1999-04-273912SENATE427301999-04-27The PRESIDENT(Senator the Hon. Margaret Reid) took the chair at 12.30 p.m., and read prayers.Bills4273r703Billsr667Billsr666Billsr702Billsr699Billsr698Billsr664Billsr660Billsr658Billsr657Billsr701Billsr663Billsr659Billsr700Billsr6614273A NEW TAX SYSTEM (GOODS AND SERVICES TAX) BILL 1998Consideration resumed from 23 April.10000CHAIRMANThe CHAIRMAN—The committee is considering A New Tax System (Goods and Services Tax) Bill 1998 . The question is that the bill stand as printed.12:31:004273Cook, Sen PeterSenator COOKRF4WAALP00—At close of play on Friday or at stumps on Friday, whichever is the proper parliamentary term, one of the issues that were being canvassed in this chamber was the question of the constitutionality, particularly of the GST imposition bill. Substantive questions had been raised in debate, firstly by—and I acknowledge this—Senator Harradine and, secondly, I entered the debate with a view as well. In my case, the conclusions were that there are doubtful questions about the constitutionality of this legislation.The matter that was being canvassed before the chamber was whether the government would expose its briefing on the constitutionality question to determine—or to guide us or, at least, to expose to us—why the government believes these bills are constitutional. Since we have had an interruption of three days in this debate, albeit none of them working days—but in the national interest, one does work over the weekend—I wonder—YE4BOSWELLSenator Boswell—But not before breakfast. That was your advice.RF4Cook, Sen PeterSenator COOK—If you are in the Labor Party you probably do work before breakfast. I can't vouch for the National Party. But I wonder, Senator Kemp, whether or not you can answer this question: have you been able to consider this matter further and, if you have, are you in a position now to provide any further information to the chamber on the constitutional question?12:33:004274Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Just before I get onto that matter, there was a question that Senator Sherry raised at the end of his remarks, before stumps were drawn on Friday, relating to the financial impact of government amendments. In response to Senator Sherry, there is a negligible financial impact because most of the amendments restore the government's original policy intention.ZW4SHERRYSenator Sherry—So you made mistakes, then?WW4Kemp, Sen RodSenator KEMP—Senator Sherry, just contain your enthusiasm. As stated before—ZW4SHERRYSenator Sherry—One hundred and twenty-eight mistakes.WW4Kemp, Sen RodSenator KEMP—This is very early in the piece, Senator Sherry. As stated before, the amendments finetune the legislative package. Some other measures are needed to provide options that reduce compliance costs without having a significant financial impact for the government.There was another wider issue that Senator Cook raised regarding the information on groups consulted in preparing the amendments. As I mentioned, Senator Cook, the government spoke to a wide range of groups when consulting on the tax reform legislation. These included a number of industry, business and community groups, as well as interested individuals. The range of groups that made representations to the government has been so comprehensive that I do not think providing a list would be all that helpful. Many groups suggested similar amendments. Therefore, I do not think it would be appropriate to attribute particular amendments to particular groups.In relation to the constitutionality that Senator Cook has just raised, contact has been made, following the debate on Friday, with the office of the Attorney-General. The advice confirmed that the government's general policy is not to table legal advices in the parliament. I think that was the policy followed by the previous government—it is the policy followed by this government.I do not say that there have not been rare occasions when advices have been tabled, but that is the general position. The Attorney-General's office also confirmed that the government—and this repeats what I said—does not introduce bills into the parliament that are unconstitutional and processes are followed to ensure the bills are in fact constitutional.12:36:004274Cook, Sen PeterSenator COOKRF4WAALP00—In view of that answer, leaving aside the first part of it, did the government explicitly receive advice from the Solicitor-General, or from him via the Attorney-General, on the question of constitutionality when considering this legislation—or did it not?12:36:004274Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I have just said that it is not our general policy to table legal advices in the parliament and that particular advice was confirmed in discussions with the Attorney-General's office following your question. The other point I made was that clearly there are processes in place—that I assume all governments follow—to ensure bills that are introduced into the parliament are constitutional. I do not think I can add more to what I have already said.12:37:004274Cook, Sen PeterSenator COOKRF4WAALP00—I understand what you have said about not tabling the advice. My question was not to that issue. My question was: in getting these bills up, did the government have advice about their constitutionality or not? The reason I ask that question is that this issue has been broached in the chamber. It is clearly a foundational issue in terms of this legislation.These bills are a package. If there is doubtful constitutionality over one of them, that throws doubtful constitutionality questions over all of them. It would seem to me that prudent government would at the beginning of this process have obtained advice on this matter. My question is only, and no more than this: did you obtain explicit advice on this matter at the beginning of the process from the Solicitor-General—who I think would be the right officer of the Crown—and the right minister, the Attorney-General, on the constitutionality question or did you not?12:38:004275Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—There could be many issues. A variety of issues have been raised already in this chamber dealing with constitutionality matters. What I can say is that you can be absolutely assured that the government is very aware of this issue and took all appropriate steps to ensure that the bills that were brought before this parliament were constitutional.I am not being difficult. I really want to make the point that we are very conscious of this issue. This is an extremely important package of bills. These bills give effect to the government's election policy and the government is very confident that the bills are constitutional. The government ensured that the bills went through all appropriate processes to ensure that they were drafted in a way which is constitutional.The government does not propose to table in the parliament any legal advices that may have been received, and we are following precedents that are well established in this parliament. You asked about prudent government. I can tell you that we have been very prudent and careful in this matter.12:39:004275Cook, Sen PeterSenator COOKRF4WAALP00—I am not sure that I have got an answer to my question. I understand what you are saying about not tabling the advice in this chamber. I am not asking about that question. I am asking: did you obtain that advice? Given that your answer is that the government acts constitutionally, I assume from the answer that, yes, you did obtain the advice. If you wish to correct me, please do, but if you do not correct me, I will assume that that is confirmation that you did obtain that advice.Last Friday you offered to Senator Harradine—and that appears on page P3669 of the Hansard—the option of being briefed on the legal advice by the government. That is a different matter to tabling legal advice in the parliament. In that debate I asked as well—and acknowledging that other parties in this chamber may also raise the question with you: if you were offering a briefing on constitutional matters to a senator who is quite rightly entitled to such a briefing in my view, would you also offer that briefing to the Labor Party, and, lest I be accused of cutting off anyone else's rights, any other party that may wish to raise that matter as well, and I imagine others will? My question, therefore, is: given the offer you have made, will you extend that offer to all of us?12:41:004275Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Essentially what happened was that there were some initial discussions on the question of a briefing. Then, as the debate continued, in a sense the chamber was briefed. You and I had a pretty vigorous exchange in the course of that debate. It seemed that the debate had moved on from the position raised initially by Senator Harradine. Then I responded in quite some detail to the matters that you raised. The Hansard would show that both of us were relentlessly quoting the same cases. There was a frank exchange of cases and precedents.In a sense the debate moved on further, but I will raise with the Office of Parliamentary Counsel, if there was a private briefing requested, whether he would be able to do that on a wider basis. I would have to say that my general view was that the debate had moved on since we had that discussion, but I will mention your concerns in this chamber and raise them with the relevant people.12:42:004275Cook, Sen PeterSenator COOKRF4WAALP00—I am aware of other senators wishing to speak so I will conclude my questioning in a moment. I understood that the offer had been made. I certainly confirm the discussion we entered into, because I made an intervention which put down quite fully the precedential nature of this section of the constitution and why one would consider the matter to be of doubtful constitutionality. I acknowledge that, before I spoke, the honour of the green belonged entirely to Senator Harradine, who raised this question and had gone to the substance in considerable detail himself.All that being said, and acknowledging that you have not withdrawn your undertaking to Senator Harradine but are simply wanting to check again to see whether it still stands, if the undertaking were to be given to all of us individually, what would therefore be wrong with simply putting it down in this chamber? I imagine you are going to expose it to all of us—therefore, we are not bound by any oath of secrecy not to divulge it beyond the briefing room. If you are giving it to us on that basis, what is wrong with giving it to the Australian community at large via this chamber? Inevitably this is a matter that does engage the mind of many in the broader community as well.12:44:004276Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I hear what you say, and I stick with the remarks I made that I will check to see what further can be done. I record your particular concern and the fact that we did really have an extensive debate following that. My view was to see whether we could move on and maybe, if there were one or two who were a bit concerned about constitutionality issues, we could deal with that without needing to take up the time of the chamber. That actually did not occur. We took up quite an extensive amount of time in the chamber on it and I provided the briefing.I hear what you say, Senator. I think the government's general position is that, with any legal advice that is obtained, that advice typically is not tabled in the parliament for reasons which you would be aware of as a senior minister in a former government, as I am aware of it. But, seeing you have raised the issue that you wish to go further, let me take that particular aspect on notice and I will come back to you.12:45:004276Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—I would like to ask the minister a question or two in relation to the overall legislation, in particular in relation to this parliament's obvious responsibility to ensure that all aspects of the legislation have been considered properly and have been done in accordance with other existing acts.I want to ask the minister whether or not the government considered the application of the Environment Protection (Impact of Proposals) Act as part of developing and formulating its tax package proposals, and whether the government sought the opinion of the Minister for the Environment and Heritage in this regard. I am sure that, as a former shadow spokesperson for the environment, the minister is well aware of the content of the Environment Protection (Impact of Proposals) Act. To refresh his memory and to ensure other senators are aware of what I am asking, section 5 of that act, which sets out the object of the act, says the object of the act is to ensure that matters affecting the environment to a significant extent are fully examined and taken into account in relation to the formulation of proposals. And there are a number of other relevant subsections flowing on from that.Obviously, in formulating these proposals a lot of evidence has been given to many of the Senate committees, in particular the Senate environment committee, about potential impacts of these tax changes on the environment, which I can go into in some detail. I do not think there is much doubt from the evidence presented that potentially there are some very significant environmental impacts. So my question to the minister initially is whether or not the government sought the opinion of the environment minister about whether or not the government's tax package and the proposals they were formulating serve as an appropriate trigger under section 5 of the Environment Protection (Impact of Proposals) Act.12:47:004276Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Senator Bartlett, you are right about my interest in issues concerned with the environment. It is really a very important area. In relation to whether the minister for the environment was consulted, of course he was. The minister for the environment was part of the cabinet that initially approved the variety of bills which have now come forward. As you would expect, as a senior minister the minister for the environment would take a very close interest.In relation to the impact on the environment, I can understand the position you have put to the chamber: that there was various evidence led which argued that this would have a significant impact on the environment. Equally, there was other evidence led which argued the contrary position. I think a fair reading of the various reports that were brought down shows that these particular issues were canvassed in the environment report and there were views put forward one way and the other. The position which I found most persuasive—this will not surprise you—was in the report brought down by the government members. I think that fairly canvassed the evidence that was before that committee.12:49:004277Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—I am sure that Senator Hill was involved in cabinet discussions about the tax package, but in terms of the official responsibilities under the Environment Protection (Impact of Proposals) Act there is a responsibility that he be requested to specifically consider whether this triggers, or requires the triggering of, an environmental assessment. I am not asking the environment minister whether or not he has undertaken a full, comprehensive assessment; I am asking whether or not the government specifically sought the opinion of the minister in a formal sense as is required under the Environment Protection (Impact of Proposals) Act while they were formulating their tax proposals. I think it is an important question not only in terms of our ability as a parliament to be sure that appropriate procedures were followed but also obviously in terms of the message we send to the rest of the community.We not unreasonably require people in the broader community to ensure that proposals that they are developing and that potentially have a significant impact on the environment are assessed fairly comprehensively to determine what those impacts may be. If, quite rightly, we are asking the community on one level to undertake those assessments and yet the government does not follow its own responsibilities in that regard, then I think it does send out a very negative message to the community.If I am correct in assuming that what is implied by the minister's initial response to my question is that the government has not specifically requested the environment minister to consider whether or not an impact assessment should be made, will the govern ment at this stage of proceedings at least undertake that formal process and send a letter to the environment minister asking him to consider whether or not an impact assessment should be made, as is his responsibility under the relevant legislation that is already in place—and has been in place for about 25 years, I think?12:51:004277Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I think some of the evidence that was led by the relevant department was that you cannot consider these bills in isolation from other measures that the government is bringing forward. I would underline that there has been an inquiry into this, and evidence backing up a variety of positions was led at that inquiry. I can understand you perhaps focusing on one particular set of views that was put forward. But the government's position was, I think, pretty well encapsulated, from memory—and I would have to check every word—in general in evidence in the report that was put down by the government senators. Senator Hill is, I would reiterate, a significant figure in this parliament. He is a member of the cabinet.ZW4SHERRYSenator Sherry—We are glad he is back this week.WW4Kemp, Sen RodSenator KEMP—Senator Sherry is—ZW4SHERRYSenator Sherry—I bet you are glad, too.WW4Kemp, Sen RodSenator KEMP—Well, we are all glad he is back this week.10000TEMPORARY CHAIRMANThe TEMPORARY CHAIRMAN (Senator Ferguson)—Order! Senator Sherry, you are not in your correct seat. Please do not interject from somewhere else.WW4Kemp, Sen RodSenator KEMP—We are all glad he is back. I do not think I have anything more I can add to the earlier remarks I made.12:52:004277Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—This is an important point. It is not just a bit of nitpicking about following proper process. We do, as I said previously, insist upon the community at large that, when they are developing and putting forward proposals, they do follow these appropriate channels. The least the government can do is ensure its responsibilities under existing legislation are fulfilled. It is not just a matter of Senator Hill happening to be sitting in the room when people were talking about the tax package. He has a specific legal role, and there is a specific and appropriate legal obligation and procedure to be followed in these regards.I am not at this stage specifically debating with the minister whether or not there will be major environmental impacts. Obviously, the Democrats have already put on the record a number of major concerns we believe are quite legitimate about the likely environmental impacts. What I am asking is whether the proper legal process has been followed. Apparently not. In that case, will it be followed?To reinforce why this is an appropriate procedure for the government to follow, I go back to the second reading speech of the relevant minister when this act was first put in place in 1974. Speaking about the scope and the role of the act, the minister stated:. . . we will not be limiting its scope in terms of the type of proposal that could be the subject of a statement. Proposals to change a tax or subsidy, to change a tariff—and I emphasise those—to plan and develop a particular construction, to build a new city—and he gave various other examplescould all be the subject of an impact statement.It may well be that, when the environment minister, Senator Hill, is asked to consider this, he considers it and says, `I don't believe it does need an impact statement. I think it's fine.' He could set out his reasons for that and that could then be provided to the parliament. That is the proper process to follow in formulating procedures such as these.I think it is appropriate for us as a parliament to be able to be sure that that process has been done: that the environment minister has specifically considered this matter and that the Treasurer, as the responsible minister—the trigger minister, if you like—has specifically fulfilled his responsibilities and asked the environment minister to give regard to whether or not an assessment is required. So it is an important legal process that should be followed if the existing act is to have any weight.I again ask the Assistant Treasurer whether or not he will give a commitment to send a letter to Senator Hill specifically asking him to formally decide whether or not these proposals should or should not trigger an environmental impact assessment. The environment minister can then say, no, which is his right, and we can all be sure that that has been properly looked into by the relevant minister. I would also ask on top of that: if the proper legislative procedure has not been followed, is the government actually running the risk—simply by not wanting to bother about these sorts of procedures and not examining this issue—of having the legislation challenged after it is enacted?(Quorum formed)12:57:004278Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Senator Bartlett, let me make the point that the government did follow proper procedures. The environment minister, as I said, was intimately involved in this process and the approval of the bills. At no stage did he call for an environmental impact statement. So I do not accept the proposition that proper procedures were not followed in this bill.12:58:004278Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—I have one final question on this. Obviously, the minister does not accept it, but I think it is important to assess whether or not the courts might accept it as not following the proper legal requirements under the act. As I said before, just having the minister sitting around in cabinet discussions on it is quite different to him being formally asked and having to formally decide, as is his legal responsibility. In some ways, it is as significant as some of the discussions we have had about the constitutionality of the bill. If legislation proposals are formulated without ensuring that proper legal processes are followed under existing legislation, does that leave it open to any sort of ruling or challenge in the courts down the track?I do not want to ask the same question 15 times over—obviously the minister does not accept that the legal requirements have not been followed. But I would ask him again whether or not he would at least check with the Treasurer and get his opinion about that. Why is it such a problem at this stage for the minister, as is his responsibility and the government's responsibility under existing legislation, to simply put a letter to Senator Hill asking him to rule on this issue about whether or not an assessment is needed?13:00:004279Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I think I have pretty clearly stated the government's position but, Senator, because you have raised it a couple of times—I think you have raised it 15 times—DX5MARGETTSSenator Margetts—You haven't answered the question, though. All you have done is click your pen. Can you answer the question?WW4Kemp, Sen RodSenator KEMP—Senator Margetts, you will have a chance to talk. I am trying to answer the question asked by Senator Bartlett. I will draw the remarks you made, Senator Bartlett, to Senator Hill's attention.13:00:004279Murray, Sen AndrewSenator MURRAY3M6WAAD00—One of the things we wish you to draw to the attention of Senator Hill when pursuing that issue, Minister, is the following. In the report of the Senate Environment, Communications, Information Technology and the Arts References Committee of March 1999, Inquiry into the GST and a new tax system , the executive summary at (x) states: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.It is for those and other reasons that we believe it is essential that the government pursue the proper course of action under the act to advise the Senate that it has examined the environmental issues and has come to a conclusion on them. We are concerned that, if you fail to do so, in the same way as the constitutional issue may result in a challenge so could this issue. Frankly, that quote that I have read would feature right at the centre of it. So we do need a proper response from the minister responsible.13:02:004279Harradine, Sen BrianSenator HARRADINE6H4TASIND00—I understand what the minister has said in response to the points raised by me on Friday. I raised two broad points relating to the constitutionality of this legislation. One was in respect of the GST imposition bill, and the minister's remarks have probably been more directed to that question that I asked as it related to section 55 of the constitution. But I referred to advice that I had received from the Parliamentary Library in respect of the operation of the A New Tax System (Commonwealth-State Financial Arrangements) Bill 1999 and, since then, the full Bills Digest No. 164 on that bill has been published. It was on the Net on Friday around 7 o'clock. So I wish to draw the attention of the minister and indeed the whole of the chamber to the very useful information contained in that Bills Digest .I refer to proposed subclause 10(1) of the legislation which, inter alia, says that the rate and the base of the GST cannot be changed other than with the approval of each of the states. It is a very important matter. We are talking about what the tax is going to be on and about the 10 per cent rate. The advice is that that clause could not come into operation unless there was a constitutional amendment and the procedures outlined in section 128 of the constitution were observed. Unless they were observed, the provision would be invalid and thus the Commonwealth could change the base and the rate without the approval of the states.The second point that I raised on Friday is also in respect of subclause 10(1). If that condition is really part of the imposition of the tax, it is not in the imposition bills. You have to take your choice. The provisions of the Commonwealth-state financial arrangements bills do cover a number of other things, including the fact that the significant provisions of the bill which may be invalidated are those dealing with changing the base of the GST, the distribution of GST income or revenue to the states by way of grants and the appropriation made to effect the distribution.No doubt this will be very interesting to the states. If the condition which is contained in subclause 10(1) is really part of that imposition, clearly under section 55, which requires it to be dealing with only one subject, the other provisions—namely, those relating to the disbursement of the funds to the states and the appropriations, et cetera, which are contained in that measure—would be invalid. I raise it as a serious matter. I go no further than that. But I think it is our responsibility to raise these matters. I do draw your attention to the Bills Digest prepared by the Parliamentary Library professionals on this matter.13:08:004280Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I have not looked at the Bills Digest . In the light of your comments I will draw the relevant people's attention to it. But, Senator, the government position in relation to the matters you have raised is that we believe the bills are constitutional and that section 10 does not represent an imposition of taxation.13:08:004280Cooney, Sen BarneySenator COONEYSF4VICALP00—As I understand it, when you look at a taxation law you look at whether or not the law raises that tax in a legitimate way. But following on from what Senator Harradine says, is it not the purpose of this legislation to ensure that the states have a decisive say in how much tax will be raised, and at what level and on which items the tax will be raised? Do you have any concern that that may be surrendering a power that the Commonwealth cannot surrender?13:09:004280Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—This is a separate bill which is not in the current package the Senate is now debating. I think I am right in saying that this bill is being considered before the select committee at present. So it is currently a matter which is going to be the subject of consideration by that committee. The issue of the rate changes is quite separate from that of the imposition of a tax. Due to constitutional considerations we have three imposition bills to cover each head of tax: the general, the excise and the customs. The Commonwealth-state relations bill at clause 10(1) deals with a change of rate, which of course may never happen. The point I am making is that the government believes its bills are constitutional. In relation to the bills dealing with Commonwealth-state financial relations, this is not part of the package before the chamber; this is one of the bills which have been referred to the select committee. Presumably there will be a range of matters that will be the subject of consideration at that committee.13:11:004280Cooney, Sen BarneySenator COONEYSF4VICALP00—It is a constitutional point that Senator Harradine has raised, but constitutional in the sense of the proper balance between the states and the Commonwealth. Is the minister able to point to any precedent where this sort of thing has happened—where the Commonwealth has in effect said, `Revenue will be raised but only on the say so of the states'? In other words, putting it on the basis you were putting it on, the Commonwealth will introduce a new tax—clearly, the goods and services tax—but once that tax is introduced the level and base will be varied by the states. I simply ask whether there is any precedent, any case where the High Court has upheld that situation?13:12:004280Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Senator, it will not be varied by the states. Various steps will have to be gone through before the rate is varied, and agreement of the states is only one aspect of that. Of course there has to be the agreement of the Commonwealth and presumably of the Senate ultimately. So in the end these matters would come back before this chamber. You asked me whether there was any similar precedent for this. I would have to check that, Senator. I make no claims to being a legal expert in these areas but I will seek advice to see whether I can point to any similar precedent. I am not aware of one.13:13:004280Murray, Sen AndrewSenator MURRAY3M6WAAD00—I am not all that happy about the minister's responses on this threshold question of the Constitution. I do not intend to pursue the matter much more if I do not have support around the Senate—and perhaps I would like to hear from other members on the crossbenches. Minister, I would like to hear from you as to why I should not consider moving a motion in this committee stage that after the close of business on Wednesday the 28th—that is, tomorrow evening—the Senate should agree to delay all consideration of tax bills as per the new tax system until the government provides a detailed supplementary memorandum explaining why these tax bills do not offend section 55 of the Constitution, with particular attention to the fact that these tax bills are being offered as a system, are debated cognately and have been marketed as one package. Any possible liability to the Commonwealth in the event of these bills being found to be unconstitutional should be clearly identified. Minister, in view of the concerns expressed by Senator Harradine and Senator Cook—which are presumably shared by other persons—why should I not move an amendment to oblige the government to provide a detailed supplementary explanatory memorandum on this issue or we will not consider your bills any further?(Quorum formed)13:16:004281Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I have given you the assurance that the government believes these bills are constitutional. You are entitled not to accept my position, but I have given you the government's position. Frankly, if you move such a motion, I think it would be seen as a delaying tactic. I think we are seeing attempts this morning, with these constant quorums being called, to delay this important debate. Equally, there will undoubtedly be many things, in the course of the debate that we will have over the next few days and maybe weeks, on which you and I will profoundly differ. I hope there are not too many, but there may be a number. My hope is that, as the debate continues, we will perhaps persuade you to see the merit of the government's position.I have given you assurances in this chamber about the government's position. If you do not believe me, that is a choice you have to make, but I think that any attempt to delay these bills further would be judged harshly by the wider community. These bills have had an extensive committee inquiry—the most extensive committee inquiry in parliamentary history. You were an important part of that committee inquiry. We had committees inquiring into whole aspects of these bills. The government has facilitated this. I suspect, Senator, that if you are determined on a course of action, there is not much that anyone can do—but the wider community thinks this is now the time to debate the bills. It is now the time to make sure that the bills are given proper consideration. You have asked me about the constitutionality of the bills, and I have provided you with an answer. The government believes the bills are constitutional. If you do not accept that, I am sorry—but that is the government's position.13:18:004281Murray, Sen AndrewSenator MURRAY3M6WAAD00—Minister, this is not an attack on your personal integrity and your word, as you would understand. The difficulty for us is that the constitutional issue is a threshold issue. Tax bills have been challenged before. I think in 1990, for instance, the states successfully challenged the constitutionality of tax bills at that stage. If these tax bills were challenged, and it was after the effort had been put into implementing the new GST system by business, you could see a situation where business had incurred between $1.9 billion and $2.7 billion worth of costs. If these tax bills were successfully challenged on constitutional grounds, then it is my belief the government would be at some risk in terms of liability, and the exercise would have been unnecessarily entered into.We have asked you a series of questions and you have declined to table the advice that you have received. That is fair enough, but I specifically suggested that the Senate could give you the time—until close of business on Wednesday—to provide a detailed supplementary explanatory memorandum explaining why these tax bills do not offend section 55 of the Constitution. As you know, as a minister of the Crown, an explanatory memorandum has far more weight in matters of law than does Senate debate—although I appreciate that the courts, by precedent, will have regard to what the minister has to say. Nevertheless, an explanatory memorandum is far more reassuring.Really, we are not seeking to say that you have to provide advice from your legal advisers. I am suggesting that you should provide a far more formal response to the Senate than you have given so far, because you have declined to give substance, if you like, to it. You have simply said, `This is not unconstitutional; there have been a number of tax cases,' and, `You must trust us.' I am sure I am able to trust you personally, but we are talking about between $1.9 billion and $2.7 billion worth of costs which will be imposed on business, and we cannot take a risk with that. I am not going to pursue this further if I do not get support around the chamber but, really, what I want from you is that detailed supplementary explanatory memorandum.13:21:004282Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Senator, I think a fair reading of the debate that occurred last Friday afternoon shows that it was not a matter of just relentlessly arguing that the bills are constitutional. I think there was a very active debate between Senator Cook and me about the nature of section 55 and how courts have interpreted it before. I said the cases that Senator Cook quoted gave considerable comfort to the government's position, not to the position that Senator Cook was arguing for or, indeed, the position that you are now putting. I think a fair reading of that debate shows that there was a debate in some depth on this issue. Before you move any motion, Senator, I urge you to go back and read more carefully what was said in that particular debate.I think I have fairly answered the questions. There were a number of issues that Senator Harradine raised. He referred to the Bills Digest. That had not been drawn to my attention. I said that I would have a look at the Bills Digest. I think I have fairly answered the questions that have been put in this chamber, but obviously not to your satisfaction. I urge you to reread, if you can bear to, the evidence that was given on Friday. You will see that there was quite an extensive debate, an important debate, about the constitutionality of the bills, particularly in relation to section 55.13:23:004282Sherry, Sen NickSenator SHERRYZW4TASALP00—On behalf of the Labor opposition, I indicate that we are certainly interested in your proposal, Senator Murray. We are interested because at this stage—in listening to the debate on Friday and this morning and to Senator Kemp's response—I am sure that Senator Kemp has not even told us whether they have had advice about constitutionality. We do not even know that at this point in time. I do not think Senator Murray's proposi tion is unreasonable, given the importance of this package. Even the government claims this is some sort of monumental tax reform—the greatest tax reform that Australia has ever seen. I do not think it is unreasonable that we should be able to see the legal advice to verify whether or not the package we are dealing with is constitutional. It is a critical threshold issue, as Senator Cook has said, as Senator Murray has said, as Senator Harradine has said, and as my esteemed colleague and legal expert Senator Barney Cooney has said.1I4McKIERNANSenator McKiernan—Learned colleague.ZW4Sherry, Sen NickSenator SHERRY—Learned colleague as well. I was not going to touch on the super tax issue, but I have to touch on it. Let us briefly reflect on the government's major tax reform of its last term of office. That was the super tax—the half a billion dollar tax that we were not going to have but we ended up having.DX5MARGETTSSenator Margetts—What did they say about advice at that time?ZW4Sherry, Sen NickSenator SHERRY—That is right. I wanted to remind the chamber of this. We were assured by you, Senator Kemp, the Treasurer and the Prime Minister that that major super tax reform was constitutional. We were assured of that. What happened? I can recall a Senate select committee hearing—these are the Senate hearings that Mr Costello says are a waste of time—receiving advice from none other than Dennis Rose QC. I understand he is one of the top QCs in the country. He is a former Solicitor-General and a top quality lawyer in this country. He came along to the committee and said that your super tax was unconstitutional. Of course, we all know what happened. Mr Costello, Senator Kemp and the Prime Minister were all up in arms, saying, `Accept our assurances. The super tax is constitutional. Please accept our word. We are not going to give you any legal advice, but accept our word that it's constitutional.'Then what happened? As I recall it, a couple of weeks later Senator Kemp came into the Senate chamber and announced some minor technical amendments and enhancements. I think you used the term `enhancements'. They went to the constitutionality of the super tax. There were amend ments presented in the Senate not to put beyond any doubt—because there is still doubt—but to improve the constitutional basis on which the super tax was to be implemented. It was a massive backdown by Senator Kemp that was referred to as `enhancements' and `minor technical amendments'. It was a massive backdown by the government.It is interesting because this was the only other occasion on which the government presented us with a major proposal for tax reform—the introduction of the super tax. Of course, that is not the end of the story on the super tax. I do not know whether senators are aware of it, but challenges are being presented in respect of the legality of the super tax. I remind the Senate that it was only two weeks ago that Senator Ferguson, who is in the chair at the moment, put a dorothy dixer to Senator Kemp about the super tax. There were two issues: one related to the advance instalments, and the other one went to some minor technical amendments. We have not seen this legislation yet, but Labor has a strong suspicion that these minor technical amendments—the second wave of the minor technical amendments—to the super tax actually deal with some of the challenges that are before the courts that go to the constitutional validity of the super tax. I have been reliably informed of that by some legal advisers who have a longstanding interest in the super tax.I refer to this issue because this was the only area of major government reform in respect of increases in tax in the government's last term of office. It is a shambles for a whole lot of reasons, but one of the specific problems was the constitutional basis. We received assurances then from Senator Kemp, the Treasurer and the Prime Minister, but they were not correct. Dennis Rose QC, former Solicitor-General, shot them down in flames on that issue. They had to rush in amendments, and we are still not sure whether those amendments have corrected the problems, or at least one area of the problems, with the super tax.Yes, Senator Murray, we are certainly interested in your proposal. We do not believe Senator Kemp has addressed the issues that have been raised by a number of senators, including Senator Harradine. On this critically important package, Labor want to see specific constitutional advice or legal advice as to constitutionality. Wouldn't it be ridiculous if we went through this debate, for however long it is going to go, and the package was passed in whatever its final form was and it was all a waste of time because it is unconstitutional? Wouldn't it be ridiculous? We do not want the government to have any more egg on its face than it has already had in respect of the super tax.WW4KEMPSenator Kemp—If anyone has egg on their face, it is you.ZW4Sherry, Sen NickSenator SHERRY—Well, I struggle to find any criticism of my position on the super tax other than that which has come from your mouth, Senator Kemp. But I can give you the names of lots and lots of organisations that have criticised your government with respect to that issue, but that is another story. I would like an indication from Senator Harradine as to his position on whether this proposal of Senator Murray's is worth exploring. I also notice Senator Margetts is in the chamber, and I assume she is speaking on behalf of Senator Brown. They are two other senators whose position on this particular proposal from Senator Murray is obviously very important.13:30:004283Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Senator, that took about 10 minutes or so. This was the senator who was desperate to get the debate going. This was the senator who said that we had to get the debate on these bills going. What is almost the first thing he says? Of course, he voted against the second reading which would have stopped debate, and now he hopes to use a device that Senator Murray has floated before this chamber which might also be a way—ZW4SHERRYSenator Sherry—We want to kill the GST.WW4Kemp, Sen RodSenator KEMP—That is right. You are not actually interested in constitutionality. You are not remotely interested in it. What you want to do is defeat the bills—that is all you want to do.ZW4SHERRYSenator Sherry—That's right. We want to kill the GST.WW4Kemp, Sen RodSenator KEMP—That is exactly right. So all this posturing about constitutionality is, in your mouth, Senator, complete hot air. You are not interested in constitutionality; you are interested in defeating the bill. I do not attribute that to other senators who have raised issues. As I said, we have listened very carefully to the points that Senator Murray and Senator Harradine have raised. But, in relation to your position, Senator, that is quite clear.In relation to the superannuation surcharge—and I guess Senator Conroy was right; it was about 96 per cent of your time on the surcharge, which is a lot of time for one senator to spend on a surcharge which affects about 2.5 per cent to three per cent of higher income people—there is no constitutional challenge to the surcharge. There is nothing before the courts which is a constitutional challenge. What you are raising is, again, just not accurate. Constitutional issues were debated in relation to the surcharge. I am sure that if people felt there was a constitutional issue, it would have been before the courts, but it has not been. So, on that issue, Senator, you are quite wrong.On the other issue that was raised, the community wants these bills debated. We have now been through a most extensive committee hearing. I am not aware of any constitutional lawyer who came before that committee—and there was plenty of time to produce evidence—who produced evidence which argued that the bills were not constitutional. The bills, let me remind you, were tabled in the other place in the early part of December, and this has now arisen. The Senate is quite entitled to ask a minister to provide assurances that the bills are constitutional, and that is exactly what I have done.We have adopted the general view that turned your government. I am sure that, if I wanted to get my staff to dig out all the discussions that ministers under your government had about tabling legal advice, I could produce a wad of material to argue that that is the case, but I am not sure that that advances the position. The situation is that you have asked me whether the bills are constitutional, and I have given you the government's position. The government is very aware of constitutional issues in drafting these bills.I think that now is the time for the bills to be debated. You may not think they are constitutional, but that is not the government's position. The government's position is that the bills are constitutional. It is our view that it is now time for these bills to be debated and not delayed by one ruse or another. Senator, it is not surprising that you have attempted to jump on this bandwagon. People will contrast the statements you have just made with all the statements you made for 48 hours about demanding that the bills be debated and bringing on the debate. What you want to do, if you can induce Senator Murray to move this motion, is to stop the debate.13:34:004284Margetts, Sen DeeSenator MARGETTSDX5WAG(WA)00—It might be true that some members of the community want to hear the debate, but I think it would be true to say that the same members of the community, or an even wider section of the community, would be expecting that the government would be responding—not just foiling, not just debating but actually responding—at this stage to the kinds of issues that are being brought up. There have been two that have been brought up so far: one is whether the government has followed the correct legal requirements in relation to environmental referrals for such a major change, which quite clearly has been presented as posing a problem for the environment; and the other one is whether or not government committee members were given instructions to accept that.That has clearly been brought up as a major issue. The question was asked whether or not the government have followed the proper legal process. Clearly, the minister fobbed, foiled and did not answer that question. Before that, the government were asked whether or not we could be reassured in some written form about the constitutionality of the bills. Once again, the government are fobbing and foiling and creating the extra time. If during these three days the government had been able to come up with a piece of paper to table where someone reputable was prepared to put their name to advice to give to the chamber about the constitutionality or the reasons why the government are arguing it is constitutional, I guess that would mean we could go on to the next topic.But so far what we have is this: the government have two major issues before we start debating these bills and have failed to respond in any positive way or table anything specific which will deal with these problems. It is not unreasonable, it is not unprecedented and it is fairly normal for the chamber to ask for these reassurances in writing, not just as a debating point. The government say, `No, we've said it's constitutional, so that should be good enough for you.' We know that that does not actually mean a great deal unless somebody is prepared to put their name to that advice.These are major issues. If, as government members have told us, certainty is important, then this is the very least that they could suggest to the community. They have moaned about the amount of time that this will take up in relation to the bill. It will waste a heck of a lot of time if we don't have these issues dealt with when it is most convenient to do so, which is now.13:37:004285Cooney, Sen BarneySenator COONEYSF4VICALP00—I have three questions for the minister. Firstly, is it the intention of the government that any legislation to change the rate of the GST and the base of the GST be done in conjunction with the states? Secondly, is this money, when collected, going to go to consolidated revenue or will it go directly to the states? If it goes to consolidated revenue, how long will it remain in the consolidated revenue fund? Thirdly, am I correct in saying that it is not intended that this money be used to pay any state debts; it is the intention that this money end up in the consolidated revenue of the states?13:38:004285Sherry, Sen NickSenator SHERRYZW4TASALP00—Whilst Senator Kemp is attempting to deal with that issue—I notice he is going over to the advisers yet again—I just want to respond very briefly to a couple of the points that he has made. Senator Kemp is right in at least one thing: Labor wants to see the GST legislation voted down. But the constitutionality—and the issue that Senator Harradine raised, for example, with respect to the alleged mechanism to prevent the increase in the rate of the GST—is but one of Labor's fundamental concerns. Senator Harradine has raised that important point. Labor wants to see the legal advice that the government has with respect to the alleged locking in of the GST rate of 10 per cent.The Liberal government argued in the lead-up to the election, `We have locked it in at 10 per cent unless the states agree to a change.' Apparently that is false. One of Labor's fundamental concerns about a goods and services tax, among a whole range of other issues, is that the GST always goes up. I do not need to recite the endless number of examples from places around the world where the GST has been introduced. There are assurances given that it won't go up and what happens? A few years later—it varies from country to country—the GST is put up. Senator Harradine quite rightly raises the legitimate point that the so-called assurance that the states will have to unanimously agree in order for the GST to go up is not worth the paper it is written on. It is a very legitimate legal and constitutional point.My attention was drawn to the case of Japan. Japan introduced a GST four or five years ago. Assurances were given like the assurances the Liberal government has given. This was going to fix all Japan's problems. It would cure unemployment, cure the current account, lead to improved economic growth and lead to improved efficiency. All the mantras and the propaganda that Senator Kemp has been reciting about the GST were given in Japan. They started off with a GST rate of three per cent when it came in four or five years ago. Then two years ago they upped the rate to five per cent. This is central to this debate and central to the concerns that Labor has. I might say in passing that upping the rate of the GST from three per cent to five per cent has not made things any better in Japan; it has made things worse. Consumer confidence has been destroyed, the economy is still in decline and there has been no improved efficiency.So the issue of the alleged lock-in rate, holding the GST at 10 per cent, is very important. It is one of the critical issues that Labor has grave concerns about and an issue on which the Liberal government blatantly misled the Australian electorate in the lead-up to the last election. They assured the electorate that the rate of the GST was locked in unless all the states agreed to increase it. As Senator Harradine said last week, `Never get between a premier and a bucket of money.'6H4HARRADINESenator Harradine—It was not original.ZW4Sherry, Sen NickSenator SHERRY—No, I think you correctly attributed it to a former distinguished Prime Minister, Mr Keating.6H4HARRADINESenator Harradine—I have bitten my tongue ever since.6L6GIBBSSenator Gibbs—It's the truth.ZW4Sherry, Sen NickSenator SHERRY—No need to bite your tongue, because it is the truth. On this occasion Mr Keating was spot-on in his assessment of the premiers and their want for money. Whether they want the money or not, the fact is that the undertaking to lock the 10 per cent GST in is not worth the paper of the bill that it is written on.I conclude my remarks by reiterating, Senator Kemp: yes, we want these bills voted down. Labor will do everything to crush this legislation and the goods and services tax. We do not resile from that. The legal process to lock in the rate at 10 per cent is one element of our concerns about the GST. Labor gave a commitment at the last election that we would not support a GST. We will do everything in our power to defeat these GST bills.13:43:004286Harradine, Sen BrianSenator HARRADINE6H4TASIND00—The motion that has been floated by Senator Murray indeed has the worthy objective of enabling the government further time to consider a fundamental question as to the legality of the legislation. It is not correct for the government to suggest that raising this issue is some sort of device, to suggest that people who have entered the debate this morning but who were not in the debate on Friday are jumping on a bandwagon. Those are descriptions which are not really worthy of the minister. All that Senator Murray is trying to do is give the minister and the executive government a further opportunity to re-examine their advice on the constitutionality or otherwise of this measure.In the end, however, the Senate's role in this matter ends there. It is the executive government which must carry the can. In giving this assurance, I assume that the minister is speaking on behalf of the Attorney-General. I have reiterated this morning the fact that we now have the Parliamentary Library's Bills Digest. That is a matter the minister should also consider, and he has said that he will.I would like to see an additional supplementary explanatory memorandum. But if the government chooses not to provide one and the minister then stands up in this chamber and says, `On behalf of the government'—and presumably, more specifically, on behalf of the Attorney-General—`I assert that, after having considered all of the matters, this is in our view constitutional,' then that is the executive government's decision. But the executive government will have to carry the can, and I would suggest that it is a very substantial can. A huge cost is involved, particularly to small business. Also, whilst the government would be carrying the can, the taxpayer unfortunately would be liable to pay for it.In the end, the Senate has certain responsibilities only. We have raised this matter with the executive government. Under those circumstances, I suggest that it is at least premature, and I think we have indeed come to the end of trying to cajole the government into having a really good look, a second look, at the matter. Under those circumstances, I commend Senator Murray for raising the matter; he has done so not as a device to delay debate on this matter but because it is an issue that concerns him. I congratulate him for raising it, but I would not be able to support it if it came to a vote.13:47:004286Cooney, Sen BarneySenator COONEYSF4VICALP00—I have an additional question to ask of the minister which can be added to the others I have put forward. My additional question is apropos of not being able to get hold of legal advice—and I know, as you say, that is the practice.I think this issue of constitutionality is correct. For example, Minister, have you looked at the question of how the second reading debate speeches may now become relevant? In the first uniform tax case, the court held that you were not to look at the minister's speech and you were not to look at the debate. Given that, what difference do you think the amendments to the Acts Interpretation Act have made where these matters can be looked at? With our being unable to get a look at the opinions you have obtained, these are the sorts of issues that really do come forward and, I think, give this chamber some concern.13:48:004287Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Senator, in relation to the last matter, my understanding is that, since that issue was raised, the Acts Interpretation Act has changed.SF4COONEYSenator Cooney—It is still relevant.WW4Kemp, Sen RodSenator KEMP—I think second reading debate speeches are looked at, or can be looked at.SF4COONEYSenator Cooney—That is the point.WW4Kemp, Sen RodSenator KEMP—Let me go through some of the comments that were made. Senator Margetts, the government has followed proper legal processes, and I have stated that. It is not correct to say that I ducked and weaved.DX5MARGETTSSenator Margetts—You did not say what they were, though.WW4Kemp, Sen RodSenator KEMP—If you read, Senator—Senator Margetts interjecting—WW4Kemp, Sen RodSenator KEMP—You said that I ducked and weaved; I have said that I did not duck and weave. I stated quite clearly that, in relation to matters that were raised by Senator Bartlett and Senator Murray, Senator Hill took a very close interest in these bills—DX5MARGETTSSenator Margetts—Okay. Can we have a letter from him?WW4Kemp, Sen RodSenator KEMP—Let me finish my remarks, Senator—and, through the cabinet processes, he was obviously very much acquainted with the bills and the sorts of issues that you have raised. Because Senator Bartlett came back to the issue, I have said to him that I would draw his remarks to Senator Hill's attention. In light of the comments that Senator Bartlett made, I think that is the courteous and appropriate thing to do.Senator Cooney has raised a number of issues. The GST revenue goes to consolidated revenue, and I think that is made fairly clear at page 11 of the A New Tax System (Commonwealth-State Financial Arrangements) Bill 1999. Then GST revenue grants are made to each state. The timing from consolidated revenue I do not think is relevant; the timing of the payments is an administrative matter between the Commonwealth and the states. But I make the point that this bill has now been referred to the select committee for further examination and discussion. I make the point that it is not a bill which is actually before this parliament.Senator Sherry made an impassioned speech. Senator Sherry, you have stated the obvious: the Labor Party wants to defeat these bills at all costs. I have stated that also. To that extent we are in blazing agreement. It is nice to have at least one aspect on which we are in blazing agreement.ZW4SHERRYSenator Sherry—There it ends.WW4Kemp, Sen RodSenator KEMP—You were very concerned about lock-in, as indeed the government is.ZW4SHERRYSenator Sherry—Senator Harradine is.WW4Kemp, Sen RodSenator KEMP—This is why we have a mechanism.ZW4SHERRYSenator Sherry—A bodgie mechanism.WW4Kemp, Sen RodSenator KEMP—There is no mechanism that you have come up with to lock in the wholesale sales tax. The wholesale sales tax can be raised—FX5MURPHYSenator Murphy—You have not come up with one either; that's the problem.WW4Kemp, Sen RodSenator KEMP—You have made no contribution. If you want to make a contribution, stand up and make one.FX5MURPHYSenator Murphy—That is the problem.10000TEMPORARY CHAIRMANThe TEMPORARY CHAIRMAN (Senator McKiernan)—Order! Senator Murphy.WW4Kemp, Sen RodSenator KEMP—With the Labor wholesale sales tax, of which you are particularly enamoured, there is no mechanism to lock it in.FX5MURPHYSenator Murphy—You're right about that; there isn't one.WW4Kemp, Sen RodSenator KEMP—There isn't one. I do not know whether you are thinking of developing a lock-in mechanism, Senator, like you were thinking of developing an alternative way of collecting the superannuation surcharge. Nothing ever happened there. We recognise that there are genuine issues that have been raised. I have tried to answer them in detail. As I said, Senator Harradine has brought my attention to the Bills Digest and I will look closely at that digest.13:53:004288Murray, Sen AndrewSenator MURRAY3M6WAAD00—I thank honourable senators for their guidance on that matter. I am not going to pursue my suggestion any further. I want to say to the minister that I was personally surprised at the strength and vigour over the decades with which citizens, organisations and businesses pursued the excise issue. They must have always known that the Commonwealth, if faced with that eventual constitutional ruling, would act to keep the status quo. That is exactly what happened. Yet they must have spent millions over those decades pursuing an issue which really got up their noses about how the state taxation system was managed and run.Again and again the government has said that this is a new tax system and the largest tax change measure for 30-odd years, or perhaps longer—since the war. I know from some of the correspondence I am getting that there are people who are incensed about it. I would prefer, as a senator, that these issues not be pursued in a court of law. I would prefer that the issues be resolved prior to that, because that involves the Commonwealth in an unnecessary defence of its position. I am merely saying that I am afraid your approach to this particular question raised by Senator Harradine and carried on by other members of the Senate will not be helpful if in the end, as I suspect, this package of bills is pursued at law, as people are already threatening to do in correspondence to me and probably to other senators.13:55:004288Margetts, Sen DeeSenator MARGETTSDX5WAG(WA)00—It is a general question, but I will get to the specifics when we move to other bills. I would like to ask the minister whether we are going to be given any directions about what is going to happen to the large section of the Customs Act which gives specific directions as to how the current diesel rebate is dealt with. This package has been put together very quickly. One of the concerns that we have in putting our amendments together is that we have discovered there is not sufficient instruction in the bill to let us know what will happen in the interim. What will happen to the whole section of the customs bill? What will be the interim arrangements? Is it likely that we will put through a section or bills and be left without any clear directions as to what alternative arrangements will be made?13:56:004288Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Once the bills are passed, there will be a range of consequential amendments after 30 June to tie up those arrangements.13:56:004288Margetts, Sen DeeSenator MARGETTSDX5WAG(WA)00—That seems absolutely extraordinary. Remember that the government said, `This is the package. Take it or leave it.' Now we are being told that there will be a massive change, and we are going to be left in the air as to the actual working out of things. It is not as though this is in regulations. We will be left in the air as to how this is going to work on the ground. We can expect another bill after this to deal with how diesel is going to work. It is so vague in the package that we are being asked to accept.13:57:004288Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—We have to have these bills passed before we can deal with the consequentials which I mentioned in relation to other acts. This is the fundamental package, and that has to be passed. But all these things come before the Senate.13:57:004288Sherry, Sen NickSenator SHERRYZW4TASALP00—I want to raise the issue that Senator Kemp responded to this morning, and that was the matter of the supplementary explanatory memorandum and the financial impact of the explanatory memorandum. In that explanatory memorandum it refers to the financial impact of the 128 amendments as being negligible or nil. I would like Senator Kemp to point out whether the amendment in respect of the sugar industry matches the claimed cost that the sugar industry gave in a submission before the select committee in Brisbane. Does it match the cost that the sugar industry was concerned about? Where is the minister? I am concerned that the minister is not here. I posed a question. He is asking for cooperation. We are trying to get through the tax bills. Oh, here he is, at last!N26ABETZSenator Abetz—What a cheap comment.ZW4Sherry, Sen NickSenator SHERRY—There is nothing cheap about a GST, Senator Abetz. We will be doing everything we can to knock this legislation over. That is the commitment we gave the people of Australia. Senator Kemp should be here to deal with it.13:59:004289Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—The amendment was already in the forward estimates. This was the measure that was costed on the sugarcane railways receiving a full rebate.Progress reported.Questions Without Notice428942894289Collins, Sen JacintaSenator JACINTA COLLINSGB6VICALP00—My question is directed to Senator Kemp representing the Treasurer. Why is the government giving 50 per cent of its proposed tax cuts, well over $6 billion a year, to the wealthiest 20 per cent of households while offering less than one-third of that amount to the bottom 20 per cent? Does the government accept that this will inevitably increase the gap between high and low income households?4289Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—The government makes no apology for giving arguably the largest tax cuts in Australian history—let me make that absolutely clear—which the Labor Party wants to stop, is determined to stop. The government's tax reform package is designed to ensure that all Australians share in the benefits of tax reform. In addition to significant income tax cuts, Australians will benefit through greater assistance to families, improved work incentives and pensioner benefit increases.By July 2000, the top 20 per cent of Australian taxpayers will contribute about 57.2 per cent of the personal income tax revenue. Following the introduction of the new personal income tax scales, the contribution of this group will rise to 58 per cent. In contrast, the bottom 40 per cent of taxpayers, who will contribute 8.7 per cent of personal income tax revenue by July 2000, will see their contribution fall to 8.2 per cent. Over 80 per cent of taxpayers will face a top marginal tax rate of 30 per cent. Currently, only 30 per cent of taxpayers have a top marginal tax rate of 30 per cent. That is why these bills are very good for taxpayers and, we believe, represent massive tax cuts for Australians. Lower and middle income earners, in particular, will keep a higher proportion of the earnings they receive after tax. This will provide them with greater rewards for their work and saving efforts and improve incentives to better their financial position through overtime, promotion and training.This is an excellent package that has, as one of its key features, massive tax cuts for Australians and it is a great pity that the Labor Party are opposing it. I would have thought that we have received the mandate to deliver these tax cuts, and what we say to you, Senator, is, `Make us keep our promises.'4289Collins, Sen JacintaSenator JACINTA COLLINSGB6VICALP00—Madam President, I ask a supplementary question covering what the Minister did not deal with in his answer. Where is the fairness in giving high income households three times as much as that being offered to low income households?4289Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Senator, it is a great pity that you did not listen to the answer, as often happens. The supplementary question is always written out and no-one bothers to listen to the answer. Low and middle income taxpayers, in particular, will keep a higher proportion of the earnings they receive after tax. We believe this is a fair tax package. We believe Australians want their income tax cuts. We think the personal income tax rates are too high and we want those to be cut. We want these tax cuts to be passed through this Senate so we can deliver these major benefits to Australian taxpayers.42894289McGauran, Sen JulianSenator McGAURANWH4VICNP10—My question is directed to the Minister representing the Minister for Employment, Workplace Rela tions and Small Business. Will the minister inform the Senate how the government is helping small business get on with business and how its new tax plan will reduce compliance and operating costs? Is the government giving serious consideration to any alternative tax reform proposals?4290Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—If there is one thing small businesses have quite rightly complained about over the years, as Senator McGauran would well know, it is the fact that there is an enormous amount of red tape and there is mindless complexity in a number of the taxation measures. Quite often, they raise relatively only small amounts in themselves from each small business, but they require an enormous amount of time and effort which could otherwise be devoted to actually getting on with the business of business. So it is particularly significant that the new tax system will abolish a whole raft of taxes and introduce a much more simple approach. A new, single comprehensive pay-as-you-go system will replace the current separate and confusing payments. Small business will have only one tax instalment and most will need to make only one net payment each quarter. That is a vast improvement on the current system.Despite all the scaremongering from the other side about the complexity, we heard recently from the President of the New Zealand Employers Federation, who runs two medium sized businesses, that it takes him only about 20 minutes every two months to do his GST returns. You could not get something more straightforward than that—that is a dream in terms of compliance. That is precisely the sort of benefit that will flow to small business from this new regime.Madam President, because of the fact that this is not a tax on business—indeed, it makes a tremendous difference to business to have something like $10 billion worth of costs removed—it provides an enormous and unique opportunity to be a jobs generator. That is really what we ought to be concerned about, but unfortunately on the other side this is all a matter of political advantage. Did anyone happen to get in here a few minutes before question time and hear Senator Sherry getting hysterical about what an outrageous and appalling tax system this would be? Are they going to oppose it if it is in place next time around and they win government?UNKNOWNGovernment senatorsGovernment senators—No!LD4Senator ALSTON—No, of course they are not. They will take it, thank you very much, with both hands and you will not hear a whimper out of them. It is a classic example of political duplicity. Their poor, unfortunate, pro tem leader basically let the cat out of the bag last week on radio when he said:We will oppose this as effectively as we can, as people who know a bit about politics and give the defeat of the GST its best shot.In other words, this is all about politics; this is not about policy. This is about trying to wring out every negative vote they can get by running all sorts of scaremongering campaigns even though they know the rest of the world went down that track long ago. It is eerily reminiscent of Telstra. The Labor Party wants us to be the last cab off the rank in terms of policy until they are in government, and then, of course, they could not do it quickly enough.Let us not be under any illusions about what is going on here. That highly paid flunkey, Senator Conroy, referred the other day to an unpaid flunkey. I will give you a very highly paid flunkey, Mr Bernie Fraser, whose simply asks, `How high do I have to jump?' Of course, Mr Fraser was in favour of a GST a few years back, but now he takes his riding instructions from the Labor Party and he is doing absolutely everything he can to rewrite the Evatt Foundation report on his own, so that he can get up at the National Press Club and call in a few more dues from the Labor Party, so that if and when they ever get back into government they will appoint him to a whole raft of well-paid positions.Mr Fraser has managed to sideline all the people of integrity who actually think it is not a bad idea—people like Allison McClelland and John Freeland—people who do have something of an open mind on this subject. They will be pushed to one side so that Mr Fraser can carry out the role of Labor lap-dog. (Time expired)42914291Cook, Sen PeterSenator COOKRF4WAALP00—My question is to the Assistant Treasurer, Senator Kemp. Has the minister seen claims by the Prime Minister that by the financial year 2005-06 the GST package will make the states $2.9 billion better off? Does this $2.9 billion include revenue from a state tax entitled `non-residential conveyancing duty'? If so, can the minister confirm that the GST growth component is in fact only $1.1 billion? Can the minister also confirm that the figure of $17 billion quoted by Senator Alston last week includes continuation of non-residential conveyancing over the entire decade to the year 2010?4291Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—We were delighted, of course, with the response from the state premiers on the signing of the really historic agreement between the states and the Commonwealth on their financial package. In fact, the only people who are complaining about it are the Labor Party.YW4MACDONALDSenator Ian Macdonald—The federal Labor Party.WW4Senator KEMP—Federal Labor is the only party which is complaining about this agreement. In a number of quotes, Mr Carr said that the government had a mandate to pass this package through. He said that he would send a special emissary, Mr Della Bosca, to attempt to get this package through the parliament. Mr Bacon, the Premier of Tasmania, also commented that, in his view, this was quite an historic agreement; and, from memory, they left the negotiating table very happy.Equally, Premier Beattie, another Labor Party Premier, also announced that as far as he was concerned the government had a mandate for this package and he went away particularly happy with the additional funds given to Queensland. The federal Labor Party is the only party. Its state divisions support the package. The state divisions cannot wait for this package to go through the parliament.I wonder why we are having this constant nitpicking from Senator Cook. I have nothing to add to the comments that were made in this chamber last week by Senator Alston and comments made by the Prime Minister.4291Cook, Sen PeterSenator COOKRF4WAALP00—Madam President, I ask a supplementary question. I note the minister did not answer one of my questions at all, or any of my questions at all. Again, I ask the minister: is it not the case that most of the Prime Minister's $2.9 billion growth tax for the states in fact derives from an existing state tax, that is, the non-residential conveyancing duty? Wasn't the Prime Minister just plain wrong last Friday when he answered a question asked by Neil Mitchell on 3AW as to whether the $2.9 billion excluded that state tax by saying, `Yes, oh yes, yes'? Wasn't the Prime Minister also wrong in asserting to Neil Mitchell that the states `don't get the GST' unless they abolish this and all the other taxes in the intergovernmental agreement? Minister, would you mind answering those questions?4291Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—Senator Cook has to answer why the Prime Minister was constantly patted on the back by Labor Party premiers, who, I might say, felt they had an absolutely excellent deal. The senator can raise a whole host of nitpicking issues, but the important thing is that Labor Party premiers are delighted with the deal that was struck in Canberra.42914291Payne, Sen MariseSenator PAYNEM56NSWLP10—My question is to the Minister for Family and Community Services, Senator Newman. Would the minister please outline the benefits that will be received by pensioners and retirees with the introduction of the tax reform package and, in addition, how the advance indexation of pensions will act as a safeguard against price increases?4291Newman, Sen JocelynSenator NEWMANBE4TASLPFamily and Community Services; Minister Assisting the Prime Minister for the Status of Women10—I thank Senator Payne for the question because a prime concern of this government all along has been that pensioners and retirees receive their fair share of the benefits of the tax reform measures.3L6CONROYSenator Conroy—You are desperate.BE4Senator NEWMAN—Pensioners will receive a four per cent increase in their pension rate up-front on 1 July 2000, before any tax changes and any price changes, and they will be able to keep more of the extra income that they earn by being able to keep 60c of every extra dollar rather than the existing 50c. Pension payments will always be at least 1½ per cent higher than they would have been under the current cost of living adjustments. In addition to this increase in the real rate of pension, the government will also ensure that the single rate of pension does not fall below 25 per cent of male total average weekly earnings.3L6CONROYSenator Conroy—They intersect.BE4Senator NEWMAN—This coalition government legislated to ensure that this additional MTAWE protection was provided, unlike the Labor Party. Keeping the pension at at least 25 per cent of male total average weekly earnings means that pensioners also share in rises in living standards of those in the work force.3L6CONROYSenator Conroy—You can run but you can't hide on it.10000PRESIDENTThe PRESIDENT—Order!BE4Senator NEWMAN—As well, pensioners and retirees may be eligible for bonus payments of up to $1,000 or $3,000 respectively, depending on their income and their savings. An additional 45,000 current self-funded retirees will become eligible for age pensions due to the relaxation of the pension income and assets test.3L6CONROYSenator Conroy—Greg Smith blew the whistle on this.BE4Senator NEWMAN—That gives them access to pensioner concession cards and all the associated benefits that come with those. Also in the tax reform, pensioners and seniors generally will benefit from lower income tax rates; a higher tax threshold, replacing scales that have been in place since 1993; refundable imputation credits; and abolition of sales tax, financial institutions duty, bank accounts debits tax, various stamp duties and bed taxes.3L6CONROYSenator Conroy—Greg Smith blew the whistle on this. The deputy secretary of Treasury has blown the whistle.BE4Senator NEWMAN—Most importantly, pensioners and low income retirees will not pay a cent of taxation until their income reaches $14,500 for a single person or $24,500 for a couple. That is very significant. Doesn't that just contrast with Labor's appalling record? We all remember the Labor Party introducing an increase in wholesale sales tax of two per cent in 1993, expanding the range of items covered—including fruit juice—over three years. Then they increased the amount of fuel excise by up to 7c a litre in 1993—all without compensation—during their time in government. There was not a cent of compensation, and yet we see the Uriah Heeps wringing their hands now. In the last election, just remember, they threatened taxing the pre-1985 assets for capital gains—a direct attack on pensioners and retirees. So any pensioner or retiree that listens to their weeping on behalf of pensioners should take a reality check.3L6CONROYSenator Conroy—What about what Greg Smith said?10000PRESIDENTThe PRESIDENT—Order, Senator!BE4Senator NEWMAN—We have been very supportive of pensioners and retirees and we are determined to continue to protect them, and the measures that I have outlined are ones that will protect them into the future.3L6CONROYSenator Conroy—Greg Smith doesn't believe you are protecting them.BE4Senator NEWMAN—There have been many initiatives that this government have introduced in the just over three years we have been in government which are meaningful and helpful and practical to older people.LI4PATTERSONSenator Patterson—Madam President, on a point of order: Senator Conroy has been constantly interjecting. In calling him to order, I ask you to ask him to desist from interjecting on Senator Newman.10000PRESIDENTThe PRESIDENT—I think Senator Conroy knows that he is in breach of the standing orders.BE4Senator NEWMAN—Perhaps I can quickly list some of these things: the Commonwealth seniors health card expansion to up to 220,000 retirees, expanding initiatives for carers, and retirement assistance to farmers. (Time expired)42934293Evans, Sen ChrisSenator CHRIS EVANSAX5WAALP00—My question is directed to Senator Herron, the Minister representing the Minister for Aged Care. Can the minister confirm that, under the arrangements to protect the GST compensation paid to pensioners in residential aged care, providers will lose $50 million a year when, as Treasury officials have conceded, that compensation erodes to zero? Is the minister aware that under the tax package providers will only receive 81.5 per cent of the pension paid to residents, down from the current 85 per cent, to provide basic daily care to residents? Isn't it a fact that most nursing home residents who are pensioners are cared for by non-profit community service operators such as Catholic health care? When the compensation does erode, isn't it the case that this change will result in providers receiving $12 a fortnight less per resident to provide that basic daily care, inevitably leading to reductions in the quality of care provided to older Australians?4293Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—I thank Senator Evans for the question, and the answer to the question is that I can confirm that the rates of assistance will be reduced. Currently, the basic fee is 85 cents in the dollar for the maximum single rate age pension and, while the pension is being increased by four per cent as a compensation measure, the basic fee will not raise. So, effectively, the fee becomes 85c in each 104c per pension. Accordingly, the proportion of the pension represented by the fee falls from 85 per cent to 81.5 per cent. If you listened to what Senator Evans said you would get the impression that there is a massive reduction. In fact, statistically there is a reduction but the compensation mechanisms—GB6COLLINSSenator Jacinta Collins—Ha, ha!VW4Senator HERRON—Senator Collins may not understand it. Obviously she does not because she laughs. There is a four per cent increase in the full age pension, and increased rates of assistance will be provided to ensure the recipients receive a real increase in their pensions of 1.5 per cent, thereby enabling them to receive a fair share of the benefits of the new tax system. Providers will be limited by legislation—Senator Chris Evans is play ing with statistics here—to charging only 81.5 per cent or face the possibilities of sanctions being imposed if they exceed this amount. So there will be sanctions imposed. But, on the other hand, of course the providers will be compensated because they can claim all GST taxed items that are input items, so the cost of providing services will be decreased.It is obvious that the Labor Party have not addressed their understanding of the new tax reform system and do not intend to. They are bringing up these spurious items to scare the public. It is a scare campaign once again. The pension increase will see single age pensioners receiving an extra $15.50 per fortnight and pensioner couples an extra $25.50 per fortnight, which is a large increase in income for older Australians. This increase lifts the full pension rate above the minimum level of 25 per cent of male average weekly earnings that is already guaranteed in legislation by the government.The implication of Senator Evans's question was that the providers will be worse off. If the providers are so much worse off, why is it that in Queensland people are now attempting to buy bed licences for $30,000 each? If they are facing this desperate situation where the providers are going to be worse off, why do they want to spend $30,000 a bed?I suggest the Labor Party study the new tax reform program that we are introducing and support it in this parliament so that we can get on with it. It is the only program that will compensate people, will allow for the future and will allow taxpayers to have the major tax cuts that my colleague was talking about previously. Where is the Labor Party's policy on tax reform?WW4KEMPSenator Kemp—None.VW4Senator HERRON—They offer no alternative, but they carry on with issues of this nature which are ill informed and ill understood and they create a scare campaign in the general public.4293Evans, Sen ChrisSenator CHRIS EVANSAX5WAALP00—Madam President, I ask a supplementary question. I would remind the minister that these are concerns that have been raised by industry providers. His answer was totally incomprehensible. The key issue is: what is the government doing to ensure that older Australians do not suffer a reduction in the quality of their care because the compensation package is designed to erode over time and, as a result, nursing home providers will have their funding cut? Can the minister guarantee that community based aged care providers, such as the churches, will not have their real funding reduced when the compensation package does erode?4294Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—The answer was incomprehensible only to the ignorant and those who do not wish to understand. If Senator Evans had listened to what I had said, he would understand. He does not want to understand.The reality is that there are compensation mechanisms in place for those who are in nursing homes, and there are compensation mechanisms in place for the providers as well. The reality is that the Labor Party has no other alternative to what we intend providing and will provide if this legislation goes through the Senate.42944294Allison, Sen LynSenator ALLISON1M6VICAD00—My question is to the Minister for the Environment and Heritage. I refer the minister to his response to the World Heritage Bureau on Kakadu contained in his recently released 140-page report and, in particular, to his repeated description of that response as being needed `to correct errors of fact, science and law'. Is the minister aware that the first edition of this report by his department was printed and then pulped? Could the minister inform the Senate of exactly what the errors were of fact, science and law which made this last minute pulping necessary? Can he provide the Senate with an estimate of the cost of the printing and the pulping exercise?4294Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—The errors of law and fact were within the mission's report to the World Heritage Committee. It was those errors that had to be overcome by statements of correct fact and also with independent scientific verification.I am pleased to say that the honourable senator is in part true, in that we have pub lished the government's response to the request of the World Heritage Committee. That response is supported, as was requested, by a report from the Supervising Scientist, an independent statutory authority. The Supervising Scientist, in developing his report, took advice from such institutions as the CSIRO, the University of Melbourne and the University of New South Wales, and I am pleased to say that the outcome of that report is to confirm the Australian government's assessment that there is no scientific reason whatsoever why this project could not go ahead.1M6ALLISONSenator Allison—Madam President, on a point of order: I did not ask the minister what was in the report. I did ask what the cost of printing and pulping that report was.10000PRESIDENTThe PRESIDENT—There is no point of order.BH4Senator HILL—I thought the honourable senator was interested in getting to the truth of the matter, which is the government's response to the errors that were contained in the mission of the World Heritage Committee. Anyway, I am pleased to advise the honourable senator that the report and the independent scientific verification confirmed that the EIS process that was conducted for Jabiluka was quite correct in concluding that there were no environmental reasons why this project could not go ahead. That is not surprising because, for 18 years, we have witnessed the Ranger uranium mine operate in the same region quite safely according to the views of the Supervising Scientist.XE4BOLKUSSenator Bolkus—There is a difference and you know it.1M6ALLISONSenator Allison—Madam President, on a point of order: the minister is debating the matter and not answering my question. I ask you to direct him to answer the specific question, which was: what was the cost of pulping that report?10000PRESIDENTThe PRESIDENT—I cannot direct the minister as to how he deals with the question. I can merely draw his attention to the question which was asked, and I invite him to do so.BH4Senator HILL—Senator Bolkus was correct in his intervention—there is a differ ence between Ranger and Jabiluka. Ranger is an old mine, open cut, much larger footprint and, one would have thought, potentially more environmentally dangerous. Jabiluka is a small mine, underground and only 22 hectares of footprint in a park of 20,000 square kilometres.The difference is that Labor stood by for 13 years in office and said that Ranger was fine: `No environmental damage from Ranger.' But now, because Labor is out of government, suddenly Jabiluka is a great threat to this whole 20,000 square kilometres of park. That is the nonsense that has had to be overcome by the Australian government's response to the World Heritage Committee. I trust that, now that the response is on the public record, we are likely to get a fair and objective hearing by the committee in July. If that occurs, our facts will be found to be correct and this project will be permitted to go ahead with the support of the World Heritage Committee. On the issue of this pulping, I do not know of that and I will try to find some details.4295Allison, Sen LynSenator ALLISON1M6VICAD00—The minister finally got around to answering my question, and he did not have an answer. Could the minister also confirm that a second edition of the glossy report including colour photographs and maps of Kakadu was also pulped and that this too was a rushed job on penalty rates? What was the cost of this second report, and did it too contain errors of fact, science and law? I again ask the minister to explain to the Senate the problem with the first report. Can the minister now assure the Senate that there were no errors of fact, science and law in the third report, which eventually did go to Paris?4295Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—I will make inquiries on the issue, but the important fact is that, now the Australian government has the correct facts on the record, this is a step towards a fair debate of the issues in Paris in July. A fair debate will demonstrate that the Australian government has taken every reasonable step to ensure that this development is safe to the environment and safe in terms of protecting cultural interests. That has been our process in relation to this particular matter, and we can be confident now that the out comes are in accordance with what we earlier stated.42954295Reynolds, Sen MargaretSenator REYNOLDSXI4QLDALP00—I address my question to Senator Herron, the Minister representing the Minister for Health and Aged Care. Is the minister aware of the recent ACCC finding that the government's advertisements for the 30 per cent rebate could `potentially mislead the public'? Can the minister explain why the government not only spent over $7 million of taxpayers' money to promote the $1.7 billion a year rebate but also resorted to misleading statements to sell this policy? Can the minister confirm that, rather than stating `private health cover will now be 30 per cent cheaper for all Australians', the advertisements should have stated `private health cover will now be 30 per cent cheaper for families earning over $70,000'?4295Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—I thank Senator Reynolds for the question. Yes, it is true that the Australian Competition and Consumer Commission has expressed concern about the government advertising campaigns. However, it did not find it necessary to take action over these concerns. It took no action whatsoever. The current phase of the government's rebate advertising campaign is now complete, and the next phase of the campaign is being developed presently. The ACCC was concerned that the advertising did not clearly state that the rebate replaced the old Private Health Insurance Incentive Scheme and that people formerly receiving benefits under the Private Health Insurance Incentive Scheme may have expected to receive a further 30 per cent reduction in addition to these benefits.It is true, as has been stated on many occasions, that the charges change from time to time. Under the Labor Party, they increased 150 per cent in a short period of time and continued to increase. Press reports stating that some health fund members are not receiving the full 30 per cent rebate because they formerly benefited from the Private Health Insurance Incentive Scheme are false. The rebate scheme has replaced the Private Health Insurance Incentive Scheme. All members holding appropriate private health insurance policies are now entitled to a full 30 per cent reduction of their health insurance premiums, regardless of whether or not they participated in the old scheme.No-one who was receiving the Private Health Insurance Incentive Scheme will be worse off under the new scheme. The majority of these recipients will be better off because they will now receive a full 30 per cent rebate whereas under the Private Health Insurance Incentive Scheme it was much smaller. Mass advertising does not contain the level of detail required by some health fund members.UI4RAYSenator Robert Ray—Not if it is paid for by the taxpayer.VW4Senator HERRON—In any case, this is only one component, Senator Ray, of the rebate information campaign. Comprehensive material such as information kits, brochures and fact sheets have been distributed widely to help fund members and Medicare offices. This material clearly states the rebate scheme replaces the old Private Health Insurance Incentive Scheme. This information is also available through the federal government 30 per cent rebate information line, which has been heavily publicised through all television and print advertising.Nevertheless, Dr Wooldridge's department has written to all health funds to inform them of the ACCC position and to advise that advertising should not make representations and have words to the effect that premiums are now 30 per cent cheaper. Funds have also been asked to refer to the fact that the rebate replaces the Private Health Insurance Incentive Scheme.The ACCC has also expressed concern that people who have policies with unregistered health funds may have expected to receive the rebate. The government has decided not to apply the rebate to people covered by such policies because they have not contributed and do not contribute towards the cost of the chronically ill and the elderly through the reinsurance arrangements. Funds have been advised that all advertising should refer to the two requirements for eligibility contained in the definition of an appropriate private health insurance policy: firstly, that the fund is a registered health benefits organisation and, secondly, that all people covered by the policy must be eligible to receive Medicare benefits.Claims that $7 million worth of taxpayers' money has been wasted on halted rebate advertising are totally false. The entire budget for the promotion of the rebate is around $7 million, which is less than half of one per cent of the total private health insurance rebate program. The government has a responsibility to inform the public about new initiatives. I make no apology whatsoever for advertising an important entitlement that can do so much to ensure the sustainability of Australia's health system.4296Reynolds, Sen MargaretSenator REYNOLDSXI4QLDALP00—Madam President, I ask a supplementary question. Will the minister also acknowledge that, in resorting to misleading statements to sell the 30 per cent rebate, the government has admitted a complete lack of confidence in its own product? Will the minister also admit that the $1.7 billion a year rebate will do little to improve Australia's health care system? Why is the government attempting to shift the responsibility for airing the misleading and deceptive advertisements to the Department of Health and Aged Care, particularly to its Secretary?4296Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—The answer to the first two questions is no and no. The answer to the third question is that it is not.42964296Brown, Sen BobSenator BROWNQD4TASAG00—My question goes to the Minister representing the Prime Minister. I ask Senator Hill: will the issue of West Papua be raised in talks between the Prime Minister and President Habibie today? In particular, will the Prime Minister be raising the issue of recent massacres of people aspiring to independence for West Papua, otherwise called Irian Jaya? Will the government raise with Indonesia the bill now being rushed through the Indonesian parliament to separate West Papua into three provinces in the run-up to the June elections as a means of thwarting the independence movement? Finally, will Mr Howard be expressing his distress that mob intimidation can have an impact on the aspirations for independence in West Papua above and beyond the impact it quite obviously has on him in regard to cricket?4297Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—I have not seen anything to suggest that the issues of Irian Jaya will be raised by the Prime Minister in his talks over East Timor. I would think there is enough to discuss on the latter subject—in particular, ways in which we can be more confident than not that a peaceful vote can occur in an open and free way on the issue of autonomy. That, as I understand it, is the reason for the discussions taking place in Bali. As I said, I have no indication of other matters but, as it has been raised by Senator Brown, I will pass that on to the Prime Minister and see if he wants to add anything at a later date.4297Brown, Sen BobSenator BROWNQD4TASAG00—Madam President, I ask the minister a supplementary question. Does the minister have any further information on my earlier question of him of some months ago regarding threatening and harassment of West Papuan leaders following a visit to meet President Habibie on 26 February in Jakarta? Can he tell the Senate whether or not it is true that the Commissioner for Police has now banned even discussions of those meetings with President Habibie? Are there West Papuan leaders still in gaol as a result of earlier demonstrations for independence, and does the government have any information as to the wellbeing of those previously gaoled independence leaders?4297Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—I do not have any new information on that, but again I will pass on Senator Brown's concerns.42974297Faulkner, Sen JohnSenator FAULKNER5K4NSWALP00—My question is directed to Senator Ellison, the Special Minister of State. Can the minister explain how the Howard government developed and ran an advertising campaign that could, according to the independent watchdog, the ACCC, potentially mislead the public? Does the minister acknowledge that the government's advertisement, which states `private health cover will now be 30 per cent cheaper for all Australians', was plainly deceptive? Didn't every one of these misleading ads carry the line `Authorised by C. Ellison for the Commonwealth Government, Parliament House, Canberra'? What is your responsibility for this, Minister?4297Ellison, Sen ChrisSenator ELLISON9X5WALPSpecial Minister of State10—Of course, I did authorise that advertisement. I reject any allegation that it was misleading. In fact, you will notice that the ACCC took no action against the government in relation to that advertisement. The campaign was not stopped as a result of any comment by the ACCC, as has been alleged by the opposition. In fact, the television campaign ceased on 13 February, the print advertising finished on 23 January and outdoor advertising finished on 6 April. Here we have a situation where the ACCC expressed a concern about the advertisement. It was not enough to take action against the government. Indeed, the campaign had come to its own conclusion, not as a result of any action by the ACCC. I authorised those advertisements and, when I authorised them, they were certainly not misleading.4297Faulkner, Sen JohnSenator FAULKNER5K4NSWALP00—Madam President, I ask a supplementary question. Minister, we have heard the Minister representing the Minister for Health and Aged Care say in question time today that the government was not trying to shift responsibility for these advertisements to the Department of Health or its Secretary. My question to you, Minister, is: as the person who authorised these ads which have been found to be both misleading and deceptive, do you take responsibility, or does some other minister take responsibility? What does the Westminster system of ministerial responsibility have to say about which minister in the Howard government should take responsibility for these false and misleading advertisements?4297Ellison, Sen ChrisSenator ELLISON9X5WALPSpecial Minister of State10—I have already answered the question in that I have stated that I authorised that advertisement. But Senator Faulkner's supplementary question is based on a false premise, because they have not been found to be misleading or deceptive. That is not what the ACCC said. I would remind the Senate—AX5EVANSSenator Chris Evans—It is; they said they were potentially misleading.9X5Senator ELLISON—I hear Senator Evans say `potentially misleading'. That is not a finding of something being deceptive or misleading. It is totally different. What the opposition are doing is trying to twist this to their own advantage. This has not been found to be a misleading advertisement.42984298Ferris, Sen JeannieSenator FERRIS5L6SALP10—My question is to the Minister for Aboriginal and Torres Strait Islander Affairs. Given the priority the Howard government has placed on solving rural health problems, will the minister please outline what the government is doing to assist the states with the recruitment of doctors for rural areas?4298Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—I thank Senator Ferris for the question and for her interest in his important field, because it is good news, great news, for people living in rural and regional Australia. I see my colleague Senator Ian Macdonald nodding his head with great satisfaction. The Minister for Health and Aged Care, Dr Wooldridge, recently made a public offer to all states and territories that the government would address immigration requirements which present difficulties for the medical registration of overseas trained doctors wishing to work in rural areas of Australia. Prior to the weekend, only two state ministers had responded to the offer—John Day in Western Australia and Rob Knowles in Victoria. Dean Brown from South Australia rang up this morning to say that there was a letter in the post. Western Australia and the Commonwealth have struck a deal to attract more doctors to rural and remote areas of that state.Doctors seeking entry to the scheme will be assessed by the Royal Australian College of General Practitioners instead of undertaking the Australian Medical Council examinations. Their medical registration will be restricted to rural areas to practise for a period of at least five years. Dr Wooldridge has offered $500,000 to assist this recruitment initiative. As senators already know, it is the government's policy to allow all doctors registered by a state or territory medical board to have access to a provider number to work in rural and remote areas.I would like to stress that this offer is open to all states and the Northern Territory. I note in today's Courier-Mail that my own state is keen to play catch-up, and I strongly encourage the Beattie government to contact the Commonwealth to strike a similar deal for Queensland. I am very disappointed, in fact, that contact has not yet been made. It is nearly three weeks since Dr Wooldridge made this offer to the states and Queensland, New South Wales and Tasmania do not appear to have moved on the issue. These states all have Labor governments—surprise, surprise, Madam President! Wendy Edmond, the health minister in my own state of Queensland, was reported as saying that she will contact Dr Wooldridge today but she had not done so at 12.30 p.m. when I checked. Hopefully, something has occurred since then. It is important that all states and territories get on with it. I am delighted that Western Australia has been the first to take the bull by the horns on this difficult issue. I am very disappointed that some other states, including my own, have been slow to take advantage of this offer from the Commonwealth.This offer comes on top of some much needed strategies introduced by this government to address the rural health crisis. They include the John Flynn scholarships at university departments of rural health, including at Mount Isa. I notice Senator Ian Macdonald again nodding his head about the Townsville medical school and the opportunity for students in that area. Senator Reynolds should be clapping her hands, Madam President, at that announcement coming from Townsville. There are more country kids getting into medicine. There are locum programs, Rural Workforce Agencies, and more—so a lot is being done. But the Commonwealth can only do so much; the rest is up to the states. I urge all senators representing New South Wales—such as Senator Faulkner here—Tasmania and Queensland to put pressure on their state premiers to address the rural doctor crisis—because, Madam President, we are.42994299Carr, Sen KimSenator CARRAW5VICALP00—My question is to the Minister representing the Minister for Education, Training and Youth Affairs. Can the minister confirm that the government has agreed to undertake a so-called financial and academic review of Greenwich University? Can the minister inform the Senate as to the form, terms of reference and time line of this review? Can he also confirm that the Norfolk Island administration has already privately committed itself to repeal the legislation if the review finds against Greenwich University?BH4HILLSenator Hill—On a point of order, Madam President: opposition spokesmen seem to have fallen into bad habits in the last week, Madam President. I ask that you remind them of their responsibility to ask questions through the chair—Senator Faulkner in particular and now Senator Carr.10000PRESIDENTThe PRESIDENT—I am sure senators know that questions should be asked through the chair and answers should also be given through the chair. I would remind all senators of that.5K4FAULKNER Senator Faulkner—You are just trying to drag back all that ground that Richard Alston lost.10000PRESIDENTThe PRESIDENT—Order! Senator Faulkner, I have called for order so I can ask the minister to respond.4299Ellison, Sen ChrisSenator ELLISON9X5WALPSpecial Minister of State10—As I have previously stated in the Senate before—and as the Minister for Education, Training and Youth Affairs, Dr Kemp, has stated—Greenwich University is the responsibility of the Norfolk Island minister responsible for higher education. This matter arose at the ministerial council of education ministers last week and as a result there has been endorsement of the course of action taken by the minister for education. As I previously advised the Senate, the department is taking steps to establish a committee, including representatives of the Commonwealth, the Australian Vice-Chancellors Committee and the states and territories, to consider information and to provide information and advice to the minister for education. As to what the Norfolk Island government is doing, I cannot tell the Senate. I can say that there has been a course of action adopted by the Commonwealth in conjunction with the ministerial council, and it has the endorsement of that ministerial council of education ministers.4299Carr, Sen KimSenator CARRAW5VICALP00—Madam President, I ask a supplementary question. I can take it from the minister's answer that there has in fact been a review established into the decision to direct the Administrator of Norfolk Island as to the establishment of the Greenwich University. Does the government now also acknowledge that a mistake was made in that direction?5K4FAULKNER Senator Faulkner—Who by?AW5Senator CARR—By Senator Ian Macdonald. Does it also acknowledge that there is a need to correct that mistake, as a result of the direct threat that the establishment of this university now poses to the international standing and reputation of Australia's higher education? Further, can you confirm, Minister, that the Commonwealth had been negotiating with the Administrator of Norfolk Island on the establishment of the university for up to a year prior to the passing of the Greenwich University act? And was it the case that the department failed to warn the government of the dangers posed by the establishment of a bodgie university such as Greenwich?10000PRESIDENTThe PRESIDENT—Order! The supplementary question also was not delivered through the chair, Senator.4299Ellison, Sen ChrisSenator ELLISON9X5WALPSpecial Minister of State10—Madam President, there is nothing new in the course of action that the government has taken. In fact, as previously advised, the minister for education has ordered a rigorous examination of the application by the Greenwich University to be included on the AQF register. That is something which I have advised previously. What happened last week was that this was raised at the ministerial council of education ministers and that course of action was endorsed. Despite what Senator Faulkner says, there is nothing new about this.5K4FAULKNER Senator Faulkner—It is humiliating, I said—really embarrassing.9X5Senator ELLISON—There is nothing humiliating about this. The course of action has been endorsed by the ministerial council of education ministers in this country.43004300Stott Despoja, Sen NatashaSenator STOTT DESPOJA3I6SAAD00—My question is addressed to the Minister representing the Minister for Health and Aged Care. I am wondering if the minister can give us an assurance that the proposed amendments to ANZFA's A18 standards will not allow for the approval of genetically modified foods solely on the basis of overseas regulatory authorities. Is the minister aware that, under the US Food and Drug Administration, there are no compulsory testing regimes for adverse health or environmental effects of genetically modified foods, and that evaluation of new plant varieties and products under the FDA allows for industry to actually undertake testing at their own discretion? Does the minister agree that these regimes are certainly insufficient and that they will not be replicated in Australia?4300Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—I thank Senator Stott Despoja for the question because I think all of us share her concern about genetically modified food. To answer her question, the responsibility for determining whether foods are available to the general public is accepted by the Australia New Zealand Food Authority. No genetically modified food considered unsafe will be permitted on the market by the Australia New Zealand Food Authority. That is the criterion they accept. Standard A18, the standard that Senator Stott Despoja referred to, has a number of important features. There will be a general prohibition on the sale of foods produced using gene technology. The standard will list any foods produced using gene technology that are permitted for sale.Applications for inclusion of products in this standard will need to be made through the authority's normal application process. Approved foods will be listed in a table to the standard. Following an application to the authority, the safety for human consumption of food will be assessed according to the authority's publicly available safety assessment guidelines for foods to be included in standard A18, food produced using gene technology. During this assessment, the authority will also determine if the food will require mandatory labelling. Any special conditions on the sale of the food, such as mandatory labelling, will be listed in the table to the standard. The assessment of all foods which are the subject of an application with ANZFA are open to public review, and public comment is invited.At the 17 December 1998 meeting of the Australia New Zealand Food Standards Council, the majority of state and territory health ministers were in favour of broadening the existing mandatory labelling provisions of standard A18 to include substantially equivalent foods. This is what Senator Stott Despoja was referring to in the sense of whether foods would be permitted if they had been subject to study overseas. Specifically, the council requested that the amendment should mandate labelling in circumstances where the manufacturer knows the food contains genetically modified material and, if the manufacturer is uncertain about the food's content, the manufacturer is to indicate that the food may contain genetically modified material. If the manufacturer knows the product to be free of genetically modified material, there will be no requirement to so label the product, but it may be.Health ministers also asked the Australia New Zealand Food Authority to develop for their further consideration the definition of the term `genetically modified food', recognising there are many food ingredients such as sugars and oils which can be made from genetically modified plants but are not themselves genetically modified. These issues, as well as being matters of concern to the Australia New Zealand Food Authority, are matters of concern to the state regulatory authorities and territories. The standard that I have mentioned comes into effect on 13 May this year and will require the safety assessment and approval of all genetically modified foods and labelling of genetically modified foods that are substantially different from their traditional food counterparts.4300Stott Despoja, Sen NatashaSenator STOTT DESPOJA3I6SAAD00—Madam President, I ask a supplementary question. I thank the minister for his answer. I am glad to hear that he is concerned that unsafe genetically modified products would not be available for sale in Australia. But I reiterate my question in relation to international standards. I would like the minister to confirm for us whether or not acceptance or approval of a genetically modified food overseas will be accepted as the sole basis for approval for sale of that product in Australia. Could you clarify if that will be specifically one of the criteria that will be allowed under the A18 standards that will be put forward by ANZFA?4301Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—I thought I made it clear that it would not be the sole criterion by which any food would be accepted in this country. If the minister can add anything further to the answer I have already given, I will be happy to provide it.43014301Crossin, Sen TrishSenator CROSSIN7Y6NTALP00—My question is directed to the Minister representing the Minister for Aged Care. Can the minister confirm that currently nursing home residents in Queensland receive an average of $13 a day less in Commonwealth support than residents in New South Wales for the provision of their care? Isn't this problem just one more symptom of the $480 million the government has cut from aged care?4301Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—I cannot say exactly what the sum is, but there is a difference in Queensland and it was brought about by the action of the Labor Party when they were in government. If there is a difference, it is due to the Labor Party. They made no effort whatsoever. When we came into government we approached the Productivity Commission and asked them to produce a report. Nursing homes in Queensland are getting more taxpayers' dollars now than they have been before. Under the existing funding rates, there are record levels of interest in expansion and acquisition of new homes and, with few exceptions, the quality of care is good. Business failure is practically non-existent and the price of bed licences traded on the open market continues to rise. As I mentioned previously to Senator Evans, Queensland owners are now choosing to pay up to $30,000 per bed for licences alone—no land or buildings; that is just for the licence—which is as much as they are paying elsewhere across Australia.The government's 1997 decision was to fix Labor's ramshackle and outdated funding system by moving to uniform national nursing home subsidies. It has been vindicated by the Productivity Commission. While we want changes to happen more quickly, any changes must take account of providers in all states and territories. The Productivity Commission's report was released at the end of March. So the industry across Australia will have an appropriate opportunity for consultation and discussion before a whole of government decision is taken in response to the commission's recommendations. Consultation has already started.Senator Crossin could easily have prefaced her question with: why are nursing homes in other states getting $13 more than the providers in Queensland? Because that was a result of Labor Party policy. The opportunity now has arisen for what is termed `coalescence' whereby across the nation there will be an equivalence given to a funding structure based on a standard rate. The Productivity Commission report supported the government's objective of a funding structure based on a standard rate across Australia with supplements for higher cost rural and remote areas—once again, Senator Ian Macdonald, benefiting rural and remote areas, which are of particular concern to you.Let us remember that the state-by-state funding structure was Labor's system. So what Senator Crossin is complaining about was brought into place by her party, the then government. The current system, which is a legacy of Labor's mismanagement, is the system that gave Queensland providers the lowest subsidy rate of all states. So the coalition has been left with the responsibility to fix it up, and we shall.4301Crossin, Sen TrishSenator CROSSIN7Y6NTALP00—Madam President, I ask a supplementary question. Minister, do you agree with your colleague the member for Fadden that the government should increase funding to nursing home providers in Queensland? Have you joined with coalition backbenchers in approaching the Minister for Health and Aged Care on behalf of older Queenslanders to resolve this funding crisis? Can the minister give us a guarantee that the government will not freeze aged care funding to other states, particularly Tasmania and Victoria, in order to bandaid the problem in Queensland? When will the Howard government seriously tackle the issue in all states?4302Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—I support all Queensland voters. I have no problem doing that. Yes, I spoke to the minister. As a Queenslander—and a proud Queensland senator, along with my other proud Queensland senators on this side—I approached the minister because I believed that they should be supported.BH4HILLSenator Hill—Madam President, I ask that further questions be placed on the Notice Paper .Questions Without Notice4302430215:01:004302Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—Madam President, I have some further information for Senator Allison about the alleged pulping of the government's report on Jabiluka. I am advised that the government ordered a print run of some 500 copies of the report, to be delivered in batches on completion. After the first batch had been despatched to Paris, it was realised that the printer made an error on some copies, inserting pages wrongly and repeating two maps. The printer corrected those pages at his own cost and resupplied corrected copies to the department. Eighty-five copies were initially sent to the Australian Embassy in Paris before the errors were detected. These copies were destroyed in Paris. I am further advised that it is not correct to claim that a second edition was pulped. I am told that the initial print run has not met the requests for copies, both internationally and domestically—for example, the World Heritage Committee this morning requested another 150 copies. A further 1,000 copies are being printed. Some typographical and design errors are being corrected in this print run.430215:02:004302Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—Senator Gibbs asked me a question last week in relation to the cost of provision of treatment for illicit drug users, and I undertook to produce further material that was available. I have that with me, and I seek leave to have it incorporated in Hansard .Leave granted.The answer read as follows—Senate Question Without NoticeDIVERSION OF ILLICIT DRUG: USERS TO TREATMENTSENATOR GIBBS asked the Minister representing the Minister for Health and Aged Care without notice on 22 April 1999:Minister, on what basis did the Prime Minister arrive at the estimate that the additional $55 million a year to be provided for treatment of heroin users diverted from the prison system would be sufficient to treat 300,000 addicts? Given that the average cost of heroin treatment is in the order of $5,000, is it not the case that the government has created false hopes among many heroin addicts and their families and that in fact there will only be funds for about 10,000 extra treatments a year?SENATOR HERRON—the Minister for Health and Aged Care has provided the following answer to the honourable Senator's question:The details of the diversion program will have to be determined in close consultation with State and Territory Governments the NGO Sector Australian National Council on Drugs and other relevant experts, however it is anticipated that the program will:* target all illicit drug users, not just heroin users;* target illicit drug users early. That is, before they have an extensive criminal record and, in many cases, before they are actually drug dependent; and* provide a range of appropriate interventions for users.Illicit Drug users need a range of interventions to assist them to address their illicit drug use, depending on factors such as drug of choice, whether or not they are drug dependent, drug use and treatment history social situation and personal preference.As such, it is anticipated that those diverted from the criminal justice system will access a range of services. Some may only be assessed and provided a brief educational intervention, while others may require outpatient counselling and/or detoxification. A smaller number of clients will require more intensive interventions such as methadone maintenance therapy (in the case of some dependent heroin users), or residential rehabilitation. The cost of these various treatment options varies significantly, with residential treatment and methadone maintenance being the most expensive.Premiers and Chief Ministers throughout Australia supported this important initiative at the Council of Australian Governments meeting on 9 April. The initiative builds on diversion programs currently being trialed in a number of States.Health and Law Enforcement Ministers from each jurisdiction will be discussing this initiative further at the Ministerial Council on Drug Strategy meeting scheduled for June and reporting back to COAG for their further consideration.SENATOR GIBBS asked the Minister representing the Minister for Health and Aged Care without notice on 22 April 1999Given that the minister is standing by the Prime Minister's assertion that 300,000 addicts will be treated with the additional funds, will he undertake to provide to the Senate the current average cost for treatment of heroin addicts and the statistics on which the 300,000 figure is based?SENATOR HERRON—the Minister for Health and Aged Care has provided the following answer to the honourable Senator's question:The cost of treatment for illicit drug use, including heroin, varies significantly from State to State and from treatment type to treatment type, For examples the benchmark price for residential rehabilitation quoted by the Victorian Department of Human Services and Health in May 1998 was approximately $7000, while the cost of counselling, consultancy and continuing care was approximately $340.The figure of 300,000 refers to the total number of interventions which may potentially occur. The range of interventions might include assessment only, education, outpatient services and residential services.Different treatment options are appropriate for different people, depending on factors such as drug of choice, whether or not they are drug dependent, drug use and treatment history, social situation and personal preference. As such, it is anticipated that those diverted from the criminal justice system will access a range of services. Some may only be assessed and provided a brief educational intervention, while others may require outpatient counselling and/or detoxification. A smaller number of clients will require more intensive interventions such as methadone maintenance therapy (in the case of some dependent heroin users), or residential rehabilitation. The actual mix of treatment services required will need to be determined in close consultation with State and Territory Governments and local agencies.430315:03:004303Evans, Sen ChrisSenator CHRIS EVANSAX5WAALP00—I move:That the Senate take note of the answers given by the Minister for Aboriginal Affairs and Torres Strait Islander Affairs (Senator Herron) and the Special Minister of State (Senator Ellison), to questions without notice asked by Senator Evans and the Leader of the Opposition in the Senate (Senate Faulkner) today, relating to the government's private health insurance rebate.I think it is fair to say that while Senator Herron—as Senator Ray quite correctly put it—made a long, guilty plea, Senator Ellison's legal training could not allow him to plead guilty. For the record, I want to quote what the ACCC said, so that people are not misled by the rather cute answer given by Senator Ellison.In its decision, the Australian Competition and Consumer Commission reviewed the advertisements paid for by the government promoting their rebate scheme. The commission said that the quote which was used widely in the ad—that is that `private health cover will now be 30 per cent cheaper for all Australians'—could potentially mislead the public. The commission also found that it would have a flow-on effect on the advertising of the rebate by private health funds. The reason the commission did not take action is that the government undertook to end the campaign. The government said that the campaign had been finalised and that the billboard advertising would be removed; therefore, there was no possible remedy that the ACCC could take because the campaign had finished. As I said, Senator Ellison's answer was fairly cute and I think misleading.The real issue here is why the government spent $7 million of taxpayers' money running a highly misleading campaign that has a lot of Australians angry and confused about the rebate. They knew it was misleading. They knew that it was not going to provide 30 per cent cheaper rebates for all Australians, but the ads continually said that private health insurance cover would be 30 per cent cheaper for all Australians.They knew that was not true. Their own figures—their own advice from the department—led them to the conclusion that that was not true, but they still spent $7 million of your and my money trying to push that line down the throats of Australians. They deliberately misled them. It is not bad enough that they have wasted $1.7 billion of taxpayers' money on a scheme that the private health insurance industry now admit will not work—will not result in an increase in membership—they then threw another $7 million of taxpayers' money at it, misleading the Australian public about what was delivered in the rebate.What we do know is that only about half of the people who benefit from this scheme will get 30 per cent cheaper health cover. The 2.4 million Australians who are eligible under the previous PHIIS do not get 30 per cent cheaper cover, and a number of people have written to me about this. A pensioner couple and a number of others have worked out that they are no better off under this scheme than they were under the other scheme. As a result of Labor bringing this anomaly to the government's attention the government put in a clause that ensured no-one could be worse off. The fact is that 2.4 million Australians do not get 30 per cent cheaper cover—many of them do not get cheaper cover at all—yet the government spent $7 million misleading them about that. A number of people who have been to see me have been very angry about it because they believed what the government told them. They believed that the TV ads, the newspaper ads and the billboards were accurate. Of course, they were not accurate. The ACCC has found that they were not accurate, and the government does not seem to care.There is no mention of an apology. There is no suggestion of accepting that the wrong thing has been done. We get the lawyers answer from Senator Ellison today—he tries to duck and weave. But the ACCC found that the government misled the public in claiming that private health insurance will be 30 per cent cheaper, and the government intend to do nothing about that because they have got away with it. Their line is, `The campaign is over and we got away with it, so what does it matter?' I think it does matter. I think it is an important public policy issue. It is an important issue about the expenditure of public moneys.The minister is prepared to spend public money knowingly misleading the public. The government had this information. The department had provided it in terms of the debate we had on the bill. They knew they were misleading the Australian public and they still spent taxpayers' money doing it, for political advantage. The only families who get 30 per cent benefit from the measure are those who are on over $70,000 a year. The benefits of 30 per cent cheaper cover go to the top end of town. That is the truth about the new scheme. It is directed largely at the top end of town—those on family incomes over $70,000. That is where the benefit goes. (Time expired)15:08:004304Knowles, Sen SusanSenator KNOWLESTH4WALP10—Once again we have a completely false argument being put to the Senate today. It never ceases to amaze me how the Labor Party can come into this chamber and say things that are totally and utterly untrue.5F4CALVERTSenator Calvert—They do it every day.TH4Knowles, Sen SusanSenator KNOWLES—That is exactly right, Senator Calvert. They do do it every day. But why is there not some responsibility in the Labor opposition to actually start telling the truth? This argument is coming from an opposition that, when in government, presided over the decrease of private health membership from over 70 per cent of the population to 30 per cent of the population. What is the most tragic part of that is that they are proud of that decrease. They are proud of that decrease from the point of view that they have simply gone through the stage of forcing more people onto the public purse.5K4FAULKNER Senator Faulkner—You are an incompetent liar.TH4Knowles, Sen SusanSenator KNOWLES—Excuse me. I would like that to be withdrawn from megamouth over there.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Order! Senator Faulkner.5F4CALVERTSenator Calvert—Madam Deputy President, you heard that reflection upon my colleague and I ask you to ask Senator Faulkner to withdraw it.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Would you just give me a minute. Senator Faulkner, would you please withdraw. That is unparliamentary, as you well know.5K4FAULKNER Senator Faulkner—I will replace it with incompetent misleader.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Senator, would you please withdraw it unconditionally.5K4FAULKNER Senator Faulkner—I have withdrawn it, Madam Deputy President.TH4Knowles, Sen SusanSenator KNOWLES—Thank you, Madam Deputy President. This is the type of behaviour that we have now come to expect since Senator Faulkner has been Leader of the Opposition in this chamber. It is just simply bullyboy tactics. He thinks he is at a TLC meeting or whatever. It is just absolute thuggery in here.Senator Faulkner interjecting—TH4Knowles, Sen SusanSenator KNOWLES—This question of private health insurance is something—Senator Faulkner interjecting—10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Order! Senator Faulkner, would you please withdraw that.5K4FAULKNER Senator Faulkner—What is unparliamentary about that?10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Just withdraw. It was a reflection. Please withdraw.TH4Knowles, Sen SusanSenator KNOWLES—Withdraw.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Order! Senator Knowles I do not need—5K4FAULKNER Senator Faulkner—I do not mind withdrawing. I am happy to withdraw anything. But I am merely using the same language as the senator on her feet is using, who is well known for it. But if it offends you I am happy to withdraw it.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Thank you. Senator Knowles, I ask you to curb your—TH4Knowles, Sen SusanSenator KNOWLES—Thank you, Madam Deputy President. This person is just simply a disgrace to the parliament.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Order! Senator Knowles, to call a member of this house a disgrace is also reflecting on them, so would you please withdraw. I would ask everybody on both sides to curb their enthusiasm and to maintain parliamentary language.TH4Knowles, Sen SusanSenator KNOWLES—I will withdraw that, but I can tell you that I am not going to stand here and tolerate—10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Unconditionally withdraw.TH4Knowles, Sen SusanSenator KNOWLES—I have withdrawn it, Madam Deputy President. I know you are after protection of your own side, but I am not going to have this—10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Senator Knowles, would you care to rephrase that, or I might be forced to take that as a reflection upon the chair.TH4Knowles, Sen SusanSenator KNOWLES—If you are that precious, Madam Deputy President, I will withdraw that—10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Senator Knowles!TH4Knowles, Sen SusanSenator KNOWLES—I will withdraw it and get on with this debate that the Labor Party continually wants to interrupt. You can either pull them into line and—10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Senator Knowles!TH4Knowles, Sen SusanSenator KNOWLES—I want to debate the absolute untruths that the Labor Party are putting forward about private health insurance. If they do not want to listen to that then that is their problem, but it is a responsibility to have an equal opportunity for this argument to be put forward.This is the mob, over that side of the parliament, that presided over the massive reduction of private health insurance. They are now coming in and saying that a 30 per cent rebate that is put up by the current government is inadequate, while it is providing the equivalent of full tax deductibility to over 80 per cent of taxpayers. Yet they say that it is inadequate. It is not discriminatory in any way, shape or form.It is interesting that Senator Evans always comes in here and says, `I've had letters; I've had letters; I've had letters.' As my colleague Senator Abetz continually asks him, `Which branch of the Labor Party did you get that letter from?' He cannot produce any letters. He can never substantiate them. It is all just, `I've had letters.' Why does he not just come in and say, `It is a figment of my imagination' or `I believe this to be the case' or `I want to misrepresent the case'? The fact of the matter is that this simply has enhanced the opportunity for people to get into private health insurance.It will be interesting to see the figures when they come out in a month or so's time, to see how many more people have gone back into private health insurance. In the initial stages what we have been trying to do is stop the drop-out rate that was inspired by Labor. To put a floor under that drop-out rate is important. The reason it is important is that the people who are solely reliant on the public system may then be able to get into the public system. What Labor presided over was making sure that more and more people were forced on to the public system. That became more and more clogged. The waiting lists became longer, and people were unable to access treatment when they wanted it.That is an unfair system. It is totally improper for a country as wealthy and affluent as Australia is, by today's world standards. Yet that is what Labor wants and that is what they want to go back to. This is just symptomatic—as with every other initiative that the Howard government puts forward. They will oppose it at every single opportunity. Why they are opposing something that is benefiting every taxpayer in Australia I do not know, other than pure politics, and pure politics of dishonesty.15:14:004306Faulkner, Sen JohnSenator FAULKNER5K4NSWALP00—Another macho performance today from Senator Knowles, whose behaviour in the chamber appears to have changed since she was caught providing questions to the Western Australian Labor Party opposition, undermining members in the Western Australian Liberal Party.TH4KNOWLESSenator Knowles—Madam Deputy President, on a point of order: I ask for that to be withdrawn. It is totally wrong, it is totally improper and without foundation, and I ask for that to be withdrawn.5K4Faulkner, Sen JohnSenator FAULKNER—It is not improper at all. That is not unparliamentary.TH4KNOWLESSenator Knowles—There is absolutely no foundation, Madam Deputy President, and I ask for it to be withdrawn.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—It is a matter for debate, Senator. If you claim to have been misrepresented, you can take that up at the end of this particular session.5K4Faulkner, Sen JohnSenator FAULKNER—We have become used to this sort of behaviour from Senator Knowles, who seems to have rewritten the rules of how one behaves at a parliamentary committee. She has developed a new line of bullyboy tactics—TH4KNOWLESSenator Knowles—Madam Deputy President, on a point of order: is this debate about health insurance or about Senator Knowles? I draw your attention to relevance and ask you to draw the attention of Senator Faulkner to the issue that is before the Senate now.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Thank you, Senator Knowles. I am sure that Senator Faulkner is about to get to addressing the answers which are being taken note of.5K4Faulkner, Sen JohnSenator FAULKNER—Thank you, Madam Deputy President. I was just responding to the earlier contribution in this debate.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Just address the chair and ignore the earlier interjections.5K4Faulkner, Sen JohnSenator FAULKNER—I am addressing you, Madam Deputy President, and pointing out that some of the issues that were raised by the previous speaker deserved being dealt with in the way that I just have. We have a situation where the government has been caught absolutely red-handed misleading the public in a massive advertising campaign—a $7 million advertising campaign. Do not forget: this is of course public money that is being misused to promote the government's health insurance policy. The ACCC has found that these government advertisements could potentially mislead the public. Today in question time Senator Herron made absolutely clear that it is not the responsibility of the Department of Health and Aged Care nor is it the responsibility of the Secretary to the Department of Health and Aged Care. He is not willing to take responsibility himself, but someone in government has to come up and take responsibility for these particular advertisements.Of course we are getting used to the misleading and deceptive modus operandi of the Howard government when it comes to advertising. Who could forget the $20 million misuse of public moneys that occurred in the lead-up to the last election, for the first time ever, on an advertising campaign that promoted a party election policy? By the way, that expenditure in just 15 days across all media—misleadingly flogging the GST tax proposal—represented an outspending of McDonald's, Toyota and Coca-Cola combined for that month. Of course there was virtually no truth in that advertising campaign either, but this is the way that the Liberal Party does business under John Howard as Prime Minister.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Mr Howard, please.5K4Faulkner, Sen JohnSenator FAULKNER—Who could forget the focus groups that killed off the divisive Wik ads which were actually being created in the Prime Minister's office that the Prime Minister wanted to publish in newspapers in the lead-up to Australia Day just a year or so ago? It does not surprise me that Dr Wooldridge and Senator Ellison, in this particular case, have been caught absolutely red-handed telling porkies about the government's health insurance policies. It does not surprise me at all.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Senator Faulkner, would you please not accuse ministers of whatever euphemism you wish to use for lying? Would you please withdraw that?5K4Faulkner, Sen JohnSenator FAULKNER—Is `porkies' unparliamentary?10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—It is a euphemism, Senator Faulkner.5K4Faulkner, Sen JohnSenator FAULKNER—If `porkies' is unparliamentary, I withdraw it. I always thought it was, but I would ask you to check that one with the President. I am sure that it has previously been found acceptable in this place. The truth of the matter is: they were caught red-handed misleading the Australian people. And I am afraid this is a serious issue when you consider that $7 million of public moneys has been used to promote the government's health insurance policies. I must say that this is on top of $37.3 million spent by the government on advertising from June 1998 to the October election—an absolutely unprecedented amount of public moneys. This is the way the Howard government does business. On this occasion they have been caught red-handed by the ACCC, as revealed in question time in the Senate today, and no minister is willing to take responsibility. (Time expired)15:20:004307Abetz, Sen EricSenator ABETZN26TasLP10—It always seems that when the Labor Party do not have the facts to sustain their case they indulge in personal invective. Let us deal with the issue at stake here. We introduced a much needed policy to try to assist people in looking after their own health needs. When Labor first came into government some 16 long years ago, two-thirds of Australians had private health insurance. Now only one-third have private health insurance. And what is the problem with that? Very simply, the problem is that the demands on the public sector have doubled but the money is not there to provide proper services. As a result, the waiting lists have blown out time and time again. We as a government say that those who are able to afford private health insurance ought to avail themselves of it, thus saving the taxpayer and the public purse, thus freeing up the money for those who are genuinely in need. That is the basis of our policy and that is why we thought the people of Australia ought to be made aware of that change of policy, which basically gives a 30 per cent rebate to 80 per cent of taxpayers. It is a generous and a full rebate for 80 per cent of taxpayers.There was before us the issue of the ACCC's finding in relation to the advertisements that we ran. A Labor Party member, Mr Kelvin Thomson, made the complaint and all the ACCC said was that it was considered `potentially misleading', but the important thing was that they would take no action against the government. Basically it was a sop thrown to Kelvin Thomson to say, `It might have been potentially misleading, but we are not going to bother to take any action over this issue.' Why? Because, technically, any scheme that we had in place stopped on 31 December 1998. As of that date, nobody had the benefits of our previous policies. Our new 30 per cent policy came in on 1 January 1999 when not one single Australian had the benefits of our previous policy anymore. Therefore, it was technically correct for us to say that this was available as a 30 per cent rebate. Some people had a rebate previously, but that rebate expired the previous day and a new regime was in place.I could not help but think that possibly some people in the ACCC were sitting back with a wry smile on their faces when they said that this campaign was potentially misleading. The chances are that they thought that those in the Labor Party and those who wished to remain ignorant of the facts would potentially be misled. The reality is very clear: there was one scheme. It stopped one day at the end of one year and then a new scheme commenced the very next day, the very next year. Therefore, it is technically correct to say that that 30 per cent rebate was to apply.Furthermore, to suggest that the private health insurance rebate would apply to schemes that were not publicly endorsed, that were not necessarily publicly registered, that did not have the full cover of most of the major health insurance schemes, is—with respect to the ACCC or those trying to put that argument—drawing a considerably long bow. Clearly, the issue for the Labor Party to address is: what is their policy on health care after they ran down the public system for 13 years? How would they fund health care in this country without having the guts to face up to the fundamental issue of tax reform, which will provide more funding to the states and for the public health system through the states so that they can fund their health system? (Time expired)15:25:004308Crowley, Sen RosemarySenator CROWLEYZF4SAALP00—I would like to say to my colleagues opposite—particularly to Senator Knowles, who is making an art form of abuse in this place—that abuse is no substitute for substance.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Senator Crowley, would you please address the chair.ZF4Crowley, Sen RosemarySenator CROWLEY—Yes, Madam Deputy President. I would like to remind Senator Knowles that abuse is no substitute for substance. It is a great pity that she spent more than half of the time of her speech abusing anything and anybody, much as she did the witnesses before our GST inquiry. I have never in all my life heard witnesses before an inquiry being called liars to their face—by Senator Knowles. She is now trying to—TH4KNOWLESSenator Knowles—Madam Deputy President, I raise a point of order. Senator Crowley cannot just stand up here and say whatever she wants to say when it is untrue. I ask her to withdraw that accusation, as she will not find that word in Hansard in those hearings anywhere.ZF4Crowley, Sen RosemarySenator CROWLEY—You checked did you?TH4KNOWLESSenator Knowles—Yes. You made the claim before, Senator Crowley. I did check and you will not find it. So withdraw.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Order! Are you on the point of order, Senator Crowley?ZF4Crowley, Sen RosemarySenator CROWLEY—No way; I am trying to get on with this speech.TH4KNOWLESSenator Knowles—Are you? I thought you just wanted to abuse me.ZF4Crowley, Sen RosemarySenator CROWLEY—No, I was not abusing you, Senator.Senator Knowles interjecting—10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Senator Knowles, I will have some order. You have raised a point of order, and I will rule on that point of order. I do not need any assistance. Some of the things you have raised, Senator Knowles, are a debating point. If Senator Crowley has used those words in reference to you, then she is out of order and should withdraw them, but I did not quite hear the terms in which she used them.ZF4Crowley, Sen RosemarySenator CROWLEY—The government of the day is supersensitive about being caught telling mistruths and misleading the Australian people about the value of the private health insurance rebate. They have spent $1.7 billion—TH4KNOWLESSenator Knowles—Madam Deputy President, I have a point of order. I asked you before to ask Senator Crowley to withdraw those words.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Senator Knowles, Senator Crowley has not accused you of lying. If you think you have been misrepresented, then the appropriate time to take that up is at the end of this particular session.ZF4Crowley, Sen RosemarySenator CROWLEY—Thank you, Madam Deputy President. It is interesting the lengths we will go to so as not to allow the opposition to speak on this matter. The government say that they did not really mislead the Australian people by promoting advertisements—at the cost of $7 million precious public taxpayer dollars—which claim that private health cover would now be 30 per cent cheaper for all Australians. Senator Abetz got up and said that 80 per cent of the people were going to be covered. How can he possibly say that it is not misrepresenting to claim 100 per cent when the figure is 80 per cent? The reason they have been caught, the reason they are embarrassed and the reason they are blustering is that they know that they have been trying to fool the Australian people.One of the reasons that the government has had to do something about private health insurance is that, under Medicare, Australians actually worked out that private health insurance would fall from 70 per cent to 30 per cent. And it was not 30 per cent; it was much higher than that. Senator Knowles was skating thin with the truth there. The point is that most Australians realise that Medicare was their salvation. For the first time ever, Australians were protected from big health bills. The two million people who were uninsured before the Labor Party came into government now, for the first time, had protection. Never again would they face health bills that meant that they were crippled or which meant that many of them went sick and avoided going to the doctor. That is what Medicare did. That is why the Australian people opened their arms to Medicare and said, `This is fantastic.'The only way you can get a bill in health care now is if you have private health insurance. That is why the government is desperate to get some kind of gap insurance. People are leaving private health insurance because it does not deliver the goods.I would also say to Senator Knowles that the important thing about the Labor government's health policy was that it did not distinguish between people in terms of whether or not they could pay. It distinguished between people in terms of whether or not they had a health need—were they sick, did they need to get into hospital?—that was the criterion, not whether they could pay.This government is consistent in one thing. The majority of people who will get this 30 per cent rebate are those with an income above $70,000 a year—just the same as the people who are going to most benefit from the GST.Senator Knowles interjecting—ZF4Crowley, Sen RosemarySenator CROWLEY—You keep company with the top end of town, you legislate for the top end of town; that is exactly what you are doing with this rebate.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Address the chair, please, Senator Crowley.ZF4Crowley, Sen RosemarySenator CROWLEY—It is quite interesting and consistent that you will also go to great lengths to confuse and mislead the Australian public as you did with those advertisements. No amount of bluster will hide that. You were found out by the ACCC. They did not proceed to take any action because the campaign was then closed down, withdrawn. But it is interesting to note that the department has had to write to all the health funds saying, `Take care that you don't go on perpetuating this misleading claim because you too could then be hauled up and asked to account for this misleading advertising.'What you should be doing with the $1.7 billion is not underwriting the rich and the top end of town with their private health insur ance, you should be putting it directly into the public hospitals so that the thousands and millions of Australians who need health care can get it. That is where the money should be going to benefit the most Australians instead of subsidising private health insurance that will only make the costs of health more expensive. We have seen those rebates eaten up in times past. We do not expect this area of town to lower its prices. This $1.7 billion is not going to benefit the public hospital sector; it is not going to benefit Australians. The government was caught out telling a monstrous misleading statement. Why are they doing that? Because they are trying to change health away from the benefit of all Australians and that is their biggest crime. (Time expired)15:32:004310Synon, Sen KarenSenator SYNONFQ6VICLP10—Yes, we are super-sensitive on this side of the chamber and I am sure that Senator Knowles is as well. We are super-sensitive about implementing in policy the will of the Australian people. The reality is that the Australian people want a private health insurance scheme and they want a viable health insurance scheme. The government's 30 per cent rebate will provide more than six million Australians with private health insurance assistance and will provide a great incentive for many more to join.Private health insurance provides the choice that Australians want in their health system and should be entitled to. It also takes the pressure off public hospitals. Opinion research conducted some time ago by Morgan and Banks for health insurer MBF found that more than two-thirds of the community supported the introduction of a rebate for private health insurance—that is two-thirds of the community. What does it tell you that the ALP still does not support it? In fact, compendium research conducted every two years for the industry by Tony Quinton Associates has consistently found that a 25 to 30 per cent reduction was needed to bring more people into private health insurance. All Australians will benefit from the government's 30 per cent rebate.In March 1998, research showed that health and hospitals are the number one concern for Australians today. I suggest that you hear that on the other side because I do not think that has been reflected in some of the petty point scoring that has happened today. While over half of the respondents rated the overall health system positively, two-thirds of the population believed that it was declining and needed serious help.Improving health care for all Australians has been a key element of the Howard government's program since it was elected in 1996. The drop-out rate of private health insurance coverage is a primary influence on the responsiveness and effectiveness of health care. Private health insurance declined by more than half from 1983 under the ALP government.We have just heard that two-thirds of the Australian public is in favour of it; let's hear a little about the ALP's record in this area. In particular, in 1993 former Senator Graham Richardson, the then minister for health, warned that private health cover rates were declining and that something needed to be done to ensure the system did not totally collapse. He said:We've got to look seriously at how we get the numbers in private health cover up. It was 70 per cent when we came to office and it is about 40 per cent now. The drop last year was dramatic.This was their own health minister at the time. He continued:If the drop continues at any rate like it has been over the next few years, it won't be long before there will be enormous pressure on the public health system.That was Graham Richardson in 1993. Even after he left the Senate, however, Graham Richardson was still having something to say about it and lamenting the ALP's stand. He said:Everyone has to lose some battles but I wish I had won this one.Now the Liberal Party is putting forward the same idea.Even the thought that the Liberals are prepared to make the rich pay more, when the Labor Party would not, is enough to scare the hell out of me.That was Graham Richardson in August 1996. However, he continued his interest in the area in November 1998. He restated his frustration with his former colleagues and said:There's an ideological bent here that says Medicare is perfect which is ridiculous and therefore nothing should be done about private health which is also ridiculous. What they don't want to acknowledge is that as these people are dropping out of private health insurance they are simply queuing up at the public health system to be looked after. I wish Labor would stop this silly notion that it doesn't matter if private health care collapses, because I tell you what, we're within five years of a complete collapse of private health care, a total collapse.That was Graham Richardson in 1998. A supporter of our introduction of a rebate for private health insurers.Mrs Macklin is no better. She talked about the millionaires, the new species of elite Australians—Macklin's millionaires. She said that families on $70,000 a year are the rich, the elite. Well I have got news for Mrs Macklin. Families on $70,000 a year, when two people are earning an income, are only earning the average weekly wage in Australia. It's a disgrace that the ALP takes its pettiness out on average Australians. (Time expired)10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—The time for the debate has expired.Question resolved in the affirmative.431110001CLERK ASSISTANTThe Clerk—Petitions have been lodged for presentation as follows:431175DT6Bartlett 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 additivespercentage of ingredientsnutritional informationcountry of origin food derived from genetically engineered organismsSenator BartlettDT6Senator Bartlett(from 75 citizens)431186FY5Denman Sen KayTo the Honourable the President and Members of the Senate in Parliament assembled:The petition of the undersigned shows that citizens of Tasmania think that the government's taxation package, including the goods and services tax, does not provide sufficient information nor detail and hence is open to inequitable application during its implementation.Your petitioners ask/request that the Senate should not pass the legislation until the following questions are resolved fairly and equitable for the citizens of Tasmania:1. How will the Government ensure Tasmania is treated fairly in comparison to the more affluent and larger States? Tasmania, on a per capita basis, has the highest unemployment, lowest average weekly wage, the oldest population, the greatest number of people dependent on government income support and the most decentralised population of any state of Australia. The Government's model for estimating the cost of the GST does not allow for the different economic and social patterns between states.2. How will the Government ensure families can afford good food which will be relatively more expensive in respect to `junk' foods whose price will decrease after the removal of sales tax? Tasmanians pay the highest costs for food in Australia and are among the worst health status population in Australia.3. How will the Government ensure that organisations and charities can continue to provide the necessary community services and support to disadvantaged citizens? Community organisations and charities in Tasmania will face a double jeopardy from the implementation of the Tax Package. It is predicted that poverty in Tasmania will increase and more people will be seeking extra assistance. At the same time organisations will have a reduced capacity to meet those needs because of increased administrative costs associated with compliance and in many instances reduced revenue because of the application of the tax to such things as membership fees and fund raising.4. How will Government ensure that service quality and scope of education, child care and health services can be maintained without increasing the costs of these services? The Government proposes that essential services such as education, child care and health will be GST Free. However, community based organisations offering these services will have increased costs arising from the extra administration and accounting requirements of the tax package.Senator DenmanFY5Senator Denman(from 86 citizens)431212HX5Woodley Sen JohnTo the Honourable the President and Members of the Senate in Parliament assembledWe, the undersigned petitioners believe that(a) a valid mandate does not exist for the introduction of a Goods and Services Tax (GST)(b) the Australian electorate was not adequately informed, prior to the 1998 Federal election, to be able to deliver a valid mandate(c) the overwhelming response to the Senate inquiry into the tax system confirms these beliefs(d) the findings of the Senate Inquiry have shown, over recent weeks, that the proposed GST will be a regressive tax instead of the intended tax reform. It is abundantly clear that the enactment of the GST will result in the rich of this country benefiting at the expense of the more than five (5) million citizens living near or below the poverty lineYour petitioners request that the Senate should:(a) reject legislation presented to the Senate for the enactment of a Goods and Services Tax(b) initiate a process, based on the findings of the Senate Inquiry, which should inform and enable the Australian electorate to deliver a valid mandate for a just tax system. This process to culminate in a referendum.Senator WoodleyHX5Senator Woodley(from 12 citizens)43125510000VICE-CHAIRMANTo the Honourable the President of the Senate and Senators assembled in Parliament.The petition of certain members of the La Trobe University community points out to the Senate the detrimental effects that Voluntary Student Unionism (VSU) legislation will have on the Students of La Trobe University.Draws to the attention of the Senate:If VSU legislation is put in place it will mean the end to vital services provided by Student Organisations such as:Child CareStudent RepresentationAcademic AdvocacyClubs and SocietiesLegal ServiceSport and Recreation EntertainmentDr Kemp states that this legislation will `ensure that all students have the same freedoms on campus that they have off campus'. This is currently the case.Membership of these organisations is already voluntary in that students may choose to be a member or not.Your petitioners therefore ask the Senate to reject the VSU legislation.The President10000The President(from 55 citizens)431210SF4Cooney Sen BarneyTo the Honourable the President and Members of the Senate in the Parliament assembled.Restitution: A Basic Human RightMore than fifty years after the holocaust, Jews around the world continue to fight for and receive restitution for material and non-material losses inflicted by the Nazi regime throughout Europe. More than fifty years after the Palestinian people were displaced and dispossessed by an exclusive Jewish state established in Palestine in the aftermath of Nazi atrocities in Europe, Palestinians are still being dispossessed, dispersed, and denied any kind of restitution. Restitution is a universal human right. Persons now fighting for restitution are therefore to be supported.We, the undersigned, believe that Palestinians, of whom two-thirds are refugees, also have the right of restitution, including the return of the rightful owners to their property as well as restitution for other material and non-material losses. Resolution 194, which recognises the right of refugees to restitution, has been reaffirmed one hundred and ten times by the United Nations. Further, as recently as November 1998, the UN General Assembly reaffirmed in Resolution 52/644 the principle, based on the Universal Declaration of Human Rights and international law, that Palestinian refugees are entitled to all revenues from their property.We appeal to all fair-minded people, governments, parliamentarians, human rights groups and particularly Jewish organisations, to recognise, support and call for restitution of Palestinians through the restoration of homes and properties to their rightful owners as well as restitution for other material and non-material losses. While restitution can never fully make amends for all losses, suffering, and crimes against humanity, restitution establishes a precedent which should prevent the repetition of such catastrophes in the future.Senator CooneySF4Senator Cooney(from 10 citizens)Petitions received.Notices43134313Senator Ellison to move, on the next day of sitting:That the Norfolk Island Amendment Bill 1999 be withdrawn from the Legal and Constitutional Legislation Committee and be referred to the Joint Standing Committee on the National Capital and External Territories for inquiry and report by 12 August 1999.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 the provisions of the Telecommunications Laws Amendment (Universal Service Cap) Bill 1999 be extended to 11 May 1999.Senator Hogg to move, on the next day of sitting:That the time for the presentation of the report of the Foreign Affairs, Defence and Trade References Committee on nuclear weapon and ballistic missile proliferation in south Asia be extended to 30 June 1999.Senator Eggleston to move, on the next day of sitting:That the Senate notes that:(a) the death of Arthur Boyd, AC, OBE takes from us one of Australia's finest artists and leading philanthropists;(b) Arthur Boyd was recognised as the Australian of the Year in 1995 for his contribution to art in Australia, his generous donations of his work to Australian galleries and his gift to the nation in 1993 of his two properties, Bundanon and Riversdale, now known as the Bundanon trust; and(c) Arthur Boyd was a major contributor to the evolving culture of the Australian people and his generous spirit will live on through his work and his beloved properties.Senator Carr to move, on the next day of sitting:That the Senate—(a) notes: (i) that the Government has continued to fail to adequately respond to estimates questions put on notice in 1999, namely, that on 24 March 1999, the closing date for answers to questions on notice relating to the Department of Education, Training and Youth Affairs, only 131 answers had been received to a total of 256 questions on notice, and (ii) that 32 questions on notice from the Employment, Workplace Relations, Small Business and Education Legislation Committee additional estimates hearings, continue to be outstanding more than one month past the closing date for answers; and(b) condemns the contemptuous attitude of the Minister for Education, Training and Youth Affairs (Dr Kemp) in reflecting the Government's appalling attitude towards the Parliament and its committee.Senator Allison to move, on the next day of sitting:That the Senate—(a) notes: (i) that 26 April 1999 was the 13th anniversary of the world's worst nuclear disaster, at Chernobyl in the Ukraine, (ii) that, in 1996, the United Nations described Chernobyl as a continuing humanitarian tragedy of international dimensions, and (iii) the documented and continuing impacts in the areas of health, mortality and morbidity rates, along with adverse environmental, social and economic consequences; and(b) urges the Australian Government to play its full and responsible role to address and ameliorate these ongoing problems.4313Ellison, Sen ChrisSenator ELLISON9X5WALPSpecial Minister of State10—I give notice 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 following bills, allowing them to be considered during this period of sittings:Criminal Code Amendment (Bribery of Foreign Public Officials) Bill 1999Criminal Code Amendment (Slavery and Sexual Servitude) Bill 1999Copyright Amendment (Computer Programs) Bill 1999.I also table statements of reasons justifying the need for these bills to be considered during these sittings and seek leave to have the statements incorporated in Hansard .Leave granted.The statements read as follows—STATEMENT OF REASONS FOR INTRODUCTION AND PASSAGE IN THE WINTER SITTINGSCRIMINAL CODE AMENDMENT (BRIBERY OF FOREIGN PUBLIC OFFICIALS) BILLEarly passage of this Bill is necessary so that Australia will remain in step with other countries of the OECD as they move to prohibit the bribery of foreign public Officials.. The USA, Germany, Japan, Korea, Canada and 7 other countries have already passed similar legislation designed to implement the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. Most other OECD countries have similar legislation in the process of being considered by their parliaments, so early consideration is necessary if Australia is to avoid criticism. It would be unfortunate if Australia was seen by the international community to be equivocal about opposition to corruption.(Circulated by authority of the Minister for Justice and Customs)STATEMENT OF REASONS FOR INTRODUCTION AND PASSAGE IN THE WINTER SITTINGSCRIMINAL CODE AMENDMENT (SLAVERY AND SEXUAL SERVITUDE) BILLEarly passage of this Bill is necessary as it is important that the Commonwealth Parliament should provide leadership to the States and Territories. The Commonwealth Minister for Justice and Customs has been urging State and Territory Governments to enact complementary laws. It is therefore important that the Commonwealth component Of the scheme be in place as soon as possible. Senators will recall a similar Bill was before the Parliament prior to last year's election, so there have already been considerable delays in enacting the type of protection the Government is seeking to provide for young people contained in the Bill.(Circulated by authority of the Minister for Justice and Customs)DRAFT STATEMENT OF REASONS FOR INTRODUCTION AND PASSAGE IN THE 1999 WINTER SITTINGSCOPYRIGHT AMENDMENT (COMPUTER PROGRAMS) BILL 1999This legislation will allow Australian businesses to decompile computer software for three purposes, namely, to make interoperable software and hardware products, to correct errors in software, particularly the year 2000 computer date problem (Y2K) and to test the security of their information systems. This amendment of the Copyright Act 1968 is a crucial step forward in creating a legislative environment that will benefit both the information industries, particularly the software development industry, and business in general in the information age. The government's decision has taken account of the 1995 report by the Copyright Law Review Committee which recommended the introduction of a limited right to decompile in certain circumstances.The government has decided that, with regard to error correction, the legislation will be retrospective to 23 February 1999, the date of the announcement of the decision, in an effort to assist companies resolve their Y2K problems.Foreign information technology companies have been able to decompile software and hardware to make interoperable computer programs for some years, placing the Australian information industries at serious competitive disadvantage. The European Communities adopted a Directive allowing decompilation in 1991 and the US Digital Millennium Copyright Act enacted late last year recognises US case law allowing reverse engineering. Several countries in the South-East Asian region have also realised the importance of allowing this exception to copyright infringement by appropriate amending legislation.Australian industry, particularly the information industries, has strongly welcomed the Government's decision and is anxious for legislative certainty regarding the scope of activities it might undertake as a result of the decision. This is of particular importance for achieving Y2K compliance. In the absence of legislation, industry currently can rely only on the media release announcing the decision.The recent impact of the `Melissa' virus demonstrates the importance of security analysts having access to tools to enable them to quickly identify, track and neutralise unauthorised access to computer systems. The decompilation amendments will help companies protect their information systems against attack.Urgent legislative action is necessary to allow decompilation so that industry has available to it as soon as possible another aid to combating the Y2K bug. With only eight months to go until the year 2000 anything that further helps Australian companies achieve Y2K compliance should be provided without delay. This legislation is also particularly timely with regard to its potential to boost the competitiveness of the Australian information industries.(Circulated with the Authority of the Attorney-General) 43154315Calvert, Sen PaulSenator CALVERT5F4TASLP10—On behalf of Senator O'Chee and the Standing Committee on Regulations and Ordinances, I give notice that, on the next day of sitting, Senator O'Chee shall withdraw business of the Senate notice of motion No. 1 standing in his name for six sitting days after today, for the disallowance of the Accountability Principles 1998 and the Accreditation Grant Principles 1998, made under section 96-1(1) of the Aged Care Act 1997. I seek leave to incorporate in Hansard the committee's correspondence concerning the principles.Leave granted.The correspondence read as follows—Accountability Principles 1998 and the Accreditation Grant Principles 1998 made under section 96-1(1) of the Aged Care Act 199718 February 1999The Hon Bronwyn Bishop MPMinister for Aged CareParliament HouseCANBERRA ACT 2600Dear MinisterI refer to the following Principles made under s.96-1(1) of the Aged Care Act 1997 .Accountability Principles 1998The Principles set out various aspects of the access to a residential care service which an approved provider of that service must afford to a person authorised by the legislation to undertake a review of that service.The note to section 1.8 points out that an approved provider who refuses consent to a representative's access to the service, or withdraws that consent, may suffer one of the sanctions referred to in Part 4.4 of the Aged Care Act 1997 . However, these Principles impose no obligation on a member of the Department, or a person seeking access to the service, to advise the provider of that fact. The Committee suggests that it may be appropriate for the Principles to require that such information should be given to providers.Section 1.12 forbids an approved provider from impeding access by a representative, and the latter's ability to make inquiries, so long as the access and questioning is relevant and necessary. The section does not, however, indicate who is to decide the relevance and necessity of that access or questioning, nor when a decision on those matters may be made. Accreditation Grant Principles 1998These Principles set out the procedures to be followed, and the matters to be taken into account, by the Aged Care Standards and Accreditation Agency when it assesses residential care services, and the conditions to which the grant of accreditation is subject.Subsection 2.6(1) permits the accreditation body to appoint a person to be an approved assessor, but does not provide for any qualifications or attributers that such a person should possess.Paragraph 2.6(2)(b) requires the accreditation body to ask the service to provide information relevant to the assessment, but does not oblige the service to provide that information. If it did so provide, there would appear to be no safeguards as to whether the provider of the service should be required to incriminate him or herself, nor whether the provider may be assisted by a legal representative, nor the nature of the sanctions for refusing to comply with the request.Section 2.8 permits the accreditation body to distribute an assessor's report to `anyone who asks for a copy', without any limitation which might be required for the protection of the privacy of the service which has been assessed.Subsections 2.9(4) and (5) grant to the accreditation body the discretion to decide whether a residential care service complies with the Residential Care Standards. It may be suggested, however, that there is no need for independent review of the exercise of this discretion, since the decision of the accreditation body has no effect of itself. All that this body can do is to recommend to the Secretary that sanctions be imposed under the parent Act, and if the Secretary makes such a decision, it is reviewable under Part 6.1 of the Act. In such cases, the Committee considers that service providers should be advised of their rights of review before an accreditation body commences an inspection in the process of coming to a recommendation.Subsection 2.9(5) requires the accreditation body and the service provider to agree on various matters. The subsection would appear to express no more than a hope, rather than an enforceable obligation, and indeed subsection 2.9(6) recognises that agreement may not be reached. Perhaps subsection 2.9(5) could be expressed more accurately.Subsection 2.9(7) permits an accreditation body to continue to supervise a residential care service while the Secretary is considering his or her decision. It is not clear whether this continued supervision includes the right of the accreditation body to enter the relevant premises. Without a right of entry, the supervision would appear to be of little value, but if there is an implied right of entry, there are no safeguards to protect the provider of the service. The Committee would be grateful for your advice.Yours sincerelyBill O'CheeChairmanMinister for Aged CareParliament HouseThe Hon Bronwyn Bishop MPCanberra ACT `600 Telephone: (02) 6277 7280 Facsimile: (02) 6273 4138Senator W.G. O'CheeChairmanStanding Committee on Regulations and OrdinancesParliament HouseCANBERRA ACT 2600Dear Bill,Thank you for your letter of 18 February 1999 concerning questions on the Accountability Principles and the Accreditation Grant Principles arising from the Senate Standing Committee on Regulations and Ordinances (the Committee).As you may know, these abbreviated Principles were gazetted on 22 July 1998 to ensure that the accreditation body, the Aged Care Standards and Accreditation Agency (the Agency) and its staff are covered for the purposes of monitoring residential aged care services. The Agency has no accreditation capacity until the full version of the Accountability Principles and the Accreditation Grant Principles are approved. The full versions are currently being prepared.The abbreviated Accountability Principles and Accreditation Grant Principles will be repealed and replaced with the full versions once these are approved.My response to the matters raised by the Committee, in the order that they were raised in your letter, is as follows.Accountability Principles 1998Section 1.8The Committee refers to the note to section 1.8 which points out that a refusal of an approved provider to give consent to access to a residential care service by a representative could constitute a failure to comply with responsibilities in relation to accountability under Part 4.3 of the Aged Care Act 1997 (the Act).More specifically, I note that it is a responsibility:. under paragraph 63-1(1)(j) of the Act to allow persons authorised by the Secretary access as required under the Accountability Principles to review the certification of a service; and. under paragraph 63-1(1)(l) of the Act to allow people acting for accreditation bodies access to a service as specified in the Accountability Principles, and. under paragraph 63-l(l)(m) of the Act, to comply with `with such other responsibilities as are specified in' the Accountability Principles.However, it should be noted that section 1.13 of the Accountability Principles sets out a number of circumstances in which refusal to give access does not constitute a failure to comply with responsibilities under the Act.Where there is such a failure by an approved provider to comply with responsibilities under the Act, it renders an approved provider liable to possible sanctions action under Part 4.4 of the Act. Given this, the Committee's suggestion that the Accountability Principles should require that approved providers be informed of this (presumably at the time access is requested) is appropriate.I agree with the Committee' s suggestion and consider that it could be accommodated by requiring that the letter giving notice of intended access in section 1.7 refer to the fact that failure to consent could lead to sanctions action. Representatives permitted under subsection 1.7(2) to give notice orally could also be required to state this. Further, there could be a requirement in section 1.9 that the letter of authority identifying a representative also state that a consequence of failure to consent to access could, in some circumstances, lead to sanctions action.Given that the full versions of the Accountability Principles and the Accreditation Grant Principles are currently being prepared, I propose to instruct the Department to put these requirements into effect administratively until they can be incorporated into the full version of the Accountability Principles.Section 1.12 The Committee refers to the prohibition of an approved provider from impeding a representative's access and ability to question various persons where this is `relevant' and `necessary' as set out in section 1.12. The Committee notes that there is no indication of who decides such relevance and necessity.However, this provision has to be read with paragraph 1.13(c) which provides that it is not a failure to comply with responsibilities as an approved provider to refuse access to a representative `because the representative's conduct is inconsistent with section 1.12'. Requirements of relevance and necessity in section 1.12 are therefore stated in objective terms.If sanctions are imposed for failure to comply with section 1.12, it will be the Secretary's delegate deciding this who will address what was relevant and necessary. That delegate's decision would also be subject to internal review and review by the Administrative Appeals Tribunal under section 85-8 of the Act.Accreditation Grant PrinciplesSubsection 2.6(1)The Committee points out that the `approved assessor' who must assess a residential care service is merely, as defined in section 2.3, a `person approved as an assessor for a residential care service' There is no specification of the criteria for such approval such as the qualifications required for approval.I accept that approved assessors exercise important functions of gathering evidence upon which decisions of considerable significance to approved providers and care recipients will be made. That evidence may well later fall to be considered by the Administrative Appeals Tribunal or the Federal Court. I therefore agree with the Committee that the qualifications of assessors should be specified. I will ensure that appropriate provision is made for this in the full version of the Accreditation Grant Principles.Section 2.6(2)(b)The Committee notes that the accreditation body before an assessment must ask the residential care service `to provide any information relevant to the assessment' but that there is no obligation on the service to provide that information. The Committee then points out that, if there were such an obligation, it would appear necessary to have safeguards against self incrimination.I note the Committee's comment on these matters. However, by providing such information, the residential care service is more likely to assist its own cause than by not providing relevant information to the assessor.Section 2.8The Committee points out that a copy of the assessment report must be given by the accreditation body to anyone who asks for it without there being any limitations having regard to the privacy of the service which has been assessed'.I note that the accreditation body must also publish the assessment report (section 2.7). Further, section 86-9 of the Act authorises the Secretary to make publicly available the kinds of information there specified about an aged care service. These include:. information about the service's status under this Act (for example, the service's . . . accreditation . . . record); and. `information about the approved provider's performance in relation to responsibilities under (the) Act' (paragraph 86-9(1) (k) and (l), respectively).The material in an assessment report would be expected to fall within these descriptions, and to that extent, copies of the report could be made available by the Department. Because the making public of such information is a function of the Secretary under the Act, the function will need to be delegated to the accreditation body under subsection 96-2(6) of the Act. Given this, there seems no reason why there should not be an express provision in the Accreditation Grant Principles permitting an accreditation body to release the assessor's report.The protected information provisions in Part 6.2 of the Act apply to an accreditation body in relation to information acquired in the performance of duties under the Act. Where the accreditation body is performing functions of the Secretary as specified in the Accreditation Grant Principles (in accordance with paragraph 80-l(l)(b) of the Act) information acquired in so doing is protected information under the Act. The assessment of compliance with Residential Care Standards is such a function. Therefore, the protected information provisions of the Act not only authorise the making public of the relevant kind of information, but operate generally to protect it in the hands of an accreditation body.I have been advised that the publication of similar reports (to those proposed to be published under section 2.7 of the Accreditation Grant Principles) was permissible under the National Health Act 1953 (subsection 45DA(2) in particular). The rationale for such provisions is that it is in the community's (and especially care recipients' and their relatives') interest to be fully informed about standards at relevant residential care services so they can make informed decisions about residential aged care.Subsections 2.9(4) and (5)The Committee refers to the requirement that the accreditation body `recommend to the Secretary that sanctions under the Act be imposed' if it is not satisfied at the conclusion of an improvement timetable that the level of care provided by a residential care service complies with residential care standards. The Committee points out that such a recommendation has no effect of itself. Any subsequent sanctions action will be reviewable under Part 6.1 of the Act. The Committee considers `that in such cases' service providers should be advised of their review rights `before an accreditation body commences an inspection in the process of coming to a recommendation'.However with respect, the accreditation body does not know, nor could it know, before commencing an inspection that the case is one where a recommendation of sanctions' action by the Secretary' s delegate will ensue. In the vast majority of cases, this would not be expected to be the result. In addition, Part 4.4 of the Act contains detailed provisions for the giving of notices as an integral part of procedures for the imposition of sanctions by the Secretary's delegate. In my view, there is ample opportunity for approved providers to be informed of their rights should a case reach such a level.Section 2.9(5)The Committee refers to the requirement that the accreditation body and the approved provider `must agree' on arrangements for the supervision of the service. If agreement is not forthcoming, the accreditation body under section 2.6 must tell the Secretary and recommend that sanctions be imposed. The Committee is suggesting that the words `must agree' are inappropriate for something which, it is recognised, may not occur.While I accept that words such as `must attempt to agree' would be more appropriate, I note that no legal consequences flow from this. However, I will ensure that this matter is considered in the preparation of the full version of the Accreditation Grant Principles.Section 2.9(7)The Committee refers to the function of the accreditation body of continuing to supervise the residential care service while the matter of a recommendation by the accreditation body to impose sanctions is being considered by the Secretary. The Committee says that it is not clear if this involves an implied right of the accreditation body to enter the relevant premises, and that, if it does, there are no safe-guards for the approved provider. The Committee also says that without such an implied right the `supervision would appear to be of little value' .In supervising a residential care service, the accreditation body would rely on the same authorisation, based on the consent of the approved provider, contained in the Accountability Principles, as in carrying out its other functions. There is, having regard to those Principles and related provisions of the Act, no implied right to access conferred by this provision. In the event that, notwithstanding that sanctions under the Act could ensue, consent to entry is not forthcoming, it would be necessary for an authorised officer acting under warrant obtained under Division 92 of the Act to exercise monitoring powers under the Act.Should you or the Committee wish to discuss any of these matters further, I and my staff would be more than happy to do so.Yours sincerely(Signed)BRONWYN BISHOP13/4/994318Senator Calvert, at the request of Senator Ferguson to move, on the next day of sitting:That the time for the presentation of the report of the Economics Legislation Committee on the provisions of the Taxation Laws Amendment Bill (No. 4) 1998 be extended to 13 May 1999.4318Motion (by Senator Allison) agreed to:That business of the Senate notice of motion no. 3 standing in the names of Senators Allison and Margetts 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 2 sitting days after today.Motion (by Senator O'Brien, at the request of Senator Jacinta Collins) agreed to:That general business notice of motion no. 162 standing in the name of Senator Collins for today, relating to the introduction of the Employment Security Bill 1999, be postponed till 29 April 1999.Motion (by Senator Crossin) 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 the next day of sitting.Motion (by Senator Allison) agreed to:That general business notice of motion no. 136 standing in the name of Senator Allison for today, relating to the appointment of a Select Committee on Superannuation and Financial Services, be postponed till 2 sitting days after today.Motion (by 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 the next day of sitting.Leave of Absence4318Motion (by Senator O'Brien)—by leave—agreed to:That leave of absence be granted to Senator Schacht for 28 April 1999, on account of absence on parliamentary business overseas. Committees4319431943194319The DEPUTY PRESIDENTThe DEPUTY PRESIDENT10000PON/A10—The President has received a letter from the Leader of the Opposition in the Senate seeking a variation to the membership of a committee.Motion (by Senator Ellison)—by leave—agreed to:That Senator Crossin replace Senator Collins on the Employment, Workplace Relations, Small Business and Education Legislation Committee, for the consideration of the provisions of the Higher Education Legislation Amendment Bill 1999.Bills4319r7184319Bill received from the House of Representatives.Motion (by Senator Ellison) agreed to:That this bill may proceed without formalities and be now read a first time.Bill read a first time.431915:47:004319Ellison, Sen ChrisSenator ELLISON9X5WALPSpecial Minister of State10—I table a revised explanatory memorandum and move:That this bill be now read a second time.I seek leave to have the second reading speech incorporated in Hansard .Leave granted.The speech read as follows—This bill follows up last year's youth allowance package. That package consisted of two substantial acts and several pieces of subordinate legislation, including three major ones relating to the fares allowance for students, the student financial supplement and the youth allowance family actual means test.Those three matters were addressed at the time in subordinate legislation only because of the time constraints imposed by the youth allowance package. As was always intended, those provisions are now to be moved into the Social Security Act itself, by this bill. The provisions are to be moved in this way without generally making any change in their effect. This, of course, was also the aim when moving the provisions last year from the former AUSTUDY structure into the social security system, so that students did not suffer any disruption to their payments half way through the academic year. However, certain drafting and other minor refinements are to be made now, including to ensure that the original AUSTUDY provisions are correctly reflected.The other main purpose of the bill is to deal with several technical issues that were identified during the implementation of the youth allowance package. Again, these reflect the original AUSTUDY policies and generally consolidate the operation of the package.The bill also makes minor consequential amendments to relevant tax and data-matching legislationI commend the bill to the Senate.Ordered that further consideration of the second reading of this bill be adjourned till the first day of sitting in the winter sittings 1999, in accordance with standing order 111.Committees43194319431915:48:004319Allison, Sen LynSenator ALLISON1M6VICAD00—I move:That the following matters be referred to the Environment, Communications, Information Technology and the Arts References Committee for inquiry and report by 30 May 1999:(a) the approvals process for the Jabiluka uranium mine project, including both the Ranger Mill and Jabiluka Mill options and the appropriateness of the process, including but not confined to the independence of the process, the level of assessment, the timing and content of decisions and the capacity of the assessments to deal with world heritage obligations and impacts;(b) whether an inquiry under section 11 of the Environment Protection (Impact of Proposals) Act 1974 is now warranted in relation to the project;(c) whether Australia is appropriately fulfilling its international obligations in relation to the protection of the Kakadu National Park World Heritage Area in relation to the project; (d) whether Australia is appropriately fulfilling its international and domestic obligations in relation to radiological protection in relation to the project; and(e) the rights of traditional Aboriginal owners over the area and the extent, appropriateness and outcome of consultation with the tradition owners.The Australian Democrats are moving to refer to the Senate Environment, Communications, Information Technology and the Arts References Committee the matter of the approvals process for the Jabiluka uranium mine because of the failure of the government to follow proper process or even to deliver on its own procedural promises—and I refer to the 77 strict and stringent conditions so-called which would apply to the mine before it could commence. We need to look no further for reasons to question the EIS process on Jabiluka than a document which was prepared by four eminent and independent scientists and professors at the Australian National University. A document that was prepared by this group stated: The review of the Draft EIS and Supplementary EIS was handled entirely by Environment Australia, with advice given directly to the Minister for the Environment, Senator Robert Hill. There was no review of the EIS independent of the Commonwealth bureaucracy or the Minister's office.. . . . . . . . .The EIS should have been treated as a scientific document and subjected to peer review by scientists not bureaucrats who, despite their skill and experience, are not professional scientists able to review complex scientific issues.They also said on the matter of the proposal to mill at Jabiluka:The announcement that ERA wishes to mill ore at Jabiluka rather than at Ranger, as assessed in the EIS, should have been met by the Minister for an immediate requirement for a fresh EIS. Instead, the Minister has not required a new EIS. This is not acceptable, as the proposed construction of a mill at Jabiluka raises a wide range of new environmental issues that must be assessed.The Minister for the Environment and Heritage has said repeatedly that the problem the government and the mining company have always had with the cultural heritage management plan is that the traditional owners would not cooperate. A management plan was prepared but without the involvement of the Mirrar people and, not surprisingly, it is totally unacceptable.Kakadu was included on the world heritage list for its cultural and natural values. These are, of course, not separate. Aboriginal people have been present in Kakadu for around 40,000 years as far as we know—no doubt one of the longest examples of continuous human habitation in the world—and their ancient culture is unique and integral to the landscape. This government, however, seems happy to foster prejudices and cynicism about sacred sites. I would strongly urge the minister not to go down this path.I would also urge the minister to remember that the rest of the world is watching the way in which this government is dealing with native title and Jabiluka and that it does not share the coalition's cynicism about Aboriginal culture. Aboriginal culture has been largely destroyed in this country and what remains is of enormous importance not only to the Mirrar people—who are, after all, acknowledged by the Federal Court as the traditional owners—but also to the international community. The treatment of the Mirrar people by the minister in the approvals process for Jabiluka was, as I understand it, central to the investigating team's recommendation for listing Kakadu as world heritage in danger. In October, recommendation No. 3 of UNESCO was:Further encroachment on the integrity of Kakadu National Park through uranium mining and the associated incremental expansion of urban and infrastructure development in and associated with the town of Jabiru, located within the World Heritage property, should be prevented.Recommendation No. 4 was:The mission recommends that the Jabiluka Cultural Heritage Management plan should be as thorough as possible. It should be prepared according to international best practice in cultural heritage management . . . and every effort should be made to ensure thorough participation, negotiation and communication with traditional owners, custodians and managers to ensure the compilation of an accurate cultural inventory that will ensure the conservation of the cultural sites located within the Jabiluka Mineral Lease. Recommendation No. 5 was:The mission recommends, as an utmost priority, exhaustive cultural mapping of the Jabiluka Mineral Lease and the Boyweg site and its boundaries to ensure protection of these integral elements of the outstanding cultural landscape of Kakadu. This survey and cultural mapping work should be undertaken by senior anthropologists working with Aboriginal custodians . . . and subject to expert scrutiny via objective and impartial peer review.The Mirrar people met with the minister and the Department of the Prime Minister and Cabinet last February. At the meeting with the minister, senior traditional owner for the Mirrar, Yvonne Margarula, explained in some detail the nature of the Boyweg Almudj sacred site and the consequences for the Mirrar of the disturbance of that site. At that meeting, Ms Margarula asked the minister to stop the construction of the mine to allow the Mirrar to assist in identifying and mapping their sites. As I understand it, the government gave an undertaking to the UNESCO world heritage group that it would do just that.How does the minister expect the Mirrar people to go onto the site to do the mapping that is required when there are daily explosions in and around the mine site? Furthermore, Senator Bolkus and I were told some weeks ago by the miners that very soon they will be taking the decline beneath the Boyweg site and that, according to the map they showed us, the designated sensitive site covers most of the ore body. The boundary will soon be breached by the spiralling tunnel which will allow diamond drilling in the ore body and construction of the shafts.The Mirrar people, through Yvonne Margarula, have given the minister written assurances that discussions will be reopened on the management plan as soon as construction is suspended. As we know, that has still not happened. The minister said recently that agreement to go ahead with Jabiluka was reached by the traditional owners, supported by the Northern Land Council. Earlier last month, Yvonne Margarula asked the minister to correct that statement that he is so fond of making. In 1991, the Mirrar people were advised by the NLC that there was no legal ability to prevent the sale of the Jabiluka mineral lease from Pancontinental to ERA. There was no approval because they understood that there was no ability to deny that transfer.What sort of process would allow work to go ahead which might prejudice the outcome of the cultural management plan? How can the Mirrar people be involved in detailed mapping when explosions are happening daily at the mine site? Cultural heritage and details about sensitive sites do not just exist in a book in a library somewhere. They are held by the people, many of whom still live a very traditional lifestyle in this part of the Northern Territory.Professors Mulvaney, Wasson, Mackey and White from the ANU pointed out some other flaws in the EIS process. They said that the EIS largely ignored cultural heritage. They pointed out:It is evident that ERA had not held detailed consultations with relevant Traditional Owners—that is reported in appendix 2 and appendix 3 of that document—to liaise with them concerning sacred sites and their management plan, some archaeological surveys had been undertaken. Therefore, we must infer that there was inadequate basic data for assessment of development proposals.They went on to say:It is standard practice for an EIS to include such survey data. It is unacceptable to promise to undertake surveys subsequently, and at the same time to claim `areas of mine site and haul road have no known features of significant cultural heritage value. Detailed surveys are required however when access is permitted.As they said, this is a very cavalier dismissal of the potential impact of mining on cultural places yet to be recorded and yet to be documented. They continued:Despite the opposition of the Senior Traditional Owners of the Mirrar Gundjehmi clan, ERA argues that this is largely negated because of the approval in 1982 of the previous Senior Traditional Owner and consent in 1991 to ERA's acquisition of the project.Those consents were obtained in very different contexts, before the reality of landscape impacts could be comprehended. It is not unreasonable to expect that current proposals could raise concerns with the actual owners of the area, given the early contact with development in the area was restricted to waterbore and mineral exploration drilling. This is a much more limited activity than establishing a mine.They went on to say:ERA emphasises that other clans and landowners have expressed support for mining. This is irrelevant, as they are not the owners directly concerned.. . . . . . . . .The right to spiritual information in Aboriginal society is a source of power, prestige and kinship relations, together with deep spiritual mystery. Its disclosure is both personal and complex socially, involving obligations which non-Aboriginal people find difficult to understand.Those are some of the many criticisms that Professors Mulvaney, Wasson, Mackey and White made of the process so far and of the government's position. The government's response to this critique was to try to attack the integrity of the professors, and I understand that a fruitless exercise was instigated to see whether some dirt could be dug on those academics. These are all the reasons why the Senate must now inquire further into the decision making process of ERA and of the government. That decision making was flawed and it is still flawed. The problem will not go away, as the minister would no doubt like it to.The Senate Environment, Recreation, Communications and the Arts References Committee has just completed an exhausting program of references, but its program is now complete and it is free to take on an important inquiry such as this. No doubt the government will not want this inquiry, but opposition members of the committee welcome the chance to do a proper investigation into what is a blot on Australia's copybook.16:00:004322Bolkus, Sen NickSenator BOLKUSXE4SAALP00—The opposition supports this motion because we also believe that there are some serious issues in relation to this matter that need to be assessed by the parliament. We are also concerned about those issues that Senator Allison has raised in her contribution this afternoon. I do not think there is any doubt that the government's approval process in respect of Jabiluka was both quick and dirty. It was unacceptably quick. They acted with indecent haste and they acted just before the calling of a federal election to grant approvals for this particular project. It was dirty in that it was fast-tracked and it did ignore important cultural and environmental issues relating to that particular area. Senator Allison quite eloquently put on record the problems in respect of indigenous Australians and how they have been ignored and how they continue to be ignored on the proposal to mine Jabiluka. The other aspect about this proposal and why I call it dirty is that, in coming to give the approvals, the government actually overrode the concerns of the minister's own department, Environment Australia. On a whole range of grounds, one could say that the process and the final decision with respect to this mine were indefensible.It has got to be said that the government has enormous problems in defending it, both at home and abroad. If you look at the public view at home, you can see that poll after poll shows that the Australian public is not in support of the Jabiluka mine at Kakadu. If you look at the way the rest of the world is seeing the government's decision to proceed with mining at Kakadu, you have only to look at the views of the world's most eminent scientific body, the UNESCO World Heritage Committee, a body which has taken a position of enormous concern in respect of this proposal, both on environmental and cultural grounds.We have been asked to make a decision in the Senate to take an interest in this particular approval process. I think it is important for us to do so not because of the immediate points of concern—overriding the department's concerns, overriding the views of indigenous Australians, the processes and so on—but also because we need to fulfil our responsibilities as a national parliament. What we are talking about here is an issue of world heritage values, is an issue of how we treat our world heritage property and is an issue which the rest of the world is obviously taking an interest in.It is not just the World Heritage Committee taking an interest over the last few months or so. Last week, for instance, we saw the two major activists, I suppose, opposing the mine, Jacqui Katona and Yvonne Margarula, receiving an internationally respected award, the Goldman Award, for their environmental protection actions. They went to San Francisco to accept an award that is not only worth a lot of money but also recognised internationally as one of the pre-eminent international environmental awards. They got that award in San Francisco, and then they moved on to Washington where they were at the hub of attention of leaders in the USA. That is the most recent example of the world showing an interest in how we are protecting our world heritage property at Kakadu.Given the concern at home, given the fact that we will continue to be subjected to international scrutiny for how we handle this particular area, I think it is important for the national parliament to take an interest and to see whether the government is meeting its responsibilities. It is not just an issue that impinges upon the reputation of this government. If that were the case, we would not have the concerns that we have. It is because this is an issue which also impinges on the reputation of Australia and how the rest of the world sees Australia. That is something that we underestimate in debate in this place too often. The way the rest of the world sees us is the way that they will then continue to assess what we put on the international table in our national interest. If we basically turn a blind eye to this issue and say, `The government has done it, so be it,' that will not meet the concerns of the international community when we front them with our national interest issues.In terms of the actual process, what are our concerns? We believe that the adequacy of the approvals process, which has already allowed construction to begin at Jabiluka, is highly questionable on three grounds: the assessments process, the application of environmental conditions and the devolution of responsibility for compliance to basically what is a provincial government, the Northern Territory government—a government without sufficient protection and a government which has shown little interest in environmental issues over the last 20 years or so.Turning to the assessment process, the responsibility for conducting assessments and for granting approvals for uranium mining lies with the Australian government, and we believe that is appropriate. Environmental and other duties may be devolved to state or territory governments as a matter of policy, custom and practice, but the ultimate responsibility does lie with the federal government. Given the fact that we are talking here about mining in a world heritage area, we believe that the federal government should show a keen interest in how the process, if it is to be approved, will be approved and, secondly, how the process is to continue.We have been concerned about the assessments process because of a number of factors. First, the record shows that there was a desperate and hasty decision to permit the proponents to meet the requirements of the tailings disposal part of the process, for instance, by returning 100 per cent of tailings to the pit. This was an extraordinary decision in any sense of the word. It was a decision that was announced on 25 August, just prior to the federal election being called. The tailings disposal method was not a proposal which emanated from the proponent and evaluation of its merits or risks had not been undertaken in any full way or in any manner open to public participation or scrutiny. We believe that this hasty, dirty approval was inappropriate and indeed indefensible. The long-term radiological and environmental hazards posed by uranium tailings and the intensely problematic nature of their management are well documented, and we believe that they deserved a far more rigorous approach to scrutiny than the current federal government has demonstrated.Secondly, we have serious and searching concerns as to basically the questions that had been asked by the federal government's own agency, Environment Australia. They raised issues in respect of the tailings management and those issues have seemingly not been addressed in the approvals assessment. Indeed nothing about the adequacy or safety of the last-minute tailings decision has been fully scrutinised. Neither the environmental impact statement nor the lower level public environment report assessed this particular option.We have concerns as to the question of the soundness of the geological substrata and about the difficulties in achieving secure containment of leachate from the radioactive tailings posed by the permeability of the local geology. Senator Hill comes in here and says there has been a mine in Kakadu for so long and asks why we are concerned. We are concerned here because of the juxtaposition of this particular mine and important waterways. I think it is fair to say that third party views and assessments of this particular project from leading scientists have expressed the same concern we have expressed continually in respect of this particular project.We have concerns that the original advice from Environment Australia to Senator Hill was not made public until some weeks after the decision, many weeks after the federal election and indeed after the visit by the mission. We have concerns that that advice from Environment Australia was not seriously taken into account. We have concerns that the failure to exercise the highest level of environmental assessment for the proposed Jabiluka mill option represents a serious flaw. The PER which was adopted by the government is a low level of assessment, a level of assessment which does not allow for public participation and scrutiny. We believe an EIS should have been the absolute minimum assessment mechanism and that this was probably the view of quite a number of people involved in advising government as well.We are concerned that the project should not have been commenced in the construction stage prior to the completion of the PER. This is a serious matter. Not only is there an increased perception of haste but, more importantly, the risk of actual damage has been heightened. Again, in terms of that fast-tracking we ask whether the concerns of indigenous Australians were even taken into account. We have a situation almost at the moment where mining progress at Kakadu and Jabiluka is such that areas that are claimed by indigenous Australians, the traditional owners, to be sacred sites are being impacted upon—not as the company or Senator Hill would tell you—maybe not above ground but at least underground. If one looks at indigenous religion in this country, in most circumstances one cannot divorce sacred sites from their above and below ground values.We are concerned—and I think this is a concern that should be held by all senators here—that fast-tracking has been the guiding principle and that, as a consequence, approval has been given before the finalisation of some 70-plus conditions which were recommended by the federal environment minister, or should I say probably more accurately by his department to him. They were concerns that he promoted for at least some time before the minister for resources basically sat on him. So they are some of the assessment process considerations that we have. They are some of the reasons why we think the assessment process was not adequate.We also have concerns as to the ongoing environmental conditions that were imposed by this government on the mining project. The requirements proposed by Environment Australia, originally deemed to be mandatory, were systematically diminished by this government at the behest of the previous minister for resources. We had, for instance, Environment Australia coming up with a whole raft of preconditions and conditions as to the mining. We had them recommending to government that those conditions and preconditions should have some substantive force behind them. But what we got from the previous minister for resources and what has been accepted by the current minister for the environment is a regime which basically allows for either self-regulation by the company or oversight by the Northern Territory government, a government which has never seen—and fulfilled—its responsibilities to the environment.The reduction in standards of environmental management can be seen in the determination of the minister for resources when he says that the proponent must not be bound by these conditions but take into account certain matters. For us that is not good enough. We are of course concerned as to the devolution of authority. We are talking here of a uranium industry in a world heritage area. It is just not good enough to write out of the equation continuing federal government oversight and it is not good enough to water down condi tions and preconditions into basically just taking those concerns into account.We are concerned, for instance, that the requirement that the Supervising Scientist, who is the responsible Australian government agency, be satisfied on environmental questions has been deleted by the government from its initial raft of imperative conditions and has now been replaced basically by monitoring in the hands of the supervising authority of the Northern Territory Department of Mines and Energy. That has to be of concern to all of us. I think it is also reflective of the systematic diminution of standards of scrutiny and accountability.They are some of the concerns that we have, but we are concerned even more when we look at the documentation which was available to Senator Hill. We are concerned about the concerns that Environment Australia had which were actually transmitted to the environment minister as part of the advice that was presented to him by his own department. There are a number of things that Senator Hill talks about in terms of the mine at Jabiluka and Kakadu, but there are a number of things that he does not tell you about. The main things that he does not tell you about are the things that went to him by way of advice from his own department. What Senator Hill does not tell us is that he was advised:. . . there is an element of uncertainty because of the current inadequacies of the baseline data.That is, uncertainty as to how to proceed with an assessment of the proposal. What he does not tell us day after day in question time is about the advice from his department at page 40 where they say:Because soil surveys have not been conducted at the site, it is uncertain as to whether sufficient material is available to form a compacted base. . . They have concern about the mine operation. They have concern about alternatives. They have concern about water management. They have concern about the inadequacy of baseline data required for assessment of the proposal. That is on page 48. They have concern about the hydrology. They state:The degree of connection between the deep and shallow aquifer systems was not able to be defined by [ERA] from the available data.They have concern about water quality:Baseline water quality data is largely absent [in the Environmental Impact Statement] and at the very least does not cover a minimum of one year . . . This is on page 52 of their advice to the minister. They are concerned at the degree to which the flora and fauna of the area has been taken into account by the approval process. Environment Australia says:Environment Australia does not consider that the flora survey conducted by helicopter—would you believe it?—[for the Environmental Impact Statement] constitutes an appropriate study of vegetation potentially affected by the project.Yet we have Senator Hill coming in here day after day blackguarding the international UNESCO committee for their assessment—and our assessment—of the proposal, when the flora and fauna survey in respect of this project was conducted by helicopter. Environment Australia goes on to say:. . . there is little commitment [by ERA]—this has to be an understatement—to undertake a survey on fauna . . . I suppose if you allowed them another helicopter ride they might just do it. Environment Australia have concerns about the natural and cultural values. They stated:The wetlands of Kakadu were a primary reason why the region was inscribed on the World Heritage List, yet it is their proximity to the proposed Jabiluka mine which makes protection of water quality and quantity a major ecological issue.No, Senator Hill, there is a big difference between this proposal and Ranger. Your own department has told you that the proximity of this particular mine to the waterways is a matter of major ecological concern, and that is something that any full inquiry of the Senate would have a good look at. In this place we get used to the government disregarding and dismissing the concerns of indigenous Australians but, unfortunately for them, the rest of the world does not. And, unfortunately for the minister, his own department did not when, on page 59 of its advice to the minister, it said:Baseline anthropological and archaeological studies have not been undertaken for the specific purpose of this project.On page 59 they say:. . . first hand knowledge of sacred sites has not been available . . . They go on to say:The Jabiluka Lease area has high cultural values, containing significant religious sites, stone quarries, burial sites, at least 196 art sites and a range of archaeological sites, including the site known as Malakunanja II [which] could be [one] of the oldest in Australia, and may be as old as 50-60,000 years before present.These are concerns that the Senate is entitled to have, and these are concerns that the World Heritage Committee has, but these are concerns that this government does not have. I could go on, page after page, with concerns expressed by the minister's own department. And I can also allude to how conditions which were recommended by the department, conditions which were pursed by Senator Hill, were watered down to basically expectations in a regime of self-regulation and oversight by a Northern Territory government which has no interest at all in environmental concerns and which has shown no such interest for a long time.The department, for instance, says that there is a lack of baseline data which prevents a full consideration of the proposed management approach to cultural heritage at this stage, and there still has not been a cultural management plan. The government has not accepted an offer by the traditional owners to be involved in one if the government was prepared to participate in terms of providing some funding for that.So we have a proposal here which should not just be of national concern. It, quite validly, is of international concern, because we are talking about a mining proposal in an area of world heritage listing. Were this area to be listed on the endangered list of the World Heritage Committee, then we would be facing in Australia an issue of immense proportions, because it would be on an international list, international attention would continue to be drawn to it, and international condemnation would continue to be attracted not just to the government but to this country, and—I finish on this point—also to this particular company. If ERA want to do business worldwide, the last thing they would want is to be listed as a proponent for this particular mining site.All of these matters, I think, lead to the one firm conclusion: that Senator Allison's motion before the Senate today, raising concern about the approval process, is not only one that is open to be approved but one that I think is important for all of us in this place to support, because we are really stepping down a rocky road of international condemnation if we do not handle this issue properly. The government will not do it. It is incumbent on the Senate, I think, now to show the responsibility in this area that the government has not shown.16:20:004326Margetts, Sen DeeSenator MARGETTSDX5WAG(WA)00—We are being asked to look at a proposal for a reference to the Environment, Communications, Information Technology and the Arts References Committee in relation to the Jabiluka uranium mine proposal. It is quite clear from the information that has been given to the Senate over more than one year—in fact, for some time now—that there is a problem, and this has been considered to be a serious problem, with the process by which this mine has been given approval.We know that that area of the world has been considered to be quite important by some elements of business for some time. I remember seeing elements of environmental policies for a number of industry groups which basically said that their aim was to get back Coronation Hill for mining. Of course, that was not to be, because the previous government handed back Coronation Hill to the traditional owners. So there was still this desire by the coalition to get a specific decision within the Kakadu region so that they could show industry that they were strong. That is my belief. I think that this is what this is about. We are talking about an area which is considered and recognised by most Australians to be part of one of Australia's environmental icons. Whether or not there has been a line drawn and excised around the lease area is irrelevant to the fact that the area itself, the Kakadu region, is considered to be one of the most important environmental icons in Australia.I understand that some time ago the Resource Assessment Commission looked into what average Australians valued in relation to the Kakadu region. They found out that there are people in Australia who may never have been to Kakadu but who would be willing to pay money for the government not to make decisions to ruin that area. I find that extraordinary, but that is the kind of outcome that was found by the Resource Assessment Commission in relation to Coronation Hill. There is, I would say, quite a substantial increase in people's emotional attachment to the Jabiluka area. It is important for various ecological reasons and it is extremely important for living cultural reasons in that area. Yet, this government has decided that, no matter what information it is given, no matter what the opinion of the senior traditional owner and no matter what evidence is given to the government, it will stick by the process of giving ERA approval to mine in the area.I have flown into the area with tourists from other countries who cannot believe that the government would be so stupid as to not only maintain an existing mine but also put in another mine. I have been invited by the senior traditional owner and other members of the Mirrar clan to see some of the country, not the actual mine site but some of the country close by. Part of that country includes wetlands which used to be occupied by the old Djar-djar lease.Despite having been invited onto that lease by the senior traditional owner—I have photographs of signs which say `This area cannot be trespassed without permission', in this case from the Northern Land Council—and despite signs acknowledging that the wetlands, which can only be accessed by the road to the Djar-djar lease, cannot be accessed without permission from Aboriginal people, I got harassed by the police and ERA, as did the other people with me. The police, on instruction from ERA, harassed me for being there with the senior traditional owner.We have seen over time that there have been changes to Northern Territory laws to stop protests. We have seen members of this government wishing to close their ears to the concerns being felt in other parts of the world about this process. We have seen decisions being made in the European parliament. We have seen motions being carried in other legislatures. Lobbyists in Japan have asked me to go with them to talk to members of the Japanese Diet about these and other issues. We were talking about climate change and also about issues in relation to the Jabiluka mine. We know that there is some knowledge of the issues within the Japanese Diet.Australia's reputation is looking pretty tawdry at the moment. We have a situation where within Australia there is a recognition that the processes have not been carried out correctly. We know from the senior traditional owners that they have been treated shabbily in relation to this process. We know also—and this to me is one of the shabbiest examples in recent times—that the Minister for the Environment and Heritage has been putting out press releases where he says, `Oh and by the way, the senior traditional owner was with a group a couple of years ago which lobbied for the mine to go ahead,' despite the fact that this is an untrue statement. The group did nothing of the kind.There was a group which came to Canberra. The senior traditional owner, Yvonne Margarula, was a member of that group. Yvonne Margarula never has lobbied, and probably never will lobby, for the mine to go ahead. The group were desperate for the basic level of services—schooling and health—which all Australians should be entitled to. One member of the group was so desperate that he made some statements off his own bat, apart from the group, thinking that the only way he could get the basic services that everyone, including people in the Northern Territory, is entitled to was if the mine were to go ahead. That is a sign of the desperation and the pressure that has been put on some people in the Northern Territory.From indications that I have seen at committee hearings, where Aboriginal communities and Aboriginal culture have made the greatest contribution to the culture, the society and the economy of the Northern Territory, those groups are singled out by the Northern Territory government to get the least assistance with basic services. I do not think there is any surprise about this or any accident as to why this is happening. The reason it is happening, whether or not it is in Uluru or Jabiluka, is to continue to apply pressure so that those groups may be as powerless as possible and will continue to be as compliant as the government can make them. I do not think there is much doubt that those groups and cultures which have made the most contribution to the Northern Territory economy and will continue to do so are being neglected the most. You only have to look at the standard of their housing and at the desire for those people to be taught in their language.Lately we are hearing—I am shocked to hear former Senator Bob Collins pushing this line—that somehow or other the Northern Territory government is doing someone a favour by not allowing traditional people the choice of being taught in their language. Here we have a situation where I believe immoral pressure is being put on the people. Yet, with all of the immoral pressure, with all of the deliberate withholding—as I believe—of the services for which Commonwealth taxpayers' money has been put in year after year and is not being provided, with all of that the senior traditional owner has very clearly stated the Mirrar people's opinion. We have had that opinion misrepresented many times in this chamber.How many times have we heard from the Minister for the Environment and Heritage that there is a range of opinions? The reality is that a senior traditional owner has made her position unequivocal in relation to the uranium mine at Jabiluka. You would think that the environment minister would realise that he has an obligation to represent those views, but no.There are many unsolved problems. We have heard from Senator Bolkus about the ludicrous concept of a flora survey by helicopter. We have not heard what the government intend to do about the indications given in a consultant's report about possible acid mine drainage—the kind of problem that has led to the enormous environmental and health problems that continue to be the horror of Rum Jungle. What have we heard about the hydraulics? What have we heard about what will be in place to prevent the environmental disasters which are looming? Nothing. We have not seen the proposals on the ground. There are huge engineering problems that have not been solved, yet the government are tripping over themselves to give approval—despite rulings in relation to the heritage values at an international level, despite concerns expressed in other legislatures and despite the fact that the majority of Australians do not believe this government should go ahead with this decision.Something is wrong here, and I believe that it is the right—in fact, the obligation—of the parliament to look into the approval process and to make sure that the many things that are wrong are put onto the record. Layer upon layer of errors have been made in this approval process. Many facts which have been presented have been ignored. The government are tripping over themselves to do what ERA and a number of their other mining industry and industry backers are asking them to do—to present a hairy-chested front to the world and say, `Look how strong we are. You know that this is so important to the environment movement. You know that this is considered to be important by many people in Australia. We're so tough that we can afford to ignore this concern.' I believe that is the crux of the situation.The government made promises—in fact, if we recall, Senator Parer made promises—to the mining industry very early in their taking government in 1996. They made promises that they would reduce the costs of environmental compliance, that they would be industry friendly, and that they would not let what they considered to be minority lobby groups have their say on the environment agenda. By way of translation that means that the real concerns shared by the majority of Australians are considered by this government to be minority concerns that they can afford to ignore.Forget about any concept of a mandate here. What would happen if we put this issue to the majority of Australians? I can tell you that the majority of Australians would say, `This is not what we want.' Unfortunately, these issues were not brought up by the government in their election run-up. They were trying to keep as quiet as possible on these kinds of issues because they knew what the average elector would say. They were indicating that the only thing electors were going to the polls about was the issue of tax.The reality is that there needs to be a proper approval process for the Jabiluka mine. We need to make sure that this government has done the things it is required to do by law. We need to know that this government has made decisions based on the information that has been given to it and is not acting simply because a particular mining company has asked it to act in a particular way. If that is the case—despite all of the evidence to the contrary—you would have to say that this government has to be called to account. Supporting this motion is one way of calling the government to account in this process.16:34:004329Eggleston, Sen AlanSenator EGGLESTON4L6WALP10—This motion implicitly criticises the approval process for the Jabiluka uranium mine project. Such criticism is totally unfounded and absolute nonsense because the process has been thorough, open and transparent. Approval was obtained from the traditional owners and the Northern Land Council because of the great economic benefit to Aboriginal people. The world heritage report on Jabiluka was seriously flawed. It has so many defects that it is not worthy of consideration. This motion therefore has very little substance worth supporting—in fact, it has none and it should be opposed.The Jabiluka mine is to be developed on a mining lease which has never been part of the Kakadu National Park, and to imply that in some way the Kakadu National Park would be affected by this mine is a simple misrepresentation. The traditional owners gave consent to uranium mining at Jabiluka in 1982 under the Land Rights (Northern Territory) Act 1976, and they consented to the transfer of mining to ERA in 1991.The proposed Jabiluka mine has been subject to a rigorous environmental impact assessment process lasting nearly three years. An environmental impact statement and a public environmental report have been prepared under Commonwealth legislation. At least four separate public consultation periods, totalling nearly six months, occurred in relation to the assessment documentation and guidelines, so to claim that there has not been a thorough assessment process or an open and transparent assessment process does not stand up to examination. The result of the assessment process demonstrated that the proposed mine will not have an impact on the Kakadu National Park provided strict conditions are complied with. The government has imposed strict conditions on the proposed mine, and the Supervising Scientist will play a key role in monitoring compliance with the conditions imposed by the Commonwealth government.Under the preferred option for the Jabiluka development, which is known as the Ranger mill option, an underground mine is to be established in Jabiluka, with the ore being transported to the existing Ranger facility for milling and processing. Under this option there will be no tailings dump at Jabiluka and a policy of not releasing any contaminated water will be strongly enforced by the Commonwealth government. The mine site will cover a very small area—it is less than 10 per cent of the area covered by the existing Ranger mine, less than one per cent of the Jabiluka mineral lease and approximately 0.005 per cent of the Kakadu National Park.ERA has also had approval to proceed with an alternative option involving milling the ore at Jabiluka, which is called the Jabiluka mill alternative. Under this option all tailings must be returned deep underground to the mine void where the uranium ore currently rests, and the government has declined to approve the storage of 50 per cent of the tailings in purpose-built pits, indicating that further assessment would be required before any decision could be made for this approach.In the contributions this afternoon much was said about the traditional owners not supporting this proposal. As I have said, the traditional owners did support the proposal in the early 1990s and the Northern Land Council believes, currently, that the consents given by the traditional owners should be honoured. We have to ask ourselves why. The reason the Northern Land Council believes this mine should go ahead is that it will bring great economic benefits to the Aboriginal communities in the area. ERA predicts that Aboriginal communities will receive approximately $210 million in royalties from the Jabiluka mine. That means there will be better housing, hospitals, roads and educational services for the Aboriginal people in the area.In addition, there will be employment and training opportunities, with some 350 Aboriginal people being offered employment in the mine itself and about 1,500 indirect jobs. It is also estimated that, in the broader sense for Australia, the project will deliver export revenue of $12 billion over the period of the mine and that 87 per cent or thereabouts of that revenue will remain in Australia. So there are great economic benefits which will flow to the Aboriginal communities from this mine, and it will also bring huge economic benefits to Australia.I would like quickly to look at the World Heritage Committee's report. Australia has responded to that report now; it did so on 14 April. The Australian response demonstrates that the UNESCO mission report contains serious errors of fact, science and law and that it fails to give proper consideration to all of the evidence presented to it. It is a very biased and flawed report, and it should not be taken seriously. The Kakadu National Park world heritage area is being well protected under this government and this protection will continue. It is certainly not endangered by the proposal to mine uranium at Jabiluka. The Jabiluka mine site is outside of Kakadu National Park.FX5MURPHYSenator Murphy—Where is it, Alan?4L6Eggleston, Sen AlanSenator EGGLESTON—I have been there; I do not know whether you have. I suspect that you have not, being a Tasmanian and from the other end of the country.FX5MURPHYSenator Murphy—I have been there more times than you have.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Ferguson)—Order! Senator Murphy! 4L6Eggleston, Sen AlanSenator EGGLESTON—The Northern Territory is an area that I go to quite often. We have had criticism from Senator Bolkus about the government's position, but I will just remind the Senate that former ALP environment minister Graham Richardson said that uranium mining in the region:. . . had not caused one skerrick of damage to Kakadu . . . Mr Richardson went on further to say:Labor's pre-election posturing on Jabiluka was a stupid policy which is wrong in every respect.All Australia has asked of the United Nations is that we be given a fair and objective hearing over the UNESCO mission's report and on the world heritage values of Kakadu. Australia's response is open and transparent and establishes that there is no case for listing the park as a `world heritage area in danger'. So, overall, this motion calling for an investigation by the references committee into the processes of the approval really does not have any legs, it does not stand up to examination and I urge my senatorial colleagues to vote against it.16:42:004330Brown, Sen BobSenator BROWNQD4TASAG00—It is very sad when you hear a contribution to the Senate on an important matter like this which misrepresents the people who have most to lose from it. That is the case as far as the Mirrar people are concerned. They are the traditional owners of the Jabiluka Valley. They are to a person opposed to the uranium mine which is currently proceeding to be built in the heart of that previously pristine, beautiful and life-giving valley.The Senate knows that just last week Yvonne Margarula, the leader of the Mirrar people, and spokesperson Jacqui Katona were celebrated on the world stage where, before 2,000 people in the San Francisco Opera House, they received tumultuous applause for their work in trying to defend the Jabiluka environment and the time-honoured connection of the Mirrar people with that land against this awesome onslaught not just from the machinery power from ERA and the territory and federal governments and an uncaring, short-sighted and delinquent Minister for the Environment and Heritage but also from a Prime Minister who has turned his back on these traditional owners, even as he calls for a new period of reconciliation with the indigenous people of Australia.It is a sad time for this country as far as the environment is concerned. But I can tell you that the world at the end of the 20th century is really taking note of the indifference and, at times, the affront to the indigenous people not by the British Colonial Office, not even by early post-colonial governments, but by this government. This government seems as uncaring and as arrogant towards the indigenous people of this country when it comes to specific cases like this as governments in Malaysia or other countries where we do not see democracy, let alone a caring and concern, as a matter of high principle, for the indigenous people.It was a remarkable reception for these two people, yet again on a world stage, consequent on the UNESCO World Heritage Committee telling Australia in the most damning terms that it was doing the wrong thing and that if this continued there was an horrendous possibility that Kakadu would be listed as a world heritage endangered site—the first time this has happened in the developed world and the first time this has happened against the wishes of a government which ought to know better. It is a disgrace for the Australian government and a black mark against what has previously been a matter of high principle for Australian governments in not only defending the world heritage convention as an international treaty but enhancing its powers through fighting provincial governments like the Gray government in Tasmania, which wanted to destroy the Franklin River wilderness, and the Bjelke-Petersen government in Queensland, which wanted to continue to send the chainsaws into the Daintree rainforest. The federal government stood up against such maverick and destructive behaviour towards world quality heritage and were prepared to go to the High Court to fight to ensure that the reciprocal obligation of the world heritage convention was kept up. Australia was at the forefront in enhancing this convention which looks after the world heritage of the peoples of the world, not least the indigenous peoples of the world.I suppose that future generations which will want some of this natural world intact in their time will look back and damn the destroyers who cared so little about not only places of monumental beauty and wild significance like Kakadu but the relationship over thousands of years of human beings with the land. This is still a living relationship in this part of the world which enriches all of us, the majority of whom have long since been cut off, many generations ago, from the relationship which our forebears in the wilderness held for this awesome and infinitely beautiful life-giving little planet of ours.What we have here is a government saying, `Let us not have a committee look at this matter. Let us not make sure there is not a mistake here. Let us turn a deaf ear to the controversy that is out there in the electorate. Let us not have parliament reflect on the matter by having a committee listen to submissions from the electorate. Let us not give the indigenous people another opportunity—in fact, a prime opportunity—to appear before senators to express their feelings. Let us not look at the matter of spirituality, which has been missing from all government submissions in this debate but which is primary in understanding why the indigenous people are so aghast at what is happening on their land.'Let me say this to the absent Minister for the Environment and Heritage, Senator Robert Hill: your scientists do not understand that spiritual relationship. They cannot measure it. There is not an experiment which will discover the untold and infinite richness of that relationship. The minister does not understand it even though he stood in this place in October two years ago and said, `We must take into account the wishes of the Mirrar people, the traditional owners.' He has not spoken with them. All they have received is relentless pressure from a multibillion dollar corporation, North which, through its subsidiary, ERA, wants to convert this place of monumental spiritual significance to the indigenous people into some billions of dollars in profit so that they can buy bigger houses, fly more planes, have better cars and presumably have gold knobs on the taps in their bathrooms. That is what this is about. It is about riding over the spiritual sensitivity of these people so that some other indifferent people, most of whom have never been to this place, can line their pockets. It is a pretty disgusting process.Senator Murphy interjecting—QD4Brown, Sen BobSenator BROWN—Seeing that my fellow senator from Tasmania interrupts, let me remind him that North is the same corporation which is destroying world heritage value forests in Tasmania. The Labor and Liberal parties have given them carte blanche to move in over the next 20 years and knock down the grandest forests in the Southern Hemisphere—certainly the most statuesque hardwood forests in the world. That is at the other side of the country. This is matter of a ruthless uranium corporation, owned by an environmentally delinquent, indifferent and bigger corporation, which wants to extract dollars over a period of 10 to 20 years out of the heartland of the Mirrar people—and we have a senator from the coalition saying, `And they are going to give $210 million in royalties to the traditional owners.' That in itself is such a failure of understanding. You are going to give money to these people against their wishes and take away from them something beyond money which they want to keep—their relationship with the land.The extraordinary indifference of this government, which rides across the rights of these people and which is now trying to prevent them having a say to senators who want to hear the facts, has shepherded a process which has seen these people before the courts in the Northern Territory and one of them gaoled for two weeks. A mother—an Aboriginal spokesperson and now a global environmental prize winner—was gaoled for walking on the Mirrar people's own land because of this uranium corporation and its backing by this coalition government. Let me not get to the business of how many tens of thousands or hundreds of thousands of dollars from that corporation have gone into the electoral coffers of this government in recent years.The whole matter is pretty disgusting when you look at it from the Mirrar people's point of view; it is dishonourable when you look at it from our national point of view. We are still in the national spotlight over this matter. The World Heritage Committee is meeting on 12 July—I believe in Paris—to make a final determination. Rather than talk about the spiritual values and how this government is prepared to look into those and determine just how much they do mean to the Mirrar people, the Minister for the Environment and Heritage has allocated $1 million to send 30 or 40 diplomats—so-called diplomats; I would call them hucksters for an environmental corporation—around the world to try to do in the sensitivities of other people around the world who may make that determination and to try to obfuscate the issue which is at heart here, which is the indigenous people.If this process were fair, the same amount of money would go to the Mirrar people so that they could go to embassies, governments, ministers and heads of states elsewhere around the world and put their case, and there might be a balance brought in here. But there is nothing of the sort. On behalf of ERA and the parent company, North, with its reprehensible behaviour towards the environment and indigenous people, this government is spending $1 million of taxpayers' money to put their case to try to have this uranium mine validated, inherently by a decision by the World Heritage Committee that it will not list the area as threatened. Threatened the area is, threatened this nation's reputation is and threatened the time honoured spiritual relationship of the Mirrar people with their land is.Is this government not only so irresponsible as to allow those threats to proceed but also so short on confidence in itself that it will not have this committee look into such matters and allow the Senate to have some more hearings into whether proper procedures have been followed by the government? Patently, they have not. Patently, the behaviour of this government is improper, and that is sheeted home by the government's attempt here to try to prevent a committee from a very legitimate hearing—even as the jackhammers and the explosives are digging into the heart of a spiritual place of the Mirrar people in the Jabiluka Valley. Question put: That the motion (Senator Allison's ) be agreed to.17:01:00The Senate divided. (The President—Senator the Hon. Margaret Reid)34Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Carr, K.Collins, J. M. A. Colston, M. A.Conroy, S. Cook, P. F. S.Cooney, B. Crossin, P. M.Crowley, R. A. Evans, C. V.Forshaw, M. G. Gibbs, B.Harradine, B. Hogg, J.Lees, M. H. Mackay, S.Margetts, D. McKiernan, J. P.Murphy, S. M. Murray, A.O'Brien, K. W. K. *Quirke, J. A.Ray, R. F. Reynolds, M.Sherry, N. Stott Despoja, N.West, S. M. Woodley, J.31Abetz, E. Boswell, R. L. D.Brownhill, D. G. C. Calvert, P. H.Chapman, H. G. P. Coonan, H.Eggleston, A. 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.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.Watson, J. O. W.Denman, K. J. Ellison, C.Faulkner, J. P. Vanstone, A. E.Hutchins, S. Crane, W.Lundy, K. Alston, R. K. R.Schacht, C. C. Campbell, I. G.* denotes tellerIn division—QD4BROWNSenator Brown—Madam President, I draw senators' attention to the standing orders which say that any interest should be declared on a vote such as this.ZF4CROWLEYSenator Crowley—I suspect I may have an interest.CX5MACDONALDSenator Sandy Macdonald—I understand the motion concerns the woodchip industry and the company Norths. I have some shares in that company.Question so resolved in the affirmative.Bills4333s182Billss197433317:06:004333Eggleston, Sen AlanSenator EGGLESTON4L6WALP10—I present the report of the Environment, Communications, Information Technology and the Arts Legislation Committee on the provisions of the Environment Protection and Biodiversity Conservation Bill 1998 [1999] and the Environmental Reform (Consequential Provisions) Bill 1998 [1999] , together with submissions, Hansard record of proceedings, documents and ceremonial artefacts received by the committee.Ordered that the report be printed.4L6Eggleston, Sen AlanSenator EGGLESTON—I seek leave to move a motion in relation to the report.Leave granted.4L6Eggleston, Sen AlanSenator EGGLESTON—I move:That the Senate take note of the report.I indicate to the Senate that the report has only just been sent to the printer and is not expected to be available in printed form before the end of the week. Electronic copies of the report will, however, be available this evening by the Internet on the committee's home page. I seek leave to incorporate the remainder of my tabling speech in Hansard .Leave granted.The speech read as follows—On 2 July 1998 the Government introduced the EnvironmentProtection and Biodiversity Conservation Bill 1998 into the Senate.The purpose of the Bill was to overhaul and update the existing Commonwealth environmental legislative framework. As the Minister noted in his second reading speech of the 2nd of July 1998, (and I quote) "The bill represents the only comprehensive attempt in the history of our Federation to define the environmental responsibilities of the Commonwealth. Its proposes the most fundamental reform of the Commonwealth environmental law since the first environment statutes were enacted by this parliament in the early 1970's. Reform is necessary because the existing suite of Commonwealth law does not ensure high environmental standards in the areas of Commonwealth responsibility. Just as importantly, the existing legislation does not provide an efficient and timely assessment and approval process." (Senate Hansard 02/07/98 page 4795)The Bill also provides for a process of developing National Environmental SignificanceAs the Minister stated "A major deficiency in the existing regime is that Commonwealth involvement in environmental matters is determined by ad hoc and indirect triggers such as foreign investment approval and Commonwealth funding decisions. Reliance on such triggers has undoubtedly limited the effectiveness of the Commonwealth's contribution to environmental protection. It has also created significant and unnecessary delay, uncertainty and duplication for industry. More fundamentally, the use of indirect triggers means the Commonwealth becomes involved in the assessment of projects which raise environmental issues of only local or state significance. This should not occur. Conversely, under the existing law, the Commonwealth is sometimes locked out of contributing to an issue of genuine national significance because of the absence of an indirect trigger. In accordance with the COAG Agreement, the bill therefore abandons the reliance on ad hoc and indirect triggers in favour of appropriate environmental criteria.The bill introduces a new and more efficient assessment and approval process that applies to actions which are likely to have a significant impact on:. the Commonwealth marine area;. world heritage properties; . Ramsar wetlands of international importance;. nationally threatened species and ecological communities; and. internationally protected migratory species.The bill also applies to environmentally significant nuclear actions, actions on Commonwealth land and actions by the Commonwealth and Commonwealth agencies.An activity which does not have a significant impact on one of the matters of national significance will no longer trigger Commonwealth involvement in the assessment and approval process,even if it requires a Commonwealth decision or approval such as foreign investment approval.In accordance with the COAG Agreement, the bill provides a framework for recognising any additional matters of national environmental significance after consultation with the States and the proper consideration of State views." (Senate Hansard 02/07/98)The Bill provides for early, transparent and effective accreditation of State processes and systems.As I have mentioned, the Bill arose out of the Government's belief that existing Commonwealth environmental law was not capable of ensuring high environmental standards in the areas of Commonwealth responsibility, did not provide an efficient and timely assessment and approval process and relied on ad hoc and indirect triggers for Commonwealth involvement.On 8 July 1998 the Senate referred the Bill to the then Environment, Recreation, Communications and the Arts Legislation Committee for inquiry and report by 7 October 1998. The Committee advertised the inquiry in the major newspapers of each State and Territory on 15 July 1998, calling for submissions to be lodged by 21 August 1998. A hearing was held in Brisbane on 28 August 1998. On 30 August 1998 an election was called. Submissions continued to be accepted during the election period and into the new Parliament. The Committee received 632 submissions which are listed at Appendix 1 of the Report.Following the election held on 3 October 1998, the Bill was reintroduced into the Senate on 12 November 1998. It was re-referred to the Environment, Communications, Information Technology and the Arts Committee on the same day, for report on the first sitting day of the second sitting week in March 1999. The reporting date was subsequently extended to 27 April 1999.On 24 March 1999 the Environmental Reform (Consequential Provisions) Bill 1998 was referred to the Committee for report by 27 April 1999.The Committee held public hearings in every capital city. The Committee conducted hearings in Brisbane on the 28th of August 1998, in Sydney on the 4th of February 1999, in Hobart on the 19th of February, on the 26th of February in Perth, on the 4th of March in Canberra, in Adelaide on the 12th of March, in Darwin on the 17th of March and in Melbourne on the 18th of March.This committee report sees the completion of an extensive consultation process on environmental legislative reforms. The review of commonwealth-state roles and responsibilities for the environment preceded the reform of commonwealth environment legislation and culminated in the heads of agreement on commonwealth-state roles and responsibilities for the environment, endorsed in principle by COAG on 7 November 1997.The Review involved extensive consultation between the Commonwealth, States, Territories, and the Australian Local Government Association. It also involved consultation with relevant Ministerial Councils.Consultation with key non-government organisations was an important aspect of the Review process. In mid-December 1996 the Working Group conducting the review sought the views of over fifty key non-government organisations on a consultation paper. The Working Group requested that submissions be lodged by 21 February 1997. A number of organisations were granted additional time to prepare and lodge their submissions.Approximately forty submissions were received from conservation, industry, heritage, planning, legal and indigenous organisations. Both the major conservation and industry organisations formed consortia and lodged consolidated responses.The Working Group considered submissions from these organisations and met with key representatives of major organisations to discuss their views.The Development of the EPBC bill commenced with the Minister for the Environment February 1998 the Minister for the Environment issued a consultation paper, Reform of Commonwealth Environment Legislation , to provide information about the Government's proposals for the environmental legislation reform package and seek views on the proposed reforms.Approximately 5 000 copies of the paper were distributed to interested government and non-government organisations. The consultation paper was also made available electronically on the Internet.Comments on the paper were sought over a four-week comment period. Many late submissions were accepted. Over 350 submissions on the paper were received and considered in the development of the Bill. Both the Minister and officials held discussion with key interests. There have been no privileged negotiations with industry, or any other group.The Minister has asked the Department to organise further discussions between officials and representatives of both industry and conservation NGOs.Senator Hill requested that the Senate refer the EPBC Bill to a Senate Committee in July 1998.The Committee believes the bill should proceed with consideration to be given to the following amendments.RecommendationsChapter 3 + Overview of the Bill Process1. The Committee recommends that summary clauses be inserted for all chapters and parts of the Bill and a consolidated outline be included in Part 1 of the Bill.2. The Committee recommends that the parts of the Bill be renumbered so that their parent chapter can be identified. For example, Parts 2 and 3 should be renumbered as either Parts 2A and 2B or Parts 2.01 and 2.02.Chapter 6 + Protecting the Environment3. The Committee recommends that clause 25(3) be amended to strengthen the obligation to consult with the States and Territories before regulations are made to prescribe an additional matter of national environmental significance.4. The Committee recommends that clause 523(2) be amended to clarify that an enlargement, expansion or intensification of a use of land, sea or seabed which had been authorised by law immediately before the commencement of the Act is not an `action'.5. The Committee recommends that clause 14(1)(b)(ii) be amended so that the Minister must be satisfied that some or all of the World Heritage values of the property are under significant threat before declaring a property to be a declared World Heritage property. The Committee recommends that clause 17(3)(b) relating to declared Ramsar wetlands should be similarly amended.6. The Committee recommends that the Minister and/or the Department of the Environment and Heritage confirm the boundaries of Ramsar wetlands prior to the commencement of the Act.7. The Committee recommends that consideration be given to including a definition of `mining and milling of uranium ore' or of `uranium ore' to ensure that the mining and milling of non-uranium ores are not misinterpreted as a nuclear action.8. The Committee recommends that the authorisation under the Great Barrier Reef Marine Park Act 1975 of an action which has, will have, or is likely to have, a significant impact on the environment should be prescribed as an action under clause 160(2)(d) of the Bill.Chapter 7—Bilateral Agreements and Other Accreditation Mechanisms9. The Committee recommends that the Bill be amended to apply prerequisites, which are equivalent to those set out in clauses 50 to 56 for bilateral agreements, to the making of declarations.Chapter 8—Environmental Assessments and Approvals 10 The Committee recommends that the Minister consider whether clause 131 is sufficient to ensure that all relevant Ministers are consulted or whether an amendment is needed to achieve this.11. The Committee recommends that consideration be given to providing for approval conditions which are expressed, where appropriate, in terms of objectives and outcomes, and criteria for assessing the achievement of those objectives and outcomes.12. The Committee recommends that clause 145(2) of the Bill be amended to require that where an unforeseen environmental impact arises from an approved action, the Minister may not revoke the approval unless satisfied that conditions attached to the approval cannot be revoked, varied or added in such a way as to mitigate that impact. The Committee further recommends that the Minister be required to consult with the proponent regarding any revocation, variation or addition of conditions.13. The Committee recommends that the Bill provide for a simple and secure system for the transfer of an approval where a project changes ownership or management.14. The Committee recommends that the Bill specify appropriate timelines for the development of guidelines for the content of public environment reports and environmental impact statements.Chapter 9—Conservation of Biodiversity, Part 115. The Committee recommends that the Bill include a definition of a bioregion.16. The Committee recommends that the Bill be amended to provide for public consultation during the creation of bioregional plans over both Commonwealth and State areas.17. The Committee recommends that the Bill be amended to enable the re-nomination of a key threatening process initially rejected for the reason of it not being practicable and feasible to prepare and implement a nationally coordi nated threat abatement plan, when new information makes it practicable and feasible to develop a plan for abating the key threatening process.18. The Committee recommends that clause 191(2) of the Bill be amended to provide that the Minister must forward a nomination of a threatened species, threatened ecological community, or key threatening process to the Scientific Committee within a reasonable period of time from receipt of the nomination.19. The Committee recommends that the Minister gives consideration to amending the Bill to provide for the protection of all species on Commonwealth land unless the protection has been deliberately exempted by a Schedule attached to the Bill.20. The Committee recommends that the Bill be amended to provide that the Minister can order further reasonable action to be taken in the case of notification of a humane action that has occurred, such as returning the animal to the wild or seeking professional care for it.21. The Committee recommends that the Bill be amended to provide for public notification of permits relating to cetaceans and to provide the opportunity for public scrutiny by way of comments, similar to the current section 18 under the Whale Protection Act 1980 .22. The Committee recommends that the Minister consider including in regulations made under clause 301, a mechanism to provide for appropriate consultation with the traditional owners where a person seeks access to biological resources in a Commonwealth area, involving indigenous land or knowledge.Chapter 10—Conservation of Biodiversity, Part 223. The Committee recommends that the Minister continue to consult with relevant indigenous groups in relation to the implementation of the provisions of the Bill dealing with jointly managed National Parks.Chapter 11—Administration24. The Committee recommends that existing provisions in the Endangered Species Protection Act 1992 relating to merits review for permits be reintroduced into the Bill.25. The Committee recommends that in relation to environment protection consideration be given to amending the Bill to provide for the prosecuting authority to have a choice between civil and criminal proceedings in consideration of the seriousness of the offence.26. The Committee recommends that the Bill be amended to make provision for the inclusion of an indigenous representative on the Biological Diversity Advisory Committee in recogni tion of the significant contribution made by indigenous people to the conservation and sustainable use of biodiversity.I inform the Senate that the report is presented in A4 format and copies will be available on the 30th of April. However, electronic copies of the report are available on the internet at:http://www.aph.gov.au/senate/committee/erca_ ctte/17:08:004337Bolkus, Sen NickSenator BOLKUSXE4SAALP00—I also wish to speak to the tabling of this report of the Environment, Communications, Information Technology and the Arts Legislation Committee on the provisions of the Environment Protection and Biodiversity Conservation Bill 1998 [1999] . I begin by thanking the committee secretariat and staff for the enormously competent and comprehensive way that they tackled their task over the Christmas break and in January, February and March this year.This is a very extensive piece of legislation. It is one that still requires a lot of scrutiny. It is legislation which in essence tries to cover the field in Commonwealth environmental laws and tries to replace more than a handful of currently applying pieces of Commonwealth legislation. So it was not an easy task for the Senate committee and for the staff of the Senate committee. I thank them on behalf of the opposition. This essentially was legislation that had both the devil in the framework and the devil in the detail. The work done by the committee staff has been enormously important for us in our deliberations.The other group in the community that I would like to thank is that group of people who made submissions. We had an enormous number of submissions in respect of this legislation. Detailed and quite comprehensive submissions came from industry and environment groups. The submissions raised concerns in a very comprehensive and competent manner. We are left with the government's legislation, which is the subject of this report. It is legislation which has received a fair degree of scrutiny.Having said that, however, it also has to be placed on the record that towards the end of the committee's deliberations we were confronted with a consequential bill, the Environmental Reform (Consequential Provisions) Bill 1998 [1999] . It is a bill which itself has enormous ramifications. It is a bill that I would contend still has not received sufficient scrutiny by the Senate or the community. Consequential legislation is normally legislation which does not raise new matters and does not raise issues in an enormously comprehensive way. But what we have found and we are continuing to find with this legislation is that it does, for instance, impact on indigenous people's rights in a manner that one would never have expected had one taken the legislation and the preamble at face value.The opposition has decided that there are fundamental flaws in this legislation. There are flaws in terms of its basis, the COAG agreement of 1992, which was radically rewritten in 1997. There are flaws in that it essentially seeks to remove Commonwealth laws from the field of environmental law and its application. We are essentially finding under the cover of a very comprehensive piece of legislation and under the pretence of a COAG agreement that the guts of this legislation is to remove the Commonwealth government from the field of legislative interest. The objective and the pretence used by the government is that it is concerned that the Commonwealth has to rely in an ad hoc manner on indirect triggers for its interest in environmental issues. Such triggers include foreign investment approval and Commonwealth funding decisions and so on.The real experience over the last 25 to 30 years or so has been that the Commonwealth has had to intervene in matters of national or international concern because the states have not picked up the ball and met their obligations. It has had to do so by using whatever powers have been available to it. There have been landmark cases over that 25- to 30-year period which have basically designated for the Commonwealth a very important role in environmental matters.This government seeks, one way or another, to flick back this role to the states. I and the opposition are concerned that the mechanisms for involvement in environmental matters that have been available and increasingly available to national governments in the past will in the future, through bilaterals and conservation agreements, delegations or whatever—there are a whole range of avenues that the Commonwealth can use in the future—be delegated to the states. Once delegated, they will not be able to be reinvoked by the Commonwealth government in matters of concern. So we are concerned that this is the basic thrust of this legislation. We do see some merit in some of the initiatives encompassed in this legislation. However, in many ways this legislation may very well be about, in some respects, saving the endangered species but not saving the nests or the environment in which those species quite often find themselves.The government has proceeded with this legislation in a manner which, it also has to be put on the record, has upset a broad constituency of people. Much of the legislation and the impact of it is in the detail. The committee has not been able to look at the important detail which is embodied in the bilateral agreements and regulations. We had a lot of submissions from industry groups, for instance, who were of the view that the legislation was in need of a major overhaul. They said that it was archaic and unworkable and in need of a rewrite. Probably the main thing that industry groups put to the committee was that they would, in essence, like to see the bill not fully considered until details of the bilaterals and regulations were known. They understood the importance of the detail in such bilaterals and regulations. That was also the view of non-government organisations.We are concerned about that. We are concerned that a bilateral agreement which basically has the capacity and the effect of ensuring that only state processes and state approval processes are taken into account in respect of an environmental issue can be used to write the Commonwealth out of the agenda. We will look at those agreements. I think it is fair to say that the opposition will oppose the mechanism embodied in the bill for bilateral agreements.We also have a whole range of other concerns. We have concerns that are listed in our minority reports—concerns that the bill does not go far enough in terms of breadth of issues and in terms of what can be taken into account by the minister with respect to environmental impacts. The bill curtails avenues for public participation and curtails existing admin procedures. The bill impacts significantly on world heritage areas and not in a way that adds to their protection. The bill, for some reason, abolishes the position of the Director of National Parks and Wildlife Service and makes substantial changes to the protection and management of parks and reserves such as Kakadu, Uluru and Wreck Bay. The list goes on.We are gravely concerned about how this legislation also impacts on the Australian indigenous community, both with respect to those national parks I just mentioned and with respect to their continuing interest in matters of biodiversity. So we have some 17 or so areas of concern, concerns which in many ways emerged through the committee process and areas which we will take through to the next stage.In the minority report of Labor senators it is stated that we believe the bill is fundamentally flawed and that we are of a view that it should not progress further, pending resolution of a whole raft of issues. But I also have to say that I am not all that confident that those issues can be overcome, because the issues go very much to the heart of Commonwealth involvement in matters environmental. So having said that we have those 17 areas of important concern, I should also place on the record that, unless there is a radical rewrite of this legislation to ensure a continuing Commonwealth role, then the Labor Party will not be in a position to support it through a second reading.I go back to the point on which I started. The Commonwealth has developed an important role in environmental matters and in environmental protection over the last 25 or 30 years. This has been done consistently and primarily by Labor governments and it has been done against the opposition of state conservative governments on the whole and federal conservative oppositions. This is one thing we should keep in mind when we proceed to debate this legislation. This government—whether it is John Howard or Robert Hill—have always railed against Commonwealth involvement in matters such as protection of Tasmanian forests or the Daintree or Kakadu or Uluru and such areas. Those areas have been protected at the end of the day because of the use of that indirect power available to the Commonwealth. It is a power that the public have supported us using. It is a power that the public now appreciates Labor having used in government and it is a power that this Senate, in deliberating on this legislation, should think seriously about as to whether we want it delegated to the states. That goes to the heart of our concern and to the heart of the concern of a lot of people who came to the committee with their deliberations. Once again, I would like to thank the committee secretariat for their assistance.17:17:004339Allison, Sen LynSenator ALLISON1M6VICAD00—I too would like to thank the committee secretariat. They did a fantastic job under quite trying circumstances, given that we were also dealing with tax and that this committee was concurrently dealing with the Commonwealth powers inquiry.The Environment Protection and Biodiversity Conservation Bill 1998 [1999] is very extensive and very complex. It is fair to say that almost all submissions were highly critical of it—from industry, conservation groups and individuals. However, the Democrats believe that if the recommendations that we have laid down in our minority report are adopted we will have a better piece of legislation than the current legislation. We do agree that a review of that legislation was long overdue. Our laws are very convoluted, and too much action has relied on political will instead of on clearly stated processes.I want to talk a bit about the consultation. There was very limited time for consultation, initially with regard to the discussion paper and then limited time for the committee to report. The COAG agreement, which was the source of this legislation, did not involve the public and was quite secretive, so we do not accept that COAG is a reasonable basis for legislation without more widespread consultation. It was disappointing to a lot of those who were witnesses that the evidence they put forward initially in terms of the response to the discussion paper and then finally to the committee was not picked up by the government. So that evidence was not reflected in the majority report.We were acting under some constraints by not having available to us the regulations or the bilateral agreements—not even any drafts of those. Many submitters said that this legislation should not be considered until that was available. The bilateral agreements will hand over assessment and approval processes to the states, and many people drew attention to the problems associated with that.We have three fundamental objections. Broadly speaking, these are inadequate definition and use of ESD principles, especially with respect to the importance of public involvement, the limited view as to the Commonwealth's responsibility—for example, the very vital matters of national environment significance and using the bilateral agreements to delegate Commonwealth decision making to the states—and also the very large scope for ministerial discretion and the range of exemptions from the bill.As I said, the bill does contain a number of improvements on the current legislation. In particular, we welcome the transfer of powers relating to environmental assessments and approvals from the action minister to the environment minister. We think this makes a lot of sense, and so did the witnesses and submitters. We also support the establishment of the Australian Whale Sanctuary, the protection of RAMSAR wetlands and the expansion of the current threatened species provisions beyond Commonwealth areas and actions, the removal of obstacles to controlling damaging activities on world heritage properties and the recognition of vulnerable ecological communities and conservation of dependent species. These are very strong and useful measures to have in the legislation.We were quite disturbed to discover in Adelaide the extent to which this bill was problematic for indigenous people. The joint managers of Uluru, Kakadu and Booderee expressed their disappointment at not being consulted over the changes which would remove the Director of the National Parks and Wildlife Service and introduce a member of the Northern Territory government onto their boards of management. I hope that matter can be resolved, because it is regarded as a serious issue by the management boards. Another matter which was raised by many submitters was the need for a commissioner for the environment. The Democrats strongly support that idea.I do not think the flaws in the bill are so serious that they cannot be fixed, but it will obviously take a great deal of cooperation on the part of the government to fix the bill. The Democrats are pleased to give the government the opportunity to do just that. We will move into the committee stage with a number of amendments. I hope the government will see its way clear to support them. As I said, we will give the government the opportunity to do that before deciding whether or not to oppose this bill in the second reading.17:23:004340Margetts, Sen DeeSenator MARGETTSDX5WAG(WA)00—I also wish to speak to the report, which has just been tabled, of the Environment, Communications, Information Technology and the Arts Legislation Committee on the Environment Protection and Biodiversity Conservation Bill 1998 [1999] . At the outset, I note that our position is slightly different from that of the Democrats. Senator Allison has suggested that there are flaws in the bill, but she believes that the flaws could be fixed by a few amendments. As you listen to my presentation and my arguments today, you will realise that that is far from the case in the view of many people, including the Greens (WA).I wish to thank everybody who put in the time and effort to participate in the committee's inquiry. Many witnesses considered this bill so important that they felt they must appear and express their concerns. I participated when I could in person and, at other times, by teleconferencing. It was very useful for me to be able to do that, even if I was at the other end of the country.Let me make it clear that the Greens (WA) regard this bill as potentially a total disaster for environmental protection and biodiversity conservation in Australia. I wish that government senators who have the majority on the committee had taken more notice of the majority of the 600-odd submissions which stated that there were tremendous problems with the bill and with the processes by which it was developed.Unfortunately, the majority report of the committee has neglected the evidence and the concerns that were placed before the committee. The government senators who formed that majority have ignored compelling evidence and have recommended merely fiddling with a few parts of the bill. Overall, the main concern is that the underlying theme of the legislation is still to hand over the Commonwealth's environmental responsibilities.I will say a few words about the abysmal process by which the bill came about, as it will probably be extremely informative as to the real motives of the government concerning the legislation. The bill very definitely comes from the heads of agreement of the Council of Australian Governments of 1997—the so-called COAG agreement. COAG processes are based on secrecy and are without proper accountability. COAG discussions and agreements are dominated, at the federal level, by the Prime Minister's department and, at the state and territory level, by the offices of the Premiers and Chief Ministers. In other words, the controlling forces were pro-development bureaucracies that regard environment as an unfortunate impediment to development which must be kept in its place, hence the only interest group seriously considered in the development of this bill has been government, and the lowest common denominator has usually prevailed.Almost all witnesses who came before the committee—industry as well as environment groups—commented on the limited time they had had to consider rather inadequate consultation papers and the 430-page bill itself. Complaints about the process came from the full range of industry, environment and community groups. Traditional owners were not consulted in any meaningful way on proposed changes to their lease agreements in Uluru, Kakadu and Booderee—or Wreck Bay. For heaven's sake, they own the land! They were basically told what was going to be done as a kind of side issue. Basically, from what I heard, they were treated as though they were being annoying by not simply nodding their heads and agreeing with what the government was proposing.Let us look at the content of the bill. Overall, as we heard in the committee process, the bill is an attempt to wind back the clock and allow the Commonwealth to retreat from its responsibilities. This is the only explanation that can be given for limiting Commonwealth environmental assessment and approval to a mere six matters of national environmental significance in the bill. Remember that the government has continually said, `We are going to give better protection to areas of national and international significance.' Listen closely: there are only six matters in this bill.What happened to Commonwealth obligations with respect to some of the most significant environmental challenges facing Australia today—issues that even the government has suggested are significant—such as climate change, the clearing of native vegetation, the loss and degradation of native forests and the unsustainable use of water? These matters are undoubtedly of national environmental significance and should be subject to the Commonwealth's environmental assessment and approval processes. Administrative approaches alone are not sufficient; legislative backing is essential.Even with regard to the six issues, proposed Commonwealth involvement is narrowly defined in the bill and a broad range of exemptions may be applied. If, for example, an aluminium smelter operation is proposed which may have a significant impact on a threatened species, the Commonwealth will be restricted under the bill to assessing the impact on that species, hence the Commonwealth would not be able to assess the impact on climate change or other matters of national environmental significance.The bill also requires the Commonwealth to take into account all economic and social impacts. I would like to see what the government has actually set up to look at the social impacts because it does not have something properly in place now to look at that, and yet there is only an extremely narrow range of environmental impacts. What happened to ecologically sustainable development? The federal Minister for the Environment and Heritage comes into this chamber again and again and argues that the environmental decisions that he makes have to take full consideration of economic impacts, and yet here we have an environmental piece of legislation which puts economics first. What a surprise!As shown in this bill, ESD is a nice catchphrase for the government but is never actually implemented in any way that could cause hiccups to development. The way the bill neglects public consultation throughout is also illustrative of not being serious about ecologically sustainable development. The bill also has an incredibly large scope for ministerial discretion and other exemptions. You could drive a bus through the exemptions in this bill. In particular, the Commonwealth could give away virtually all of its environmental responsibilities by using a combination of bilateral agreements, ministerial declarations and specially accredited processes. Given the poor record of many states and territories, I and other members of the community are very worried about the very real prospect of the Commonwealth getting the states to take over much of the Commonwealth's responsibilities. The bill does not even have adequate safeguards that could enable improvements in the quality of state environmental programs and processes. The bill does contain a few positive elements, I agree. However, these are relatively small benefits when the overall bill and the process by which it was developed are considered.This bill amounts to a fundamental abrogation of the Commonwealth's environmental responsibilities. The Commonwealth should not be retreating from its national and international environmental obligations. High Court decisions have clearly shown that the extent of Commonwealth powers is considerable, and past experience has shown that this power needs to be exercised if the environment is to be protected. We are at a time in our history when environmental problems are causing increasing community concern and threatening the very basis of our life on this planet. At such a time, the Commonwealth should be developing and legislating for best practice environmental processes—not putting forward this pass the parcel legislation which ends up being lowest common denominator. For example, a commissioner for the environment should be established as an independent authority to review the performance of the Commonwealth in fulfilling its environmental objectives and priorities. Public involvement should be mandatory in all key stages of planning and approval processes with respect to environmental assessment and biodiversity conservation.We should not and cannot pass this bill. I note that the only senators supporting this bill as it currently stands are those from the government. In the dissenting report of the Greens (WA) and Senator Bob Brown of the Australian Greens, we have clearly stated that this bill should be withdrawn; that is, back to the drawing board. We do not think that a bit of fiddling around at the edges will do. What should happen is that a genuine community consultation process should be implemented to help draw up replacement legislation that reflects the Commonwealth's responsibility to protect Australia's environment.The very fact that this Commonwealth government, this coalition government, have thought that they could get away with putting together shoddy legislation in this manner and turning their back on most of their environmental responsibilities is an indication that they are prepared to use the non-mention of the environment in the Australian Constitution as an excuse for turning their back on their responsibilities and on the wishes of the vast majority of Australians. This certainly is not good enough. If in some strange way they were able to get this bill through, it would indicate that there definitely need to be changes to the Australian Constitution to make sure that this cannot continue to happen.17:33:004342Brown, Sen BobSenator BROWNQD4TASAG00—Senator Margetts has very clearly outlined the reasons that the Greens oppose this environmental legislation and believe that other parties should do so. It is not amenable to fixing up. It is an extraordinarily bad deal for the environment. Last night I was in the Hobart Town Hall, where a magnificent presentation of slides of Lake Pedder by former engineer Les Southwell was greeted with terrific applause. It caused me to cast my mind back to 1972, when the incoming Whitlam government, through legal investigation, found itself unable to override the state government of Tasmania—in those days the Hydro-electric Commission—which was moving to destroy a national park in which was one of the gems of natural beauty on the face of the earth, Lake Pedder. It proceeded to do that. Out of the 1974 consequent federal inquiry came the start of the environmental powers that the federal government has. Certainly most of these came from the Whitlam era. They include the signing of the World Heritage Convention, the establishment of the legislation we have now for environmental assessment of those matters in which the Commonwealth is involved, and so on.What this legislation is trying to do and will effectively do is turn back the clock to pre-1972. It is a throwback to mid-century. At a period when this economic rationalist government is all in favour of removing impediments to the big corporations, not least resource extractors, to do what they want on a world scale, this same government is saying, `When it comes to the environment, let's give the powers back to regional governments, even where they are dealing with economically significant environmental and indigenous heritage.' That is because those corporations want it. They want a free rein to do business around the world and, when it comes to environmental responsibilities, the easiest people for them to knock over are the smallest; that is, the smaller the government, the easier it is for them to get at it. It is very difficult to deal with a national government with the weight of public opinion behind it. That is why this legislation is effectively bankrupt. It is turning back the clock at a time when the Australian people want the federal government, the national government, to take more responsibility for the environment, not less. I seek leave to continue my remarks later.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Crowley)—The time for the consideration of that report being concluded, I now call the clerk.XE4BOLKUSSenator Bolkus—On a point of order, Madam Acting Deputy President: the running sheet shows that there are two reports to be presented today. The first is the Environment, Communications, Information Technology and the Arts Legislation Committee report on the provisions of the Environment Protection and Biodiversity Conservation Bill 1998 [1999] and the second is the report on the Environmental Reform (Consequential Provisions) Bill 1998 [1999]. I would note that the second report has not been tabled.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—Senator, they were tabled jointly, I am sorry.XE4BOLKUSSenator Bolkus—I am sorry, Madam Acting Deputy President, I missed that and I think other senators did as well. I raise it at this stage because there is a number of matters in respect of that consequential legislation which we have not discussed because of an understanding or an impression that we all had that we would only discuss the report on the bill.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—Senator, what is the matter you are raising?XE4BOLKUSSenator Bolkus—The matter I am raising is that I think it has been missed by everyone that the two reports were tabled at once. But the second point of order is that there was a fairly important aspect of the deliberations of the second committee which the committee undertook to bring before the Senate. I just seek leave to refer to that for a few minutes.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—Is leave granted? Are there objections?WW4KEMPSenator Kemp—Just on a point of clarification: he said a few minutes and I assume he will stick to that.XE4BOLKUSSenator Bolkus—I will, but we are used to your sticking to your commitments too, Senator.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—Is leave granted? There being no objection, it seems it is granted for about five minutes, Senator. 17:38:004343Bolkus, Sen NickSenator BOLKUSXE4SAALP00—Thank you, Madam Acting Deputy President. When we deliberated on the Environment Protection and Biodiversity Conservation Bill 1998 [1999] and the Environmental Reform (Consequential Provisions) Bill 1998 [1999] in Adelaide, we had a group of traditional owners from the Uluru-Kata Tjuta national park who came before the committee and made a presentation. Their concern was as to the bill, but it was also as to the consequential provisions bill because the consequential provisions bill changes the regime of management that currently operates especially in respect of Uluru, Kakadu and Wreck Bay but there may be others as well.When they came to us they presented to us a painting and some Aboriginal artefacts. The request from them was that when this matter was debated, when the committee reported to the parliament, they would have liked their gifts to the Australian parliament to be presented to the parliament. As I say, there was a painting and two artefacts. They came from traditional owners Malya Teamay, Johnny Tjingo and Tony Tjamiwa and they were of importance to them. They took some time to explain to us the symbolic importance of the painting, a painting which depicted the tjukurpa which belongs to the Uluru-Kata Tjuta area and the importance of that for the traditional owners.I think at the time of the discussion Senator Eggleston actually handled the presentation extremely well and gave an indication that the items would be presented to the Senate. I notice that in the area behind your chair, Madam Acting Deputy President—behind that barrier—those three items are now located. I think the undertaking we gave was that they would be presented into the Senate chamber, but I am sure that Senator Eggleston, when he gave that undertaking, did not anticipate that they would be hidden behind the President's chair. So I think it is important to raise the fact that they were presented to us, the fact that we gave an undertaking to have them presented to the parliament and also note that they are somewhere in the chamber.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—They were presented to the Senate, Senator, by Senator Eggleston.Debate adjourned.Bills4344r703Billsr667Billsr666Billsr702Billsr699Billsr698Billsr664Billsr660Billsr658Billsr657Billsr701Billsr663Billsr659Billsr700Billsr6614344A NEW TAX SYSTEM (GOODS AND SERVICES TAX) BILL 1998Consideration resumed.17:41:004344Sherry, Sen NickSenator SHERRYZW4TASALP00—Every time we get to the issue of the costing of the 128 amendments, we seem to get interrupted.Senator Kemp interjecting—ZW4Sherry, Sen NickSenator SHERRY—No, it is an issue I wanted to develop further, Senator Kemp, and I have had only a couple of minutes to do it. Just on the 128 amendments, I note your words this morning in response to the couple minutes of questions I raised on Friday just prior to the adjournment that the amendments restore the government's original intention so there is negligible financial impact, being fine-tuning. I could phrase it another way, and I will, that effectively what you are admitting to are 128 mistakes, not insubstantial mistakes. If we look through the list of 128 as closely as we can to date, there are a number of important issues that are raised in those amendments: matters relating to financial institutions, insurance, bad debts, reimbursement of employees, nursing homes, medical aids, farmland, long-term accommodation, sugarcane—I will come back to that one shortly—casinos and, I note, some watering down of the general GST anti-avoidance provisions and a range of other matters.I want to come back to the sugar provision, Senator Kemp. When we had the select committee hearing in Brisbane, we heard from the sugar industry. I do not want to go into the entirety of their submission in any sense, but there were two matters that the sugar industry raised. One related to the financing of the cost impact of a GST, and they argued that a GST would result in the Queensland Sugar Corporation paying a GST on all raw sugar production as payments were progressively made to mills in Queensland. With 85 per cent of production being for the export market, a significant financing cost would be incurred. That was one issue they raised—the cost of finance for the additional cash flow they would require. The second issue related to the effective excise component of the cost of diesel paid for railway transport of sugarcane, that that would increase from zero to 18c per litre and that the cost of the change to the Queensland raw sugar industry was estimated to be $2.3 million per annum.I am not going to go into whether or not their concerns are justified or into the arguments they put. But, by way of example, it is not clear to me immediately the exact operation of the amendments to clauses 123, 15 and 55 of the main GST bill—request numbers 62 to 65—but it appears to go to this issue of sugarcane railways and the problems that they laid before the Senate committee in respect of diesel. I signal that I am not going to go through all of the amendments, Senator Kemp; I am just dealing with this one issue.WW4KEMPSenator Kemp—I am very relieved to hear that.ZW4Sherry, Sen NickSenator SHERRY—Good. I am keen to keep moving on the issues relating to the GST. Can you confirm what the impact of that is and whether, in fact, it does relate to that issue that the sugar industry raised?17:46:004345Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I have sought some advice on the matters you have raised, and my advice is that it does, in fact, deal with the problem that you raised just then. The intent was that no-one would have a lower benefit than that under the diesel fuel rebate system, and the policy was costed on this basis. Therefore, there is no additional cost against the forward estimates.Let me just make a point. There is an issue here that I just wish to touch on. The amendments we have made reflect consultations that we have had with the wider community. You might term them `mistakes'; we regard them as finetuning and improving the bill. I think it would be exceedingly rare to have any legislation of the size—perhaps legislation of one-tenth of the magnitude—of that which we have brought in. As you know from your experience in government and I know from my experience in government, there are often amendments that are brought forward, as there should be. The amendments look at ways in which the bill can be finetuned and improved.17:47:004345Sherry, Sen NickSenator SHERRYZW4TASALP00—Thank you for that confirmation. My point is that the impact of this area of amendment in respect of the sugar industry would be addressing the concern they raised and complained about—the additional cost per annum of approximately $2.3 million in respect of diesel paid for rail transport of sugarcane. Could you confirm whether, in fact, the figure they gave to us was a reasonably accurate figure? They said $2.3 million. I assume you would have some idea about the confirmation of that.17:48:004345Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I cannot confirm that figure or not, but I think the substantive point is that this is what was always intended by the legislation. I think the amendment that we brought in clarifies that position. My expectation is that that amendment would be welcomed by the sugar industry.17:49:004345Sherry, Sen NickSenator SHERRYZW4TASALP00—I just want to confirm something. As I recall, you were saying that all of these amendments—all 128—relate to matters that were outlined in the ANTS package and clarify matters that were outlined in the ANTS package only.17:49:004345Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—My advice is that the majority are. Others deal with some issues of community concern which have been brought to our attention. The government has reflected on those matters and has been pleased to move amendments.17:50:004345Sherry, Sen NickSenator SHERRYZW4TASALP00—I am glad we have got that issue sorted out, because I certainly was under the impression from your initial comments about the 128 amendments that they were all restoring the government's original intention, but apparently some are not. I do not expect an answer to this now, and I do not want to go through them one by one, for obvious reasons—it would take an enormous amount of time. Many of these amendments are significant. I would certainly describe some of them as being merely technical in nature, but many of them are significant.3M6MURRAYSenator Murray—Do they have a mandate for them, Senator Sherry? Have they put them to the people?WW4KEMPSenator Kemp—I don't think you have run the mandate line on that, Senator Murray.HX5WOODLEYSenator Woodley—You haven't run it all day.WW4KEMPSenator Kemp—I think I have.10000Sherry, Sen NickThe TEMPORARY CHAIRMAN (Senator Crowley)—This is very interesting, but it is probably making life very difficult for Hansard . In a minute I will have to ask you to state your name before you interject. I hope you have got all of that, Hansard .ZW4Sherry, Sen NickSenator SHERRY—Thank you. That outburst of behaviour from the Democrats has shocked me. We had an example of that from Senator Murray on the Senate GST committee at one point, I recall, as well. You stunned us, particularly compared to the comprehensive behaviour of others on the committee.I have two questions, Senator Kemp, and I understand you will not be able to address them this afternoon. The first is: could you indicate into which categories the amendments fall, with category A being amendments that restore the government's original intention and category B being the category of amendments that the government on reflection has decided were unrelated to restoring the original intention but are `improvements', as I am sure you would argue, or `enhancements' or whatever particular terminology you want to use?My second question on those two categories of the 128 amendments is: what is the estimated cost saving or restoration of the government's original intended cost or what is the new cost of each of these items? I do not expect an answer now. I intend to leave the issue there and come back to the matters at a later time.The second matter I wanted to raise relates to a matter that I originally raised in question time last week in a question that went to Senator Alston, who was Acting Leader of the Government in the Senate in Senator Hill's absence. I do not intend to go over the chaos of last week and the mismanagement by Senator Alston. We are just pleased to see Senator Hill back here and things going along relatively smoothly, so far. But I raised a very serious issue in my question to Senator Alston which we did not get an answer to. Our leader, Senator Faulkner, raised the issue the following day, and again it was referred to in a question to you today.The issue relates to the Prime Minister, Mr Howard, misleading the people of Australia in respect of the so-called $15 billion to $20 billion growth tax. Apparently, on 3AW with Mr Neil Mitchell on 23 April Mr Howard claimed that by 2005-06 the states would be $3 billion better off because of the GST, that this would grow to $15 billion to $20 billion cumulatively by the year 2010 and that all state taxes in the intergovernmental agreement would have been abolished by then. I put it to you that this is untrue; it is incorrect.According to the data that has been prepared by state governments and which I understand is not disputed by the Commonwealth Treasury, the only way the states can be $3 billion better off by 2005-06 is by retaining one of the taxes that they are required to abolish—and I refer here to the non-residential conveyance duty. If that duty is abolished on schedule at the point where sufficient surplus is available to each state, then Mr Howard's claimed $3 billion figure shrinks to $1 billion, and on any sort of reasonable projection Mr Howard's $20 billion growth tax shrinks to about $8 billion. I would submit that the Prime Minister has misled people in respect of this matter.We still do not have a satisfactory explanation. We are not in question time now—at least in our question time for non-committee stages of legislation—and the Labor opposition would like an explanation. We do not believe we got any sort of explanation last week on this matter. For the record, we would like the figures and we believe Mr Howard—I will not get into the issue of whether it was intentional or not—has misled the Australian people in regard to this issue. When I look at the impact of the tax package state by state, I see a summary of each of the state figures and the final budget impact. I do not know whether Senator Harradine is listening—he is not in the cham ber at the moment, and that is not a criticism—but let me take the figures for my own state of Tasmania by way of an example. This is the final budget impact after the abolition of non-residential conveyance duty, if it is abolished: in 2000-01 there is a nil improvement in Tasmania's financial position; in 2001-02 a nil improvement in Tasmania's financial position; in 2002-03 a nil improvement; in 2003-04 a nil improvement in Tasmania's position; in 2004-05 an improvement of $11.2 million in Tasmania's position; and in 2005-06 an improvement of $13.8 million in Tasmania's position. There are no figures beyond 2006, although I suspect the precipice may be reached. I draw the committee's attention to those figures for the final budget impact of Tasmania because I do not believe that, given the difficult circumstances of Tasmania, that is a satisfactory position when we take into account the extravagant claims, misleading claims, made by the Prime Minister.One of the major themes, Senator Kemp, of your government's tax package is that everyone is better off, including the states. That is a fascinating argument. I do not know of any tax that can leave everyone better off without any conceivable disadvantage to anyone. I would submit that is a mathematical impossibility. Be that as it may, it is an important issue that should be addressed. There is still the hangover from the failure of you and your colleagues in the Senate to address this issue, and we intend to pursue it.I will condense my remarks to streamline the process. I drew attention to the financial impact on Tasmania. Before I make some specific comments about Tasmania, I want to put on record a conversation I had last week with a representative of the surf-lifesaving clubs in Tasmania. I am not sure whether he was officially representing the surf-lifesaving groups in Tasmania, but he is a member and he raised with me concerns about the impact of the GST and the abolition of the wholesale sales tax. I indicated to him that I would put these concerns on the record.The clubs are able to purchase their equipment tax free. They do not pay wholesale sales tax on boats, lifesaving equipment, radios, et cetera, and they are able to on-sell equipment they purchased wholesale sales tax free to purchase new equipment. However, under a GST they will not be advantaged in this way. The representative drew to my attention that, if the wholesale sales tax is replaced by a GST, there will be no advantage in being able to on-sell equipment and achieve, through the sale of that equipment, the necessary funds to purchase new equipment. This is an unintended consequence—or maybe an intended consequence—of the impact of the GST replacing the wholesale sales tax in the surf-lifesaving area. I put that on the record because I have been asked to raise that concern.A couple of matters have caused the government of Tasmania some deep concern. We need to draw a distinction between the carve-up of the GST moneys that will be returned to the states—and their satisfaction in getting a share of the moneys available—and the economic impact of the GST on my home state of Tasmania. Tasmania's economic performance has lagged significantly behind the rest of Australia for some years. It is a small and open regional economy heavily dependent on natural resources, agricultural activity and tourism. Tasmania's industrial base is becoming increasingly uncompetitive, and the population is declining. I live in the township of Forth—you will not be familiar with it, Senator Kemp, but it is on the north-west coast of Tasmania between Burnie and Devonport.HX5WOODLEYSenator Woodley—It is magnificent country.ZW4Sherry, Sen NickSenator SHERRY—Thank you. Looking at the latest ABS statistics, the township of Forth—and it is not because my wife and I have moved there—is one of only half a dozen communities that is growing in Tasmania, but that is an aside. Unfortunately, there is a problem of a declining population. With respect to general economic performance, there are a couple of other characteristics in respect of Tasmania. We have a different industrial base from Australia as a whole—agriculture, forestry and fishing. Manufacturing is significantly different in Tasmania from the rest of the nation. Public administration and community services have traditionally made a greater contribution in Tasmania. The finance sector is relatively small and growing smaller because of the relocation of staff to the mainland—to centres such as Melbourne and Sydney. Key growth industries are: food; beverages, including wine production—and I am not going to go into the wine tax at the moment; I am sure we will have a vigorous debate about that later—aquiculture; and personal and recreation entertainment services geared to tourism.Tasmania is in a poor financial position. I will not go into the reasons for this, Senator Kemp—you may touch on it and then I will have to respond—but that is a synopsis of the difficult problems Tasmania faces. The average income levels in Tasmania are lower than nationally, and there is a higher proportion of welfare beneficiaries—32.3 per cent compared with 29 per cent for Australia as a whole. I think Tasmania has the second-oldest population in Australia, behind South Australia. Obviously, a direct impact of all of this is that unemployment is higher and has been consistently higher. (Time expired)18:06:004348Quirke, Sen JohnSenator QUIRKEZS6SAALP00—I want to join in on the states debate and the impact of this legislation, A New Tax System (Goods and Services Tax) Bill 1998 and related bills. There are a number of points I will make as the night goes on, but an article in today's Adelaide Advertiser sums up in concise words a number of the issues associated with this. The article is by the hand of Cliff Walsh, a friend of mine, under the heading of `GST a gamble for the States'. Many of the points that have been made on this side are the sorts of things that Cliff addresses in his article. He states:The bottom line for Australia's prospective new federal fiscal arrangements is that the deal done between the Commonwealth and the States over the GST will result, in effect, in all the GST revenues being paid to the States to replace untied (general purpose) grants now made to them plus revenues that the States now collect from financial transactions taxes, such as FID, BAD and stamp duties on business transactions (ie these taxes will be scrapped).The deal also provides that the Commonwealth will have to obtain agreement of the States if the GST legislation is to be changed. On the face of it, this may sound like a good deal from a number of perspectives.For one thing, from a States' perspective, it replaces untied grants that now are essentially arbitrarily determined by the Commonwealth with a "guaranteed", growth revenue source, including an apparent guarantee that the States will have a say in any future changes.From the Commonwealth's perspective, it seemingly both removes a source of perennial irritation—the annual clamour by the States for a better deal on grants—and addresses a criticism levelled at its GST proposal—namely, that it would be free to raise the rate from the initial 10 per cent more or less at will.As always, there are important differences between appearances and reality.For example, the claim that the Commonwealth will have locked itself into a 10 per cent rate unless it can win the States' support to change the rate is something of a fiction.His words, not mine. He goes on:All the relevant legislation relating to the GST will be Commonwealth legislation, because, as the High Court now defines excise duties, the States have no capacity to enact GST-type legislation. If it has a supportive Upper House, the Commonwealth, under its own authority alone, can change the deal by changing its legislation, including, for example, to take things out of the base, and change the GST rate, and/or the share of GST revenues received by the States.To be sure, to do so the Commonwealth would have to face more than usual publicity and pain: but the fact is it hasn't really given up arbitrary powers over State revenues.Meanwhile, the States are giving up access to tax bases over which they now have autonomy to change rates and revenues, for access to revenues over which they cannot exert any independent authority.If the growth of GST revenues proves to be less than they expected, over time or in any given year the States have no capacity to change rates (they can't individually or collectively legislate on a GST). Moreover, in effect, they've given up some of their capacity to negotiate a better outcome with the Commonwealth. You can almost hear the Prime Minister saying: "You signed up to a deal; live with it." So the upshot is that the States have accepted reduced revenue-raising autonomy in exchange for access to revenues from a so-called growth tax over which they have no effective decision-making control. Their gamble, on behalf of future generations, is that GST revenue growth will exceed what grants they could have hoped to squeeze out of the Commonwealth through regular negotiations, plus what realistically could have been expected to be raised from the financial duties they're giving up.Of course, we'll never know whether their judgment was correct. But, more importantly, I think that political expediency on both sides (Commonwealth and States) has caused us a missed opportunity to develop a more healthy and dynamic federalism at the start of the second century of the Australian Federation.I want to return to that end point that Professor Walsh made. He made the comment that we have an opportunity to make sure there is a `dynamic federalism' in this country. I think that, in a way, Professor Walsh is probably wrong on that point. One of the criticisms I have of the GST arrangements as they are now is the fact that, if this legislation is successful, if it gets through the committee stage largely unamended, what will happen is that large amounts of money will, I think, be handed over to the states and we will not have a national approach in a whole range of different areas. This is something that obviously goes beyond the scope of the good minister at the table here now because, amongst other things, I am sure he is not a clairvoyant.7L6HOGGSenator Hogg—Do you think he could predict Carlton's fate on Saturday?ZS6Quirke, Sen JohnSenator QUIRKE—I do not know about Carlton's fate; I am just a bit more worried about Port Power at this stage, Senator Hogg. But, quite seriously, looking at issues into the future, there has been a long period of haggling between the Commonwealth and the states over very important moneys that are paid in both tied and untied grants.We are, in a sense, if this legislation is successful, sailing into a new frontier where the states will have to pick up much more responsibility for the important areas of health, education and, I guess, debt servicing—speaking now as the former shadow Treasurer in South Australia. They were always the three big issues for my state that consumed, from memory, about 67 or 68 cents in every dollar. They were in the order of education, health and, then, debt servicing. By the time you had finished with that, you had about 40 or 50 different budget items that more than happily chewed up 105 per cent of the rest because the books rarely ever balanced.I guess that is one of the key points here—the impact on my state of South Australia. We have to be very careful about this because we are not Queensland. We in South Australia are very reliant on Commonwealth outlays. We are very reliant on the Medicare arrangements that come up every so many years for discussion and agreement. South Australia is a regional economy that in many respects is not too dissimilar from the Tasmanian economy that my friend Senator Sherry described a moment ago.The concern that I have for the future is that we really have to get this right. At least in Queensland and Western Australia there is a considerable minerals base which feeds into state revenues and which can pick up any mistakes. In Victoria and New South Wales the dynamic size of their particular economies is such that they too will have growth in a whole range of different areas, unlike my state, which has been languishing and has in fact been languishing since the discovery of gold in 1851.7L6HOGGSenator Hogg—But you've got the multifunction polis.ZS6Quirke, Sen JohnSenator QUIRKE—Senator Hogg knows how to bait me. One of the best jobs I ever did was to bury that, and I will tell the Senate about that one day.WW4KEMPSenator Kemp—I thought you were a supporter of it.ZS6Quirke, Sen JohnSenator QUIRKE—No, I was not a supporter, Senator. I have got to tell you, Senator: there is always a scheme in South Australia, whether it is to make the `Athens of the south' or whether it is a bank that can go out and make more money than Rothschilds in New York. Another scheme that I have seen in my time was the insurance company that was going to go out and fix everything up around the world and bring competition into insurance—and it would cost the taxpayer only about 800 million bucks. I must say that the multifunction polis was the mirage in the mangroves and I could have a lot of discussions about that. I happily buried that, and now, just to show how neutral I am on it, the present government in South Australia wants to build the two longest strips of rust in the world: the Alice to Darwin railway. I have been provoked enough on this; there are some quotes there that I am sure people will use in the future.Senator Woodley interjecting—ZS6Quirke, Sen JohnSenator QUIRKE—There is no doubt it will go through every marginal seat in Australia at some time or other, Senator Woodley.EU4O'CHEESenator O'Chee—That is why it has to be fast tracked.ZS6Quirke, Sen JohnSenator QUIRKE—Senator O'Chee, it could be a monorail for all I care. There are very good defence reasons why the railway ought to be there, and if it is not part of the defence budget I will make this prediction now: it is never going to get off the ground.The case I am making here is that South Australia is much more vulnerable, and it is much more vulnerable to these particular pieces of legislation than the other states are—possibly not more vulnerable than Tasmania but certainly more vulnerable than the bigger eastern states and certainly more vulnerable than the developed, resource-rich Queensland and Western Australian economies. I think Cliff Walsh probably raises as many questions in his article as he answers. What he says is that the states have signed up because, in the words of former Prime Minister Keating—as relayed to the Senate last week by Senator Harradine—you should never get between the premiers and a bucket of money. It really does not matter whether they are Labor or Liberal premiers.I think we need to scrutinise very closely what is going to happen here, because in South Australia we are not going to be able to open up another mine; we are not going to be able to fiddle around with royalty rates. Sadly, and I say this also as a former shadow minister for mines, despite all of my endeavours and a bipartisan approach on mining, we have never really been able to get South Australia to understand the importance of mining—and that is true of the present government. The department of mines is one of a number of departments that are covered under the primary industries portfolio, and that illustrates just how much interest there is in that very important sector of our economy which is very poorly developed in South Australia. But, at the end of the day, the expectations in South Australia of great mineral wealth have never been truly realised, except for the Santos developments and of course Roxby Downs. Mining revenues in South Australia represent about one-tenth—I could be wrong about that—of those of Queensland, and the figures for Western Australia and even for New South Wales are similar. In fact, in the last year that I was responsible for this, the total government revenues for mining in South Australia—royalties—were only $65 million.One issue that Cliff leaves us with at the end of his article is: where do we go into the future? Are we going for more money but money over which we have no control? Is the deal going to turn out to be sour? I guess those are reasons why, on this side of politics, there have been a number of questions recently about exactly what the states are going to get and what they will lose. That has been the subject of many questions during question time in the Senate over these special two weeks of sittings. In other words: what is the bottom line figure?The other issue is: are the states capable of dealing with these issues or will we have second-class health systems in South Australia and Tasmania or a second-class education system starved of important resources whereas Queensland and Western Australia will have much better hospitals and schools because the state governments there will be much more flush, with money irrespective of how the GST debate will finish?(Quorum formed)18:22:004350Hogg, Sen JohnSenator HOGG7L6QLDALP00—I want to make a contribution in this debate—A New Tax System (Goods and Services Tax) Bill 1998 and related bills. My colleague Senator Sherry raised problems in his state and Senator Quirke seems to have said something about his state. I think my state is equally as important.HX5WOODLEYSenator Woodley—Absolutely.7L6Hogg, Sen JohnSenator HOGG—I have a great supporter in my colleague Senator Woodley. I want to look at two particular areas in my state, and I will pose some questions as I go through my brief statement. Firstly, I particularly want to look at the economic impacts as outlined in the submission of the Queensland government to the Senate Select Committee on A New Tax System. I will preface it by quoting from that submission and then address two of the issues that concern me. In their submission, the Queensland government said:The Commonwealth Government makes a number of qualitative statements in ANTS about the expected economic benefits from the package (claiming substantial economic benefits in terms of higher economic growth, more productive investment, lower industry costs and improved export outcomes).Economic modelling commissioned by the Queensland Government supports very few of the qualitative economic predictions in ANTS.. . . . . . . . .While the tax package is expected to benefit some sectors of the economy, the package will be detrimental to the welfare of Australians. Contrary to the claims made about the benefits from ANTS, economic modelling of the impact of the package found that—and a number of items were listed in the submission, among which was the issue of employment—. in the long run, the tax package would have a negligible effect on employment.On page 32 of the report A New Tax System—ANTS—Comparing Monash and MM303 by Chris Murphy, chart 5 looks at the state effects of employment: in New South Wales it is positive; in Victoria it is zero; in Queensland it is minus 5,000 jobs; in South Australia and Western Australia it is positive; in Tasmania it is negative; in the Northern Territory it is about zero; and in the ACT it is negative. Overall, it is claimed through the model that the figure is zero.Nonetheless, there is a major effect in the state of Queensland where unemployment is a major issue. I tried to work out in what sectors, in what areas, these jobs would be lost. This is what my question goes to, so I tried to relate it to chart 3 on page 27. I looked at the major areas—and this is Aus tralia wide, I presume—where jobs are going to be lost: agriculture, forestry, fishing, electricity, gas, water, the retail trade—significantly—accommodation, cafes, restaurants, communication services and cultural and recreational services. Major losses seem to be occurring in areas of prominence in my state.The question that I would ask the minister to address when I am finished is whether it is possible in some way to get a cross-referencing between those areas such that we can see whether the effect is greater in rural and regional Queensland than it is in the capital city area; if so, what steps is the government going to take to ameliorate the effects that are brought out by the government's preferred modeller, Mr Chris Murphy? In my view, it is an issue that the government has singularly failed to address at this stage. In the area of tourism, the Queensland government, in their submission, point out:Tourism related industries would be seriously disadvantaged, with Australia's tourism exports projected to be in the range of 7% to 12% below current forecasts. The tax package would lead to a substantial increase in the cost to foreigners of Australian holidays, with the foreign-currency price rising by about 3.0%. In addition, the increases in the GST-inclusive $A prices of hotels and other tourist services in Australia, would encourage Australians to choose overseas holidays in preference to domestic holidays.Of course, this is a significant area in Queensland. The Queensland government submission goes on:The tourism industry is currently a major source of employment growth and contributes approximately 6.6% to Gross State Product.This fear has been echoed in numerous press statements. For example, in the Australian of 27 February, under the heading `GST—a horror ride for theme parks', it says:`A goods and services tax would increase the price of a theme park visit by 7 per cent and force operators to sack staff,' theme park manager, OMNI, warned a Senate committee this week.The same report in the Australian goes on to say:`We anticipate that, as our major operating costs are contained in areas such as labour and food and beverages, the cost of a visit to a venue such as Dreamworld will increase by around 7 per cent,' he said.They are the words of the OMNI Human Resources Director, Don Hunter. In Queensland there is a large number of these theme parks—Movieworld, Dreamworld, Seaworld, Underwater World, Wet'n Wild and the Big Pineapple, which is a bit of an icon in Queensland. It seems from the statement in the Australian that there are substantial job losses expected in this area.Sitting suspended from 6.30 p.m. to 7.30 p.m.(Quorum formed)7L6Hogg, Sen JohnSenator HOGG—Prior to the dinner break I was looking at an article that appeared in the Australian of the 27th. It referred specifically to theme parks. There are a number of these theme parks in Queensland and I nominated those parks. A view was expressed there that the price of a theme park visit would increase by seven per cent and that this would have an adverse effect on employment in those areas. It goes back to the issue that I raised right at the outset that, in its submission to the Senate select committee inquiry, the Queensland government was concerned about the adverse effects of the GST on employment. In particular, I referred to the modelling done by Mr Chris Murphy. When one reads that in conjunction with this article, one does not necessarily have a picture of what is going on in the state of Queensland.The other article that I want to refer to appeared in the Financial Review on Thursday, 4 February. It looked more widely at the issue of losses in the tourism industry. The heading is `Tourism loss put at $6 billion'. I will quote a couple of paragraphs that I think highlight the parlous state that the GST will create in this industry. It says:Tourism task force says the GST "will mean many fewer package tourists coming to Australia because among international tourists the most important highly price sensitive segment is package tourists".It goes on further in the article:Based on these estimates, it calculates that the GST would see international visitor numbers to Australia falling by 10 per cent.Further on it says:"This would result in a loss of over 25,400 jobs and the loss of $1.6 billion per annum in export earnings, equivalent in export terms to the abolition of the sugar or iron and steel industry overnight", the submission says.So there are undoubtedly real effects to be had as a result of the GST and none more so, it seems, than in my state of Queensland, which depends heavily on tourism to generate jobs within the state.It is not just simply the matter of overseas tourists coming into Australia that is cause for concern, it is the domestic market as well. The article in the Financial Review of 4 February goes on to say:Domestic tourism would also be hit by the GST, with the price of local holidays increasing by an average of 5 per cent and domestic travel expected to fall by 4.4 per cent.So we not only have the impact on overseas tourism, we also have the impact on domestic tourism. That is why I go back to the document of Chris Murphy. I find it difficult to assess there. For Queensland the GST has the worst impact in terms of employment, at minus 5,000 jobs, according to the modelling of Mr Chris Murphy. That is the state employment shift for Queensland. It is very difficult to see it segmented in terms of industry by industry and it is also difficult to see it in terms of the various regions throughout Queensland.The government is trying to tell us that there are going to be no ill-effects from the implementation of the GST, that everyone will be better off and that everyone will be smiling and happy. But that is not the message coming out of the tourism industry or out of the Queensland government. I have focused primarily on the theme parks in south-east Queensland to start off with. However, the tourism industry is spread right throughout the whole of the state of Queensland. It depends heavily on the influx of tourists from overseas and interstate to provide jobs to many people in the state of Queensland.Other effects and impacts of the GST will undoubtedly also affect the rates of employment within Queensland in particular. Another area that is very much focused on tourism is Tasmania. Tasmania does not have the benefit that Queensland has in having some good natural resources—I will come to them in a few moments—to fall back on. Whilst there is in some sense a fall-back position for the state of Queensland, the government has done nothing. Undoubtedly the minister will at some stage refer to the financial package that Premier Beattie has agreed to, but that is not addressing this issue of unemployment.The second issue that I raise for comment by the minister concerns a submission by the Queensland Sugar Corporation. My colleague Senator Sherry referred to it in his statement earlier. The minister clarified for him the change in the diesel fuel rebate and the credit for cane transportation by rail. I was not in the chamber, but I was watching it on television. As I understood it, I think the minister said that $2.3 million was going to be taken care of by further amendments that he would put before this chamber.WW4KEMPSenator Kemp—We did not mention a figure. A figure was asked about.7L6Hogg, Sen JohnSenator HOGG—You can address that. I am interested in it. Two issues were mentioned in the submission by the cane growers. The cane growers did not speak overwhelmingly in glowing terms about the GST in their submission. They said about the proposed goods and services tax, as it was at that stage:The proposed goods and services tax legislation would have two major imposts on the Queensland raw sugar industry that do not exist under the current taxation regime.The first point they make is this:There will be an interest burden on financing an additional $20 million per month to fund GST payments until refunds are received from the ATO because of the export nature of the industry.The sugar industry depends on 85 per cent of its production being exported. It is an industry that is going to be particularly hard hit by the initiatives of this government. The second point is that the change in the diesel fuel rebate credit for cane transportation by rail will impose a cost of $2.3 million per annum on the industry. I understand the minister to have said that, whilst the figure has not necessarily been agreed to, this issue is being addressed. It is interesting to see the conclu sion of the Queensland Sugar Corporation. They said:The Hon. P. Costello in his second reading speech stated that this Bill will `help our exporters deliver more jobs and increase standard of living'. As structured, this bill will not deliver these benefits to the Queensland raw sugar industry. Rather, it will increase the industry's costs, making it less internationally competitive. This appears to be an unintended consequence of the new legislation.I think that is an understatement, because everywhere you look in this legislation there seems to be unintended consequences affecting people right across the broad spectrum of society in Australia. Again, whilst the government may have addressed the issue of the diesel fuel rebate credit for cane transportation by rail—if one accepts the submission of the Queensland Sugar Corporation, it costs $2.3 million per annum—they have not addressed the broader issue, which is the interest burden on financing an additional $20 million per month to fund GST payments. As even they point out in their submission, this will have a negative impact on jobs.Having read the Chris Murphy model, the submission by the Queensland government and the submission by the theme park and tourist operators in Queensland, and having heard from the tourist operators and heard even from a group such as Queensland Sugar about the negative impact of the GST on their industry, one can only be concerned. I would like to know from the minister how the employment issues that arise out of this will be addressed by the government, particularly in states such as mine where there seem to be real negative impacts on employment. (Quorum formed)19:46:004353Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—There are a number of issues that have been raised by Senators Sherry, Quirke and Hogg, and I will address those matters.Senator Sherry again raised a number of issues relating to comments by the Prime Minister, Senator Alston and others. The point I make is that the bill dealing with financial relations between the states is actually not before the parliament at the moment. It is a bill which is before a Senate committee of which Senator Sherry, I understand, is a member. As this bill is not before the parliament, Senator Sherry, I am not able to give you any further details on the specific question you raised.It seems to me, Senator Sherry, that you have two options if you want to discuss the issues of financial relations: the best one is to wait for the bills to appear before the parliament and then we can have a debate on it or, secondly, it is before your committee at the moment—I understand that it is reporting on Friday. So there are vehicles available to you. I know, from your very strong statements last week, that you do not want to delay debate on these bills; in fact you are very anxious that the debate move forward in an expeditious manner. Therefore, Senator, I think it would be best if we debated that bill when it is actually before the chamber.There are a number of questions that Senator Sherry put on notice regarding amendments the government will be moving. I have indicated to Senator Sherry that we will take those questions on notice.There was a theme that ran through all the comments by Senator Sherry, the senator from Tasmania, Senator Quirke, the senator from South Australia, and Senator Hogg, the senator from Queensland. In their own way they were rather unhappy about what had been done in the most recent negotiations between the government and the premiers. The point I would make to each of those senators uses not quotes from the government but quotes from the Labor premiers. I will not take the time of the Senate and run through each of those quotes.7L6HOGGSenator Hogg—Feel free.WW4Kemp, Sen RodSenator KEMP—I know that you are anxious to fill out the evening, Senator.7L6HOGGSenator Hogg—I want to listen to you as little as possible.WW4Kemp, Sen RodSenator KEMP—I am actually anxious, as I think a number of other people are, to get on to some of the amendments. Premier Beattie, Senator Hogg, in relation to Queensland made some very supportive comments and signed the agreement. Premier Bacon in relation to Tasmania—NB5CAMPBELLSenator George Campbell—Give us the quotes.WW4Kemp, Sen RodSenator KEMP—Do you want some quotes?NB5CAMPBELLSenator George Campbell—Give us direct quotes. Give us the reference.WW4Kemp, Sen RodSenator KEMP—All right. Premier Beattie, Queensland, said, `If the GST goes through—it's a matter for the Senate—we will be better off.'NB5CAMPBELLSenator George Campbell—If the GST goes through.WW4Kemp, Sen RodSenator KEMP—Thank you for asking me for the quote. I have read that into the record.NB5CAMPBELLSenator George Campbell—What is the reference?WW4Kemp, Sen RodSenator KEMP—What is the reference? It is `Peter Beattie in an interview on radio 4QR, 19 April 1999.' Senator, you asked me what the quotes were—ZW4SHERRYSenator Sherry—I want to hear the Jim Bacon quote.NB5CAMPBELLSenator George Campbell—Give us the Bacon quote.WW4Kemp, Sen RodSenator KEMP—From my memory, Premier Bacon indicated that it was an historic agreement and he was very happy to sign it. Premier Carr was equally supportive. Premier Carr was so supportive that he thought he would send Mr Della Bosca down to the Senate as a sort of consultant and to help guide the tax bills through the Senate.NB5CAMPBELLSenator George Campbell—Give us the references.WW4Kemp, Sen RodSenator KEMP—Senator, I shall give you the references when they are passed to me. I make the point that it does not make sense—at least to people on this side of the chamber and, I suspect the wider public—for Labor senators to get up and say what a shocking deal this was with the states when the state premiers have all signed the deal and made supportive comments. That is the point I make to you. I think it is quite an important point and one which is relentlessly ignored on that side of the chamber. It may well cause you some embarrassment. I can understand that. If I were a Labor Party senator, I would be embarrassed too. But the fact of the matter is that there were some exceedingly important quotes. Tasmanian Senator George Campbell asked me a question about Premier Bacon. The Tasmanian Labor Premier was quoted in the Age as saying:I am the first Tasmanian leader to go to Canberra and come away no worse off.That is very supportive. I have already quoted Premier Peter Beattie. We can keep debating what this means for the states, but the fact is that Labor Party premiers signed the agreement and Labor Party premiers made very supportive statements. Frankly, it is a bit unfortunate that either Senator Quirke or Senator Hogg made the famous statement, `Do not stand between premiers and a bucket of money.'7L6HOGGSenator Hogg—That was Senator Quirke.WW4Kemp, Sen RodSenator KEMP—It seems to me that you undervalue your colleagues. In the way you have spoken, you have undervalued the objectivity and the commitment that state premiers have to their states. Each of those state premiers saw that his state would be better off with the dramatic and historic changes that this package has brought about. Senator Quirke quoted his friend Cliff Walsh. I also claim Cliff Walsh as a friend. However, I look forward to reading his article more closely now that Senator Quirke has drawn it to my attention. The question is: where is this money being spent? This money is generally being spent on health, education, welfare and other state services.ZW4SHERRYSenator Sherry—But you cut funding.WW4Kemp, Sen RodSenator KEMP—Senator Sherry, you think we have cut funding, but your Labor Premier is very comfortable with the agreement. It seems odd to me that you stand up in this parliament and argue this case. Similarly, Senator Hogg stood up and argued this case. The argument then is: do we accept what the premiers said about their own states? They had all their advisers there. Presumably, Premier Bacon had Treasurer Crean there to advise him. I am not privy to what Treasurer Crean might have said, but I assume that he carefully went through the sorts of figures that you have gone through, Senator Sherry, and Treasurer Crean decided that this was a good deal for the states. Let me read some comments from Premier Bob Carr. He said:I have got to say that I have never been at a more successful Premiers Conference in the four years that I have been in this job.Senator Sherry attacks the premiers and the agreement, but that is what Premier Carr said. He went on to say:It does seem a transformation. It is the national government handing over a growth tax that is going to be the basis for state revenues from now on in . . . It gives us a growth tax in place of the smaller messy business taxes that we have had to count on as we have tried to meet people's needs for schools, hospitals and so on.That was Premier Carr saying those lines—it was not a Liberal Premier or a Liberal spokesman but a member of your own party. Premier Carr was there, as were the other premiers, with his Treasurer and advisers, and he clearly decided that this was a very important and historic agreement.In contrast to the position of Senators Sherry, Hogg and Quirke, we have the position which has been strongly asserted by Labor Party premiers about what an excellent conference this was and what a good deal it was for the states. Senator Quirke put another argument. He asked, `What does this mean for the federal system? Is it really a good thing that large amounts of money are being handed over to the states?' I think I am quoting Senator Quirke correctly. That is in contrast to Senator Sherry's position. It is important for Senator Sherry and Senator Quirke to realise that lower growth states are often more reliant on government expenditure and that they benefit most from a growth tax. The premiers of South Australia and Tasmania have recognised this and have signed up for the deal.However much distress this may cause to their federal colleagues, the fact is that state premiers, with their treasurers, advisers and the analysis they had before them, decided that this was an excellent deal for the states. Not surprisingly, they signed up. Senator Quirke asked, `Are the states capable of dealing with these issues?' In a rhetorical sense, I suppose he was asking whether Premiers Bacon, Carr, Beattie and Olsen are capable of dealing with these issues. If they look closely at their Labor Party representatives in the Senate, they would probably feel that they are pretty capable of dealing with these issues.The states have very real needs in our federal system. I believe that one of the many advantages of this tax package is that those particular needs are effectively addressed. The other point I would make is that these premiers actually won elections.GB6COLLINSSenator Jacinta Collins—The Queensland one?WW4Kemp, Sen RodSenator KEMP—Senator Collins, it is quite important to win an election. It is the difference between being over here and being over there and all the associated things which flow from that. These premiers who won elections, including Labor premiers, strongly support this particular package. Senator Hogg then went on to an argument about jobs. He seemed to suggest that the GST was bad for jobs, particularly in the tourism sector.GB6COLLINSSenator Jacinta Collins—Even you have accepted that.WW4Kemp, Sen RodSenator KEMP—You had better go and tell the French government that. Paris is a major tourist centre and has had a GST type tax for a long period of time. But Senator Hogg has suddenly discovered that a goods and services tax is bad for tourism. That does not seem to have worked elsewhere in the world. There are many countries with goods and services type taxes in which tourism is absolutely thriving. Senator Hogg quoted some models. He quoted the Murphy model. Frankly, there are a host of models which I have quoted in the Senate on a number of occasions which show that in fact there are extremely beneficial effects on the economy of the tax reform package that we are bringing in.GB6COLLINSSenator Jacinta Collins—That has not been demonstrated.WW4Kemp, Sen RodSenator KEMP—I am glad you went back to your seat to make that comment, Senator Collins. There are a number of other issues which Senator Hogg raised in relation to the sugar industry, which I have to say by and large but not exclusively were essentially the same issues as Senator Sherry raised. I know you are not trying to waste time, Senator Hogg, and repeat exactly the same questions. In relation to the sugar industry and the issue that Senator Sherry raised and you raised, my advice is that the issue has been resolved and they will get as generous treatment as they get now for diesel. In fact, they will benefit from on-road rebates for heavy transport for the first time. (Time expired)20:02:004356Hogg, Sen JohnSenator HOGG7L6QLDALP00—Thank you very much, Senator Kemp, for giving us a French lesson this evening. I was talking about the Queensland government. I was not going to comment on this area but you have now opened it up, and I think that that is a very good thing indeed.WW4KEMPSenator Kemp—You can waste some more time.7L6Hogg, Sen JohnSenator HOGG—No, I am not wasting more time. I came here with quite specific questions. With respect to what you are talking about, that was specifically related to the intergovernmental financial relations between the state and the federal government. It was not an acceptance by the Queensland Labor government of the GST. It never was, and you know that to be the case. I will just quote from the submission of the Queensland government to the select committee. This is what they had to say about the area that you focused on as being interpreted as saying that the Queensland government had accepted the GST:The Queensland Government is particularly concerned that there are serious deficiencies in the proposed reforms of Commonwealth-State financial arrangements which form part of the overall tax package. In the transition period, the Commonwealth proposals, supported by other jurisdictions at the special Premiers Conference on 13 November 1998, disadvantaged Queensland taxpayers and penalised the Queensland Government for its longstanding policies of low taxation and responsible fiscal management. On current estimates, the loss to Queensland is around $465 million over three years.So what the Queensland government were concerned about, and rightfully concerned about, was the loss of $465 million over a three-year period. They were not acquiescing to a GST. That is not the way their support of the financial relations between the Common wealth and the state can be interpreted. It is a complete misinterpretation. They go on to say in their submission:Specifically, the proposed compensation arrangements for loss of State revenues in the transition period are grossly unfair and discriminatory.They significantly point out two things about these arrangements:They contravene the widely accepted principle of horizontal fiscal equalisation on which the distribution of Commonwealth grants has long been based; and, secondly, they also produce an increase in the effective level of taxation in Queensland relative to other States, for which there is no compensation in the first three years.That is what that was about, specifically that issue. That is what Peter Beattie, as the Premier of Queensland, was arguing and at odds with the federal government about. That is the issue. He was not accepting the GST. He had to look to better financial arrangements for the people of Queensland, who were going to be disadvantaged by the package that the government were putting forward. They go on further:The Commonwealth also sought to justify the compensation arrangements solely in terms of dollar impacts on the bottom line of State budgets. This is deceptively simple but conveniently misleading. In reality, a State budget cannot be considered separately from the tax burden imposed on taxpayers in a State and hence the revenue stream which supports its budget. There can be no denying that the relative tax burden for Queensland taxpayers will be increased under the Commonwealth's proposals, with no commensurate return to the State budget for at least the first three years. As a result, the Queensland Government will be unjustly deprived of its legitimate entitlement to the extra $465 million in additional taxes paid by Queensland taxpayers during the transition period.YW4MACDONALDSenator Ian Macdonald—Why did they sign up to the agreement?7L6Hogg, Sen JohnSenator HOGG—Because they are protecting Queenslanders' interests. It does not mean that they accept the GST. They do not accept the GST. How many times do you want that said? They do not accept the GST.WW4KEMPSenator Kemp—And you aren't wasting time!7L6Hogg, Sen JohnSenator HOGG—So what we have, thanks to your invitation, Minister, is my taking a few moments to put that issue in its correct perspective.20:07:004357Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—The issue that you raised was an early submission, I suspect. It cannot be denied that after the Premiers Conference, in an interview on radio 4QR on 19 April 1999, Premier Beattie said:Queensland if the GST goes through—it is a matter for the Senate—will be better off.For all those words that you enlightened the Senate with, Senator, the bottom line is that your Premier, in contrast to your position, believes that this is a good deal for Queensland. I suspect that you are reading from a very early submission. The issue that Premier Beattie was concerned about was fixed at the Premiers Conference.7L6HOGGSenator Hogg—But that does not mean he accepts the GST.WW4Kemp, Sen RodSenator KEMP—No, but you are saying that this is a better deal for Queensland. You are trying to indicate to me that it was a worse deal for Queensland. I am telling you that it is a better deal for Queensland.7L6HOGGSenator Hogg—You are twisting his words.WW4Kemp, Sen RodSenator KEMP—A number of Labor Party premiers spoke about the importance of mandates, including Premier Carr and Premier Bacon. Of course they were elected on promises and they expect to put into effect their promises, as we expect to put into effect our promises.You raised two issues in relation to the sugarcane producers. Before the siren sounded I did not have time to get to that point. The first issue I have referred to but you also referred to a cash flow issue. The cash flow issue is more than offset by the reduction in embedded taxes. Tax reform eliminates nine classes of cascading type taxes. Indeed many cane producers will presumably be entitled to input tax credits on receipts which often come before payment. (Quorum formed)20:11:004357Hogg, Sen JohnSenator HOGG7L6QLDALP00—Minister, I did raise some other issues about the employment side which you did not address in responding about the tourist industry. I may come back to those other issues later, but I am interested in what you might have to say about the tourist industry. I did make some specific comments and, whilst you said that the Chris Murphy model was but just one model, I am just wondering—seeing that the government accepts this model so well—if you can interpolate from those tables for me the effects on employment.The reason I raise this is that there was a report done for the Senate employment committee by Dixon and Rimmer, which I am sure you are aware of, which looked at the impact of the government's proposed tax package by regions. Specifically, in Queensland under what they call the `central simulation', in columns 2, 3 and 4 for after tax wage bargaining—which is the best case scenario, I understand—the best case scenario provides 5,444 jobs in the positive.The worst case scenario, which I am led to believe is the more likely case, provides for some 22,681 jobs to be lost. These are statistical divisions. The worst case scenario says that 10,786 jobs have been lost in the Brisbane statistical division; and, even with the best case scenario, 4,916. In some of the other regions, even under the best case scenario, there are losses. These are not necessarily all tourist areas; nonetheless, they are significant in the state of Queensland because of the fact that we are predominantly, outside of being a mining and an agricultural state, very heavily into tourism.So can you address the ways in which you see the government redressing any—and we can use the words of the sugarcane producers—`unintended consequences' of the legislation on the tourism industry, even if you do not necessarily concede that all the figures are the figures that you would like to see? Even as late as today, in the Sydney Morning Herald there is an article on tourism and the GST. Entitled `Tourism will suffer, industry warns', it says:Five of the world's biggest wholesalers of Australian holidays to overseas tourists have warned they will stop promoting Australia as a value-for-money destination if the GST is imposed on the tourism industry.Tourism services, such as accommodation, food and most domestic travel, will incur a GST which will make Australia a less attractive destination, according to tourism industry representatives. Inbound Tourism Organisation's managing director, Mr Peter Shelley, said Goway Travel, FTI Touristik, JTB World Vacations and Travelbag, the largest marketers of Australian holidays to Europeans, Canadian and Japanese tourists, had written to warn that overseas visitors would be deterred by higher prices.The cost of travelling in Australia is expected to rise between 5 and 10 per cent if the GST is introduced.That was reported only today. So the concern remains. We are having this debate about the ANTS package, which you are so readily prepared to laud and praise, yet there are grave concerns out there when it comes to states such as mine where we see the effects in major industries, such as the tourism industry, which is responsible for 6.6 per cent of the state's domestic product. So, Minister, if you could be a bit more reassuring in the answers that you give, I would be anxious to hear them.20:17:004358Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—The Murphy model, which you quoted, assumed no change in employment.7L6HOGGSenator Hogg—Not in Queensland.WW4Kemp, Sen RodSenator KEMP—It assumed no change in employment overall, I understand, therefore in the modelling some sectors would gain and some sectors would lose.7L6HOGGSenator Hogg—But what about Queensland?NB5CAMPBELLSenator George Campbell—But not in Queensland and Tasmania.WW4Kemp, Sen RodSenator KEMP—There is a variety of models which, of course, shows that the government's package has very positive effects on employment. The central point of even Peter Dixon—the Labor Party modeller of choice—on employment was that it will be stimulated in the short run by about 30,000 jobs. This was supported by forecasts from other modellers. Access has the unemployment rate falling by 0.9 of a percentage point in 2000-01, while Chris Murphy's Econtech has it falling by 0.6 of a percentage point.We can all quote a variety of models, but we think the overwhelming weight of evidence is that this package is good for the economy and good for growth in jobs. You have quoted one particular set of figures, but I have to say that, in fairness, if you look at the overwhelming weight of evidence that was produced by modellers before the committee—and, indeed, frankly, to my mind it is commonsense—it shows that this package is good for jobs.As I said, you are quoting the Murphy model. The assumption, I understand, in the Murphy model was to issue zero growth. That was one of the assumptions and, as a result, some sectors would gain and some sectors would fall. In relation to the tourism sector, I pointed out to you before that all around the world there are countries with thriving tourism sectors which have GST type taxes. Equally, my understanding is that there are divisions amongst the various industry bodies in the tourism sector—and my understanding is that this includes the Tourism Council of Australia—which are supportive of the tax reform package.20:19:004359Sherry, Sen NickSenator SHERRYZW4TASALP00—I have a couple of matters that I would like to respond to in respect of Senator Kemp's earlier comments. I was careful—and I am sure that the Hansard record will show this—when referring to the financial split of the GST revenues that will flow to the states to make the point that the agreement reached between the premiers and the Treasurer, Mr Costello, and the Prime Minister related to the issue of the carve-up of the moneys that were to flow to the states. They went away satisfied on that issue, but that did not mean, and does not mean, that they are not concerned about the economic impact of a GST on particular regions and state economies throughout Australia.It might escape you, Senator Kemp, but there is a clear distinction between the financial arrangements—the carve-up of the money—and the economic impact of a GST on particular sectors of the economy. There has been some discussion about the tourism industry. This is important in respect of Queensland and Tasmania because, as a percentage of their state gross domestic product, both of these state economies are more reliant on tourism than are other states throughout Australia.If you impose a new tax, a GST—even if it is replacing a range of other taxes, particularly the wholesale sales tax—it is commonsense that those industries that are not taxed as significantly by a wholesale sales tax, such as tourism, will not benefit. When you remove the wholesale sales tax there is a benefit to some industries and not to others, particularly when you then impose a 10 per cent GST right across all industry sectors.All the research shows that, with a GST, some industry sectors are clear winners and some are clear losers. The mining industry is a winner while tourism is a clear loser. It must be. There is almost no reduction in cost as a result of the abolition of the wholesale sales tax, and if you add a 10 per cent GST then the tourist industry must be a net loser in terms of the economic sectors. Because Tasmania and Queensland are reliant on tourism more than other sectors around Australia, the GST has a net adverse effect that flows through to the Tasmanian and Queensland economies. And that is the point. If there is any growth in employment as a result of the government's tax package, it does not come from the goods and services tax; it comes from the income tax reductions. I can see Senator Kemp saying, `So what.' The point is the income tax cuts can be delivered tomorrow without a GST. The income tax cuts are largely funded from a budget surplus; they are not funded by the GST. We do not like the regressivity of the income tax cuts because they deliver far more to higher income earners than lower and middle income earners, but putting that issue aside the government can deliver those income tax cuts tomorrow without the adverse consequences of a goods and services tax. I know my colleague Senator Murphy is going to touch on the wine and tourism industries and the particular problems that they face, so I will not comment further on them.What response did we get from Senator Kemp to reassure us that everything was going to be hunky-dory in the tourist industry? He referred us to the French. He said, `Well, it will be okay—the French, the French.' We waited with bated breath to hear the startling evidence from France about the impact of a GST on the tourist industry, but we did not get anything further. All we got was: `The French, the French, look at the French.'FX5MURPHYSenator Murphy—They had a revolution.ZW4Sherry, Sen NickSenator SHERRY—They had a revolution—and that was largely because of tax, too. I might say to the committee that the French invented the GST back in the 1930s, I think it was. They were the ones who first introduced this devil of a tax. It was hardly reassuring evidence from Senator Kemp that the tourist industry will be okay—just look at the French. There was no follow-up evidence to give us any detail on why the French example is so important in reassuring the Australian industry about the impact of a GST. I note the quotes from Senator Hogg that one sector of the tourist industry, the inbound tourism industry, is very concerned about the impact of a GST, because the way in which the GST will apply will clearly disadvantage the Australian industry vis-a-vis foreign tourist package sales. Mr Shelley, who is a former distinguished Tasmanian—unfortunately, there are so many people leaving Tasmania and moving to the mainland; and the GST is just going to accelerate that, given its economic impact—was highlighting this very issue in today's media, and rightly so.The GST is a 10 per cent tax on Australia's largest export industry—tourism. Tourism is our largest export dollar earner and the fastest growing employer of Australians. One of the claims the government makes is that the GST is good for exports. If it is good for exports, then logically—or lack of logic—why are we taxing with a new tax our biggest export earner, the tourist industry? The other point I would make is that Premier Bacon, a good friend and close colleague of mine who cut a good deal in the financial allocation of the moneys—as he needed to do—has not withdrawn at all from his concerns about the economic impact of a GST on Tasmania. I started, although I did not finish, to touch on the particular problems of Tasmania vis-a-vis a GST a little earlier this evening. Premier Bacon, as he is quoted in the media, cut the best deal in financial allocation compared with previous Liberal premiers. Let us get the quote in its context: Premier Bacon was comparing his performance with the miserable performance of previous Liberal premiers—Robin Gray and Tony Rundle. In part, one of the reasons why you suffered political annihilation at a federal and state level in Tasmania last year within the space of four weeks was the miserable performance put in by the former Liberal premiers in the running of the Tasmanian economy. Fortunately, we now have a majority Bacon Labor government to correct some of the dire problems facing Tasmania.Premier Bacon has made it very clear that he does not want a GST because its economic impact will hurt Tasmania. Tasmanians are low income earners. The average income in Tasmania is about $25 to $30—I cannot recall the exact figures—below the average wage in the rest of Australia. The number of social security recipients, as I remarked earlier, is higher than the national average. We also have an ageing population. We have significant problems in funding our health system, in part because the Prime Minister, Mr Howard, refused to allocate the moneys that he promised to Tasmania's health system. For all those sorts of problems, Premier Bacon and the state Labor Party in Tasmania do not withdraw or retract in any way their concerns about the impact of the tax package. Just to conclude, I referred earlier in my introductory remarks to the breakdown of figures state by state and I quoted some figures for Tasmania. I referred to them in the context of the false claims made by the Prime Minister about the level to which the states would be financially better off with a GST. I note that you did not make a response to that, Senator Kemp. We would like the correct figures for the record. We would like to know how much the states would be financially better off under a GST. I believe the correct figures that I referred to earlier highlight the fact that this is one of a number of areas where the Prime Minister, Mr Howard, has misled the Australian public about this particular issue. With those few remarks, I hope we get a comprehensive and detailed response from you about those particular issues.There is one other matter—the sugar industry. Senator Hogg rightly referred to the cash flow implications. I mention that because I sought to obtain from you, Senator Kemp, information about the amendment that is in the package of 128 amendments. I sought to clarify the matter in respect of the sugar industry. I will give you one piece of credit at least—you did clarify that matter for me. Senator Hogg is still rightly concerned as a Queenslander about the impact on the cash flow of the Queensland Sugar Corporation and quite rightly raised that as an important issue in the Queensland context.20:31:004361Woodley, Sen JohnSenator WOODLEYHX5QLDAD00—I support what Senator Sherry and Senator Hogg have been saying, but I have a question for them at the end. Senator Kemp and I have travelled together on previous occasions to Queensland. I invite you to come with me to Cairns. If you think there is any misapprehension about the effect of a GST on the inbound tourism industry, I can assure you that would be quickly dispelled. Cairns is one of the areas which would be most affected if inbound tourism packages are subject to a GST. It would be devastating to that export industry, and I support what Senator Sherry and Senator Hogg have said about that. I am sure that it would have the same effect on tourism in Tasmania, but I am personally acquainted with the effect of inbound tourism packages being subject to a GST, and have certainly had my ear bent on this matter by tourism operators in Cairns. I reinforce what has been said. Senator Hogg or Senator Sherry, it seems that you are suggesting that Labor may support the Democrat amendment, which would fix the problem for inbound tourism. You may like to respond to that.20:33:004361Sherry, Sen NickSenator SHERRYZW4TASALP00—There is one way to cover that issue, Senator—vote the GST down. It is a very simple solution—vote it down. That is what we intend to do.20:33:004361Woodley, Sen JohnSenator WOODLEYHX5QLDAD00—I am very happy to get that response from Senator Sherry. There are two ways: one is to vote the tax down; the other is to sup port the amendment from the Democrats prior to doing that, and in that way you will have an insurance. I look for your support.20:34:004361Murphy, Sen ShayneSenator MURPHYFX5TASALP00—I want to address one issue: the government and the Assistant Treasurer keep saying that the Labor state governments—and, in particular, my state government—support the GST. I do not know how you conclude that. State governments come to the Premiers Conference to meet with the Commonwealth, which grants them money, as a result of tax collecting, for a whole range of publicly provided services. That is what the state governments come to Canberra for. They would do that with or without the GST. They would seek to negotiate an outcome that would be in the best interest of each particular state, with or without the GST. Coming to Canberra to negotiate with the Commonwealth about revenue to be paid to the states has nothing to do with the GST.Of course, the government wants it to have something to do with the GST because it is seeking to employ the support of the states, so somehow it gets this massive spin on the outcome of such negotiations. All of a sudden, it says, `Labor premiers are in support of a GST.' The fact of the matter is that they are not. The Tasmanian state government's submission to the Senate inquiry was totally opposed to the GST. That does not mean to say that it ought not come to Canberra to negotiate a revenue outcome for the state—regardless of the tax system—that is in the best interest of the state. That is the responsibility and role of the state government. It ought to be clearly understood that it has nothing to do with supporting a GST.Why doesn't the Tasmanian government support a GST? Because it understands the negative impacts on a whole host of things, such as the people who live within the state of Tasmania in particular, the people who will lose their jobs, and the pensioners, who are supposed to somehow get this miracle four per cent increase in their pension—which is really only 1½ per cent, which is supposed to compensate them for the acknowledged 1.9 per cent increase in the CPI. The reality is something different entirely.Let me go to the issue of jobs in Tassie. We, probably above any other state, are in the worst position in respect of any job losses. If we suffer any job loss, it is significant. We know—and it is on the record as a fact—that we have negative population growth, so we cannot afford to support anything that will have a negative impact on employment—and it will in Tasmania, as has been said by other senators.The tourism industry is of fundamental importance to my state. I think Senator Kemp, the Assistant Treasurer, said earlier with regard to the application of a GST to the tourism industry—and I do not want to misquote you, Senator Kemp—that there are other countries with a GST that have a thriving tourism industry. I am very interested in that comment because, as I understand it—and you might like to clarify this for me when you respond—those countries that do have a GST and that may have a thriving tourism industry also have a rebate system or a concessional system; that is, the tourists either are not paying or are only part paying a GST. I would like to hear your response to that because it is interesting with regard to the tourism industry as to why you zero rate commodity and manufacturing exports yet not tourism.As I said, this will have a catastrophic effect for us in Tasmania. We do struggle in relation to tourism. We have some very magnificent attributes in our environment but we are in a very competitive market in so far as tourism is concerned, even with the rest of this country. So it is important that, when we come here to debate issues that have a capacity to affect, and will have a significant effect on, our industries and potentially cause significant job losses, we weigh up all of these things. Even if there were good points in the application of a GST, one thing is for certain: it will have a very detrimental effect on the Tasmanian tourism industry.I want to go to the issue of the wine equalisation tax. The government said, `No new taxes,' yet, as I understand it—WW4KEMPSenator Kemp—You went to an election on this.FX5Murphy, Sen ShayneSenator MURPHY—Hang on a minute, Senator Kemp. The GST, you said, was a thing that would get rid of a broken tax system—you were going to get rid of all these hidden taxes.10000TEMPORARY CHAIRMANThe TEMPORARY CHAIRMAN (Senator Ferguson)—Senator Murphy, would you please address your remarks to the chair.FX5Murphy, Sen ShayneSenator MURPHY—As the Assistant Treasurer was saying: the GST was supposed to remove this raft of hidden taxes known as the wholesale sales tax and replace it with another tax system that would make a whole host of things cheaper and, in essence, would make everybody better off. We would all be happy and could wander off into the sunset and live happily ever after—well, not so.The reason the wine equalisation tax is so important for us in Tasmania is that our wine industry is very much attached to our tourism industry. I do not want to go into the argument about ad valorem or volumetric applications because I do understand some argument with regard to other sections of the wine industry and, of course, Mr Temporary Chairman, in your own state it is a very important matter—in both sectors, I might say. But in Tasmania it is particularly important because we really have only a small wine industry, but it is a very important industry.7L6HOGGSenator Hogg—A very good industry.FX5Murphy, Sen ShayneSenator MURPHY—As Senator Hogg has said: it is a very good wine industry. It is very important, and it is growing. I can demonstrate to you by way of an example the sort of growth that is occurring. By way of a good news story, which we are very thankful for, a local winemaker at a very small boutique winery, Iron Pot Bay Wines, has won a contract to supply Qantas. That is very important, and it will clearly assist this winery to grow. The other aspect as to why all this is so important is that we are very much a regional area of Australia. Where do all of the small wineries exist? They exist in the regions of Australia. The regions of Australia are those areas that suffer the worst in terms of employment, so why would the government want to impose a tax system upon an industry in the regions of Australia that has the potential to grow, that is growing substantially— and that can grow even more—that will force it backwards? That makes no sense at all. That is another reason why the GST should not proceed.The Pipers Brook Winery has invested some $30-odd million in growing their winery. There is a series of small wineries in the north and north-east of Tasmania that are very directly linked to the tourism industry. We have wine tours, and they are a significant and growing market in our tourism industry, yet the government is going to put this tax on them, and it is not a neutral tax. This is not taking away this big, ugly, hidden wholesale sales tax and replacing it with something better, something that will actually make things cheaper and help grow the wine industry in Tasmania and help the tourism industry. We are going to take another $147 million from the wine industry, and a significant amount of that will come from the small wineries that all make bottled wine; their primary production is bottled wine.ZW4SHERRYSenator Sherry—Does that happen in France?FX5Murphy, Sen ShayneSenator MURPHY—I do not know whether it happens in France. Perhaps the Assistant Treasurer could tell us about it. As the Prime Minister once said, we all want to feel warm, comfortable and relaxed with the GST. That is how he wants to see the battlers of Australia. I do not think that is going to be the case for the battlers of Tasmania, because we have a situation where everything is more expensive in our state. Petrol is more expensive and will be even more expensive under a GST. Groceries are more expensive and will be more expensive under a GST. Let me give you an example of why groceries will be more expensive, particularly in the smaller towns throughout Tasmania and, indeed, in most regional areas of Australia. Small retail grocers will actually have to increase their prices by seven per cent on each item just to maintain the same level of income under a GST. That is a fact. They will have to increase the price of each product they sell by seven per cent just to stand still, let alone make any more money, with the application of a GST.As I said earlier, the government has said in its ANTS package to pensioners, `You will get four per cent up-front.' But you can go through all of the documentation, all of the minority reports that were made by government senators in the various committees that looked into the application of a GST, and nowhere will you find where they say that the four per cent will be clawed back by 2½ per cent because the normal indexation movements will not occur until 2½ per cent in pension increases has been taken back. The net effect of that: pensioners end up with just 1½ per cent. End of story.The government claims the CPI will increase by only 1.9 per cent, but Treasury has acknowledged that it could go up by as much as three per cent and I think some others have said that it could increase by as much as six per cent. How does 1½ per cent compensate for that? Of course that does not help with the cost of living for all the pension recipients. It does not help charities, which have stated categorically that they will incur costs. In my own state, additional costs for administration for charities will be in the order of $5 million. That is $5 million in a state that has the highest unemployment and the highest need for charitable services that are provided to people who just cannot cope—$5 million that they will lose which should have gone into very much needed services. There is no explanation for that from the government. I hope that the Assistant Treasurer might throw some light on some of those issues in his response, because there are some others that I have questions about.(Quorum formed)20:50:004363Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—We had another wide-ranging speech from Senator Murphy—I think more in the order of a second reading speech. In fact, we have had a number of second reading type speeches this evening and that happens to be another one. I was mindful that Senator Sherry said just 24 hours ago—or was it 48 hours ago—how anxious we were to progress the debate on these bills.7L6HOGGSenator Hogg—You slowed it down.WW4Kemp, Sen RodSenator KEMP—I just record that as a matter of interest, Senator. In relation to the tourism industry, one of a number of issues, we have debated what the premiers said, what the premiers did not say and whether the premiers agreed there was a mandate. I just record the fact that some very supportive comments came from Labor Party premiers after the recent historic Premiers Conference in Canberra.The issue of the tourism industry was raised by Senator Murphy and by Senator Hogg, and I would have to recheck the Hansard because I am not sure whether some of the points that were put on the table are correct or not. But let me clarify the position. The government's treatment of inbound tourism expenditure is consistent with international practice whereby goods and services are taxed in the country where they are consumed. This does not discriminate against the Australian tourism industry but rather puts it on the same footing as tourism in other countries.Nevertheless—and this is perhaps where we need to look at the Hansard—the GST will not apply to a number of purchases by tourists which in total comprise more than half of the inbound tourism expenditure. These include international air and sea travel and domestic air travel purchased overseas by non-residents—it was not clear from your remarks whether that was appreciated—continuous domestic legs of international flights and goods purchased in Australia by inbound tourists. These will attract a refund at the departure gate of the GST paid. That was another point which you made.FX5MURPHYSenator Murphy—What about accommodation and meals in restaurants?WW4Kemp, Sen RodSenator KEMP—Let me finish, Senator; you have made your remarks. These will attract a refund at the departure gate of the GST paid, subject of course to a minimum purchase of $300 in a single store made within 28 days of departure. Tax reform will reduce costs of tourism operators by removing hidden taxes and it will allow the New South Wales and the Northern Territory governments to remove their bed taxes.In relation to the wine industry, there was a variety of evidence put before the Senate committee, and I will quote some of the evidence that was given to that committee. The Winemakers Federation of Australia commissioned their own modelling of the tax package on the wine industry from the Centre of International Economic Studies at the University of South Australia and they are still consulting. Mr Brian Crozer, President of the WFA, told the Senate select committee hearing in Adelaide that the results of the modelling showed that under our tax package everybody wins. Mr Crozer said that under an ad valorem system, which is a continuation of the current system, the non-premium wine sector benefits more than the premium wine sector but that both sectors benefit under a GST whatever top-up system. That was the evidence which was given to the Senate committee.You are shaking your head, but this is the advice that I have received and it was evidence which was given to the Senate committee. That is why, when asked by Senator Sherry whether they support the package, they said they would reserve judgment. Mr Crozer added:From our viewpoint, looking at our industry in isolation, even with the 31.7 per cent estimate of the WET tax level—of course, WET is lower than that—the package is positive for our industry.We can adduce various bits of evidence which are put forward, but this was evidence which was given to the Senate select committee.3L6CONROYSenator Conroy—You should get a better briefing on their evidence.WW4Kemp, Sen RodSenator KEMP—My understanding is that this is the evidence that was given to that particular committee.20:55:004364Brown, Sen BobSenator BROWNQD4TASAG00—The position of Tasmania as far as the GST is concerned is particularly invidious. I will ask a question at the outset, and then come back to it. Has the government done any studies of the comparative advantage or disadvantage of Tasmania as against the mainland where 97 per cent of Australians reside, particularly taking into account the fact that the head offices—and therefore the distribution of profits—of the major resource extraction corporations operating in Tasmania are almost all on the mainland or outside Tasmania? For example, the biggest forest extractor and woodchip exporter most responsible for the two-thirds of export woodchips out of Australia which come from Tasmania is North, which has its headquarters in St Kilda Road in Melbourne. And Comalco is not far away. Of course, most of the mining, logging and these days even tourism corporations at the top end of profitability are not in Tasmania but on the mainland.However, even where larger firms are operating in Tasmania, they are going to be hidden beneficiaries of the changing tax system. For example, payroll tax—which does not apply to many small businesses in Tasmania but does apply to bigger businesses—is going to presumably be removed in return for the flow of moneys from the GST. If not, other taxation alternatives which are of advantage to big corporations in particular will be going. The minister shakes his head—and I accept that; that is what this debate is about—so I will ask the minister to say what is expected in so far as Tasmanian state taxes are concerned. If there is no change at all, then let the committee know. If there are changes, please let the committee know that.One thing I do agree with the minister about is the appearance by Labor Premier Jim Bacon from Tasmania when he came to Canberra to that meeting on the GST taxes where the premiers were unanimous in accepting with praise the deal they got on that day. Jim Bacon was particularly injudicious. It was a very silly thing for a Labor Premier, who is ostensibly holding the Labor position of being opposed to the GST, to come to Canberra and do. Instead of saying, `Well, I've got what the state at least deserves in terms of its contribution to the exports and the wealth of the nation as a whole,' he could not help but get his ego in the way of that and say, `I've got more than many recent Tasmanian premiers,' and allow the government to do just what it is doing now, and that is to say that they have ostensibly got the support of a Labor Premier in Tasmania for the GST. That is how it appeared on the television news services and that is how most Tasmanians—as well as people elsewhere around the country—would have read it. It just showed a naivety and a silliness by Premier Bacon which with a little forethought—and perhaps he needed advice on this—he could have avoided.I am aware that Premier Bacon is very often more comfortable with the big corporate sector in Tasmania than he is with the electorate that Labor is more likely to be recognised as serving. He is an anti-Democrat. He was one of those principally responsible for changing Tasmania's democratic system to advantage the big parties just last year, to the detriment of the state's extraordinarily fair democratic system.But those things aside, it did take the Green, Peg Putt, to introduce a motion to the state parliament about this iniquitous wine equalisation tax that Senator Murphy has been talking about. The Labor Party and the Liberal Party, to their credit, joined in making it a unanimous vote in the House of Assembly to have the federal government look again, because that is going to hit small business in Tasmania.FX5MURPHYSenator Murphy—It was amended by the Liberals.QD4Brown, Sen BobSenator BROWN—It was amended by the Liberals, says Senator Murphy. The point I am making is the initiative came from the Greens, because for so long they have been saying that clean, green agriculture, small business, high quality design and high quality products, particularly in the areas of foodstuffs and beverages for export, are going to be the future lifeblood of Tasmania. It is the Greens who have taken the initiative here and who are very pleased to have found unanimity in the Tasmanian outrage about the impact that this is going to have on the Tasmanian wine industry.This industry is almost exclusively in the business of selling bottled wines, not cask wines, and so is almost to a seller going to be disadvantaged compared with the big bulk-consuming mainland wine producers, particularly the cask wine sellers. The cask wine sellers, by the way, are in the business of importing wine to put into those casks. As Senator Murphy says, they are not, as with the Tasmanian industry, exclusively in the business of producing wine from Tasmania and selling it into the tourism industry. The Tasmanian wine industry sells also through restaurants and high quality outlets throughout Australia and increasingly overseas.This iniquitous tax is going to hit them for a sixer. And as the minister will know, when you impose a tax on small businesses some of which are marginal, particularly because they have large establishment costs and have gone into debt, then you are going to knock out some of them. You are simply going to increase the failure rate. That is what this tax will do. It would be good news indeed if, during the course of this debate, we could get some progress towards offsetting the penalty on the Tasmanian producers, which I think is going to add something like $1 or $2 to the price of a bottle of wine as compared with the same volume of wine if you buy it by the cask.So I echo the sentiments of Senator Murphy there and appeal to the government to look again at that one. That is not going to make or break the government, but it is going to make or break vineyards, who are high job creators in Tasmania and elsewhere around this country—in Western Australia and in small vineyards up the eastern areas of Victoria, New South Wales and Queensland. It is very important that the government look again at that one.Finally, I want to say that the government has made this tax package totally unacceptable to the Greens. We have been consistent, following a year's study into the GST but from well before the last election, in opposing the GST. If anything could have hardened this resolve it was this decision to have a $3 billion a year gift through the diesel fuel rebate, the majority of which is going to the big corporations again, to the transport corporations in particular.4L6EGGLESTONSenator Eggleston—Cheaper transport means cheaper goods.QD4Brown, Sen BobSenator BROWN—Senator Eggleston opposite says cheaper goods. Well, that is one way of looking at it. That is a mantra. What it actually does is line the pockets of the already wealthy and give them an advantage over a whole range of small businesses which could have been given this $3 billion a year lift but which are not going to get it because, in the main, it is going to the big corporations.On our calculations one of the outcomes of that, for example, will be that for the big woodchip corporations like North the cost of getting a tonne of woodchips out of prime tourism job creating forests in Tasmania, including rainforests, is going to be diminished by a dollar a tonne. It is going to make it cheaper for them to rip out those forests where, for every job created by logging, these days there are five or six jobs created by tourism. Senator Murphy is quite right. Tourism is the future for Tasmania, along with the high quality design goods produced for export coming out of our state. To give the incentive to the old, dirty, polluting, destructive industries like this in this country is quite wrong.Moreover, aside from that, the rising clean, green industries even in the energy sector are going to be put at a comparative disadvantage and you are going to kill a goodly number of those as well. These are things like solar power, wind power and alternative energy in general. If this government had been giving that $3 billion to those industries, they would be producing tens of thousands, if not hundreds of thousands, of jobs within a decade and they would be setting up Australia as the export centre for clean, green energy alternatives to Asia and the rest of the world, much the same as the Danes have been able to achieve through giving special government assistance to the wind energy business in that little country back in the early 1980s. It has been a winner for them right around the world. But not this government. It is not even in the business of not helping. It is in the business of killing these important industries for our future.That brings me back again to my original request for information from the government as to what will be the comparative advantage or disadvantage for Tasmanians. I am talking here not about the half-dozen chief executive officers who float across Bass Strait occasionally to see how the business is going and then go back to headquarters, but the nearly half a million Tasmanians who are amongst the lowest income earners in the country and who have one of the highest unemployment rates. Helping make up for that, of course, is one of the most magnificent living environments in the world, but we are here talking about the material side of life. I wonder what the government's comparative analysis of the impact of the GST for or against the interests of three per cent of Australians living south of Bass Strait is against those who live on the mainland?10000TEMPORARY CHAIRMANThe TEMPORARY CHAIRMAN (Senator Ferguson)—Order! Before I call the next senator, it has been brought to my attention that the bills relating to Commonwealth-state relations and the bills relating to the wine equalisation tax and the luxury car tax are not before this committee. They are not due for debate in the committee stage until 30 April. I was remiss in not pulling up some senators prior to this because I needed to be reminded of that fact. I ask senators to bear that in mind when they are making their contribution at this committee stage on the other 16 bills we are considering.21:08:004367Murphy, Sen ShayneSenator MURPHYFX5TASALP00—The questions that I was asking about the wine equalisation tax concern the extra $147 million that the Commonwealth will collect. As it stands, the wholesale sales tax as it is applied to wine is a result of the 26 per cent Commonwealth tax and a collection of 15 per cent on behalf of the states as a result of a High Court decision, which was a state surcharge or licence fee or however it was applied in the states.The wine industry will now be taxed a further $147 million. It is a question of whether the government plans to make any adjustment with regard to transferring that money back to the states to allow them to rebate the wine industry. That is one question. Somehow the Assistant Treasurer seems to think that the wine industry thinks it is all okay. It clearly does not. A news release of 23 April states:Six of Australia's most prominent wine makers today launched a national protest against the increased wine tax proposed by the Federal Government, saying that it threatened wine exports, jobs and rural income.It says, amongst other things:Top Barossa wine maker Peter Lehmann said an unexpected tax hike of $147 million a year made a mockery of Prime Minister's Howard promise that wine prices would remain stable with the introduction of the GST.I have not heard the Assistant Treasurer say that it is not $147 million. If it is $147 million, I have not heard any statements about whether that money will be paid back to the states so that they can in turn rebate the industry and there is a nil effect. As I understood it, it was initially announced that the WET would be revenue neutral. If it is to be revenue neutral, people say that, instead of being levied at 29 per cent, it ought to be levied at 24½ per cent.10000TEMPORARY CHAIRMANThe TEMPORARY CHAIRMAN—Senator Murphy, you are now talking about the bill in particular. Your previous remarks were more general, but you are now dealing specifically with the wine equalisation tax.FX5Murphy, Sen ShayneSenator MURPHY—But we are dealing with the effect on the states. The effect on the states goes to the question of the economic impact. The economic impact comes by way of potential job losses et cetera. I am asking the Assistant Treasurer whether they have any plans to do anything about that.I also asked a question about the GST on the tourism industry and its impact on the states, particularly on my state. I understood the Assistant Treasurer to have said—I thought he repeated it, although differently—that the GST the government is proposing to introduce brings into line this country's tourism industry with those in other countries. I asked him whether other countries that have a GST and—I think he said this—a thriving tourism industry have a concessional system where people are either not paying a GST or are paying it at a very concessional rate. The Assistant Treasurer outlined some issues that went to matters affecting inbound tourists. They will, of course, not pay a GST on international or domestic airfares that are purchased overseas or on continuous domestic flights. They will also get a GST rebate for goods purchased within the country on departing the country.I ask the Assistant Treasurer about the impact on national tourists; that is, people going interstate et cetera. They form a fairly significant part of any tourist industry in any state. The GST will not be rebatable to those people. That is the fundamental question. I ask the Assistant Treasurer about his claim regarding the thriving tourist industries in these countries that have a GST. Is it not the case that they have either concessional or rebated systems? People are sometimes not paying a GST or are paying a much lesser rate of a GST, VAT or whatever the case may be. I would be interested to hear some comments on that.21:14:004368Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—We have had a discussion about Commonwealth-state financial relations. That bill is not in this package of bills which are before this chamber. Equally, the bills relating to the wine tax are not before this chamber. We can have debates on those bills. However, it makes sense to wait until the bills come before this chamber so that we can have these debates. Knowing his enthusiasm for these things, Senator Murphy will be jumping up and down as soon as these other bills come in, and we will have the same debate. It makes sense that we do not debate bills which are not before the chamber. I am again mindful of Senator Sherry's comments that we are very anxious to get these bills debated. The sooner these bills go through, the sooner we can get the other bills in and we can have a debate on them.A number of issues were raised by Senator Brown from Tasmania. The payroll tax does not change, Senator Brown. That was one of the issues you raised. A wide range of taxes—up to nine—will be removed. That is on the public record. The states were very keen to abolish a range of inefficient taxes.QD4BROWNSenator Brown—Does that include stamp taxes?WW4Kemp, Sen RodSenator KEMP—There is a range here. I can go through these for you if you like. They include financial institutions duty, debits tax, 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 so forth. So a range of inefficient taxes will be coming off—and I think the states welcome that. That is part of the agreement with the states.How will the tax reform affect Tasmania? Senator, our reforms to the tax system will provide Tasmania, like other states, with a more robust source of revenue which can be expected to grow over time. I note your comments about Premier Bacon. I think Premier Bacon was probably being sincere when he welcomed the arrangements. I do not think he was being indiscreet; I would prefer to phrase it that he was being honest. If he welcomed the arrangements, which we think were very generous, we think he was quite right. The revenue will allow the Tasmanian government to remove a range of inefficient taxes and provide into the future a sustainable level of quality services, such as hospitals, schools, roads and law enforcement. We think that is a very good thing, and it is one of the reasons we think this is quite a historic reform.The Commonwealth has guaranteed that in the three years following the GST the budgetary position of Tasmania will be no worse off than it would have been in the absence of tax reform. There is a wide variety of ways the Tasmanian economy will benefit from the tax system. The cost of transporting goods and passengers across Bass Strait will be reduced by the effective elimination of the tax on marine fuel. You spoke about tourism in Tasmania. That seems to me to be a very important initiative not mentioned by anyone in this chamber. The net excise on diesel fuel used in heavy transport and rail will also fall sharply. You do not agree with that issue, but rural and regional Australia does. It is one of the big pluses for rural and regional Australia. Tourism operators will benefit from lower transport costs. Tourism operators in remote areas will obtain relief from excise for off-road use of diesel, such as remote air power generation. There are quite a range of ways in which the economy in Tasmania will benefit.In relation to tourism, I will quote from a letter written by Tourism Council Australia. We have had a lot of experts on tourism in this chamber. Despite their interest in the debate, they all appear to have now departed, having made their comments.8O6O'BRIENSenator O'Brien—Would you like me to call them back?WW4Kemp, Sen RodSenator KEMP—You can call them back. They asked questions. One would have hoped they would have stuck around to hear a few answers.FX5MURPHYSenator Murphy—They are enthralling speeches that you make.WW4Kemp, Sen RodSenator KEMP—You asked me about tourism. I am now quoting to you from Tourism Council Australia. Senator Murphy, you might not accept Tourism Council Australia's views, but let me just put them on the record. This is from a letter that was written to the Treasurer, with a copy sent to the Hon. Jackie Kelly:I am writing to you to clarify the tourism industry's position on tax reform. I understand that over the last month the industry's message has been confused and been subjected to contrary statements on the effect of a GST.Tourism Council Australia is a foundation member of the Business Coalition for Tax Reform and intends to work with Australia's leading business organisations in supporting the tax reform agenda.Listening to all the senators who are great experts on tourism, I noted that nobody actually bothered to quote Tourism Council Australia. The letter continues:TCA has 30,000 members Australia-wide and is the peak national body representing the interests of the tourism industry. This industry is solidly behind the Government's taxation reform package.7Y6CROSSINSenator Crossin—What did they say in their submission?WW4Kemp, Sen RodSenator KEMP—I know this is distressing for you, but you have had all these experts standing up and saying, `Gosh, this is so bad for tourism'; it is funny that Tourism Council Australia does not agree.FX5MURPHYSenator Murphy—What is the date?WW4Kemp, Sen RodSenator KEMP—Senator Murphy, because of the expertise you have shown in this area this evening you should go and explain to Tourism Council Australia that in your view they happen to be wrong. In my view they happen to be right.FX5MURPHYSenator Murphy—What is the date on the letter?WW4Kemp, Sen RodSenator KEMP—The 2nd of March, 1999. The letter goes on:With the objective of achieving industry unity, I have attached a letter to Chris Brown, Chief Executive, Tourism Taskforce from the tourism industry's major associations.I hope that this clarifies the industry position on taxation reform.All I put on the record is that Tourism Council Australia seems to totally reject the views put forward by the Senator Murphys, the Senator Browns, the Senator Quirkes, the Senator Hoggs and the Senator Sherrys of this world. All I can say is, `Why don't you consult with the industry associations? Listen to what they say.'21:21:004369Conroy, Sen StephenSenator CONROY3L6VICALP00—I rise to pose a number of questions to Senator Kemp in relation to the bills before us today. They strike at the questions of equity in this package and they come to some of the fundamental assumptions that have underpinned the government's package. They are questions about why the government has gone down the path it has.The government has moved 128 amendments to its own legislation after, it says, extensive consultation with a wide variety of people. Who do they include? They include its accountant mates, its tourism mates, its big business mates and a whole range of organisations that could be characterised by the president of Senator Kemp's football club, Mr John Elliott—the big end of town. I am embarrassed by him, and I am sure you would be embarrassed, Senator Kemp—especially by your football team's performance.10000TEMPORARY CHAIRMANThe TEMPORARY CHAIRMAN (Senator Ferguson)—Senator Conroy, please address your remarks through the chair.3L6Conroy, Sen StephenSenator CONROY—Through you, Mr Temporary Chairman, the question is: where are the amendments about the pensioners? Where are the amendments to try and fix what has been exposed in the Senate inquiry about the fairness of this package and about the assumptions that you have used that have been exposed as dodgy? And that is being kind. From the first hearing on Thursday, 17 December last year there has been a systematic destruction of the assumptions underpinning your package.The core element of your package is its inflation assumption. It is an inflation assumption based on the premise that Jamie Packer spends the same percentage of his income on the same amount of items as a pensioner—that they have the same expenditure patterns. The government has systematically defended this key assumption. You have to defend it today, Senator Kemp. You have to explain to us—10000TEMPORARY CHAIRMANThe TEMPORARY CHAIRMAN—Order, Senator Conroy!3L6Conroy, Sen StephenSenator CONROY—Sorry, through you—10000TEMPORARY CHAIRMANThe TEMPORARY CHAIRMAN—Not through me, to me.3L6Conroy, Sen StephenSenator CONROY—Today, in this chamber, Senator Kemp and the government have to defend that assumption. When you hear the sweeping generalisations that Treasury, the government and Senator Kemp have made, you have to question what the elements of this package are. On day one, we started with Professor Warren. He was asked, as the Prime Minister's preferred micro-economic tax reform modeller on indirect taxation, what he thought of the government's assumption that everybody has the same expenditure pattern. That means that everyone in the gallery and everyone in this chamber has the same expenditure pattern, including Senator Heffernan.What did Professor Warren say on 17 December? I have a number of quotes. Senator Heffernan is in charge of a piece of legislation for the first time, I think—a very onerous responsibility—and I look forward to his answers to these questions. When Professor Warren was asked what he thought of the Treasury's and the government's assumptions about the CPI data and the HES data—the household expenditure survey data—he said:I will tell you the answer to that. If you take the 1985 and 1992 papers, while we all accept that there are genuine real problems with the household expenditure survey—and none of us is denying that—the difficulty is what you do if you do not believe HES. HES is the critical data source for all the people who essentially work. It is used by the Department of Social Security. It is used by ABS. It is used by all researchers because there is simply no alternative to HES. All of us know its problems and its limitations. What is different about what the Treasury have done this time is the way they have responded to the dislike for HES. This time they completely ignored it.This is the question for Senator Heffernan, Senator Hill or whoever is going to answer. Senator Kemp is now back, so he can answer. Professor Warren went on to say:This time they have completely ignored it. The clearest sort of explanation of the Treasury position is actually in the draft white paper in chapter 22, table 22A1—something like that.He continues:I think it is critical that, if you are going to criticise HES, like any criticism, you have to offer an alternative. My view is: if I accept a criticism, what is my positive response? In 1985 and 1992, they effectively imposed saving ratios which they got some insight from via HES. I suppose that is what is different this time—this time they imposed a different set of savings ratios and responses to different expenditure patterns from what they did in 1992 and 1985.He goes on to say that David Johnson—who was appearing before us the next day—and himself, and every other reputable expert in this field, had said that what the Treasury did was dodgy. We acknowledged that on the Senate committee. We commissioned our own modelling. That modelling has been controversial. There has been a lot of debate about that modelling, as Senator Ferguson would acknowledge.We were in a position to do something that the Treasury should have done. When the representatives of St Vincent de Paul appeared before our committee, they asked, `Why couldn't the Treasury make an effort, with all of the resources available, to actually go out and model the impact of these tax packages on real Australians?'3M6MURRAYSenator Murray—Especially older Australians.3L6Conroy, Sen StephenSenator CONROY—Especially older Australians, Senator Murray. Why wouldn't they do some modelling on this? They asked us to do some modelling.7Y6CROSSINSenator Crossin—They couldn't find them.3L6Conroy, Sen StephenSenator CONROY—That is right, Senator Crossin. The Treasury documents say that they could not find 35 households in the lowest income group.FX5MURPHYSenator Murphy—You could have found them in one small suburb in Tassie.3L6Conroy, Sen StephenSenator CONROY—You probably could have, Senator Murphy. It would not have been hard for Treasury to actually make the effort and provide the critical evidence to justify its assumptions. I am hoping to hear that tonight from Senator Kemp. I am not holding my breath, but I am hoping to hear it. Professor Warren went on to say:My concern is that there are differences in the consumption bundle between groups of individuals, and those differences do need to be taken account of. The Treasury themselves have reflected the different impacts that those consumption models have on the price effects for those different households. In their previous analysis they took that into account and in the material that Treasury have subsequently released have indicated how those price indexes vary around the 1.8 and 1.9 per cent average. It is just the different consumption bundles.So Treasury actually do acknowledge something, which is a big step for Treasury, that in the real world, with real people, real people have different expenditure patterns. But they actually do not want to model a package on it. That is where the real crime in this debate is, because this government have not been fair dinkum. This government went to the Australian people last year and talked about averages. The Prime Minister still talks about averages today. He says, `We can't find any average group that is worse off.' No real individuals but the averages. What we say is, what happened to the real individuals? Professor Warren said:The consumer price index applies to wage and salary earners in major capital cities and the bottom 90 per cent of those people. That is not a pensioner or a welfare recipient. It is not somebody in the country. It is not somebody who is self-employed. Therefore, within the weights you are using in the calculations, you would like to see the experience of somebody else who is not a wage and salary earner in a major metropolitan area. That is why there is real danger—I emphasise the words `real danger'—it is similar danger to using the CPI to index a pension; it is not necessarily the appropriate index, because it relates to a different group of individuals. Our difficulty is that if you are interested in the experience of a particular individual then you must make it consumption bundle specific. The CPI does not necessarily belong to a pensioner. And that is why we want to use something other than the CPI, which is the index for a particular consumption bundle which is not necessarily everybody that we want to examine in this analysis.When you are dealing with people at the bottom end of the scale, when you have made the promise that no Australian will be worse off, you have got to be able to live up to the rhetoric. You have got to be able to say what happens at the bottom end to the people who are going to be potentially the worst affected. What you have got to be able to show categorically is that everyone is going to be, at worst, no worse off. Hopefully, you would like to be able to say that they are better off under this tax reform.Even after the Senate commissioned its own modelling, the government trumpeted it in the morning. They stood there in the morning at the committee going, `This is a beautiful set of numbers.' What did that beautiful set of numbers show? Pensioners 37c better off, the average pensioner 37c better off—but it was a beautiful set of numbers. That is what they told the committee. That is what they boasted. That is what the Treasurer went on radio and television that day and said: `It is a beautiful set of numbers.' These pensioners are 37c better off, and that is only your average pensioner, of course. It was not a real pensioner, it was your average pensioner. So the critical question which will come back to you, Senator Kemp, time and again tonight and in the next few days—ZS6QUIRKESenator Quirke—That is only if he does not smoke.3L6Conroy, Sen StephenSenator CONROY—I will come to the other dodgies along the way, Senator Quirke; don't you worry about that. I will come back to that issue. What Professor Warren went on to say was that the unemployed quite often have quite high levels of expenditure and very interesting expenditure patterns. They are high consumers of the sins of life, as Professor Warren refers to them, as Senator Quirke mentioned. What about the smokers? One of the travesties that this government has perpetrated on people in this debate is that they have said that they accept that there is going to be an increase in the price of cigarettes and they accept—I challenge Senator Kemp to tell us that this is not the case—that there is, on all the expert evidence, a concentration of smokers in the lower income brackets; an overwhelming concentration, the experts say. So, if you are a low income earner, a pensioner, someone in this bracket, and you walk into the supermarket or the tobacconist after 1 July 2000, you are going to find that the price of cigarettes has gone up.4L6EGGLESTONSenator Eggleston—That is right.3L6Conroy, Sen StephenSenator CONROY—That is right; gone up under this package. What the government is saying to you is, `Nobody is going to be worse off unless you smoke, because we aren't going to allow you to be compensated for it.' That is an absolutely deliberate decision. They have said that they are not going to allow people to be compensated for this issue.4L6EGGLESTONSenator Eggleston—It causes cancer.3L6Conroy, Sen StephenSenator CONROY—Presumably there is some rhyme or reason—that is what we are here today to find out about—to what Senator Kemp and the government have done.4L6EGGLESTONSenator Eggleston—It causes emphysema. It causes bladder cancer.3L6Conroy, Sen StephenSenator CONROY—What they have got to say is that they suddenly undertook some new studies and they found that the optimal level of the Pigouvian taxes, which we debated at length at the committee, was suddenly lower than they thought and we needed to put taxes up to balance the externalities of smoking, because that is the argument that Senator Eggleston is shouting across the chamber about. Presumably this government has found the optimal level of Pigouvian tax for cigarette smokers and presumably it commissioned a study—it would be the only one it commissioned from Treasury—that actually showed that all of a sudden we were below the optimal level of Pigouvian tax for smokers and we had to put it up. That can be the only justification for saying, `We accept that in the real world you walk into a tobacconist and the price of your smokes has gone up, but we don't care.' That can be the only justification. (Time expired)21:36:004372Cooney, Sen BarneySenator COONEYSF4VICALP00—Leading on from what Senator Conroy had to say, I have some questions about the way the bill itself is set out. If you look at A New Tax System (Goods and Services Tax) Bill 1998 and you look at what is taxable, you see that what is taxed is supplies. You then find set out what taxable supplies are, and the bill goes on to set out what the meaning of `supply' is.It starts off with a very simple concept—`A supply is any form of supply whatsoever.' It goes on to say that `without limiting that concept the following applies'. Then, having said that a taxable supply is a supply that you make for consideration—and people understand what that is, that you have to give some money or some services in exchange for the supply to make it taxable—the bill goes on to talk about supplies without consideration in 72-5. When you look at this bill and at what a taxable supply is, you see a lot of asterisks against a whole number of words such as consideration, enterprises that you carry on, that the supply is connected with Australia and so on.What I want to ask is this: if you wanted this bill to be simple, why didn't you simply persist with 9-10(1)—`A supply is any form of supply whatsoever'—and a taxable supply `is a supply that meets these criteria' and then let it run at that rate. The concept is that you tax supply, whether it is a supply of goods or a supply of services. Why does the government want to complicate the whole of this concept of a tax on goods and services by going through a whole range of definitions which, I would suggest, lend themselves to a lot of protracted bouts of litigation over a number of years and at very great cost?The proposition that the government puts forward—that is, that this is a simple concept and that this is going to make things clear—is not borne out in its own legislation,. The government says, `If you extract food from the matters that are going to be taxed, that makes things too difficult because then you get down to issues of definition,' but when you look at the bill itself it is just full of definitions one after another. To add another one, such as `food falls into the following definition'—and food is thereby defined—simply adds to the whole range of definitions that you have sewn into the act.You really do have to go from, say, subdivision 9A over to a definition section which then sends you back to another part of the bill and so on. So the whole bill is a very complicated one and full of asterisks. If you go through it, you see asterisks on most pages and all those asterisks mean that you have to go to a dictionary which is set out at the back to find what it all means. This is a bill that is a paradise for lawyers and a terrible hardship for the courts, particularly the High Court.21:41:004373Conroy, Sen StephenSenator CONROY3L6VICALP00—I want to return to Professor Warren briefly for one moment to continue my earlier comments. During the hearing when he was testifying before us, I asked him about the Treasury analysis. I asked him about the paper referred by Dr Michael Carnahan, which was on the theoretical underpinning. I hope you are familiar with that, Dr Kemp—sorry, Senator Kemp; I snuck your brother in there—or are able to get advice on it at least.WW4KEMPSenator Kemp—It is a compliment.3L6Conroy, Sen StephenSenator CONROY—Only to you! Professor Warren was asked to comment about that document and said:Like others, I was looking for the supporting literature, and why there was a significant change in position from 1992 and 1985. It was not forthcoming from that, other than inferred by the title. I did not feel convinced at the end of it. I read the literature and it seemed to me that the precedent was not in the direction where it was leading—so I had some difficulty with that document.So there is the first significant criticism of the government's position from Professor Warren, but the next day Dr Johnson was even more caustic. I would like to briefly turn to a couple of excerpts from Dr Johnson's evidence on this issue because it is very telling about the government's position, Senator Kemp, and you will be asked to justify why the government took this step. Dr Johnson states in evidence:I felt that the Treasury costings underestimated the effects of the price changes on households in the medium term for a number of reasons. They did two things: they underestimated the effects on households in general and they had the effect of changing the relativity between the effect on low income people and high income people and different demographic types. The reasons for the undercosting and the change in relativity were to do with the fact, first of all, that their measure of the overall price change was less than we found it to be.that is, their own modelling—Secondly, they assumed the same spending pattern for all households, which I do not think is valid. Thirdly, they assumed that there would be no saving or dissaving amongst households. The first two I think are just plain wrong.Now this is one of the country's foremost economic modellers in this area. He goes on to say:To assume that everyone has the same expenditure pattern is contrary to almost all known evidence anywhere on this subject. So that seems to be a very, very much stronger assumption than the assumption that we use patterns of expenditure which we know are flawed and we know have difficulties but are still not nearly as strong an assumption. Surely, if you want to get the best result you can, then that is the way to go.We can then go and look at the particular problems with why the expenditure pattern results might not be good and we can look at the issue of underreporting and durables—and they are the two main ones that the Treasury is concerned about.I am hoping to hear about durables from Senator Kemp. He continues:What I would say—and I guess what I have claimed—is that the Treasury ought to be able to make a better estimate than they have. Not that what they have done is manifestly wrong. It may be wrong to just take the expenditure patterns from the HES, although I am sure they are better than the assumption of common expenditure patterns. But there is a better way and in fact the Treasury documents have indicated what that is. There is a paper written by Wright and Dolan in 1992 which shows how you ought to be able to handle the question of underreporting. On the question of durables, what we are talking about here is the possibility of error within particular samples. We know that the thing is roughly right over the whole household expenditure survey of 8,000-odd households. The question is: how far down, how disaggregated, can you go before you reckon that the errors are too great to report a result? I have published results which show for 35 cells, with roughly a couple of hundred people in each, that the results will support that sort of disaggregation.. . . . . . . . .This is what I think should have been done. That is an exercise that requires time and effort.This government spent $20 million in glossy advertising for its product, but it could not go out and find 35 cells, or a couple of hundred people, down at one end of the income scale to model and test its assumptions. It spent $20 million to give the Australian public a snow job, but it could not be bothered to do that. This was followed up at the next hearing, on Thursday, 28 January. The criticism just did not stop with two; every witness who appeared before the committee who was experienced in this field made this same criticism. It is a dodgy assumption. They criticised the Treasury paper. They criticised the government, and they all asked the question: why would you do this? We are hoping today to hear from you, Senator Kemp, about this.Professor Harding, another of the Prime Minister's preferred modellers on tax reform, touted that day a beautiful set of numbers. She helped produce them. And what did she say? She said the same thing. I will not go to the quotes, because they are lengthy, but she went to the same point. Over and over again, everybody who appeared before the committee seriously questioned the Treasury on it—that it was fatally flawed to take this approach. You have to justify it, Senator Kemp.There was a tight deadline that this government demanded on the reporting. People had six to eight weeks over Christmas from when the Senate set up the committee to when submissions closed, and that was right through Christmas. Two organisations, in particular, put the lie to this Treasury assumption. The first, as I mentioned earlier, was St Vincent de Paul. The second is an organisation that is called ARPA Over Fifties Association Ltd. Both of those, with their limited volunteer resources, sought to put the lie to the Treasury analysis—the mighty Treasury; the $20 million in advertising expenditure before the last election.These tiny little organisations of volunteers—charities—with just anyone that they could cobble together actually went out and looked for some people in the lower income brackets. They actually went and talked to some pensioners. They went and talked to some self-funded retirees. They went and talked to some people who were unemployed. They tried to get some information. And what did St Vincent's have to say about the Treasury assumption? St Vincent de Paul before the committee on Thursday, 28 January stated:The expenditure pattern of low income earners is vastly different from that of the wealthy. Low income people spend all of their money on essentials; the poor have no discretionary income. In short, the wealthy have options; the poor have none.It might seem to you that this is a perfectly commonsense position, but it is too commonsense for the Australian Treasury, too commonsense for the Australian government and too commonsense for $20 million worth of advertising. They used our money to mislead us in the extreme, just like they mislead us on their health rebate, which was exposed in the last few days. St Vincent de Paul went on to say about the package:It is in, in our view, a clear transfer of wealth from the poor to the rich.That was St Vincent de Paul. They continued:In contrast to the spending pattern of the wealthy, low income people spend around 27 per cent of their income of food, 34 per cent on other essentials of life and 30 per cent on housing. This means that over 60 per cent of their income will attract a full 10 per cent GST. On 30 per cent, there will be a further five per cent increase.They go on to state that the figures make it clear to them that if it were decided as a compromise to exempt food from a GST that still would not be enough, and I say that to the Democrats in particular. I will now quote from their submission some of the figures from their survey—albeit a small one which was criticised by some members of the government because it was a small sample. It showed that with an income between $0 and $324 a week people spent 30 per cent on food, three per cent on clothing, 11 per cent on utilities, seven per cent on transport and 32 per cent on housing. People with a weekly income of $325 to $548—just moving up a little—spent 29 per cent on food, three per cent on clothing, nine per cent on utilities, nine per cent on transport and 28 per cent on housing. So the point they were making is that if you have a CPI figure which is not representative of people in this category you could not possibly be measuring the real world effects on these people. They state:- The CPI is artificially low and contains several major deflators which are not relevant to low income earners. These deflators obfuscate the significant cost increases in essentials such as food in general and fresh vegetables and fruit in particular over the last twelve months.They say:It is simply wrong to take an average across the community and assume that compensation based on such an average is satisfactory. By definition averages are averages and, equally by definition, almost no one is average. To put it more bluntly, a CPI benefit from a cut to tax on a new high definition $3,000 TV is of not much interest to a family hit with GST on its electricity, gas and food bills.That is the nub of the argument when it comes to why Senator Kemp has to give this parliament and this chamber an explanation. They go on to say:. the impression given by many Government spokespersons that Wholesale Sales Tax (WST) applies to all its items, including food and vegetables and clothing; whereas it affects very little of what low income earners purchase. Any indirect effect will be more than compensated by natural price increases; low income earners have no discretionary income and are often dissavers . . .And they go on talking about examples. They said that some examples of ABS statistics for the year ending September 1998 were fresh vegetables up 26 per cent in price, food generally up 3.2 per cent, rents up three per cent and household supplies up 2.2 per cent. But the overall CPI figure—and this is the trick in statistics—is held down by items which are of no consequence to the poor. The price of new cars will come down. Pensioners are going to run out and buy a new car because the price of a new car has come down. The price of petrol will be down 4.5 per cent and the price of audiovisual computer equipment will be down 4.9 per cent. You can just see it: pensioners and people on low incomes are just going to run out and buy all those big consumer durables. Senator Kemp wants to stand before us tonight and tell us that it is okay to CPI average across everybody and that it is okay for the Treasury to have done this. St Vincent's submission goes on to state:Further modelling will be questionable if it did not factor in the special position of the poor—over 30% of Australians.These families will not enjoy the forecast reductions in prices due to the removal of the wholesale sales tax on a number of items including so called luxury items like new motor cars, electronic equipment, jewellery etc. Therefore, any modelling based on the essential needs of low income families must reveal that without these offsetting reductions, the addition of a 10% consumption tax to the already increasing costs of their essential needs, will add well in excess of 1.9% to their cost of living and place in doubt the adequacy of the compensation offered to these families. Indeed there is a strong case for these essential needs to be exempted from a GST.According to St Vincent de Paul, much more than just food needs to be exempted for this to be a fair package. If you think that the St Vincent de Paul Society was the only organisation that was able to get together a survey in time to make a submission—Treasury still could not do it but St Vinnies had a go—the other association I mentioned a little earlier also went away and had a look at the percentage that low income earners which they surveyed were able to spend on different areas. Funnily enough, the same sorts of percentages of how much a low income earner spent on the items that I described before start to come out: 25 per cent on miscellaneous services, 31 per cent on food and eating, and 16 per cent on utilities. Again and again and again, in the categories that were able to be pulled together in the short time frame that this government imposed on the debate, they came up with the same figures. They all shout loudly that it is wrong. St Vinnies probably summed it up the best when they said:We would consider that the proposal as we see it—with the evident transfer of wealth from the poor to the rich, which registers a growing gap between the rich and the poor and the haves and the have nots of this country, and the imposition on the necessities of life which make low income earners worse off than they are now and, indeed threatens to put middle income earners into an equally difficult lifestyle—undermines our egalitarian nature which has underpinned the social fabric of this country. In that view it is unAustralian.This package is un-Australian. It is un-Australian because the core assumption that this government has made is to say that everybody in this community, everybody in this chamber and everybody in this gallery have the same expenditure pattern—and you have to answer for that, Senator Kemp. (Time expired)21:56:004376Gibbs, Sen BrendaSenator GIBBS6L6QLDALP00—I also would like to talk about equity and the impact of this legislation on a number of important sectors in the Australian community. Firstly, I would like to draw the minister's attention to the implications of a GST for women in the community. A significant amount of evidence provided to the Senate Community Affairs References Committee inquiry, which I participated in, indicated that many women would be much worse off under a GST. The Women's Economic Think Tank highlighted the negative implications of a GST for women who have traditionally been among the low income earners of the Australian work force. WETTank stated in their submission:As women are the low income earners and the managers of household finances, the gender issue is that many more women will be unfairly taxed than men.Professor Patricia Apps of the University of Sydney concurred with this view. She also presented evidence to the committee that the government's shift to a `joint tax' system would be highly detrimental to women. The government's tax package shifts the taxation burden from single to dual income families. Since the female partner is typically on lower pay, the burden of taxation will be greatly increased for her as the second earner.The GST package is inequitable in the way it discriminates against dual income households. These families will face declining standards of living and are not able to benefit from the untaxed home production of the partner that stays at home full time. As the taxation burden increases, many such families will be forced to re-evaluate the benefits of the second earner staying in the work force. Women already on low incomes may decide that their time would be better spent at home.The submission of the Young Women's Christian Association backed up Professor Apps's observations, highlighting the inequity of the GST's treatment of families on similar incomes. Their evidence presented a case study of two families, both with two children, one under five years and one already at school. Both families earned $45,000 a year, but one family had a part-time worker and a full-time worker while the other had only one full-time worker.In the second family with a single full-time worker, the full-time parent already receives almost $41 as a parenting allowance because she has little or no other income. Her family gains about $39 under the new tax regime. In the first family, one adult earns $30,000 and the other earns around $15,000, making the total equivalent to that of the second family. However, family 1 also has to consider a number of additional expenses, such as $60 per week gap fees for three days of child care, extra travel costs and other additional work related expenses. This family, however, ends up with only an extra $15 per week.Professor Apps concluded that the GST's negative impact on women would have other serious implications for the economy and the wider community. If the number of women in the work force declines, the future tax base for funding the age pension will be further diminished. In addition, Professor Apps pointed to evidence suggesting that a fall in the female participation rate would result in a massive decline in levels of household savings.Sole parents will also be hit hard by the GST. The Sole Parents Union has expressed great concern about the implications of the GST for sole parents. The union claims that some 88 per cent of sole parent beneficiaries are women, while the sector contains some of the most disadvantaged households in the community. Increases in the cost of living for these people, stemming from a GST on fresh food, clothing and other essentials, will make it even harder for such families to make ends meet.The Sole Parents Union also demonstrated how the GST would create a poverty trap for sole parents by limiting the accessibility of child-care services. Increasing costs would limit a sole parent's capacity to remain in the work force in many instances. The declining accessibility of child-care services would create a significant disincentive for sole parents to take up or maintain paid work. This situation will increase pressure on the social security system while reinforcing and intensifying existing poverty traps in the long term. Such a situation would be detrimental both to the families involved and to the Australian economy.While the GST will clearly have negative implications for many women within the Australian community, people with disabilities will also be dramatically disadvantaged by the government's tax package. The Physical Disability Council of New South Wales has disputed Treasury calculations of the CPI effect of the GST on people with disabilities. While Treasury calculations estimate the effect to be 1.9 per cent to 2.2 per cent, the council told the Community Affairs References Committee that the actual effect could be as high as 2.4 per cent to 2.7 per cent. The organisation's submission concluded:Many people with physical disabilities will be absolutely worse off as a result of the GST package, even after accounting for tax compensation measures, and even after accounting for the concessions which have been made to people with disabilities in the tax package.The inherently regressive nature of the GST can be clearly demonstrated in the context of the effects on people with disabilities. While a single person on $75,000 will be $68.55 a week in front as a result of the GST, this amount is equivalent to 38 per cent of the total weekly disability support pension. Disability support pensioners, on the other hand, will receive an increase of only $2.54 per week.Treasury calculations have severely underestimated the potential implications of a GST for people with disabilities, who spend a significant amount of their incomes on basic services that enable them to maintain their independence and a decent standard of living. Treasury compensation calculations are based on the anticipated rise in the CPI, which reflects the spending patterns of the community as a whole. However, patterns of expendi ture are more often a reflection of a person's income level. People with disabilities are generally on fixed and low incomes. The majority of their income is spent providing for the necessities of life, which are not directly taxed at present. Because of the unique needs and requirements of people with various disabilities, the CPI does not accurately reflect their patterns of consumption. These people have needs for goods and services that are vastly different from other members of the general community; therefore, any compensatory measures need to address and reflect the expenditure requirements of people with disabilities specifically.Carers of people with disabilities will also be penalised under the government's tax package. In evidence provided to the Senate inquiry, the Carers Association pointed out that carers and their families are already spending an enormous 26 per cent of their disposable household income on health and community care and disability related costs. In addition, carers are already among the poorest people in our community, with over half of full-time carers on incomes of less than $200 a week. Two-thirds pay under $20 per week in personal income tax, so the proposed cuts to personal income tax offer little hope for carers.The Carers Association believes that the GST will have a disastrous effect on carers. The association's financial analysis concluded that the GST would reduce the spending power of carers by more than four per cent on average. For larger families, with higher consumption of food, clothing and other basic consumables and services which are currently tax free, the figure would be significantly higher. Clearly, people with disabilities and their carers constitute one of the most disadvantaged groups in our society. The highly regressive GST will only intensify their struggle and institutionalise their marginalised position within the Australian community and economy.An analysis of the coalition's 1991 Fightback package provides some interesting comparisons with the government's GST in its current form. Since 1991 the coalition has moved away from some of the assurances that underpinned its tax reform package at the time. While the GST was to be set at 15 per cent under the Fightback package, the coalition promised that the rate would not be increased beyond 15 per cent and that guarantee was supposed to be embodied in legislation. The current tax package contains no such guarantees. In addition, under Fightback all pensions were to be increased by eight per cent and other social security payments by six per cent. These compensatory measures would make the current GST package slightly more feasible.During the recent committee inquiry, ACOSS also referred to the proposal in Fightback to introduce a special disability allowance to help people with disabilities with the extra costs they face in operating within the mainstream community and workplaces. The community affairs committee felt an enhanced compensation package such as this would help cover the expenditure requirements of people with disabilities while reducing barriers to their full participation in the work force and society.In March 1993 the Australian community resoundingly rejected the Fightback package and a regressive GST by re-electing the Keating Labor government. In May 1995 Mr Howard said that a GST was no longer coalition policy. However, all we have before us today is a reworked version of Fightback. The GST rate may be 10 per cent rather than 15 per cent this time around, but there are no guarantees that it will stay at 10 per cent, and vital compensatory measures have also been stripped away in the interim.I ask whether the minister can guarantee that women, sole parents and people with disabilities and their carers will not be worse off under the government's GST tax package. In addition, can he make any attempt to refute the facts presented to the Senate inquiry by organisations representing the interests of these particularly disadvantaged sectors within the Australian community. Most of all, can the minister guarantee that the GST, if this bill is passed, will stay at 10 per cent and will not rise next year, the year after or any other year; can he guarantee that the GST will definitely stay at 10 per cent now and forever after?(Quorum formed)22:10:004378Crowley, Sen RosemarySenator CROWLEYZF4SAALP00—I have a couple of questions for you, Minister. I have a list here of organisations—and I should now make sure that I provide you a copy of the list—offered Treasury briefings by government senators during the Senate Community Affairs References Committee public hearings into the GST and a new tax system. I will read them out, but I would like to know: did such briefings occur and what were the outcomes of those briefings? The organisations are: the Association of Independent Retirees; the Australian Confederation of Child Care; the Australian Pensioners and Superannuants Federation; the Community Housing Federation of Australia; the Consumers Health Forum of Australia Inc.; National Association of Community Based Children's Services; National Youth Coalition; the Older Women's Network Australia Inc.; Returned Services League of Australia (Qld) Branch; Seniors Economic Forum; and the YWCA of Australia. If you like, Minister, I can seek to get a photocopy of that list and provide it to you so you can check that for me.These organisations were offered briefings, in particular to deal with some of the difficulties they raised, and they were pleased to accept the government senators' offers of briefings by Treasury officials. I do think it would be useful for the committee to know whether those briefings occurred. If not, was that because the organisation did not proceed with it or why not? If so, were all the queries that the organisations had satisfactorily answered? I think they are very important because the questions the organisations raised included many areas of considerable difficulty.In answering that, Minister, would you deal with another area of considerable difficulty. Sometimes we were advised that, if an organisation was not clear that the concerns they had were covered by legislation, they were told, `Never mind, the minister has discretion to include extra things in the legislation.' I have said in this place before, and I have certainly heard many of you say: if we have to vote on legislation, it is reasonable to ask that that legislation be available to the senators. We are told to vote on legislation on the following grounds, `Never mind, that will be under the minister's discretion; we can add things to the list; it will be done by regulation; don't worry'—the more you say, `Don't worry,' the more I will and do.Some of the queries raised by these organisations did include whether or not certain things would be in delegated legislation. So I would appreciate it if you could provide a response to that list, first of all. Secondly, Minister, we have a list here of 22 questions or groups of questions that arose out of the public hearings we had in the community affairs references area. Again, I think it would be easier to get a photocopy of the questions raised and ask for your response to them. I have to say that these have been provided, with the relevant part of the Hansard reference, to Treasury and I to this point am not satisfied that we have had any response to this list of questions. If I am wrong, I would be happy to be advised so, Minister.WW4KEMPSenator Kemp—You have had no response?ZF4Crowley, Sen RosemarySenator CROWLEY—Not to these questions that I know of. Some of these would probably be covered by the amendments to the legislation and, at some later time in this debate, I will certainly come to those. But others are of considerable importance and I am advised that they were put to the Treasury by the secretariat of our committee. When I was last speaking to the secretariat I was not informed of any response from Treasury to those questions, so I certainly think it is not unreasonable for us, as we go through this legislation, to have responses to those questions.Minister, perhaps I should get a photocopy of these two pages of questions and provide them to you, and perhaps at a later time in this debate you could provide us with either the responses from Treasury or the responses overall—`This has been included in the amendments,' `This will be dealt with,' and so on. These questions are a kind of modest summary of the major concerns raised by witnesses before our committee and they cover a number of areas, from the health and medical area to housing, child care, charities and remote and indigenous communities.I think at this point I will conclude this contribution. There are other questions I would like to raise, and perhaps I will give you notice of one, Minister. We have seen announced an outline from the ACCC of how it intends to deal with the problem of unfair price rises. The committee and the Senate, to say nothing of the community, would be very much assisted if it had some working idea of what the government thinks—let alone knows—prices will be prior to the introduction of the GST. To what extent do you anticipate prices will change? What will be the impact of the removal of the embedded taxes? If we cannot have some understanding of what the impact of that will be, it is very difficult to understand how on earth anyone could pursue unfair price rises. If you do not know what the fair baseline ought to be, then how can you conclude that prices have risen?I heard my colleague Senator Conroy speaking tonight about the contribution of St Vincent de Paul to our deliberations, and I have to say it was a great assistance to the committee. But one of the things they pointed out was that, if you are looking at how the ACCC might want to behave, it is going to be fairly easy to see whether or not car manufacturers are passing on the reduction in price of a new car. Equally, it will be very difficult to be comforted that the reduction or increase in the price of a bag of potatoes or a packet of cereal will be equally addressed. As St Vincent de Paul said, the ACCC will be concentrating its efforts on major price reductions and major price changes, but it will not reasonably be able to pursue, with anything like the same relentlessness, concerns about the prices of food or small commodity items that thousands of pensioners regularly buy. It is a way in which the difficulty of price surveillance will fall most heavily against those least able, with their 37 cents better-offness, to deal with those price increases.I would like for you to provide to the Senate, Minister, some breakdown of the impact of the embedded taxes on a range of goods. I think the only one the committee was able to discover, by dint of intermittent continuous questioning, was that the impact on a packet of Panadol would be a rise in price of 12c. I would be particularly interested to know what size packet of Panadol would rise by 12c and how that 12c increase was calculated. What was the take-down of embedded taxes, or the reduction in price because of embedded taxes, and what was the overall increase because of the GST on that product? That will be very important in assisting me in my deliberations, particularly about schedule 2, medical provisions. If you could deal with those now or at some later date, Minister, I would be assisted.22:20:004380Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—We have had quite a range of contributions—Senator Crowley, Senator Cooney, Senator Gibbs and Senator Conroy twice. It is probably not surprising that Senator Conroy was called in from the reserve bench, because the earlier contributions tended to cover bills which were not even before this chamber—that is, the wine tax bill and federal-state financial relations. Whereas I think the chair appropriately allowed a degree of latitude in relation to those, I do not propose at this time to respond to issues on bills which are not before the chamber, and I think that the Senate would appreciate that. Equally, I think a lot of the speeches we have heard, and people will judge whether they have made a good contribution or not, were essentially speeches on the second reading—not all, but we have canvassed evidence that was given before the most extensive Senate inquiry in history, and some of that information has been brought forward.Part of the problem is that when we do this—and that is why it is probably better confined to a second reading debate—everyone will naturally quote the evidence which they find more conducive to their case. I do not say there is no room for this in the committee stage of the bill, but the speeches which have taken up most of the evening have been, by and large, second reading debate speeches. For example, Senator Conroy quoted St Vincent De Paul at some length.3L6CONROYSenator Conroy—They have met some poor people, unlike you.WW4Kemp, Sen RodSenator KEMP—I will ignore that silly comment from Senator Conroy. I thought we were trying to have a serious debate here. It is not surprising that Senator Conroy would quote something to sustain what he sees is his case. I will have to see whether he quoted St Vincent de Paul fairly; maybe he did. But, equally, I can point to the evidence that was given to the committee from another organisation which enjoys great respect—the Wesley Mission. I will quote from the submission that they made to the inquiry. Professor Alf Pollard, Honorary Secretary of the Wesley Mission, stated:The new tax reform will stimulate employment, encourage small business development and encourage international investment in Australia by making Australian goods more competitive. Higher employment will eliminate many of the social problems we are presently subsidising.The Wesley Mission agrees with this opinion. Senator Conroy, we can have this exchange of quotes. You have put one particular perspective; I have put another. The Wesley Mission deals with the destitute and the disadvantaged, and this particular body strongly supports tax reform.As I said, we can go through this debate. I listened to Senator Sherry late last week, and he was very anxious to get on to the bill. But what we have had this evening is a rerun of a very wide range of second reading debate speeches. Nonetheless, there were some questions that were asked. One of the speeches which I thought was of considerable substance, although I did not agree with it, and which was the sort of issue which would be raised in a second reading debate, came not surprisingly from Senator Cooney, a very distinguished member of this chamber.Senator Cooney was wondering why the definition of taxable supply is—in his view—so complicated. It is not complicated in the government's view, but Senator Cooney asked why that was the case and pointed to section 9-10(1). My response to that is that the bill is drafted in terms of a straightforward rule—`A supply is any form of supply whatsoever.' A number of examples are given in order to make the meaning of 9-10(1) clear. This is a new style of drafting which is intended to minimise litigation. I believe that you and I would share the view that we want to make the legislation as uncomplicated as possible, and we would argue that we have done that. You have a different view; nonetheless, it is an argument we can both run.We, for example, do not want transactions from private individuals to be in the system; hence the drafting has been carried out in those particular terms. We do not want transactions overseas to be in the tax system—they must be connected to Australia. Therefore, we need to define where the tax should apply. I think we have dealt with that issue. You and I may differ, but it was a valid question raised on the drafting of the bill.Senator Crowley put a number of questions on notice, and I will take those questions on notice and see what information can be provided. Senator Crowley was not sure whether the case had been followed up or whether people did not want to follow up the organisations and the particular matters that Senator Crowley mentioned. I rather liked Senator Crowley's last opinion: that, having listened to all the evidence, they were convinced that this was a package worth supporting. Nonetheless, Senator Crowley has raised those issues and we will look at them.3L6CONROYSenator Conroy—What about expenditure patterns?WW4Kemp, Sen RodSenator KEMP—I am coming to your issue, but you will have to wait your turn, Senator Conroy. Senator Crowley was also interested in the issue of embedded taxes and how they affect prices. We have published indicative price changes in the so-called ANTS package. I refer you to tables which start at page 170 and end on page 172 which deal with a very wide range of industries and look at the so-called price effects, in the publication Tax Reform: not a new tax, a new tax system . You were interested in the effect of the embedded taxes and how they affect prices. A very wide range of examples are given in this very comprehensive document with which we went to the last election and—in case we have forgotten, in view of the debate tonight—on which we were elected.You raised the question of the ACCC. Ultimately, in the policing of these matters the government must leave the matter to the ACCC, which is why we have an independent statutory authority. We think the record of the ACCC in ensuring competitive practices is good and we have confidence in that particular organisation.Senator Chris Evans interjecting—WW4Kemp, Sen RodSenator KEMP—We are trying to have a serious debate here, Senator Evans, and I thought we were almost succeeding until you arrived. Let me get on to Senator Conroy's issue. Senator Conroy seemed to take 30 minutes to make his points, as distinct from everyone else who made their points in 15 minutes. Let me make it clear that the estimated rise in the population-wide cost of living of 1.9 per cent in 2001-02 was derived by Treasury. The population-wide CPI increase of 1.9 per cent has been used to adjust the cost of living for each of the household groups included in the various cameos. Use of an average population-wide cost of living measure is consistent with the longstanding arrangements which adjust the value of social security payments for inflation, and I think in adjustments which we used under your government. Differences between household types are small, and my advice is that they cannot be reliably measured.The issue of different cost of living measures for different household groups has been examined in detail by the ABS. The ABS concluded there was almost no difference—3L6CONROYSenator Conroy—Over 11 years.WW4Kemp, Sen RodSenator KEMP—Despite the histrionics and the overacting which we had to witness, there has been almost no difference in the overall price increases that each household group faced over a period of 11 years. So, Senator Conroy, you should never confuse the histrionics and overacting for substance, if I can give you some advice. Treasury made it quite clear in the Senate committee hearing that it has always objected to using the HES. It has provided an analysis on the HES when directed to do so.3L6CONROYSenator Conroy—Why didn't you direct it? WW4Kemp, Sen RodSenator KEMP—Senator, you have had 30 minutes. I am going to respond without being interrupted. But—and I think this is important—even when using HES data, Senator, Professors Warren and Harding find no losers when they correctly model the government's compensation package. So despite the length at which you went on, the substance of the point is that there were still no losers. There was no group that they could point to.3L6CONROYSenator Conroy—That is just not true. You are misleading the Senate.WW4Kemp, Sen RodSenator KEMP—Senator Conroy then went on, I have to say, when reasonable assumptions are used.3L6CONROYSenator Conroy—Oh come on.WW4Kemp, Sen RodSenator KEMP—That is what I said. Senator Conroy is suggesting that people should be compensated for higher tobacco prices. Was that what you were saying or not? I took that to be what you were arguing. If that is the position you are arguing, it is not the Labor Party position. Don't remain silent now, Senator Conroy, having spoken.3L6CONROYSenator Conroy—You can't have it both ways.WW4Kemp, Sen RodSenator KEMP—My understanding is that Senator Conroy was suggesting—rather radically I might say—that people should be compensated for higher tobacco prices. I do not think that is the Labor Party position, however.ZS6QUIRKESenator Quirke—What have you got against smokers?WW4Kemp, Sen RodSenator KEMP—I do not want to take up the rest of my time to answer that question, Senator. The full CPI, including tobacco, is used for pensioner compensation.Senator Conroy interjecting—WW4Kemp, Sen RodSenator KEMP—I am rather surprised that you would wish to compensate in that way, Senator Conroy. In relation to the HES data, which was the nub of what I think Senator Conroy was on about, the truth of the matter is—Senator Conroy, this is going to come as a shock to you—that academics often differ and disagree.3L6CONROYSenator Conroy—But they didn't. They all disagreed with Treasury.WW4Kemp, Sen RodSenator KEMP—Both Professor Warren and Dr Carnahan—who I think may be known to you—have concerns about the use of the HES data. Dr Carnahan believes the concerns are too large to use HES. This is a person who is clearly well known to you and clearly greatly respected by you. He seems to believe, Senator, that the concerns in relation to HES are too large to warrant the use of HES. If that is the case, the government fully agrees with him.Senator Gibbs made an interesting contribution. I did not agree with it. Senator Gibbs seems to have gone. The substance of Senator Gibbs's case was that the tax reform package seems to not assist women and families. In that case we believe Senator Gibbs is wrong. The tax reform package significantly reduces effective marginal tax rates. Taper rates fall by some 20 per cent and effective marginal tax rates fall further with tax cuts.7Y6CROSSINSenator Crossin—It was women who are in jobs.WW4Kemp, Sen RodSenator KEMP—Thank you, Senator. Let me just mention that child care will fall in price because it is GST free. It is a major families package which we have provided. We think, Senator, that is a fair analysis of the package that we have put forward, and with the up-front rises in pensions and the guaranteed 1.5 per cent rise, the tax cuts that we are providing for families—656FORSHAWSenator Forshaw—I do not know too many pensioners who are using child care.WW4Kemp, Sen RodSenator KEMP—We are offering real rises in pensions and the Labor Party did not in the last election. One of the reasons we are here is that we showed some concern for pensioners.3L6CONROYSenator Conroy—You are not serious.WW4Kemp, Sen RodSenator KEMP—I am serious. We actually won the election and you lost the election. You have to explain why that happened. I am explaining to you that it is because we had better policies than you and people voted for us. There were a number of other matters that were put on notice and I will look closely into providing answers to those questions.22:35:004382Crossin, Sen TrishSenator CROSSIN7Y6NTALP00—Minister Kemp, I was going to rise to my feet and talk about a few issues relating to compensation but, before I do, your response has provided me with a number of further questions I would like to ask you. You made a statement that you believe that child care will fall in price. On what basis do you make that statement? There is no evidence that child-care fees will decrease. There is evidence that child-care centres will have to pay a GST on the goods that they purchase and then claim that back, but there is no evidence that child-care fees will fall as a result of that. There has been no evidence before the committees that the $130 a week that I pay now will be reduced once your GST comes in. In fact, you have said many times that child care will be GST free, so I am assuming that the general community can take from that that under your package the child-care fees will neither go up nor go down but parents can expect to be paying the same amount.I fail to see how you can make a statement that child care will fall in price. The evidence before us probably shows that, for child-care centres and child-care workers who currently may not have even a full-time or a part-time accountant, the load will no doubt fall once again on directors of child-care centres. They will be the people placed with the burden each month of having to calculate the GST component and trying to claim the rebate. I would like to see some evidence from the minister that child care will fall in price.The minister referred to a table in response to Senator Crowley. He said that it was part of the ANTS package. The document that he referred to, which has never been tabled in this Senate to my knowledge, was the tax reform package that was out and about in the community during the election campaign. I am not entirely sure that it is part of the formal GST package. It is not part of the explanatory memorandum or the bill. Is the minister going to table this document so that we can all have another comment on it?Senator Kemp interjecting—7Y6Crossin, Sen TrishSenator CROSSIN—You commented that it was part of your ANTS package. Perhaps I am suggesting that that is not entirely the case. Senator Crowley raised a number of questions, and there are questions on notice, concerning a guarantee that prices will fall. I would also be interested in having the minister pursue them. We hear a lot about the reduction in diesel fuel and the expectation that that will flow on to prices, particularly food prices, for example, in rural and remote communities. I would be interested if the minister would take it on notice to obtain what he believes will be the going prices prior to a GST being introduced.Over the weekend, I looked at the ACCC. I notice that they have an office in the Territory and that it is based in Darwin. I do not exactly know how many people work in that office. If they are going to be the regulatory body to oversee these price decreases around the community, I would like a guarantee from the minister that that office sitting 4,000 kilometres away from here has enough people and resources to get around the five major centres in the Territory and the 300 or so small rural and remote communities. They will ensure that, once this bill is in place, those prices are passed on to people in rural and remote communities. No doubt the minister is aware that they are the people who we believe can least afford to pay any increase in prices, particularly ones maintained under the government's regime, with decreases not being passed on by shopkeepers or store owners.Tonight I want to talk predominantly about the compensation package. I draw to the minister's attention a statement by the Australian Catholic Social Welfare Commission. This is a public document that has been produced by them just this month. The Catholic Church has always been quite renowned for putting out a number of fairly good documents and social commentary on the role of government, government policies and planned changes to the welfare system. We know that the Catholic Social Welfare Commission has always been involved in the debate on taxes and the tax summit since 1985. I will quote a message from Bishop Power, who is the Chairman of the Bishops' Committee for Social Welfare:It has become very clear in the course of the tax reform debate that a GST on food and other essentials in addition to unfair income tax cuts to high-income earners and inadequate compensation for disadvantaged citizens calls into question the equity of the overall tax package.He goes on to say:It is unlikely to deliver many of the long-term benefits its advocates claim if these unfair aspects of the package are not reformed so as to enhance the fairness of the system and reduce the tax burden and cost of living for vulnerable Australians.The GST is a flat rate tax. Like all flat rate taxes, the lower the person's income the greater the impact of the tax on the person's living standards and, hence, their personal wellbeing. Even the government has acknowledged that compensation is necessary.What we have been looking at in debates—Senator Harradine stood on his feet last week and considered this—is the degree of that compensation and whether it is enough. The government is proposing a complex system of compensation comprising income tax cuts and increases in social security payments. My belief is that this compensation is highly regressive and totally inadequate for a large number of low and middle income Australians. We have been saying all along, and we still maintain the position, that under the proposed income tax changes the top 20 per cent of income earners get over 50 per cent of the benefits from the proposed income tax. That leaves only 80 per cent of income earners with less than 50 per cent of the proposed benefits.I ask Senator Kemp what sort of modelling not only Treasury but some of the other departments within government did on the impact of the tax package on people living in extremely remote communities. In particular, what is the impact on their health and lifestyle and the impact on their ability to purchase? As I asked in my speech on the second reading debate, what is the impact on their ability to purchase fresh food as opposed to junk food? What is the impact on Aboriginal people in communities where they are on CDEP, the Community Development Employment Program? I guess that `Community Development Employment Program' is a quaint term for working for the dole. What is the impact in those communities where a lot of those people are not on any of those benefits?So if people are not eligible for any social security payment or any pension, they are not eligible to get their four per cent increase. If they happen to live in a remote part of this country where there is one shop and that has a monopoly on the goods that are available—and prices in those shops are basically already through the roof—and we have an ACCC office based in Darwin that probably has very limited resources and staffing, I put it to you: what hope do these people out in remote Australia have of ensuring that what you are promising in your tax package is going to get through to them?So in a situation where people are not on any social security benefit, there is one shop out there where prices are through the roof, you can give me no guarantee about a flow-on for the reduction of those prices. There has been no modelling done, there has been no discussion about whether a GST is going to impact on these people's health or not, because fresh foods will go up and junk foods will go down, and you can stand up and say to us that the GST will be good for everybody. I stand here ready to be convinced but at this stage I can see nothing before me that is going to assist me in changing my mind. There is no good news for the people I represent in the Northern Territory, I am afraid.The tax cuts for the higher income households far outweigh the increases in the social security payments you are promising for lower income households. For example, your own calculations show that a single person earning $100,000 a year will get an extra $64 a week—25 times the weekly benefit of the lowest income single person. A couple with no children earning $100,000 a year get $80 a week—five times the benefit that the lowest single income family with three children gets.But the situation gets a little worse in fact if we look at compensation for families. If you have children, your compensation package is based on the ridiculous assumption that it costs only 30c a week to raise a child. I am not entirely sure what I could buy any of my kids for 30c. I would be struggling probably to even get a packet of PK chewing gum at this rate. Not even the newspaper or the daily rag costs 30c. According to the cameos in your GST manual on tax reform, the GST will increase the costs of a couple earning $30,000 a year with no children by $9.33 a week. But if the same couple had one child, then their costs would rise by $9.63 a week. You are saying that with no children it is $9.33 but with one child it is $9.63, so you want us to believe that families will get a benefit of only—3L6CONROYSenator Conroy—Thirty cents.7Y6Crossin, Sen TrishSenator CROSSIN—Thirty cents. On a good day, I guess, in Darwin that might buy me a couple of grapes.3L6CONROYSenator Conroy—A Chuppa Chup.7Y6Crossin, Sen TrishSenator CROSSIN—Well, no, Chuppa Chups are now about 60c, I am afraid, so that child would actually have to wait a fortnight to get one Chuppa Chup.656FORSHAWSenator Forshaw—You just get the Chup.7Y6Crossin, Sen TrishSenator CROSSIN—That is exactly right. You just get half of the lollipop. But the GST is regressive. We have seen the information misleading pensioners in claiming that the GST compensation is in addition to the existing pension increase entitlements. The one-off payment of $3,000 for self-funded retirees is unlikely to compensate them for a lifetime devaluation of their savings. In relation to the statement I produced before from the Catholic Welfare Social Commission—it is a good read, Senator Kemp; I urge you to pick it up.656FORSHAWSenator Forshaw—Does it have any pictures?7Y6Crossin, Sen TrishSenator CROSSIN—No, there are no pictures, so it is probably not a read then. You have to concentrate to read this. They go on to say that your package `will impose the same burden on all Australians regardless of their income and disadvantage low- and middle-income earners who already carry a high burden of indirect taxes on the consumption of goods and services which are essential to their continued well-being.' That is a true statement. Your package does not differentiate as to whether or not you can afford the goods before you. Everybody will be taxed in the same way, everybody will be paying the same amount, despite the fact that their disposable income may not be at the same level—and we know it is not. On the very last page of the this document, there is a statement that sums it all up:It is now beyond doubt that the impact of a GST and the tax package on low income individuals and families—this is the Catholic Church speaking here—is underestimated and that the proposed compensation measures are inadequate.I finish by saying, Senator Kemp, that I would be interested if you could respond to some of those issues that I have raised during my speech.22:50:004385Kemp, Sen RodSenator KEMPWW4VICLPAssistant Treasurer10—I am very encouraged to respond to those issues—10000TEMPORARY CHAIRMANThe TEMPORARY CHAIRMAN (Senator Crowley)—Minister, I take this moment to remind all senators to address the chair and not speak across the chamber to their colleagues.WW4Kemp, Sen RodSenator KEMP—Thank you, Madam Chair, for the reminder, and a most appropriate one. I think it has been flouted quite regularly this evening, if I recall correctly. I appreciate your drawing it to our attention. Senator, I think you indicated that you have a bit of an open mind on this. I am not sure you do, to be quite frank. I do not think the Labor Party allows an open mind in relation to tax reform. I think the Labor Party has very strict rules on people who have an open mind on tax reform, particularly people who might decide that the time has come to support something which is good for Australia but not good for the Labor Party. I hear what you say but you will note that I am not entirely convinced by the rhetoric you used.This has taken up an inordinate amount of time this evening. We have had a wide range of second reading debate speeches. Senator, you canvassed issues which were covered in question time today. I was asked a very similar question on the distributional effects to the one that you raised. Maybe you have the same speech writer as Senator Jacinta Collins. As usual, I gave a very detailed and comprehensive answer which was entirely convincing. It seems unusual that the same assertions are being made, the same questions are being asked and the same responses are being given, and it does not seem to wash.There was a serious problem of logic in some of the material you read. The big cuts that we are giving in diesel excise are going to benefit rural and regional Australia. You are a senator for the Northern Territory. Those cuts will provide huge benefits to the people of the Territory. The cost savings will flow through all those things.3L6CONROYSenator Conroy—You haven't even convinced Senator Tierney. He is out there saying that you have to provide more compensation.WW4Kemp, Sen RodSenator KEMP—You haven't convinced Premier Carr, Premier Beattie or Premier Bacon, and you have not convinced Mr Bob Hogg. If we are going to have a frank exchange of names, you lose on that issue. Senator Crossin, it is astonishing that you would totally wipe out any advantage to the Northern Territory from very substantial cuts in diesel fuel excise. It is an astonishing thing for a senator from the Northern Territory to say.7Y6CROSSINSenator Crossin—I am asking you to provide me with some proof of that.WW4Kemp, Sen RodSenator KEMP—If we raised the tax on diesel, that would have a profound effect on the Territory. We are cutting the excise on diesel very substantially. This will flow through to all the things you mentioned. You were worried about the cost of food and transport. There will be huge savings to your constituents which you are closing your mind to. I think it is a great pity that you have decided to adopt that position. You are worried about the effects which you allege various groups are going to suffer. Relentless modelling carried out by the Senate select committee under any reasonable assumptions could not point to any group that was worse off.3L6CONROYSenator Conroy—That is not true.WW4Kemp, Sen RodSenator KEMP—That was the bottom line. Talk about ignoring the evidence! You have not been able to sustain the case. Under any reasonable assumptions, the modelling was not able to point to any group that was worse off.Senator Crossin, you raised the issue of staffing of the ACCC. As you know, the government has allocated substantial resources to the ACCC. It is responsible for setting its staffing priorities. We believe that we have set up an important system which will provide great comfort to people in knowing that we will deal with those who attempt to exploit the changes that we are bringing in in the transitional phase. You were worried about child care. Child-care centres will benefit from the removal of a host of embedded taxes.3L6CONROYSenator Conroy—Such as?WW4Kemp, Sen RodSenator KEMP—Such as fuel excise, for example, and the FIDs and the BADs—a whole host of things.Opposition senators interjecting—WW4Kemp, Sen RodSenator KEMP—You want to keep all those taxes and we wish to remove them. That is the difference between your position and our position.3L6CONROYSenator Conroy—Are your advisers following you around nodding?WW4Kemp, Sen RodSenator KEMP—The difference between you and me is that I have good advice and you obviously have no advice because otherwise you would not have ranged so far and wide and got so many things comprehensively wrong. Senator, I do not think you have an open mind on this. Are you opposed to major cuts in diesel prices?7Y6CROSSINSenator Crossin—I'm not sure that you have the answers. WW4Kemp, Sen RodSenator KEMP—It is interesting that I cannot even get a concession out of a senator for the Northern Territory about whether it is best to have lower or higher diesel prices. I put the question to you once again: are you in favour of higher or lower diesel prices? Remember that this benefits rural and regional Australia. Senator Crossin, the Labor senator with the open mind, cannot indicate whether or not she is in favour of lower diesel prices. Senator, can you indicate whether you are in favour of major tax cuts?7Y6CROSSINSenator Crossin—You cannot answer the question.WW4Kemp, Sen RodSenator KEMP—Senator Crossin cannot even give an indication that she is in favour of major tax cuts. I regret to say that I do not think you are thinking carefully about what is in the best interests of the Northern Territory. If you did, you would strongly support the position.7Y6CROSSINSenator Crossin—I don't think you have any answers to my questions.WW4Kemp, Sen RodSenator KEMP—Senator Crossin, all I can say is that we are over here and you are over there.22:59:004387Evans, Sen ChrisSenator CHRIS EVANSAX5WAALP00—I wanted to get onto the question of consumption patterns but, as I have got only about a minute, I think the interesting response I can make to the minister's debating point is that, if diesel fuel prices are to come down, I would like him to explain what this means for food prices, particularly for remote Aboriginal communities in the Northern Territory. During the Senate inquiry I actually asked the Department of Health and Aged Care that very question, because obviously food prices and consumption of food in those remote Aboriginal communities are a very important issue in terms of both their health and their standard of living. The health department said to me that they were not able to help me because they had not done any work on the GST and the impacts of the GST on their client base or on their operations. The health department could not tell me what the impact of the GSTwas on the health of Aboriginal or other Australians because they had not done any work. So, if you are going to make an argument about fuel prices, I assume you have done the work to be able to explain to the Senate what the impact on the health of Aboriginal communities in the Northern Territory is.Progress reported.23:00:004387Senate adjourned at 11.00 p.m.Documents43874387The following documents were tabled by the Clerk:Civil Aviation Act—Civil Aviation Regulations—Civil Aviation Orders—Directive—Part—105, dated 16 [2], 19 [2], 24, 25 [6], 26 and 31 March; and 1, 6 [13] and 9 [5] April 1999.106, dated 6 [2] and 9 April 1999.Instrument No. CASA 106/99.Migration Act—Regulations—Statutory Rules 1999 No. 64.Native Title Act—Native Title (Right to Negotiate—Alternative Provisions) (Northern Territory Lands Acquisition Laws) Determination 1999.Native Title (Right to Negotiate—Alternative Provisions) (Northern Territory Mining Laws) Determination 1999.Native Title (Right to Negotiate—Alternative Provisions) (Northern Territory Petroleum Laws) Determination 1999.Answers to Questions on Notice4388The following answers to questions were circulated:4388(Question No. 304)3044388Ray, Sen RobertSenator Robert RayUI4VICALP00 asked the Special Minister of State, upon notice, on 30 November 1998:On each of the three instances that Mr Mark Andrew Textor was employed by Dr Wooldridge (26 July 1993 to 27 August 1993, 14 March 1994 to 8 May 1994, and 9 May 1994 to 3 June 1994):(a) what travel allowance, if any, was paid to Mr Textor; (b) what are the details of any travel allowance paid to Mr Textor, including rate, dates and destinations; (c) what was the cost and details of any travel, including airfares, by Mr Textor; and (d) what was the cost and details of any cabcharge and/or hirecar etc. used by Mr Textor.4388Ellison, Sen ChrisSenator Ellison9X5WALPSpecial Minister of State10—The answer to the honourable senator's question is as follows:(a)-(d) The Department of Finance and Administration has no record of Mr Textor claiming travelling allowance, travelling away from his home-base at official expense or using cabcharge or hire car services during the periods 26 July 1993 to 27 August 1993, 14 March 1994 to 8 May 1994, and 9 May 1994 to 3 June 1994.4388(Question No. 346)3464388O'Brien, Sen KerrySenator O'Brien8O6TASALP00 asked the Minister representing the Minister for Transport and Regional Services, upon notice, on 8 December 1998:(1) What consultation did Airservices Australia undertake in relation to the introduction of Class E airspace.(2) When did those consultations commence, who was consulted and when was the consultative process completed.(3) Was the proposal supported by all parties who participated in the consultative process; if not: (a) who opposed the proposal; and (b) what was the basis of their opposition.(4) Was the Minister or his office advised of the progress of these consultations; if so, when was he advised and how was that advice provided. (5) (a) How many parties who participated in the consultative process raised concerns about the proposed width of the Class E airspace corridors; (b) when were those concerns raised; and (c) were the matters of concern about the width of the corridors resolved to the satisfaction of all parties.(6) If these matters were not resolved what was the justification for Airservices Australia proceeding with the trial.(7) Was the Minister or his office advised of any concerns about the proposed width of the corridors in the new Class E arrangements; if so, when was the advice given and how was the advice provided.(8) Was the width of Class E corridors for Melbourne to Mildura, Mildura to Canty, Dubbo to Bindock, Sydney to Dubbo and Dubbo to Broken Hill set at 5 nautical miles.(9) Was the Minister or his office advised of the outcome of this consultative process and did the Minister endorse the final arrangements for Class E airspace.(10) When was the decision taken to review the width of the above corridors.(11) (a) What was the reason for the review; (b) who undertook the review; (c) what was the result of the review; (d) on what date did it commence; and (e) when was it completed.(12) Was the Minister or his office advised of the review; if so, when was that advice given.(13) Did the Minister or his office endorse the changes to the corridor width; if so, when were the changes endorsed.4388Macdonald, Sen IanSenator Ian MacdonaldYW4QLDLPRegional Services, Territories and Local Government10—The Minister for Transport and Regional Services has provided the following answer to the honourable senator's question:(1)—(2) An area of Class E airspace was introduced between Canberra and Ballina on 26 February 1998. The Civil Aviation Safety Authority (CASA) has advised that they organised an industry safety monitoring meeting which was held on 15 May 1998 at which the major issue was carriage and use of transponders in the airspace. This issue was subsequently resolved and since that time, Class E airspace has been operating successfully in this area. As a consequence, it is assumed that this question refers to the specific issue of Class E corridors. Airservices Australia has advised that consultation with industry was initiated and managed by CASA. Airservices' consultation was restricted to procedures discussions with affected Air Traffic Services staff, and on-going discussions with CASA over corridor widths.The consultative process within Airservices began in the first half of 1998, with regard to suitable candidate routes to be trialled as Class E corridors. There was ongoing consultation up to the implementation of five new corridors on 3 December 1998.The introduction of Class E corridors was first proposed in the Airspace 2000 document produced in June 1996.Class E corridors featured in CASA's Notice of Proposed Rule Making 9702RP (Airspace Classification G) which was published by CASA in August 1997 (for which public comment was invited). It was mailed to over 100 industry organisations, and a total of 730 responses were received from all industry sectors.The intention to conduct a demonstration of several Class E corridors was discussed at an industry briefing in May 1998, which was attended by Chief Pilots of the airlines which would be involved. At this meeting they were asked to nominate suitable routes. They did this on the spot, nominating the routes on which the Class E corridors were subsequently introduced.The proposed routes, lower limits and dimensions were confirmed with the relevant Chief Pilots by telephone and fax early in July 1998. A proposed implementation timetable was also faxed to Chief Pilots and Airservices on 9 July 1998. Airservices' draft chart amendments were mailed out to Regional Airspace Users Advisory Committee (RAPAC) members on 13 July 1998.On each of these occasions, feedback and comments were sought.A draft of the Aeronautical Information Publication Supplement (AIP SUP) providing notification of the establishment of the corridors was sent by fax to Chief Pilots of affected airlines on 14 August 1998, and after revisions, advance notice of the final AIP SUP was forwarded by fax on 16 October 1998.(3) and (5) Airservices has advised that within Airservices, the proposal was not supported by affected air traffic controllers due to concerns over the proposed width of the Class E corridors. Airservices management also raised concerns related to air traffic services procedures which were a consequence of the proposed width. CASA confirms it was made aware of these concerns emanating from within Airservices. Within industry, CASA has advised that the Australian Federation of Air Pilots (AFAP) and the Regional Airlines Association of Australia (RAAA) had objections.AFAP objected to the width of the corridors and to the establishment of Class E airspace beyond radar coverage. These objections were submitted on 20 July 1998.The RAAA objected to the width and the lower limits of the corridors, although these objections were not expressed by the affected member airlines. These objections were submitted on 28 July 1998.Not all concerns were resolved to the satisfaction of all parties.(4), (7), (9), (12)—(13) My staff and I regularly discuss aviation issues with CASA, Airservices Australia, and my department. Revealing the details or timing of those discussions would discourage officials from providing me with the full and frank advice that is essential for effective government policy making.(6) Airservices has advised that since the introduction of Class E corridors offered an opportunity to enhance aviation safety in a number of areas, it was important to proceed with the trial to demonstrate the effectiveness of the system and to gather empirical data in a low density area under controlled conditions.(8) No. CASA has advised that it set the minimum standard for Class E airspace corridors at 5 nautical miles on either side of the route centreline, giving a total width of 10 nautical miles. On implementation, Airservices made an operational decision to exceed that minimum standard.(10)—(11) The minimum standard set by CASA was not reviewed. Airservices has advised that senior management decided on 2 December 1998 to proceed with the trial but with the width of the corridors increased to address the concerns of industry and air traffic control.4389(Question No. 390)3904389Faulkner, Sen JohnSenator Faulkner5K4NSWALP00 asked the Minister representing the Minister for Veterans' Affairs, upon notice, on 21 December 1998:(1) Can a list be provided of all funding announcements for the period 1 August to 3 October 1998.(2) When were these funding announcements for programs or grants made and by whom.(3) (a) When were submissions for each program or grant received by the department; and (b) when were they submitted to the Minister. (4) (a) Which programs or grants were recommended to the Minister for funding approval; and (b) when were the recommendations made.(5) Where a program or grant was not originally recommended for funding by the department: (a) what was the approval process; and (b) what factors were taken into account by the Minister.(6) On what dates was the final decision taken to fund each successful program or grant.4390Newman, Sen JocelynSenator NewmanBE4TASLPFamily and Community Services; Minister Assisting the Prime Minister for the Status of Women10—The Minister for Veterans' Affairs has provided the following answer to the honourable senator's question:Detailed answers are provided below by program.Grants in Aid Program(1) Royal Australian Air Force Association $3,250.(2) I made the announcement on 28 August 1998.(3) My Department received the application for the grant on 25 August 1998.The application was submitted to me on 28 August 1998.(4) and (5) Responsibility for approving grants under this program is vested in the Minister. Individual grant decisions are made by the Minister in accordance with program guidelines. It is not appropriate nor is it standard practice to release details of advice provided to Ministers in relation to individual decisions.(6) The final decision was taken on 28 August 1998.Residential Care Development Scheme (RCDS)(1)OrganisationGrant Amount ($)Mercy Family Centre—South Sydney Local Government Area30,000Mercy Family Centre- Ku-ring-gai & Hornsby Local Government Areas40,000Anglican Retirement Villages/Diocese of Sydney35,020Mid North Coast Community Care Inc42,975Hammond Care Group50,000Lutheran Church of Australia20,000Rylestone Kandos District Aged and Disabled Persons Welfare Association Inc5,000Catholic Care of the Aged50,000United Protestant Association of NSW Ltd50,000Vasey Housing Association of NSW38,012Benevolent Society of NSW—Lane Cove, Willoughby & North Sydney Local Government Areas25,650Benevolent Society of NSW—Canterbury & St George region41,000Council of the Shire of Kempsey25,750Trustees of Roman Catholic Church—Diocese of Lismore48,000The Milpara Centre30,293Southern Cross Aged Care Victoria—Barwon, Queenscliff, Colac Otway & Surf Coast Areas11,520Southern Cross Aged Care Victoria—Cardinia, Casey & Greater Dandenong Areas8,710Southern Cross Aged Care Victoria—Kingston & Bayside Areas41,508Southern Cross Aged Care Victoria—Eastern Melbourne Metropolitan Area45,409Swan Hill Rural City Council15,220Villa Maria Society for the Blind—Outer Eastern Melbourne Metropolitan Area25,000Villa Maria Society for the Blind—Eastern Melbourne Metropolitan Area49,451St Laurence Community Services (Barwon) Inc28,850 The Uniting Church in Australia Property Trust (Vic)24,350Uniting Church in Australia Property Trust- Blue Nursing Service Allora/Clifton5,000Uniting Church in Australia Property Trust-Blue Nursing Service Caboolture25,000Uniting Church in Australia Property Trust- Blue Nursing Service Gold Coast/Tweed25,000Uniting Church in Australia Property Trust—Blue Nursing Service Gympie10,000Uniting Church in Australia Property Trust—Blue Nursing Service Rocklea20,000Uniting Church in Australia Property Trust—Blue Nursing Service Sandgate20,000Uniting Church in Australia Property Trust—Blue Nursing Service Warwick5,000Uniting Church in Australia Property Trust—Blue Nursing Service North Queensland region55,000Bauhinia Shire Council—Springsure & District Aged Care Committee6,500St Vincent's Community Services—De Paul Respite Centre13,000St Vincent's Community Services—St Louise De Marillac Day Respite Centre13,000St Vincent's Community Services—Brisbane North13,000Elderly Citizens Homes of SA Inc—Charles Sturt Local Government Area50,000Elderly Citizens Homes of SA Inc—Adelaide/Walkerville/Prospect Local Government Areas30,000Alwyndor Aged Care33,800Home Care Services40,000Huon Districts Eldercare Home Association Inc5,000Southern Midlands Council5,000(2) I made the announcements on 30 August 1998.(3) (a) Between June 1998 and mid-August 1998.(b) 28 August 1998(4) and (5) Responsibility for approving grants under this program is vested in the Minister. Individual grant decisions are made by the Minister in accordance with program guidelines. It is not appropriate nor is it standard practice to release details of advice provided to Ministers in relation to individual decisions.(6) 28 August 1998Joint Venture Scheme(1) Launceston RSL Sub-Branch $20,000(2) I made the announcement on 24 September 1998.(3) (a) A letter of request was received on 22 September 1998.(Note: This grant was a supplement to a grant of $70,000 approved on 13 February 1998; due to cost escalation beyond the recipient's control, completion of the project could not be achieved without additional funding.)(b) 24 September 1998 (4) and (5) Responsibility for approving grants under this program is vested in the Minister. Individual grant decisions are made by the Minister in accordance with program guidelines. It is not appropriate nor is it standard practice to release details of advice provided to Ministers in relation to individual decisions.(6) 24 September 1998Veteran Hospital and Health System(1) $1 million for new Veterans' Services at Concord Hospital. The new services and facilities will include:. appointment of a Veterans' Liaison Officer. a telephone hotline for veterans and war widows for hospital enquiries,. a clinic for prostate cancer and other urological diseases,. upgraded day programs for veterans with mental illness,. an education and management program for veterans with neurodegenerative disorders, such as dementia and Parkinson's Disease,. a "one stop" clinic for the management of degenerative joint disease, . maintenance of commemorative areas including the Kokoda Track Memorial Walkway, the POW Rose Garden, the Centaur Memorial and the 113th AGH Memorial Chapel; and. a War Nurses Museum.(2) I announced it in a Media Release on 17 September 1998(3), (4), (5) & (6) The arrangements were negotiated in July and August 1998 with the State of New South Wales as part of the Repatriation Commission purchase of health care for entitled veterans for 1998/99.Their Service—Our Heritage commemorative grants(1) The names of all organisations and individuals whose applications for grants under the Com-memorative Activities Program (CAP), Local Commemorative Activities Fund (LCAF) or Regional War Memorials Project (RWMP) components of Their Service—Our Heritage were successful, and were decided during the period 1 August—3 October 1998, are shown at (3) below. Grants to successful applicants are announced through a letter of offer to the applicant, with a letter of advice also forwarded to the local Member of Parliament or Duty Senator which includes a media release on the approved grant.(2) In accordance with established procedures the Minister advises the applicant organisation, and the local Member of Parliament or Duty Senator in writing shortly after making the decision on their application.ApplicantReceived DepartmentSubmitted to MinisterGrant Amount ($)Date Rec. MadeBuloke Shire Council27/8/9831/8/98130031/8/98Coomba Park Ex-Services Memorial Association10/8/9825/8/98300026/8/98Tara RSL17/8/9831/8/98300031/8/98Gold Coast City Council25/8/9831/8/98300031/8/98Bingara RSL20/7/9825/8/9866026/8/98Bingara RSL14/8/9825/8/98125526/8/98Peak Downs Shire Council24/8/9831/8/98200031/8/98Stuart Braga31/8/9831/8/98600031/8/98Bauhina Shire Council26/8/9831/8/98200031/8/98Glenelg RSL12/8/9825/8/98150026/8/98Wonga Park Hall Committee10/8/9825/8/9850026/8/98Enoggera & District Memorial Hall7/8/9825/8/9850026/8/98Injermira Soldier Settlement Estate10/3/9825/8/9830026/8/98Lindley Deacon12/8/9831/8/98100031/8/98Bundaberg East State School24/8/9831/8/98140031/8/98Webster Publishing27/8/9831/8/98200031/8/98Sister Kenny Memorial Fund13/8/9825/8/98100026/8/98National Malaya & Borneo Veterans Association of Australia10/8/9821/9/9837030/9/98Tasmanian Museum and Art Gallery18/8/9825/8/98100026/8/98Mullumbimby RSL11/6/9817/8/98100018/8/982/3 Machine Gun Battalion24/6/9817/8/98100018/8/98RAAF WA Radar Group3/6/9817/8/9863418/8/98Wartime Vehicle Conservation Group22/6/9817/8/98100018/8/98Royal Australian Navy Corvettes Association WA24/6/9817/8/98150018/8/98Moonan Flat Soldiers Memorial Hall24/6/9817/8/98150018/8/98Bretts Wharf Memorial Committee24/6/9817/8/98180018/8/98The Quiet Lion Committee29/6/9817/8/98100018/8/98 City of Holdfast Bay29/6/9817/8/9850018/8/98Coalfield Heritage Group3/7/9817/8/9811518/8/98War Widows' Guild of Australia Gold Coast Sth23/6/9817/8/9830018/8/982/4 Australian Infantry Battalion Association23/6/9817/8/98100018/8/98Shore War Service Project25/6/9817/8/98100018/8/98Wauchope Community Arts Council30/6/9817/8/98100018/8/98Tregeagle Hall Inc26/6/9817/8/98120018/8/98Yass Remembers 1918 Committee29/6/9817/8/98150018/8/98Horsham RSL22/6/9817/8/9885018/8/98HMAS Manoora Association25/6/9817/8/98100018/8/98Bendigo Ex-Servicewomen's Club13/7/9817/8/98130018/8/987th Australian Division Cavalry Regiment9/7/9817/8/98100018/8/98Rockhampton City Council15/7/9817/8/98150018/8/98Clarence River Historical Society9/7/9817/8/98100018/8/98Warwick Combined Services Club14/7/9817/8/98250018/8/98Griffith RSL16/7/9817/8/98100018/8/9842 Landing Craft Company Book Committee21/7/9817/8/98100018/8/98JG Patterson23/7/9817/8/98100018/8/98Cowra Shire Council27/7/9817/8/98100018/8/98Warracknabeal & District Historical Society30/7/9817/8/9860018/8/98Fort Scratchley Historical Society30/7/9817/8/98100018/8/98Donald RSL3/8/9817/8/9850018/8/98No 2 Airfield Construction Squadron7/7/9817/8/9825018/8/98The Salvation Army Heritage Centre8/7/9817/8/98200018/8/98Royal Australian Army Pay Corps Historical Collection10/7/9817/8/98100018/8/984/5 Squadron RAAF Association10/7/9817/8/9837518/8/98Frankston Naval Memorial Club Inc4/8/9817/8/98150018/8/98RAAF Association Victoria17/8/98100018/8/98Milthorpe & District Historical Society6/7/9817/8/9850018/8/98Port Lincoln High School10/7/9817/8/98100018/8/98City of Perth Branch, RAAF Association WA5/8/9817/8/9850018/8/98Latrobe RSL28/7/9817/8/98100018/8/98Launceston RSL Sub-Branch4/8/9817/8/98100018/8/982nd Field Regiment AIF Reunion30/7/9817/8/9820018/8/982/17 AIF Battalion Association7/8/9817/8/98100018/8/982/11 AIF Battalion Association29/7/9817/8/98100018/8/98Nepean Historical Society8/8/9817/8/98100018/8/98Shirley Huie7/8/9817/8/98100018/8/982/7 Field Ambulance Association22/6/9817/8/9850018/8/98Enoggera & District Memorial Hall Association7/8/9817/8/9850018/8/98 Home Hill RSL10/8/9817/8/9880018/8/98Warwick Central State School11/8/9817/8/98150018/8/98Grafton Primary School12/8/9817/8/98150018/8/98Tumby Bay Community Development Board3/3/9817/8/98100018/8/98Friends of Grantham12/5/9817/8/9895018/8/982/28 Australian Infantry Battalion & 28 Anti Tank Company Association26/5/9817/8/98150018/8/98Gold Coast & District Ex-Servicewomen's Assn6/6/9817/8/9850018/8/98Barry Dickins12/5/9817/8/98100018/8/9852 Field Park Co RAE AIF Ex-Members Assn6/6/9817/8/9831018/8/98Cessnock RSL15/6/9817/8/98180018/8/98A Gathering of Eagles8/7/9817/8/98500018/8/98The Boomerang March Re-enactment Association21/7/9817/8/981000018/8/98City of Greater Bendigo16/7/9817/8/98600018/8/98The RAR National Memorial Walk27/7/9817/8/98500018/8/98The Australian Light Horse Association31/7/9817/8/98150018/8/98Centre for Regional Development26/6/9817/8/982500018/8/98RAAF Association, North West Branch10/6/9817/8/98150018/8/98Wentworth Falls RSL4/6/9817/8/98100018/8/98Northampton RSL8/7/9817/8/9820018/8/98Ararat RSL15/6/9817/8/98150018/8/98City of Holdfast Bay29/6/9817/8/98150018/8/98Holy Trinity Anglican Church Glen Innes6/7/9817/8/98150018/8/98Harden—Murrumburrah Light Horse Committee2/7/9817/8/98150018/8/98Rotary Club of Unley8/7/9817/8/9850018/8/98Krambach RSL19/6/9817/8/98300018/8/98Rydal Showground Trust26/6/9817/8/98100018/8/98Macedon Ranges Shire Council24/6/9817/8/98300018/8/98Shortland RSL16/7/9817/8/98250018/8/98Rockhampton City Council16/7/9817/8/98200018/8/98Mackay City Council2/7/9817/8/98300018/8/98Enoggera & Districts Memorial Hall Association16/7/9817/8/9825518/8/98Nymboida Shire Council20/7/9817/8/98125018/8/98Bellata RSL16/7/9817/8/9835018/8/982/28 Battalion & 24 Anti Tank Company1/7/9817/8/9870018/8/98Sussex Inlet RSL23/7/9817/8/98150018/8/98Naracoorte RSL27/7/9817/8/9850018/8/98Caboolture RSL14/7/9817/8/9850018/8/98Wandoan RSL17/7/9817/8/98200018/8/98Taree RSL23/7/9817/8/98200018/8/98Woonona—Bulli RSL27/7/9817/8/98100018/8/98 Drummoyne RSL28/7/9817/8/9860018/8/98Oatlands RSL28/7/9817/8/98150018/8/98Adamstown RSL30/7/9817/8/9850018/8/98Longford RSL30/7/9817/8/98150018/8/98Donald RSL3/8/9817/8/98110018/8/98Seaforth RSL24/7/9817/8/98300018/8/98Longwarry RSL23/7/9817/8/9850718/8/98Clunes RSL31/7/9817/8/98100018/8/98Coonalpyn Soldiers Memorial Gates31/7/9817/8/9875018/8/98Homebush—Strathfield RSL7/8/9817/8/9838018/8/98Mudgeeraba RSL30/7/9817/8/98150018/8/98Rockley—Burrach War Memorial Committee7/8/9817/8/98137518/8/98Tyalgum Progress Association11/8/9817/8/98266.3518/8/98Elliott Heads Bowls Club11/8/9817/8/9830018/8/98Wallumbilla School of Arts Hall Committee10/8/9817/8/9835018/8/98Goombungee RSL7/8/9817/8/9860018/8/98Karuah RSL10/6/9817/8/98100018/8/98Ivanhoe RSL23/7/9817/8/9890018/8/98Morphett Vale & District RSL25/5/9817/8/98200018/8/98Wantabadgery Soldier Settlers Memorial Reunion Committee15/6/9817/8/98100018/8/98Hawkesbury City Council11/8/9817/8/98100018/8/98Berrimah Operation Room22/5/9817/8/9830018/8/98Commando Association, Hervey Bay22/7/9817/8/98150018/8/98(4) and (5) Responsibility for approving grants under this program is vested in the Minister. Individual grant decisions are made by the Minister in accordance with program guidelines. It is not appropriate nor is it standard practice to release details of advice provided to Ministers in relation to individual decisions.(6) The date that the final decision was taken to fund each successful grant has been included in the answer to question (3) above.4395(Question No. 440)4404395Brown, Sen BobSenator BrownQD4TASAG00 asked the Minister representing the Minister for Defence, upon notice, on 8 March 1999:During the era of Indonesian President Suharto (1965-98):(1) (a) What military weapons were sold by Australia or given in defence aid packages to the Suharto Government; (b) what was their market value; and (c) can the relevant dates be provided.(2) (a) What was the final cost to the Australian taxpayer of the defence cooperation exercises with Indonesia in bilateral and multilateral exercises; and (b) can the relevant dates and names of the exercises be provided.(3) (a) What was the financial cost to the Australian taxpayer of the defence training by the Australian Armed Forces of Indonesian soldiers; and (b) can the relevant dates and statistics be provided.(4) What was the total figure cost to the Australian taxpayer from the department for military aid and cooperation with the Suharto regime.4395Newman, 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 honorable senator's question:Given the limited time and resources available to address your question, I am unable to provide detailed and accurate figures dating back to the beginning of the Suharto Government (1965), however, the following response provides information over the ten year period from about 1988 to 1998.(1) (a) (b) and (c) The Australian Government did not sell any weaponary to the Suharto Government from FY1988/89—FY1998/99.Tabled below is a list of weapons supplied to the Indonesian Government through the Defence Cooperation Program from FY1987/88—FY1998/99.Date (Permit Issued)Description of GoodsQtyValue (AUD)20 Oct 874.5inch High Explosive Ammunition5$26,7804.5inch Practice Ammunition510 Jun 884.5inch Ammunition450$1,247,9304.5inch Practice Ammunition16202 Jun 89.5inch High Explosive Ammunition250$891,661.5inch Practice Ammunition25014 Feb 904.5inch Ammunition400$874,00019 Mar 97Nomad Aircraft (including a logistics support package)20$4,000,000(2) (a) and (b) Tabled below are the aggregated and total costs for each financial year of all Australian/Indonesian combined military exercises, programmed since FY1993/94, and the dates of the exercises.Financial YearCost (AUDmillion)Combined ExercisesDates1998/99*0.277*ALBATROSS AUSINDO 99-528 Mar 99—1 Apr 99TRISETIA 98/9919 Mar 99—29 Mar 99SATRIA BHAKTI 9830 Nov 98—4 Dec 98ELANG AUSINDO 98-411 Nov 98—21 Nov 98RAJAWALI AUSINDO 98-512 Oct 98—16 Oct 98ALBATROSS AUSINDO 98-420 Sep 98—26 Sep 98CASSOWARY 98-213 Sep 98—17 Sep 981997/980.109NEW HORIZON IX/9812 May 98—20 May 98ALBATROSS AUSINDO 98-36 May 98—30 Jun 98CASSOWARY 98-127 Apr 98—1 May 98ALBATROSS AUSINDO 97-21 Dec 97—5 Dec 97SATRIA BHAKTI 9710 Nov 97—14 Nov 97RAJAWALI AUSINDO 973 Nov 97—7 Nov 97TRISETIA 972 Nov 97—10 Nov 97ELANG AUSINDO 9727 Oct 97—31 Oct 97FCP KAKADU III/9728 July 97—17 Aug 971996/970.214ALBATROSS AUSINDO 97-110 Jun 97—14 Jun 97KOOKABURRA 974 Jun 97—25 Jun 97NIGHT KOMODO 972 Jun 97—27 Jun 97CASSOWARY 97-121 April 97—28 Apr 97CASSAWARY 96-214 Jan 97—18 Jan 97ELANG AUSINDO 966 Dec 96- 13 Dec 97RAJAWALI AUSINDO 9622 Oct 96—31 Oct 96TRISETIA 9621 Oct 96—29 Oct 96NEW HORIZON VIII/9611 Jul 96—19 Jul 961995/960.293CASSOWARY 96-110 Jun 96—17 Jun 96NIGHT KOMODO 963 Jun 96—24 Jun 96KOOKABURRA 963 Jun 96—24 Jun 96CASSOWARY 95-220 nov 95—21 Nov 95ELANG AUSINDO18 Nov 95—25 Nov 95AUSINA 95-3**3 Nov 95—7 Nov 95RAJAWALI AUSINDO 9517 Oct 95—26 Oct 95KANGAROO 951 Aug 95—25 Aug 95NIGHT KOMODO 963 July 95—10 Jul 951994/950.188NIGHT KOMODO5 Jun 95—27 Jun 95OPERATION CENDERWASIH 951 May 95—4 Sep 95AUSINA 95-110 Apr 95—14 Apr 95FCP KAKADU 213 mar 95—31 Mar 95INDONEX6 Mar 95—13 Mar 95ELANG AUSINDO 949 Nov 94—14 Nov 94AUSINA PATROLEX 94-22 Nov 94—3 Nov 94AUSINA PATROLEX 94-127 Sep 94—4 Oct 94RAJAWALI AUSINDO 9414 Sep 94—21 Sep 94AUSINA 94-3**30 Aug 94—2 Sep 941993/940.086AUSINA 94-2**1 May 94—30 May 94NIGHT KOMODO17 Apr 94—7 May 94AUSINA 94-1**1 Apr 94—30 Apr 94ELANG AUSINDO1 Nov 93—30 Nov 93AUSINA PATROLEX 93-110 Jul 93—11 Jul 93* Budget estimate.** Passage exercise through Indonesia.(3) (a) (b) and (c) Tabled below are the aggregated and total costs associated with Australian Department of Defence training of Indonesian Armed Forces personnel from FY1988/89 to FY1998/99.Financial YearCost (AUDmillion)1998/99*3.381*1997/983.6171996/973.6311995/963.9341994/952.5811993/941.5411992/931.9131991/921.1781990/910.2021989/900.0071988/890.024* Budget estimate. (4) Tabled below is the aggregated and total cost of Australian Defence Cooperation with the Indonesian Armed Forces from FY1988/89 to FY1998/99.Financial YearCost (AUD million)1998/99*6.446*1997/985.3411996/975.4281995/966.0581994/954.2961993/942.4481992/933.0411991/921.8161990/910.5301989/900.2251988/890.713Total36.342* Budget estimate.4398(Question No. 443)4434398Brown, Sen BobSenator BrownQD4TASAG00 asked the Minister representing the Minister for Veterans' Affairs and the Minister Assisting the Minister for Defence, upon notice, on 8 March 1999:(1) Do the displays at the Australian War Memorial in Canberra represent all wars that Australians have been involved in since 1788.(2) Are there any displays representing the conflict between Aborigines and settlers which cost thousands of lives last century.(3) Given that hundreds of Aboriginal persons have served in the armed services in war-time, why are there no Aboriginal persons in the display at the War Memorial.4398Newman, Sen JocelynSenator NewmanBE4TASLPFamily and Community Services; Minister Assisting the Prime Minister for the Status of Women10—The Minister for Veterans' Affairs and the Minister Assisting the Minister for Defence has provided the following answer to the honourable senator's question:(1) Under its Act, the Australian War Memorial commemorates those who have died on or as a result of active service, or as a result of war or war-like operations in which Australians have been on active service. Based on this legislation and the intentions of its founders, the Memorial's commemorative activities focus on members of the Defence Forces who have served during times of external conflict in which Australia has been involved as a nation. These conflicts are represented in the Memorial's displays. Internal conflicts between Aboriginals and European settlers are outside the scope of the Memorial's mission.(2) In accordance with the above scope and mission, the Memorial commemorates those who have died on active service at times of national external conflict. While the conflict between Aboriginals and settlers is a significant part of Australia's history—and there is some reference to these events within the Memorial's displays dealing with the Colonial period—the events do not involve Australians on active service in external conflict and therefore fall outside the Memorial's commemorative function and purpose.(3) The Memorial displays do in fact present the contribution made by Aboriginal persons to Australia's defence. This is in keeping with the Memorial's policy of acknowledging the contributions made by all Australians to its national defence forces. There are specific examples in the Korean Gallery, where the medals and a portrait of Captain Reginald Saunders, the first Aboriginal soldier to be commissioned in the Australian Army, are on display. The newly opened Second World War gallery includes a portrait of Private Samuel Fejo, an Aboriginal member of the Militia, as well as stories of the experiences and contributions of Aboriginal Australians during the war, and a painting by Paddy Fordham Wainburrunga showing supply ships in Darwin. The Memorial's new Bradbury Aircraft Hall exhibition on air power in the Pacific, due to open next year, will present the story of Kittyhawk pilot Warrant Officer Len Waters. In addition to the displays in the galleries, the Memorial has developed and is touring the travelling exhibition Too Dark for the Light Horse. This exhibition presents 64 photographs that explore the contribution Aboriginals and Torres Strait Islanders have made to the defence of our nation from the South African War to the Vietnam conflict. After its display at the Memorial, the exhibition has been touring in two formats to city and country areas since 1997 and has been seen by over 120,000 people. Its tour has included remote Aboriginal communities in Arnhem Land and the Kimberleys, north-western and south-western Queensland and northern NSW. The Memorial's travelling exhibition program is considered to be an extremely important component of the Memorial's displays and is especially effective in reaching a wide audience.4399(Question No. 552)5524399Ray, Sen RobertSenator Robert RayUI4VICALP00 asked the Minister representing the Minister for Employment, Workplace Relations and Small Business, upon notice, on 11 March 1999.(1) What was the total expenditure on preparing the department for the move to accrual accounting for the 1997-98 financial year.(2) What was the departments's forecast for expenditure in this area.(3) (a) In which instances were firms or individuals engaged to provide consultancy services associated with the shift to accrual accounting by the department; and (b) which firms or individuals were engaged.(4) (a) What was the total number of days that consultants were engaged to provide this advice or services; (b) at what cost per day in each instance; and (c) what was the total cost of each consultancy in each instance.(5) (a) What is the estimated expenditure on outside consultants to advise on accrual accounting for the 1998-99 financial year; and (b) how much has been spent to date.(6) What is the estimated total departmental expenditure on preparing for accrual accounting for the 1998-99 financial year.4399Alston, Sen RichardSenator AlstonLD4VICLPCommunications, Information Technology and the Arts10—The Minister for Employment, Workplace Relations and Small Business has provided the following answer to the honourable senator's question:(1) Direct expenditure in 1997-1998 on preparing the department to move to accrual accounting totalled some $1.4 million, including costs relating to systems design and development, directly identifiable departmental employees and staff training. Integral to the implementation of accrual accounting was the department's decision to develop and implement a new integrated business information system (BIS) allowing significant process redesign in both financial and people resource processing and aimed at maximising the automation of processing functions in line with accepted best practice.(2) The original budget for the activities outlined in (1) was $3.06 million; the balance of funds was committed to the project in 1998-1999.(3) (a) and (b) The following consultancies were undertaken in 1997-98 by the firms indicated:* Pricewaterhouse Coopers for a Project Enhancement Scoping study and a quality assurance review;* Canberra Institute of Technology for provision of training in accrual accounting; and* SAP Australia for supply of the SAP R/3 BIS software, who engaged Deloitte & Touche Consulting ICS for implementation and development of the integrated BIS.(4) (a) * Pricewaterhouse Coopers—160 person days; * Canberra Institute of Technology—15 person days; * SAP Australia—a fixed contract (b) * Pricewaterhouse Coopers—$523 per day; * Canberra Institute of Technology—$1,000 per day; * SAP Australia—a fixed price contract.(c) * PricewaterhouseCoopers—a total cost of $83,750; * Canberra Institute of Technology—a total cost of $15,000; * SAP Australia—$2,136,900.(5) (a) The scope of the original BIS project has had to be significantly extended as a result of the department assuming responsibility for the employment function in October 1998. As a result, the total BIS project cost is now estimated as $4.476 million all of which is expected to be expended in 1998-1999. As mentioned above, the BIS has a wider application than simply accrual accounting but is essential for its development in the Department. It is not possible to apportion costs between the various BIS functions.(b) Expenditure for 1998-99, to 31 March 1999, totals $2.133 million for this project.(6) See 5(a) above.4399(Question No. 570)5704399Ray, Sen RobertSenator Robert RayUI4VICALP00 asked the Minister representing the Minister for Employment, Workplace Relations and Small Business, upon notice, on 11 March 1999:(1) What has been the total cost to the department in the 1997-98 financial year of legal advice obtained from the Attorney-General's Department.(2) What has been the total cost to the department in the 1997-98 financial year of legal advice obtained by the department from other sources.4400Alston, Sen RichardSenator AlstonLD4VICLPCommunications, Information Technology and the Arts10—The Minister for Employment, Workplace Relations and Small Business has provided the following answer to the honourable senator's questions:(1) The total cost to the department in the 1997-98 financial year of legal advice obtained from the Attorney-General's Department (including the Australian Government Solicitor) was $629,837.41. This figure does not include the costs of other legal services provided by the Attorney-General's Department, such as costs in relation to Commonwealth intervention in cases before the Australian Industrial Relations Commission and the Courts and costs in relation to the preparation of the Commonwealth's case in litigation in which the Commonwealth has been a party.(2) The total cost to the department in the 1997-98 financial year of legal advice obtained by the department from sources other than the Attorney-General's Department (and the Australian Government Solicitor) was $129,688.59. This figure does not include the costs of other legal services provided by these sources, such as costs in relation to Commonwealth intervention in cases before the Australian Industrial Relations Commission and the Courts and costs in relation to the preparation of the Commonwealth's case in litigation in which the Commonwealth has been a party.4400(Question No. 590)5904400O'Brien, Sen KerrySenator O'Brien8O6TASALP00 asked the Minister representing the Minister for Transport and Regional Services, upon notice, on 12 March 1999:(1) When did Airservices Australia receive a Bureau of Air Safety Investigation (BASI) report titled "Systematic Investigation into Factors Underlying Air Safety Occurrences in Sydney Terminal Area Airspace".(2) What action did Airservices Australia take in response to BASI concerns about the use of runway 25 with cross winds of up to 25 knots contained in that report.(3) When did the Civil Aviation Safety Authority (CASA) receive this BASI report and what action CASA take in response to BASI concerns about the use of runway 25 with cross winds of up to 25 knots4400Macdonald, Sen IanSenator Ian MacdonaldYW4QLDLPRegional Services, Territories and Local Government10—The Minister for Transport and Regional Services has provided the following answer to the honourable senator's question:(1) 18 August 1998.(2) Airservices Australia advises that it conducted an extensive review of International Civil Aviation Organisation (ICAO) and domestic standards and guidance for the use of runways in cross wind conditions.Airservices Australia analysed its internal procedures for nomination of runways in cross wind conditions and determined that the procedures relating to the use of runways with cross wind up to 25 knots were acceptable.Airservices Australia also advises that it provided support and relevant information and data to the Civil Aviation Safety Authority (CASA) to assist in its analysis of the practice. Airservices Australia has accorded with the findings of CASA.(3) 18 August 1998. CASA advises that it has reviewed the Airservices practice of operating with up to 25 knots of crosswind at Sydney airport. As a result of this review, CASA considers that the practice of routinely operating runways with up to 25 knots of crosswind before initiating a change of nominated runway does not pose an unacceptable safety hazard. However, it should be noted that the pilot-in-command always has the discretion to reject the nominated runway in favour of another for safety reasons.