability of the tenderer to meet the sale timetable.Government information will continue to be protected by requiring the SGE buyer to maintain the SGE operations in accordance with stringent security standards set and monitored by appropriate security agencies. There is nothing unusual in the use of suitably qualified contractors to support security standards and requirements.Agencies will continue to be responsible for their IT security.402615:05:004026Faulkner, Sen JohnSenator FAULKNER5K4NSWALP00—I move:That the Senate take note of the answers given by the Minister for Communications, Information Technology and the Arts (Senator Alston) to questions without notice asked today.We have had from Senator Alston today another absolutely abject performance. We have been getting used to it over the last few days since Senator Hill has been overseas, but what a pathetic performance by Senator Alston. He has fudged and weaved and obfuscated but he cannot avoid the fact that he cannot explain to the Senate or to the Australian people the government's policy on two crucial issues in the GST package—that is, the adverse effect on people in our community on low incomes and the erosion of pensioners' compensation. He simply does not know. That has been his form all week—a disgraceful week. Thank God it is Wednesday. At least we have only one question time to go from Senator Alston.I suspect that at the beginning of the week Senator Alston said to the powers that be in the Prime Minister's office and the Treasurer's office, `Look, I haven't got a clue about the goods and services tax. What should I do in Senate question time?' and someone said to him, `Oh well, Treasurer Costello wrote an article in the Financial Review on Monday. That'll provide all the answers that you'll need.' So Senator Alston has come into the chamber with this particular article and with what he thought would be the relevant parts highlighted and he has used quotations from that particular article all week in an attempt to answer important, simple questions directed to him in relation to this fundamental issue of public policy in this country, and he has failed.We have had a situation where Senator Alston today could not answer an important question from Senator Cook. He floundered in attempting to answer a question from Senator Murphy instead of addressing that important issue, which was the apparent forfeiting by pensioners of the next two scheduled automatic indexation adjustments of their pensions. Again, what could Senator Alston do? Nothing but resort to reading out selected highlighted parts of Treasurer Costello's article in Monday's Financial Review. Senator Murphy and Senator Cook are still waiting for answers to the questions they directed to Senator Alston today.Then, as a bit of a confidence builder for Senator Alston, what did he decide to do on the next question that was directed to him? It was about the Queensland National Party. He cannot tee off at the opposition and he has got no idea how to defend the goods and services tax. So what does he do? He tees off on the Queensland National Party. The only punch he landed in question time today was on the Queensland National Party—and he humiliated them. He absolutely humiliated the Queensland National Party. Really, I think that is what it is all about with Senator Alston. He has no idea about the key issues of public policy, but he is perfectly willing to put the slipper into those colleagues—AW5CARRSenator Carr—They are an easy mark, though.5K4Faulkner, Sen JohnSenator FAULKNER—They are an easy mark, it is true. Poor old Senator Boswell and Senator O'Chee have to cop it because the only glove Senator Alston has laid on anyone in question time in three days this week was on the Queensland National Party. What an extraordinary performance from Senator Alston.I was very cynical when Premier Kennett made those comments about Victorian cabinet ministers, but I have to say that Senator Alston has shaped up and come in here this week—he knew it was his big chance with Senator Hill away in New York. He has always wanted to be leader, and he wanted to show his colleagues how good he is and that he could really fill the shoes of Senator Hill. Let us be honest: they are not big shoes to fill, but he has failed the test. He has let Mr Howard and Mr Costello down, he has let the Liberal Party down, and all I can say after three question times—and I never thought I would—is: come back, Senator Hill.15:10:004027Patterson, Sen KaySenator PATTERSONLI4VICLP10—I hardly think the comments made by Senator Faulkner warrant my rising to counteract them.Opposition senators interjecting—10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Senator Faulkner and Senator Carr, please cease interjecting.LI4Patterson, Sen KaySenator PATTERSON—I do not want to waste time counteracting that personal attack on Senator Alston. It is quite obvious that, when somebody has not got the wit or the brains to actually put forward an argument, they have to be involved in personal attack. What the Labor Party are doing is failing to face up to the fact that they failed in government to reform the taxation system. All they did was to rely on the wholesale sales tax system, and the taxation policy that they took to the last election is now in shambles. They were going to have capital gains tax on capital gains items purchased before 1985; they got rid of that days after the election. They were going to have a tax on four-wheel drives; they got rid of that days after the election. All that is left of their tax policy is to take wholesale sales tax off orange juice and put it on caviar. That is all that is left of their policy: a shell. They have no ideas.Gary Johns, a former Keating minister, said in the Herald Sun on 25 November—and I am sure he would say it again:Labor promised then not to raise taxes and to provide income tax cuts.This is before the 1993 election. He continued: Its Budget raised wholesale sales taxes and delivered only half of the promised tax cuts.They are crying crocodile tears on the other side saying that people are not compensated when they have the gall to raise wholesale sales tax and provide not one cent of compensation. In fact, they failed to give the l-a-w tax cuts that they said they were going to give. So to stand up here today and say, like Senator Faulkner did, that Senator Alston did not have the answers is absolutely outrageous. As Peter Costello said in the Financial Review on Monday:This is the first time a government has provided real assistance to low-income earners to cover the effect of indirect tax changes.If the Labor Party were prepared to own up to that, and if they were so concerned about low income families and people on pensions, they would look to the future and say, `We need a taxation system that is sustainable into the future. We need a taxation system that relies on an expanding sector of the economy, not a contracting sector of the economy as we now have with taxes based on goods.' As services expand, we end up with a larger pool of money and the premiers—Labor premiers included—have admitted that; Labor, at the federal level, is totally out of step.Opposition senators interjecting—LI4Patterson, Sen KaySenator PATTERSON—Madam Deputy President, they all have an opportunity on the other side. Would you ask them to desist from interjecting?10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—All interjections are disorderly, Senator Murphy, and I call you to order.LI4Patterson, Sen KaySenator PATTERSON—If they were as concerned as they say they are about people on low incomes, they would be looking to the future. They would be looking to a tax system that will provide pensions into the future, that will provide health into the future, and that will provide the states with the money that is going to be needed for people with disabilities, for hospitals and for roads. But they have not got a vision. They cannot see beyond their policy bellybutton; in fact they do not have a policy to put forward. The only policy they have on tax, as I said, is to take wholesale sales tax off orange juice and put it on caviar. It is absolutely outrageous.The ALP has forgotten its former leader's support—and should we mention him, after the speeches we heard at lunchtime today? But the former Labor Prime Minister recognised the need for taxation reform; the current Leader of the Opposition cannot bring himself to support taxation reform. In particular, the former Labor Prime Minister supported a consumption tax. Paul Keating highlighted the three main advantages of a consumption tax, and I will repeat them. First, it would allow a more rational indirect tax system than the wholesale sales tax system. But what do the ALP do? They stick to the wholesale sales tax system. That is their policy. Second, it would allow greater tax revenues to be generated for the benefit of individuals' tax rate reduction, and it would generate tax from those who evade or avoid income tax. Third, it would provide a useful net dividend for distribution to the rest of the community. But they have turned away from that. They have failed to acknowledge that there is a need for taxation reform in this country and would hold Australia back. They do not care about the future of our social security system, the future of our health system, or the future of the states and their need to provide services to the community.5L6FERRISSenator Ferris—Working families.LI4Patterson, Sen KaySenator PATTERSON—That is right. Senator Ferris reminds us that this tax package is for working families. It is the first time, as I said, that a government has provided real assistance to low income earners to cover the effect of indirect tax. It is about time Labor got into step with their state colleagues.15:15:004028Ray, Sen RobertSenator ROBERT RAYUI4VICALP00—We have reflected, I suppose, a little adversely on the performance of Senator Alston this week. Maybe we have not been fair to him, because what we have to do historically is look back at the people who have held the position of leading the coalition in this chamber. I can go back 18 years. We go back and look at Sir John Carrick, a very tough character, a very bright character and also, I have to say, which is rare for me, a very decent character. He led the Liberal Party here for many years. He was succeeded by Senator Chaney, who had all those avuncular and urbane skills that we came to at least respect, if not love. Finally we had Senator Hill, who often I think tries to answer questions. Senator Hill, for all the faults that he might have, especially at estimates committees and at question time, does actually try to understand and grasp what the question is and actually respond to the question, with the odd diversion and the odd bit of abuse.But what do we have with Senator Alston? He approaches it in an entirely different manner. His view of question time is that he is here for an hour being kept out of his office and his job is just to totally avoid answering a question. The first technique he adopts is what I would call the `village idiot' approach. He pretends he does not understand the question and he just gives an entirely different answer.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—I hope you are not reflecting upon the senator.UI4Ray, Sen RobertSenator ROBERT RAY—I said `approach'. I certainly did not refer to him in those terms and never would. I said that this is his technique of answering questions. The second approach is: if you can find a brief, just read it out. He needs about two staff members to bring all his briefs down these days, because over the years he has become rather notorious for never reading them before he comes in. So his normal technique is to sit where he is now and have the staff hand over a page, which he parrots out.With Senator Alston having been promoted to leading this week, we have now got what we call the nine-foot syndrome. He cannot actually be given a brief, so he has actually got to find them for himself. This is a very difficult task for an indolent minister if you have never looked at the pack before in your life. That is the situation we have been in. Hence he plucked figures out of the air yesterday about 81 per cent being better off and no-one being worse off, implying that 19 per cent of people are in a dead-set neutral position. The mathematical possibility of that is 10 with many hundreds and thousands of noughts added to it in terms of odds if you actually ever tried to create that. So that is the situation we are in. A bit of abuse around the chamber is standard operating procedure for Senator Alston when he is trying to bluff his way out of a difficult question, pull a few figures out of the air, quote from Peter Costello's article and pick up your pay cheque at the end of the week.This sort of intellectual torpor is absolute humiliation to the Liberal Party of Australia. That is what it is—an absolute humiliation for the Liberal Party. You can see his own supporters cringing at this lack of ability to represent them out front. But what you cannot see on their faces yet, I have to concede, is who is planning to replace him one day. I am sure they are there but, even with my experience in these things, I cannot quite read it.But if ever you want to see something worth criticising it is Senator Alston's absolute cynicism in answering the question on Mrs De-Anne Kelly. If you actually disaggregate the answer, what do you find? Basically what he is saying is that Mrs Kelly holds those views because she is in a rural electorate and that is okay. What Senator Alston is basically saying is that it is okay for the coalition to be two-faced; it is okay for Mrs De-Anne Kelly to go up and campaign in the electorate of Dawson on non-coalition policy in order for her to win a seat. That is what he is arguing, that it is okay to work both sides of the street. He often goes on and talks about the plurality in the Liberal Party, yet what do we get the moment someone in the coalition disagrees? Let me quote Mr Ian Macfarlane, the member for Groom. Describing Mrs Kelly, he said:She operates in a treacherous manner. She operates without respect for teamwork required to operate a successful coalition.So in this modern-day Liberal-National Party, if you disagree, you are accused of being treacherous. Finally, when Senator Alston finds a newspaper reporter, Mr Seccombe, with whom he disagrees, he does not just say, `I disagree with the article,' but dismisses it as trivia and then questions why the Sydney Morning Herald employs that person. What a disgrace. (Time expired)15:20:004029Ferris, Sen JeannieSenator FERRIS5L6SALP10—One of the less pleasant aspects of this place is when people sit very comfortably in glass houses throwing stones, indulging in the politics of division and derision.UI4RAYSenator Robert Ray—Like working for Senator Minchin when you were running for the Senate. Twenty gorillas that cost you; $20,000.5L6Ferris, Sen JeannieSenator FERRIS—Senator Ray, long may you sit there in your glass house. I hope you are relaxed and comfortable there, because we plan to leave you there for quite some time yet.I would like today to talk about tax reform, because that was the issue that we were originally going to address in our taking note debate today. There has been a lot of discussion over the last day or so, in the dozens of hours that are going to be set aside in the debate for tax reform, about the need for tax reform, and in particular the cries from small business and families in this country who desperately want tax reform. In the quotations that have been read into the Hansard already there has been a good deal of evidence about how unfair the tax system would be under reform, how appalling it would be, how divisive it would be for families. But I would like to tell the chamber today about some evidence that we received from the peak body of independent grocers in this country, the people who run the corner stores. They pleaded with the committee that I sat on for tax reform. They said, `We are so badly hurt by the current sales tax regime that we are prepared to look at the GST and give it broad acceptance.'5K4FAULKNER Senator Faulkner—I have a point of order, Madam Deputy President. You would be aware that the motion before the chair is to take note of the appallingly hopeless and inadequate answers given by Senator Alston in question time today. I ask you to direct Senator Ferris to address the question. Why doesn't she come out, instead of doing this, and defend Senator Alston? That is what she is expected to do.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Senator Faulkner, there is no point of order. This is a wide ranging debate. Those on my left have been as far off the point as you seem to think some others have been. Senator Ferris, please continue.5L6Ferris, Sen JeannieSenator FERRIS—Thank you, Madam Deputy President. Another stone from a glass house—and, equally comfortably, you will stay there for as long as it suits your people to leave you there. The evidence that we had—10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Excuse me, Senator Ferris. Would you like to rephrase that last comment of yours? I am not sure whether you were addressing the chair or whether you were addressing Senator Faulkner. I hope you were addressing Senator Faulkner. Would you please address the chair.5L6Ferris, Sen JeannieSenator FERRIS—I was, and I am sorry. I will withdraw the comment and address the chair, Madam Deputy President. I would like to say that the evidence that came from NARGA, the national association of independent grocers, was very much the norm for evidence we received from small businesses all around the country. They talked about the difficulties that they faced under the current sales tax regime and the great need for tax reform to unravel the appalling red tape which now grips those small businesses as they try to understand the tax reform system.However, as much as possible, the evidence that came from unions who were rounded up to give evidence to our committee not surprisingly took a quite contrary view. In fact, the evidence from the Australian Education Union in Tasmania was particularly revealing. When I asked the witness whether they were aware that the 5,000 members of that union would have substantial tax cuts under tax reform, they said no. When I asked whether they were taking that into account in opposing tax reform, they said no. In fact, Ms Hull said:We are taking that into account . . . PAYE tax people at present are already bearing a substantial brunt in relation to their tax contribution.We agree, and that is why we are trying to change the taxation system to make it fairer for families and fairer for small business. That is why we want to legislate to give tax cuts to families.It is quite interesting to hear members of the opposition criticising the government's attempt to change the taxation system when in fact, after the 1993 election, the opposition when in government implemented its most disgraceful taxation changes of all. After promising no GST and after having been elected on that platform, in the 1993 budget Labor increased the rates of wholesale sales tax across the board. In wholesale sales tax revenue in 1992-93, they raised $9.2 billion. But, by the time they left office, they were collecting $12,955 million—an increase of more than 40 per cent on their previous taxation revenue.Where was the compensation then for low income families? Where were the Senate committees then, with their trade union submissions? Most importantly, where were the Democrats? Australians want tax cuts and they want tax reform. They want to be taxed when they spend and not just when they earn, and they want the Senate to pass legislation that will enable that. (Time expired)15:26:004031Murphy, Sen ShayneSenator MURPHYFX5TASALP00—I would say to you, Madam Deputy President, that another thing that Australians, particularly those who are pensioners and benefit recipients, want is to make sure that they are fairly treated. That is the point I want to address today in taking note of the responses to questions to Senator Alston—in particular, to the question I asked him. We have not got any answers. That is clear now, after Monday when he could not respond to Senator Cook but referred to the article by Treasurer Costello in the Financial Review and said, `There are all of the answers.' I have to say to the minister that, if they are the answers, the Treasurer says in response to a question he poses himself:So let's get the facts straight about what the Government is proposing.The Government will be increasing pensions and other social security payments by 4 per cent from the day the GST commences. Pensioners will not have to wait for indexation adjustments to follow prices—for the first time, they will get increases before any price rise.He further says:This is not so. It is at least 4 per cent and no discounting. I asked a question of the minister today with regard to the clawback provisions of the amendments to the Social Security Act—that is, 2½ per cent of the four per cent that you give them up front is taken back.We then go to the government's position that is outlined in the ANTS document on page 56. It says this quite clearly about increasing pensions and benefits:. a 4.0 per cent increase in the maximum rate of all income support payments provided to social security and veterans' pensioners, other social security recipients and students in receipt of Commonwealth income support, including additional payments and allowances such as Child Disability Allowance and Mobility Allowance;. a 2.5 per cent increase in the income test free areas . . . He says further down:This represents an estimated real increase of $5.80 per fortnight in the maximum single rate pension and $4.80 per fortnight for each of a married couple in July 2000.But the fact is that that is not the case and will not be the case. The government itself has set down in this document and in all of its statements that there will be a real price increase of 1.9 per cent.But we know that the Treasury has acknowledged that it could be at least as high as 3.3 per cent, and others have claimed that the price increases could be as high as six per cent. What you have said to the pensioners of this country is, `We will give you four per cent, plus we will ensure that we maintain payments at 1.5 per cent higher than CPI.' We all know that that is simply not going to be the case—that has even been acknowledged by Treasury officials.It can be seen from the committee reports, in particular the one that I would have thought would have dealt with the issue of support payments, the Senator Community Affairs References Committee, that the Labor senators on that committee actually did deal with the issue of pension increases. But what do we get when we go to the government senators' dissenting report titled `We have been told that'? The pensioners have been told they will get four per cent, but what you have not told them anywhere in any documentation, in any statement by the Treasurer to which Minister Alston refers, is that you are going to take 2½ per cent of it back. You are not going to allow any further indexation increases until 2½ per cent of the four per cent you say they get is reached—and it would appear that they get that up-front and forever. You have never told them that they lose 2½ per cent of it and they end up with 1½ per cent, which is less than the CPI increase that you have acknowledged yourself. So it is no wonder that the people, particularly the pensioners, of this country are so concerned about what this government is proposing. Not only does Senator Alston not know this but it is also the case for most of his colleagues—they also do not know this. That is why the minister went back to the box to seek advice from his advisers on the question I put to him today, which is a clear example of the person we now have as Acting Leader of the Government having no capacity to answer any questions at all.15:31:004032Coonan, Sen HelenSenator COONAN2M6NSWLP10—It is one thing to take note about answers given about low incomes and erosion of pensions, if indeed that can be proven. It is quite another thing to make a gratuitous and unwarranted attack on a minister that we have seen this afternoon from three Labor senators, in particular Senator Ray, who I would have thought has been here long enough to know that that sort of gratuitous attack achieves absolutely nothing and certainly does not distinguish him in any way whatsoever. Why on earth would anyone believe that the public actually want to hear that kind of attack? What does it prove? It is not constructive, it does not achieve anything and, what is more, it distracts from a perfectly legitimate debate about the GST and about the tax package and about matters that are of vital concern to Australians—Australians who want to know about the government's tax package and do not want to hear this sort of nonsense that has gone here this afternoon in the debate on the motion to take note of answers.FX5MURPHYSenator Murphy—What about the four per cent? 2M6Coonan, Sen HelenSenator COONAN—I am glad you have raised that, Senator Murphy, because you really do not get to the point very adequately when you talk about the fact that there is no compensation. One of the editorials—I think yesterday—said that this debate is in danger of being nitpicked to death.5K4FAULKNER Senator Faulkner—Why don't you defend him?2M6Coonan, Sen HelenSenator COONAN—It is in danger of being nitpicked to death, because nobody concentrates on the package. In your obsessional focus on trying to find somebody who might not be as well off under this package, you forget what the package does.5K4FAULKNER Senator Faulkner—Are you going to defend Alston?10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Senator Faulkner and Senator Murphy, could I please have some restraint and some silence, thank you.2M6Coonan, Sen HelenSenator COONAN—Thank you, Madam Deputy President. I know you senators on the other side do not like this but the point is that it was the coalition—5K4FAULKNER Senator Faulkner—We want you to defend your leader.2M6Coonan, Sen HelenSenator COONAN—who has had the courage to identify the inherent unfairness in the current tax system and the courage to propose a tax system that for the first time in history quite properly addresses the impact of the reforms on low and middle income Australians.FX5MURPHYSenator Murphy—Tell us about the four per cent.2M6Coonan, Sen HelenSenator COONAN—This was not always the case. When the income tax act was introduced in 1914, not everyone was better off. When the capital gains tax was introduced in 1985, the whole object was to make some people worse off. And when the fringe benefits tax was introduced in 1985, the whole object was to make some people worse off. When Labor increased all of the wholesale sales tax rates in 1993, the object was to make people worse off. And when you increased petrol excise it made people worse off. We in fact have a tax plan which has gone to lengths that no other government has gone to. No-one else has addressed the extent to which compensation is necessary.FX5MURPHYSenator Murphy—Tell us about the four per cent.5K4FAULKNER Senator Faulkner—You're not going to defend Alston at all, are you?2M6Coonan, Sen HelenSenator COONAN—Senator Faulkner, you seem to be terribly confused as to whether or not you want me to talk about Senator Alston. I am happy to do that. He is such an excellent minister. He does such a wonderful job and he answers questions with such particularity. Or do you want me to talk about the tax package? You do not really seem to know what you want me to do.Senator Faulkner interjecting—10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Order! Senator Faulkner, I will have some order, thank you. Senator Coonan, will you please address the chair and ignore the interjections. That might make life a bit easier for us all.2M6Coonan, Sen HelenSenator COONAN—Thank you, Madam Deputy President. I shall certainly try to do that. What is obvious if you really look at this package seriously is that most low income people, most of the people at the lower socioeconomic end of our economy, will be considerably better off with this package. In fact, it is worth recounting that with $13 billion worth of personal income tax cuts, $2 billion in enhanced family benefits and a doubling of the tax-free threshold for the family tax initiative people are going to be very much better off.There is a very good deal for pensioners—quite contrary to what has been put here this afternoon. In fact, the Treasurer has very adequately pointed out that after the pension and other social security, indexation will be paid, so benefits will be 1.5 per cent higher than the full consumer price index—with no discounting. That is about as clear as you can make it. No matter how you want to twist it, no matter how you want to try to say it means something else, it does not. In addition, the government is easing the pensions means test, providing lump sum savings benefits for all pensioners. (Time expired)Question resolved in the affirmative.403310001CLERK ASSISTANTThe Clerk—A petition has been lodged for presentation as follows:4033105DT6Bartlett Sen AndrewTo the Honourable President and Members of the Senate in the Parliament assembled.The Petition of the undersigned call on the Federal Parliament to ensure that the current regulations relating to food content are retained by the Australian New Zealand Food Authority and that adequate food labelling is introduced which allows the Australian community to make a real choice when it comes to the purchase and consumption of food.Your Petitioners ask that the Senate support legislation which will ensure that all processed food products sold in Australia be fully labelled. This labelling must include: all additives percentage of ingredients nutritional information country of origin food derived from genetically engineered organismsSenator BartlettDT6Senator Bartlett(from 105 citizens)Petition received.Notices403340334033Ellison, Sen ChrisSenator ELLISON9X5WALPSpecial Minister of State10—I give noitice that, on the next day of sitting, I shall move:That the provisions of paragraphs (5) to (7) of standing order 111 not apply to the Export Market Development Grants Legislation Amendment Bill 1999, allowing it to be considered during this period of sittings.9X5Ellison, Sen ChrisSenator ELLISON—I table my statement of reasons. I seek leave to have that statement incorporated in Hansard .Leave granted.The statement read as follows—STATEMENT OF REASONS FOR THE SENATEExport Market Development Grants Legislation Amendment Bill 1999The Purpose of this Bill is to extend the Export Market Development Grants (EMDG) Scheme for a further two years to grant year 2000/2001, effect amendments to establish the original intention of a number of provisions of the Export Market Development Grants Act 1997, and provide for better administration of the grants scheme.UrgencyThe EMDG Scheme currently expires at the end of the 1998/1999 Grant Year (i.e. on 30 June 1999). The EMDG Legislation Amendment Bill 1999 must be passed by 30 June 1999 to ensure continuation of the EMDG Scheme beyond that date.Circulated with the Authority of the Deputy Prime Minister and Minister for Trade.Senator Calvert, at the request of Senator Eggleston, to move, on the next day of sitting:That the time for the presentation of the report of the Environment, Communications, Information Technology and the Arts Legislation Committee on its inquiry into the provisions of the Radiocommunications Legislation Amendment Bill 1999 and 2 related bills be extended to 11 May 1999.Senator Murphy to move, on the next day of sitting:That the Economics References Committee be authorised to hold a public meeting during the sitting of the Senate on 22 April 1999 from 5 pm, to take evidence for the committee's inquiry into whether a new reactor should be built to replace the High Flux Australian Reactor at Lucas Heights.Senator O'Brien, at the request of Senator Mackay, to move, on the next day of sitting:That the Senate notes the failure of Government ministers and their departments to adequately respond to parliamentary questions and requests for information on government programs and administration.Senator Calvert, at the request of Senator Ferguson, to move, on the next day of sitting:That the Economics Legislation Committee be authorised to hold a public meeting during the sitting of the Senate on 23 April 1999 from 10 am to 12 noon, to take evidence for the committee's inquiry into the provisions of the Taxation Laws Amendment Bill (No. 4) 1998.Committees40344034403415:40:004034Calvert, Sen PaulSenator CALVERT5F4TASLP10—I present the sixth report of the Selection of Bills Committee.Ordered that the report be adopted.5F4Calvert, Sen PaulSenator CALVERT—I seek leave to have the report incorporated in Hansard .Leave granted.The report read as follows—SELECTION OF BILLS COMMITTEEREPORT NO. 6 OF 19991. The Committee met on 20 April 1999.2. The Committee resolved to recommend—(a) That the following bills be referred to committees:Bill titleStage at which referredLegislation committeeReporting dateAustralia New Zealand Food Authority Amendment Bill 1999 (see appendix 1 for a statement of reasons for referral)immediatelyCommunity Affairs30 June 1999Norfolk Island Amendment Bill 1999 (see appendix 2 for a statement of reasons for referral)immediatelyLegal and Constitutional12 August 1999(b) That the provisions of the following bills be referred to committees:Bill titleStage at which referredLegislation committeeReporting dateAboriginal Land Rights (Northern Territory) Amendment Bill (No. 2) 1999 (see appendix 3 for a statement of reasons for referral)immediatelyFinance and Public Administration12 August 1999Wool International Privatisation Bill 1999 (see appendices 4 and 5 for a statement of reasons for referral)immediatelyRural and Regional Affairs and Transport24 May 1999(c) That the following bills not be referred to committees:. Defence Legislation Amendment Bill (No. 1) 1999. Public Employment (Consequential and Transitional) Amendment Bill 1999. Public Service Bill 1999. Statute Stocktake Bill 1999. Taxation Laws Amendment (Political Donations) Bill 1999.The Committee recommends accordingly.3. The Committee deferred consideration of the following bills to the next meeting:(deferred from meeting of 23 March 1999). Taxation Laws Amendment Bill (No. 4) 1999. Taxation Laws Amendment Bill (No. 5) 1999. Taxation Laws Amendment (Demutualisation of Non-insurance Mutual Entities) Bill 1999(deferred from meeting of 30 March 1999). Customs Amendment Bill (No. 2) 1999. Import Processing Charges Amendment Bill 1999(deferred from meeting of 20 April 1999). A New Tax System (Family Assistance) Bill 1999. A New Tax System (Family Assistance) (Consequential and Related Measures) Bill (No. 1) 1999. Commonwealth Grants Commission Amendment Bill 1999. Customs Amendment Bill (No. 1) 1999. Customs Amendment (Temporary Importation) Bill 1999. Employment, Education and Training Amendment Bill 1999. Environment and Heritage Legislation Amendment Bill 1999. Migration Legislation Amendment Bill (No. 2) 1999 . Superannuation Legislation Amendment Bill (No. 3) 1999. Taxation Laws Amendment Bill (No. 6) 1999. Tradesmen's Rights Regulation Repeal Bill 1999.(Paul Calvert)Chair21 April 1999Appendix 1Proposal to refer a bill to a committeeName of bill : Australia New Zealand Food Authority Amendment Bill 1999Reasons for referral/principal issues for consideration:1. To assess the proposed amendments in relation to:The adequacy of the proposed Objectives for ANZFAThe extent to which public health is actually protected and promotedThe extent to which consumer protection may be reducedTransparency and public reporting of decision makingAdequacy of public participation in ANZFA decision-making2. To examine the relationship of this legislation to the overall Government program for changes to food standards and regulation including:Administrative and resource changes within ANZFAThe transfer of responsibility for ANZFA out of the health portfolioThe implementation of national competition policyThe recommendations of Dr Blair in the Report of the Food Regulation ReviewANZFA's relationship with state-based regulation and enforcementRelationship with international standards. Possible submissions or evidence from:Louise Sylvan—CEO—Australian Consumers AssociationMara Bun—Manager Policy and Public Affairs—Australian Consumers AssociationMatt O'Neill—Senior Policy Officer—Food and Nutrition—Australian Consumers Association (ACA)Dick Copeman—Director—Consumer Food NetworkScott Kinnear—Chairperson—Organic Federation of AustraliaKate Moore—Exec Dir—Consumers' Health ForumBob Phelps—Director—GeneEthics NetworkDr Stuart Spencer—CEO—Confectionery Manufacturers of AustraliaAlan Williams—MD—Coles SupermarketsGordon Gregory—Exec Dir—National Rural Health AllianceGay Pincus—former Chair of National Food AuthorityMartin Dwyer—Director—Biomedical Engineering, The Canberra HospitalRichard Gray—Director, Aged Care Services—Australian Catholic Health Care Association (ACHCA)Dr David Brand—President—AMASandra Capra—President—Dietitian's Association AustraliaFran Baum—Public Health AssociationRobyn Charlwood—Heart Foundation—State Director (Vic)Prof Kerin O'Dea—Professor of Nutrition and Preventive Medicine MMC; Head of Centre for Population Health and Nutrition at the Institute of Public Health and Health Services Research; Deputy Chair Research Committee NHMRCRob Moodie—Vic HealthAssoc Professor David Briggs—Deakin UniversityRosemary Stanton OA—NutritionistJohn Ward—Food Analyst—Dunn, Son and StoneDesmond Sibra—Solicitor and Food ConsultantGill Hassen—General Manager—Australian Natural FoodsMax Ogden—ACTUAss Prof Simon Chapman—Dept Public Health & Communications Medicine, Sydney UniMike Jablonski—Merchandising Director—Davids Limited Professor Ben Selinger—Emeritus Professor Chemistry—ANUDr John Coveney—Senior Lecturer, Dept of Public Health, Flinders Medical CentreSally Nathan—Assoc Lecturer—Faculty of Medical Education—UNSWDr Heather Yeatman—Senior Lecturer—School of Nutrition—University of WollongongDavid Mercer—Science & Technology Studies—University of WollongongAddresses and contact details for these people are available.Committee to which bill is to be referred:Community Affairs (Legislation)Possible hearing date(s): May or June 1999Possible reporting date: 30th June 1999(signed) Kerry O'BrienWhip/Selection of Bills Committee memberAppendix 2Proposal to refer a bill to a committeeName of bill: Norfolk Island Amendment Bill 1999Reasons for referral/principal issues for consideration:Contentious issues being all three proposed amendments contained in the bill.Possible submissions or evidence from:The Norfolk Island Legislative Assembly and Residents of Norfolk Island.Committee to which bill is to be referred:Senate Legal and Constitutional Legislation CommitteePossible hearing date(s): 15 June 1999Possible reporting date: 12 August 1999(signed) Kerry O'BrienWhip/Selection of Bills Committee memberAppendix 3Proposal to refer a bill to a committeeName of bill: Aboriginal Land Rights (N.T.) Amendment Bill No. 2 1999Reasons for referral/principal issues for consideration:To consult with land councils and expose hypocrisy of Northern Territory GovernmentPossible submissions or evidence from:Northern Land Council Central Land CouncilCommittee to which bill is to be referred:Finance and Public Administration Legislation Committee.Possible hearing date(s):Possible reporting date: Post July 1999(signed) Kerry O'BrienWhip/Selection of Bills Committee memberAppendix 4Proposal to refer a bill to a committeeName of bill: Wool International Privatisation Legislation 1999Reasons for referral/principal issues for consideration:To examine the impact of the change of Wool International into a commercial company and the need for more input from the equity holders and growers into the plans for the new company. The need to consider the role of the Interim Advisory Board of Wool International in the privatisation process; the issue of appointments to the new board; control of the 40% bloc of votes not immediately transferable; and employment of the current Wool International staff. Offers to purchase the whole wool stockpile also need to be considered.Possible submission or evidence from:Peter Laird, Chairman, Australian Wool Growers Association orDavid Webster, Deputy Chairman, Australian Wool Growers AssociationDavid Sasson, Australian Wool GroupDr Keith Campbell, WoolChainDonald McGauchie, Chair, Interim Advisory Board of Wool InternationalCommittee to which bill is to be referred:Rural and Regional Affairs and Transport Legislation CommitteePossible hearing date(s):Possible reporting date: As soon as practicable.(signed) Vicki BourneWhip/Selection of Bills Committee memberAppendix 5Proposal to refer a bill to a committeeName of bill: Wool International Privatisation Bill 1999 Reasons for referral/principal issues for consideration:Industry has expressed some concern about Govt consultation with it prior to the introduction of the legislation into the parliament. Referral will provide the industry with an opportunity to comment on aspects of the legislation in particular the proposed structure of the new entity, grower representation on the Board and its answers plan and the disposal of the stockpile.Possible submissions or evidence from:Wool Council of Australia, Farmer Organisations, processing sectorCommittee to which bill is to be referred:Rural and Regional Affairs and Transport Legislation CommitteePossible hearing date(s): 3, 7 May, 10, 14 MayPossible reporting date:(signed) Kerry O'BrienWhip/Selection of Bills Committee memberNotices40374037Motion (by Senator Woodley) agreed to:That general business notice of motion no. 187 standing in the names of Senators Woodley and Crossin for today, relating to the Northern Territory's mandatory sentencing laws, be postponed till 27 April 1999.Motion (by Senators Margetts) agreed to:That business of the Senate notice of motion no. 3 standing in the names of Senators Margetts and Allison for today, relating to the disallowance of the Disability Discrimination Amendment Regulations 1999 (No. 1) contained in Statutory Rules 1999 No. 40, be postponed till 27 April 1999.Motion (by Senator Bourne, at the request of Senator Allison) agreed to:That business of the Senate notice of motion no. 1 (relating to the reference of matters to the Environment, Communications, Information Technology and the Arts References Committee) and general business notice of motion no. 136 (the appointment of a Select Committee on Superannuation and Financial Services) standing in the name of Senator Allison for today, be postponed till the next day of sitting.Motion (by Senator Brown) agreed to:That general business notice of motion no. 150 standing in his name for today, proposing an order for the production of a document by the Minister representing the Minister for Defence (Senator Newman), be postponed till the next day of sitting. Motion (by Senator Brown) agreed to:That general business notice of motion no. 191 standing in his name for today, relating to nuclear waste, be postponed till the next day of sitting.Motion (by Senator O'Brien, at the request of Senator Bolkus) agreed to:That business of the Senate notice of motion no. 2 standing in the name of Senator Bolkus for today, relating to the reference of matters to the Legal and Constitutional References Committee, be postponed till 27 April 1999.Business40384038Motion (by Senator Ellison, at the request of Senator Tambling) agreed to:That the provisions of paragraphs (5) to (7) of standing order 111 not apply to the Further 1998 Budget Measures Legislation Amendment (Social Security) Bill 1999, allowing it to be considered during this period of sittings.Miscellaneous4038Motion (by Senator O'Brien, at the request of Senator Sherry) not agreed to:That the Senate—(a) notes: (i) that the Prime Minister (Mr Howard) misled the Australian people when he said in his so-called tax reform broadcast on 12 April 1999 that Australia had the second highest income taxes and that only Denmark's are higher, (ii) that the Organisation for Economic Co-operation and Development (OECD) study he quoted shows that not just Denmark, but also Belgium, Sweden and Finland have higher income taxes than Australia and that Turkey has the same level, (iii) the further misleading comments of the Prime Minister, in the same broadcast on 12 April 1999, when he said, `In fact, 23 per cent of the average Australian worker's wage is consumed by income tax compared with 18 per cent in America, 17 per cent in Britain and only 10 per cent in France', and (iv) the same OECD study which lists all income taxes, including those called social security contributions, shows that out of 29 industrialised countries Australia ranks as the twelfth lowest, not the second highest, as the Prime Minister claimed; and (b) condemns the Prime Minister for yet another misleading claim in an attempt to justify the unfair goods and services tax.Committees403840384038Motion (by Senator Calvert, at the request of Senator Chapman) agreed to:That the time for the presentation of the report of the Parliamentary Joint Committee on Corporations and Securities on the provisions of the Corporate Law Economic Reform Program Bill 1998 be extended to 29 April 1999.40384038Motion (by Senator Bourne, at the request of Senator Allison) agreed to:That the time for the presentation of the report of the Environment, Communications, Information Technology and the Arts References Committee on its inquiry into the powers of the Commonwealth in environmental protection and ecologically-sustainable development in Australia be extended to 27 May 1999.Miscellaneous4038Motion (by Senator Margetts and Senator Brown)—as amended by leave—put:That the Senate—(a) notes: (i) the motion in relation to the Government's Wine Equalisation Tax (WET) proposal that was moved in the Tasmanian House of Assembly, on 14 April 1999, by Ms Peg Putt of the Australian Greens and passed unanimously by all political parties, and (ii) the proposed motion in relation to the Government's WET proposal to be placed on notice on 20 April 1999 in the Western Australian Legislative Council by Dr Christine Sharp of the Greens (WA) which mirrors the Tasmanian motion;(b) recognises that small wineries are a vital part of the regional small business sector, providing employment and local cash flow, bringing in tourism dollars and export dollars and contributing to a positive image of Australia both locally and overseas; and (c) is deeply concerned that the Federal Government's tax reform package containing an ad valorem tax on wine may destroy small wineries and impact adversely on public health.15:50:00The Senate divided. (The President—Senator the Hon. Margaret Reid)27Bishop, T. M. Bolkus, N.Brown, B. Campbell, G.Carr, K. Conroy, S.Cook, P. F. S. Cooney, B.Crossin, P. M. Crowley, R. A.Denman, K. J. Evans, C. V.Faulkner, J. P. Forshaw, M. G.Gibbs, B. Harradine, B.Hogg, J. Lundy, K.Mackay, S. Margetts, D.Murphy, S. M. O'Brien, K. W. K. *Quirke, J. A. Ray, R. F.Reynolds, M. Sherry, N.West, S. M.34Abetz, E. Alston, R. K. R.Boswell, R. L. D. Brownhill, D. G. C.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.Heffernan, W. Herron, J.Kemp, R. Knowles, S. C.Lightfoot, P. R. Macdonald, S.MacGibbon, D. J. McGauran, J. J. J.Minchin, N. H. O'Chee, W. G.Parer, W. R. Patterson, K. C. L.Payne, M. A.Reid, M. E.Synon, K. M. Tambling, G. E. J.Tierney, J. Troeth, J.Vanstone, A. E. Watson, J. O. W.Collins, J. M. A. Macdonald, I.Hutchins, S. Hill, R. M.McKiernan, J. P. Chapman, H. G. P.Schacht, C. C. Newman, J. M.* denotes tellerQuestion so resolved in the negative.Miscellaneous4039Motion (by Senator Brown) agreed to:That the Senate congratulates Yvonne Margarula and Jacqui Katona for winning a 1999 Goldman Environment Prize, as leader and spokesperson for the Mirrar people, for their campaign to stop the Jabiluka uranium mine.Matters of Public Importance4039403910000PRESIDENTThe PRESIDENT—I have received a letter from Senator Brown proposing that a definite matter of public importance be submitted to the Senate for discussion, namely:The attempt by the National Association of Forest Industries to censor free speech by threatening legal action against the authors and backers of Forest Friendly Building Timbers , a guide to using plantation-grown or recycled timbers instead of native forest timbers in building, renovation and design.I call upon those senators who approve of the proposed discussion to rise in their places.More than the number of senators required by the standing orders having risen in their places—10000PRESIDENTThe PRESIDENT—I understand that informal arrangements have been made to allocate specific times to each of the speakers in today's debate. With the concurrence of the Senate, I shall ask the clerks to set the clock accordingly.15:55:004039Brown, Sen BobSenator BROWNQD4TASAG00—This is indeed a matter of public importance. It is far wider than the booklet which is the subject of this motion, because it strikes right at the heart of consumer rights in Australia at a time when, right round the world, consumers of all sorts of products are wanting to know more about the nature of those products and in particular about such things as their social and environmental acceptability. Indeed, President Kennedy in the United States spoke very strongly during his presidency, way back in the early 1960s, of the consumer's right to know, and this was one of the first matters taken up by the United Nations in debating the right of consumers to be informed.Ralph Nader, the great consumer advocate from the United States, stated when in this country that information is the currency of democracy. So what has happened to that currency in this case? Alan Gray and Anne Hall, who are associated with the small Earth Garden magazine—which informs consumers right around Australia and other people about organic gardening and environmentally friendly ways to spend money and to develop your house and your farm and so on—got together and produced a labour of love, this little booklet, which I have given to all senators, called Forest-Friendly Building Timbers. It is a very simple guide for those people who wish to be able to use wood but not at the expense of the wild forests and the wildlife which are part of Australia's heritage. On the back of the book it says:Australia's native forests can't go on providing our building timbers without the threat of massive extinctions. The good news is that there are simple, attractive, ecologically-sound timber alternatives to native forests. This book shows you how and where to buy plantation-grown timber products, or superb recycled timbers, and how to feel good about your renovation, new home, or timber project.You don't need to make your home a museum of rare timbers.Australian companies have the products and the knowledge to make your home forest-friendly.This book has said to the consumer, `Reject timber coming out of our wild forests,' in East Gippsland, in New South Wales, in the great forests of south-west Western Australia and in the world heritage value forests which are unprotected and the rainforests of Tasmania.Most Australians would want to have this if they were buying timbers, because all the opinion polls show that most Australians are strongly opposed to the logging industry as it eats into these native forests and destroys the habitat of many endangered species and, indeed, many components of the wildlife that Australians know and love. I need go no further than to say that time and again in the Regional Forest Agreement assessments of the wellbeing of many important species logging was cited as the threat which put such species as the world's largest freshwater crayfish, Astacopsis gouldi, from Tasmania on the endangered list because it is helping drive that species towards extinction, both through the destruction of the food source habitat and through the logging roads reaching into previously safe havens for this magnificent creature.So there it is—a booklet to allow people who do not want to be part of that process but who want to use timber to get it from the alternative, which is the plantation resource industry in Australia. By the way, that industry employs more people than the native forest logging industry in this country. As the jobs fall off in the native forest logging industry, although they are cutting down more wild forests, the plantation industry is the downstream processor which is the job creator of the future in this country.NAFI, the National Association of Forest Industries, representing the big woodchip corporations, moved in. It threatened legal action; it threatened an injunction. It said that if the book was not taken off the shelves, including the shelves of BBC Hardware—a giant retail outlet in Australia which has taken this book to its heart and has taken out three pages of advertisements in the booklet as its endorsement of the thrust of it—it would take legal action. In the event, NAFI has done nothing of the sort. But what we have is a controversy, not about the book itself in the main but about the right of Australians to be freely informed. What we have from the loggers' representatives, including a reprehensible attack on this book by the now moving on NAFI head, Dr Robert Bain, is an effort to stop the information in this booklet going to consumers because the loggers want a woodchip forest; they want to make money out of our wild forests. They are leaning on—by inference if not by as yet undiscovered direct measures—BBC Hardware and potential other outlets, including the Wilderness Society, whose shops around this country still stock this book where, due to their courage, it is selling like hot cakes.What the National Association of Forest Industries and Robert Bain in his reprehensible campaign tried to do was say, `This book lies.' He has withdrawn that statement. He said it earlier, but he does not say it any more. I suggest he does not say it because he knows himself that he will be under threat of legal action if he continues that. So he goes on to say that it is misleading and such and such. But when you get down to the points he is making, there is nothing in this book which he says is wrong which he can defend in his argument. It is a matter of opinion being debated here, not a matter of fact, as he says. He has a right to hold the opinions he has. Nobody has taken legal action against that. But the opinion of the authors of this book, and the right of consumers to take that opinion, is under legal attack and threat from the might, wealth and muscle, through threat and coercion, of the logging industry against the interests of the average Australian.This is not the first time. This is the logging industry that set up the Forest Protection Society and poured millions of dollars into a front group, with the pretence that communities had got together to defend the right to destroy forests around this country. This is the industry which has threatened my colleague Peg Putt in Tasmania with legal action because she made a public statement that it did not like in defence of forests. This is the industry that had a spokesperson who told me that everything I say is put before a bank of QCs—a threat from North, the biggest woodchipper in the Southern Hemisphere, to try to make me frightened to take part in campaigning. This is the industry that time and again threatens legal action, slaps on writs, and essentially tries to bludgeon its environmentally driven and environmentally responsible opponents into silence.It will not work. I believe this action has blown up in the face of NAFI. I do not know whether that is why Robert Bain is moving on to the AMA, but I can say this: the Australian Medical Association should beware. If Robert Bain orchestrates through lawyers an effort to legally, and I believe fraudulently, try to silence opinion opposed to his in the woodchip industry, what are we going to see coming from the AMA under his direction? An effort to ban books on home birth, on euthanasia, on alternative health measures or on acupuncture because the AMA might not like alternative health measures?This is an important matter. I know that future speakers are going to get up and say that this book does not meet their thinking. My challenge to the other speakers in this chamber who take a different point of view and to NAFI is this: where is your book? The right action to take if you do not like this book is to bring out your own. It is not to try, through false, coercive and totally unwarranted legal bludgeoning, to deprive Australians of their right to know and to have a valid opinion.16:05:004041Abetz, Sen EricSenator ABETZN26TasLP10—Free speech is a treasured part of our freedom as a society. So when there is a matter about freedom of speech, I take some great interest. As with any other right within our community, there is a countervailing obligation—that is, if you want to exercise free speech, you have to tell the truth. So let us consider this matter which talks about censoring free speech. But, first, let me advise that in 1996 I displayed a poster produced by the Forest Protection Society in my Parliament House office. Guess what? A Mr Blakers, a name well known to Senator Brown because a Margaret Blakers in fact works for him, wrote me a letter threatening legal action that if I did not remove the poster they would sue me. Talk about legal bludgeoning! That is a wonderful example of it.QD4BROWNSenator Brown—Mr Acting Deputy President, I raise a point of order which goes to the matter of misleading of the Senate. What Senator Abetz is now talking about is an infringement of copyright, which is very much different from freedom of speech, and he knows it.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Sherry)—That is not a point of order, Senator Brown, as you well know.QD4BROWNSenator Brown—I have made my point.N26Abetz, Sen EricSenator ABETZ—If Senator Brown had allowed me the courtesy of continuing, I was going to say, yes, it was a matter of copyright, and I therefore made the offer to appropriately note on the poster that the photograph was taken by Mr Blakers. But of course that was not good enough. Why? Because the poster was such a devastating revelation of the untruths being told by the Wilderness Society that they wanted only one thing and that was the removal of the poster. Anything I offered to do to remedy the alleged breach of copyright was not good enough and therefore the poster had to come down.Senator Brown now has the expression on his face of the dog that hit the electric fence. Senator Brown, the people around you have been engaging in legal bludgeoning in exactly the same way that you are accusing the National Association of Forest Industries of doing. But let us deal with this book. On the very back cover it says:This book is published with the support of the Wilderness Society and BBC Hardware.We were told by Senator Brown that this book had been taken into the heart of BBC Hardware. Let us listen to what BBC Hardware has to say. A BBC Hardware spokesperson on 8 April 1999 said that the company had not authorised use of its name in the publication by the Wilderness Society. A complete untruth—completely deceptive, dishonest. It is a cruel hoax on the consumer, whom Senator Brown alleges he is somehow defending. In fact, it is unconscionable conduct by those who produced this book.We then have, also in relation to this book, the assertion that a major sawmiller had broken ranks with the National Association of Forest Industries. They quoted one Mr Kim Booth, the former failed Green candidate in the last state elections. And guess why he is against native forest harvesting. He tells us that he is the largest distributor of Oregon timber in Tasmania. He imports timbers from across the world to sell in Tasmania. Of course he does not want our local forest products to be used. He wants to use those nasty imports, Senator Brown, that you continually rail against. When it comes to importing timbers or using Australian timbers, I stand on the side of Australian timber. It has also been alleged in this book that our forests are disappearing. The foreword says:As Australia's native forests continue to disappear at an alarming rate . . .What are the facts? According to ABARE, Australia's forest cover has been growing since around 1980. For the last decade Australia's forest cover has been growing and that has been scientifically shown by ABARE, an independent organisation. But when you are running an extreme green campaign you never let the truth or the facts get in the way of a good story. Unfortunately for the Wilderness Society, on this occasion truth has come out and as a result a lot of people are now saying that they will not be associated with this booklet. Another example from the booklet is in the acknowledgments that appear on the front page. It says:The following companies have also generously assisted with time and information:Guess what the acknowledgments before that include. Margaret Blakers, a name I have mentioned before—an adviser to Senator Brown—and Senator Bob Brown himself. Undoubtedly he did assist with the untruths that are contained in this document. There are a number of companies such as French Pine from Tasmania which are deliberately listed in the acknowledgments. But what does French Pine from our home state of Tasmania have to say about this? Kevin French, managing director, said on 14 April 1999:I wish to advise that at no time leading up to the publication of the above did myself or any other company personnel have any contact with the authors of this publication. We have not and definitely would not give support for a booklet of this nature.And yet they quote French Pine as supporting these outrageous allegations in this document. Senator Brown has had the audacity to come in here and claim that he is somehow championing the cause of the consumer. He has championed the causes of misinformation, deceptive advertising and the misleading of consumers. He is guilty of conduct unbecoming of a senator.16:13:004042Bolkus, Sen NickSenator BOLKUSXE4SAALP00—We have had seven minutes from Senator Abetz. We heard a constant tirade of abuse at Senator Brown and everybody else involved on the Green side of the debate. The one thing we did not hear was the defence of NAFI. Why not? Because their action was indefensible. In this debate on a matter of public importance we are talking about an issue which should be and is critical to debate in Australia. We are discussing another attack—not an unprecedented one but another attack—by this particular industry group and by Dr Bain in a debate which is of particular concern to Australians.They have attacked this industry group, this company and this book because NAFI did not like what its opponents were saying in the debate. They did so because they had the financial resources to do so. They are the two unavoidable facts in this debate. This is not the first time. Senator Brown has mentioned other occasions on which people have been threatened with legal action. In 1991 I, as Minister for Administrative Services, wanted to restrain the use of old forest timber in government constructions and I also wanted to restrain the import of rainforest timber. I was met with a similar sort of reaction from NAFI and Dr Bain. I got a letter from a solicitor threatening me with defamation proceedings. This is the way this person has conducted public affairs when it comes to this issue. In this instance Dr Bain has gone over the top and I think he has embarrassed industry because of it.What actually was said that led to this reaction from Dr Bain? What were the actual comments in the booklet that caused such a reaction? There were five objections to comments in the book that were raised by NAFI's solicitor. One was a satirical comment by Mr Marr, who wrote:Are you the sort of customer who strides through the doors of your local hardware store and demands, `Give me a 15-metre beam . . . and make sure it's covered with the blood of at least one endangered species'?It was not a critical comment that was made in any other sense but the satire. NAFI then takes exception to the assertion that:. . . half our forests have disappeared. Australia has the worst record for plant and mammal species extinction in the world.Whether it is right or wrong, that was sourced to a document published by the Royal Zoological Society of New South Wales in 1991. Does NAFI want to go back to that source and tell them that they should withdraw as well? The third comment, on page 10, was:Less than 18 per cent of the average timber logging of an old-growth coupe in East Gippsland ends up in the sawmill.Where was that from? It was misreported, but it was from the Statement of Uses, Resources and Values put out by the Victorian state government in 1993. Let Dr Bain threaten Jeff Kennett as well.These are comments that are part of a normal political debate. As I said earlier, the action of NAFI was not just undemocratic but an abuse of power. We have here an industry organisation that is prepared to spend a lot of money to advocate its cause, but it was also prepared to spend more money to try to stop its opponents.Whatever you think of the arguments in this debate, I think all of us would reckon that particularly community organisations should not be under this sort of threat when they involve themselves in this debate. What is at the core here? I think the proprietor of Timber Wholesale and Timber World, Kim Booth, put it properly when he said:They've got no right to dictate to the public what they want to read.That is the essence of the debate here and that is the point that Senator Abetz could not address and could not rebut. We are talking in this area of a long and ongoing debate in Australian politics. But it is not just that issue of logging; it is also that fundamental issue of consumer information that Senator Brown referred to earlier on.This is not just the issue of democracy; it also reflects what I think is wrong with political debate on logging. What we should be getting here is encouragement of a relationship between industry and those in the community who are concerned about some logging practices and who are concerned about environmental and ecological outcomes. There needs to be more of this cooperative relationship between industry and retailers in a way that helps inform consumers. That is exactly what is going on across the world. Eco-labelling, consumer information and those sorts of initiatives are running worldwide. NAFI attempts to basically try and derail this particular initiative also poses problems because it does run contrary to what is happening in parts of Europe and North America and in other parts of the world.As I said, NAFI's action is a dangerous precedent for freedom of speech in this country. It is an attack on freedom of speech and it is one that I am pleased to see there has been a broad community reaction to. In response to those comments in the booklet, NAFI lawyers wrote to BBC Hardware saying that the booklet contained misleading and deceptive statements, and warned that they would seek a Federal Court injunction if it was not withdrawn.The Victorian Association of Forest Industries, which claims to have led the reaction, is warning that the timber industry could actively campaign against the national hardware chain. VAFI head Graeme Gooding wrote to BBC, saying:While you may gain some sales from `green' builders or consumers influenced by the misinformation in this book, you could lose as much in any backlash, if the people you are harming choose to campaign against BBC.So we have the threat of an active campaign against a national hardware chain—a threat which Mr Gooding says would lead to financial loss.It is no wonder that even Professor Alan Fels of the ACCC is investigating whether NAFI breached the Trade Practices Act in demanding that the BBC Hardware chain withdraw the book from sale or face legal action. I have not agreed with Professor Fels for quite some time, but I think his comments last week, when he dismissed NAFI's claim that the book contained deceptive and misleading comments, were pretty well to the point. He said it was pretty clear, as far as he could see, that the statements in the book were not actionable. He also said that any action to stop sales of the book based on alleged TPA practices would get a `frosty reception' in the Federal Court. I will tell you where else it would get a frosty reaction: it would get a very frosty reaction in the High Court as well. The High Court, over recent years, has entrenched in our constitutional structure freedom of political debate.The law is one thing, but I am really concerned with the fundamentals of this debate. There has been an overreaction which does threaten free speech. The reaction of civil libertarians was to be expected, but the reaction of a broad spectrum of people is something that this Senate should note as well. NAFI's threats in this particular instance got a reaction from Terry Lane, for instance, in the Sunday Age. He, I think quite pertinently, says:If the Trade Practices Act is used to stop evangelical greenies preaching their creed and fishing for converts, then it will be used against those who argue the ethical and environmental cases against eggs from battery chooks, pork from battery pigs, freeways through the forests, the eating of meat or the smoking of cigarettes.The point he makes is that it will become illegal to advocate whatever your cause might be. If it is not illegal, then it will become a lot more difficult.We should not underestimate the importance of financial resources in these sorts of battles. On the one hand, you consistently have—not just in this industry but across the spectrum—industries with resources to pursue their cases in court and elsewhere, and through lobbying exercises. On the other hand—I will not say more often than not, but I think universally—you have community organisations and individuals who are prepared to stand up and fight for environmental and community based concerns. What we do have here is an abuse of power, stifling democratic debate. As I said, it is based on this use of resources to bring about the outcome.We have had some interesting developments in this debate over the last couple of days. Again, it is worth noting that the National Party of Western Australia has taken a position which is quite different from the National Party in the federal parliament. Only yesterday, when the State Director of the Western Australian National Party, Jamie Kronborg, launched this particular book, Forest-Friendly Building Timbers, in the state of Western Australia, he said, `We're supporting sustainable forest management.' I think that is an act on his part that signals to the Australian government and to NAFI that maybe they need to pause in this particular debate and to take into consideration a broader spectrum of issues.As I said earlier on, I think Bain's reaction was over the top. It does damage to his cause but, unfortunately for him and the industry, it does damage to the timber industry as well. We have had one speaker from the govern ment, Senator Abetz. Probably more than anything that Senator Brown or I could say in defence of the booklet, Senator Abetz said it by not uttering a word in defence of the National Association of Forest Industries.16:23:004045Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—In the brief time I have available, I would like to indicate the support of the Australian Democrats for this matter of public importance. It is an important matter in the specific context of this attempt by the National Association of Forest Industries to censor free speech, to try to intimidate competitors and to try to ensure that information about encouraging the community to move away from native timbers does not get out into the broader community. The broader issue is one of intimidating anybody that tries to put forward an alternative point of view that might threaten the commercial position of a large commercial operator.The broader position relates to a specific piece of legislation which this Senate will debate when the government gets round to bringing it on for debate—the Regional Forest Agreement legislation. This sort of action is a perfect example of the reason why we as a parliament at Commonwealth level representing the Australian community nationally cannot afford to sign away our legal rights for over 20 years to monitor the activities of forest industries. This sort of action shows the lengths to which the National Association of Forest Industries will go to try to protect their commercial interests. Yet here we are as a parliament being asked to remove legal protections for our native forests and to put them in the hands of organisations such as the National Association of Forest Industries.It shows the sort of undue and excessive influence which can be brought to bear by large operators such as this one simply using legal processes to intimidate people who are trying to put an alternative point of view and get the facts out into the community. In this case they would seem on the surface to be fairly benign suggestions—encouraging people to increase their understanding of alternatives for utilisation of timber in building, renovation and design. And even in a case such as that we have the legal sledgehammer being brought down.I suppose one of the positive things out of the action of the Association of Forest Industries is that the publicity has in many ways probably led to greater sales for the book that may otherwise have been the case. As often happens with attempts to censor what people say, the resultant attention actually raises people's awareness to what is being put forward than would otherwise have been the case.We can see another example of that with the recent uproar amongst a small number of people about the film Lolita, which has led to it getting substantially larger numbers of people going to see it than would otherwise have been the case. I am not sure of the building links between Lolita and the native forests timber industry, but the issue of censorship is an important one.I hope the Association of Forest Industries does rethink its stance on this particular issue. Certainly, from the Democrats' perspective at both federal and state levels, any attempt by large industry organisations to try to stifle alternative viewpoints must be opposed. I know my colleague in the Western Australian upper house, Norm Kelly, has spoken out equally strongly about the actions of NAFI in this regard—with the Western Australian parliament and the Western Australian community more broadly being embroiled in the current debate over the regional forest agreements and the current threat to Western Australia's forests, which even the WA National Party have finally recognised are very much under threat. I do hope this federal parliament does not aid in the destruction of those forests.16:27:004045Gibson, Sen BrianSenator GIBSONBX5TASLP10—The arguments between NAFI and the book's publisher are basically—apart from the courts—a matter for the ACCC. What we are really talking about are misleading statements contained in this document entitled Forest-Friendly Building Timbers . I support the industry's stance on this matter because it is just wrong to have statements such as:Australia's native forests can't go on providing our building timbers without the threat of massive extinctions.This is just incorrect. That was on the back cover of the document. The facts are as the 1990 government study into ecologically sustainable development chaired by the Director of CSIRO's Institute of Natural Resources and Environment found:There have been no known extinctions of Australian native fauna and flora species as a result of timber harvesting over a period of more than 100 years.Another misleading statement is contained on page 10 when it says that less than 18 per cent of native timber logging in East Gippsland ends up in sawmills. The fact is that it is about two-thirds rather than 18 per cent. Again, there is misleading information in the document. A third example of misleading information is on page 11 of this document where it says, `It is a myth that Australia's native forests are managed sustainably.'QD4BROWNSenator Brown—Absolutely true.BX5Gibson, Sen BrianSenator GIBSON—It is absolutely misleading, Senator Brown. I quote the Resources Assessment Commission, which you are well aware of and which the Hawke government brought in to look at this question of whether forests should be conserved or managed on a sustained yield basis. That RAC report released in March 1992 found:The Inquiry is satisfied that currently the agencies have in place sustained yield management strategies for wood production.It supported the continuation of harvesting of native forests. This document has misleading information in it, there is no question about it.In the last few minutes that I have available to me, I would like to put on the record for the Senate and the community that the Howard government supports the use of sustainable forest resources through the promotion of the plantation industry and through the conservation of our native forests by a comprehensive, adequate and representative reserve system and by ensuring that commercial management and use of the forests outside the formal reserve system are managed in an ecologically sustainable way. With regard to plantations, the Howard government has been active in promoting plantation forestry. It has thrown its weight behind the Plantations 2020 Vision, which is an initiative of a partnership between the plantation growing and processing industries and all three levels of government in Australia.This program encourages private plantation investment with the aim of trebling the area of plantations in Australia by the year 2020. This will involve planting, on average, an area of 80,000 hectares a year. Already we have seen the plantation average lifted from 20,000 hectares a year in the early 1990s to last year's figure, which I understand was about 50,000 hectares.Other Commonwealth achievements encouraging plantations include progress on tax treatment of plantations and the removal of controls on exports of unprocessed plantation and timber. A positive example of the use of plantations is the announcement of the plan by Visy Paper to build a $450 million mini kraft pulp mill and paper mill at Tumut in New South Wales.Senator Brown interjecting—BX5Gibson, Sen BrianSenator GIBSON—Cut it out. We are also encouraging our farmers to become involved through the Farm Forestry Program, through which a $7.8 million program has been provided this financial year from the Natural Heritage Trust. Farm forestry is the incorporation of commercial tree growing into farming systems, and the Farm Forestry Program has helped 190 national and regional projects.Turning to native forests and the regional forest agreements, these are the agreements which resulted after the Labor government, over 13 years, desecrated the industry by favouring Greens against the forest industry. But in the end the Labor government was forced to reach an agreement with the states and to go through proper scientific process as to what parts of the native vegetation should be set aside in comprehensive and regional reserves, and what parts should be left for sustained yield management of wood and other products.Whereas the Labor government failed to reach agreements, this government has gone ahead with that process, and regional forest agreements have been set up with the states. Those regional forest agreements seek to establish a sensible balance between providing job and resource security for the industry and achieving a comprehensive, adequate and representative system of forest reserves. Prior to signing those agreements, each forested region was assessed comprehensively for all forest values, including wilderness, old growth, biodiversity, national estate, indigenous, social, economic and world heritage values. That was done comprehensively between the states and the Commonwealth.The economic and social impacts were taken into account in those that have been completed. The Howard government has provided more than $50 million this financial year for ongoing implementation of the RFA process. Regional forest agreements have been completed for east Gippsland and the central highlands in Victoria and also in my home state of Tasmania. I have been supplied with figures by Environment Australia of the significant areas of forest added to the current reserve system by the RFAs.In east Gippsland the CAR reserve system covers 514,000 hectares, of which 13,000 are an addition arising out of the recent process. In the central highlands, the CAR reserve system covers 297,000 hectares, with 116,000 hectares having been added. In Tasmania a remarkable 2.7 million hectares is in the CAR reserve system and 396,000 hectares have been added. The Tasmanian RFA included a Commonwealth commitment to provide financial assistance for employment and industry development. Funding for the Tasmanian RFA will total $110 million over three years.16:34:004047Forshaw, Sen MichaelSenator FORSHAW656NSWALP00—When it comes to hardware stores, I have to confess that I am a totally frustrated, unqualified, do-it-yourself carpenter. I must admit I have wiled away many hours strolling through my local BBC Hardware store or the Mitre 10 store or Hudsons—these are not unpaid ads, I might say, but they are the stores in my area. I love nothing better than looking at all those wonderful gadgets and planning and thinking about those jobs that I could do at home, such as building the pergola that I have been promising my wife for the last two or three years.I must say that when I received the booklet that was sent to me by Senator Brown—which has been endorsed, I understand, by BBC Hardware—I was intrigued. It came in an envelope from Senator Brown, and I thought, `We're in the middle of this big debate about regional forest agreements. Here's some more propaganda from Bob Brown—we've got to take this with a grain of salt,' particularly after some of those terribly insulting things that you have said about us in this chamber, Senator Brown.QD4BROWNSenator Brown—Well, they were accurate.656Forshaw, Sen MichaelSenator FORSHAW—They were not accurate, and you know they were not. I will come back to that in a minute. So I thought that I should look at the document carefully, but when I opened up the envelope and glanced through the publication I thought, `This could actually be useful. This could be like one of the many brochures that I've collected from hardware stores on how to build a barbecue using only a bag of cement and a trowel and you don't even get your hands dirty, or how to build a bookcase, but done nothing about.' I glanced through it and I thought, `Yes, there is some very useful information in this booklet.' But I was also intrigued. Why had this come from Senator Brown? I looked at it closely. It is a very subtle and, I would suggest, a somewhat deceptive publication because it also pushes a very strong message on behalf of the Wilderness Society that not only should we be moving to greater use of plantation timber—something that I am sure we all support—but that timber from native forests is all bad and we should not have anything more to do with it.I can therefore understand why Dr Bain—who has long represented the interests of timber companies—and his organisation got a bit upset. But equally I have to say that just as we have extreme reactions on the environmentalist side of this debate, often represented by the views espoused by Senator Brown, we do get extreme reactions from the forest industry side. Unfortunately, on this occasion that is what happened. NAFI—the National Association of Forest Industries—and Dr Bain did overreact. It is not as if they had not seen the sorts of claims that are contained in this book about the native forest industry before. They had heard those accusations for many years, and I agree that some of them are wildly inaccurate. So to take the step, as we understand happened, of putting pressure on the BBC Hardware company to withdraw this publication from its stores was, in my view, a major overreaction. I believe it did the association some damage and it certainly did not assist their cause of trying to promote rational debate and rational sustainable development of the timber industry in this country into the future.So I do not defend the actions taken by NAFI. I think they could have just let this one slide through to the keeper. As I said, there is some worthwhile information in this booklet which I would suggest the vast majority of people—those who visit those hardware stores, like I do; and I suspect there are many hundreds of thousands of Australians who do—would be interested in reading. I can understand NAFI getting concerned when there is a page in the booklet which is headed, `We do not recommend use of any timbers or products made from native forests. Here is a list of timbers, products and companies to avoid.' And there is a very long list. If you followed that recommendation to the letter, you would never build anything out of timber in your life, because it covers just about every form of timber that is available on the market, other than some plantation species. So I can understand NAFI's reaction.I also want to put clearly on the record—because we all know this is a very passionate issue—that, when the government gets around to bringing its Regional Forest Agreement legislation on for debate in this parliament, we will get a chance to debate those issues further, and hopefully in a more constructive atmosphere than we have in this debate this afternoon.As I said, it is a very passionate issue. Extreme views, unfortunately, do exist on both sides of the debate. On one side, the conservation groups believe that there is no other solution than to shut down overnight all operations with respect to logging of native forest timber—putting many thousands of workers out of jobs and affecting many thousands of families and many companies, particularly small sawmilling companies. On the other side of the debate you have the extreme views of those in the timber industry who—and I must say it is a small minority these days—do not want to have any truck at all with any arguments put forward by the conservation movement.But I have to say this to Senator Brown: in putting forward this matter of public importance today—which we support in principle because we do have a concern about the attempt here to deny free speech, which is an issue that is going to be looked at by the ACCC, as has been acknowledged—it is a pity that you do not follow that other legal maxim which says, `If you are going to complain about conduct, come with clean hands.' There have been actions taken by environmental groups, particularly some associated with groups such as the Wilderness Society, which I would suggest have been just as damning in terms of their attempts to deny free speech and to deny companies the opportunity to carry out their legitimate operations.One only has to look at the campaign that was conducted both in this country and in the United Kingdom against Tesco with respect to the sale of kangaroo meat to see the damage that can be done to our export industry by totally unfounded, extravagant claims made by some environmental groups. It is a legitimate industry, and Senator Brown's supporters have totally ignored that fact and have set out with some quite untrue claims—QD4BROWNSenator Brown—Do you want to ban their point of view?656Forshaw, Sen MichaelSenator FORSHAW—No, I do not want to ban their point of view. But what I object to, the same as you do, are the extravagant, extreme campaigns and claims. The point I am making, Senator Brown, is that if you are going to come into this chamber and complain about what NAFI does, then how about having a look at your own backyard as well?I will finish on this note. The important thing to remember in this whole debate is that a process was set up by the previous Commonwealth Labor government—and it has been endorsed by the present government and supported by the state governments—to, over the long term, develop and maintain a sustainable timber industry in this country. That is of course outlined in the National Forest Policy Statement, which we are all aware of. A central plank of that is the increasing development of a plantation industry and a move to the use of plantation timbers—but it must be done in harmony with the proper, sustainable use of native forest timber. Unfortunately, the environmental lobby do not accept the principle that the native forest timber industry can continue to exist along with a move to greater use of plantation timber. So I say to Senator Brown: whilst I clearly do not accept what NAFI did, and I object strongly to the pious comments made by Senator Abetz and his colleagues, have a look at your own actions. (Time expired)16:44:004049Crane, Sen WinstonSenator CRANEUW4WALP10—Right at the beginning, I want to say that I agree with a lot of what Senator Forshaw said, but I do have a real problem with having before us in this matter of public importance an argument as to whether or not NAFI or anybody else are using their legal rights—a method of censoring—to protect themselves when they believe they have been misrepresented. That is really what this is all about. They believe they were aggrieved. They went through the proper processes of informing the people concerned that they were considering legal action, and now they are being condemned in this place. If this chamber does not uphold the right of people to protect themselves in the law courts and use those mechanisms, something has gone wrong with the place.QD4BROWNSenator Brown—They haven't gone to the courts.UW4Crane, Sen WinstonSenator CRANE—No, they informed them. Listen to what I have got to say.QD4BROWNSenator Brown—They just used the threat.UW4Crane, Sen WinstonSenator CRANE—The Senate Regional and Rural Affairs and Transport References Committee went through the resource security hearings very recently in Melbourne. Who turned up there with legal opinions to chal lenge the legality of the legislation on constitutional grounds? It was none other than Senator Brown. So it is fine for him, on the one hand, to put up a legal opinion and use it as a threat against legislation but, on the other hand, to say that NAFI does not have the same right. I find that incomprehensible, I find it inconsistent, I find it unfair and I find it wrong. Furthermore—and here I agree with Senator Forshaw—what is the mechanism that Senator Brown and his supporters use? They go and lie in front of bulldozers. They interfere with the legal rights of people to carry out their lawful business. They cost them money.QD4BROWNSenator Brown—The woodchippers sent in thugs and you know it.UW4Crane, Sen WinstonSenator CRANE—They interfere with their jobs and they carry on this process of unlawful activity. On the one hand, they come in here and say, `You cannot do this, this is a censoring of free speech,' which I disagree with absolutely and totally. On the other hand, they think they can take the law into their own hands. I sit in the middle of this debate on a proper sustainable development forestry policy—and I have sat there for a long time. I have argued very strongly for proper sustainable development in our forests and at the same time for development of our plantations. If I have got time, I will come to our very proud record in Western Australia on plantations. But his inconsistency in bringing this motion forward and activities elsewhere I think is a blight on Senator Brown.At our committee hearings in Melbourne for two days there were a number of attempts made by people in the audience, supporters of Senator Brown, including some of his staff, to intimidate witnesses in front of us, to the point that on a couple of occasions I had to call them to order and I had to ask that his staff should at least demonstrate that they know the way to behave. They were endeavouring to intimidate witnesses who were putting a contrary point of view to the point of view that they held.QD4BROWNSenator Brown—Members of that committee were rude to environmentalists and you did nothing to stop it.UW4Crane, Sen WinstonSenator CRANE—I had to call those people to order.QD4BROWNSenator Brown—You were biased.UW4Crane, Sen WinstonSenator CRANE—Mr Acting Deputy President, you can let him rabbit on all the time. He is just helping my argument and my position.QD4BROWNSenator Brown—You were biased.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Sherry)—Order! Senator Brown, I have been fairly tolerant of the level of exchange to date, but you are really getting out of hand. Would you please give Senator Crane a go.UW4Crane, Sen WinstonSenator CRANE—You can talk about all the bias in the world, the bias on one side and the bias on the other side. I do not think there is really that much difference in the level of bias. What we as legislators have to do is try and get to a balanced position, and that is what the National Forest Policy Statement was all about. That was developed in 1992, when the now opposition was in government, with our support at that particular time. What the RFA process is all about is getting sustainable development in the use of our forests and, alongside that, developing our plantation industries.I want to deal with the issue of the Australian Competition and Consumer Commission. Professor Fels made some statements last week and was investigating this issue. I have a statement here that has been handed to me which I am prepared to table with the letter. It is from NAFI. It says:The Australian Competition and Consumer Commission has not found any breach of the ACCC rules by NAFI in relation to the Forest-Friendly Building Products book. In a letter to NAFI today they have indicated there is no suggestion of any threats or implied threats of exclusionary boycotts by the Association. We have been told that unless anything new comes up there will be no more contact with NAFI.I just put that on the public record. In my remaining time I want to put some positive things into the debate from this side. I want to relate what has been happening in Western Australia in the development of the softwood and hardwood estates. While I cannot go over all the detail of this, can I just say that from 1960 we have seen an increase in the national estate for softwood from practically zero to almost 100,000 hectares today. That demonstrates the developments that are occurring. When we look at what is happening in the hardwood estate, by species, age and class, we find that we have seen an increase from slightly more than zero in 1960 to in the area of 68,000 hectares now, and that is still growing. I understand from my colleague Senator Murphy on the other side that Tasmania can demonstrate the same sorts of figures in the development of the plantation estate.While this plantation estate has been developed at its present rate, we will find that there will be an even greater increase in the utilisation of timber out of the national estate developed through plantations. This piece of paper I have got in front of me informs us that in Western Australia something like 200,000 hectares have been planted and that there is potential for about another 150,000 that can commercially produce timber, and that is growing year by year. This does not include any areas on private land where there is also an extensive plantation industry being developed. I think the context in which this matter of public importance has been brought before us is very unfortunate. I am looking forward to the day when we can actually debate the forests in a positive manner in this place. (Time expired)16:52:004050O'Brien, Sen KerrySenator O'BRIEN8O6TASALP00—In relation to this matter, it would indeed be regrettable if the legal processes of this country were being used to censor free speech. There have been many occasions when just such action has taken place. No matter how much that action has been permitted by the law, the intent of the action has been to censor free speech. The Labor Party is not going to support an action which is so designed. The best way to describe NAFI's actions in this matter is as ill-advised and as somewhat of an overreaction to a publication—which has, in effect, given the proponents of the publication the opportunity to get for it some headlines and some promotion that they would not otherwise have received.If the intention of Dr Bain and NAFI was to stop the promulgation of the information in the publication, they have achieved exactly the opposite. To the extent that there is any censuring of NAFI in this matter, they are probably smarting more from their own misplaced actions than from any proposed censuring that might occur.As I said, we do agree with free speech. I want to agree with the comments of Senator Crane, particularly arising from the legislation committee hearings into the regional forest agreements legislation. We were subjected to a process in hearings where we had, on the one hand, the proponents of the environment movement saying that we should be using no native forest timbers and that the RFA process was bad—and we heard those people in silence. But when proponents of the sustainable use of native forests under the proposed legislation spoke we heard all sorts of comments. We had someone blowing some form of whistle during the hearings and we had sniggers and attempts to belittle the evidence given by witnesses—which seemed to me to be an attempt to somehow hinder those witnesses' rights to give evidence to the committee and an attempt to belittle the evidence of those witnesses before the committee.In respect of the matter before us, what has been said, particularly by Senator Forshaw, is true: the environment movement does from time to time engage in actions which are contrary to the spirit of the comments contained in the letter, from Senator Brown to the President, that brings on this debate. Senator Brown moved a motion to congratulate the proponents of the publication, and that was the subject of a vote in this chamber. I do not in any way intend to canvass the vote other than to say that I regarded the third paragraph, paragraph (c) of the motion, as a paragraph which in effect was condemning the use of native forest timbers. I think the term used was `wild forest'.The Labor Party did propose to the motion of Senator Brown amendments of this calibre, removing that rather one-sided paragraph and replacing it with the following:(c) notes that the RFA process, initiated by the former Labor Government, promotes an expansion of plantation based timber resources—One would have thought that one could support that; but no, that could not be supported by Senator Brown—(d) believes that a balanced approach to forestry, including the promotion of the use of plantation based forestry resources will reduce pressure on our native forests, maximising job opportunities and assist in sustaining our forest industries.Was that acceptable to Senator Brown? No, it was not acceptable, because there is only one outcome which is acceptable to the Wilderness Society and to Senator Brown, and that is the locking up of our native forests. The Labor Party do not support that. We support a balanced approach to forestry. We support both a plantation based forest industry and a forest industry based on native forests.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Sherry)—Order! The time for the debate has expired.Committees40514051405116:57:004051O'Chee, Sen BillSenator O'CHEEEU4QLDNP10—On behalf of Senator Payne, I present the report of the Legal and Constitutional Legislation Committee on the provisions of the Migration (Visa Application) Charge Amendment Bill 1998 and on the Migration Legislation Amendment Bill (No. 2) 1998 [1999] together with submissions and Hansard record of proceedings.Ordered that the report be printed.4051405116:57:004051O'Brien, Sen KerrySenator O'BRIEN8O6TASALP00—On behalf of Senator Cooney, I present the sixth report of 1999 of the Senate Standing Committee for the Scrutiny of Bills. I also lay on the table Scrutiny of Bills Alert Digest No. 6 of 1999 , dated 21 April 1999.Ordered that the report be printed.4052405216:58:004052O'Chee, Sen BillSenator O'CHEEEU4QLDNP10—On behalf of Senator Payne, I present the report of the Legal and Constitutional Legislation Committee on the Migration Legislation Amendment (Judicial Review) Bill 1998 [1999], together with submissions and Hansard record of proceedings.Ordered that the report be printed.Bills4052A message from His Excellency the Governor-General was reported, informing the Senate that he had assented to the following laws: A New Tax System (Fringe Benefits Reporting) Bill 1998 A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Bill 1998 Airports Amendment Bill 1999 Financial Management Legislation Amendment Bill 1999 Health Legislation Amendment Bill (No. 2) 1999 Referendum Legislation Amendment Bill 1999 . Committees4052405210000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Sherry)—The President has received a letter from the Leader of the Opposition in the Senate nominating senators to be members of various committees.Motion (by Senator Ian Campbell)—by leave—agreed to:That Senators be appointed to committees as follows:Economics Legislation Committee—Participating member: Senator Conroy.Economic References Committee—Participating member: Senator George Campbell. Bills4053r703Billsr667Billsr666Billsr702Billsr699Billsr698Billsr664Billsr660Billsr658Billsr657Billsr701Billsr663Billsr659Billsr700Billsr661Bills4053r754Billsr755Billsr761Billsr765Billsr763Billsr764Billsr757Billsr760Billsr758Billsr759Billsr756Billsr7624053Debate resumed.17:00:004053O'Chee, Sen BillSenator O'CHEEEU4QLDNP10—Before we go to the vote on the motion before the chair, may I foreshadow that at the conclusion of this I shall seek leave to move a motion to recommit another vote taken earlier this day.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—I put the question that Senator Carr's amendment as printed on sheet 1338 in respect of A New Tax System (Australian Business Number) Bill be agreed to.17:06:00The Senate divided. (The President—Senator the Hon. Margaret Reid)32Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Carr, K.Conroy, S. Cook, P. F. S.Cooney, B. Crossin, P. M.Crowley, R. A. Denman, K. J.Evans, C. V. Faulkner, J. P.Forshaw, M. G. Gibbs, B.Hogg, J. Lees, M. H.Lundy, K. Mackay, S.Margetts, D. Murphy, S. M.Murray, A. O'Brien, K. W. K.*Quirke, J. A. Ray, R. F.Reynolds, M. Sherry, N.West, S. M. Woodley, J.33Alston, R. K. R. Brownhill, D. G. C.Calvert, P. H. Campbell, I. G.Chapman, H. G. P. Colston, M. A.Coonan, H. Eggleston, A.Ellison, C. Ferguson, A. B.Ferris, J. Gibson, B. F.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.O'Chee, W. G.* Parer, W. R.Patterson, K. C. L. Payne, M. A.Reid, M. E. Synon, K. M.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Newman, J. M.McKiernan, J. P. Boswell, R. L. D.Schacht, C. C. Abetz, E.Stott Despoja, N. Crane, W.* denotes tellerQuestion so resolved in the negative.17:08:004054O'Chee, Sen BillSenator O'CHEEEU4QLDNP10—by leave—I seek leave to have the question on the amendment proposed by Senator Carr to the second reading of the A New Tax System (Goods and Services Tax Transition) Bill 1998 on sheet 1343 taken again and to make a brief statement.17:08:004054Faulkner, Sen JohnSenator FAULKNER5K4NSWALP00—by leave—The approach that the opposition has consistently taken when, for one reason or another, the result of a division does not reflect the will of the electorate is to grant leave and allow a recommittal to take place. While that has been our approach, and will be our approach on this occasion, it has become a matter of courtesy to provide the Senate with an explanation. The point I make is this: if an explanation is provided to the Senate, then leave will be granted for a recommittal.17:10:004054O'Chee, Sen BillSenator O'CHEEEU4QLDNP10—by leave—I assume that constitutes granting leave. What happened in the division before the Senate moved to consideration of matters of public interest was that a division had been concluded and the next division was called on. A number of senators had in fact left the chamber and, although an attempt was made by some honourable senators to draw your and my attention to the fact that they had left the chamber, that clearly was not successful. Therefore, two coalition senators, through no fault of their own—AW5CARRSenator Carr—They had left the chamber.EU4O'Chee, Sen BillSenator O'CHEE—Senators are entitled to leave the chamber between divisions, Senator Carr. Having left the chamber before the division was called on, those senators were then precluded from the opportunity of having a vote, through no fault of their own. In those circumstances, Madam President, I suggest it is entirely appropriate that this matter be recommitted and the will of the Senate be seen. 10000PRESIDENTThe PRESIDENT—The proposition is that leave be given for the amendment moved by Senator Carr as recorded on sheet 1343 to be recommitted.Leave granted.10000PRESIDENTThe PRESIDENT—The question now is that Senator Carr's amendment in respect of the A New Tax System (Goods and Services Tax Transition) Bill 1998 be agreed to.17:12:00The Senate divided. (The President—Senator the Hon. Margaret Reid)32Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Carr, K.Conroy, S. Cook, P. F. S.Cooney, B. Crossin, P. M.Crowley, R. A. Denman, K. J.Evans, C. V. Faulkner, J. P.Forshaw, M. G. Gibbs, B.Hogg, J. Lees, M. H.Lundy, K. Mackay, S.Margetts, D. Murphy, S. M.Murray, A. O'Brien, K. W. K.*Quirke, J. A. Ray, R. F.Reynolds, M. Sherry, N.West, S. M. Woodley, J.33Alston, R. K. R. Brownhill, D. G. C.Calvert, P. H. Campbell, I. G.Chapman, H. G. P. Colston, M. A.Coonan, H. Eggleston, A.Ellison, C. Ferguson, A. B.Ferris, J. Gibson, B. F.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.O'Chee, W. G.* Parer, W. R.Patterson, K. C. L. Payne, M. A.Reid, M. E. Synon, K. M.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W.Collins, J. M. A. Hill, R. M.Hutchins, S. Newman, J. M.McKiernan, J. P. Boswell, R. L. D.Schacht, C. C. Abetz, E.Stott Despoja, N. Crane, W.* denotes tellerQuestion so resolved in the negative.10000PRESIDENTThe PRESIDENT—We now proceed to the question that these bills be now read a second time. I understand there is an agreement that we will deal firstly with the first six bills as listed on the Notice Paper on page 4. The question is that the A New Tax System (Goods and Services Tax) Bill, the A New Tax System (Goods and Services Tax Imposition—Excise) Bill, the A New Tax System (Goods and Services Tax Imposition—Customs) Bill, the A New Tax System (Goods and Services Tax Imposition—General) Bill, the A New Tax System (Goods and Services Tax Administration) Bill and the A New Tax System (Goods and Services Tax Transition) Bill be now read a second time.17:19:00The Senate divided. (The President—Senator the Hon. Margaret Reid)40Abetz, E. Allison, L.Alston, R. K. R. Bartlett, A. J. J.Bourne, V. Brownhill, D. G. C.Calvert, P. H. Campbell, I. G.Chapman, H. G. P. Colston, M. A.Coonan, H. Eggleston, A.Ellison, C. Ferguson, A. B.Ferris, J. Gibson, B. F.Heffernan, W. Herron, J.Kemp, R. Knowles, S. C.Lees, M. H. Lightfoot, P. R.Macdonald, I. Macdonald, S.MacGibbon, D. J. McGauran, J. J. J.Minchin, N. H. Murray, A.O'Chee, W. G.* Parer, W. R.Patterson, K. C. L. Payne, M. A.Reid, M. E. Synon, K. M.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W. Woodley, J.25Bishop, T. M. Bolkus, N.Brown, B. Campbell, G.Carr, K. Conroy, S.Cook, P. F. S. Cooney, B.Crossin, P. M. Crowley, R. A.Evans, C. V. Faulkner, J. P.Forshaw, M. G. Gibbs, B.Hogg, J. Lundy, K.Mackay, S. Margetts, D.Murphy, S. M. O'Brien, K. W. K. *Quirke, J. A. Ray, R. F.Reynolds, M. Sherry, N.West, S. M.Boswell, R. L. D. McKiernan, J. P.Crane, W. Schacht, C. C.Hill, R. M. Hutchins, S.Newman, J. M. Collins, J. M. A.Stott Despoja, N. Denman, K. J.* denotes tellerQuestion so resolved in the affirmative.10000PRESIDENTThe PRESIDENT—We now proceed to the remaining 21 bills listed on page 4 of today's Notice Paper . There are amendments to A New Tax System (Australian Business Number) Bill 1998 and A New Tax System (Commonwealth-State Financial Arrangements—Consequential Provisions) Bill 1999.Noting the two amendments referred to, the question is that the A New Tax System (Australian Business Number) Bill 1998, the A New Tax System (Australian Business Number Consequential Amendments) Bill 1998, the A New Tax System (End of Sales Tax) Bill 1998, the A New Tax System (Personal Income Tax Cuts) Bill 1998, the A New Tax System (Compensation Measures Legislation Amendment) Bill 1998, the A New Tax System (Bonuses For Older Australians) Bill 1998, the A New Tax System (Income Tax Laws Amendment) Bill 1998, the A New Tax System (Aged Care Compensation Measures Legislation Amendment) Bill 1998, the A New Tax System (Trade Practices Amendment) Bill 1999, the A New Tax System (Commonwealth-State Financial Arrangements) Bill 1999, the A New Tax System (Commonwealth-State Financial Arrangements—Consequential Provisions) Bill 1999, the A New Tax System (Wine Equalisation Tax) Bill 1999, the A New Tax System (Wine Equalisation Tax Imposition—General) Bill 1999, the A New Tax System (Wine Equalisation Tax Imposition—Customs) Bill 1999, the A New Tax System (Wine Equalisation Tax Imposition—Excise) Bill 1999, the A New Tax System (Luxury Car Tax) Bill 1999, the A New Tax System (Luxury Car Tax Imposition—General) Bill 1999, the A New Tax System (Luxury Car Tax Imposition—Customs) Bill 1999, the A New Tax System (Luxury Car Tax Imposition—Excise) Bill 1999, the A New Tax System (Indirect Tax Administration) Bill 1999 and the A New Tax System (Wine Equalisation Tax and Luxury Car Tax Transition) Bill 1999 be read a second time.Question resolved in the affirmative.Bills read a second time.17:25:004056Campbell, Sen IanSenator IAN CAMPBELLH15WALP10—I move:That consideration of the following bills in committee of the whole be made an order of the day for 23 April 1999: A New Tax System (Goods and Services Tax) Bill 1998 A New Tax System (Goods and Services Tax Imposition—Excise) Bill 1998 A New Tax System (Goods and Services Tax Imposition—Customs) Bill 1998 A New Tax System (Goods and Services Tax Imposition—General) Bill 1998 A New Tax System (Goods and Services Tax Administration) Bill 1998 A New Tax System (Goods and Services Tax Transition) Bill 1998 A New Tax System (Australian Business Number) Bill 1998 A New Tax System (Australian Business Number Consequential Amendments) Bill 1998 A New Tax System (End of Sales Tax) Bill 1998 A New Tax System (Personal Income Tax Cuts) Bill 1998 A New Tax System (Compensation Measures Legislation Amendment) Bill 1998 A New Tax System (Bonuses for Older Australians) Bill 1998 A New Tax System (Income Tax Laws Amendment) Bill 1998 A New Tax System (Aged Care Compensation Measures Legislation Amendment) Bill 1998 A New Tax System (Trade Practices Amendment) Bill 1999.It was the government's hope that the committee stage would commence immediately after the vote for the second reading. We are, of course, very pleased that the Senate has supported the second reading of these important bills. We had expectations, particularly having negotiated and had the support of the majority of the Senate to sit during this special and extraordinary fortnight, that this fortnight would be devoted to debating these `a new tax system' bills. We were informed early yesterday afternoon, via the Parliamentary Liaison Office, via the whip of the Democrats, that the Democrats would not be able to commence debate on the committee stage for another week, because their amendments were not ready. We were informed yesterday afternoon—that is Tuesday afternoon—that they would not be able to commence the debate until next Tuesday afternoon. That is one week from yesterday afternoon.We were flabbergasted. We were disappointed. We thought there was a clear understanding that this week would be made available for the debate of these bills. To be told, less than a day into that debate, that the Democrats would not be available to proceed with this debate for at least a week was an incredible announcement to us. In the time since we were told that news—that we consider extremely bad news—we have sought from the Democrats an undertaking that those amendments would be ready to go to the committee stage perhaps tomorrow or Friday. In fact the Democrats had—AW5CARRSenator Carr—Perhaps Tuesday, perhaps Wednesday.H15Campbell, Sen IanSenator IAN CAMPBELL—Who would know, Senator Carr?AW5CARRSenator Carr—That is the point. You know.H15Campbell, Sen IanSenator IAN CAMPBELL—I do not know. I have asked the Democrats when they will be ready. I was given an indication yesterday afternoon that they might be ready on Friday but they could not be sure. Somehow the length of the second reading debate, because in the eyes of the Democrats it had apparently gone fast, had stopped them from being able to do the committee stage on Friday. I am not exactly sure how. In fact, the second reading debate is one of the longest second reading debates in the history of this great parliament. It was longer than the native title debates on all occasions, longer than the second reading debate on workplace relations, longer than the second reading debate on all three tries at the Telstra bills, and it was just about as long as the infamous or famous, important debate that Senator Bolkus would remember on the political advertising and broadcasting bill, at about 14 hours or so. I am sure Senator Bolkus remembers it well.So it has been an extraordinarily long debate on the second reading. It has not been a quick debate, as some people seem to imply. Indeed, these bills have been before the parliament since December last year, so the Democrats have had four months to prepare their amendments and to have drafting instructions prepared. We would have hoped this delay was not going to take place.I have moved that debate on the committee stage of this bill not commence now until Friday. This gives the Democrats the rest of today and all of tomorrow to try and get their amendments in order. We would have preferred to have started the debate today. We would have preferred to start it tomorrow. We are not at all happy with the concept of having to wait till Friday. It is fair to say, however, from my own bitter experience, that if you do seek to start a committee stage debate when major players in the debate are not ready with their amendments and there is not a comprehensive running sheet available, then the debate bogs down and time is wasted and the time is not productive.So I have moved this motion. I have asked the Democrats if they will be ready on Friday, but they cannot give me any assurance. In fact, all indications are that the Democrats will not be ready on Friday. I hope they will feel some obligation to be ready on Friday.I have also sought from the Democrats—and I have informed the opposition of this very candidly, and I do not expect them to support what I am proposing—since we were working on the assumption that this fortnight would be available for debating the tax bills, their support for extending sitting hours next week to make up for the time the Senate chamber will lose this week to consider these bills in the committee stage. I am still hopeful that the Democrats will see that there is some sort of obligation upon them to agree to that proposition. I have been assured by Senator Lees, and I accept her assurance at face value, that she is not seeking to delay these bills. But I have to say that assurance is undermined somewhat by their performance and behaviour.Democrats senators interjecting—H15Campbell, Sen IanSenator IAN CAMPBELL—You cannot come to us and say, `Sorry, you can't have extra hours to deal with the committee stage of these bills next week, even though we are costing you something like nine or a dozen hours this week. So if we need it, we will give it to you later, some time down the track.' One could only expect that, with four months to prepare their amendments, their bona fides have to be brought into question. They can resolve the question of their bona fides on this matter if they agree to the proposition that we sit for longer hours to make up the hours that will be lost this week. So, with great reluctance, I have moved this motion which would defer consideration of the committee stage of these bills until Friday 23 April.17:32:004057Faulkner, Sen JohnSenator FAULKNER5K4NSWALP00—This motion is not supported by the opposition. I think we need to be very clear about what is happening in the chamber right now: the government is preventing consideration of its own GST legislation. In the view of the opposition that is an absolute farce. What a shemozzle we have on our hands now, courtesy of the government. What an absolute disgrace from the government in relation to what they claim is the most important tax legislation in the history of the Commonwealth parliament. I suppose this is what happens—Honourable senators interjecting—10000PRESIDENTThe PRESIDENT—Order! There is too much noise in the chamber.5K4Faulkner, Sen JohnSenator FAULKNER—I suppose, Madam President, this is what happens when you leave such important tax legislation in the hands of people like Senator Alston and Senator Kemp. If the government actually wants to salvage its tax package, it ought to get John Howard back to Canberra now and see if he can run the show.AW5CARRSenator Carr—That's right! Bring back John!5K4Faulkner, Sen JohnSenator FAULKNER—And bring back Peter Costello and see if he can run the show. Let us see if the Treasurer and the Prime Minister can try to sought this mess out. The coalition Senate leadership has really let the Prime Minister and the Treasurer down. I have to say that I suspect this whole process has, unfortunately, not been assisted by the fact that Senator Hill has been overseas. When you have an indolent dilettante like Senator Alston running the show, this is what you get.10000PRESIDENTThe PRESIDENT—Senator Faulkner! That language is not appropriate.5K4Faulkner, Sen JohnSenator FAULKNER—If it was not appropriate, Madam President, of course I withdraw it. When you have someone like Senator Alston running the show, the government's strategy is bound to cause grief; it is just bound to run off the rails. Not only do we have the penchant of Senator Alston to not even attend the Senate when we have a division, but we also have a situation where Senator Alston has proven during all three question times this week that he just does not have a detailed grasp of policy.But what has to happen now is that Senator Alston and the remainder of the coalition Senate leadership have to explain to the Prime Minister why they cannot deliver. Why can't the Senate proceed with this legislation now? Why has this legislation been delayed? Basically we have a situation where the Prime Minister, in my view, just adopts the NATO tactic, if you like—bomb the Senate, but don't commit the ground forces to come in here and debate the legislation.7E4VANSTONESenator Vanstone—That is appalling.5K4Faulkner, Sen JohnSenator FAULKNER—The Prime Minister needs to commit himself to sorting this out. I think we are entitled to an explanation as to why Senator Ian Campbell and others have not explained this situation.Honourable senators interjecting—10000PRESIDENTThe PRESIDENT—Order! There are far too many interjections. Senator Faulkner has the call.Honourable senators interjecting—10000PRESIDENTThe PRESIDENT—Order! I am trying to listen to Senator Faulkner. Senators not in their own seats shall not interject.XE4BOLKUSSenator Bolkus—You had better stop Senator Vanstone, then.AW5CARRSenator Carr—That is bolshie Mandy doing that, isn't it?10000PRESIDENTThe PRESIDENT—Order! Your leader is attempting to address the Senate.5K4Faulkner, Sen JohnSenator FAULKNER—We need to make it clear that the Labor Party has fulfilled its responsibilities in relation to this debate. We have constructively engaged in the committee, we have set out our case and we are ready, willing and able to commence the committee consideration of these bills now. The Labor Party stands ready to debate the detail of the GST right now. Let us look at the process that has led to this Costello induced legislative shambles that we have on our plate.10000PRESIDENTThe PRESIDENT—Mr Costello.5K4Faulkner, Sen JohnSenator FAULKNER—Mr Costello shambles. The four committees of inquiry were established on 25 November last year. Labor had proposed one select committee; the government rejected that and went for a four-committee model—three committees chaired by Labor senators and one by a Democrat. To expedite the process, the first committee met as early as 18 December last year. Labor senators properly participated in a very gruelling Senate committee process. On the legislation, the Labor Party has assisted expediting the passage of two of the tax reform bills—A New Tax System (Fringe Benefits Reporting) Bill 1998 and A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Bill 1998 —and they, because of the constructive approach of the opposition, were improved with opposition amendment and passed prior to the 1 April start-up date.We have been constructive. We are ready to deal with the committee stage of these bills and the government are not. I say to the government: join with the Labor Party, because you will get the numbers, and get the committee stage debate on now. The government themselves, in Senator Kemp's speech, circulated 128 amendments of their own to the bill. There is a question of timing here. We are facing a bit of an unreasonable legislative logjam in the Senate at the moment.What you have to ask is: where has the Treasurer been in all this? Have Senator Ian Campbell and Senator Alston kept the Treasurer and the Prime Minister in the loop? What is the position of the Treasurer in relation to the consideration of these bills that the Treasurer claims are amongst the most important the Commonwealth parliament has ever debated in its history? Mr Howard and Mr Costello have demanded that the Senate get on with the job; they have demanded that we deal with the GST legislation. Apparently now they are saying, `That doesn't matter; we will adjourn these bills, perhaps to Friday, perhaps to next week.' They demanded that we get on with it but now they are willing to adjourn it.The Senate was recalled for a two-week sitting period to deal with the GST legislation. And that is what we want to do. The government have simply made the decision, `We will avoid the debate. We are not going to stick with the views the Prime Minister has expressed so publicly for so long on this issue.' Remember what the Prime Minister went to the Tasmanian division of the Liberal Party and said on 6 November. Let me quote it for you:. . . we will use every legitimate means at our disposal to implement that tax plan with the minimum of delay . . . we intend to implement the policy that we took to the election with the greatest possible dispatch.What did he say on the Sunday program 18 days later? Let me quote him again:The great fear I have of an inquiry is that it will be used as a device to delay and obstruct and to frustrate the will of the Australian people expressed at the election.The greatest fear he has must be from people on his own team who are proposing now not to deal. The greatest fear must be his own team—they do not want to go ahead with the debate. What about the Prime Minister trumpeting in the House of Representatives on 18 February this year in answer to a dorothy dix question:I say again to those in the Senate who are delaying this taxation package, to those who would seek to defeat the verdict of the Australian people: listen.That is what the Prime Minister said. Why aren't the people on that side of the chamber listening? Why aren't they listening to their own Prime Minister? They are flagrantly disregarding the views of the Prime Minister, Mr Howard, and the views of the Treasurer, Mr Costello. According to your own Prime Minister, he obviously thinks that you are seeking to defeat what he claims is the verdict of the Australian people. We are entitled to ask the question in this chamber at this time: why is that the case? Why are you delaying a measure which the Prime Minister trumpets is so vital to Australia's economic welfare? Why are you, according to your own Prime Minister, delaying consideration of billions of dollars of personal income tax?I have to say, and I am sure my colleagues know this, Mr Costello has not been quiet on this matter either. Who could forget what he said on the John Laws program on 20 April—yesterday. What about the eye rolling from Mr Costello, the deep sighing theatrics we had on the John Laws program? This is what he said:The Senate's got a whole week this week . . . That is what Mr Costello said.AW5CARRSenator Carr—No-one told him.5K4Faulkner, Sen JohnSenator FAULKNER—No-one told Senator Campbell and Senator Alston. Mr Costello said:It's got a whole week next week . . . He went on:I think we should be trying to aim to get this debate on and the vote as quickly as possible. I don't even know why we have had to wait until now to have the vote.What about Mr Costello on 1 February this year? He said:Let's pass tax. Let's move on past reform of indirect tax and income tax and the welfare benefits and we can move on then to business tax and we can move on then to faster growth and more employment.Well, come on down Peter Costello. We are ready to debate your legislation, but your own government senators in this very chamber have put off the debate, probably until next week.Mr Costello and Mr Howard have had enough time to do the groundwork for this. They have had months to talk to the Independents and the minor parties so that they can have a few contingency plans and the odd sleazy deal sorted out. Why haven't the Manager of Government Business and the abysmal and abject failure of an Acting Leader of the Government in the Senate told Mr Costello and Mr Howard about this? Why have they embarrassed them so much? Why didn't they tell them the risk was that they would say, `You want us to debate it, Mr Howard and Mr Costello, but, sorry, we are going to move a motion to delay debate'? Why didn't the government in the Senate keep their own leadership in the loop? This is the final humiliation—the government proposing a motion not to debate the committee stage of the GST bills.Remember the agonising debate in December. Who can forget them organising the extra time for the Senate to sit? I think it was an extra three weeks. The Treasurer and the Democrats spent hours on the shape of the GST committee process. It was agonising. Who could ever forget it? You had so much time involved in that particular exercise so that you could assure everybody that the legislation would be considered by the Senate by 30 June. The bills have been brought back in plenty of time to allow the government to debate them.The buck and the GST legislation stop with the Prime Minister, Mr Howard, and the Treasurer, Mr Costello. There was all that hectoring and all that exhorting of the Senate by Mr Costello to get on with the job. John Howard and Peter Costello tonight stand exposed as hypocrites and incompetents. We have heard the Manager of Government Business blame the Democrats. It is the oldest political trick in the book. You move the motion yourself to adjourn the debate and you blame someone else. This is not the Democrats' legislation, it is the government's, and this is the government's motion to adjourn the debate on this legislation.I want to make it absolutely clear that the Labor Party will join with the government right now to bring on the debate on the GST in the Senate. We are ready to go—bring it on now. Don't anyone listen to all the weaselly, slimy, sleazy sell-out words of Senator Alston and government members in the Senate. If the government wish to proceed with these bills and if the government wish to have the committee stage of debate on these bills, they can. We, the opposition, will give them the numbers for this debate.The Democrats are being set up as fall guys for the government. I hope on this occasion that the Democrats are smart enough not to be the fall guys for the government's incompetence. Peter Costello is in charge of the legislation. He wanted extra time. We gave him extra time, and now he has squandered it. He has failed to do his job. He and his coalition Senate leadership have failed the Prime Minister.We do not know when the government plans to bring the committee stage on. At the moment we have a motion before the chair rearranging business so that these matters cannot be brought on until before Friday of this week. We heard, in the speech the Manager of Government Business made, that it might take longer. So we may in fact be aborting consideration of these bills until Tuesday of next week, possibly later for all the opposition know.What is absolutely clear to all opposition senators in this place—and what I believe will be clear to the Australian public—is that the government has brought this absolute farce upon itself. Bring John Howard back now; even he could not do any worse. Perhaps Mr Costello can play a bit of a role in this. Let us sort out Mr Costello's dog's breakfast—because that is what we are left with. What we say is: bring on the committee stage now. We have had enough of this farce and this nonsense from the government after the Senate and the opposition have been implored for so long to bring this debate not only on but to a conclusion. We are ready, willing and able to debate it now. It should be debated now and the government stands condemned for adjourning it.17:51:004061Lees, Sen MegSenator LEES8U4SAAD00—I was going to start by talking about some of the very strange comments Senator Ian Campbell made, but I find that Senator Faulkner has made such an extraordinary contribution that I must start there. I do not think anyone sitting in this place believed a word of it for a moment. But, unfortunately, today—as no doubt Senator Faulkner knows and probably why we had the performance in the first place—we are on broadcast, so for the benefit of those people out there I will reiterate where we are at in this debate. We are some seven hours ahead of where we should have been thanks to the deal that the opposition did with the government.AW5CARRSenator Carr—What deal?10000PRESIDENTThe PRESIDENT—Order! Senator Carr, stop shouting.8U4Lees, Sen MegSenator LEES—Why you are working with them, I do not know, when you have made it so clear that you have no interest in improving this package. You have no interest in supporting amendments that actually improve the GST package. You have made it very clear that you are going to vote down our amendments, the government amendments and presumably any Senator Harradine—Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—Order!8U4Lees, Sen MegSenator LEES—The Labor Party has made it very clear that they have no interest in these bills. They intend to vote down any constructive amendment in the interests of their own political beliefs, political interests, that the best thing that can happen is that we give the government—Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—Order!8U4Lees, Sen MegSenator LEES—In the hope that they can force us to vote this down in the short term so that there we have the start of a double dissolution trigger. Their game is political. It has nothing to do with trying to work through what is a very complex package of 27 bills. It is very easy for a party to be ready to debate a committee stage when they have circulated no amendments, when there is nothing prepared. I had understood that you did have amendments. I still have none in front of me. Senator Margetts's amendments are ready. But there is nothing from the Labor Party, so of course they are ready to debate.ZW4SHERRYSenator Sherry—Where are yours?8U4Lees, Sen MegSenator LEES—That is where I was going to begin, but after the extraordinary contribution from Senator Faulkner I wanted to answer some of those statements first. Let us look at the decision that was made to force us to sit right through Tuesday morning and then through Tuesday night—some seven hours of speeches on the second reading that should have been continuing now through tomorrow and into Friday. We had always intended to circulate our amendments on Friday and we will keep to that deadline. The only possible delay would have been a matter of an hour or two, brought about by the fact that we have one staffer working on the final amendments who is also required up until Friday to work on our committee report to have it tabled on Monday. The other amendments are in draft form, but those final amendments relating to the last committee report are now being drafted.I say this to Senator Campbell, knowing that you have no cooperation on this side: surely it would be in your own interests not to force the debate through, knowing how few staffing resources we have, in order to put us in a position where, unfortunately, we have to say to you that time simply does not allow us, given the tabling of the report on Monday and with one staffer working on our final amendments, to have them tabled in this place in sufficient time for you, Senator Harradine, Senator Margetts and Senator Brown to consider them. We know what the opposition are going to be doing with them, but all other senators need to consider them so that we can have a debate that does not take forever with amendments that people have had some chance to understand. I have to say at this point that, when we discussed with the government and indeed reached an agreement on how we would manage the sitting hours, we started off with 16 bills. We now have so many bills in the package that we have yet another report to write Friday week, particularly dealing with the wine bills—a very important industry that is not at all happy with what the government is doing. There, hopefully, we will see the Labor Party prepared to play a constructive role.As for the bills we are going to begin dealing with, Labor have not indicated at any stage that they are actually interested in doing anything in the committee besides standing up and making a lot of hot-air speeches. Labor have moved what I take it are their amendments to the second reading. But, even if those pious amendments had passed, they would have achieved nothing. They would not see us with any improvements to this country's tax system.A final message for Labor: if you do not want to be part of the committee stage, please let us get on with the job of doing the work we have to do in a reasonable time.Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—Labor senators will cease shouting.8U4Lees, Sen MegSenator LEES—And to the government I say: you have circulated 128 amendments today, and we also plan to consider those. We go back to the situation with our economics researcher who will again have that job to do.Senator Faulkner interjecting—8U4Lees, Sen MegSenator LEES—I know it does not bother you, Senator Faulkner, because I understand you are going to vote against them—please correct me if I am wrong. But we need to look through your amendments as well and to deal with those one by one as they merit. My final comment to Senator Campbell is that we are attempting to cooperate, but you are making it extremely difficult by working with the group that have no interest in cooperating.17:58:004062Margetts, Sen DeeSenator MARGETTSDX5WAG(WA)00—I guess what we have seen today is a certain amount of theatre. In the House of Representatives the opposition has put a number of substantive amendments to the tax package. I understand that they included a number of amendments in relation to transparency in pricing, on which our office have been talking about Labor advisers. That means whether or not people, when they are looking at the package or at the changes that have occurred as this policy changes, will be able to find out just what is the actual increase in the goods and services that they are purchasing.We are left in a position now where we still have not seen any amendments in relation to such things as transparency in pricing. I do not know, and I have not heard in anything Senator Faulkner has said, whether or not we will see from the Labor Party anything akin to the amendments that Labor moved in the House of Representatives. This means that there is some confusion. I guess we may ourselves have to draft amendments which we thought or assumed may have been moved by the ALP.The fact that this extra week was negotiated to give extra time for the ANTS package of bills to get through does not mean to say we will not get time to debate other bills. But the reality is we still have not seen from the government the total program they want to get through before the end of June. We have not seen from the opposition any interest in having a meeting to discuss the matter so that we know what the total program is that the government want to get through before the end of June.The reality is that if we go on with other bills we are still progressing the government's program—we have not lost time in the Senate if we go on with other bills. It is a nonsense for either side to suggest that if we go on with other bills that somehow or other we are not making progress in the program. We would like to see what the program is. What is it that the government want to get through by the end of June? It would be nice to understand what it is, the time allocated and how important the government see various bills, including the tax package.The reality is that this is a very complex package of bills, but unfortunately we have seen great emphasis on only the economic aspects of these bills. I call it the 40-minute club—the members of the Senate select committee who consider that the issues of the dollar economics are the real issues. Unfortunately that comes both from the opposition and the government—we have heard today that the opposition wanted the Senate select committee to look at only those aspects of the tax package. The Greens and many people in the community have said that the social issues—the issues of education, community groups and the arts, and the incredibly negative impact on the environment this tax package will force on Australia—ought to be given at least equal consideration with the things that are visible in terms of dollars.Unfortunately, the approach that has been taken here, with the opposition saying they are not going to participate in widening that debate, is going to potentially let the government off the hook on the wider social, economic and environmental issues and the issues to do with community. I am not entirely sure what the opposition's agenda is that they want to deal with it now, when their amendments—if there are any—on transparency and other issues have not been circulated. Are they never going to move the same amendments they moved in the House of Representatives?We have heard that there are 128 amendments from the government. I do think it reasonable that we get a chance to look at those. For proper committee process we ought to make sure that those people who are playing important roles in this debate have a chance to deal with this properly. Forcing a debate on any Senate when there are still uncirculated amendments—incomplete amendments for very good reasons—is stupidity. I have always said that it does not progress the debate at all.What we have seen here is theatre. We will not lose total time in this session if we go on with other bills. We will, however, still be left in the dark about what the government want to get through in this program. I suggest it would be in everybody's interest if at some stage in the next few days we have an agreement from all parties to have some kind of leaders' and whips' meeting so the govern ment can put on the table what it is they want to get through by the end of June—so that we do not continually have these farces and theatre in the Senate. If we know what we are being asked to deal with we can make consideration of the debating program and, when we do get to deal with the important committee stage, we can do it in a state of proper preparation.18:03:004063Ray, Sen RobertSenator ROBERT RAYUI4VICALP00—From this debate the first thing we can learn is that the sooner the war correspondent from Tirana returns to sort out the Democrats the better. The assertion from Senator Lees that because we are not moving a raft of amendments we have no contribution to make to the committee stage is an absolute nonsense. We will be looking at these bills clause by clause—in some cases raising questions or making points about it. So we will be making a contribution and we are ready to make that contribution now.H15CAMPBELLSenator Ian Campbell—We did that with native title in 1993. It's a great tactic.UI4Ray, Sen RobertSenator ROBERT RAY—That is right—absolutely. Senator Campbell has acknowledged that this is one of the legitimate tactics of the chamber, depending on your attitude to the totality of the bills. Senator Lees said we have done some sleazy deal with the government. I will tell you the deal we did with the government about speaking hours. It was very simple. We are here Monday, Tuesday, Wednesday, Thursday and Friday. Because we are all here on Tuesday morning and our relative party meetings are not meeting, the coalition said, `Why don't we sit then and use the time?' We said,`Yes, why not?' We will all be sitting around waiting for 2 o'clock to start, so why not absorb the three hours? Is it a sleazy deal to agree with the government on that? And then they said, `Look. We'd like to move the second readers along. As they are a matter of no division and no quorum, why don't we sit on Tuesday night and get another two or three hours?' We said, `Fair enough.' And there are plenty of examples where we have done this in the past, no matter what side of the chamber we have been sitting on. It is not a sleazy deal to move the debate along, and that is exactly what we did. So, in terms of the two major points Senator Lees directed at the Labor Party: firstly, we did not do any sleazy deal over time and, secondly, we do have a rigorous contribution to make in the committee stages of these bills, and we are looking forward to doing so.What position is the government in at the moment? It has moved that the debate be adjourned, and we know the reality is that it is really adjourning the debate until Tuesday morning. A motion may say Friday but everyone knows that it is still until Tuesday. The government says it is doing it in response because not all elements of the chamber are ready, but a good manager of government business would have found this out much earlier than Senator Campbell did. The political position we are facing is that the Prime Minister and the Treasurer are running around the talkback circuit playing the second oldest card in the book—blame the Senate. The oldest card in the book is the state premiers running around blaming whichever federal government is in power. That is the oldest card. But the second oldest is for executive government to blame the Senate.It was only yesterday that Mr Costello, that `Sydneycentric' minister, appeared on the John Laws program and demanded that the debate proceed this week and next week and be finalised by the end of next week. Doesn't Mr Costello talk to his Manager of Government Business in the Senate? Silly question—why would he?Senator Ian Campbell interjecting—UI4Ray, Sen RobertSenator ROBERT RAY—You're not actually in that portfolio area. Madam President, I think he was removed from that portfolio area after the last election. But we could at least expect Mr Costello to liaise with the Acting Leader of the Government in the Senate, Senator Alston. Surely they can get together in Sydney and have a conversation about the program as it is going to be into the future. Why couldn't they have got together?This is the dichotomy that we are most worried about: Mr Howard and Mr Costello running around the country demanding that the Senate get on with the job, and Senator Campbell and Senator Alston basically saying, `No, we will defer the debate until the following Tuesday.' You cannot have it both ways as a coalition. Why not bring it on for debate now? We are ready. You say you are ready, although we do not know. It may well be you are using the Democrats as the fall guys. Maybe you don't want to bring the debate on. Maybe you are still negotiating some other deals that none of us yet know about and you haven't consummated them yet. Maybe it is another Telstra bill. Remember how urgent the Telstra bill was—how urgent it was that we get to the second reading? That was weeks ago and it has not been brought back on. Why? Senator Alston has not been able to round up the usual suspects and do the usual deals which get sold out down the track. Maybe the same thing is happening with this matter.One thing Senator Margetts said was interesting. She wants to know where the forward program is. Don't we all? No-one knows what is on the agenda, no-one knows what the government ask is. A broad ambit claim is thrown out there. The manager should be able to say exactly what he wants to get through by 30 June or whether he intends to sit the Senate through into the first few weeks in July. We should at least know that at this stage. He is not being obtuse here, Senator Margetts. He does not know. He has not got a clue.LD4ALSTONSenator Alston—How do you know?UI4Ray, Sen RobertSenator ROBERT RAY—We know, otherwise he would come out and say so.Senator Alston interjecting—UI4Ray, Sen RobertSenator ROBERT RAY—Senator Alston says he is being deceptive! He is being not transparent! That is what Senator Alston is saying about his colleague. Senator Alston—always interjecting out of his seat. That is exactly what he is saying. That is very helpful; thank you, Senator Alston.But we do not know what the forward program is, which in many ways means that we have got no idea how much time we should allocate for the committee stage of these bills. If we knew what the eventual ask was, we could actually work our way back and know what was a reasonable time to take in the committee stage of these bills. But we do not know. We have got no idea whatsoever.DX5MARGETTSSenator Margetts—Then they will blame us for not being ready for the next bill.UI4Ray, Sen RobertSenator ROBERT RAY—Of course they will blame us. As I said, Senator Margetts, this is the blame game. This is the Prime Minister and the Treasurer running around the country blaming the Senate for everything, creating an artificial storm, saying we should change the voting system. We did not hear from any coalition members between 1983 and 1996 about curbing the powers of the Senate or rigging the voting system. All we heard was them extolling plurality. That is what they did.Senator Margetts interjecting—UI4Ray, Sen RobertSenator ROBERT RAY—But we actually never went to rig the voting system in the Senate, Senator Margetts—never once. If they had, I know I would have been the one they came to to devise the system, and they never did.What we are seeing here is the Senate being set up as the fall guy. That is fair enough as a political tactic. All executive governments do it; I acknowledge that. The point is: if you are going to do that, get your act together in this chamber. Don't have the Treasurer go out on a Tuesday morning and demand we debate this all week and have your Senate leadership pull the rug from under him at about 5.30 p.m. on the Wednesday and defer the vote.We assume that the government are deferring this vote because they are responding to the Democrats, but we do not know for sure. Given their rather tricky performances in the past about some of these matters, one could not be really sure whether this is the motive. But let's give them the benefit of the doubt in saying this is why they are doing it. They should have got the intelligence earlier that this was the situation. They should have told the Treasurer, `Don't make yourself look like the biggest boofhead in history by going on the John Laws program and demanding the matter be debated when, a day later, the Manager of Government Business in the Senate is going to sell you down the tubes.' The responsibility that the three senators sitting there have is to keep your leadership informed. The problem is: if you do not keep your leadership informed, next time there is a reshuffle just watch out. Your job is to keep the Prime Minister informed.Senator Heffernan interjecting—UI4Ray, Sen RobertSenator ROBERT RAY—You do not have to worry, Senator Heffernan; you will always be looked after.C16HEFFERNANSenator Heffernan—Is that a promise, Robert?UI4Ray, Sen RobertSenator ROBERT RAY—Any time we kick the Prime Minister in the behind, we know who gets concussion, Senator Heffernan. We have got no doubts about that whatsoever—none whatsoever. But these three gentlemen on the front bench need to keep the Prime Minister fully apprised of where this is going.What we do not expect over the next week—because this motion will probably be carried today—is the Prime Minister and the Treasurer re-entering the list and saying, `The Senate is not dealing with this.' I hope the leadership here at least have the decency to contact him in Western Australia today and say, `Look, for a variety of reasons we have had to put off the tax debate until next Tuesday. Just lay off the rhetoric a bit. Just lay off beating the Senate for a few days because we have had this bit of a blip that we should have told you about in advance. We regret we haven't told you about it until now, but please don't go on with the normal, moronic Senate-bashing exercise simply to shift the blame in politics.'18:13:004065Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—I do not want to detain the Senate for too long, but I think it is important to understand what the attitudes of the parties are on this issue. I noticed Senator Ray was being very generous in offering gratuitous advice to this side of the chamber. I am surprised that he has not really taken the opportunity to offer a lot more constructive advice to his own leader because if ever anyone blew it comprehensively, it is Senator Faulkner. What Senator Faulkner has essen tially said to the rest of the Senate is this: `Between us—Labor and the coalition—we have got the numbers. We don't care about anyone else. Screw `em.' That is the way the Labor Party operates; that is the way it works in the Trades Hall Council. But that is not the approach that we take in the Senate.We would like to get on with this debate as quickly as possible. We have made that abundantly clear. We have said it in spades right from the time of the last election. Nothing would please us more than to have this debate out of the road. We do not for a moment expect a skerrick of cooperation from the other side of the chamber. We understand your agenda. You will be here to frustrate for as long as possible. You have no constructive amendments to make; you are simply going through the motions of delay.We understand all that, but what is important is that there are some people who actually have amendments. We might say that they are misguided and wrong-headed. They might want to take out food and we do not like it, but at least they have got a few policy approaches, and the process of this place allows those to be properly debated and considered.3L6CONROYSenator Conroy—You described them as fruitcakes.LD4Alston, Sen RichardSenator ALSTON—Indeed, and that will be reflected in the attitude we take when they put up their amendments. But we do not deny them the right to put their amendments on the table. But that is the very thing that Senator Faulkner wants. He wants to deny them the opportunity to put their amendments on the table. He does not want to have a running sheet; he just wants pure chaos. That is what your leader wants. He wants to fundamentally disrupt the processes of the Senate so that it is absolutely chaotic. At the end of the day, much and all as we are disappointed that the Democrats have not been able to use the time between the last election and now to come up with all of their amendments, we do give them the benefit of the doubt in the sense that we know they do not have the resources of the trade union movement behind them and they therefore have to do a fair amount of the work themselves.3L6CONROYSenator Conroy—The hoary old chestnut.LD4Alston, Sen RichardSenator ALSTON—Come in spinner! It hurts, doesn't it? That is a very painful nerve. The trouble with that issue is that it will never go away. You can bury your heads in the sand, you can deny it, you can say it is not so, but when everyone looks at the background of the people on the other side of the chamber they know that overwhelmingly they are the lackeys of the trade union movement. It is within your control or the control of the preselectors. I simply say it.Just to be clear, we have had over 14 hours of the second reading. In terms of speeches on the second reading, this is in the top half-dozen of second reading debates ever in this chamber. We have had a very substantial period of time. We are dead keen to get on with it, but we are prepared to give the Democrats an opportunity to ensure that the process of the Senate operates effectively. The only thing we regret, but we are not surprised about, is that Labor has no interest at all in pursuing that agenda.18:17:004066Carr, Sen KimSenator CARRAW5VICALP00—We just heard from the Acting Leader of the Government in the Senate. He has spoken for three minutes. You would have thought that with all his experience in this parliament he would have had a bit more to say than could be said in three minutes. What a miserable, mealy-mouthed performance that was that came from Senator Alston, the great champion of the lawyers' party in this parliament. What we have heard from him is gratuitous advice to the opposition. We have heard from him gratuitous advice to the Democrats.Nothing could be more insincere than the proposition he has put before us today, because at core here we have the major problem with the government's legislation, a program which they have trumpeted up and down this country. Up and down this country they have said, `This is the most important legislation this country has ever seen.' We have been told that this is legislation that is immutable. That is the proposition that has been put to the people of this country. And now we are told that there needs to be more time to consider the amendments of the Democrats—amendments which you have already declared that you intend to vote against and have already declared that you have no interest in. You have no interest in considering these issues.The critical issue here about all of this is that you really need more time to get your deal together. The critical question that has to be attended to is that you have yet to organise the deal to put this package through the parliament. We say, of course, that this package is wrong. We say that a majority of Australians do not accept this package, that a majority of Australians understand just how wrong this package is and they demonstrated that at the last election. But you claim to have a mandate, you claim that this is the most important legislation this country has ever seen and you claim that this legislation is immutable. Yet you come in here with this mealy-mouthed nonsense that you want to provide more time for the Democrats to prepare amendments which you will vote against. What we have seen is a major U-turn by the government on this question.I am perhaps a bit different from some of my colleagues in my perception of Senator Ian Campbell's role in this. I do understand the problem he faces. I do appreciate the difficulty he faces. Quite frankly, he is dealing with incompetents beside him in Senator Kemp and Senator Alston. He is dealing with fundamental incompetents. They do not bother telling him what is going on, and he is the one who has to come in here and find excuses for the incompetence of this government. We were told by Mr Costello only yesterday that the Senate should get on with the job, that he cannot understand why we need to wait another week, that this vote should be taken straightaway. Yet Senator Campbell is the unfortunate one who has to get up here and explain why this miserable, mealy-mouthed approach is being taken. Quite clearly he is at a loss to do so. I can understand just how weak his performance is, because what else could he do after so much has been made of this legislation by so many in this government with so little to show for it?This parliament, we are told, has been considering this matter for 14 hours. We are told that there have been huge amounts of time spent in the committees of the parlia ment, a select committee and three standing committees. We have been told that all this needs to be considered in two additional weeks of sitting. Yet we are told here at 5 o'clock tonight that we have to adjourn the consideration of this matter. After the consideration of a number of amendments which we have already put, a number of principal matters that we have already put, we are told that these matters cannot be discussed any more today. This is only after yesterday when we heard from Senator McGauran, who got a big run on the ABC news last night saying that this was a matter that the government was prepared to fight a double dissolution on.UI4RAYSenator Robert Ray—Who said that?AW5Carr, Sen KimSenator CARR—Senator McGauran said it. He was only too happy to present this as being of fundamental importance to the government. Yet what do we hear from the government today? We have to adjourn. In a breathtaking act of hypocrisy, what you are trying to do is provide more time to stitch up your arrangements.What we have demonstrated again is that the government seeks to blame the Democrats, and they are very easy to blame. You are only too happy to blame the Democrats when you get into trouble, and they fall into the trap every time of allowing you to blame them. One can understand why you used to call them the fairies at the bottom of the garden, the fruitcakes and the various other descriptions you have put on them. Unfortunately, I think their performance today does confirm some of those opinions that you have had of them.We have been told that we have stitched up some deal with the government in regard to the proceedings in the bill. Nothing could be further from the truth. What we saw today from the Democrats was that they were the ones that voted with the government. It was the Democrats that voted with the government in terms of passing the second reading of the bills.We had 14 principal amendments moved by the opposition—14 of them. What did the government do? They voted against them all—blanket opposition, as you would expect. What did the Democrats do? On issues such as this proposal being an unfair tax that would see more than 50 per cent of benefits going to the top 20 per cent of income earners, and of it being a tax to benefit higher income earners which would far outweigh increases in social security benefits for low income earners—proposals which would see the creation of a situation where people with no children and earnings of $100,000 per year would get five times the benefit proposed for low income earners—what do the Democrats do? They abstain. What great principle; what a show of strength that was; what an extraordinary commitment to social justice was demonstrated by their abstention today!On the issue of protecting retirees, what did the Democrats do? They abstained. On the question of defending Australian consumers and exposing the real impact of the tax on prices rises, the Democrats abstained. On the issue of defending small businesses, what did the Democrats do? They abstained. So I do not think it is appropriate for them to suggest that they are the persons of high principle and that they are the only ones that have an interest in social justice and equity issues.What we have heard from Senator Alston, however, means that the government has once again demonstrated its hypocrisy. We heard only yesterday from the Prime Minister—and it has been contradicted by Senator Alston, I might suggest, in his actions today—`I have said all along that we are not going to alter the essential thrust of the plan. What I will happily do is finetune at the margins but I am not going to alter the essentials.' Senator Alston would have us believe that there is going to be some consideration of the measures being presented by the Democrats. I suggest to you that nothing could be further from the truth.We saw Senator Alston in the Telstra debate, where he suggested that Senator Faulkner had acted in a way which was inappropriate and had indicated that, once you have the numbers, you just use them. Senator Faulkner did not say that. On the contrary, what we have seen in the Telstra discussion in this parliament is that Senator Alston has behaved in that way, quite clearly gagging the debate on Telstra and quite clearly using Senator Colston in the most unprincipled of ways to secure the partial privatisation of Telstra itself.I say to the Senate that this proposal is not about a proper consideration of the legislative program and it is not about an orderly scheduling of debate; it is about providing the government with more time to stitch up its deal to get this inequitable tax through—which of course will do great harm to this country.10000PRESIDENTThe PRESIDENT—The question is that the motion moved by Senator Ian Campbell be agreed to.18:30:00The Senate divided. (The President—Senator the Hon. Margaret Reid)43Abetz, E. Allison, L.Alston, R. K. R. Bartlett, A. J. J.Boswell, R. L. D. Bourne, V.Brown, B. Brownhill, D. G. C.Calvert, P. H. Campbell, I. G.Chapman, H. G. P. Colston, M. A.Coonan, H.* Crane, W.Eggleston, A. Ferguson, A. B.Ferris, J. Gibson, B. F.Harradine, B. Heffernan, W.Herron, J. Kemp, R.Knowles, S. C. Lees, M. H.Macdonald, I. Macdonald, S.MacGibbon, D. J. Margetts, D.McGauran, J. J. J. Minchin, N. H.Murray, A. O'Chee, W. G.Parer, W. R. Patterson, K. C. L.Payne, M. A.Reid, M. E.Synon, K. M. Tambling, G. E. J.Tierney, J. Troeth, J.Vanstone, A. E. Watson, J. O. W.Woodley, J.23Bishop, T. M. Bolkus, N.Campbell, G. Carr, K.Conroy, S. Cook, P. F. S.Cooney, B. Crossin, P. M.Crowley, R. A. Denman, K. J.Evans, C. V. Faulkner, J. P.Forshaw, M. G. Gibbs, B.Hogg, J. Lundy, K.Mackay, S. Murphy, S. M.O'Brien, K. W. K.* Ray, R. F.Reynolds, M. Sherry, N.West, S. M.Hill, R. M. Hutchins, S.Newman, J. M. Collins, J. M. A.Ellison, C. McKiernan, J. P.Stott Despoja, N. Schacht, C. C.* denotes tellerQuestion resolved in the affirmative.Bills4069r7224069Debate resumed from 22 March, on motion by Senator Newman:That this bill be now read a second time.18:33:004069Sherry, Sen NickSenator SHERRYZW4TASALP00—The Taxation Laws Amendment (Software Depreciation) Bill 1999 proposes to implement changes to the recognition of software expenses for businesses as announced by the government in the 1998-99 budget and modified by subsequent announcements.Before I go to further comments, I point out to the Senate that this matter has been brought on very quickly and very unexpectedly, I might say. It is a mark of the cooperation of the Labor opposition in attempting to facilitate the government's program, particularly when, as we have just seen, we should be dealing with the GST package. That is what we are here to debate. We have had time set aside, specifically these two weeks, and we have cooperated in extending time in order to debate the government's GST package, but it has just been pulled. We should be going into committee to deal with that very important—one of the few points we would agree with the government on—package of bills. So the Labor opposition is being remarkably cooperative with the government in attempting to facilitate its program.I can only reflect on the comments of Senator Ian Campbell, the Manager of Government Business, who castigated the Labor opposition a few weeks ago with respect to the second reading debate on the Telstra bills. What happened when we got to the end of the second reading debate on the Telstra bills? The government pulled the bills. Likewise, what has happened when we want to get on with the GST legislation and consider that? The government pulls the bills, despite being here quite specifically to deal with the issues relating to the GST package.I do not want to be too harsh on the government manager, Senator Campbell. We all know that Senator Heffernan is eyeing his job and that he is ready to take over. He is being trained because of the incompetence of Senator Campbell. We cannot just blame Senator Campbell of course. We have had a shambles today with the Acting Leader of the Government, Senator Alston, in the conduct of the Senate, not just with the GST bills being pulled.For example, we had two government senators who were out to lunch early and missed the vote, so we had to recommit a vote on that GST legislation. Of course Senator Alston did not complain about that, because I can recall a couple of occasions when he himself has missed a couple of vital votes in recent times. And he is the Acting Leader of the Government in the Senate. I do not know what role Senator Kemp is taking in all of this. He is the Assistant Treasurer. We have very important legislation that we should be considering with respect to the GST package. I simply do not know what Senator Kemp is doing to assist in managing the government's program and attempting to get this vital legislation through.The Labor Party is supporting the Taxation Laws Amendment (Software Depreciation) Bill 1999 . We have one very important amendment. I think this highlights yet again the positive approach that the Labor Party takes to genuine tax reform that is for the benefit of the whole community in Australia. That is one of the reasons we will be supporting this legislation.The changes we are considering in this legislation fall into three broad categories: first, expenses associated with developing year 2000 compliance systems; second, minor or redundant software expenses; and, third, a new consistent regime for non-minor software expenses. The first category relates to expenses associated with becoming year 2000 compliant. This bill will allow for an immediate deduction for expenditure in relation to new software or for substantially rebuilding current software to ensure Y2K compliance for an existing computer system. In relation to year 2000 compliance expenses, the taxation commissioner has ruled that expenditure incurred in initial work on computer software to determine the extent to which it is not Y2K compliant will be on revenue account, even if no further work is necessary.Further expenditure incurred in modifying and testing computer software to make it Y2K complaint will be on revenue account, even if it also provides minor software improvements. Where expenditure incurred in modifying and subsequently testing computer software also involves substantial improvements not related to making the software Y2K compliant, it will be necessary to apportion the expenditure between the expenditure related to Y2K compliance which will be immediately deductible and the improvement expenditure which will be deductible over time.However, Y2K compliant expenditure that involves replacement of the whole or substantially the whole of the unit of hardware equipment contained in a computer chip or firmware is of a capital nature. The government accepts the commissioner's ruling, but it is proposing to legislate to broaden the expenditures immediately deductible to also include expenditure on acquiring new software including upgrades, or substantially rebuilding current software which has the predominant nature of ensuring Y2K compliance, provided that it is incurred up to 31 December 1999.The proposal to encourage Australian business to become Y2K compliant is sensible and it should be supported. There appears to the Labor opposition, however, to be a gap in these proposals. According to the proposed section 46(75), there is no scope for immediate deductibility of expenditure incurred after 1 January 2000. That expenditure therefore falls for consideration under the proposed new general rules and would generally be written off over 2½ years. What the government is endeavouring to do with this bill is provide an immediate deduction for expenditure concerning new software where the purpose of the software is Y2K compliant and that capacity for immediate deduction will expire on 31 December 1999.To Labor, this seems to be too short a timeframe because it seems entirely possible that problems which may emerge may not do so until that magical date of 1 January 2000—midnight—and that, if you do get problems of a Y2K kind emerging on 1 January, these problems would need to be fixed immediately. We think the general regime for deductibility may not be adequate and that the provision for immediate deductibility would be the better way to go.The government's proposed treatment seems odd to us because expenses related to developing software to overcome the millennium bug incurred after 1 January 2000 would presumably be urgent. Labor believes that we should be encouraging business to remedy any problems and that we should give them an immediate deduction for remedial millennium bug expenses until at least 30 June next year. We think it would be more appropriate that there be an additional period of six months for businesses to get an immediate deduction for measures that they have to take to correct this problem.To the extent that these costs have been factored into the government's estimates of the general software depreciation provisions, there would be savings against the forward estimates as Labor's amendment simply brings forward expenses that would be claimed later. We will be supporting this measure with an amendment, which we will move in the committee stage, to allow an immediate deduction for the year 2000 expenses incurred up to 30 June 2000.The second item in this bill concerns minor redundant software expenses. All items of plant and equipment—for example, non-software valued at under $300—are allowed to be fully deductible in the year of acquisition. The rationale is that it is not worth depreciating the minor asset over its useful life where its value is so low. Software will now be treated in the same manner as other minor assets but bulk purchases of software packages summing to more than $300 but individually valued at up to $300 will be covered by the new depreciation provisions.The bulk purchase rule could be easily avoided by purchasing the same software under different invoice numbers or at different times. Therefore, the legislation includes a multiple purchase rule so that an immediate write-off of expenditure is available only where the total expenditure on identical software in an income year is $300 or less. This measure will be supported.The third item in the legislation concerns a new depreciation regime for software. On 11 May 1998, the Commissioner of Taxation withdrew taxation ruling IT26 which deals with the taxation treatment of software expenditure. The commissioner concluded that IT26 no longer reflects the correct application of the existing law in relation to software.Without a legislative response, the withdrawal of IT26 would mean that systems and application software would generally not be subject to deduction or at best would be depreciated over 25 years. The government therefore announced an intention to legislate with effect from 10 a.m. Australian eastern standard time on 11 May 1998 the timed withdrawal of IT26 to provide for systems and application software to be depreciated at 40 per cent per year, that is to say that it will be fully depreciated over 2½ years.The new arrangements are proposed to apply to expenditure incurred in relation to contracts entered into to acquire software after the withdrawal of IT26. It will also apply to expenditures on specified commissioned and in-house development of software commenced after that time.Expenditures on in-house development or commissioned software commenced or contracts entered into up to that time will continue to receive the previous treatment until 30 June next year. Therefore, any such expenditures will be treated under the new provisions. These new provisions are as follows. All software purchases will be eligible for taxation amortisation over 2½ years at 40 per cent per year. That is the general regime that will apply. The software is to be depreciated over that 2½-year period at 40 per cent per year. However, there will be exemptions. If the non-renewable licence period is shorter than 2½ years, then taxpayers will be allowed to amortise their expenditure over this shorter period. Taxpayers who stop using software within the 2½ years of acquisition will be allowed an immediate deduction of the unrecouped expenditure at that time.Software purchases up to $300 will be immediately expensed, as I indicated in discussing item 2. The cost of commissioning software or developing it in-house for their own use will be capitalised—that is, it will not be deductible until the project is completed, at which point it may be amortised in line with the new provisions, ensuring neutrality with purchased software. But should the commissioned or developed software be disbanded, capitalised costs will be deductible at that time. Finally, the treatment of upgrades and maintenance will be in line with the existing application of the law for determining capital and revenue expenses.Broadly, expenditure on enhancing or upgrading the functional capacity of computer software should be treated on capital account. Expenditure that does not enhance functionality—such as maintenance, testing, code reviews, minor alterations, modifications and remedying defects—should continue to be treated on the revenue account. Moreover, systems software that has previously been written off as part of the computer hardware over 3.7 years under accelerated depreciation will not be amortised over 2½ years. The treatment of software that attracts concessions under other provisions remains unchanged. There should be advantages through reduced compliance costs of allowing expenditure incurred on software developed in-house to be written off from the year after it is incurred rather than being written off over 2½ years from the time each project is completed.There will be special rules available for those who develop software. These taxpayers will be able to make a once-only election to pool that expenditure. Once that election has been made, all expenditure incurred in devel oping software in an income year is to be pooled or written off at 40 per cent in the following two years and 20 per cent in the third year. There will be a transitional arrangement whereby taxpayers who elect to pool for the first income year after 11 May 1998 will be able to elect out of the pooling method in the second income year after 11 May 1998.The government claims the write-off rate of 2½ years strikes an appropriate balance between considerations that software is an essentially capital expenditure which should be amortised for taxation purposes and the relatively short expected life of software arising from rapid developments in the IT industry. This does not seem to Labor to be a reasonable line of argument, but software these days does have a relatively short expected life. Labor also notes that this is a reasonable treatment in terms of overseas comparisons and international arrangements. Indeed, the proposed arrangements for software are broadly more generous than those applying in comparable overseas jurisdictions. For example, New Zealand allows software purchases to be depreciated at 30 per cent straight line or 40 per cent diminishing value. That is the equivalent to 3.3 years. The UK provides depreciation at 25 per cent diminishing value, equivalent to a six-year write-off. In Canada, software receives either a five-year or eight-year write-off period depending on the industry it is used in, while applications software is depreciated at 100 per cent, which effectively results in a two-year write-off period due to Canada's half-year rule. The United States provides a three-year write-off for newly purchased software unless the taxpayer can show that a shorter write-off is appropriate.This measure is necessary to ensure that Australian businesses are not disadvantaged by the new ruling by the Commissioner of Taxation. Software expenditure is a significant and increasing expense of business and must have a reasonable taxation regime to ensure that Australian firms remain internationally competitive. As I indicated before, Labor will support the proposal subject to the amendment that we propose to move in the commit tee stage, allowing the immediate deduction to be incurred up to 30 June 2000.When we are talking about taxation arrangements for business, I suppose it is worth referring briefly to the fact that we have recently seen the second discussion of the Ralph Review of Business Taxation. From Labor's point of view, as a matter of process, this is really the way that taxation reform ought to be undertaken, at least in its consideration, with the release of detailed options for public discussion before government makes a final decision. It certainly makes a stark contrast with the way the government has handled the GST package, and mishandled it in the Senate here today—simply dumping the GST package on people just before an election in a deliberate attempt to hide the detail under cover of a $20 million taxpayer funded, essentially party political, advertising campaign.The Ralph team has produced a very lengthy and very detailed document. It deserves a considered response, and we certainly will not be rushing to judgment in relation to it. Labor agrees with the need for business tax reform, as indeed Labor agrees with the general argument for tax reform without a GST. We are prepared to give support with respect to business tax reform to those measures that come from that review where it can be demonstrated that those changes will improve investment, productivity and growth—adding jobs and strengthening industries rather than the reverse, as will be the case with a GST.We will not, however, support in this exercise some kind of reduction of business taxation at the expense of individuals and families or anything which looks like simply dipping into the budget surplus. This exercise should not be about giving tax cuts to business while this government is on about imposing a 10 per cent GST on individuals and families. Labor certainly intends to hold the government to its promise that the business tax package will be revenue neutral.As I said earlier, we should have been debating the GST package here. We have had somewhat of a shambles due to the incompetence of the government's handling of the package of legislation. We stood ready tonight to debate the government's GST package in some detail through until next week in the committee stage, but unfortunately it has been deferred. For those listening, the Prime Minister, Mr Howard, and the Treasurer, Mr Costello, have been roaming the country saying, `Labor should get on with it in the Senate; pass our package, get on with it,' and when we are ready to get on with considering the legislation what happens? What has happened has been due to a combination of factors. Senator Hill, the Leader of the Government in the Senate, is away and we have the incompetent Senator Alston in his place leading the team—such as that team is. Senator Ian Campbell is part of the team as is Senator Kemp—the minister who cannot answer a question and pads it out with ums and ahs instead—who is going to be handling the important tax legislation in the Senate.H15CAMPBELLSenator Ian Campbell—If we ever get to be asked a question.ZW4Sherry, Sen NickSenator SHERRY—Just quieten down, Senator Campbell. Here we are, cooperating tonight, dealing with legislation brought on at very short notice, doing our best to get the government's program passed, despite the shambles that we saw earlier this evening when you could not proceed with your own legislation. I just hope this is not an indication of how this legislation is going to be dealt with, Senator Campbell. We are here ready to support it.To conclude, I have grave concerns for the future of small business under a GST, particularly with the problems associated with Y2K compliance. It is an unfortunate coincidence that, if the GST comes in, it will be coming in a short time after midnight of the year 2000. (Time expired)18:53:004073Murray, Sen AndrewSenator MURRAY3M6WAAD00—The Taxation Laws Amendment (Software Depreciation) Bill 1999 puts forward two significant proposals. This is one of those bills which dare not be delayed because it relates to the significant tick over of the 20th century. The first proposal is the requirement to depreciate computer software over 2½ years. Until May 1998, as a general rule software costs were deductible in the year in which the expenditure was made, in accordance with Taxation Ruling IT26. In May 1998, the Taxation Commissioner, Mr Carmody, that expert on gingerbread men, decided that computer software should no longer be regarded as a revenue expense and consequently it should not necessarily be immediately deductible, and IT26 was withdrawn.For what it is worth, and with respect to Mr Carmody from the tax office, we agree that computer software should not necessarily be immediately deductible. We believe that computer software is a capital asset and expenditure on that asset should logically be written down over a number of years, consistently with the treatment of other capital assets—when, of course, it is of significant cost. If it is not of significant cost then it makes no sense to proceed on that basis. We note, with approval, that software purchases of $300 or less will continue to be deductible in the year of expenditure.Before I move on to the second proposal, I would like to comment on the withdrawal of income tax ruling IT26. Whilst we agree that the substance of that ruling—that is, that computer software expenditure be deductible in the first year—was inconsistent with the treatment of other assets, we are concerned that when the ruling was withdrawn software costs fell into a tax black hole in this regard. This was commented upon in the Australian Financial Review a couple of days after the withdrawal of the ruling. Appearing in the AFR on such a matter within such short notice of the change of that ruling is a sure sign that it has got up somebody's nose. That type of uncertainty and that type of interregnum between tax events can only adversely affect business. It is uncertainty which is entirely avoidable. It only requires communication and cooperation between the government, the tax office and the professionals in the tax business world.The second proposal contained in this bill relates to expenditure incurred to cure the year 2000 problem—known everywhere now as the Y2K problem. The Y2K problem can potentially affect computer systems worldwide. Sometimes I get the feeling we are facing those kinds of `end of the world is nigh' cartoons, and nobody is quite sure whether this Y2K thing will turn out to be an interstellar explosion or a relatively expensive and short firework bang. But I agree with the government and I agree with the commentators that you dare not take the risk. It is for that reason that people are spending billions worldwide to address this problem.It is proposed that expenditure on software incurred before 1 January 2000 will be deductible if the principal purpose of the expenditure is to ensure that an existing computer system attains year 2000 compliance. Obviously the tax office is not going to be able to run around and ask everybody if that is true. It will be a declaration of trust, I guess, by those who put in their tax returns. But that is typical of our entire system. Our tax returns are submitted on a trust basis.This concession no doubt comes as a relief to business, which was facing the prospect of having to depreciate this expenditure on the basis of a draft ruling the Commissioner for Taxation had in respect of expenditure on year 2000 compliance. That draft ruling stated that expenditure on acquiring new software or substantially rebuilding current software would not be immediately deductible because it was capital in nature. The Australian Democrats support this measure and take the view that business should be encouraged by government to undertake preventative measures like this one by the granting of these types of event-specific taxation concessions.Another significant event which may potentially be facing this country in the year 2000, and one which is possibly as significant as the year 2000 problem in terms of its cost, is the imposition of a new tax system. I would like to comment briefly on the potential for computers and computer software to significantly ease the burden of compliance with the GST event, should that event in fact occur, and for the possibility that the government may provide concessional tax treatment for expenditure, the principal purpose of which is to ensure that existing computer and accounting systems are GST compliant.The use of computing systems would without doubt be one of the best means of minimising the costs arising from needing to account for GST paid on inputs and having to claim those credits against GST payable to the tax office on goods sold. It is our view that the government should seriously consider the use of tax concessions like this one to encourage business to be fully prepared for this new tax system, just as it will hopefully be for the year 2000 problem.The government's regulatory impact statement says that the imposition of a GST will cost a minimum of $1.9 billion to business. Frankly, that is a cost which otherwise they would not have to incur, and it is our belief that the government should review favourably tax concessions to deal with that very significant tax event which business will experience. The Australian Democrats believe that the government needs to use tax policy as a flexible device to assist business and that it should not shy away from event-specific taxation in that regard.In respect of the government's amendments to the bill, which have been circulated in advance, we will be supporting them. I foreshadow that the Australian Democrats will not be supporting the Labor Party amendment. The reason is that we believe the focus must be on preventive measures to address the year 2000 problems before they occur. This will not deny a deductibility to any subsequent expenditure; it will simply mean that it will not get concessional treatment and will not necessarily be fully deductible in the year of expenditure.This kind of bill, this kind of proactive activity by the government with regard to tax concessions to deal with issues which are not the consequence of normal business activity, has to be welcomed. I think the government has behaved properly with regard to this particular issue and, as a result of this particular concession, will minimise potential problems which could exist in our business world, and indeed in the non-business world—in the charity sectors and in the Senate, and for anyone else who has computer systems—where the year 2000 problem might result in major problems.I want to move on from these remarks to more general fears that I have in terms of a coalition of events which may prove unmanageable for business. The first, as we know, is the year 2000 event. The assumption in the community at large is that, come the first week of January, everybody will breathe a sigh of relief—the planes are still flying, you can still draw your money out of the ATM, you can still go to the supermarket and use EFTPOS and you are safe. However, it is possible that year 2000 problems will continue in the months thereafter. For any business systems which do crash, those consequences could be pretty catastrophic and could continue for some months and result in a great deal of angst for those concerned.To that potential event, we add the second potential event—the introduction of the new tax system proposals, particularly the GST, but also a number of other events. They are due to occur on 1 July 2000. So that is the second major issue that businesses have to face: having got through the year 2000 problem, they will then have to make sure their accounting software and indeed their systems—and for many small businesses it will require the acquisition of hardware—are ready for the GST. It is not as if they have a great deal of time to do that, because the ACCC is going to be pretty hot on their tails in the first month of July to make sure they are pricing their goods appropriately—taking off wholesale sales tax and putting on the goods and services tax.But hanging over all of this is the Ralph Review of Business Taxation. It seems possible to me, given the way the government operates—and maybe this is so and maybe it is not—that when the Ralph review is completed the government will examine the recommendations and will produce legislation as a consequence for us to deal with later this year. It is possible that the Ralph review reforms or changes will be geared to be introduced also on 1 July 2000 because it is the nature of tax legislation that the government does indeed try, as far as possible, to use financial year dates to kick in new tax legislation or new tax provisions. If you do that, and we have the year 2000, the GST and the possible Ralph tax changes, we are going to have a lot of angry tax professionals and business people.H15CAMPBELLSenator Ian Campbell—They might be happy because they will be so busy.3M6Murray, Sen AndrewSenator MURRAY—Yes, some of them will be happy, and some will be making a lot of money. But the fact is that, with regard to these issues, we have to be aware of the kind of stress which may attend all these changes at once to business systems and to the business community at large. If the government decides to pursue that course of action, and it may—you cannot do anything about the two events I have discussed already—it is then incumbent upon the government to consider maximising the tax concessions which will allow people to lay off the costs which would arise from tax event-specific activity.This bill does not do that; it deals with the year 2000 problem and some other general policy approaches on the tax side. But if the government is in fact to continue a good policy approach here of being proactive in this area, then it may well need to start to think about that. It would be better, quite frankly, if that was known earlier rather than later, so that people buying hardware and software can maximise the benefit of the investment with a view to perhaps having to change their systems and so on.Those I think are the simple things, like the discussions about how depreciation will be treated in future. As you know, most major organisations have assets registers. The assets registers are recorded in software packages. They are very much a part of the business systems. The assets registered are all computed in terms of the year of write-off. If the government decides to change depreciation allowances and when things will happen, then you have to change those software packages and systems.Similarly, the capital gains discussion is very much in the news. If the government decides to put up legislation which, for instance, had a sliding scale in terms of capital gains, or if it alters the capital gains percentages or the time in which capital gains events took place, again systems will be affected. The software that is available is affected, particularly in major organisations. You can imagine what a place like Lend Lease, to give an example of a giant company with extensive investments in property, assets and equipment, would have to do with their systems and their software if you fiddled with depreciation and capital gains.ZW4SHERRYSenator Sherry—It's the big bang.3M6Murray, Sen AndrewSenator MURRAY—Yes, it is a big systems bang, if you like. What I am trying to encourage you to do in this important first step that you are putting forward is to think forward so that, if the government does decide to introduce tax changes in those areas, you provide well in advance tax facility for write-offs and favourable treatment of good investment in modern technology which can cope with the potential of all those changes. I am no computer expert, but I am very certain that that kind of tax coalition—tax big bang, as Senator Sherry expresses it—would require some kind of special treatment.With that general admonition about some fears of what the year 2000 may bring to the systems engineers, tax accountants, tax professionals, financial directors and systems managers, I close by repeating that the Australian Democrats support this bill and will support the government's amendments.19:10:004076Lundy, Sen KateSenator LUNDY7G6ACTALP00—The Taxation Laws Amendment (Software Depreciation) Bill 1999 proposes to recognise the software expenses incurred by businesses seeking to remedy their year 2000 problem. There is currently quite a high level of confusion in the community about what Y2K actually means and what is involved in becoming compliant. Despite much of the publicity surrounding the year 2000 problem, it is not about the year per se. As we have reiterated in this chamber many times, the real problem is how computers have been programmed to read dates. Unfortunately, there is no universal law or ruling governing how we deal with the Y2K problem, so we have a rather ad hoc approach that by and large leaves the fixing of the problem to individual companies and governments seeking to take a socially and economically responsible position with respect to this issue.We find ourselves a mere 250-odd days away from the year 2000 and in a situation where some countries have done virtually nothing with respect to becoming compliant while others are inching closer to preparedness as each day passes. Australia is in a comparatively better position than most other countries. I am ever hopeful that the effects of non-compliance, which will no doubt be felt throughout next year, will be manageable. However, any disruptions or glitches or whatever will occur could possibly have been lessened had the problem been recognised and acted upon earlier, particularly with reference to the role that the federal government have taken in their somewhat tardy response to the Y2K issue.There is a great opportunity for leadership on this issue and we stand generally in a strong position within the Asia-Pacific region. In turn, this places a great deal of responsibility on this country. This bill represents another piece in the jigsaw puzzle that not only goes towards raising awareness in the community about Y2K but also puts in place a practical mechanism to encourage remediation work. We saw not so long ago the passage of the so-called `good Samaritan' legislation through this place which in its way encourages the sharing of information about methods of remediation and preparing for the Y2K problem by using a mechanism of allowing more open communication and sharing of information about strategies and methodologies to enable companies to become prepared.This is the real challenge that presents itself to this government—this overall approach to preparedness. Just recently we saw the release of information by the government relating to their own levels of preparedness, which I will comment on a little later on. I presume that, in the near future, we will see some sort of public education and awareness campaign in relation to this matter to continue the work that has begun in the private sector of raising business and corporate awareness right across the board, to extend the same courtesy or service to the citizens of the country as opposed to our corporate and business sector only. What we are really looking for, as we have with the coalition government through so many issues, is some decisive action. As I said, I am hopeful that this piece of legislation will also contribute to that jigsaw puzzle of providing a framework to allow the Australian community to be in the best possible position come 1 January 2000.While over 90 per cent of Australian businesses are aware of the year 2000 problem, barely 60 per cent have taken action or intend to take action to fix potential problems. Of those businesses that are not intending or have not begun to take action, the main reason they have not done so is that they are unsure about what they need to do, according to surveys. A quarter of those businesses that do not know anything about it claim that they will not be affected, and a staggering 16 per cent are unaware of what the problem is.Many Australian businesses and organisations are looking to the federal government for direction and assistance. Time and time again they have been disappointed with the level of information available. This bill will serve a dual purpose in that regard: not only will it provide a practical mechanism, or almost a financial incentive, for businesses to take on the challenge of proceeding down a path of remediation and preparing themselves for Y2K but it also demonstrates that there are costs involved.This brings me to the issue of how government agencies and departments will fare. As we have seen by the report recently released by the federal government, the state of preparedness within the government's own operations is very disappointing. The point has to be made—and the point is inherent in this bill—that remediation work costs money. It does cost business a lot. The 50 per cent of Australian businesses that have estimated the cost of Y2K compliance estimate that it will cost about $10,000 for each business. Even a similar, pro rata analysis of costing shows that it will be a relatively large imposition on government agencies.Whilst we have seen the government allocate some funding through the last budget to be divided up amongst Commonwealth departments and agencies, surely questions have to be asked about the state of compliance of those bodies. I will give examples of a few. The Administrative Appeals Tribunal lists their compliancy for business critical systems at zero—250 days from the year 2000. The Australian Customs Service is at 22 per cent compliance for business critical systems. The Australian Law Reform Commission is at 42 per cent. The most ridiculous and publicly well documented situation is that of the Department of Communications, Information Technology and the Arts—the very department that has the Office for Government Online, the section within that department handling the government's strategy for Y2K compliance. A mere 36 per cent of its business critical systems is compliant. The National Science and Technology Centre is at 33 per cent compliance.The record is not good, but the point is that it costs money. It requires a commitment to fix this problem. This bill assists business in meeting the costs of becoming compliant. In the preparation of this legislation, the government can learn the lesson for themselves that if you want the problem fixed you have to invest in its remediation.The Taxation Laws Amendment (Software Depreciation) Bill 1999 proposes to implement a series of changes to the recognition of software expenses for businesses by using tax concessions to alleviate the financial burden. These fall into three broad categories. Firstly, there are those expenses associated with the development of Y2K compliance systems. Secondly, there are minor or redundant software expenses. Lastly, the bill proposes a new consistent regime for all non-minor software expenses.Following the ruling of the Commissioner of Taxation on year 2000 compliance expenses, the government proposes to broaden expenditures immediately deductible to also include expenditure on acquiring new software, including upgrades or substantially rebuilding current software to ensure Y2K compliance, provided these costs are incurred up to 31 December 1999.Debate interrupted.Adjournment407810000PRESIDENTThe PRESIDENT—Order! It being 7.20 p.m., I propose the question:That the Senate do now adjourn.407819:20:004078Ferris, Sen JeannieSenator FERRIS5L6SALP10—Tonight I would like to tell a story about a bank. `Which bank?' you might ask. I refer to a bank that was once known as the people's bank, a bank described by its founding father, Prime Minister Andrew Fisher, as a bank belonging to the people. Most of us have quite nostalgic memories of our little tin moneyboxes and our school bank accounts. In those days, the Commonwealth Bank was a community icon—a safe and secure repository for our savings and a part of the very important lesson about saving for a rainy day.Over the years, the bank has grown and changed, as indeed has the Australian banking industry. But always the Commonwealth Bank continued to be a bank for the people. In fact, in 1993 it claimed, very proudly in its annual report, that it operated responsibly `according to commercial principles with industry related performance objectives'. Its mission statement proclaimed that it aimed to be `a preferred provider of financial services to customers, helping them realise their goals'. However, what we now know is that the goals that could be realised varied from customer to customer.For many of the farmers of Australia, those wealth generators of this nation, the bank had a policy under the high interest rates forced upon all of us by the Hawke and Keating governments. I have no doubt that those hundreds, perhaps thousands, of farm families will never forget the way the Commonwealth Bank dealt with their particular goals and aspirations. Right across this country the Commonwealth Bank sold up, threw off, evicted, auctioned, foreclosed and bankrupted hundreds of farming families. Their problem was that they simply could not meet the Commonwealth Bank's demand for payment.Who could ever forget those televised scenes of forced sales with court officials dragging families out of their farmhouses, their belongings callously abandoned and their dignity totally disregarded. Let us recall a couple of them. There was Oswald, a 70-year-old Victorian war veteran, who was evicted from his soldier settlement farm because the Commonwealth Bank decided to call in his $½ million debt which had accumulated as a result of floods, poor seasons and, most of all, high interest rates. Another was Robert, a farmer who borrowed $120,000, a debt which eventually blew out to $½ million as Commonwealth Bank interest rates reached 22 per cent. He was forcibly sold up by the bank when he was unable to pay the bank the demanded $275 a day required to cover his debts. So this was how the Commonwealth Bank helped those farmers `realise their goals', and there were hundreds more of those tragic stories across this country. But not for every customer.The Commonwealth Bank provided special deals for some very special customers. This afternoon the Senate heard how the Commonwealth Bank did some very special favours for another well-known farmer, favours which enabled him to pocket millions of dollars when he sold his farm, even though his property, a piggery, was also in debt to the Commonwealth Bank. It was not hundreds or thousands of dollars in debt but in fact millions of dollars in debt.Farming Keating claimed that his farm was a `first-rate asset'. We now know that it was not. I seek leave to table a 1995 report by KPMG, which in paragraph (vii) declared that the Euphron group of companies could only continue to trade with the support of the group's shareholders and bankers.Leave not granted.5L6Ferris, Sen JeannieSenator FERRIS—How interesting that leave is not granted. Why don't these people want to know the truth about this matter? But the Commonwealth Bank came to the rescue for this high profile farming Prime Minister—no doubt with its corporate mission statement in mind of helping customers to realise their goals—and it was a pork-barrelling exercise that would do a pig farmer proud. In a deal that would sicken the stomachs of thousands of hardworking, honest farm clients around this country, the Commonwealth Bank wrote off nearly $5 million of this pig farm's debt. I now seek leave to table a document which shows that in May 1994 the Commonwealth Bank did write off $4.9 million of the piggery group debt.Leave not granted.AX5EVANSSenator Chris Evans—Madam President, on a point of order: I just want to put on the record that the opposition reminds government senators there are courtesies involved in tabling documents. If they do not observe the courtesies, they will not be granted leave.5L6Ferris, Sen JeannieSenator FERRIS—In this case the bank silently wrote off the debt at the same time as the sale to Indonesian interests was taking place. In doing so, it allowed the multimillion dollar purchase price to flow to Farmer Keating without any claim by the bank. In summary, this extraordinary write-off, favour, gift or special deal for the Prime Minister was worth millions of dollars—in fact, almost $5 million.To put that into perspective, that year the Commonwealth Bank wrote off $26.5 million across the agriculture, forestry and fishing industries, mostly after the borrowers had been bankrupted and thrown off their farms. So Mr Keating's write-off accounted for almost one-fifth of the total debt written off, despite the fact that millions of dollars were on their way from Indonesia. There is little doubt that Farmer Keating was the only primary producer offered this gold plated financial deal. But there was more. The Commonwealth Bank took a second dip into the pork barrel, and it was equally generous and quite extraordinary. Keating and his partner wanted to maximise their take-out of the final settlement of the sale of their shares and Keating's option to the Indonesians. So at final settlement over the Anzac weekend in 1996 the bank came to the party again, this time with a gift worth almost $4 million to enable a successful sale. The gift was in the form of a six-year, no-interest loan which the bank granted the Indonesian purchasers at final settlement. On the same night that the bank did this deal, Farmer Keating walked away with more than $2 million as his final settlement. Not a bad consolation prize for a man who had been totally rejected by the Australian people only a couple of weeks before! Could any other of Australia's hardworking, wealth generating farmers get this special deal of a six-year, no-interest loan? Not likely. For the hundreds of Australian farmers who were thrown off their properties by the Commonwealth Bank, Farmer Keating's overflowing pork barrel must be sickening.Recently, 60 Minutes posed the question of whether the bank and Keating conspired to blackmail Al Constantinidis to buy his silence about the piggery deals. It established that the bank settled its $11 million plus action against Constantinidis for $½ million. There is no doubt that Farmer Keating was a significant beneficiary of this decision, which until very recently bought silence from his former partner and, of course, was intended to buy his silence permanently. So there we have it: a barrel of pork containing special deals worth $20 million. It is enough to make Andrew Fisher turn in his grave—`a bank belonging to the people' indeed. Today, the Commonwealth Bank denied any wrongdoing, but standard denials by press release are no longer enough. The taxpayers and the farmers of Australia want to know why the Commonwealth Bank wrote this money off, they want to know who made the decision, and they want to know now. Pig farmer, Prime Minister, gold plated customer P.J. Keating must surely have been the only farmer in Australia who successfully and silently negotiated a $20 million gift from one of Australia's great public institutions—the Commonwealth Bank of Australia.EU4O'CHEESenator O'Chee—Madam President, I rise on a point of order. During Senator Ferris's contribution, Senator Evans, by point of order, indicated that leave had not been granted for the tabling of the document sought by Senator Ferris on the basis that the courtesies of the chamber had not been observed. The courtesies had been observed and, therefore, I am asking by point of order whether that means—because they are the same documents I sought to table earlier today—that the Labor Party is now willing to grant—AX5EVANSSenator Chris Evans—We did not know that.EU4O'CHEESenator O'Chee—It was indicated. Does that mean you are willing to grant it?408019:30:004080Lundy, Sen KateSenator LUNDY7G6ACTALP00—This week a great Australian, Ric Throssell, passed away in very sad circumstances along with his dear wife—Senator Chris Evans interjecting—10000PRESIDENTThe PRESIDENT—Order! Senator Lundy has the call and it is impossible for anyone to hear when people near to her are making a lot of noise.AX5EVANSSenator Chris Evans—I apologise, but if I get called `crooked' I usually respond to Senator O'Chee. I know he is trying to make a reputation as he leaves this place, but it is too late.10000PRESIDENTThe PRESIDENT—Neither of you should be shouting across the chamber.7G6Lundy, Sen KateSenator LUNDY—It is a shame that more respect is not shown across the chamber at times. This week a great Australian, Ric Throssell, passed away in very sad circumstances along with his dear wife, Dorothy. Ric was known to most Australians as a novelist, and to Canberrans as a long time public servant. Even if Ric's service as a diplomat is not remembered by many, he deserves to be recognised for the loving literary portraits of his parents, Hugo Throssell, who was awarded the first VC at Gallipoli in 1915, and Katharine Susannah Prichard, who was one of Australia's most famous literary figures.Ric was also closely associated with the Canberra Repertory Society as an actor, director and writer. His published plays, several of which have won awards, are Valleys of the Shadows, Devil Wear Black, Suburban Requiem and The Day Before Tomorrow. During the Second World War, Mr Throssell saw action in New Guinea. When writing his autobiography, My Father's Son, he vividly detailed the horrors of war. I quote: The reality of war was different. It left no room for imagination. I had thought I could imagine what it would be like. The accounts of the hardships and heroism of men in battle in the papers at home had left me with vivid impressions of the horrors of war. I thought I knew.It was not true! You had to be there.No one could imagine the way war turned men into lumps of meat, the scrag-ends of flesh and offal in a butcher's rubbish bin; scraps for the dog. No one could know the tragic courage of men who faced that.Having survived the horrors of the New Guinea campaign, Ric joined the Department of External Affairs, where he represented Australia in Moscow and Rio de Janeiro. But, unbeknown to Rick, even before he became a diplomat he was under surveillance by Australia's military intelligence.As the son of one of Australia's pioneering communists, Katharine Susannah Prichard, security services had taken a special interest in the Throssell family and Ric was placed under surveillance by just about every security organisation possible—the CID, the CIB, Special Branch, Special Bureau, the Attorney-General's Department and ASIO. From all accounts it appears that in 1945 someone somewhere mentioned his left-leaning politics, and that this, combined with his mother's involvement with the Communist Party, made him a security risk.Years later, when freedom of information files allowed Ric access to this information, the extent to which he was pursued, followed and hounded became apparent. Despite the witch-hunt, the security services could not find the `evidence' that they were looking for. Even the Petrov Royal Commission tried to besmirch him. All they achieved was spreading scandal and rumour with no evidence whatsoever.Being the son of Katharine Susannah Prichard, a founding member of the Australian Communist Party, meant that a climate of fear and innuendo surrounded the family continuously. They were subjected to police raids and searches, telephone tapping, letter interceptions, document seizures and investigations carried out on their friends. Even though Ric was never a member of the Com munist Party—he was a member of the Labor Party—he was pursued by ASIO relentlessly.In 1953 they decided to interview him at the Hotel Canberra, and I believe ASIO's report is worthy of inclusion in this contribution. ASIO reported that `his appearance was most unlike what one would expect from a member of the diplomatic corps. He wore a cheap, badly fitting pale blue suit and he was not wearing a black tie.' Even though Ric was a career diplomat held in the highest esteem by his colleagues, he was denied promotions because he was not allowed access to confidential documents as a result of the persecution. In 1989 he published his autobiography, entitled My Father's Son, which vividly and quite emotively recounted how even those closest to him were prepared to participate in rumour spreading and deceit.There was, however, a much more entertaining and positive side to the life story of Ric Throssell. He authored a wonderful collection on the life and letters of his mother, called Wild Weeds and Wind Flowers. He also edited two books dedicated to his mother's literary career, Straight Left and Tribute. In April last year I was honoured and privileged to launch his novel entitled Tomorrow, along with a revised edition of My Father's Son. I spoke then about how his life had been one of tragedy, excitement and injustice. It was a life that was both inspirational and deeply frightening. At that launch, Ric paid tribute to his lawyer and to the Canberra Times, for recognising that he had been victimised by Australia's security services, as they had published part of his story.I would like to conclude by remembering Ric Throssell's contribution to Australia, and in particular his wonderful literary talents. Today I took some time out to revisit My Father's Son and came across this delightful and very poetic description of his first arrival in Canberra during World War II. I quote:It didn't look much like the nerve centre of a country. Solid suburban houses laid out with architectural symmetry behind neatly uniform hedges, low white blocks of government offices planted here and there. Parliament House posed for its picture between a fringe of nonchalant lemon-scented gums . . . even the blue swell of the Brindabella Ranges on the horizon seemed to have been painted as a Namatjira background to Canberra. The Molonglo trickled between poplars and willows.I think this extract is a fitting tribute to a remarkable Australian who was persecuted for being suspected of holding different views and who enriched, throughout his life, the fabric of this nation with his outstanding contributions as a soldier, a diplomat and a writer. Indeed, in his final work, a literary work entitled Jackpot , Ric, oh so recently, has made another significant contribution to the social fabric of this country, detailing the challenges that so many Australians face with the personal tragedy associated with an addiction to gambling.To Ric, someone I have known personally, albeit only so briefly, goodbye, and thank you for your contribution to this nation.408119:33:004081Gibson, Sen BrianSenator GIBSONBX5TASLP10—This afternoon, Senator Calvert raised recent disclosures about former Prime Minister Paul Keating. As Senator Calvert correctly stated, facts now in the public domain concern issues of misuse of power for personal gain, illegality, criminal tax evasion, gross impropriety, cover-up and lies. They also raise serious questions about the corruption of Australian federal institutions, namely the office of Prime Minister and the Commonwealth Bank of Australia.This is far worse than Watergate, Profumo, the Monica Lewinsky scandal or any international scandal one might care to recall. Published statements and documents now on the record raise a clear, prima facie case of capital gains tax fraud by Paul Keating.Firstly, there is a memo drawn up by Asian advisers to the purchasers of Paul Keating's half share of the piggery. This information is a record of advice from Paul Keating's lawyer, Chris Coudounaris, about how he structured the payment of $US6 million for Paul Keating's half share of the piggery to avoid possible political repercussions. The document is extraordinary. It clearly indicates an intent by Paul Keating to commit tax fraud while Prime Minister of Australia. The Gadens Ridgeway trust account statement, tabled last year in the Senate, is evidence that this scheme to evade tax was, on the face of it, implemented.The authenticity of this document has not been challenged. Furthermore, Al Constantinidis confirmed that the intent to evade tax by the scheme, outlined by Keating's lawyer, was coupled with an actual transaction as outlined. Finally, what Al Constantinidis told channel 9 60 Minutes was absolutely dynamite. Constantinidis said that $1.35 million of the $1.9 million that was injected into a company controlled by him to make it look as if it was an injection of equity was in fact paid to Paul Keating. As Senator Calvert pointed out this afternoon, 60 Minutes uncovered the existence of a second trust account document, detailing how $1.2 million of those millions were channelled to a Keating trust company. I seek leave to table this Gadens trust account document, which was in fact shown to members of the opposition this morning.Leave not granted.BX5Gibson, Sen BrianSenator GIBSON—By resisting the tabling of this document, Labor is showing it prefers ignorance and tribal party allegiances over truth. It is indulging in a blatant cover-up. Opposition leader Kim Beazley should show some leadership and agree to the tabling of the relevant documents.Secondly, I wish to again remind the Senate that it is beyond question that the Indonesian purchaser agreed to pay Paul Keating $US6 million for his half share of the piggery. Keating told Kerry O'Brien on the 7.30 Report last year that he got only a minority of that money. But Keating says Constantinidis got over $9 million. In saying this, it appears that Mr Keating is counting as Al's moneys which were to be channelled through Al to Keating himself. As Senator Calvert said, if Keating applied the same logic to what he personally got to what he claims Al got, then he would be owning up to the following: that in 1994 the Indonesians agreed to pay him $US6 million for his half share and, according to Constantinidis, a further $A1 million for his option in 1996. This totals approximately $US6 million, or well over $A10 million. Paul Keating could only have admitted to this if he had been honest with the Australian Taxation Office about his gains.As noted above, when under pressure last year, Keating said he got only a minority—that is, less than $3 million. However, there still remains a huge gulf between Keating's admission of only a minority—that is, less than $3 million—and the Indonesian agreement to pay him, in Australian dollars, over $10 million. 60 Minutes managed to establish beyond doubt that he received at least $4 million. It is time for Mr Keating to tell Australian taxpayers what he has done.408219:43:004082Sherry, Sen NickSenator SHERRYZW4TASALP00—I wish to draw to the attention to the Senate tonight a very serious and iniquitous situation that has arisen as a consequence of the Liberal government's superannuation surcharge tax. This superannuation surcharge tax was introduced in the 1996 budget—the first budget of the Liberal government. This new tax was introduced in direct contravention of the commitment given in the lead-up to the 1996 election by Mr Costello, the Treasurer, and Mr Howard, the Prime Minister, that there would be no new taxes and no increase in existing taxes. Of course they tried to be half smart and called it a surcharge in order to avoid an accusation of breach of promise during the 1996 election.The super tax—and it is a tax, not a surcharge; that is certainly what the Senate called it in respect of an amendment that was moved—has been widely criticised, and rightly, in the Australian community. I have spoken on this matter on a number of occasions. The so-called superannuation surcharge has resulted in a dreadfully iniquitous situation in respect of superannuation contributions of people earning below $72,000.I have had my attention drawn to groups of Australian workers being seriously adversely affected by this new superannuation tax. I remarked earlier that it is almost impossible to find any respected, knowledgeable commentator, accountant, actuary, lawyer, economist or funds manager who supports this superannuation tax and the way it is being administered. In fact, I do not know of any. Last year I had representations from two groups of workers at Pasminco's processing plant located in Hobart and their mining operation located in Rosebery on Tasmania's west coast. Both groups of workers had their superannuation guarantee contributions tied to a base earnings rate of approximately $24,900 per year.In the case of both the workers at the refining operation in Hobart and the workers at the Roseberry mine, they earn much more than $24,900 per annum. The amounts vary according to their particular job classifications, but their effective contributions to superannuation fall below the current superannuation guarantee contributions of seven per cent by virtue of industrial agreements which apply at both sites which equate superannuation contributions to $24,900, despite that not being their earnings. Whilst this was to the advantage of those workers when the superannuation guarantee was introduced, with the effluxion of time and the increase in the superannuation guarantee to a level now standing at seven per cent, moving to nine per cent, such an arrangement is no longer to their advantage.Through their union, the Australian Workers Union, which I might say is a union that has actively pursued their case, they have been seeking to have the base level of contribution that is included in the industrial agreements changed in order to reflect the seven per cent superannuation guarantee of the current earnings of an employee. The difficulty these workers face with respect to the mining side of Pasminco's operation is that they are receiving less than seven per cent of current earnings into the superannuation fund because of this formula. But the difficulty for the workers at the Rosebery mine is that, depending again on job classification, they earn, including overtime, between $68,000 and $80,000 a year.If we look at the definition of income for the purposes of the Liberals' new superannuation tax, it includes salary or wages and it does include, for example, overtime. Whether or not the workers at the Rosebery mine operation are earning overtime, the fact is that most of them do earn between $68,000 and $80,000 a year, and therefore a substantial proportion of them are required to pay the superannuation tax. Yet they are not receiving superannuation contributions that equate to seven per cent of their current earnings. This is a grossly unfair, unjust and absurd situation. It is a further example that highlights the difficulties with the superannuation tax. If there were some logic to the superannuation tax—and I do not believe there is, particularly in the way it is administered—it certainly should not include overtime; but it does. Australian workers do not have superannuation guarantee contributions paid in respect of overtime, they have it paid only in respect of ordinary time earnings. So we have clearly got a serious anomaly that impacts substantially.The other group of workers that has been drawn to my attention includes an electrician who I know is not alone with this particular problem. He earns substantially less than $72,000 and does receive superannuation guarantee contributions of seven per cent of whatever his earnings are from year to year, but those earnings are less than $72,000, excluding overtime. However, he does substantial overtime, and that overtime takes him over the $72,000 cut-off for the application of the superannuation tax. Therefore, he is required to pay the new superannuation tax. Again, he is receiving superannuation contributions on his earnings excluding overtime, but because he works substantial overtime—and there would be many workers in this situation—he is taken over the $72,000 threshold and has to pay the superannuation tax when effectively he is not receiving the superannuation contributions equating to that level of income. This is similar to the situation of the workers employed at the Rosebery mine operation.I gave notice in the Senate of a five-part motion that outlined the particular problems that I have touched on only briefly this evening. It certainly was my hope that the government would support the motion that called for, firstly, changes to the SG legislation, to ensure that no employee receives less than seven per cent of their annual earnings— whatever that may be from time to time—and, secondly, the removal of overtime from the definition of earnings for the purposes of a superannuation tax. Regrettably I have to say that the government, callous in its disregard for the application of a superannuation tax—and, indeed, for superannuation generally—did not allow that motion to proceed yesterday and to be passed by the Senate.We know that Senator Kemp has proposed some further amendments to the superannuation tax or surcharge. It will be interesting to see if the government deals with this issue, but I make it clear to the Senate that I intend to persist with it to see that justice is done for the groups of workers that are adversely affected in this way. (Time expired)19:53:004084Senate adjourned at 7.53 p.m.Documents40844084The following documents were tabled by the Clerk:Navigation Act—Marine Orders—Orders Nos 9-11 of 1999.Safety, Rehabilitation and Compensation Act—Notices of Declaration—Notices Nos 1-3 of 1999.Answers to Questions on Notice4085The following answers to questions were circulated:4085(Question No. 204)2044085Faulkner, Sen JohnSenator Faulkner5K4NSWALP00 asked the Minister representing the Prime Minister, upon notice, on 24 November 1998:Will the Prime Minister release the report prepared by the former Secretary of the Department of Administrative Services, which the Prime Minister stated he expected to "have on his desk" on 29 September 1997; if so, when; if not, why not.4085Hill, Sen RobertSenator HillBH4SALPEnvironment and Heritage10—The Prime Minister has provided the following answer to the honourable senator's question:A preliminary report was provided to the Prime Minister on 28 September 1997 by the former Department of Administrative Services.Further information was included in the final report which was provided by the Department of Finance and Administration (DoFA) to the then Special Minister of State, Senator the Hon Nick Minchin, in November 1997. Following his consideration of the matter, Senator Minchin briefed the Prime Minister on the final report and the advice provided to him by DoFA.It is a matter of public record that the Special Minister of State referred the matter to the Attorney-General who forwarded it to the Minister for Justice who referred it to the Australian Federal Police (AFP) for independent assessment and advice from the Director of Public Prosecutions. It is also a matter of public record that following the AFP review, the relevant law enforcement authorities concluded the matter on the basis that further action by them was not warranted.The final report was not provided to the Prime Minister as he was fully briefed on that report by Senator Minchin prior to the matter being referred to the relevant law authorities, as outlined above.The report provided to the Prime Minister in September 1997 was a preliminary report only, not a complete and final document, and the Prime Minister does not propose to release it. 4085(Question No. 410)4104085Woodley, Sen JohnSenator WoodleyHX5QLDAD00 asked the Minister representing the Minister for Employment Services, upon notice, on 24 February 1999:With reference to a report in the Canberra Times on 8 February 1999 which states that `work for the dole' participants will help look after toddlers and children at child care centres run by the Southside Community Service in the Australian Capital Territory:(1) How many Work for the Dole participants will be taking part in assisting with the care of children at child care services run by Southside Community Service(2) What process was followed in selecting which Work for the Dole participants are suitable to assist in the care of children.(3) What police checks and training will Work for the Dole participants undertake before commencing work with children at child care centres.(4) What consultations with the parents of children at these centres was undertaken before the decision to place Work for the Dole participants in these facilities was finalised.(5) How many other child care centres throughout Australia will be participating in the Work for the Dole program.(6) Will private child care centres throughout Australia also participate in this program.(7) What additional responsibilities will be placed on existing child care centre employees as a result of the employment of Work for the Dole participants.(8) Will Work for the Dole participants be left to care for children without supervision in child care centres.4085Alston, Sen RichardSenator AlstonLD4VICLPCommunications, Information Technology and the Arts10—The answer to the honourable senator's question is as follows:(1) Twenty-four participants will be taking part in the Round 1 Work for the Dole project at Southside Community Child Care Service which commenced on 8 February 1999. A further twenty-four participants are expected to commence a Round 2 Work for the Dole project in August 1999. (2) The following is specified as the minimum procedural requirements for selecting participants in Work for the Dole child care projects:* the principal or head of the centre must participate in interviews to select participants and have control over who is selected; and* reasonable inquiries must be made in respect of participants including referees reports from persons who have known the participant for a minimum of 5 years, and police checks on participants to establish he/she has no convictions for crimes against children.The objective is to establish whether the participant is a fit and proper person to participate in the project.(3) Each participant will be automatically subjected to police checks to establish he/she has no convictions for crimes against children. In the Southside Community Service Work for the Dole projects all participants will be provided with the following training:* Occupational Health and Safety;* Safety and Hygiene;* Behaviour Management in Children;* Programming for Children;* Effective Communication in the Workplace;* Developmental Stages of Children 0-6 years; and* Red Cross/St John Ambulance First Aid Certificate.(4) It is a requirement that all Work for the Dole projects meet the needs of the local community and have the support of key community groups. Southside Community Service were able to demonstrate that the project had the support of the community. It is understood that parents of children attending the Southside Community Child Care Service were informed in writing of the Work for the Dole project prior to commencement and that formal consultations were undertaken with the parents once the project commenced.(5) There are nine Work for the Dole projects for approved child care centres across Australia for Round 1 (ie, commencing August 1998 to February 1999) and six projects approved for Round 2 (ie, commencing from February 1999 to August 1999), including the Southside Community Service projects.(6) Private sector `for profit' organisations, including child care centres, are not eligible for funding under the Work for the Dole program. In addition, participants cannot be placed in private sector `for profit' organisations.(7) Sponsors with Work for the Dole projects in child care services must ensure participants are adequately supervised at all times by appropriately qualified carers employed by the Sponsor. Sponsors are provided with funding under the Work for the Dole program to employ qualified supervisors and therefore there should be no increase in responsibilities for existing child care employees.(8) Refer to (7) above.4086(Question No. 525)5254086Ray, Sen RobertSenator Robert RayUI4VICALP00 asked the Minister representing the Minister for Defence, upon notice, on 9 March 1999:What was the total cost during the 1997-98 financial year of the provision of newspapers, magazines and other periodicals to the minister's: (a) Parliament House office; (b) home/state ministerial office; and (c) private home.4086Newman, Sen JocelynSenator NewmanBE4TASLPFamily and Community Services; Minister Assisting the Prime Minister for the Status of Women10—The Minister for Defence has provided the following answer to the honourable senator's question:(1) (a) The Department of Defence paid the following amounts during the 1997-98 financial year for the provision of newspapers, magazines and other periodicals to the ministers' Parliament House offices:Minister McLachlan—$3223.15—(Manuka Newsagency); $150.00—(Aviation Week & Space Technology): Total—$3373.15Minister Bishop—$2212.25—(Manuka Newsagency)(b) The Department of Defence paid the following amounts during the 1997-98 financial year for the provision of newspapers, magazines and other periodicals to the ministers' home/state ministerial offices:Minister McLachlan—$1320.35—(Adelaide Newspapers)Minister Bishop—Nil(c) The Department of Defence paid the following amounts during the 1997-98 financial year for the provision of newspapers, magazines and other periodicals to the ministers' private homes:Minister McLachlan—NilMinister Bishop—Nil. 4087(Question No. 622)6224087Woodley, Sen JohnSenator WoodleyHX5QLDAD00 asked the Minister representing the Minister for Defence, upon notice, on 24 March 1999:With reference to the answer to question on notice no. 1062 (Senate Hansard , 10 March 1998, p.754):(1) Did the decision to build the airstrip result from a request from another power; if so, in what form was the request received.(2) What was the objective that was to be fulfilled by the construction of the airstrip.(3) (a) What security classification was given to documents and materials pertaining to this matter; and (b) what is their current classification.(4) What was the cost to the Australian Government of Operation Crown.(5) (a) What arrangements, if any, were made to compensate local land-holders for the alienation of their land; and (b) who was responsible for making these arrangements.(6) To whom was the airstrip handed over to on completion.4087Newman, Sen JocelynSenator NewmanBE4TASLPFamily and Community Services; Minister Assisting the Prime Minister for the Status of Women10—The Minister for Defence has provided the following answer to the honourable senator's question:I draw the honourable senator's attention to the reply to Senate Question On Notice No. 1231, provided by the then Minister for Defence, the Hon Ian McLachlan AO, which was published in Official Hansard No. 10, 1998 (continued), answers to questions which were circulated after the rising of the Senate on 11 July 1998 and before the prorogation of the Parliament on 31 August 1998.