House of Representatives
16 August 1977

30th Parliament · 2nd Session



Mr SPEAKER (Rt Hon. B. M. Snedden, Q.C.) took the chair at 2.15 p.m., and read prayers.

page 1

DEATH OF PRESIDENT MAKARIOS

Mr MALCOLM FRASER:
Prime Minister · Wannon · LP

- Mr Speaker, it is with deep regret that I inform the House of the death on 3 August 1977 of His Beatitude Archbishop Makarios III, President of the Republic of Cyprus. I move:

Mr Speaker, following the news of the death of President Makarios, the Governor-General and I sent messages of condolence to the Acting President of the Republic of Cyprus and the Minister of Foreign Affairs of the Republic. The Australian Government was represented at the President’s funeral by the Minister for Immigration and Ethnic Affairs (Mr MacKellar). The Leader of the Opposition (Mr E. G. Whitlam) and our High Commissioner to the Republic of Cyprus were also present.

The late President was the inspiration of the modern state of Cyprus and represented it in the world community with wisdom and distinction.

He was ordained deacon and priest in 1938. He graduated from the School of Theology of Athens University and he continued his theological studies at Boston University on a World Council of Churches scholarship. On his return to Cyprus in 1948 he was consecrated bishop and began intensive religious, social and national work in his see. At that time he began his vigorous campaign for nationhood for Cyprus. In 1950 he was elected as both archbishop and ethnarch national leader of the Greek people of Cyprus. It is a tribute to his qualities that he was elected as both the spiritual and the political leader of his country.

In 1952 he began his campaign at the United Nations General Assembly for international recognition of Cyprus. During the following years of the decade he fought courageously to achieve his goal, enduring even exile from his country. Following the London agreement in 1959 that Cyprus would become an independent republic, he returned to Cyprus and was elected its first President. President Makarios played a unique and distinguished role in his country’s national and international affairs. He visited many countries in his quest for a solution to the problems of Cyprus. He tirelessly represented his country at many international conferences as well as at the United Nations and at meetings of Commonwealth Heads of Government. His remarkable personal qualtities earned him an eminent place amongst world statesmen. His counsels will be particularly missed at Commonwealth Heads of Government meetings, in which he had actively participated for many years. I had the honour of meeting with him privately during the recent Commonwealth Heads of Government meeting in London. At that time we discussed his forthcoming state visit to Australia in November this year. This visit would have been a fitting symbol of the development of long-standing and excellent relations between our two countries. I am sure that not only the Australian Government but all the Australian people were looking forward to that visit. I am sure that not only those Australians whose country of origin is Cyprus but all others will share my regret that it cannot now take place.

We therefore wish to record in the Parliament our deep sympathy to the people of Cyprus. They have lost a statesman of great eminence who had long personified his people’s quest for identity and independence. We also hope that the search for a peaceful and lasting solution to the problems in Cyprus, to which the late President had devoted so much of his life, will be pursued with determination despite his untimely death.

Mr E G Whitlam:
Leader of the Opposition · WERRIWA, NEW SOUTH WALES · ALP

-Seventeen years ago today the Republic of Cyprus came into being. The Archbishop and Ethnarch of Cyprus became the founding President. He was the first head of an independent Cyprus since the Lusignan kingdom passed to Venice nearly five centuries ago.

By April 1975, when the Commonwealth Heads of Government met in Jamaica, the President had become their doyen. Thus it was that when we assembled on HMY Britannia, Makarios III sat at the right hand of Elizabeth II, whose British Government 20 years earlier had relegated him to the Seychelles. None who witnessed that tableau could fail to reflect on its personal and historical significance and symbolism. It said much about this remarkable man and much about the Commonwealth itself. Through strength of will and courage he attained and maintained his eminence in the Commonwealth and in the ranks of world statesmanship; and, not for the only time in the history of the Commonwealth, exile or imprisonment confirmed its victim’s claims to the leadership of an independent nation.

President Makarios supported the Commonwealth and the Commonwealth supported

Cyprus. I was happy to play some part in drafting the Commonwealth’s expression of support for the General Assembly and Security Council resolutions calling for the speedy withdrawal of all foreign armed forces, and in the Commonwealth’s establishment of a committee, which included Australia, to follow developments in Cyprus and to assist in every possible way towards the early implementation of the United Nations resolutions.

Six years ago in Nicosia the President told me of his interest in the tens of thousands of Cypriots who had settled in Australia and his appreciation of the work of the Australian police, then drawn from both Federal and State forces, who were part of the United Nations peace-keeping force. In Jamaica he expressed warm gratitude for the Australian Government’s response to the human disaster and material devastation caused by the Turkish invasion. He promptly responded to my invitation that he should visit Australia. In London last June I found that he was still greatly looking forward to the visit.

For 3000 years of recorded history Cyprus has been at the strategic and commercial crossroads of the Eastern Mediterranean. President Makarios represented the new political independence of Cyprus; but he also embodied its ancient spiritual independence, for when Michael Mouskos, son of a peasant, became Archbishop and thus Ethnarch in 1950, at the age of 37, he assumed the imperial prerogatives which were accorded the head of the Orthodox Church in Cyprus when it was made autocephalous just 1 500 years ago. He was indeed the first Christian prelate to hold great political office under the English Crown since Cardinal Wolsey No reckoning of Archbishop Makarios ‘s career, and his hold on the loyalties of the people of his nation and his faith, can be complete without recognition of his dual role- head of his nation, head of his church. The depth of his people’s devotion had to be witnessed to be believed in the stricken capital and all along the long roads to his grave on the mountain top above the monastery where he was trained for his mission in life. There can be no doubt of the veneration and affection in which he has been long held and will continue to be held by hundreds of thousands of Greek speaking residents of Australia herself.

Among all his personal qualities he possessed physical and political courage of the highest order. There were at least a dozen attempts on his life. The most heinous was on 15 July 1974 when the Greek military government promoted the xpa£ix@icriiia against him. On 20 July, Turkey invaded. On 23 July the Greek dictatorship fell. We might wish, sic semper tyrannis. Greece herself is now rapidly recovering from the policies of the tyrants; the people of Cyprus however, Greek and Turkish alike, still suffer from them. The intervention of the colonels raised fears among Turks in both Cyprus and Turkey. It caused, but did not justify, the occupation which still continues.

It is a tragedy of the highest order that Cyprus should lose her chief at this time of continuing difficulty and danger. The ranks of world statesmanship are diminished by his early death; so are the ranks of the Commonwealth. But the greatest loss, seemingly irreparable, is the loss to the people of Cyprus of the man who founded and preserved their state and symbolised the church, the nation and the state of Cyprus throughout the world.

Mr YATES:
Holt

-I wish to speak on behalf of the many electors in the Melbourne area and elsewhere who were born in Cyprus. Because in 1952 I lived in Lapithos which is now under Turkish control in Cyprus and because of my association with the foundation of the early Committee of Conciliation headed by Mr Atlee, Compton McKenzie, Robert Boothby and others who were involved in the earliest days looking for a peace between Turkey, Great Britain and Greece, I feel it would be wrong if I did not today, having known and having worked with Archbishop Makarios, Francis Noel Baker and others, say a few words in this honourable House on this motion. There is absolutely no doubt about the complete and amazing bravery of Archbishop Makarios. At all times, his stand was firm, correct and even humble.

Last year I visited the Commonwealth Police unit in Cyprus. This unit is doing a wonderful job for our nation. These police officers wander around unarmed. They travel in landrovers. They wander between the two sides. They are most respected and understood in Cyrpus. The unit has brought a great deal of skill to the problem of the preservation of peace in Cyprus. I would not like to let this moment pass without saying to the nation that the Australian Commonwealth Police unit in Cyprus has rendered invaluable service to the cause of world peace. This fact has been recognised by every person who works in or is concerned with international affairs or the United Nations.

To his people, the passing of Archbishop Makarios is the most terrible tragedy as it has occurred at a time when one third of their island is at present occupied and is considered to be part of a Turkish province. Last year, for the first time, the government car carrying the Australian High Commissioner in Cyprus was not permitted to enter into the area where a conference between Greek and Turkish Cypriot people and their rulers was being held. That was a sad event. If Cyprus is to have any hope of peace or any hope of a future there must be communications between the Turkish Cypriots and the Greek Cypriots.

In all his dealings with Dr Denktash, Mr Orekx, and Dr Kutchuk, the former VicePresident of Cyprus, Archbishop Makarios always maintained a firm and humble way in his negotiations. That Cyprus, the Middle East, the Commonwealth and the world have lost a statesman of this standing is a matter of the most important regret. On behalf of those who have been involved throughout their lives in negotiations with Turkish Cypriots and Greek Cypriots and with their governments, and also on behalf of all Cypriots living in Australia. I acknowledge, having lived in Cyprus, that Archbishop Makarios was one of the world’s greatest leaders. He was, at a difficult time, the most patient statesman. I am sorry that, before he was able to visit this country, his life on this earth ended. I only hope that there will arise in Cyprus a leader of equal competence, equal brilliance and equal good sense to hold together a community of church and state. For that reason I associate myself and all Cypriots whom I know in Australia, New York and elsewhere with the motion moved by the Prime Minister (Mr Malcolm Fraser) and supported by the Leader of the Opposition ( Mr E. G. Whitlam 1

Mr INNES:
Melbourne

-I rise to add my condolences on the passing of President Makarios, a great world figure. Cyprus, to many of us, is a far away country but we must remember that it has played a part in English history and, more importantly, it has given a strand to the Australian character. The contributions of Cypriots need no mention on an occasion such as this. They, like me, regret the passing of such a great man. The British had two contacts with Cyprus. In 1191 Richard the Lionheart conquered Cyprus for 80 days. The second British occupation began in 1878 and lasted for 80 years. The first contact put an end to an independent Cyprus; the second came to an end by an agreement which established an independent Cyprus. Credit for that goes to the man we mourn today. Whatever his detractors may say, the Archbishop proved himself a consummate politician. He presided over the full spectrum of political life, stretching from the extreme Right to the extreme Left.

He refused to repress any political orientation and, for a short time, he paid for his generosity. The main theme of his life was collaboration for the common good. The Christian faith moulded his character and gave him the character we so admired. He was a man of the people; a broadminded, modern man whose experience of life was varied. He always stressed that he was firstly an archbishop and secondly a head of state. That broadmindedness was founded on the cornerstone of what he described as his Christianity. He was born in 1913, the son of a part farmer, part shepherd in the Troodos Mountains. He grew up helping his father in the fields. But he grew up in the shadow of the Orthodox church because near his village he could see the clock tower of Kykko a famous monastery. His uncle was a priest. He helped his uncle prepare the mass and in painting the church. Finally, he became a monk. He was sent to complete his studies at the most famous school in Cyprus, namely, the Pansprian Gymnasium in Nicosia.

His Beatitude, the President, did not spare himself in the struggle to free the Cypriot people from the yoke of oppression. He was tireless in demanding that the United Nations’ decisions on Cyprus be implemented and that the principle contained in those decisions be made the basis of a negotiated settlement. He worked for a formula which would safeguard the independent sovereignty, territorial integrity and nonalignment of the Republic of Cyprus. It was my pleasure to be received by the late President on two occasions. His strength of character, sharpness of mind and dedication to the cause of a united Cyprus came through in a way which stamped him as a great patriot. I am sure that every Australian and particularly the members of this Parliament will join with me in expressing the view that the cause for which His Beatitude lived and for which he gave his life- a just and lasting peace for a united Cyprus based on the resolutions of the United Nations- will be achieved and will be a lasting tribute to his memory. I support the motion moved by the Prime Minister (Mr Malcolm Fraser).

Question resolved in the affirmative, honourable members standing in their places.

page 4

DEATHS OF FORMER SENATORS AND MEMBER

Mr SPEAKER:

– I inform the House of the deaths of the Hon. Hattil Spencer Foil, a former senator and Minister, Mr Edgar Wylie Prowse and Mr Theophilus Martin Nicholls, former senators, and Sir Archibald Grenfell Price. Mr Foil who died on 7 July 1977 represented the

State of Queensland from 1917 to 1947 and was a Minister of the Crown between 1 93 7 and 1 94 1 . Mr Prowse, who died on 2 June 1977, represented the State of Western Australia from 1962 to 1973. Mr Nicholls, who died on 22 July 1977, represented the State of South Australia from 1944 to 1968. Sir Archibald, who died on 20 July 1 977, was a member of this House for the Division of Boothby from 1941 to 1943. As a mark of respect to the memory of the deceased, I invite honourable members to rise in their places.

Honourable members having stood in their places-

Mr SPEAKER:

– I thank the House.

page 4

PETITIONS

The Clerk:

– Petitions have been lodged for presentation as follows and copies will be referred to the appropriate Ministers:

Broadcasting and Television

To the Honourable the Speaker and members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:

That because television and radio

  1. a ) affect our social and moral environment,
  2. are family media watched and heard by many children at all times, and
  3. present too much explicit violence and sex they therefore need stronger control than other media and the existing standards need stricter enforcement in both national and commercial sectors.

Your petitioners therefore humbly pray:

That the Australian Government will amend the Broadcasting and Television Act, in relation to both national and commercial broadcasters, to legislate

  1. for adequate and comprehensive programs in the best interests of the general public,
  2. against self-regulation by the broadcasting and television industry,
  3. for an independent consumer body to represent the best interests of the general public, and
  4. for immediate and effective penalties to be imposed for breaches of program and advertising standards.

And your petitioners as in duty bound will ever pray. by Mr Abel, Mr Adermann, Mr Baillieu, Mr Brown, Mr Kevin Cairns, Mr Dobie, Mr Falconer, Mr Giles, Mr Gillard, Mr Hayden, Mr Howard, Mr Peter Johnson, Mr Jull, Mr Killen, Dr Klugman, Mr Lucock, Mr Peacock, Mr Ruddock, Mr Simon, Mr Staley, Mr Wallis, Mr Wilson and Mr Yates.

Petitions received.

Australian Association for Better Hearing

To the Honourable the Speaker and members of the House of Representatives in Parliament assembled.

The humble petition of certain members of the Australian Association for Better Hearing, and other citizens of

Australia, respectfully showeth that a financial burden is imposed on hearing impaired members of the public in that the special telephone equipment, which is essential for such hearing impaired citizens to make telephonic communication, is subject to installation costs and rental charges.

Your petitioners therefore humbly pray that the Federal Government give every consideration to waiving the installation costs and rental charges of the special telephone equipment required by hearing impaired members of the public

And your petitioners as in duty bound will ever pray. by Mr Gilford, Mr Graham, Mr Howard, Mr

McLean and Mr Scholes.

Petitions received.

Public Libraries

To the Honourable the Speaker and members of the House of Representatives of the Commonwealth of Australia in Parliament assembled.

The petition of the undersigned citizens of Australia respectfully showeth ‘That the public library services of New South Wales are inadequate both in quality and quantity and that the burden of provision is placed too heavily upon local government’.

Your petitioners therefore humbly pray that your Honourable House will ensure the implementation of the recommendations of the Report of the Committee of Inquiry into Public Libraries as a matter of urgency.

And your petitioners as in duty bound will ever pray. by Mr O’Keefe, Mr Lucock, Mr Viner and Mr

Wilson

Petitions received.

Pensions

To the Honourable Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth:

That the delays between the announcements of each quarterly movement in the Consumer Price Index and their application as a percentage increase in age and invalid pensions is excessive, unnecessary, discriminatory and a cause of economic distress.

That proposals to amend the Consumer Price Index by eliminating particular items from the Index could adversely affect the value of future increases in aged and invalid pensions and thus be a cause of additional economic hardship to pensioners.

The foregoing facts impel your petitioners to ask the Australian Government as a matter of urgency to:

  1. Require each quarterly percentage increase in the Consumer Price Index to be applied to age and invalid and similar pensions as from the pension pay day nearest following the date of announcement of the CPI movement.
  2. Give an open assurance to all aged and invalid pensioners that any revision of the items comprising the Consumer Price Index will in no way result in reductions in the value of any future entitlements to pensioners.

And your petitioners as in duty bound will ever pray. by Mr Bourchier, Mr Falconer and Mr Simon.

Petitions received.

Nursing Home Subsidies

To the Honourable the Speaker and Members of the House of Representatives assembled. The petition of the undersigned citizens of Australia respectfully showeth:

That many pensioners who are holders of the Pensioners Health Benefit Card, have suffered undue hardship as inmates of private nursing homes, because the Federal Government subsidy was insufficient to meet the charges as laid down.

Many pensioners whose spouse was an inmate of the private nursing homes suffered poverty in an endeavour to sustain their partner while in the nursing home.

Only in rare cases was the statutory minimum patient contribution as laid down adhered to.

That the telephone was a matter of life and death to many pensioners, but because of the cost of installation of the telephone many are unable to afford the installation.

That those pensioners who have only their pension and very little else tolive on and are forced to pay high rents, are in many cases living in extreme poverty.

The foregoing facts impel your petitioners to ask the Australian Government as a matter of urgency to:

  1. Make sure that subsidies paid to private nursing homes are such that each pensioner holding a Pensioners Health Benefit Card will pay the private nursing home no more than the statutory minimum patient contribution, which will allow six dollars per week to be retained by the pensioner patient for their personal use.
  2. That a pensioner holding a Pensioner Health Benefit Card shall have a telephone installed free of charge, or at a very nominal charge.
  3. That those pensioners who have only their pension and very little else to live on, shall receive a subsidy to assist them. The subsidy to be governed by a Means Test.

And your petitioners as in duty bound will ever pray. by Mr Hunt, Mr Les McMahon and Mr

Sullivan

Petitions received.

Whaling

To the Honourable Speaker and Members of the House of Representatives assembled. The humble petition of the undersigned citizens of Australia respectfully show us:

That due to the new information on whale communication, behaviour and intelligence, and to the depleted state of most of the great whale stocks and the uncertainty associated with whale population estimates, that commercial whaling is no longer acceptable to the vast majority of Australians. It is urged that immediate steps be taken to end this activity.

And your petitioners as in duty bound will ever pray. by Mr Brown and Mr Dobie.

Petitions received.

Private Hospital and Nursing Home Subsidies

To the Honourable the Speaker and the Members of the House of Representatives in Parliament assembled.

The humble petition of the undersigned concerned citizens respectfully showeth:

  1. We, the undersigned, urge the Federal Government NOT to withdraw the Private Hospital and Nursing Home subsidies that are currently contributing $ 1 6.00 a day and up to $17.65 a day towards Hospitalisation costs.
  2. As we are already paying for the subsidies through our taxes, we consider it an imposition for us to be obliged to meet these costs through higher health fund contributions.

And your petitioners as in duty bound will ever pray. byMrHolten.

Petition received.

Private Hospital and Nursing Home Subsidies

To the Right Honourable the Speaker and Members of the House of Representatives in Parliament assembled:

The humble Petition of the undersigned citizens of the electorate of Gippsland respectfully showeth:

That it is reported that the Federal Government is currently considering withdrawing its subsidy of $1 6.00 per day for all private hospital patients.

It is also considering withdrawing various nursing home subsidies for privately insured patients.

Your petitioners therefore humbly pray that the House of Representatives in Parliament assembled should ensure that the current subsidy of $16.00 per day for all private hospital patients and the current nursing home subsidies should remain in force in order that they continue to alleviate the hardship to the people of Australia.

And your petitioners as in duty bound will ever pray. by Mr Nixon.

Petition received.

Refugees from South Africa

To the Right Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned concerned citizens of Australia respectfully showeth that:

  1. . On16 June1976, when the students of Soweto township in South Africa demonstrated peacefully, many hundreds were shot down.
  2. Since that date the people of Soweto and of South Africa in general have continued to protest at the denial of human rights and at the terrible conditions to which they are subjected by the white minority government.
  3. In consequence of the savage repression suffered by the African, Coloredand other oppressed people in South Africa, thousands have been forced to flee across the borders into such neighbouring states as Botswana and Mozambique.

We, your petitioners humbly pray that the Government take immediate steps to provide humanitarian aid to the refugees from South Africa, in particular by providing funds for the supply of clothing, medical supplies, etc. scholarships and transport costs to enable student refugees to continue their education in Australia.

And your petitioners as in duty bound will ever pray. by Mr Jacobi and Mr Wilson.

Petitions received.

Medical Benefits Schedule: Abortion Claims

To the Honourable the Speaker and members of the House of Representatives in Parliament assembled:

The humble petition of the undersigned citizens of Australia respectfully showeth that abortion has become a multi-million dollar business in Australia in spite of the fact that the Medical Practice Clarification Bill1973 was overwhelmingly defeated.

The multi-national giant, Population Services International, which operates in Sydney is now expanding its business to include Canberra.

In1976 alone, over 46 000 abortions were being paid for under the existing Medical Benefits Schedule which stipulates the benefit payable for Medical Services under both Medibank and the Private Health Insurance Funds.

Item No. 6469- ‘The evacuation of the contents of a gravid uterus by curettage and suction curettage’ now attracts a benefit of $65.00. In 1976 close to $5m were spent to destroy unborn children.

Under the ‘abortion item’ No. 6469 abortion-on-demand is now being paid for from public monies, i.e. contributions to the existing Health Funds.

Your petitioners therefore humbly pray that the Government takes action

  1. to stop payments of abortion claims under Item No. 6469 of the Medical Benefits Schedule except in the case that the abortion has been carried out in a hospital and it being a certified medical procedure of preventing the death of the mother;
  2. to stop the funding and operation of any so-called pregnancy help service or health centre which offers abortionondemand;
  3. to financially assist those pregnancy help services which provide genuine support to both mothers and their unborn children.

And your petitioners as in duty bound will ever pray. by Mr Malcolm Fraser.

Petition received.

Private Hospital and Nursing Home Subsidies

To the Honourable the Speaker and the Members of the House of Representatives in Parliament assembled:

The humble petition of the undersigned concerned citizens respectfully showeth:

  1. We, the undersigned, urge the Federal Government NOT to withdraw the Private Hospital subsidy that is currently contributing $16.00 a day towards hospitalisation costs. We further urge the Government to reverse its decision to withdraw the Nursing Home subsidy as from 1 October 1977.
  2. As we are already paying for the subsidies through our taxes, we consider it an imposition for us to be obliged to meet these costs through higher health fund contributions.
  3. We also request the immediate re-introduction of income tax concessions in respect of health insurance contributions.

And your petitioners as in duty bound will ever pray. byMrAldred.

Petition received.

Tertiary Education

To the Honourable Speaker and Members of the House of Representatives in Parliament Assembled. The petition of the undersigned students, parents, teachers and citizens of Australia respectfully showeth:

That the decision of the Government to withdraw all forms of financial assistance to students of non-State tertiary institutions in the main, business colleges, is in total conflict with stated Government education policy.

The decision will result in a shortage of places for training secretarial and clerical students and an inordinate demand upon the State Government technical education systems.

At a time of severe economic disruption, this action must lead to an unnecessary worsening of the current employment situation for school leavers.

Your petitioners, therefore, humbly pray that the Commonwealth Government will act immediately to reverse its decision.

And your petitioners as in duty bound will ever pray. by Mr Lionel Bowen.

Petition received.

Television

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled:

The humble petition of the undersigned citizens of Australia respectfully showeth that:

  1. transmission of ABC television in the Derwent Valley district, Tasmania, is poor and
  2. reception could be improved by the installation of a repeater station on Mount Belcher or alternatively on Marriot’s Lookout, Tyenna, Tasmania.

Your petitioners therefore humbly pray that a repeater station be installed on Mount Belcher or Marriot’s Lookout, Tyenna, Tasmania, to improve the reception of ABC television in the Derwent Valley district, Tasmania.

And your petitioners as in duty bound will ever pray. by Mr Burr.

Petition received.

Australian Broadcasting Commission

To the Honourable the Speaker and Members of the House of Representatives, in Parliament assembled:

We, the undersigned citizens of the Commonwealth do humbly pray that the Commonwealth Government:

  1. Subscribe to the view that the Australian Broadcasting Commission belongs to the people and not to the government of the day whatever political party.
  2. Eschew all means, direct or indirect, of diminishing the independence of the Australian Broadcasting Commission.
  3. Reject all proposals for the introduction of advertising into ABC programmes.
  4. Develop methods for publicly funding the Commission which will prevent the granting or withdrawing of funds being used as a method of diminishing its independence.
  5. Ensure that any general enquiries into broadcasting in Australia which may seem desirable from time to time shall be conducted publicly and that strong representation of the public shall be included within the body conducting the enquiry.

And your petitioners as in duty bound will ever pray. by Mr Cohen.

Petition received.

Pensions

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled, the petition of the undersigned citizens of Australia respectfully showeth:

That distress is being caused to social security recipients by the delay in adjusting pensions to the Consumer Prices Index months after prices of goods and services have risen, and that medications which were formerly pharmaceutical benefits must now be paid for.

Additionally, that State housing authorities’ waiting lists for low rental dwellings for pensioners grow ever longer, and the cost of funerals increase ever greater.

Your petitioners call on the Australian Government as a matter of urgency to:

Adjust social security payments instantly and automatically when the quarterly Consumer Prices Index is announced.

Restore pharmaceutical benefits deleted from the free list.

Update the State Grants (Dwellings for Pensioners) Act of 1974, eroded by inflation, to increase grants to overcome the backlog.

Update Funeral Benefit to 60 per cent of reasonable cost of funeral. (This benefit was 200 shillings, 20 dollars, when introduced in 1943. It was seven times the 1943 pension of 27 shillings a week).

And your petitioners as in duty bound will ever pray. byMrDobie.

Petition received.

Abortions

To the honourable Speaker, and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of the Commonwealth humbly showeth that the undersigned are deeply concerned:

That abortion is the destruction of innocent human life.

That on 10 May1973, the House of Representatives overwhelmingly rejected the Medical Practices Clarification Bill which sought to legalise abortion on demand in the Territories controlled by the Federal Government.

That the Legislative Assembly in Canberra should consult Parliament again before discussing and debating the opening and operations of Population Services International and Preterm Foundation in Canberra.

That the situation regarding abortions in the Australian Capital Territory is the same as that in New South Wales where the statute prohibits abortion but allows a defence.

That the situation in Australian Capital Territory has a great impact on situations in the States.

Your petitioners humbly pray.

That the Federal Government will act immediately to prevent the establishment and/or operation of Population Services International and other private clinics in the Australian Capital Territory.

That taxpayers’ money may not be used, through Medibank, to finance abortions.

And your petitioners as in duty bound will ever pray. byMrHolten.

Petition received.

Compulsory Retirement of Australian Government Employees

To the Right Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The Petition of the undersigned citizens of Australia respectfully showeth:

That Australian Government Employees strenuously oppose the provisions of the Commonwealth Employees (Redeployment and Retirement) Bill first introduced in the

House of Representatives on December 8th, 1976. The basis for opposition includes the following reasons:

  1. The grounds constituting’ due cause’ for termination of services of tenured staff are expanded beyond those already available in existing legislation thereby introducing subjective discretionary powers which are inconsistent with career service expectations and entitlements;
  2. The Bill relegates to subordinate legislation or administrative direction matters affecting substantive rights of employees including the scale of compensation, the composition and powers of the appellate tribunal, and the criteria upon which services may be terminated.
  3. Existing rights of reinstatement in tenured employment are abrogated by the Bill;
  4. Agreement has not been reached on a number of matters which should have been finalised before any attempt to introduce legislation. These include: an arbitral determination on redundancy arrangements; benefits; procedures.
  5. As currently drafted the Bill over-rides entitlements under Arbitration awards.

Your Petitioners most humbly pray that the House of Representatives, in Parliament assembled, should reject passage of any legislation to extend powers of compulsory retirement of Australian Government employees unless and until any variation has been agreed with staff representatives.

And your petitioners as in duty bound will ever pray. byMrInnes.

Petition received.

Mr Ignazio Salemi

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We the undersigned citizens of Australia do humbly pray that the Commonwealth Government will permit Mr Ignazio Salemi to remain in Australia as a resident.

The petition of the undersigned respectfully showeth:

  1. That whereas an amnesty was announced for all illegal migrants and that whereas Mr Ignazio Salemi, an applicant for amnesty, has been denied amnesty.
  2. That Mr Salemi fulfils all the publicly announced criteria for amnesty.
  3. That a decision of six judges of the High Court of Australia recognises that the Minister for Immigration and Ethnic Affairs may exercise a discretion to allow Ignazio Salemi to remain in Australia.
  4. That, although denying Salemi ‘s appeal, all six judges of the High Court agreed that he had been unfairly treated.

And your petitioners as in duty bound will ever pray. by Mr Innes.

Petition received.

Governor-General

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:

That although we accept the verdict of the Australian people in the 1975 election, we do not accept the right of a Governor-General to dismiss a Prime Minister who maintains the confidence of the House of Representatives.

We believe that the continued presence of Sir John Kerr as Governor-General is a cause of division among the Australian people.

Your petitioners therefore humbly pray that your honourable House will call on Sir John Kerr to resign as Australian Governor-General.

And your petitioners as in duty bound will ever pray. by Mr Morris.

Petition received.

Estate Duty

To the Right Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of the electorate of McMillan respectfully showeth:

  1. That there are an increasing number of electors throughout Australia concerned to abolish Probate and Estate Duties imposed by the Commonwealth Government of Australia and the respective State Governments.
  2. That it may not be possible to forthwith abolish Estate Duty because of the current economic situation.

Your petitioners therefore humbly pray that the House of Representatives in Parliament assembled should ensure that the incidence of Estate Duty be phased out commencing in the financial year 1977-78 and be finally abolished within five years or such earlier date as reasonably possible.

And your petitioners as in duty bound will ever pray. by Mr Simon.

Petition received.

Australian Government Employees: Remote Locality Leave

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The Petition of the undersigned citizens of Australia respectfully showeth:

That Australian Government Employees strenuously oppose the Public Service Board’s decision to remove the provision for remote locality leave in Cairns.

The basis for opposition includes the following reasons:

  1. State Government, Banks, Municipal Officers, Journalists and numerous others are entitled to extra days leave on remote locality basis.
  2. Cairns is isolated socially, geographically, educationally and culturally.
  3. Cairns is also disadvantaged by freight costs; medical services and media coverage inadequate in comparison to Southern Areas.
  4. All these contribute to a real reduction in the quality of life in Cairns. The small compensation for this reduction in the quality of life is being removed by the Public Service Board.

Your Petitioners most humbly pray that the honourable member represent this matter with the Government and the Public Service Board so that their decision regarding Cairns be cancelled. Also that moves be made for leave provisions to be granted in line with neighbouring towns in your electorate i.e. Mareeba, Atherton, Mossman and Innisfail.

And your petitioners as in duty bound will ever pray. by Mr Thomson.

Petition received.

Uranium

To the Honourable the Speaker and Members of the House of Representative assembled. The humble petition of the undersigned residents of Australia respectfully showeth that:

In consideration of all information to this time of the hazards of large scale nuclear power generation; we request that the Australian Government declare a moratorium on the mining and export of Australian uranium in order to allow the citizens of Australia to give full consideration to the issue of development of nuclear energy, in line with the recommendations of the Fox Report for a national debate; and we request the urgent development of a national energy policy that seeks the conservation of energy and the development of alternative energy sources.

And your petitioners as in duty bound will ever pray. by Mr Antony Whitlam.

Petition received.

Unemployment Benefits

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble Petition of the undersigned electors of the Division of Sturt respectfully showeth: that they are greatly concerned about the fact that so many people, including such a large number of young people, are receiving Unemployment Benefits without any condition except that they are not able to find suitable employment.

Your Petitioners therefore pray that Parliament give consideration to the suggestion that, to enable individuals to maintain their self-respect and dignity as human beings, and for the good of the community at large, the provision of Unemployment Benefits carry the requirement that the recipient of such benefit be available to service to the community for a time equal to that which would produce a similar return at minimum wage rate.

And your petitioners as in duty bound will ever pray. by Mr Wilson.

Petition received.

page 9

APPOINTMENT OF GOVERNOR-GENERAL

Mr MALCOLM FRASER:
Prime Minister · WANNON, VICTORIA · LP

– I inform the House that Her Majesty the Queen has graciously approved the appointment of Sir Zelman Cowen, C.M.G. Q.C. as Governor-General to succeed Sir John Kerr. Sir Zelman will take up his appointment when Sir John relinquishes office in December.

page 9

MINISTERIAL ARRANGEMENTS

Mr MALCOLM FRASER:
Prime Minister · Wannon · LP

– I inform the House that a new Department of the Special Trade Negotiator was created on 17 July 1977 and that the Honourable John Howard has been appointed Minister for Special Trade Negotiations. Mr Howard will continue as Minister assisting the Prime Minister. The Honourable Wal Fife has been appointed Minister for Business and Consumer Affairs. The Minister for Special Trade Negotiations will be represented in the Senate by the Minister for Industry and Commerce, Senator Cotton, and the Minister for Veteran’s Affairs, Senator Durack, will continue to represent the Minister for Business and Consumer Affairs.

I also inform the House that the AttorneyGeneral, Mr Ellicott, left Australia on 14 August to attend the Commonwealth Law Ministers’ Conference in Canada and to have discussions in Washington and London. He is expected to return on 4 September. During his absence the Minister for Veterans’ Affairs, Senator Durack, will act as Attorney-General and the Minister for Special Trade Negotiations, Mr Howard, will represent the Attorney-General in this House.

page 9

QUESTION

QUESTIONS WITHOUT NOTICE

page 9

QUESTION

PECUNIARY INTERESTS OF MEMBERS OF PARLIAMENT AND PUBLIC SERVANTS

Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP

– I direct a question to the Prime Minister. In the first question time in this Parliament I asked him whether the Government intends to proceed to implement the unanimous report of the Joint Committee on Pecuniary Interests of Members of Parliament, whose members were drawn from both sides of both Houses in the last Parliament and whose report had been presented to both Houses on 30 September 1975. In particular I asked whether he had requested his Ministers to make declarations of interest which that Committee recommended they should make. He may remember that he replied that all Ministers had been asked to make declarations to him and that the recommendations of the Committee were taken into account in formulating that requirement. I now ask him whether the Minister for Primary Industry informed him of the full nature of his financial interests and responsibilities which have now been discussed in the media and how long ago that Minister first informed him of the changes in shareholdings and directorships flowing from changed family responsibilities? May I also ask him again whether the Government intends to implement the recommendations in the report?

Mr MALCOLM FRASER:
LP

-The honourable gentleman has referred to a number of matters. So far as the parliamentary Committee’s report is concerned, the honourable gentleman will know also that some recommendations were contained in the report of the Royal Commission on Public Administration which in a related way covers the Public Service. At the moment an interdepartmental committee is looking at the

Royal Commission’s recommendations and at the parliamentary Committee’s recommendations to see to what extent they are compatible with each other so that the Government may be in a position to make a decision on the overall question of pecuniary interests in relation not only to parliamentarians but also to public servants. The honourable gentleman will be aware that it is not uncommon practice in a number of countries for public servants to be in a position of making statements concerning their pecuniary interests. It seemed to the Government that it would be sensible to proceed in parallel in the two areas- politicians and public servantsbecause obviously decisions relating to one would have significant implications on decisions relating to the other. In case the letter itself has not been tabled in the Parliament- my recollection is that it may have been- I am perfectly happy to table a copy of a letter that I wrote to all Ministers and to all later appointed Ministers to indicate the nature of the statement that is required of them. I will also table the covering letter to the Minister for Administrative Services who has the responsibility of seeing that ministerial staffs fulfil this same kind of commitment.

The Minister for Primary Industry has made declarations, as have other Ministers, and I have obviously, in view of the circumstances of the past day or two, spoken to the Minister concerning these particular matters. I am not aware of anything that has arisen in recent days which would indicate that any elements of the declarations made to me were inaccurate. The companies with which I am advised the Minister is involved are private companies. They involve two or three families at most.

Mr Sinclair:

– They are proprietary companies.

Mr MALCOLM FRASER:

– They are proprietary companies. The Minister’s involvement with the Alan Walsh company was as executor to his father’s estate. I do not believe that matters relating to pecuniary interest should be pursued to such an extent that any member of this Parliament would be precluded from being an executor to his father’s estate and from carrying out the responsibilities that are thereby involved. I think that is a perfectly proper matter for any member of parliament or Minister to pursue. It needs to be noted also that to my knowledge this is the first government that has sought from Ministers a record of their pecuniary interests in a quite detailed manner and it is the first government -

Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP

-That is not so.

Mr MALCOLM FRASER:

– And in relation to Ministers’ staffs?

Mr Charles Jones:

– Yes, we did that.

Mr MALCOLM FRASER:

-That might have happened rather late in the day. But let me say that my Administration has taken these matters very seriously from the outset and, I believe, with a proper sense of propriety. I am happy to table the letters, as I have indicated.

Mr SPEAKER:

– The letters are tabled.

page 10

QUESTION

AUSTRALIAN ECONOMY: NEWSPAPER ADVERTISEMENT

Mr NEIL:
ST GEORGE, NEW SOUTH WALES

– Has the attention of the Prime Minister been drawn to an advertisement in the Sydney Morning Herald of 1 1 August referring to the Prime Minister and in which a number of statements were made about the economy? Has the Prime Minister made any inquiries as to the accuracy of these statements? If so, can he tell the House whether there was any substance in them?

Mr MALCOLM FRASER:
LP

– As a plain political comment, I should have thought that if any commercial organisation had put in an advertisement of that kind or had sought to promote its products by way of an advertisement that was as inaccurate as that particular advertisement it could well be in trouble with the law. That advertisement omitted a number of factors, one or two of which are perhaps not directly related but which I think entitle this House to ask who the shadow Minister for economic affairs is. The honourable member for Adelaide seems to have been left in the shadows in recent times.

Mr Hurford:

– I shall look after myself. I am quite happy.

Mr MALCOLM FRASER:

– I am very glad that the honourable gentleman can look after himself because he might be more acceptable than some others. What was said in that advertisement in relation to inflation was quite inaccurate. For example, inflation was running in the last half of 1975 at 16.8 per cent; in the last half of 1974 at 19.3 per cent, as a direct result of the Opposition’s policies when it was in government; and in the first half of this year, at 10.4 per cent. Even Mr Wran agrees that inflation is running at 10 per cent; there are public statements to that effect. That shows again how wrong the honourable member for Oxley was when he predicted, I think as late as 3 May, that inflation would be running at 15 per cent. In addition to that, profits have improved significantly by about 27 per cent during the past year, which would seem to indicate that the business situation is certainly improving. The profit share has increased. Private investment in plant and equipment has improved in real terms by something approaching 7 per cent. There was one true statement in the advertisement. I must pay credit to the authors of the advertisement for the correctness of the statement that if the Bill Hayden Budget had been followed up in 1976 Australia would not be in the state it is in today. It would certainly be far worse off. Inflation would be far worse and business in those circumstances would, indeed, be in a terrible state.

There is a long list of authoritative people in the Australian community at the present time who are clearly in general accord with the Government’s policies and with the results of those policies. Philip Shrapnel and Co. Pty Ltd in Economic Outlook in July this year said:

The Government is quite rightly heartened by the progress that is being made to contain inflationary pressures and there is every prospect that an even larger reduction in inflation will occur during 1977-78.

The Bank of New South Wales review in July 1977 said:

The prime aim of the Government’s economic strategy since it came to office 18 months ago has been the reduction of inflation. It can claim some success in moderating the rate of price increase.

The National Bank of Australasia Limited summary said:

There has been a progressive easing in inflationary pressures.

Hill Samuel Australia Limited said:

As the Treasurer has pointed out on numerous occasions the underlying rate of inflation appears to be trending downwards.

Syntec in August 1977 said:

Both the June quarter CPI figure and the strong July loan result could be taken as firm evidence that the Government’s anti-inflation policies are working.

I am certain that the people of Australia will treat advertisements of that kind for what they are worth and I hope that the people responsible for them will go on wasting their money in that way.

page 11

QUESTION

INFLATION: UNEMPLOYMENT

Mr UREN:
REID, NEW SOUTH WALES

-I ask the Treasurer whether his attention has been drawn to a report entitled Recovery With Inflation prepared by the United States Congress? Is he aware that this report showed that to take one percentage point off inflation over 3 years it would be necessary to add 1.2 percentage points to the unemployed? Applied to the Australian economy, would this mean that another 75 000 people would have to be thrown out of work to reduce inflation by one percentage point? Does this analysis show that the Government will only increase unemployment and deepen the recession if it continues with its misguided efforts to beat inflation the quick way by contracting the economy.

Mr LYNCH:
Treasurer · FLINDERS, VICTORIA · LP

– I find the honourable gentleman on this occasion more than usually tedious. I hope that he will curb his impatience until I am in a position to deal with matters of this type in a more definitive form later this evening. I suggest that, if he is able to curb his impatience, he may be better edified at that stage. I have not seen the report of the United States Congress. But these simplistic analogies that the honourable gentleman draws are certainly rejected by me and the members of this Government. I say to the honourable gentleman in the lowest possible profile that, if he is concerned about inflation and unemployment, he must have a gigantic concern for the new three, four, five, six, seven, eight, nine or ten point plan released by the honourable member for Oxley and the Leader of the Opposition recently to fix the problems which we inherited. I suggest to the honourable gentleman, who no doubt was not consulted at that time- and I underline the word ‘not’- that, if he looks at that package, he will see, as the Prime Minister, myself and other senior Ministers have made perfectly clear, that what the Australian Labor Party is now asserting is not a panacea, but is a recipe for more inflation, more unemployment, and the sort of recession which it caused in this country during the period it was in office.

page 11

QUESTION

COADJUTOR ARCHBISHOP OF SAIGON

Mr DOBIE:
COOK, NEW SOUTH WALES

– My question is directed to the Minister for Foreign Affairs. I have no doubt that the Minister is aware of the vexed problem of the gaoling by the Vietnamese authorities of the Coadjutor Archbishop of Saigon, Monsignor Francis Xavier Nguyen van Thuan

Mr Baume:

– It is a disgrace.

Mr DOBIE:

-Indeed it is. I trust that the Minister regards this case as one about which we should be maintaining a very serious concern. I ask the Minister whether any representations have been made to the Vietnamese authorities since July 1976? In view of this known case of a serious violation of human rights in that no charges have been laid against the Archbishop, I ask the Minister whether, having regard for Monsignor Thuan ‘s reported declining health, fresh and strong representations will be made to the Vietnamese authorities asking for his immediate release?

Mr PEACOCK:
Minister for Foreign Affairs · KOOYONG, VICTORIA · LP

-The short answer is that I am maintaining a close concern in the matter. Representations have been made since the date mentioned by the honourable member in his question. It will be recalled that Monsignor Thuan has reportedly been held in detention by the Vietnamese authorities since 1975 without charges being brought against him. The Australian Government raised the matter in Hanoi in July 1976. Since that time we have continued to make inquiries about his welfare, not only in Hanoi but also with the Vatican. These inquiries suggested that he was in good health and receiving civilised treatment although recent newspaper reports have suggested that his state of health is now very poor. Australia’s embassy to the Holy See recently sought further information from the Vatican about the welfare of Monsignor Thuan. The Vatican was unable to add much to the recent Press reports that we have gathered other than that he was still alive and still in detention.

Last month my Department drew this matter to the attention of the Vietnamese Embassy in Canberra. The Australian Government recognises that the detention of Vietnamese citizens in Vietnam would be considered by the Vietnamese to be essentially a domestic matter for their own Government. However, because of the depth of concern expressed by many Australians about Monsignor Thuan. a concern shared by the Government, I have written in my ministerial capacity to the Vietnamese Charge d ‘Affaires in Canberra about the welfare of persons under detention in Vietnam and of Monsignor Thuan in particular. That letter has been delivered to the Charge.

page 12

QUESTION

TAKEOVER OF COAL AND ALLIED INDUSTRIES LTD

Mr KEATING:
BLAXLAND, NEW SOUTH WALES

– Was the Treasurer or his Foreign Investment Review Board informed by Conzinc Riotinto Australia of its open share market activities to take over the Australian coal miner, Coal and Allied Industries Ltd? Does this action by a foreign-owned company contravene the provisions of the Foreign Takeovers Act? Did the covert market raid before notification by CRA give it an advantage over another competitor for Coal and Allied Industries, the Australian company, Peko-Wallsend? Can the Treasurer seriously regard the view of the Foreign Investment Review Board in this case when one of its members, Sir William Pettingell, is a director of Coal and Allied Industries? Do the Treasurer and the Government approve of the takeover? If not, will the Government insist upon the divestiture of the Coal and Allied Industries shares held by CRA or is the Foreign Investment Act a token piece of legislation to be flouted at the whim and caprice of any foreign corporation?

Mr LYNCH:
LP

-The Foreign Investment Review Board and the whole of the foreign investment review legislation are certainly not to be treated by anyone in this House as a matter of tokenism. The legislation, the policy behind it and the detailed operation of the Foreign Investment Review Board are working very effectively, a fact to which the case histories dealt with by the Board and myself bear evidence. With regard to the case referred to by the honourable gentleman, I have said in this House earlier- I reaffirm it- that I do not believe it to be in the interests of the processes of the Foreign Investment Review Board or of the policy itself that matters concerning the various parties who may from time to time be before the Foreign Investment Review Board should be the subject of quick question and answer in this House because of the confidential nature of the proceedings in question. Should that confidentiality be breached I suggest to the honourable gentleman that it would cut right across the whole thrust of the Government’s policy in relation to foreign investment and would be a marked disadvantage to foreign investors seeking to process applications through the Board.

The matter to which the honourable gentleman referred is before the Board at present. Careful consideration is being given to the application for approval in terms of the Act. A number of matters require detailed scrutiny including some legal aspects. As and when I am in a position to advise the honourable gentleman I shall do so. I am sorry that he mentioned the name of Sir William Pettingell in relation to this application. It was the sort of slight by inference that the honourable gentleman ought not to be making in this House. Many of these cases go across my table on a weekly and monthly basis. According to my best recollection Sir William disqualified himself from the case because of the sorts of innuendoes that the honourable gentleman himself made. Frankly, they would have been better not proffered by him in this House.

page 12

QUESTION

AUSTRALIAN LABOR PARTY’S ECONOMIC PROPOSALS

Mr HODGMAN:
DENISON, TASMANIA

-My question is directed to the Treasurer. Has the Government examined new economic proposals designed to lift government spending by $800m and to lift the government deficit to $3.5 billion? If such proposals have been looked at, is the Treasurer able to comment on them before the introduction of the Budget tonight?

Mr LYNCH:
LP

-There are not many matters on which I really welcome questions before the Budget is delivered, but I make an exception in the case of this question from the honourable member for Demson. The attention of myself and other Ministers certainly has been drawn to the document issued by the Leader of the Opposition and the honourable member for Oxley. Let there be no doubt whatever that should those proposals be implemented they would be highly inflationary. They would put the economy back into the situation it was in during the depression years of 1974 and 1975. Most certainly they would put upward pressure upon interest rates. After all, they are no different from the earlier proposals which the honourable member for Adelaide said would lead to the prolonging of inflation in this country. The House will be aware that, as the Prime Minister has mentioned, the honourable member for Adelaide was not involved, we understand, in the release of the new proposals even though he purports to hold the title of shadow Treasurer. It is not clear whether he stood out of the process because he was overseas or because he shared a very real sense of concern about the inflationary implications of those proposals.

The last time the honourable member for Oxley came forward with his $800m spending program he claimed that it would cost a net $200m. This time he claims that the net cost would be $500m. I can say that having an extra 50 000 people in work would generate savings in unemployment benefits of around $75m and a net addition to personal tax receipts of little more than $50m. I point out to the honourable member for Oxley that not only is his costing completely wrong once again but there would be no prospect of providing 50 000 jobs. That point should not be lost on the honourable gentleman, in particular, because after all he was the Minister who abolished the Regional Employment Development scheme. No doubt the additional $800m spending program of the honourable member for Oxley would be financed by implementing the suggestion made recently by the honourable member for Adelaide, that under a Labor government all people with incomes above $15,000 per annum would have to pay more income tax. I will close on this point: Perhaps the best way to summarise the new package put forward by the Labor Party is to refer, as I not infrequently do, to a recent editorial in the Australian Financial Review, which said quite simply and rather cogently, I thought at the time: ‘Mr Hayden blots his copybook’.

page 13

QUESTION

TAKEOVER OF COAL MINING COMPANY

Mr HURFORD:

– My question, which also is addressed to the Treasurer, is supplementary to the question asked by the honourable member for Blaxland. I will deal with the other matter just referred to by the Treasurer at some other stage. If the Conzinc-Rio Tinto of Australia Ltd takeover of Coal and Allied Industries Ltd is now before the Foreign Investment Review Board as the Treasurer states, can he say whether the Board was properly notified prior to the purchase of shares? Is it not a fact that under section 26 of the Foreign Take-overs Act the Board is supposed to give approval prior to any shares being purchased by such a foreign company as CRA? Is that not a prima facie case of CRA being in breach of the Act if that approval was not first given? At what stage did Sir William Pettingell disqualify himself from this case as he must have known, as a director of Howard Smith Ltd in addition to being a director of Coal and Allied Industries Ltd- Howard Smith Ltd being a partner of CRA in this deal- of the intended purchase of shares?

Mr LYNCH:
LP

– The sorts of innuendoes made by the honourable gentleman, which are quite consistent with the innuendoes made by his colleague the honourable member for Blaxland, are rejected by this Government. I thought I had made that perfectly clear. What those innuendoes do, and do in a very clear way, is give some indication of the sorts of policies that would be pursued by honourable gentlemen opposite if at some stage in the future, which is hard to predict, they were to resume occupancy of the government benches. As I have mentioned before, all the innuendoes behind what the honourable gentlemen have said in relation to Sir William Pettingell, as I recall the information provided to me, are utterly unfounded, but I will ascertain to what extent the further information sought by the honourable gentleman on that score can be made available to him. As to the balance of the question, I thought I had made it perfectly clear that these matters are before the Foreign Investment Review Board at the present time. As Treasurer I do not intend- through you, of course, Mr Speaker- to have a parliamentary debate or a question and answer exchange across the table with the honourable gentleman or any other honourable gentleman about a matter that is currently before the Board. I said to the honourable member for Blaxland that as and when I can provide further information to him I will certainly do so. In this case I will do the same for the honourable member for Adelaide.

200-MILE FISHERY ZONE

Mr THOMSON:
LEICHHARDT, QUEENSLAND

-My question is directed to the Minister for Foreign Affairs and concerns the growing number of countries which have made unilateral declarations of 200-mile fishery zones. This matter is of particular concern to my electorate, which not only embraces large parts of the Great Barrier Reef and the Gulf of Carpentaria but also has a mainland and island coastline.

Mr SPEAKER:

– Order! The honourable gentleman will ask his question and cease giving information about his electorate.

Mr THOMSON:

-Now that the Sixth Session of the Law of the Sea Conference has ended, is the Minister able to state the Government’s attitude to the proclamation of a 200-mile fishery zone? Does the Government intend to introduce legislation on this subject? If so, when will the legislation be introduced? Will the Government be informing other governments of its decision?

Mr PEACOCK:
LP

-I well understand the honourable member’s extensive interest in this matter. He will recall that prior to the Sixth Session of the Law of the Sea Conference the Government made it perfectly clear that it was hoping for a widely supported multilateral convention which included, among other things, the provision of a 200-mile exclusive economic zone. The Sixth Session’s deliberations concluded in July of this year. In the light of the fact that a growing number of countries are making or in the process of making unilateral declarations of extended maritime jurisdiction, and bearing in mind the need to protect our own valuable fishing stocks from the increasing number of foreign vessels fishing in our area, the Government stated that it would re-examine the need for legislative action after the Sixth Session had concluded. Of course, that now has been done, with the Sixth Session finishing in July of this year, as I have indicated.

We have decided that legislation should be drafted to enable the proclamation of a 200 nautical mile Australian fishery zone. Such a move should be seen as the first stage in exercising, in accordance with international law, Australia’s 200-mile zone rights around Australia and the Territories. In regard to the further questions asked by the honourable member I say that legislation is therefore now being drafted. No decision has yet been made regarding the timing of its introduction or when it will come into force. Those and other details will, of course, need to be discussed with other countries and in particular, pursuant to the undertakings we gave to the member countries of the South Pacific Forum, with those countries at the Forum’s forthcoming meeting towards the end of this month.

page 14

QUESTION

COLLAPSE OF TRAVEL AGENCIES

Mr CHARLES JONES:

-Is the Prime Minister aware that two travel agents- AUS Student Travel and the Four Seasons organisation- announced last week that they were in financial difficulties? Is he also aware of the Travel Agents Bill 1975 that was introduced in this House in March 1975 by the then Minister for Tourism and Recreation, the Honourable Frank Stewart, and passed by this House and then introduced in the Senate and on the Notice Paper of that House when the events of 11 November 1975 caught up with the Parliament? If this Bill had been proceeded with by this Government, would it not have protected all the people who may lose money or be inconvenienced by the collapse of these agencies or of others that it is suggested may collapse in the very near future? What does the Government propose to do to compensate or to assist those people who may lose their money? When can we expect legislation to protect travellers who in good faith pay money in advance for travel?

Mr MALCOLM FRASER:
LP

– The Minister in charge of these matters is preparing a submission for the Government which would explore the possibility of an approach involving Commonwealth and State co-operation. That submission has been some time in preparation. I hope it will be before the Government very shortly.

The Government is very much concerned about some aspects of the present situation. Only this morning I have been in discussion with the Victorian Government about these matters. AUS Travel, for example, is registered under Victorian legislation and an examination to see what went wrong would, of necessity, be conducted under Victorian law. At the same time both governments are exploring the possibility of a joint examination of these aspects. The Commonwealth has responsibilities for students throughout the whole of Australia. It is concerned to see that the arrangements that they might want to make in this area are appropriate and that student interests are properly safeguarded. Any examination that the Commonwealth would be involved in would be directed to that purpose. I hope it might be possible for a joint announcement to be made quite shortly by the Victorian Government and the Commonwealth Government, because these are serious matters.

page 15

QUESTION

KAMPUCHEA: REPORTED ATROCITIES

Mr GARLAND:
CURTIN, WESTERN AUSTRALIA

– I ask the Minister for Foreign Affairs a question. Has the attention of the Government been drawn to continuing reports that atrocities have occurred in Kampuchea, formerly Cambodia? Is the Government able to shed any further light on the extent of repression that has taken place since the change of government? Has he also seen reports of numerous border clashes with Thailand stating that numerous Thai villagers, including women and children, have been massacred? Does the Government have any information on these reports and what is the Government ‘s attitude?

Mr PEACOCK:
LP

-I would have to say that the information we possess is limited. Nevertheless, it is clear from a number of unconfirmed reports that have emerged that extensive repression, including executions, has taken place in Kampuchea since the Khmer Rouge came to power. In fact in recent testimony on human rights in Kampuchea the conclusion of a United States State Department official as to the estimate of the number of people who were thought to have perished in Kampuchea was that, while there was no way to confirm a precise figure, the number of deaths appeared to be in the tens of thousands, if not hundreds of thousands.

Turning to recent incidents that have been verified by independent observers and covered by reputable news media, there is no question but that Kampuchea troops have killed villagers, including women and children, living in the border areas between Thailand and Kampuchea. We realise, of course, that these border areas are in dispute as are, according to recent reports, parts of the frontier between Kam. puchea and Vietnam. But the slaughter of villagers can only lend credibility to the horror stories that have come from inside Kampuchea. We condemn in the strongest possible terms such cruel and unnecessary actions wherever they may occur and appeal to the Government of Kampuchea to respect international human rights principles. No government could possibly condone such slaughter, pillage and destruction.

page 15

QUESTION

MR JUSTICE FOX: CABLES

Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP

– I address a question to the Prime Minister. In view of the media and stock exchange speculation which arose in the middle of last month from accounts of cables the Prime Minister received from Mr Justice Fox, which His Honour and later the Prime Minister himself described as appalling speculation, I ask whether he will promptly table those cables just as the 2 reports of the Fox Committee were promptly tabled. Can the Prime Minister say why the letter has not been tabled which the judge sent on 8 November last, the day before he called on the Prime Minister after he had sought an appointment with the Prime Minister, and after the speculation which arose in the media and on the stock exchange concerning the first report of the Fox Committee?

Mr MALCOLM FRASER:
LP

– I shall see what information I can give the honourable gentleman.

page 15

QUESTION

INDUSTRIAL DISPUTES IN VICTORIA

Mr SHORT:
BALLAARAT, VICTORIA

-Is the Minister for Employment and Industrial Relations aware of the dislocation being caused to many industries in Victoria as a result of industrial disputes and of the direct and indirect employment opportunities being lost as a result of these disputes? Can the Minister give the House any precise details as to the current level of these disputes?

Mr STREET:
Minister Assisting the Prime Minister in Public Service Matters · CORANGAMITE, VICTORIA · LP

– I have information in broad categories as to the disputes currently going on in Victoria, although I do not claim that the information is necessarily comprehensive or exact in all details. To the best of my knowledge currently in Victoria one dispute affects the shipping industry, 11 involve the building and construction industry, two involve engineering and metals, one the food, drink and tobacco industries and five are taking place in other industries. Again, I do not have comprehensive information as to the precise number of people involved in these strikes. I have no doubt that it is very significant. For example, one dispute involves 2200 members of the State Electricity Commission of Victoria and another dispute affects 530 people involved in the construction of the Westgate Bridge. This sort of industrial action is being pursued by a small minority whose motto, apparently, is: ‘Might is right’. These people are heedless of the interests of their fellow unionists, those who are looking for work and of the community generally. They seem hell bent on destroying any system of orderly wage fixation in this country and of destroying prospects for creating new job opportunities.

page 16

QUESTION

REGISTRATION OF TRAVEL AGENTS

Mr STEWART:
LANG, NEW SOUTH WALES

-Is the Minister for Special Trade Negotiations aware of the recent collapse of two travel agencies and of the rumoured collapse of several more which will cause financial loss and inconvenience to many hundreds of Australian travel consumers? Can he explain why he failed to press for the reintroduction of the Travel Agents Bill 1975 which lapsed following the peculiar happenings, to say the least, of 1 1 November 1975 when that legislation was a consumer protective measure and when he was Minister for Business and Consumer Affairs and also the Minister in this House representing Senator Cotton whose portfolio covered tourism and travel agents? Is he also aware that the adoption by the Parliament of uniform legislation for the registration and control of travel agents could have prevented the collapse of these agencies or, at least, ensured that the consumers using those agencies would not suffer financial loss? As a matter of urgency, will the Minister now press for the introduction of uniform legislation to register and control travel agents throughout Australia?

Mr HOWARD:
Minister Assisting the Prime Minister · BENNELONG, NEW SOUTH WALES · LP

– The Prime Minister has already indicated that this matter has been under consideration by the Government in recent days. The honourable gentleman imputes to the legislation of the former Government effects which it may not necessarily have had. The question of effective travel agent legislation is under consideration by Senator Cotton at the present time.

Mr Stewart:

-The industry and the State Government would have approved the earlier legislation.

Mr HOWARD:

-If the honourable gentleman will allow me to finish the answer I shall do so. The Prime Minister has already indicated that this matter is under consideration by the Government. As the honourable gentleman will know, the company in question was and remains registered under the laws of Victoria. This is therefore not a matter which is totally within the responsibility of the Commonwealth Government. As a result, any response at government level must of necessity involve activity by both the Commonwealth and Victorian governments.

page 16

QUESTION

RETAIL SALE OF STATIONERY

Mr LUCOCK:
LYNE, NEW SOUTH WALES

-My question is directed to the Minister for Post and Telecommunications. I understand representations have been made to the Minister by the honourable member for Riverina about Telecom Australia becoming an outlet, through the Post Office, for the retail sale of stationery et cetera. If this suggestion is correct- in my opinion it would be contrary to all just business procedures- will the Minister take steps to see that this proposal is not implemented?

Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP

– There is no need for me to react to the honourable member’s question because I have already taken steps to see that both commissions discharge their responsibilities in the manner for which they were set up. One of the responsibilities is not to be a retailer of stationery. Some so-called market surveys have been carried out. It has been traditional in the Post Office, of course, to sell some equipment or goods which are involved with the business of postage of articles. Some consideration was given to extending this activity. Some weeks ago I reminded the Commission that I thought that that went beyond its charter. The Commission found it agreeable to accept my comments. I am certain that retailers and business people generally will not and ought not to have the problem of competition from these commissions.

page 16

QUESTION

VICTORIAN HOUSING COMMISSION LAND: COMMONWEALTH FUNDS

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

-Can the Minister for Environment, Housing and Community Development assure the House that Federal funds have not been improperly used to finance Victorian Housing Commission land deals, including those being examined by the Victorian Government’s board of inquiry?

Mr NEWMAN:
Minister for Environment, Housing and Community Development · BASS, TASMANIA · LP

– I think it would be improper for me to comment. Of course it would be possible for funds made available under the 1973-74 Commonwealth and State Housing Agreement to be used. I have no idea whether those funds were used, but they can be used for the purchase of land. The Victorian Government has announced a public inquiry. I believe that all the evidence taken will be public. I have no wish to comment any further until we hear the results of that inquiry.

page 16

QUESTION

REMARKS BY MINISTER

Mr YATES:

– I ask the Minister for Primary Industry a question concerning Poms and cricket. Did the Minister when he made his speech concerning primary industry say that all shop stewards and union officials who came from the United Kingdom had the disease or did he become muddled between corns and Poms? I think we ought to know exactly whether he said a few or all.

Mr SINCLAIR:
NCP/NP

-I am indebted to the honourable gentleman not only for his question but also for the support he gave me when I made my remarks. I thought that at the beginning of his question he might have been referring to a letter which I noted in the Australian the other day which stated that there were those in Canberra and elsewhere in Australia who after watching the start of the fourth test on television- perhaps this applies even more to the conclusionbelieved that the Deputy Leader of the National Country Party of Australia was wide of the mark in his attack on British immigrant shop stewards. The letter concluded:

I think his target should have been the Pommie umpires.

Whether that is so, it is certainly correct, as the honourable gentleman has suggested, that my remarks from the beginning were directed at a range of factors which I see as prejudicing good industrial relations in Australia. Obviously, within the Australian trade union movement there are a number of acknowledged communists and a number of radical left wing union activists who have contributed significantly to non-industrial action which prejudices the recovery of the Australian economy. In addition, there have been identified in a number of areas and in a number of industries others of different categories. In one group there were a few of those who are British shop stewards and a few of those who are British trade union leaders. Obviously, not all British trade union leaders are in the category to which I referred. Unfortunately, those few have significantly prejudiced economic recovery in a number of industries, and it was to them and against them that my remarks were directed.

page 17

QUESTION

CITIZENSHIP APPLICATIONS

Mr BRYANT:
WILLS, VICTORIA

– Is the Minister for Immigration and Ethnic Affairs aware that upwards of 15 000, perhaps even 20 000, applications for citizenship are in hand and are being processed very slowly in Melbourne, holding up the right to citizenship, and therefore the right of the people involved to get on the electoral roll? Is this delay a deliberate attempt by the Government to reduce the number of voters in Labor electorates, where most of the applicants reside, and so to make Labor electorates larger than they should be in the forthcoming distribution of House of Representatives seats and to create in effect an administrative gerrymander?

Mr MacKELLAR:
Minister for Immigration and Ethnic Affairs · WARRINGAH, NEW SOUTH WALES · LP

-I am aware that there are a number of applications for citizenship, not only in Victoria but in all States of Australia, and that has been the case for a very long time. The delay is less at the moment than it was during the honourable member’s time in government. I should like to lay this furphy to rest. There is no campaign to delay the processing of applications. This Government regards Australian citizenship very highly indeed. We regard the granting of Australian citizenship as a most serious matter. I think it is cause for some concern that various political parties, but particularly the Labor Party, have reduced the concept almost to a market one. Tables are being set up in the markets in Melbourne where people can get their application forms. Application for Australian citizenship should be such that a person has the opportunity to think clearly about his application. He should be encouraged to apply if he really wishes to take Australian citizenship. Citizenship should not be given away as a matter of no consequence. To finalise the answer, I make it quite clear that there is no overt delay in the processing of applications. We try to make such processing as quick as possible.

page 17

QUESTION

PRICES JUSTIFICATION TRIBUNAL: CONSIDERATION OF WAGE INCREASES

Mr BAUME:

-I address a question to the Minister for Business and Consumer Affairs, and I express my pleasure at seeing my New South Wales colleague on the front bench. Has the Minister given consideration to requesting the Prices Justification Tribunal to disregard cost increases due to wage rises granted outside the arbitration system? If so, is any action proposed?

Mr SPEAKER:

– I call the Minister for Business and Consumer Affairs to answer his first question as a Minister.

Mr FIFE:
Minister for Business and Consumer Affairs · FARRER, NEW SOUTH WALES · LP

-I am delighted to tell the honourable member for Macarthur and the House that this matter has received the active consideration of the Government. Indeed, it is not overstating the position to indicate that the Government has been extremely concerned about the sweetheart agreements entered into by some companies at a cost to the community in two ways: Firstly, the direct cost suffered by consumers; and, secondly, the effect of sweetheart agreements on inflation, which affects everybody in the community. This Government inherited from its predecessor a very high rate of inflation- something like 16 per cent- and tremendous progress has been made in getting the inflation rate down. The Prime Minister this afternoon referred to the inflation rate being in the vicinity of 10 per cent. The point I want to make very clear is that the Government will not stand by and see its wages policy affected in this way without taking some positive action.

I am able to tell the honourable member for Macarthur and the House that I propose to write to the Chairman of the Prices Justification Tribunal requesting that in its consideration of company prices the Tribunal disregard cost increases due to wage increases or wage related benefits which are granted outside the regular conciliation and arbitration machinery and which are inconsistent with the accepted standards of that machinery. I also take the opportunity to make it clear that those companies which grant increases outside the guidelines to which I have referred will be referred to the Prices Justification Tribunal for inquiry into their price structure. The Government is insistent in this matter. It regards the sweetheart agreements to which I have referred as being a direct attack on its wages policy and on its continuing efforts to bring this country’s inflation rate down to an acceptable level.

page 18

OFFICERS OF THE HOUSE: CHANGES IN STAFF

Mr SPEAKER:

– I wish to inform the House that during the period of the adjournment certain changes have occurred in the staff organisation of the House of Representatives. The following changes of officers attending in the chamber have been made: Mr I. C. Cochran, formerly Senior Parliamentary Officer, Bills and Papers Office, has been transferred to the office of Serjeant-at-Arms; Mr J. E. G. Bellchambers will act as Deputy Serjeant-at-Arms.

page 18

AUSTRALIAN EGG BOARD

Mr SINCLAIR:
Minister for Primary Industry · New England · NCP/NP

-Pursuant to section 23 of the Egg Export Control Act 1947, I present the annual report of the Australian Egg Board for the year ended June 1976.

page 18

AUSTRALIAN AGRICULTURAL COUNCIL

Mr SINCLAIR:
Minister for Primary Industry · New England · NCP/NP

– For the information of honourable members, I present the resolutions of the 100th meeting of the Australian Agricultural Council held in Launceston, Tasmania, in February 1977.

page 18

STATES GRANTS (NATURE CONSERVATION) ACT

Mr NEWMAN:
Minister for Environment, Housing and Community Development · Bass · LP

Pursuant to section 11 of the States Grants (Nature Conservation) Act 1974, 1 present a supplementary agreement in relation to the provision of financial assistance to New South Wales for land acquisition for nature conservation purposes-Violet Hill, 1976-77.

page 18

QUESTION

FIRE AT NAVAL AIR STATION, NOWRA

Report and Ministerial Statement Mr KILLEN (Moreton-Minister for Defence)For the information of honourable members, I present the conclusions of the Board of Inquiry into the fire at the Naval Air Station, Nowra, New South Wales, on 4 December 1 976. I seek leave to make a brief statement.

Mr SPEAKER:

-Is leave granted? There being no objection, leave is granted.

Mr KILLEN:
Minister for Defence · MORETON, QUEENSLAND · LP

– Honourable members will recall that on 4 December 1976 a fire at the Naval Air Station, Nowra, burnt down a hangar and destroyed or damaged 10 Grumman S2E Tracker aircraft and associated equipment. The Board of Inquiry was convened by the Flag Officer Commanding East Australia Area under the authority of the Naval Defence Act and was directed to examine the security arrangements and fire prevention measures which existed before the fire, how the fire was fought and action taken to minimise loss after the fire started, and to make recommendations to prevent a recurrence. They were advised that their report should state whether the fire and subsequent damage and destruction were attributable to acts or omissions on the part of any person or persons.

The Board’s inquiry was conducted concurrently with an extensive investigation undertaken by the New South Wales Police Force, assisted by Naval Police and the Commonwealth Police Force. The police investigations continued altogether for over 12 weeks. Approximately 2000 people were interviewed. The Board of Inquiry enjoyed exceptionally close co-operation and integration of effort with the police. The Board of Inquiry was assisted by a specialist in fire services and security from the Royal Australian Air Force and by experts drawn from a broad spectrum of specialised agencies of Commonwealth, State and local governments. I take this opportunity to record the appreciation of the Government for the valuable assistance provided by all authorities and persons to the Board of Inquiry. The Board of Inquiry established that the fire in H hangar was caused by deliberate action. Aviation gasoline was drained to the hangar floor from the tanks of at least two aircraft, the sprinkler system shut-off valve was closed and the gasoline was lit. The person solely responsible for these actions was Able Seaman Graham John Trent.

The conclusions I have tabled are taken verbatim from the Board of Inquiry report, except for names of individuals which have been removed in accordance with the practice that documents tabled in the House should not contain the names of individuals who are the subject of criticism.

The major conclusions of the Board of Inquiry were that the material aspects of security of aircraft within the hangar and of the hangar itself were less than adequate; various procedures relating to security of aircraft and hangars at the Naval Air Station were unsatisfactory; certain persons did not carry out their security duties in accordance with orders; various proposals to enhance the security of the Naval Air Station had not been put into effect; the standards of construction of H hangar were below those considered appropriate today for the safe stowage of aircraft; and the response to the alarm was good, the fire could not have been extinguished sooner or more closely confined, the actions taken to fight the fire were sound and many men showed great courage and determination in fighting the fire and removing aircraft to safety.

As honourable members will see from the paper I have tabled, the Board also drew conclusions on other matters of lesser importance dealing with inadequacies or deficiencies in the administration of security and fire protection at the Station. In April this year Able Seaman Trent was tried by court-martial on 13 charges of wilfully damaging a hangar and wilfully destroying or damaging a number of aircraft. The courtmartial found that Trent did the acts charged but was insane at the time when the acts were done so as not to be responsible according to law for his actions. The court-martial ordered that Trent be kept in custody until the pleasure of the Governor-General is known. Ten officers have been dealt with for their failure to ensure adequate security of the Air Station and its valuable assets and for not exercising proper supervision of duty security personnel on the night of the fire. The officers have been censured or admonished, including two severely censured at the highest level.

Short of trial and conviction by court-martial a censure is the most severe action that may be taken against an officer in peacetime. Consideration was given to the trial by court-martial of some of the officers concerned for negligence. Before an officer can be convicted by courtmartial in relation to negligence, it must be established beyond reasonable doubt that his conduct amounts to neglect in the manner charged. If so, it must further be established that the neglect is blameworthy or culpable in the circumstances. After receiving legal advice it was decided not to proceed by court-martial. Nevertheless, there is no doubt that a number of officers had fallen short of the standards expected of them to such a degree that censure or admonition was warranted. In addition, charges were laid against 10 sailors in summary proceedings. The offences alleged involved breaches of discipline committed whilst on duty. One sailor was found not guilty. In the other nine cases convictions resulted and fines were imposed.

Immediate steps were taken to improve the security protection of naval aircraft and the base complex. The following specific actions have been taken:

  1. Security of aircraft has been considerably improved by employing sentries in hangars, by more effective mobile patrols equipped with two-way radios, by more frequent random checks by senior Station officers and duty officers, and by the introduction of guard dog teams. The number of guard dog teams will be increased shortly.
  2. The security of the hangars has been upgraded to the extent practicable at this stage; doors can no longer be opened by outside devices, all padlocks have been checked in good order and the barring of external windows will be completed this month.
  3. The organisation for the control of keys to secure areas is now fully in accordance with Station orders and Naval regulations.
  4. The procedures for access to the Naval Air Station have been reviewed. Entry to secure areas within the establishment is being carefully controlled.
  5. Fire prevention and fire fighting measures have been improved by a number of steps including the dispersal of aircraft, the locking of sprinkler control rooms, the improved readiness of fire fighting equipment and agents, clarification of orders on the carriage of cigarette lighters and matches, and the removal of flammable liquids and combustible material from hangars on completion of work each day. Action also has been taken to improve the training and exercising of personnel in the fighting of all types of fires that might be encountered on the Station, and to improve procedures to contact duty personnel and the local fire brigade.

Some $43,000 has been expended or committed on works to improve security since the fire. In addition, items have been included in the works program for this financial year to provide for improved security to a number of areas in the Station, principally to extend the facilities for the introduction of two new fire tenders, to improve the perimeter road, to provide a flammable stowage for one hangar, and to improve security and fire protection in a number of other buildings. These items are being progressed as rapidly as practicable. Consideration is being given to a number of further measures including provision of additional security fencing, illumination and security alarms for other sensitive areas, illumination of the aircraft hardstanding adjacent to the hangars, and renewal of lighting in some hangars using flame-proof fitments. Action is proceeding for the early installation of intruder alarm systems to the appropriate hangars at the Air Station. A full periodic inspection of the Naval Air Station has recently been completed. Considerable improvement in the Station’s security awareness has been reported.

There can be no doubt that the fire at the Naval Air Station, Nowra, was a severe blow to our defence capabilities at the time. The Government was able quickly to replace the aircraft. I wish to acknowledge that this action would not have been possible without the prompt and most generous assistance of the United States Government and the United States Navy. In all, the estimated value of the hangar, aircraft and equipment lost amounted to nearly $9m. The cost to replace the aircraft and equipment, which has already been announced, is estimated at nearly $7m. It is pertinent to remind honourable members that the Naval Air Station at Nowra is an extensive and complex facility. Its primary functions are to provide a base for the operational squadrons for HMAS Melbourne when disembarked, for training squadrons and for Fleet requirements; to provide organisational and intermediate level maintenance and support for naval aircraft; and to provide operational training for air crew and to provide ground training for maintenance personnel. In addition to normal naval operational and training flying, the Naval Air Station meets demands for search and rescue and aid to the civil community. The Commanding Officer of the Naval Air Station is also responsible for the operation and maintenance of the Jervis Bay airfield and the missile range. In all he commands nearly 2000 people and at the time of the fire there were 61 aircraft at his Station. The Naval Air Station and the Jervis Bay target services group have consistently maintained high standards in meeting their flying, maintenance and training commitments.

It could be argued that fault lay in the system where physical improvements to security that had been requested were not provided. I do not share this view entirely as it was within local authority to make alternative arrangements pending the introduction of improvements. In any case, it will always remain extremely difficult to prevent the irrational action of a person from within one’s own organisation. These points do not excuse the unsatisfactory state of security which existed at the Naval Air Station at the time of the fire and I do not condone or underestimate the faults and inadequacies that this inquiry has exposed. In the face of the fire itself, the performance of that Station’s personnel stands very much to their credit. To enter the hangar and to approach the heat of the fiercely burning fire demanded great courage, a courage shown by many that night. A number of young and inexperienced sailors fought the fire to the point of collapse and after revival continued to volunteer for further duty. Others, well aware of the dangers of the operation, hazarded their lives to remove aircraft from the hangar even to the point of re-entering the burning building after being ordered to leave as the roof might further collapse. Personally, I commend them and believe that honourable members would join me in this. As a result of their actions 16 personnel are being considered for appropriate awards.

The most significant lesson from this unfortunate affair is that the security of valuable defence assets rests primarily in the hands of the users. Commanding officers must guard their assets as thoroughly as they have been trained to use them. But it is the personal and continual watchfulness of every officer and man that is our foremost defence for the security of our assets. The Chiefs of the three Services share my views in this regard whole-heartedly, and immediately following the fire they took steps to improve security awareness and training on the part of all members of the defence force. While the conclusions indicated that there was much that could be done to improve security by way of modern protection devices, firefighting equipment and provision of security personnel, all these must be weighed against competing demands for limited defence resources of money and manpower. It is a delicate matter of judgment to determine just what proportion of our resources should be devoted to what might be regarded as an insurance premium.

The fire at the Naval Air Station, Nowra, has caused me deep concern. I say that with all bluntness. That such valuable equipment should have been destroyed in such a manner is deplorable. That security procedures were not properly observed, and in some respects were inadequate, cannot be excused. They will not be excused. As the Minister responsible I acknowledge to the Parliament the clear and ultimate responsibility I hold in this most unhappy sequence of events. The Nowra fire experience has not been dealt with in isolation. Misfortune can be a harsh tutor. The report of the Board has been closely studied. Where appropriate, the lessons of the Nowra fire will be sternly followed.

Mr HAYDEN:
Oxley

-by leave-I join with the Minister for Defence (Mr Killen) in commending publicly the courage of those members of the armed Services who displayed great courage and dedication on the night of the fire at the Nowra air base. It is clear from what the Minister has said and from reports in the media that many men extended themselves beyond what would normally be regarded as a reasonable level of endurance and exposed themselves to considerable danger in this display of courage. Those men deserve commendation. I am pleased that the Minister has seen fit to note publicly for the record that appropriate action will be taken to acknowledge properly that display of courage.

For all that, the report is a most distressing and disturbing document. It is the report of a $9m outrage. It is a farrago of grave errors, breathtaking blunders, crass inefficiency and sheer incompetence. It is the record of massive neglect of duty on the part of numerous members of the armed Services. The most significant part of the document that the Minister has presented to the Parliament and of his statement is that the inferences, especially from the document, make it clear that only the edges of that major scandal have been touched upon. Ten sailors have been charged in summary proceedings and nine have been convicted and fined. Ten officers were censured or admonished but apparently not charged. That is remarkable. The captain runs his ship aground and gets a rap over the knuckles; the gunner’s mate and his offsider are hauled before the drumhead court and are convicted.

There is another aspect of the Minister’s presentation to the Parliament which leaves me more than a little curious, that is, his display of tenderness about the disclosure of names. He suggests that this is consistent with the practice of the House. As far as I am able to establish through checking with most eminent authorities in this House, it is not a practice established by precedent but rather something that has been done by a Minister on some occasions. As far is I can establish, no consistent pattern of practice is followed in such matters in the terms in which the Minister suggests. I understand that on occasions on which the practice pursued by the Minister on this occasion has been adopted it has been usual to indicate why the practice has been adopted. Usually there are powerfully important reasons, associated with the public interest, to justify the non-disclosure of names in such a situation.

Let us remember, this is a $9m outrage- a public scandal for which the community has to pay. I shall outline some of the evidence of the scandalous circumstances associated with this incident. A far less serious offence in a civil court would result in full disclosure in the media. In the circumstances at the very least the Parliament of the nation, as the responsible authority husbanding the taxpayers’ cash and administering the responsible public offices of government, has a right to know exactly who was charged and with what, who was admonished or censured, or whatever the action was. This is, as far as I can establish, a most unusual procedure for the Minister to have adopted on this occasion. It displays a tenderness for the personal feelings of some people, which is in marked contrast to the total absence of tenderness for other groups in the community who are berated, assaulted and attacked by Government spokesmen from time to time for much less serious matters.

I say that there are scandalous circumstances associated with this matter. The Minister glossed over the scandalous circumstances rather superficially. In his statement he said, among other things:

The major conclusions of the Board of Inquiry were that various procedures relating to security of aircraft and hangars at the Naval Air Station were unsatisfactory . . .

Let us look at the unsatisfactory nature of some of these matters to which he referred. At page 3 of the report of conclusions- it is no more detailed than that; it is a bare skeleton from the Board of Inquiry- paragraph 393 (a) states:

The aircraft in the hangar could not be securely locked as they were not fitted with approved security locks;

This is a most peculiar set of circumstances. Surely our armed Services are not reduced to using sticking plaster to lock the doors of expensive and highly secret equipment. Paragraph 393 (b) states:

The hangar could not be securely locked as some door locking pins could not be engaged, others could be manipulated-

What a delicate word to use, but I shall come back to that - from outside the hangar, and the locks on the doors were not of an approved security type;

As I understand newspaper reports, the manipulation he referred to consisted of using a broom handle to toss the lock open. This is a most curious set of security arrangements for one of the key defence establishments in this country. The whole thing could be blown open with a broom handle. Such is the complex nature of the security.

The Minister is a man who makes a profession so often of being a stern patriot in defence of the security of this country. He will not have a word of criticism levelled against the defence Services, more especially against the Department of Defence. He is quick to take defence in their defence. Yet here is more than ample justification for the most stern criticism to be levelled against the Department of Defence, against a section of the defence forces and against the political administration, however far back it goes and whatever area of the Navy it covers. Paragraph 393 (c) states: the offices and stores within the hanger were not secure as they were not fitted with approved security locks, nor were their keys returned on a secure keyboard;

Apparently we are now going to run our armed Services on some sort of honour system. This is in spite of an acknowledgment in this report that there have been earlier thefts of property from the Nowra base. Paragraph 393 (e) states: the hangar should have been protected by security alarms. Although installation had been proposed in December 1973 and the need agreed, it had not been effected by the time of the fire;

Who is responsible? We do not know. Somewhere along the pipeline of decision making there has been a breakdown. Perhaps someone in some senior position who is fonder of the more impressive displays that go with new capital equipment has decided that many of the things implicit in this particular section- I shall refer explicitly to those in a few seconds- become much lower priorities when compared with the need for grand displays. As I said, this is a most unhappy set of circumstances.

On page 4 of the conclusions of the Board of Inquiry paragraph 394 (a) states: the aircraft were not locked in the hangar with full time guards to control access as they were required to be;

Apparently we are training our armed Services for a part-time war. Paragraph 394 (b) states: although the hangars were classified areas by virtue of the equipment they contained they were not so designated and this was a factor contributing to their inadequate protection;

Someone simply forgot to put the armaments on the aircraft, to put the shells on the ship, and sent the aircraft to war. What nonsense! How does such an unsatisfactory set of circumstances ever develop in one of the key defence establishments of the armed services of this country?

Paragraph 394 further states: the arrangements for control of access to the hangar were unsatisfactory in that the lists of those who could draw and return keys was incomplete and not correctly authorised, and there were no procedures in force to determine that these personnel drawing and returning keys were authorised to do so.

Presumably the tea lady knew more about the functioning of the Nowra base than did the people supposed to be in charge of the administration and operation of security arrangements there. Paragraph 394 also states:

  1. the procedures relating to security patrols were unsatisfactory in that the actual arrangements were not the arrangements ordered, and that the more experienced patrolmen did not carry out rounds of the required frequency or duration, and
  2. the procedures relating to the supervision of the duty watch as a whole were unsatisfactory in that the standard of compliance of the orders was below that desirable, and there were no adequate checks on performance.

That is sheer neglect and laziness not just on the part of the people who neglected to perform those duties but also on the part of the people in senior positions at that base who were supposed to ensure that those duties were carried out. It seems to me that, as a simple principle, the Defence Services would apply some unexpected random checking procedure so that from time to time unexpected checks could be made of the standard of security at armed services bases throughout this country. One shudders with great sense of fear that perhaps what has been exposed here is merely a symptom of a general problem that has been allowed to develop through a deterioration of standards one way or another in the armed services. I turn to page 5 of the report where, under ‘Conclusions’, paragraph 396 states:

That the various proposals to enhance the security of the Air Station were not put into effect, we attribute to a combination of several causes.

Paragraph 396c then indicates that one of the causes was a lack of clarity as to who was responsible for action. So it seems that we are going to have plenty of admirals in the Navy and not enough sailors. It is almost a Gilbert and Sullivan farce. This is an incredible situation and the Minister seemed to brush it aside rather superficially today dealing in no way at all with the details of this $9m outrage which has occurred in Australia.

Mr Killen:

– I did nothing of the sort.

Mr HAYDEN:

– Even in this brief and slender document there is clear evidence of neglect and dereliction of duty. The Minister is the person responsible for this section of the Department of Defence. How did this situation arise? Why have we not been provided with the substantial evidence from the investigation indicating how this grave deterioration in standards has occurred in the defence forces of the country? The Minister has converted the Navy into the laughing stock of the country and the Navy does not deserve that sort of treatment.

This document discloses a record of laxity and bungling. Paragraph 396e reveals that ‘in several instances, oversight or procrastination by those responsible for action’ was one of the causes of the problems identified by the inquiry. Why have we not had some hard firm tough exposition from the Minister about this matter? Why has there not been the sort of toughness which he likes to display in the words he uses from time to time in the House when dealing with largely irrelevant matters? Why have we not had some tough exposition from him on this oversight and procrastination by those responsible? But in a situation where there is an absence of clarity as to who is responsible for action and when such a damning indictment is tabled in the Parliament with such a short and superficial comment being made by the Minister about it, how can we have any confidence in the defence Services? Referring to the principal deficiencies at the time of the fire, paragraph 399 states:

  1. the electrical installation did not comply with the guidelines for hangar installations issued by the SAA,
  2. the hangar lacked detectors to give warning of the leakage of Avgas or to provide early detection of fire,
  3. the sprinkler system was not adequate to suppress under wing fires, or to prevent the spread of fire from one closely stowed aircraft to another,
  4. there were no automatic heat release vents fitted.

Paragraph 405e, which refers to the conduct of fire fighting operations, contains the conclusion: that there are drawbacks in the use of dissimilar couplings on hydrants and on vehicles.

The document discloses a litany of disastrous administration from the top down to the bottom, of neglect and of indifference. We are used to hearing from this Minister dissertations about the powerful readiness, alertness and defence preparedness of the defence forces of Australia. I am embarrassed to confess, however, that this report converts the Navy into a laughing stock before the Australian public and the Minister wants to brush it aside with such a superficial statement.

Mr Killen:

– That is a contemptible thing to say.

Mr HAYDEN:

– This represents one of the most scandalous set of circumstances that has been presented to this country. It reveals an absence of security and shows that people are able to jig open with a broom handle the door of the main hangar containing these aircraft comprising a large section of the Fleet Air Arm preparedness. In spite of the acknowledged fact that there have been thefts of gasoline at the base it was still possible to open the door with a broom handle. The Navy was brought to its knees with the jiggle of a broomstick.

The hard fact is that, if procedures had been sound and had been properly followed, this event would not have happened. There has been neglect in the failure to install fire protection equipment and where it has been installed it has been inadequately set up. On that score alone it seems to me that there should be a follow up inquiry to find out who is responsible for that and what sort of decisions took priority over decisions about fire protection at the base and to determine whether this sort of thing occurs in other Australian defence establishments.

I remind honourable members that this is not the first fire to occur at the Nowra air base. In the course of questioning in this Parliament over some years the Leader of the Opposition (Mr E. G. Whitlam) established that in 1967 there was a fire, on Christmas Eve, at the Nowra air base and the Commonwealth Fire Board, which is supposed to have reported to it all fires, received a report of a fire to a hut involving damage to the value of $8,000. Persistent questioning by the Leader of the Opposition established that there was also the destruction of a trailer containing expensive equipment to the value of $ 1.6m. That was not brought to the notice of the Commonwealth Fire Board. It was not acknowledged in this House when the Leader of the Opposition first started questioning on this matter in the late 1 960s. It seems that there may well be a long history of laxity on the part of the naval authorities, whoever they may have been from time to time, at Nowra in first of all not fully acknowledging their responsibilities by making full disclosure of matters such as this and ensuring that the administration of the air base and of the equipment thereon and of the property which is part of the base was attended to properly.

What I do find terribly distressing is paragraph 405e which states: that there are drawbacks in the use of dissimilar couplings on hydrants and on vehicles.

Fourteen years ago in Townsville there was a fire at a sugar terminal and the local fire brigade was unable to quell the fire and called for assistance on other authorities, such as the Department of Civil Aviation and the Department of Defence, including the Royal Australian Air Force Base at

Townsville. It was discovered that none of the various fire fighting authorities called upon had common coupling equipment. As a result of that the present Leader of the Opposition proposed then that a common standard ought to be adopted. In government he applied as much pressure as he could to have that objective achieved. This would seem a trivial matter in a situation where there was no fire and no one was expecting one, but we do not anticipate fires. They just happen and they can be quite damaging and extemely expensive holocausts. Fourteen years later the common coupling standard has still not been established. More significantly, within one military establishment there were dissimilar couplings on hydrants and vehicles. Clearly, that must have acted as a serious impediment in the fighting of a fire.

There is one other aspect I wish to take up before I conclude. It is apparent to me from the report of the Board of Inquiry that it clearly inferred that there are other authorities who bear considerable responsibility in this matter who remained indifferent to submissions about the need for adequate fire-fighting equipment and who established higher priorities than giving adequate attention to the needs of the security of the Nowra naval base. Let us not be under any misapprehension as to the lack of security at the Nowra naval base. A day or two after the fire a reporter from the Australian newspaper was able to enter the base by glibly presenting himself to the guard at the gate. I seem to recollect that he had a meal, played snooker or indulged in some casual pastime without being challenged in any serious way. I found then and I find even more now that the Minister’s comments of that time were totally unconvincing. This document confirms the slackness we have seen.

Who are the people responsible for the decisions which have allowed these gaps and defects to have arisen in the arrangements at the Nowra naval base? Are they the top brass in the Navy who wanted more and better presentable capital equipment and were prepared to make that their priority at the expense of adequate firefighting and security equipment at the Nowra base? Are the men at the top of the Public Service who have been passing advice to the political administrator at fault? Is it some political administrator? I believe these things need to be sorted out. I repeat that we have a $9m scandal before us. Ten sailors and officers alone should not be receiving the kick in the pants for what has happened. Who are the culprits? We deserve to know. What about the position of the Minister and the head of his Department or, perhaps, both? Is the situation serious enough to represent itself as serious neglect on the part of one or both? The whole thing is bristling with challenging questions which have not been attended to. The sort of patriotism that the Minister likes to throw about so easily on issues of defence is not a sufficient substitute for the information we require now.

Mr Killen:

– Why do you not accuse me of lighting the fire? It is the only thing you have not done.

Mr HAYDEN:

-Neglect can be as significant a contributory factor as any other. You are the Minister and you acknowledge in your report-

Mr Killen:

– That is a contemptible slur. You were the Treasurer. Am I to blame you? What an absurdity!

Mr HAYDEN:

– Was it false gallantry when the Minister stated:

As the Minister responsible I acknowledge to the Parliament the clear and ultimate responsibility I hold in this most unhappy sequence of events.

I have taken up your offer. I have reminded you of what you said. I pointed out very properly that you were correct then. Now, when I take you up we find how empty and shallow are the principles of parliamentary responsibility that you enunciate. You are certainly dedicated to them as long as no one seeks to nail your responsibility upon them.

Mr SPEAKER:

– Order! The honourable gentleman will address his remarks through the Chair and not directly across the table.

Mr HAYDEN:

– We intend to give much more detailed consideration to this matter. We are concerned about standards in the Department of Defence as well as in the defence services. We are not fobbed off with some sort of fustian response to the National Times, picking semantically on one minor issue, to attack a female journalist who wrote a most telling series of articles about the Department and the Minister. We want to know more. Miss Summers has set in motion a most important public demand for inquiry. We intend to take that up. As a start we believe that a joint select committee of inquiry should be appointed to inquire into and report upon:

  1. Security arrangements for all defence establishments in Australia;
  2. Fire prevention measures applicable at all such establishments including the suitability of buildings to minimise fire damage;
  3. The standard of and any need for improvement in training of personnel for the prevention and fighting of fires;
  4. The need for common procedures and equipment between the Services and between the Services and civilian authorities for fire prevention and fire fighting;
  5. Other relevant matters.

That goes nowhere near as far as all the other matters to which I referred. Clearly, we want to give consideration to the other matters. But we are gravely concerned that what has been exposed in this instance may be more general than we realise. This country cannot afford another $9m scandal. The taxpayers do not want to see their money frittered away in that manner. The security of this country cannot stand that sort of savage blow against its preparedness. As there is no other facility available for me within the procedures of the House other than giving notice at a later date I move:

That so much of the Standing Orders be suspended as would prevent the honourable member for Oxley from moving:

That a joint select committee of inquiry be appointed to inquire into and report upon:

Security arrangements for all defence establishments in Australia;

Fire prevention measures applicable at all such establishments including the suitability of buildings to minimise fire damage;

The standard of, and any need for improvement in, training of personnel for the prevention and fighting of fires;

The need for common procedures and equipment between the Services and between the Services and civilian authorities for fire prevention and fire fighting;

Other relevant matters.

Mr SPEAKER:

-Is the motion seconded?

Dr KLUGMAN:
Prospect

– I second the motion. I address myself to the last paragraph of the motion, ‘Other relevant matters’. What worries me is that an insane person was in the Navy and had a grudge against it without the Navy being aware of it, or being aware of it and not taking appropriate action. This worries me all the more as I have on a number of occasions made representations on behalf of servicemen, including Navy personnel, who, to put it at its lowest, appear to be psychologically unsuited for the Services and yet cannot get a discharge. I realise that a definitive diagnosis of psychosis is not easy and that there may be servicemen who would try to take advantage of a softer policy to obtain an early discharge. I put it to the Minister: Is it really worthwhile for the Services to keep such persons if there is any doubt?

I have not yet had a chance to read the report of the Board of Inquiry. As far as I know, the Board of Inquiry did not deal with this particular aspect. I assume it met before the trial. It was only at the trial that the question of insanity was raised. I urge the Minister that when the matter is discussed by the committee we are proposing the question of the suitability of Service personnel in general be considered. If Service personnel feel strongly against and obviously seem to have a grudge against the Service some attempt should be made to discharge them at the earliest possible opportunity.

Question put:

That the motion (Mr Hayden’s ) be agreed to.

The House divided. (MrSpeaker-Rt Hon. B. M. Snedden, Q.C.)

AYES: 29

NOES: 82

Majority…….. 53

AYES

NOES

Question so resolved in the negative.

page 26

INDUSTRIES ASSISTANCE COMMISSION REPORTS

Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP

– For the information of honourable members I present the following reports of the Industries Assistance Commission:

Pharmaceutical and Veterinary Products;

Pumps and Compressors;

Batteries Part B: Primary Batteries;

Tyres;

Measuring, Checking, Precision Instruments and Apparatus, etc;

Electrical Control Apparatus and Insulating Fittings;

Financing Promotion of Rural Products;

Financing Rural Research;

Malleable Cast Iron Fittings (Developing Country Preferences); and

Motor Vehicles- Extension of Import Restrictions

page 26

BILLS RETURNED FROM THE SENATE

The following Bills were returned from the Senate without amendment or requests:

Phosphate Fertilizers Bounty Amendment Bill1977.

Dairy Industry Stabilization Bill 1977.

Dairy Industry Stabilization Levy Bill1977.

Dairy Produce Amendment Bill 1977.

Dairy Industry Assistance Bill 1977.

Dairy Industry Assistance Levy Bill1977.

Australian Meat and Live-stock Corporation Bill1977.

Live-stock Export Charge Bill1977.

Live-stock Export Charge Collection Bill 1977.

Live-stock Slaughter Levy Amendment Bill 1977.

Live-stock Slaughter Levy Collection Amendment Bill 1977.

Meat Research Amendment Bill 1977.

Customs Tariff Amendment Bill 1977.

Customs Tariff Validation Bill (No. 2) 1 977.

Health Insurance Amendment Bill 1977.

Stevedoring Industry (Temporary Provisions) Amendment Bill 1977.

Stevedoring Industry Charge Amendment Bill1977.

States Grams (Roads Interim Assistance) Bill1977.

Defence Service Homes Amendment Bill1977.

Commonwealth Legal Aid Commission Bill1977.

Trade Practices Amendment Bill1977.

page 26

ASSENT TO BILLS

Assent to the following Bills reported:

Income Tax (Companies and Superannuation Funds) Amendment Bill1977.

Australian National Railways Amendment Bill1977.

Housing Loans Insurance AmendmentBill1977.

Loan (War Service Land Settlement) Bill1977.

Roads Acts AmendmentBill 1977.

Income Tax (Rates) Amendment Bill 1977.

Wool Industry AmendmentBill1977.

Wool Tax Amendment Bills (Nos.1 to 5)1977.

Supply Bill (No. 1) 1977-78.

Supply Bill (No.2) 1977-78.

Dairy Industry Stabilization Bill 1977.

Dairy Industry Stabilization Levy Bill 1977.

Dairy Produce Amendment Bill 1977.

Dairy Industry Assistance Bill 1977.

Dairy Industry Assistance Levy Bill 1977.

Repatriation Acts Amendment Bill1977.

Income Tax Assessment Amendment Bill1 977.

Administrative Appeals Tribunal Amendment Bill1 977.

Administrative Decisions (Judicial Review) Bill1977.

States Grants (Advanced Education Assistance) Amendment Bill 1977.

States Grants (Schools Assistance) Amendment Bill1977.

States Grants (Technical and Further Education Assistance) Amendment Bill 1977.

States Grants (Universities Assistance) Amendment Bill 1977.

Conciliation and Arbitration Amendment Bill1977.

National Labour Consultative Council Bill1977.

Phosphate Fertilizers Bounty Amendment Bill1 977.

Australian Meat and Live-stock Corporation Bill1977.

Live-stock Export Charge Bill1977.

Live-stock Export Charge Collection Bill1 977.

Live-stock Slaughter Levy Amendment Bill1 977.

Live-stock Slaughter Levy Collection Amendment Bill 1977.

Meat Research Amendment Bill1977.

Customs Tariff Amendment Bill 1977.

Customs Tariff Validation Bill (No. 2 )1977.

Health Insurance Amendment Bill1977.

Stevedoring Industry (Temporary Provisions) Amendment Bill.

Stevedoring Industry Charge Amendment Bill 1977.

States Grants (Roads Interim Assistance) Bill 1977.

Defence Service Homes Amendment Bill 1977.

Commonwealth Legal Aid Commission Bill1977.

Trade Practices Amendment Bill1977.

Constitution Alteration (Senate Casual Vacancies) Bill 1977.

Constitution Alteration ( Retirement of Judges) Bill1 977.

Constitution Alteration (Referendums) Bill 1977.

page 26

SESSIONAL ORDERS

Mr SINCLAIR:
Leader of the House · New England · NCP/NP

- Mr Speaker, I seek leave of the House to move motions relating to Sessional Orders for the routine of business of the House, the power to add a protest or dissent to a select committee report, the counting of members in a quorum, the Speaker’s discretion relating to the adjournment of the House when a quorum is not present, and the ringing of division bells in successive divisions. If I may, I would like to give a brief explanation of my request for leave. On 10 March the House agreed to seven Sessional Orders relating to the proceedings of the House. Of the Sessional Orders, those relating to the hours of meeting and the adjournment of sittings and time limits for the adjournment debate have effect, unless otherwise ordered, for the remainder of the session. Those relating to the routine of business, the power to add a protest or dissent to a select committee report, the counting of members in a quorum and the Speaker’s discretion as to adjourning the House, and the time forringing division bells on successive divisions operated for the remainder of the autumn period of sittings and ceased to have effect when the House rose for the winter adjournment. There would appear to be no reason against the reinstatement of those Sessional Orders which lapsed when the House last rose. The House will thus have an opportunity to evaluate further the operation of those Sessional Orders. I believe that it is preferable to act in this manner than for a motion now to be introduced for their adoption in the Standing Orders as there are a number of other matters in abeyance which I trust will be resolved and which similarly may be introduced in the form of Sessional Orders and in that way be tried within the Parliament before they are finally adopted in the Standing Orders themselves. For that reason I seek leave to move a number of related motions.

Mr SPEAKER:

-Is leave granted? There being no objection, leave is granted.

Routine of Business

Motion (by Mr Sinclair) proposed:

That, unless otherwise ordered, on those alternate sitting Thursdays when Grievance Debate is the first Order of the Day, Government Business, under Standing Order 106 or when General Business has precedence on the Notice Paper under Standing Order 104, so much of Standing Order 101 (routine of business) be suspended as would prevent Grievance Debate or General Business, as the case may be following 5. Ministerial statements, by leave, and preceding 6. Matter of public importance.

Mr SPEAKER:

-I wish to make the comment that I believe that the practice of trying out new procedures by introducing them in the form of Sessional Orders before the Standing Orders are amended is a good practice.

Mr SCHOLES:
Corio

-The Opposition does not object to the motions as circulated. We agreed to the matters contained in them during the previous session. I would point out, however, that I think that there is a limit to how long Sessional Orders can be used as a substitute for Standing Orders. I think that the practice of using this method commenced when Mr Daly was Leader of the House. I see advantages in it but I do not see it as being a substitute for considering the actual Standing Orders and the changes to those Standing Orders which should be made on a permanent basis. Under these circumstances the House can agree to Sessional Orders and they can be subsequently allowed to lapse by a government without any consideration being given to them by the House- merely by the effluxion of time.

Another matter that I wish to raise with the Leader of the House (Mr Sinclair) at this stage is the question of the consideration of the report of the Committee on Committees and the broader recommendations of the Standing Orders Committee, which should be brought before this House during this session at least. Subject to the Parliament still continuing at that time, I hope that prior to the autumn session the Leader of the House will bring forward the necessary amendments to the Standing Orders to bring about the alterations which are acceptable to the House and which should be made. The Opposition does not object to these Sessional Orders being introduced at this time but considers that the trial period should not be too protracted.

Question resolved in the affirmative.

Mr SINCLAIR:
Leader of the House · New England · NCP/NP

- Mr Speaker, perhaps I could incorporate the balance of the motions in one motion.

Mr SPEAKER:

– The Leader of the House will have to seek leave to move the remaining four motions in the form of one motion.

Mr SINCLAIR:

-I seek leave to move the balance of the motions relating to the Sessional Orders in the form of one motion.

Mr SPEAKER:

– Is leave granted? There being no objection, leave is granted.

Mr SINCLAIR:

– I move:

Select Committee Reports

  1. 1 ) That, unless otherwise ordered, so much of Standing Order 343 be suspended as would prevent a protest or dissent being added to the report of a select committee of this House.

Quorum- Count of Members

  1. That, unless otherwise ordered, for the purposes of determining a quorum of members, a member who is in any of the lower galleries or officials ‘seats, behind the bar of the House or in either of the side alcoves at the time when the attention of the Speaker or the Chairman of Committees is called to the lack of a quorum or who remains in any of those areas after attention has been so called, shall not be counted to determine whether a quorum is present.

Quorum

  1. ( 1 ) That, unless otherwise ordered, if it appears that a quorum of members is not present following:

    1. the report by the tellers of a division of the House (Standing Order 44),
    2. the counting of the House after a member has drawn attention to the want of a quorum (Standing Order 45),
    3. the report by the Chairman of Committees that a quorum is not present in consequence of a report by the tellers of a division of the Committee or the counting of the Committee, and the Speaker orders the counting of the House (Standing Order 46 )- the Speaker may, if he is satisfied that there is likely to be a quorum within a reasonable time, announce that he will take the Chair at a stated time; if at that stated time there be not a quorum present the Speaker shall adjourn the House to the next sitting day.
  2. That the provisions of this resolution have effect notwithstanding anything contained in the standing orders.

Division Bells

  1. That, unless otherwise ordered, when successive divisions are taken, and there is no intervening debate after the first division, so much of the Standing Orders be suspended as would prevent the division bells for the ensuing division being rung for 1 minute only.

In response to the remarks of the Manager of Opposition Business in the House I say that I am quite sure that it will not be the sittings of the House that will preclude any debate later in this session on matters that relate to the Standing Orders. There was also in his remarks a comment regarding the report of the Committee on Committees. The principal difficulty has been the consideration of a paper which you have prepared, Mr Speaker, which back benchers severally have prepared and which the Committee on Committees has prepared as to determining the best manner by which legislation might be considered in this House other than that which is now provided for in the Standing Orders. I hope that that will proceed to the point where some trial Sessional Orders will be introduced with the agreement of honourable members and from that position we will then -

Mr SINCLAIR:
NCP/NP

-As I was saying, from members on both sides of the House. I hope that we will then be in the position where we can at one time introduce all the amendments to the Standing Orders. The reason that these proposals are being moved as Sessional Orders at the moment is because it is thought to be preferable that there be only one new printing of the Standing Orders. I hope that the others can be adopted during the course of this session.

Question resolved in the affirmative.

page 28

BRITISH MIGRANTS

Discussion of Matter of Public Importance

Mr SPEAKER:

– I have received a letter from the honourable member for Gellibrand (Mr Willis) proposing that a definite matter of public importance be submitted to the House for discussion, namely:

The attitude of the Fraser Government as exemplified by the statements of the Minister for Primary Industry regarding British migrants.

I call upon those members who approve of the proposed discussion to rise in their places.

More than the number of members required by the Standing Orders having risen in their places-

Mr WILLIS:
Gellibrand

-The Opposition has raised this matter for discussion today because it believes that this Parliament should consider at the earliest opportunity the appalling display of xenophobia exhibited by a senior Minister over the past week and a half. In a series of speeches, television and radio appearances and newspaper articles the Minister for Primary Industry (Mr Sinclair) has vented his prejudice against British migrants who engage in trade union affairs by blaming them for the dire economic straits into which this country is steadily sinking. In making these sinister accusations he has been undeterred by the complete lack of evidence to support his charges and apparently is in no way bothered by the thought that he may be fanning the flames of racial discord and intolerance, which could have devastating implications for a multi-racial society such as Australia is today. However, the Minister has not simply identified the problem as he sees it. He has, in his typically constructive and thoughtful way, proposed solutions to it. He strongly implied that Australian citizens of British origin who get themselves mixed up in strikes should be deported. He said:

Their interests are not Australian, their origins are not Australian, and one wonders whether action should not be taken against them.

The clear implication there is that he thought deportation should be applied. One of his more Neanderthal back benchers has since suggested that such deportations should be to the Soviet Union. On further consideration the Minister has recently proposed another solution, that migrants not be allowed to stand for trade union office until they have lived in this country for a number of years.

The Opposition is disgusted and alarmed that a senior Minister should be allowed to parade his fascist fantasies with the apparent approval of the Government he represents. Furthermore, his claim that he has had amazing support from his parliamentary colleagues for what he has been saying elevates this matter beyond the rankings of an individual Minister to the collective view of the Government parties. That is an extremely serious development in this country, but not altogether surprising. Indeed, it can be seen as the logical development of a campaign of scapegoating that his Government has been pursuing with increasing vigour as the economy collapses around it. As unemployment escalates to increasingly record levels, as inflation continues at double figure rates, as economic growth ceases, as farm income declines alarmingly, as our international reserves run down and as the value of the dollar is greatly depreciated, this Government is becoming increasingly desperate and in its desperation is increasingly anxious to pin the blame for its abysmal failures on the trade union movement.

Minister after Minister is reported in the Press as blaming the unions for the plight of the nation. The Prime Minister (Mr Malcolm Fraser) in particular fulminates periodically about the need for more legislation to control them. In conducting this vigorous and energetic campaign of buck passing the Government has been entirely undeterred by the fact that the official evidence of strike activity was showing, and continues to show, a very substantial decline in the level of strike action. The first statement by a Government spokesman in recognition of this fact came from the Minister for Employment and Industrial Relations (Mr Street) when he was not in Australia but in Japan. In addressing the JapanAustralia Society in June he was unable to resist the temptation to boast about the extent to which his Government had reduced industrial disputation in this country. He said that, if the rare event of the Medibank national stoppage was excluded, the time lost due to industrial stoppages in 1976 was the lowest since 1968 and that in the March quarter of this year the time lost was the lowest in a March quarter for 5 years and the number of employees involved was the lowest in 10 years, all of which, of course, is true. He was also unable to resist assuring the Japanese audience that the amount of time lost in industrial disputes in Australia was generally less than that due to industrial accidents. That also was true but had not been said by any Minister in Australia up until that time. But it was being said at that time in Japan, not here.

As all this seemed to be running rather counter to the Government’s developing union bash campaign we on this side of the House were interested to see which view would predominatewould the Government ignore these figures except when placating foreigners whom it wanted to invest here and pursue its union denigration campaign or would it change course, stop blaming the unions and emphasise its record in reducing industrial disputation? But the Government has had no trouble in coping with this quandary. It simply incorporated the decline in industrial stoppages into its extremely short list of achievements but continued full bore with its union bashing campaign.

Thus the Prime Minister (Mr Malcolm Fraser) has twice in the last 2 weeks managed to accuse the unions of wrecking the chances of economic recovery and in the course of the same speech to boast about the substantial diminution in the level of industrial disputation. This absolutely blatant attempt to score both ways on the industrial relations issue vividly exposes the paucity of this Government ‘s response to the abysmal economic mess it has created. Unable to abandon the ideologically appealing approach to blaming the unions it simply continues that line whilst also emphasising a totally contrary argument. Admittedly it is only the Prime Minister who has perfected this technique. Other Ministers are either totally disregarding the decline in industrial disputation, as is the case with the Minister for Primary Industry, and bashing unions with increasing vigour or, in the case of the Minister for Employment and Industrial Relations, a heavy emphasis is being placed on the figures to show what a good job he is doing.

The spate of attacks on British migrants by the Minister for Primary Industry last week cannot, therefore, be viewed in isolation. They must be seen as a crass extension of the general union bash campaign to a particular section of the trade union movement. But why has the Minister sought to extend the Government’s campaign in this way and to do it with such unbridled vigour? In our view it is not simply a matter of him being an enthusiastic supporter of the Government’s anti-union campaign.

There is another factor involved, and that is his own gross failure as a Minister in the eyes of the people he supposedly represents- the rural community. The fact is that the farming community is increasingly impatient with his Government’s failure to improve its lot, and well it may be. The Bureau of Agricultural Economics has forecast that in 1977-78 real farm income will decline by 14 per cent from its already low level. Whole sections of rural industry are being increasingly vocal in regard to their dissatisfaction with this Government’s performance. Just over a week ago at the time the Minister for Primary Industry launched his attack on British migrants Mr Barry Cassell, the Federal Director of the National Country Party, announced he was leaving that job to become National Director of the Cattlemen’s Union of Australia, an organisation that has been trenchantly critical of the Government. The statements Mr Cassell made on leaving the National Country Party showed that he was far from satisfied with its performance in government. An article in the Melbourne Age of 8 August 1977 stated:

The retiring Federal director of the National Country Party, Mr Barry Cassell, yesterday attacked the party for ‘ forgetting its basic ideology ‘.

Mr Cassell said the NCP had given too much attention to the mining industry at the expense of beef producers. ‘Australia’s cattlemen have had a gutful ‘, he said. ‘The party has forgotten its basic ideology and needs to be reminded of the plight of the cattle industry’.

The fact that the ex-Federal Director of the National Country Party is disenchanted with the Government regarding its rural policy and regards it as being too concerned with the mining industry at the expense of its traditional supporters gives some idea of the extent of dissatisfaction that exists in the rural community with the Government and in particular with the Minister who is responsible for policy in that areathe Minister for Primary Industry, the man who has been so vocal lately.

It is surely no coincidence that that Minister’s sudden insight into the cause of our economic problems and his frenzied attempts to spread the message over the last week or so occurred concurrently with the revelation of major dissatisfaction with his performance within his own Party. Nor did his rantings about the British disease cut any ice with those who understand rural problems and are concerned to see policy initiatives undertaken to solve them. I quote from an article which appeared in the Melbourne Age of 1 5 August. It stated:

The Federal Government should stop bashing the unions and the British, a leader of the beef industry said yesterday.

The National director of the Cattlemen’s Union, Mr Barry Cassell -

The man who just over a week ago was the Federal Director of the National Country Party- . . . Said the negative approach should be replaced by positive policy initiatives.

Mr Cassell resigned as director of the National Party a week ago to take up the cattlemen ‘s post.

His criticism of the Government is a direct reference to the political storm created last week by the National Country Party Deputy Leader, Mr Sinclair.

So there we have the ex-Federal Director of the National Country Party just over a week ago publicly saying that this campaign of denigration of the trade union movement and the British should stop. Mr Cassell ‘s comments demonstrate the patheticness of the Minister’s campaign against British migrants. His comments were clearly motivated by the desire to be seen to be doing something to help the farmers. But, as Mr Cassell said, it is totally negative and totally lacking in positive policy measures to assist the rural industries.

But it is not just a matter of buck passing and negativism. These comments may well have a decidedly harmful effect on community relations in this country. My colleague the honourable member for Melbourne (Mr Innes) will elaborate on this point. But I make the point now that we on this side of the House are greatly concerned that for narrow political purposes a Minister is prepared to make comments that promote racism in this country. The cheapest political response to any problem is to blame some section of the community. But when that section is narrowed to a racial group and totally unsubstantiated sweeping allegations are made in regard to them, one is playing with fire, particularly in a multi-racial society such as ours. Such simplistic notions can be attractive to people who are desperate to find solutions to our problems and eager to believe that those problems are all due to some group. If that becomes a widespread belief then the basis for racialism, discrimination and perhaps worse is established. Furthermore, by calling for deportation or discriminatory treatment for British migrants because of their participation in trade union affairs, the Minister not only offends the British born but all the nonBritish migrants who are made to realise that they are still regarded as different from Australian-born citizens by some people in power and therefore liable to be denounced or discriminated against. I remind the House that there are three million migrants in Australia and one million children of migrants. That is a large section of our community. All of them must have been deeply disturbed by the events of last week. For some it would have been an uncomfortable reminder of what unscrupulous politicians in Europe were saying 40 years ago.

The Minister’s statement also demonstrates colossal ignorance of industrial relations. He assumes, as do all his colleagues judging from their public statements, that strikes occur because evil-minded union officials or shop stewards are trying to disrupt industry simply for political purposes. The Minister and his colleagues never stop to think-if they do they never acknowledgethat two sides are involved in industrial relations and that a high level of strikes indicates bad industrial relations but says nothing about the cause. As we have been talking about the British disease, so described by the Minister for Primary Industry, I refer to an article which appeared in a German magazine Der Spiegel on 1 August. The article assessed the view of German managers of German companies operating in Britain of the situation in England. It states:

German managers representing their firms in England have a quite different picture of the ‘English Disease’. They put major blame on their English manager colleagues. In the opinion of the German managers, if the English worker is correctly approached he is willing to work.

I stress those comments. The German managers stressed that in their opinion it is their English manager colleagues who are to blame for the industrial relations problems in that country. The article goes on to make the point that the German manager in Britain sees poor management, inadequate investment and insensitive industrial relations as the cause of the so-called British disease; not the British workers or their unions. So for God’s sake let us realise that there are two sides to industrial relations. I think the Government’s campaign of denigrating unions because of strikes totally misses the point. Of course, the Government is not interested in discussing the point that there are two sides and that if one simply union bashes this may have extraordinary negative reactions and adverse effects on the community. This point has been picked up by Rydge’s magazine which recently reported a study of industrial relations in the Pilbara region by a woman who turned out to be the daughterinlaw of the Premier of Western Australia, Sir Charles Court. This woman, Mrs Court, found that the major reason for bad industrial relations in the Pilbara was not that there were evilminded trade union officials operating there but that management was largely the cause. Rydge’s magazine went on in that article to state:

Union bashing may be all very well for election purposes but its real danger is that it thoroughly confuses the reality of industrial relations in this country and contributes to disharmony and lost production.

Mr DEPUTY SPEAKER (Mr Lucock)Order! The honourable member’s time has expired.

Mr SINCLAIR:
Minister for Primary Industry · New England · NCP/NP

– It is unfortunate that the honourable member for Gellibrand (Mr Willis) in pursuing his epithets and cliches and in trying in some way to answer a cause which he knows is lost, has really not identified and accepted the consequences and the implications of the narrow application of the statement which I made in five sentences at page 5 of a fairly complex speech relating to some of the problems of primary industry. The speech was made in a small country town; in a very rich agricultural region it is true. It was made following the presentation of a publication by the Bureau of Agricultural Economics concerning June trends. In that article the Bureau estimated that the real income per farm was expected to fall by as much as 14 per cent during the next 12-month period. From that I went to analyse some of the factors which were contributing to low incomes for farmers. Among those factors- it was not the only one- I identified a spread of industrial disputes. At the conclusion of my remarks I shall table this document which sets out industrial disputes as they affected primary industry from 1 July 1976 to 30 June 1977. It is an appalling list of incidents where, not as a result of industrial disputes but, in many instances, peculiarly politically based attacks, there has been a disruption of income which should be flowing back to primary producers.

As if that were not enough, only today I have had a report that in the rice industry there is a dispute between the Federated Storemen and Packers Union and the Federated Millers and Mill Employees Association, as a result of which it seems that 1 100 tons of bagged rice destined for Papua New Guinea and a cargo of 20 000 tons due to be loaded at Portland will not be loaded. It seems that the bans will cause significant unemployment in Echuca and Deniliquin. It is not only the rice growers who will suffer but also the very men whom honourable members on the other side purport to represent-the very men whom trade union leaders are supposed to represent. They are the ones who are suffering. That, of course, was the meat in my message. Let me state again what I said. There are a number of factors which prejudice the recovery of the Australian economy. As far as the rural sector is concerned, there are a number of consequences of industrial disputes, among other factors, which are prejudicing the level of income for those who are at the moment unfortunately amongst the lowest in expectation generally in average weekly earnings.

It is in those circumstances that nobody wants to deny that there are factors which we need to do something to correct. I have not peculiarly identified one sector. I shall come back to the British disease in a moment. What I have done is say that there are communist Australian trade union leaders. I have referred to radical left wing trade union leaders. Many of them are supported and fostered by members of the Australian Labor Party in this House and elsewhere in Australia. These people are intent not just on pursuing industrial action but on pursuing political action which, for example, has led to a complete embargo on the shipment of wheat to Chile. I am told that today Chile is one of the principal markets of East Germany. So apparently communists on the other side of the world are able to take advantage of the market but not the Australian wheat growers. The end product is not that Australian labour in any way receives a benefit, but that the individuals who are being led by the nose find that they have fewer job opportunities. That is really the background behind the statement I made.

It also needs to be said that there are a number of factors within the trade union movement about which we need to be concerned. Of course it is not peculiar that I have referred to the British disease. That is not something original. It has been referred to by many august authorities around Australia and around the world. I point out to those on the other side of the chamber who pretend that I am saying something racist and pursuing a vendetta against all British migrants, that that is arrant nonsense. In fact, many British migrants left Britain to come here to escape the same shop stewards who they find, to their regret, have followed them here. In fact, most British migrants have contributed enormously to the wellbeing of this country. They have been the lifeblood of this country. The honourable member for Gellibrand suggests that I have said ‘Deport them ‘. I did not say that. He read that into a speech. I did not say that. At no stage have I said that they should be deported. What I have said is that there are a few things that can be done within the trade union movement.

Mr Young:

-What? Deport them?

Mr SINCLAIR:

-I will be happy to answer that question. I hope that one thing which will happen is that more Australian trade unionists will start participating in trade union affairs. I hope that they will participate not just in registering a vote but in seeking an appointment within the hierarchy of the trade union movement.

Mr Young:

– What about shareholders?

Mr SINCLAIR:

-Even though the honourable member who is now interjecting does not agree, he realises that the fractionalising of the Australian trade union movement which has taken place as a result of the intervention of British shop stewards, has been rejected by many of those who are significant Australian trade union leaders. Let me quote from The British Disease by Professor G. C. Allen, Emeritus Professor of Political Economy at the University of London. Amongst other things, he stated:

Trade unions and management should abandon thenpresent obsolete institutional arrangements and learn from countries where industrial relations are harmonious.

He was referring to Britain, and he said a good deal more; but the problem is not peculiar to Britain. I could refer to a good many more authorities. It is interesting, for example, to refer to Mr Fred Nicol, the Federal President of the Storemen and Packers Union. In an article in the Sun on 3 September 1976 he blasted some

English migrant workers as being disruptive and antagonistic towards the union. He said:

They have their own peculiar independent attitudes and don’t try to slot in with the rest of the workforce . . .

They insist on telling us all about England, how good it is there and how to run industrial affairs.

They have become some of the biggest disrupters we have ever encountered.

So, this is not something that has been said peculiarly by me. Indeed, many British migrants nave written to me, communicated with me, and said that they too are concerned. It is true that the British disease does not exist only in the trade union movement, but it is important that we register its effect in the trade union movement. One letter I received from a gentleman in Victoria stated:

I work in an industry, which, in Victoria, employs approximately 5000 people, and at least 90 per cent of all shop delegates are of British origin. Only a handful are Australian or Maltese.

In our industry ‘pommie’ shop stewards have been and still are the biggest thorn in the backside of management. They are the most militant, most uncompromising, and most meddlesome pack of people we have ever known.

The extent of our problem has been so bad that at one stage we had a complete embargo on the hiring of anyone of British origin.

I am endeavouring to point out to the honourable member for Gellibrand that these remarks are not racist in origin; they are not union bashing, much as he likes to use that phrase. Rather, they are intended to identify some of the problems within the Australian community which need to be corrected if we are again to establish Australia as the sort of country it was pre- 1972, before he and his friends and colleagues made a mess of it. If the honourable member thinks that the remarks I made are without support, I suggest that he look at a poll that was conducted by Channel 7, Melbourne, last Thursday and Friday, when 26 32 1 people voted in support of my remarks and 1 1 305 voted against them.

Even within the hierarchy of the trade union movement there are people who very strongly support the remarks I made. It is important that we realise that the remarks were made in a narrow but very pertinent context. In ‘An Overview of the Problems of Migrants Workers’- a paper delivered by Dr June M. Hearn in an industrial relations program at the University of Melbourne in July 1976- she mentioned the Ford workers strike in Victoria in 1973 as a graphic illustration of union leaders being completely out of touch with their rank and file, who were mainly southern European. She referred to union shop stewards: . . . being forced to admit publicly their ignorance of migrant workers’ needs that went far beyond claims for increased wages.

She also said:

Similarly, in the same industry in South Australia in the early 1970s, migrant (predominantly British) workers were involved in repeated unofficial stoppages and alleged acts of industrial sabotage. The pommie shop-steward stirrer’ stereotype - these are not my words; these are Dr Hearn’s words- has been grossly exaggerated but, in some industries, particularly the metal trades, the incidence of Britishers as job delegates is quite marked, especially in regions of heavy migrant concentration, for example, the La Trobe Valley in Victoria. Many British migrant unionists, unencumbered by a language barrier, familiar with similar trade union institutions and practices in Britain and often schooled in a union system that relies heavily on strong shop-committee organisation, have been responsible for a substantial militant input into the Australian trade union scene.

Dr Stephen Haseler, a British Labour member of parliament and the author of the book The Death of British Democracy, in his seventh Sir Robert Menzies Lecture in Perth said:

Britain’s decline as a nation coincided, maybe not without reason, with the rise of the socialist generation.

There we have the link with the philosophers of the Left, and there are many others. Let me quote Mr Paul Johnson, British socialist and editor of the New Statesman magazine, who visited Australia last year. He said that the main cause of Britain’s current economic ills was the union monopoly. He said that unionists were so entrenched in key industries that they could raise wages to the level where viability of industry was threatened and in some cases destroyed. Mr Johnson said the same structures and practices of trade unions existed in Australia and there was no reason why we should be immune to the developments that have afflicted England.

Tragically, so many remarks of this kind have been made that it is important for people to realise that these practices are pernicious. They do affect industrial harmony and they do affect economic recovery. Mr Paul Johnson said in the New Statesman:

The tragic truth is that British socialism has had a devastating case to make out against postwar union leadership. Men ought to be judged by their record, and their record is contemptible, smug and self-assured, oblivious of any criticism. They have encouraged British industrial workers in habits and attitudes, in rules and procedures, in illusions and fantasies, which have turned the British working class into the coolies of the Western world and Britain into a stinking bankrupt industrial slum.

I hope, as we all do, that the British economy will recover, but those who see the harmful effects of some elements of the economy equally need to be listened to. The Chairman of the Fabian movement has said:

The direct total social gain from industrial action was not merely negligible, it might well have been negative. Neither in this country nor anywhere else - he was speaking of Britain- have trade unions been able to increase the share of wages and total national income. The increase in money wages has been frustrated by rising money prices. These rob the wage earner or his wife of the expected gain. Frustration and anger are the result. The indirect loss due to the resultant worsening of the balance of payments and the enforced slow-down of expansion was on the contrary immense. The crocodile tears shed by some about the fate of the low paid workers, the unemployed, the sick and the old is surely disingenuous. It is trade union action which through wage induced price movements has created the basic problem.

Tragically, there is a British disease. The British disease does not affect everybody. The British disease, as I have spoken of it, affects a few. It affects a few employees and a few in management. It is one of those elements which unfortunately have contributed to the rundown of the British economy. I hope that the British economy is on the mend and that the optimistic forecasts of the British High Commission will be realised. But my concern is not with Britain; it is with Australia. My concern is with the effect that industrial lawlessness has had on the incomes of the Australian community, on the maintenance of industrial harmony and on re-employment in this country. The former Labor Treasurer, the honourable member for Melbourne Ports (Mr Crean), shortly after his appointment as Treasurer remarked that one man’s pay increase can well be another man’s job, and how pertinent that is.

The whole reason for the campaign that I have been conducting is not to damn any one individual but to talk about those factors which have prejudiced economic recovery and are delaying re-employment in this country. If Australia is to recover we need to generate new employment opportunities. We need to minimise industrial lawlessness. We need to ensure that both management and trade union members coordinate and co-operate to regenerate this country so that those who are at the end of the line, such as the farmers I represent, are not totally disadvantaged. There is no doubt that the few words I spoke in five sentences at Tanunda nearly a fortnight ago have echoed around every town, village and community in Australia. They have won enormous support, and they have won support because they identified a basic problem. It is only the few; but, if we can correct the problems that those few have generated, I believe that our whole economy will be regenerated in a way which will contribute towards the realisation of what the Treasurer (Mr Lynch) will put forward in his Budget Speech tonight.

Mr DEPUTY SPEAKER (Mr Lucock)Order! The Minister’s time has expired.

Mr INNES:
Melbourne

– I rise to support the matter of public importance raised by the honourable member for Gellibrand (Mr Willis). It is obvious that the Minister for Primary Industry (Mr Sinclair) is unrepentant about the deliberate, outrageous, vile, detestable attack he made on workers in this country, in particular migrant workers. The Minister has claimed that the speech was made to a small group of people in a country town, but in fact copies of the speech were put into the Press boxes in the Press Gallery in Parliament House and therefore it was meant to get the publicity it did. Further, the Minister quoted a statement by Dr Hearn as supporting his stand. In the Melbourne . Sun on 1 1 August an article appeared under the headline ‘Sinclair gets a blast. Produce facts- expert’. The Minister has not produced any facts today. His claims have been biased and unsubstantiated. Dr Hearn is quoted as saying, amongst other things:

All Australians would do themselves a lot more credit if they examined the causes of conflict rather than blame British migrants.

She is further quoted as saying:

Australia can ill-afford to fan the flames of racial tension.

That is what Dr Hearn thinks about the Minister’s remarks. I will have a few words to say about all these people the Minister has won to his side in a few moments. This is the action of a desperate individual whose long history of vicious union bashing is well known. The depths of degradation to which he and his colleagues will sink in order to take the heat off the Government for its abysmal failure to add up as a government are hard to imagine. Having weakened the economy- deliberately wrecked it- and deliberately created record unemployment levels, they are now callously and deliberately imposing the burden of their inadequacies on the backs of workers- in particular, migrant workers in this country. This phoney attempt to shift the blame from the Government is being exposed day after day by people in the community who are demanding that the Government get on with the job. The outburst by the Deputy Leader of the National Country Party has brought to the light of day the evil and vicious intent underlying the Government’s tactics in this matter. He talks in terms of having the support of individuals in country organisations. But my friend, the honourable member for Gellibrand, referred to Mr Cassell who was, until a few days ago, an official of the National Country Party. He made certain remarks in the newspaper Stock and Land. I wonder how much support the Government and in particular the Minister is getting from the Cattlemen’s Union of Australia which Mr Cassell now heads. He said:

The union has been militant, favouring direct action. … Mr Cassell has said that his union represents ‘desperate men’ who regard militancy as the best weapon to force government action.

He said: ‘If things are not going well and we do not get a reasonable response to our pleas, we will be forced to be far more aggressive.

That could mean withholding stock from the market and other forms of direct action*.

I wonder what category Mr Cassell would come into? If he happened to be a British migrant, would he be sought out for special attention? I wonder whether he would be deported.

To ensure that Mr Cassell ‘s statement is regarded as taking the Minister to task about his union bashing, let me quote from a Press release- it is not a comment- signed by Barry Cassell and dated Sunday, 14 August 1977. He talks about Tuesday night’s Budget as an opportunity for the Federal Government to reduce the burden on country Australia. He said that to do this, 3 key elements are necessary, including redistribution away from country people of some of the unfair costs of controlling inflation. The third point he makes is that there should be positive policy initiatives to replace negative British and union bashing. What Mr Cassell thinks about the actions and the ravings of the Minister is well defined in his statement. The Minister’s tactics are a desperate attempt to hoodwink the Australian people; to take the minds of people off the further attack that undoubtedly will be made on the living standards of Australian workers in the Budget to be delivered this evening by the prince of posers, the Treasurer (Mr Lynch). The tactics are doomed to failure, however, because the people of this country have had enough of this Government’s incompetence and dishonesty. Mr Sinclair has not proved his allegations that the British disease, whatever that is, has been imported into Australia, nor has he said who imported it. On the contrary, the figures show the real position. Let me state the position in respect to the working days lost and show how the position deteriorated in 1977. The number of working days lost in 1976 due to industrial action represented 70 per cent of the total figure. In 1975 it was 45 per cent and in 1974 it was 40 per cent. It is interesting to note that this represents less than 1 hour, 57 minutes and 12 seconds, to be precise, for each member of the work force. More working days are lost in Australia due to the common cold. Mr Sinclair has not proved his argument because he cannot prove, any more than the Prime Minister (Mr Malcolm Fraser) or any of his Ministers can, that there has been an inordinate amount of industrial unrest in Australia. The Prime Minister cannot prove it because the facts tell a different story, as I have indicated. But it suited Mr Sinclair to pick out some phrases that he found temporarily appealing and to voice it about the countryside. It is an old technique of taking a lie or a half truth and repeating it ad nauseam in the hope that some people might find it convenient to believe it. Mr Sinclair has certainly managed to flush out the fascists in our society.

Mr DEPUTY SPEAKER (Mr Lucock)Order! Is the honourable member quoting from material? If not, he should refer to the honourable member as the Minister for Primary Industry.

Mr INNES:

– It is the old technique of taking a lie or a half truth and repeating it. This has been done by the Deputy Leader of the National Country Party. He thought that the deportation of a few British unionists would solve the problem. But this was not enough for some of his followers. He gathered around him all these elements in the community. One of these followers was interviewed on the television program This Day Tonight last week. She thought that deportation was not good enough. This wealthy Sydney dowager, Lady Braddon, thought that the penalty should be something more final. She did not want to say what she meant by that, but plainly she was implying something along the lines of shooting being too good for them. That is the sort of situation that is created by the irresponsible statements of the Minister.

Migrant workers, in particular British migrant workers, are being sought out for special treatment. They will have the threat of deportation hanging over their heads like the sword of Damocles. This is what is happening. It is designed to create tame cat unions so that they are easy prey for the people who support this Government. The Minister for Immigration and Ethnic Affairs (Mr MacKellar) who will follow me in the debate must dissociate himself from the remarks of the Minister for Primary Industry. On the issue of deportation, he has to guarantee migrants in this country that the threat of deportation will not be used as a weapon against individuals. The Minister for Immigration and Ethnic Affairs shakes his head. He has an obligation to do as I suggest.

Mr MacKellar:

– Do not get excited.

Mr INNES:

-It is not a matter of getting excited. The patronising way in which the Minister answered a question I asked him this afternoon about citizenship is indicative of his attitude. For instance, I nope that the deportation sections of the Immigration Act are not implemented in accordance with the wishes of the Deputy Leader of the National Country Party. I hope that the Minister will not exercise his discretion in the way he did when dealing with the representations of an Italian worker, Mr Salemi who is still under threat of deportation, notwithstanding that three High Court judges indicated that there had been a denial of natural justice and that the other three High Court judges were of the opinion that Mr Salemi had been treated unfairly and that the concept of natural justice did not apply in the administration of the Minister’s decision under the Immigration Act. The Minister must stand up and be counted. He has to say that justice will apply. In the case of Mr Salemi. I wonder whether the Minister can guarantee a reference under the Administrative Decisions (Judicial Review) Act which has been passed but which still has not been proclaimed? I believe it has not been proclaimed because Ministers like the Minister for Immigration and Ethnic Affairs want to write into the legislation sections which would not preclude the operation of section 14, of the migration section. I also want a guarantee that this will not happen. The Minister must also stand up and assure migrant workers in this country that this legislation will not be used as a bludgeon to batter them into submission and make them pawns in the game of chess played by the employer organisations represented by honourable members on the government benches.

Mr DEPUTY SPEAKER:

– Order! The honourable member’s time has expired.

Mr MacKELLAR:
Minister for Immigration and Ethnic Affairs · Warringah · LP

– We have just been treated to a typical performance by the honourable member for Melbourne (Mr Innes).

Mr Jull:

– It was not much good.

Mr MacKELLAR:

– As the honourable member for Bowman says, it was not much good. He characterised his speech by the use of emotional and high-flown phrases. Let me remind the House of a few of them. He claimed there had been an attack on migrant workers- there has been no such thing; union bashing- there has been no such thing; evil and vicious intent- there has been no such thing; and ravings. The only ravings I heard this afternoon came from the Opposition members when they talked about what the Minister for Primary Industry (Mr Sinclair) meant by his statement in a speech he made recently in South Australia.

I want to deal with one thing right at the start. Both the speakers for the Opposition have reiterated the untruth that the Minister for Primary Industry talked about the deportation of migrants who have taken part in union activities. The Minister clearly refuted that statement, but that did not deter the honourable member for Melbourne one iota. He spent half his speech talking about the deportation that he claimed the Minister for Primary Industry had talked about. The fact of the matter is that the Minister for Primary Industry never talked about deportation. I should like to make one thing perfectly clear to the Opposition, to listeners to the broadcast of these proceedings, to migrants in this country and to the House: The Migration Act 1958 confers power for the deportation of persons who have not become Australian citizens in certain defined circumstances. In summary, those powers can be invoked only when a person granted permanent entry, not having become a constituent member of the Australian community, has been convicted for crime, or subject to the right of appeal to a commissioner, on grounds of unsatisfactory conduct generally. There is no intention to change that situation. Obviously, all this talk about the deportation of people taking part in union activities is a figment of the imagination of the Opposition. It is deliberately trying to frighten migrants by this talk of deportation. I have just read out the Migration Act 1 958 and how it is administered.

Mr Innes:

– It is your responsibility. It is your discretion. Do not hide behind the Act. Give us your guarantee.

Mr DEPUTY SPEAKER (Mr Lucock)Order! The honourable member for Melbourne has made his speech. I suggest that he should cease interjecting.

Mr Young:

– I think the Minister is telling the House untruths.

Mr DEPUTY SPEAKER:

-Order! The honourable member for Port Adelaide will not be in the House to listen.

Mr Young:

– The Minister who spoke before him said that he was going to deport them.

Mr MacKELLAR:

-I want that withdrawn immediately, Mr Deputy Speaker. I have not told the House any untruth. I have read out the provisions of the Migration Act and how it is being applied. It is absolute nonsense for the speakers for the Opposition to try to frighten people who have come to make their homes in this country by putting up these shibboleths that this Government is thinking of deporting people for taking part -

Mr Innes:

-Well, deny it.

Mr MacKELLAR:

-I am denying it right now. I should like to move to the subject of migration because that is my area of responsibility. I think it is appropriate that I should talk about the matter of public importance as it affects migrants, particularly British migrants. It is a simple matter of fact that people from the United Kingdom and Eire have formed the backbone of the immigration program for many years. More than one and a half million British migrants have come to Australia since 1947 and have made a magnificent contribution to the development of Australia. That has been acknowledged by this Government and by the Minister for Primary Industry. As with many migrants, British migrants have played a big part in Australia’s postwar progress and in our economic, social, political and cultural development. As the largest migrant group, it is not surprising that British migrants have risen in prominence m many areas of Australian activity- in the professions, industry and commerce, politics, the academic world, the arts, sport, employer organisations, trade unions and the Public Service.

We have a policy, which has been pursued by successive governments, of saying that when people come to make their homes in Australia they should bring to Australia the good things of their country of origin and leave behind the negative aspects. This has been brought up by the Minister for Primary Industry in a number of statements over the past few weeks. It must be obvious to everybody that with an influx of over three million people since the end of the Second World War some of the migrants from various countries- not one particular country- will not fit into the Australian scene as well as the majority. The vast majority of migrants from all countries have adapted to the distinctive Australian industrial relations and the political and cultural scenes and have helped in their evolution. I should like to pay tribute to the migrants from over one hundred different source countries throughout the world for the contribution they have made, are making and will continue to make. Their impact on the work force has been considerable and critical to the success of many industries.

The latest detailed occupational figures I have come from the 1 97 1 census. At that time the total number of persons employed was 5.24 million, of which 541,000, or 10.3 per cent, were born in the United Kingdom and Eire. The emphasis on the role of the overseas born in industry tends to obscure the fact that the overseas born in general and the United Kingdom born in particular have enriched our level of skills in all occupations. For example, at the time of the 1971 census over 10 per cent of the United Kingdom and Eire born males in the work force were in professional, technical and related occupations, compared with 8.7 per cent of the Australian born male work force. At that time 2.5 per cent of the United Kingdom and Eire born males were engaged as skilled metal and electrical tradesmen, compared with 1.7 per cent of Australian born males. This trend is evident also in other skilled areas. At that time 2.4 per cent of the United Kingdom and Ireland born males were engaged in carpentry and woodwork, compared with 1.7 per cent of Australian born males; 2.1 per cent of United Kingdom and Ireland born males were engaged as bricklayers, compared with 1.1 per cent of Australian born males; and 1.3 per cent of United Kingdom and Ireland born males were engaged as trademen and painters, compared with 0.6 per cent of Australian born males. These statistics overwhelmingly confirm the significant role that British migrants have played in the Australian work force. It is a continuing role which this Government and, I am sure, the people of Australia recognise and appreciate.

A more recent survey of the work force which was carried out by the Australian Bureau of Statistics in November 1974 examined the educational status of the civilian labour force. Of all the United Kingdom and Ireland born males 43.7 per cent had post-school qualifications, that is, a degree, diploma, trade certificate, et cetera, compared with 28.8 per cent of all overseas born, 32.6 per cent of the Australian born males and 34.4 per cent of the total male work force. It is absolutely hypocritical for this Opposition to say in this House that it supports migrants. It is a fact that under its administration the numbers of British migrants coming to this country were overwhelmingly reduced. One of the first actions I took as the Minister for Immigration and Ethnic Affairs was to go to the United Kingdom in May last year, which was the first visit by a Minister of the Fraser Government to the United Kingdom, to reassure them that Australia did not- I emphasise these words- have an antipathy towards the British migrants but that in fact we welcomed them. I repeat that it is hypocritical of the honourable member for Melbourne, the honourable member for Gellibrand (Mr Willis) and members of the Opposition generally to claim here, with their hearts on their sleeves, that they are defending the British migrants. That is absolute nonsense. By their actions they shall be known. Their actions were significantly against British migrants coming to Australia during the time of their administration.

Obviously an attempt is being made to paint the Fraser Government as anti-migrant. It is not anti-migrant; in fact, it is pro-migrant. This can be demonstrated quite easily and conclusively. It was the Labor Government which disbanded the Department of Immigration and incorporated it in die Department of Labour and Immigration. It was the Fraser Liberal-National Country Party Government which set up the new Department of Immigration and Ethnic Affairs. We have increased the number of migrants coming to Australia. During the Labor Administration the lowest number of migrants since 1947 came to Australia. What a record to be proud of that is. Yet here we hear the Opposition pretending to be concerned about migrants. It is anti-migrant; it has always been anti-migrant.

A number of additional measures have been brought in by this Government. The family reunion conditions have been broadened. Additional to occupational categories entrepreneurs and smaller entrepreneurs have been brought in. We have had special Indo-Chinese refugees projects, special arrangements for the migration of Lebanese, amnesty for illegal migrants, the abolition of re-entry visas, the establishment of an ethnic affairs branch, the establishment of the national accreditation authority for interpreters and translators, migrant resource centres, the establishment of the Australian Population and Immigration Council, the Australian Ethnic Affairs Council and the establishment of a permanent broadcasting authority which provides a special broadcasting service to cater for the rights of ethnic radio. There is the National Ethnic Broadcasting Advisory Council, and I could go on.

Mr DEPUTY SPEAKER (Mr Lucock)Order! The Minister’s time has expired.

Mr MacKellar:

– May I table the paper referred to by the Minister for Primary Industry?

Mr Innes:

– No.

Mr DEPUTY SPEAKER:

-Yes. A Minister may table a paper at any time. The discussion is now concluded. May I comment that it is a pity that the parties were not able to persuade Geoff Boycott to become an Australian citizen.

page 38

TARIFF PROPOSALS

Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP

– I move:

Customs TariffProposals Nos 16 to 23 (1977)

The Customs tariff proposals I have just tabled relate to proposed alterations to the Customs Tariff Act 1966. These proposals formally place before Parliament, as required by law, tariff changes introduced by Gazette notices during the last recess. These changes arise from the Government ‘s decisions on recommendations by the Industries Assistance Commission in its reports on:

Pharmaceutical and Veterinary Products;

Plywood and Veneer (Thick Plywood)- Interim Report;

Sacks, Bags and Certain Polyolefin Fabrics;

Primary Batteries;

Children’s Knitted Tracksuits, Playsuits, Rompersuits and like Garments- Tariff Quotas;

Tyres;

Electrical Control Apparatus and Insulating Fittings;

Pumps and Compressors;

Brassieres;

Certain Paper and Paperboard; and by the Temporary Assistance Authority in its reports on:

Ceramic Floor and Wall Tiles; and Carpets

Also included in these proposals are changes of an administrative nature following recent decisions of the Administrative Appeals Tribunal and the High Court of Australia. In view of the numerous reports involved, I do not propose to detail the contents of each of the proposals. I have had prepared a comprehensive summary setting out the nature of the changes in the duty rates and the origin of each of the alterations contained in the proposals. This summary is now being circulated to honourable members. I commend the proposals to the House.

Debate (on motion by Mr Young) adjourned.

page 38

EXCISE TARIFF PROPOSALS

Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP

– I move:

Excise TariffProposals (No. 1) 1977.

The excise tariff proposals I have just tabled relate to a proposed alteration to the Excise

Tariff 1921. These proposals formally place before Parliament, as required by law, a tariff change introduced by a Gazette notice on 30 June 1977 and which, with effect from 1 July 1977, increased from 4.3c to 10c per tonne, the excise duty on coal, not being the property of a State or brown coal produced by open cut methods. The excise duty is applied to the Coal Mining Industry Long Service Leave Trust Fund set up under the States Grants (Coal Mining Industry Long Service Leave) Act 1 949 administered by my colleague, the Minister for Employment and Industrial Relations (Mr Street). A summary setting out reasons for the increase has been circulated to honourable members. I commend the proposals.

Debate (on motion by Mr Young) adjourned.

page 38

TARIFF PROPOSALS

Discharge of Items

Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP

– 1 ask for leave of the House to move a motion to discharge certain tariff proposals which were moved earlier in the year and which constitute part of Order of the Day No. 15. These proposals were incorporated in the Customs Tariff Amendment Bill 1977 which has now been assented to.

Mr DEPUTY SPEAKER:

-Is leave granted? There being no objection, leave is granted.

Mr FIFE:

– I move:

That Customs TariffProposals Nos 6 to 10 (1977) constituting part of Order of the Day No. 15, Government Business, be discharged.

Question resolved in the affirmative.

page 38

INTERNATIONAL DEVELOPMENT ASSOCIATION (FURTHER PAYMENT) BILL 1977

Second Reading

Debate resumed from 5 May, on motion by Mr Peacock:

That the Bill be now read a second time.

Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP

– May I have the indulgence of the House to raise a point of procedure on this legislation. Before the debate is resumed on this Bill, I suggest that it may suit the convenience of the House to have a general debate covering this Bill and the International Fund for Agricultural Development Bill 1977 as they are associated measures. Separate questions will, of course, be put on each of the Bills at the conclusion of the debate. I suggest therefore, Mr Deputy Speaker, that you permit the subject matter of both Bills to be discussed in this debate.

Mr DEPUTY SPEAKER (Mr Giles:
ANGAS, SOUTH AUSTRALIA

-Is it the wish of the House to have a general debate covering those two measures? There being no objection, I will allow that course to be followed.

Mr HAYDEN:
Oxley

-The first of the two Bills before the House provides for our contribution to the fifth replenishment for the International Development Association and the other provides for the Australian Government’s contribution to the establishment of the International Fund for Agricultural Development. As the purposes of the Bills and the funding were outlined by the Minister for Foreign Affairs (Mr Peacock) in his second reading speeches, I do not propose to go over the purposes of the two funds or to extol the virtues at least of the International Development Association’s programs or to speculate very far about the International Fund for Agricultural Development.

I have noted in reading, from overseas sources, related to this matter that there seems to be a fairly strong suspicion that the International Fund for Agricultural Development was established as a concession to pressure from developing countries especially for the initiation of a common fund as part of a new international economic order. It is suggested by leaders of some developing countries, perhaps displaying a similar bent of mind and a cynicism which is no doubt the product of so many frustrations and disappointed hopes at the hands of promises scarcely fulfilled by developed countries, that the concession was originally initiated by Dr Kissinger to buy off pressure from the spokesmen for the developing countries. In any event, it does seem that there is a considerable degree of scepticism among many of the developing countries over just how helpful the International Fund for Agricultural Development is to be in terms of the massive problems which confront developing countries today.

There has been a great deal of disillusionment in the world about aid for developing countries and what is going to be achieved. I must confess to some disenchantment myself. I remember when I came into this Parliament some 16 years ago that there was then so much hope as to what could be achieved if only the rich countries would make the appropriate sacrifices to allow redistribution of command over resources to benefit the developing countries. All sorts of optimistic speculations were put forward about what could be achieved and how the poor countries could be released from their imprisonment within poverty. It was common then to talk about the one per cent decade of development. At the end of that period, one per cent of the gross national product of the developed countries was to be contributed to the developing countries for their needs. Some 16 years later the most we can achieve according to the official statistics on development aid from developed countries is an average of 0.36 per cent of one per cent of the gross national products of those developed countries. Of course, there is quite a range of contributions from various countries providing aid but it is disappointing to note that two particularly strong economies, Japan and the United States of America, are contributing respectively 0.24 per cent and 0.27 per cent of gross national product in the form of official development assistance to developing countries.

Mr Fife:

– They have now undertaken to do more.

Mr HAYDEN:

-The Minister interjects that they have now undertaken to contribute more but they could contribute a lot more and still not be impressive when their contributions are compared with what is contributed by other countries. By and large our own record, although still short of what we desire to achieve, is not bad compared with many other countries and is a long way ahead of those much larger and considerably wealthier countries in terms of the size of their economies. The elusive one per cent contribution for the development of the underdeveloped countries is as elusive now as it ever was, if not even more elusive. The poorest countries are staying that way while the wealthiest are getting much wealthier.

Between 1965 and 1975 the immense disparity in per capita income between the poorest nations and the developed nations worsened. Theoorest nations, that is countries with less than 200 per capita have 43 per cent of the world’s population. The developed nations have 25 per cent. In 1965 the poorest nations had a per capita income of only 3 per cent of the $4,200 per capita income of the developed nations. By 1975 the per capita income of the poorest nations had fallen to 2.7 per cent of the per capita income of the developed nations of $5,500. The gap is widening. The increase in income for the poorest nations in that period was 15 percent against the increase for the wealthiest nations of 3 1 per cent. This is another means of dramatically illustrating the way in which resources in the world are being redistributed and allocated to the benefit of the wealthiest countries. The poorest stay poor while the wealthiest get much wealthier.

Projections for 1985 show that the increase in incomes for the poorest countries will be about 20 per cent to approximately $180 per capita.

For the wealthiest developed nations the increase will be 47 per cent to $8,100. In other words, by 1985 the poorest countries will have a per capita income only 2.2 per cent of the per capita income of the developed countries. One can see that it is a losing race for the developing countries. The gulf is widening to their disadvantage in terms of the level of resources they are able to command from those additional resources being made available in the world each year. What it means is that at the most the annual increase in the per capita income for the poorest countries will be between $ 1 and $2. It all sums up to a most depressing picture.

There has been much talk, not a little posturing, a great deal of moralising and, frankly, very little achievement in terms of settling for the goals and solid results which have been set for the future and spoken about so much. The poorest countries are still bedevilled with the most depressing social and economic conditions. Compared with the developed countries the infant mortality rate is 8 times higher. The life expectancy rate is one-third less than for the developed countries. The adult literacy rate is 60 per cent less. The nutritional level for one person in two is below the acceptable standards of developed countries. Millions of infants have less protein than is required to allow the optimum development of the brain.

It is this sort of aid to poor countries which the Premier of Queensland, steeped in ignorance and indelibly dyed in bigotry rails against. He does it in the most poorly informed way. He is demanding that the sort of aid Australia provides for developing countries should be made available within the country. I am disappointed that the Minister for Foreign Affairs has firmly rebuked him, perhaps with some subtlety, but nonetheless he has firmly rejected the sorts of comments he is making which I suspect are gaining some public currency at least in Queensland. What the Premier of Queensland has to realise is the extent to which aid programs are funded from our overseas reserves. They have no impact on the domestic economy. Therefore, it is irrelevant for him to talk in the terms in which he has been talking. We are not denying people within this country resources which would otherwise be available.

To the extent that aid programs take the form of various goods fabricated in this country, to cut back on those programs would mean simply that people currently in employment producing them would become unemployed. If it is the Premier’s argument that the moneys should be spent domestically all it means is that there would be a transfer of resources from one industry in which people are employed fabricating various goods for aid programs to another industry. All he is doing is transferring unemployment within the community. He is making no contribution towards the common welfare of the community. In fact, at a time of slack economic activity like the present a most powerful argument can be mobilised in support of the fabrication of more goods in this country as part of an aid program. In that way apart from the humanitarian commitment in this support of aid more opportunity would be provided domestically.

It is incontestable that programs like those before us are helpful but they are limited in their help. I have already indicated that for all the years in which we have been talking about the breakthrough in our determination to lift the poor countries out of poverty, as members of the wealthy club of countries in the world we do not seem to have achieved much. In fact, it would seem on analysis of what has been achieved that what we have been doing has, in effect, been very much like ploughing the sea. As I mentioned, we have achieved a situation in which development assistance aid from the developed countries is still only 0.36 per cent of gross national products. The most advanced countries in the Western part of the world, the United States and Japan, have consistently deplorably poor records. One would have thought that out of enlightened self-interest they would have much to gain from a more generous commitment to aid. Those 2 countries have deplorably poor records of commitment in development aid programs. It is clear the more one analyses the available material that the rich countries are determined to stay that way.

I happen to think that the countries within the Organisation of Petroleum Exporting Countries which were responsible for the substantial increase in the price of oil were responding to a set of perfectly understandable circumstances. There was an opportunity for them to seek to redistribute in their favour some of the resources of the world from the wealthier countries. I know the argument that the less developed countries have suffered as a result of this action. I shall come back to that later. It is not as black and white as the critics of the action of the OPEC countries would like to make out. I am sceptical about the genuineness of the claims of the people who make this assertion. By and large they do not have a powerful record of assistance to poor non-oil-producing underdeveloped countries in the past. It seems more that they are using a convenient symbol to protest their concern at the treatment which has affected them as rich countries. In any case, the rich countries were to suffer some sort of redistribution of resources to the OPEC countries as a result of that action. It is clear that the rich countries have taken a number of measures which have over a relatively short time effectively reduced the real benefits of that redistributional exercise by the OPEC countries. I harbour the strong suspicion that one of the reasons America is prepared to bear with a substantial balance of payments deficit is to make some effort to inflate its way out of real cost of its oil bill.

The problem with the development of the underdeveloped countries as I see it is that providing aid of this sort is merely a little superficial dressing aimed to cover over some deeply seated problems in the world economic order. It means relatively little- the fact that relatively little has been achieved by programs so far is evidence of that- in terms of the nature and depth of the problem. I should be much more impressed if I could see determined action by the developed countries to accept more of the manufactured finished products of the developing countries. I find something repugnant about the symbiotic relationship that so many of the rich countries like to postulate as the proper relationship between themselves and poor countries whereby they accept the primary products and raw materials of the poor countries and the poor countries accept their finished products.

It is clear that the greatest advantages lie with those countries which are industrially advanced and continuing to develop, the countries with the technological knowhow and the industrial resources behind them. That is where the greatest proportion of value added in the economic order is derived. At the level of primary production and the production of raw materials the worth of value added in the production system is much lower. Until the developed countries are prepared to accept more of the finished manufactured products of developing countries, I am afraid we will continue to hold the poor countries as hostages to poverty. The current problems which this country is facing as a result of our trade relationship with the countries of the Association of South East Asian Nations- we sell twice as much to them as we buy from them- are evidence of the sort of prickly political problems that will confront us in the future. In the longer term we could easily find that because of the tough and uncouth attitudes expressed by Australian Government spokesmen we will become increasingly irrelevant to the needs of those near neighbours as they develop more industrially.

The problem with this Government is that, as one interprets its behaviour towards ASEAN countries, it is a disciple of the economic principle of unequal development- a euphemism for keeping all we have and trying to force a few sales on to those who are less well off. It is a remarkable principle of economic development for the needy that this country postulates quite firmly and quite inflexibly that aid by trade will go from the less developed to the developed- for instance, from the ASEAN countries to Australia. I do not underrate in any way at all the very great political problems in this country at the present time in attending to this issue, or the very difficult economic considerations which have to be weighed up; but that is no justification for the rather crude way in which our representative at the recent ASEAN discussions put down the representatives of those countries like an Australian Bjelke-Petersen with an imported nasally Oxford accent. He spoke well even if he thinks poorly.

There is not so much a need for a proliferation of gimmickry and new organisations; so I have some reservations about the development of a new one, the International Fund for Agricultural Development. As I read the Bill, it seems that what is proposed there can be well done by established agencies. In fact, the Fund will be calling on the services of established agencies. In other words, we need more, and more effective, aid through existing agencies. We need a freeing of the trade barriers which hold down the level of economic growth and the standard of living which can be provided in the developing countries. The wealthy countries collectively should commit themselves to providing grant assistance and much less assistance by way of loans. We have a good record in that respect at least. The developed countries should accept a moratorium on the debts of the underdeveloped countries incurred in previous loan commitments. We ought to play as influential role as we can, in the appropriate international agencies, to that end. We have to recognise that the paradigm of Western capital intensive development is not the best for the poorest countries. I acknowledge in this respect the important influence of the Minister for Foreign Affairs in Papua New Guinea in encouraging the Papuans and New Guineans and the Australian Government, which was the colonial administrator of the then Territory, to change the emphasis from an almost exclusive preoccupation with capital intensive development to one which tended to develop towards equal emphasis for labour intensive activity within the economy aimed at mobilising more traditional forms of economic activity.

The evidence from the developing countries, especially of Africa, is clearly that, whilst on paper one country can look extremely impressive in terms of the economic growth rate it is achieving and the per capita income that is achieved in this way, when an analysis is made, in some rigorous depth, of how that income is distributed the country is found to be quite poorly off. It is poorly off in the sense that some elites, some working class and middle class elites, are established, who are able to earmark for their own benefit the largest proportion of the benefits coming from that development, whilst on the other hand there is a very large dispossessed group of people who are coming from traditional village life into the cities and the large urban centres and are unable to obtain employment, and they become alienated and present all sorts of social problems and stresses for that sort of area.

As against that, one can look at another country. I confess freely that I have been enormously impressed with the achievements of Tanzania in this respect. On paper it has not had spectacular economic growth rates and certainly it does not have terribly impressive per capita levels of income, but in terms of mobilising all the people into the work force and providing an opportunity for them-providing a place under the sun, as it were, for all the people- it has been enormously successful. Perhaps it displays some rather disciplinarian, if not authoritarian, methods which are unacceptable to us, but I remember Mr Nyerere pointing out clearly to this country, at a luncheon in this building, that the principles for social and economic development in a country that is relatively poorly endowed with economic resources, as Tanzania is, are quite different from those of wealthy countries such as this one. Australia, for instance, can afford the massive blunder of an F 1 1 1 aircraft on the part of a government, involving some millions of dollars- in fact, hundreds of millions of dollars- and can absorb that sort of problem without significant economic disruption and dislocation. A poor country cannot afford that expensive margin of error.

The wealthy countries have to dedicate themselves to stable prices for commodities and, again, to a better revenue deal for the developing countries. The two things do not necessarily go together. The common fund is the sort of concept I have in mind, with all the problems it has- and it certainly bristles with problems-in terms of a stable price system for the commondities of the developing countries. I am highly suspicious of the newfound interest of the Americans. I am concerned that perhaps the Americans are considering that there are clear benefits for America in terms of stable prices for some of the mineral resources that she would wish to import. That is fair enough as long as the commitment does not stop there; as long as it goes further and is a genuinely altruistic commitment for the common good of mankind and is designed to establish a common fund program for other commodities. I repeat that I acknowledge freely the enormous problems with which this concept bristles, but the fact that a concept or a proposition bristles with problems is not sufficient justification for being caught flat-footed as the Australian Government was recently in international discussions on this subject, leaving the clear impression that we were not terribly interested in the concept at all.

I mentioned the need for a better revenue deal for the developing countries. Only 10 per cent of the total value added for their products, as they go through the various processes to end up as finished products in some sort of manufactured or processed form on world markets, goes to the poor countries. That happens because the marketing and the processing of these products is in the hands of the wealthy countries. Again I acknowledge the problems of overcoming this situation. I am not so much concerned about the conspiracy interpretation of the transnational!, as they now seem to be called, but rather the enormous problems of developing the technology, the marketing skills, the techniques, the outlets and so on which are necessary to overcome die sort of problem I have identified. The fact that there are such problems is not sufficient justification for not trying to do something. The developing countries ought to be encouraged to move in this direction through support from established international agencies. The fact that such a small proportion of total value added goes to the poor countries means that their opportunity for capital accumulation is extremely limited, and that in turn means that their opportunity for industrial development and economic growth is seriously constrained.

A further point that we have to consider is ways in which developing countries can be facilitated to reinvest the profits which are generated in their countries. It is a matter of the most notorious comment that some large, wealthy international organisations are responsible for intensive capital investment in certain development projects in some developing countries that provide limited employment opportunities but quite massive profit returns and that a very large proportion of those profits is drained out of the country to the benefit of the parent company or the international concern. There has to be a determined bid, as a matter of commonsense morality, to allow a substantial proportion of the profits generated in such countries to be reinvested by those countries in their own economic growth and development.

I shall have to condense some final points that I want to make on these matters because time is running out. Why I find a sense of urgency about these things is obvious. I mentioned a few minutes ago that, as much as wealthy countries like to vaunt what has been done in terms of aid in recent decades, the evidence is that the gap in terms of living standards between the wealthy advanced countries and the poor countries is in fact widening. I admit that the income per capita is improving in the poor countries, but it is improving most moderately and extremely unimpressively compared with the rate of increase in the living standards of the developed countries.

I noted quite recently a United Nations report that pointed out that the foreign direct investment in 43 developing countries in 1970 was $ 1 ,6 1 0m and that in the same year the outflow of income as repayment on accumulated past investment was $5,340m. Those are the sorts of disabilities under which the developing countries are staggering. The terms of trade move so often to punish the developing countries. In 1960, according to a report I read recently, a selection of developing countries indicated that they could import 6 tractors for the return from 25 tons of exported rubber. In 1965 they could import only 3w tractors for the return from 25 tons of exported rubber. So the terms of trade do tend to move against these countries. There are periods . when they move in their favour, but it seems that the long term trend certainly is not in their favour and certainly bears poor contrast with what happens to the developing countries.

Let us look at the sort of debt burden that is crippling them. In 1967 it was $50.7 billion for 86 developing countries. In 1975 it was $150 billion. The debt servicing in 1975 on that debt burden was $11.5 billion. The official development assistance aid from the developed countries was only $9.4 billion. So with an allowance for all the aid provided for them they were still more than $2 billion in deficit. That is an example of the ever expanding problem of financing their way in their striving to achieve a better standard of living, to achieve economic development and to try to close the gap between the developed countries and themselves. It is a striving that continues to fail and it will continue to fail while the wealthy countries of the world are so determined not only to hang on to what they have but also to redistribute as much as they can from the increase in the level of resources provided in the world each year to their own benefit.

I do not believe that our record in recent discussions has left the developing countries of the world with any sense of enthusiasm that they can any longer rely on Australia as a friendly, sympathetic and understanding nation where the aspirations of the developing countries are concerned. Our attitude to the common fund and the new international economic order was one of total unenlightenment. I sincerely trust that the Minister for Foreign Affairs, who in so many other ways displays a quite encouraging liberal enlightenment in these sorts of things and a great sense of moral and humanitarian responsibility, will assert himself in relation to this issue and demand that the proper role of Australia is one of sympathetic understanding, of support and of a constructive approach to the problems which I have acknowledged several times already are there in trying to develop a common fund and underwrite a new international economic order. But unless something like that is done and a complete recasting of our approach to development and the needs of developing countries is accepted, I am afraid that we are going to continue to languish in the situation where what we do is very much, as I have said, trying to dam a water flow with a fork. It is ineffective and quite inadequate for the task ahead.

Dr EDWARDS:
Berowra

-I say only that despite the tone of personal disappointment and disillusion in the approach of the Opposition spokesman on this subject, I gather that the Opposition supports the Bills.

Mr DEPUTY SPEAKER (Mr Giles:

-Order! Does the honourable member wish to seek the adjournment of this debate?

Dr EDWARDS:

– Yes, I am going to do that, but I want to say that these Bills should command the enthusiastic support of this House and all Australians.

Mr DEPUTY SPEAKER:

-Order! The honourable member should either seek the adjournment of the debate or make his speech. If the honourable member does not seek the adjournment of the debate it will mean that this Bill will retain its position on the Notice Paper and the Budget will not be able to be presented at 8 o’clock.

Dr EDWARDS:

– I move:

I seek leave to continue my remarks.

Leave granted; debate adjourned.

Sitting suspended from 6.1 to 8 p.m.

page 44

APPROPRIATION BILL (No. 1) 1977-78

Message from the Governor-General recommending appropriation for proposed expenditure announced.

Bill presented by Mr Lynch, and read a first time.

Second Reading (Budget Speech)

Mr LYNCH:
Treasurer · Flinders · LP

– I move:

In doing so, I present the Budget for1977-78.

At the outset tonight I re-affirm the Government’s basic objectives.

Our first goal is to maintain the underlying trend to lower inflation.

Our second goal, which is dependent upon the achievement of the first, is to promote moderate and non-inflationary growthin order to create jobs and reduce unemployment.

This Budget will move Australia further towards achieving those goals and, in so doing, it will build on the foundations laid by last year’s Budget.

Over the next twelve months the depths of Labor’s recession, and all of the community hardship that went with it, will be put further behind us.

This Budget is designed to give a lead to the community by addressing itself directly and realistically to our remaining problems.

One way in which it does so, in a decisive and unprecedented manner, is by lifting the yoke of taxation that has sapped the spirit and initiative of the community over recent years.

Unlike our predecessors we believe that taxes have taken too much from the community and that people now want greater charge of their own affairs.

The new tax system which I shall announce in this Budget has been made possible because of the efficiency and economy that we have brought to management of Government expenditures.

The way is now open to get Australia on the move.

This Budget charts a course towards lower taxation, towards conservation of the nation’s great energy resources and towards care for those most in need within the community.

It maintains the thrust towards economic stability without sacrificing any of the major social reforms of our first Budget such as thefamily allowance system.

Australia’s destiny is a shared responsibility, not something that lies in the hands of governments alone.

Responsibility also lies with business leaders: it is the private sector that employs most of our workers, makes most of the investment decisions and develops the technologies that can underpin increasing living standards.

Union leadership bears an equal responsibility: it is the trade union leaders who have to consider the unemployment consequences of their demands for higher pay for those presently in jobs.

All sections of the community must work together to harness our abundant natural and human resources, if we are to restore vigour and purpose to our national development.

This Budget sets the nation first; it recognises that there must be a fair sharing of the burdens and responsibilities, and a fair sharing of the rewards.

page 44

THE RECORD OF ACHIEVEMENT

I turn now to the record of achievement last year.

The Government’s first Budget was a key element in putting the overall economic strategy in place and, therefore, in the improved economic performance of1976-77.

We budgeted for outlays to grow in1976-77 at half the rate of1975-76, and for a Budget deficit nearly one billion dollars lower despite the costs of full personal tax indexation from 1 July 1976 and significant business tax incentives.

An increase of 10-12 per cent in the broadly defined volume of money,M3, was then foreseen as appropriate over1976-77.

A year later, the Government takes some satisfaction from the record.

Budget outlays, projected to rise by11.3 per cent, were held to only10.4 per cent, and for the second successive year outlays were contained within the original Budget estimate.

The deficit, originally put at$2,608m, emerged because of some shortfall in receipts as $2,740m, but nevertheless very much in line with the original estimate.

M3 increased by 10.6 per cent- well within the range projected.

The anti-inflationary role of external policy was, in the event, less than had been hoped.

The burden of Labor’s policy failures on the export and import-competing sectors made devaluation inevitable.

But, because of determined action by the Government, overall policy was not blown off course and the basic strategy was maintained.

Naturally, the economy is still adjusting to devaluation.

Indeed, understanding of that adjustment process is essential to any appraisal of where the economy now is and where it is heading.

The wages area also failed to contribute as much to recovery as it should have done.

This outcome, beyond the Government’s control, had serious consequences for the speed of recovery and the creation of new jobs.

The economy has still not fully attained the pre-conditions for sustained growth.

Solid progress has been made, but furthering it still hinges crucially on the prospects for inflation and income shares.

On that, I said last yean ‘Provided there is significantly less than full flow-on of price increases to wages, an improvement of several percentage points in price performance, and a possibly somewhat greater deceleration in money wages, can be had in 1 976-77 as a whole. ‘

Prices, and to some extent incomes, did largely develop in that way.

Excluding health and medical services- prices of which have been sharply influenced by changes in health insurance arrangements having nothing to do with inflation as such- the Consumer Price Index rose by 10.2 per cent over the course of 1976-77 compared with 15.4 per cent in 1975-76.

More broadly-based price indicators rose in 1976-77 by some 4 to 6 percentage points less than in 1975-76.

Productivity increased by 3.6 per cent in 1976-77; the profit share rose to 14.4 per cent from 13.5 per cent in 1975-76.

Company profits increased by 23.5 per cent.

Although the pattern within-year was not as foreseen, activity for the year as a whole was much as foreshadowed.

Real gross non-farm product rose for the year as a whole, with growth concentrated in the private sector.

Consumers spent more, and saved less, out of disposable incomes.

Business investment, although patchy, strengthened in total; plant and equipment spending, in particular, rose by 6 per cent in real terms.

Dwelling investment rose strongly for the year as a whole despite some slackness- now being taken up- in the later months.

Exports were also significantly higher for the year as a whole.

As presently recorded, economic growth was concentrated in the first half of the financial year.

Among the reasons for that pattern, which are fully discussed in Statement No. 2 attached, was the effect of devaluation- actual and anticipated -on the timing of expenditures.

The key point now is that the factors depressing demand and production early in 1977 were temporary ones.

The forward momentum of private activity is now beginning to re-assert itself.

Inflation over the year as a whole fell much as expected a year ago.

Wages costs also grew less fast in 1976-77 than in 1975-76, but the slow-down was less than had been hoped.

That is closely linked with the major disappointment of 1976-77- the continuation of high unemployment.

This is a matter of grave concern to the Government.

Unemployment is a human problem- it is not just a question of statistics.

It is precisely because of the social and family tragedies that go with unemployment that we have pressed, to the fullest extent, for wage and salary restraint in hearings of the Conciliation and Arbitration Commission.

The grave imbalance between real wages and productivity resulting from the 1974 wage explosion still remains Australia’s major economic problem.

That problem can only be solved by winding down real wages relative to productivity; while it persists, it makes all talk of quickly reducing unemployment merely hollow rhetoric.

Statement No. 2 presents some material on the extent of this imbalance.

In the most recent National Wage Case hearing the Commonwealth has presented related evidence.

The Commission must be prepared to face, with a greater degree of reality, the employment consequences of its decisions.

The basic point is this; if unemployment in Australia is to be tackled effectively, the real wage distortion in our economy will have to be corrected.

High labour costs have been deterring employers from taking on new workers.

All too often, the sums favour the alternativesreplacing men by machines or switching to foreign suppliers.

Partly for the former reason there was an appreciable lift in measured productivity in 1976-77.

A 3.5 per cent increase in product saw only a slight employment increase; and, with a growing labour force, unemployment therefore increased.

There can be no doubt that, had the wage determination processes permitted real wages to decline in 1976-77, recovery would have been stronger and unemployment less.

Instead, so far from having declined, as has been repeatedly asserted by our political opponents, real wages were actually higher at June 1977 than a year earlier.

Those fortunate enough still to have jobs had their real incomes improved, but at the cost of throwing others out of work.

Those trade union leaders and others clamouring for ‘full indexation’ might reflect on that result of their actions.

So might our arbitral tribunals.

page 46

THE BUDGET AND ECONOMIC STRATEGY FOR 1977-78

This Budget is dominated by two fundamentals.

First, despite the achievements to date, we still have some way to go in restoring the preconditions for lasting economic growth. 1977-78 must see a further advance.

Secondly, our policy strategy established last year and since maintained has been the right one.

That strategy must be held in place.

Our Budget decisions will give effect to the objective, stated last January, of further reducing the deficit.

This will permit an expansion in a broadly defined money supply to take place in 1977-78 at a rate a notch or so lower than in the previous year.

Our Budget decisions will also give effect to our other budgetary objective stated last January- to keep Budget outlays in 1977-78 to within zero real growth.

We have been mindful, however, of the shortterm dislocations that might have followed any appreciable reduction of real outlays at this time.

It is a measure of the painstaking preparation undertaken this year that we have been able to shape the Budget firmly within the parameters of our economic strategy, while accommodating the cost of both last year’s and this year’s major tax reductions.

Fiscal and monetary policies must be fully supported by the other arms of policy.

Wage restraint is crucial.

Externally, Australia’s now clearly strengthening trade account provides an encouraging basis for the current role of external policy.

There is a mutual dependence between the domestic and external arms of policy which should be explicitly noted.

In shaping its fiscal and monetary stance for 1977-78 the Government has had this well in mind. Fiscal and monetary laxness such as the benches opposite have urged upon us would undermine our international competitiveness

This Budget rejects that pitfall.

It will thereby contribute to a more positive outlook for the major development projects now under way and in the offing and their associated investment inflows.

In short, it will help to ensure that the favourable effects of last year’s devaluation, now increasingly appearing, will be preserved and not just frittered away.

Against that background let me say something about the role of the private sector in our economy.

It is now up to the private sector to respond to the brighter outlook which is in prospect.

As we have emphasized, a re-vitalized private sector is essential to increased productivity and more jobs

Governments can only do so much; this Government has consistently pursued the course of making way for expansion of the private sector.

It is now up to the private sector to play its part in furthering the progress we have made towards establishing, and building upon, the preconditions for economic recovery.

page 47

OUTLAYS

I turn now to outlays.

In 1977-7S total expenditures are estimated at $26,656m, an increase of 10.5 per cent or virtually the same increase as in 1976-77.

I mention some of the larger provisions in the Budget; details of these and other provisions are set out in Statement No. 3 and other accompanying Budget documents and in Ministerial statements.

page 47

SOCIAL SECURITY AND WELFARE

Outlays for social security and welfare purposes are estimated to total about $7,250m in 1977-78, an increase of about 13 per cent on last year.

These outlays now account for 27 cents in every $1 spent from the Budget, or 56 cents in every $ 1 raised in personal income tax.

Pensions

Social service pensions and benefits are adjusted six-monthly in line with movements in the Consumer Prime Index.

Accordingly, the standard or single rate of social service pensions and benefits will be increased by $2.20 to $49.30 a week from the first payday in November.

The combined married rate will rise by $3.70 to $82.20 per week.

There will be a further increase from the first payday in May 1978 in line with the movement in the Consumer Price Index in the second half of 1977.

These increases are estimated to cost $ 1 82m in 1977-78 and $490m in a full year.

Repatriation Benefits

Repatriation disability and service pensions also will be increased in November 1977 and May 1978 in line with increases in the Consumer Prime Index.

These increases are estimated to cost $25. 3m in 1977-78 and $6 1.5m in a full year.

The Government has decided to discontinue the Sustenance Allowance and replace it by a Loss of Earnings Allowance, and to modify existing arrangements concerning pensions related to pulmonary tuberculosis.

Assistance to Handicapped People

Special assistance for handicapped people in 1977-78 is estimated at $93m, an increase of 33 per cent on last year.

This is one of the fastest growing programs in the Budget; it demonstrates that, the need for expenditure restraint notwithstanding, this Government is concerned to assist the underprivileged members of our community.

At present an allowance of $15 a week is payable for a severely handicapped child.

We are extending eligibility for similar grants of up to $15 a week to parents or guardians on low incomes who are experiencing financial hardship in caring for a substantially handicapped child.

Aged Persons’ Accommodation

An amount of $50m is provided for expenditure on aged persons’ homes and hostels in 1977-78, $7.6m more than last year.

Children ‘s Services

This year we are providing $73m for children’s services, an increase of $6m on last year.

Unemployment Benefits

The estimates include $787m for unemployment and sickness benefit payments this year.

It is the Government’s aim to see that these funds go to the genuinely unemployed.

It has become evident that the present arrangement of paying two weeks’ unemployment benefit in advance is resulting in persons who have secured employment being paid unemployment benefits as well, producing a very substantial overpayment in aggregate.

After considering the recommendations in the Myers Report, the Government has decided that in future unemployment benefits will be paid fortnightly in arrears.

Review of Social Security Systems

As already announced, an overall review of the operations of the Department of Social Security is being carried out with a view to implementing improvements in the Department’s present systems and procedures.

The Department’s programs now involve expenditures of the order of $6 billion annually and significant savings are expected to result from the review in 1977-78.

Assistance to Aboriginals

Although Aboriginals have access to normal Commonwealth financed services and benefits the Government strongly supports special programs of assistance for Aboriginals.

In the Budget we are providing $110m for expenditure on non-administrative activities of the Department of Aboriginal Affairs.

Overall expenditure on programs of direct assistance to Aboriginals in 1977-78 is estimated to be about $176m, compared with $161m in

1976- 77.

page 48

EDUCATION

The Budget provides for Commonwealth expenditure of $2,37 lm on education in 1977- 78, $21 lm or 10 per cent more than last year.

Late last year substantial general increases were announced in student allowances and benefits; these increases were effective from the beginning of 1977.

Some living and boarding allowances will be further increased from the beginning of 1978.

page 48

HEALTH

At $2,8 14m, expenditure on health care in 1977-78 will again pre-empt a large slice of Budget outlays.

Payments of Medibank benefits in 1977-78 are estimated at $ 1 ,494m.

The estimate of $942m in payments to the States under the hospital cost-sharing agreements during 1977-78 reflects an expectation of firm cost containment in public hospitals.

Under the Community Health Program the Commonwealth is providing substantial financial assistance for some 700 community health projects.

In 1976-77 $7Om was provided under this Program; this year, based on the Commonwealth contributing SO per cent of capital costs and 75 per cent of recurrent costs, expenditure is estimated to exceed $79m.

The Commonwealth will be suggesting to the States that, within this increased allocation, a higher priority be given to the funding of women’s refuges.

As recently announced, new nursing home arrangements will take effect from 1 October.

Rates of benefit payable by the Commonwealth and the Hospital Funds will be set at higher rates in each State from that date.

The effect will be that the benefits, when combined with the statutory patient contribution, will cover fees payable in respect of 70 per cent of patients in non-government National Health

Act nursing homes compared with 30 per cent at present.

page 48

DEFENCE

The Government is determined to improve Australia ‘s defence capability.

Total outlays for defence activities in 1977-78 are estimated at $2, 343m, and imply an increase of about 1 per cent in real terms.

In a Budget in which total outlays are estimated to decrease slightly in real terms, this increase is evidence of the continuing high priority which this Government attaches to defence.

In particular, further progress is to be made towards achieving the important objectives for capital equipment and facilities outlined in the Defence White Paper presented to Parliament by the Minister for Defence last year.

page 48

OVERSEAS AID

Expenditure on Australia’s overseas aid programs is estimated to increase by 12 per cent, from $38Om in 1976-77 to $426m in 1977-78.

page 48

HOUSING AND COMMUNITY DEVELOPMENT

Welfare Housing

In 1977-78 $390m will be made available to the States for welfare housing, $15m more than last year.

I shall refer later to the associated question of finance for private housing.

Defence Service Homes

Some $22m will be provided for the Defence Service Homes Scheme; repayments of earlier loans and proceeds from property sales are estimated at $72.6m, making a total of about $94.6m available for the Scheme in 1977-78.

In 1977-78 an application fee of $75 for an initial Defence Service Home loan will be introduced; an application fee of $50 will be charged for an additional loan.

Housing Allowance Voucher Experiment

Last year, I announced our decision in principle to undertake a housing allowance voucher experiment.

Field activity to implement the experiment is expected to get under way at the first siteMelbourne late in 1977-78.

About $ 1 m is provided for this purpose.

Growth Centres and Decentralisation

The Budget provides $15m for decentralisation purposes, including growth centres, in 1977-78, comprising $5m for Albury-Wodonga, $3m for the Bathurst-Orange and Macarthur growth centres, and approximately $6m for a new program of support for general decentralisation initiatives.

page 49

TRANSPORT AND COMMUNICATION

Postal and Telecommunications Services

The Australian Telecommunications Commission’s capital program, although larger than in 1976-77, will be funded mainly from the Commission’s own internal resources and from local borrowings; drawings from the Budget are estimated at $65m in 1977-78 compared with $2 15m in 1976-77.

It is expected that the Commissions will be able to hold basic postage and telephone charges in 1977-78, for the second year running.

Nor is the Government proposing, as is sometimes suggested, to re-introduce broadcasting and TV receiver licences.

Some more minor licence fees are, however, to be increased: radiocommunications licences will be increased, for some classes of users, from $20 a year to $25 a year, effective from 1 October 1977, and the fees payable by some licensees of commercial radio and television stations are also to be increased.

Transport

As already announced, $475m will be provided to the States for road works in 1977-78.

Other large expenditures in the transport area include: $55m to meet expected operating losses of the Australian National Railways Commission; a further $33m towards financing the Commission’s capital program, including continued construction of the standard gauge railway between Tarcoola and Alice Springs; $5 lm in assistance to the States for urban public transport projects, including $5m for new projects- the first since 1974; $8m for land transport planning and research; and $23m for Tasmanian Freight Equalization.

Light dues levied on shipping to recover the cost of providing coastal navigation aids are to be increased from 35 cents per net registered ton per quarter to 41 cents from 1 October 1977.

The Government has decided not to increase the level of air navigation charges this year.

page 49

ASSISTANCE TO RURAL INDUSTRY

In recognition of the depressed outlook for the farm sector the Budget continues to provide for a wide range of rural industry support activities.

Details are set out in Statements attached to the Budget Speech.

Here I mention some of the larger provisions: $53m to facilitate rural industries’ adjustment to changing circumstances; $3 1 .4m for wool research and promotion; $ 15.1m for the continuation of the Brucellosis and Tuberculosis Eradication Campaign; $40m for continuation of the superphosphate subsidy; and $I2m for continuation of the nitrogenous fertilizer subsidy at its present level, the proposed review of that level from 1 January 1978 being postponed.

Rural Bank

We have now approved in principle the establishment of a national rural bank, preferably taking the form of a refinance institution.

We see the new bank complementing existing credit facilities and we intend to hold discussions in the near future with major lending institutions concerning appropriate structural and funding arrangements.

We shall press forward with these dicussions without delay.

page 49

SUPPORT FOR EXPORTS AND RESEARCH

Export Development Grants

The Government is concerned to assist all exporters, particularly through further reductions in the rate of inflation, thereby improving the international competitiveness of Australian goods and services.

As well, direct assistance of $30m- an increase of $5.9m- is included in the Budget for export market development grants to encourage firms to seek and develop overseas markets.

The whole question of financial incentives to exporters has been referred to the Industries Assistance Commission for examination; meanwhile the Government is not proceeding with the legislation foreshadowed in 1976 to reduce benefits and payments under the Scheme.

Industrial Research and Development Grants

The Budget provides $14m for payments of industrial research and development grants in 1977-78.

Coal Research

To finance increased coal research the Government will levy 5 cents a tonne on coal produced in Australia in the next three years; the levy will have effect from midnight tonight and is estimated to provide $3.4m this year.

page 50

TRAINING PROGRAMS

The Government acknowledges the seriousness of the present unemployment, especially among young people.

As well as the personal pressures on those unable to find work, there is also a tragic waste of the nation’s resources.

For these reasons the Government attaches special importance to its labour market training programs.

In addition to the general training assistance available the Government is making increased

E revision this year for programs aimed at enancing employment prospects for young people.

These include the recently introduced Community Youth Support Scheme, the Education Program for Unemployed Youth and the Special Youth Employment Training Program, all of which are now proving their worth.

The Government is broadening this assistance by extending the Special Youth Employment Training Program to young people under 25 years, to take effect immediately.

All told, the Budget provides $ 102.7m for employment training programs this year, an increase of 33 per cent over last year.

Even that very large increase will be surpassed if it is necessary to do so: we will not allow the budgetary situation to inhibit our training programs or our capacity to offer training to people who meet the necessary labour market criteria.

We intend also to approach the States to seek an early Commonwealth-State conference on the need to upgrade work skills in the community and to consider the adequacy and utilization of existing resources for training.

page 50

IMMIGRATION PROGRAM

The Government has decided not to set a specific immigration program for 1977-78 but to determine in-take on the basis of numbers of eligible applicants.

Assisted passages will be available for some 16 000 people, about the same number as in 1976-77.

page 50

CULTURE AND RECREATION

An amount of $137.3m is to be appropriated for the Australian Broadcasting Commission in 1977-78.

As already announced, the Government has decided to establish an independent authority to provide ethnic broadcasting services and, at a later date, possibly other specialized services.

The proposed appropriation for the provision of the ethnic broadcasting service in 1977-78 is $1.9m.

Spending on Australia Council programs is estimated at $24.4m in 1977-78, an increase of 10 per cent over spending on comparable programs last year.

Following a review of Commonwealth involvement in sport, we are providing $lm in 1977-78 for expenditure on national sports development and assistance; we are also establishing a Sports Advisory Council.

page 50

LEGAL AID

An amount of $ 19.6m is included in the Budget to maintain legal aid services in 1977-78 at their present levels; an additional $3.8m is being provided for Aboriginal Legal Aid Services.

page 50

PAYMENTS TO STATES AND LOCAL GOVERNMENT AUTHORITIES

Despite the need this year for overall budgetary restraint, the Commonwealth has maintained its policy of relative generosity to State and local governments.

In line with the offer made by the Prime Minister at the Premiers ‘ Conference in July, provision has been made for the States to receive $4336. lm under the tax sharing arrangements in respect of 1977-78.

I note that this is over $90m more than the estimate of what the States would have been entitled to under the tax sharing legislation.

The generosity of that increase should certainly enable the State governments to frame constructive Budgets which avoid putting up their indirect taxes and charges.

As part of this offer State tax sharing entitlements in future years are to be determined as a proportion of the preceding year’s personal income tax collections, excluding special surcharges or rebates.

The precise percentage to be applied in later years has still to be settled but with this change much firmer estimates of tax sharing entitlements for the year ahead will be known when Commonwealth and States’ Budgets are being prepared.

The Commonwealth’s offer represents a net increase of $621 m, or 16.8 per cent, in States’ tax sharing payments in 1977-78.

With Loan Council programs and the special grant to Queensland recommended by the Grants Commission, total general purpose payments to the States are estimated to increase by $685. lm, or 14.0 percent, in 1977-78.

Local government authorities’ share of personal income tax collections will be $165.3m in 1 977-78, 1 8. 1 per cent more than last year.

Total general purpose and specific purpose payments by the Commonwealth to States and local authorities this year will amount to about $10 billion net.

page 51

GENERAL GOVERNMENT EXPENDITURES

The Commonwealth is continuing to exercise firm restraint in general government expenditures.

Staff Ceilings

Since 30 June 1975 the number of public servants in employment areas covered by staff ceilings has fallen by about 12 500.

The staff ceilings now set for 30 June 1978 imply a further reduction of over 3000- or about 1 percent-during 1977-78.

Civil Works

A total of $375m is provided in the Budget for expenditure on new and existing civil works projects in 1977-78- leaving aside Darwin, where the rebuilding program is nearing completion, expenditure is estimated to increase by $ 14m.

The Darwin Reconstruction Commission is to be wound up on 3 1 December and the Department of Construction will take over responsibility for outstanding works.

The National Capital Development Commission will have a cash allocation of about $197m for civil works expenditures in Canberra this year, $6m less than last year.

Territories

With the move towards self-government in the Northern Territory, a global allocation of $50m has been included in the Budget for expenditure on those functions transferred on 1 January 1977 to the Northern Territory Legislative Assembly.

Provision is made in the Budget estimates for increased revenue from Northern Territory charges; the details are to be determined in consultation with the incoming Legislative Assembly.

Provision is also made in the estimates for increases in rates and charges in the Australian Capital Territory.

page 51

MAINTENANCE OF EXPENDITURE RESTRAINT

In each of the past two years we have succeeded in keeping actual outlays below the original Budget estimates.

We aim to repeat that performance again in 1977-78.

In so doing we shall again demonstrate that we meant what we said about restoring fiscal responsibility and restraining the previous runaway growth in government spending.

page 51

RECEIPTS

I come now to receipts.

Our revenue measures embody two principal considerations.

First, we see an over-riding need to reduce the burden of income tax so as to restore incentive for personal effort.

Secondly, we have focused upon the pressing need to conserve and develop our crude oil and other energy resources.

Again, as in 1976-77, there are no proposals in this Budget to increase duties on beer, or on spirits, or on cigarettes and tobacco.

Personal Income Tax

As I said at the outset, this Government is unremitting in its determination to rein back the growth in the public sector for a number of reasons, not the least of which is its fundamental belief that Australians should be able to determine to a greater extent how they spend thenincomes.

The more successful governments are in the exercise of economy in their expenditures, the more scope they have for reducing the burden of taxation on their citizens.

Our success since taking office in reducing the rate of growth in expenditure by the Government has made it possible for us to reduce the excessive level of personal taxation.

Our first step towards reform of the personal income tax system was to introduce last year full automatic indexation to prevent effective rates of personal income tax from increasing purely because of inflation.

We thus accomplished, in our first year of office, a reform that was initially set down for introduction over a three year period.

As a result of tax indexation the Government has forgone revenues in 1977-78 of about $965m on top of the $990m forgone last year.

But the inescapable fact is that, irrespective of the positive benefits of tax indexation, present rates of personal income tax are too high.

The present tax scale is not only inequitable, it is having devastating effects on incentive and on the will to work.

Given our conviction that decisive measures are required, we now intend to give effect to our own tax philosophy and, once and for all, to repudiate the high tax policies pursued by our political opponents.

Accordingly, we are introducing a much improved and simplified tax system that will provide very substantial benefits to taxpayers at all income levels.

The new measures represent the most revolutionary change yet made to Australia’s system of income tax.

The essence of the new system lies in the establishment of one tax rate as the basic rate of taxation for the vast majority of taxpayers.

The essential points of the new tax system are:

The so-called ‘general concessional rebate’which gave the misleading impression that taxpayers were receiving a benefit which did not in reality exist- will have no further relevance in the new system.

The tax threshold will be raised to $3,751 (from the rebate equivalent of $3,154) and no individual with an income below that level will pay tax.

Dependant rebates are, however, being retained, so that the effective tax threshold for a taxpayer with a dependent spouse will be $5,485.

A standard flat rate of tax of 32 per cent will be established on all taxable incomes over $3,750; this rate becomes the basic tax rate of the system.

A surcharge of 14 per cent will be imposed on that part of taxable income between $16,000 and $32,000.

A surcharge of 28 per cent will be imposed on that part of taxable income above $32,000.

Instead of the present seven-step scale this will establish a three-step scale incorporating effective marginal rates of 32, 46 and 60 per cent.

Let me briefly summarise some of the main benefits of this new and vastly simplified tax system.

The most important benefit is that there are tax reductions at all levels of taxable income.

Furthermore, the biggest proportional gainers are those on lower incomes at the bottom of the tax scale.

In fact, the incomes of about 225 000 taxpayers, including many pensioners with small private incomes, will be made non-taxable.

Some 90 per cent of taxpayers will pay tax at no more than the standard marginal rate of 32 percent.

As a result, the new system goes a long way to restoring the monetary incentive for individuals to work and to work harder, to take on added responsibility, to work overtime, and so on.

I now give some examples of how this system will affect selected income groups: a taxpayer on a taxable income of $4,000 per annum or $77 per week with no dependent spouse will have his tax liability reduced by $2.86 per week, nearly two-thirds of his present tax liability; a taxpayer on $ 10,000 per annum or $ 1 92 per week, about average earnings, will save $2.83 per week, and his marginal rate of tax will be reduced from 35c to 32c in the dollar; a taxpayer on $ 15,000 per annum or $288 per week will save $ 1 0.46 per week and his marginal rate will drop sharply from 45c to 32c in the dollar.

These reductions will be in addition to those already effected from 1 July last through the tax indexation mechanism.

The new system will apply from 1 February 1978 for both pay-as-you-earn and, notionally, for assessment purposes.

As from 1 February next, therefore, the total savings in tax from the new scale and the tax indexation mechanism combined will amount, in the three examples I have just quoted, to $4.46 per week, $5.38 per week and $15.38 per week, respectively.

These examples- which could of course be multiplied- indicate the substantial benefits flowing to all taxpayers from our program of tax reform and tax reduction to date.

I now briefly touch on some further aspects of the new system.

The general rebate of $676 previously allowable to all taxpayers regardless of their expenditures on concessional items would have meant in 1977-78, effectively, a rebate of 40 per cent for any such expenditures over $ 1,690.

With a 32 per cent standard rate being introduced, it has been decided that eligible expenditure above the ceiling will attract a rebate at that rate; the resultant revenue saving will be applied to reduce the ceiling from $1,690 to $1,590, thus making such rebates available to more taxpayers.

Several consequential amendments in respect of such matters as trust income and the threshold of the health insurance levy will be necessary; details are given in Statement No. 4 attached.

PA YE deductions from salaries and wages will be reduced as from 1 February 1978, based on the new scale.

The rate scale and other features applicable for the final assessment of tax liabilities on 1977-78 incomes will in practice be a composite, equivalent to seven-twelfths of the present system and five-twelfths of the new one.

Again, details are spelled out in Statement No. 4.

As basic provisional tax for 1977-78 is assessed on 1976-77 income, 1976-77 rates of tax will be applied in calculation thereof.

The substantial benefits of the new scales will add, from early 1978, to the benefits flowing from the latest round of indexation on 1 July 1977.

These new benefits will begin flowing to taxpayers five months before the next indexation adjustment.

Full automatic indexation to prevent effective rates of personal income tax from increasing purely because of inflation will be maintained in respect of the new system in future years.

However, transitional arrangements will apply with respect to the indexation adjustment due on 1 July 1978.

Dependant rebates which will have operated unchanged throughout the year, will be indexed at that time by the full factor given by the annual indexation rules.

The new rate scale, which will have been operating only during the second half of the financial year, will be indexed at that time by half the factor given by the annual indexation rules.

The cost of the measure on this basis is estimated at $406m in 1977-78 and $973m in 1978-79.

Incentives for the Arts

Continuing its active support for the arts and as a way of eliciting greater co-operation from the private sector, the Government will liberalise the conditions under which income tax deductions are allowable for gifts of works of art and comparable property to public art galleries, museums and libraries.

Details are contained in Statement No. 4.

The cost to revenue is estimated to approach $lm in 1977-78 and $2.5m in a full year.

Company Tax

As I mentioned earlier, there is a clear need this year to finance the essential personal tax reform I have just announced.

That has meant, for one thing, the most rigid control of the Commonwealth’s own expenditures.

Beyond that, however, we have also had to look elsewhere for increased sources of revenue.

Since coming to office the Government has eased the burden of tax on business income in several ways, notably by the investment allowance and the trading stock valuation adjustment.

These measures will produce a very substantial saving in the tax payable by corporate business in 1977-78, of the order of $600m at current tax rates.

As I said early on in my speech tonight there is a need for fair snaring of the burdens.

Against the background of the very substantial concessions given to companies last year, and of the recent and prospective increases in corporate profitability, it has been decided to increase the rates of company tax to apply in respect of 1976- 77 income.

The increase will be 31*4 per cent bringing the general rate to 46 per cent.

The same 3 1/2 per cent increase in rate will also apply to 1977-78 income of superannuation funds which do not observe the 30/20 rule, bringing their rate to 46 per cent.

This rate increase is estimated to yield $203m in 1977-78 and $224m in a full year.

Even so, company tax in total is estimated to increase by only $174m, or 6 per cent, in 1977- 78, compared with $302m, or 12 per cent, in 1976-77.

Small Business Taxation

The Government attaches particular importance to the fundamental role of small business in our free enterprise system.

Because of the benefits this year flowing from last year’s alterations to Division 7 tax, introduction of an investment allowance and a trading stock valuation adjustment, the effective rate of tax for the majority of small firms has been reduced by between 8 and 10 percentage points.

This year’s changes to personal income tax will be of particular benefit to the owneroperators of small companies and unincorporated enterprises, whose incomes are more subject to fluctuations than those of the majority of taxpayers.

There are of course many matters which affect small businesses but which are within the province of State governments- pay-roll tax, workers ‘ compensation and the like.

As I have said, the small business sector will be greatly assisted by the Budget- the Commonwealth hopes that State governments will have similar regard to the special needs of this sector.

Film Royalties Paid Abroad

Most film royalties paid from Australia are at present taxed, on an arbitrary basis, as if the foreign recipient’s profit rate were 10 per cent.

The Government considers that this produces an unreasonably low effective rate of tax.

Accordingly, the rate of tax to apply in respect of film royalties paid out of Australia after tonight will be 10 per cent of the gross royalties, which represents our standard tax treaty rate.

Gold-Mining Taxation

In April 1977 the Industries Assistance Commission submitted a report on the production of gold.

The Government has considered the report but has decided, because of continuing difficulties faced by the industry, to maintain the present basis of taxation and not to eliminate the concessions involved at this time. I pay particular credit to the local member of the area. That, of course, is the honourable member for Kalgoorlie (Mr Cotter).

Tax Avoidance

The Government is well aware of the activities in recent years of tax planners who, increasingly, are promoting tax avoidance schemes and arrangements throughout the business and professional community.

We propose to crack down hard on such practices.

Many of the arrangements that taxpayers are being induced to enter into are highly artificial and contrived, but they are causing substantial amounts of revenue to be either lost altogether or deferred for considerable periods of time.

The Government takes a serious view of these developments and proposes, in these Budget sittings, to bring forward amendments to combat these abuses of the provisions of the taxation laws.

Coal Export Duty

The Government will make a further reduction this year in the coal export levy.

The higher rate of duty will be reduced by $ 1.00 to $3.50 per tonne and the lower rate by 50 cents to $ 1.00 per tonne.

Should State governments seek to take advantage of this to increase their own royalties the Government will have to review its position.

I re-affirm the Government’s intention to remove the remaining duty next year in accordance with its previous undertaking.

Mr LYNCH:
LP

– We have news for you, my friend; I can tell you that.

The present reduction, which will apply immediately, will cost an estimated $24m in 1 977-78 and $27m in a full year.

page 54

CRUDE OIL POLICY

The world price of crude oil has risen dramatically in recent years but only very minor adjustments have been made to the price of crude from Australian wells.

Australian crude is now very substantially underpriced

Without significant new discoveries in the next few years, indigenous crude oil would fall from meeting about 70 per cent of total Australian demand to about 30 per cent by 1985.

We cannot afford a pricing policy that flies in the face of all energy conservation principles by condoning excessive consumption of our scarce presently known supplies of crude.

We are moving to produce appropriate energy pricing structure.

The National Energy Advisory Committee has the whole question of national energy policy under urgent study and is reporting progressively to the Government on it.

We also need a pricing policy that encourages new exploration and ensures full economic recovery of known deposits.

In partial recognition of these truths, the previous Government announced, and we nave maintained, a policy applying import parity prices to oil discovered after 14 September 1975.

But the previous Government did nothing to conserve the usage from existing fields, to increase the extent of recovery from them, or to develop new fields based on discoveries already made.

An estimated 400 million barrels of oil could be recovered in Australia at import parity prices that would not be recovered at existing prices.

This would add about 20 per cent, or about two years’ present requirements, to the reserves which would be economically recoverable at present prices.

Following a Government reference in May 1976, the Industries Assistance Commission has made recommendations directed to an orderly transition towards import parity prices for all local oil

The Government endorses this objective and has adopted an approach based essentially on the Commission’s recommendations.

An annually increasing proportion, or six million barrels per annum, whichever is the greater, of crude oil from each field or new development within fields discovered before 14 September 1975, will be sold at import parity prices, with the remainder sold at the present fixed prices for each field.

For the first year, commencing tonight, the proportion of oil per field to be sold at import parity prices will be 1 0 per cent of production.

In the three subsequent years, the corresponding proportions will be 20, 35 and 50 per cent.

Beyond this, it is the Government’s intention to move to full import parity as soon as possible thereafter; accordingly it will, prior to the end of the period, review the matter.

The Government believes that not all the additional profits resulting from these decisions should remain with the producers, and that the community should obtain a return from the exploitation of these resources which adequately reflects their value.

The fact that the recently increased value of crude oil stems essentially from action by a cartel of foreign oil producers makes the community interest in that enhanced value all the more obvious.

In view of this, the Government has decided to increase the production levy on crude oil from $2 to $3 per barrel.

The Government is, meanwhile, examining whether the levy should be replaced by a resources tax.

The levy will not apply to condensate marketed separately from a crude oil stream; such condensate may now be sold at commercially negotiated prices.

Nor will the levy apply to liquefied petroleum gas from fields not yet in production.

This will assist the marketing of LPG and condensate from fields already discovered but not yet developed in the North West Shelf and the Cooper Basin.

Condensate sold comingled in a crude oil stream will continue to be treated as crude oil for pricing and levy purposes.

The levy on liquefied petroleum gas from currently producing fields will remain at $2 per barrel.

Duty on Petroleum Products

In association with its review of energy pricing and conservation policies, the Government has also reviewed the duty on petroleum products and has decided to increase it by one-quarter cent per litre.

These decisions taken together will result in additional revenues totalling $180m this financial year, and $2 12m in a full year. The pricing and duty decisions combined are estimated to result in an ultimate increase in retail petrol prices of about Vh cents per litre, or about 1 1 cents per gallon, in 1 977-78; because of the lags involved, these final price effects are likely to come through rather gradually.

Petrol will remain appreciably cheaper in Australia than in most other comparable countries.

The Government regrets the need for any action that adds to consumer prices.

However, it also realises that the steadily diminishing proportion of our crude oil needs which will be supplied from domestic wells means that increased petrol prices are inevitable in any case; the sooner they are effected, die sooner will excessive use be curtailed, presently uneconomic fields be developed and exploration for new fields stepped up.

A further statement on the new oil pricing and levy arrangements will be made by the Minister for National Resources.

page 56

BUDGET OVERVIEW

Total outlays in 1977-78 are estimated to increase by 10.5 per cent to $26,656m.

Total receipts are estimated to increase by 14.3 per cent to $24,439m.

The overall deficit is therefore estimated at $2,217m, a reduction of $523m in 1976-77.

After allowance for overseas transactions, the domestic deficit is estimated at $ 1,347m in 1977-78, almost $650m less than in 1976-77.

page 56

THE ECONOMIC OUTLOOK

The outcome I have just announced is consistent with our fiscal stance since taking office.

In 1 977-78 fiscal policy will again reinforce the other arms of policy.

In particular, the further reduction in the Budget deficit will lighten the burden on monetary policy.

We are thus a step closer to our objectives of sustainably lowering interest rates and beginning to ease the restrictions on bank lending during the course of 1977-78.

As that can be responsibly achieved, there will be obvious benefits for the economy.

I can mention tonight one step in that direction.

The Government has been concerned, in reviewing the overall housing scene, to ensure that availability of finance is not a barrier to steady and sustainable growth in home building activity, including additions and renovations.

If borrowers are credit worthy, we would not want them to be denied housing finance because of official restraints.

Accordingly, the Government has advised the Reserve Bank that it wants to see banks and other financial institutions encouraged to increase their lending for private home building, particularly in those States and areas where the capacity of the building industry is underutilised.

It is of course being left to individual lenders to determine their levels of lending, taking into account their particular balance sheet positions and their assessments of the housing situation in their areas of operations.

Despite the many hazards in such projections, the present outlook indicates future growth in the broadly defined measure of the volume of money, M3, in the range of 8- 10 per cent over the course of 1977-78.

That range may change as circumstances unfold.

It may also be necessary, as in 1976-77, to adjust policy in response to changing circumstances.

With those qualifications, I indicate the Government’s present expectation that it will be appropriate for monetary growth in 1977-78 to be somewhat less than in 1976-77.

This would maintain the Government’s policy of providing adequate funds for sustainable recovery in private sector activity and employment, while continuing to bear down steadily on inflation and inflationary expectations.

The Government believes that these broad monetary expectations will provide the community with a continuing degree of certainty as to the outlook.

Overall, these fiscal and monetary policy settings provide ground for cautious optimism about the unfolding of economic conditions through 1977-78.

Again, however, I stress that restoring the Australian economy from its previously shattered state is no simple task.

The course of inflation during the first half of 1977-78 will be influenced by several transitory factors.

These will include the continuing lagged effects of last year ‘s devaluation, some ‘ catch-up ‘ effects from the recent prices ‘pause’ and the direct and indirect effects of the pricing-cum-duty decisions on petroleum products which I have just announced.

But, more importantly, the basic thrust of policy is such as to further reduce the underlying rate of inflation.

Fundamentally, of course, inflation- and unemployment- in 1977-78 will be heavily influenced by the extent of wage indexation applying.

If we assume, for example, that future National Wage Case decisions embody a broadly similar degree of partial indexation as in 1976-77, by mid- 1978 a wide range of price indicators would be registering quarterly rates of increase of the order of 2-2Vi per cent.

Unless the degree of wage indexation is reduced, it will mean wage rate increases of around 10 per cent for 1977-78 as a whole.

Such an outcome would contribute little to reducing real wage/productivity distortion.

If the Commission does make a contribution to this problem by lower awards, the outlook for jobs- and unemployment- will be strengthened.

We shall, of course, continue to urge the bench to do so- stressing in that regard the relevance of the tax relief we are providing.

As noted earlier, the underlying forward momentum of demand and activity has begun to reassert itself in recent months.

That process will gather pace over the course in 1977-78.

Product growth will induce some short-term gains in measured productivity and some further improvement in profitability and profit levels.

Growth of final domestic demand will again be concentrated in the private sector, with the cuts in personal income tax and some further decline in the personal saving ratio underpinning moderate growth in consumption while the business fixed investment growth already in train strengthens and broadens.

As the trade account continues to switch around, it will contribute significantly to the growth of domestic product over the course of the year.

It will also contribute to an improving balance of payments position, although the usual seasonal influences will work in the other direction for the next few months.

With policy bearing down on inflation and business investment picking up, strengthening private capital inflows and the recently announced resumption of long-term official borrowing overseas should reinforce the capital account also as the year progresses.

Gross non-farm product should increase by over 4 per cent between the June quarters of 1977 and 1978.

This compares with a corresponding increase of 1 per cent between the June quarter 1976 and the June quarter 1977.

Due to the within-year patterns- particularly the strong first half and weak second half of 1 976-77- growth of that order in non-farm product over the course of 1977-78 would entail growth for 1977-78 as a whole of about 2 per cent.

Although seasonal conditions are largely unpredictable, at this stage they seem unlikely to support more than a marginal increase in the volume of farm production; if so, real farm incomes would be likely to fall somewhat.

Such an overall picture for activity would be consistent with strengthening, though still modest, employment growth during the course of 1977-78.

This should broadly take up the growth in the work-force but perhaps not much more than that.

Such an outcome would reflect, of course, the continuing serious real wage distortion and the characteristics of the wage determination process.

Our policies will continue to erode that distortion and open the way to increased job opportunities and lower unemployment.

That desirable outcome would be attainable more quickly were there to be greater moderation on the part of those demanding wage increases and on the part of those awarding them.

page 57

CONCLUSION

This Budget has been carefully designed.

It will be maintaining maximum pressure on inflation in the first half of the financial year.

In the second half of the financial year, as the results of these policies bear their fruits, the Budget will add a stimulus to activity through the large increase in disposable incomes flowing from tax reductions associated with changes to the personal income tax system.

The Government therefore, looks to a further slowdown in inflation in the second half of 1977-78, accompanied by a continuing pick-up in activity.

In short, this Budget assures further solid progress towards the Government’s economic and social objectives.

The new reform of the personal income tax is of particular benefit, both economic and social.

Economically, the Budget builds upon the foundations of the past eighteen months. 1976-77 was not an easy year, and 1977-78- in the very nature of the problems we confront- will not see any dramatic breakthrough to rapid economic recovery.

But the Budget provides solid grounds for looking to further gains in reducing the underlying rate of inflation and inflationary expectations in the year ahead.

That will, in turn, be reflected in rising levels of activity and growing job opportunities extending through into 1 978-79 and beyond.

I commend the Budget to honourable members.

Debate (on motion by Mr E. G. Whitlam) adjourned.

page 59

STATEMENTS ATTACHED TO THE BUDGET SPEECH

page 60

STATEMENT No. 1 - SUMMARY OF THE 1977-78 BUDGET

Budget Aggregates

The key Budget aggregates for 1977-78 are shown in the following table, together with comparable data for 1976-77: {:#subdebate-63-1} #### Outlays The Budget provides for an increase of 10.5 per cent in total outlays in 1977-78; this is virtually the same as the increase recorded in 1976-77 (10.4 per cent) but well down on the increases in 1975-76 (22.5 per cent) and 1974-75 (45.9 per cent). The budgeted increase implies, for the second year running, a reduction in total outlays expressed in real terms. Expressed as a proportion of gross domestic product, outlays reached a peak of 30.9 per cent in 1975-76, compared with 29.7 per cent in 1974-75 and around 24-25 per cent in earlier years. In 1976-77, reflecting the substantial deceleration in the rate of growth of" outlays, this proportion declined to 29.6 per cent; the present estimates imply a further reduction in 1977-78. Outlays for 1976-77 and the estimates for 1977-78 are classified by broad economic type in the following table: Estimates of outlays in 1977-78, classified by function, are set out in detail in Statement No. 3. The summary table below shows Budget outlays in 1976-77 and estimated outlays in 1977-78 classified according to their main functions or purposes: The main features are: o The largest increase is in respect of the 'Not Allocated to Function' category which includes interest payments and the bulk allowance of $90 million for prospective increases in wages and salaries of public servants, as well as the tax sharing entitlements of the States and local authorities and certain other payments to the States. *> Social Security and Welfare payments are estimated to increase by $817 million, or 12.7 per cent, in 1977-78 and are estimated to constitute over 27 per cent of total Budget outlays. o The increase of $216 million - 13.4 per cent - shown for General Public Services includes $50 million to be made available to the Northern Territory Legislative Assembly for expenditure on functions transferred to the Assembly on 1 January 1977. « The reduction shown in outlays for Housing mainly reflects the rundown in expenditure by the Darwin Reconstruction Commission and the transfer of responsibility for the Northern Territory Housing Commission to the Northern Territory Legislative Assembly (for which provision is made in General Public Services). o The increase of $271 million (10.7 per cent) in outlays for Health in 1977-78 would have been $56 million (2.0 per cent) had it not been for the prepayment in June 1976 of about $216 million to the States for the Commonwealth's share of hospital operating costs in respect of the September quarter of 1976-77. o The reduction of $111 million (7.0 per cent) in outlays for Economic Services mainly reflects the proposed financing of the Australian Telecommunications Commission's capital program primarily from internal sources and off-Budget borrowings - advances from the Budget are estimated at $65 million in 1977-78 compared with $215 million in 1976-77. {:#subdebate-63-2} #### Receipts Total Budget receipts are estimated to increase by 14.3 per cent in 1977-78 to S24 439 million. This is after allowance for the net loss to revenue of taxation measures. Reflecting the substantial cost to revenue of taxation measures introduced in 1976 and 1977, the estimated increase in revenues in 1977-78 is considerably less than the 17.0 per cent recorded in 1976-77 and the 19.7 per cent in 1975-76. Details of the estimates for 1977-78, including the effects of measures on receipts, are in Statement No. 4. {:#subdebate-63-3} #### The Deficit The estimated *total* deficit in 1977-78 of $2217 million is $523 million less than the 1976-77 deficit of $2740 million. After allowance for the deficit incurred on overseas transactions - mainly in respect of defence and foreign aid expenditure - the estimated *domestic* deficit is $1347 million. This is $648 million less than the *domestic* deficit of $1995 million recorded in. 1976-77. {:#subdebate-63-4} #### Historical Data Historical data on Budget transactions are presented in Statements Nos 5 and 6. Statement No. 5 provides a detailed account of the Budget outcome for 1976-77 while Statement No. 6 presents Budget data for the period 1967-68 to 1977-78 in both functional and national accounts form. Table 2 of Statement No. 6 shows the proportions of total outlays represented by functional and major sub-functional categories in each year since 1967-68. An Appendix describes the basis of the functional classification of Budget outlays used throughout the Budget Statements. An account of the economic context of the 1977-78 Budget and of the post-Budget outlook for the economy is presented in Statement No. 2. {: .page-start } page 64 {:#debate-64} ### STATEMENT No. 2- THE BUDGET AND THE ECONOMY {: .page-start } page 65 {:#debate-65} ### STATEMENT No. 2 - THE BUDGET AND THE ECONOMY The central objectives of macro-economic policy during 1976-77 were to reduce inflation while achieving moderate and sustainable recovery in private sector spending. Continued restraint on government expenditures, control of the growth of the monetary aggregates and advocacy of moderation in wage determination all contributed to the anti-inflationary thrust of policy during the year. The necessity to devalue the Australian dollar in November 1976 implied, at the time, a* marked change in the overall settings of macro-economic policy and the need to effect compensating adjustments to domestic policies. Review of Economic Developments in 1976-77 {:#subdebate-65-0} #### Activity and Employment Although the growth in economic activity in aggregate was greater in 1976-77 as a whole than in either of the two previous financial years, unevenness between sectors and over time continued to be a feature of economic performance. A sizeable increase in expenditure and product was recorded in calendar 1976, but the tempo of activity slowed again in the first half of 1977. The key question posed by this continued variation in performance concerns the strength and durability of the economic recovery that has been under way. Later sections of this Statement examine movements in major economic aggregates from that point of view. The following paragraphs describe major developments in the economy over the last year or so. This commentary, including the accompanying charts, refers to semi-annual movements. All figures mentioned are seasonally adjusted and in constant price terms unless otherwise noted. Since the economy is an interrelated whole, using developments in real expenditures as the starting-point for discussion is, though conventional, to some extent arbitrary. It can be seen from Chart 1 that *total final expenditure* (panel g) rose in both halves of 1976 - strongly so in the second half - before declining in the first half of 1977. *Private final consumption expenditure* (panel a) increased in both halves of 1976 although, because of the decline in the March quarter, only slightly so in the first half of the year. The pace of consumer spending quickened in the second half of the year to a seasonally adjusted annual rate of more than 6 per cent. The bunching of expenditures in anticipation of and immediately subsequent to the devaluation of late November' appears to have been an important contributing factor; in effect, this resulted in the movement of some consumption out of the first half of 1977 into the second half of 1976. A further small part of the increase in recorded consumption was due to the reclassification of expenditures resulting from the changes to health insurance arrangements that took effect on 1 October; these have had the effect of raising the level of recorded private consumption expenditure since the December quarter. Following very rapid growth through 1975-76, *private dwelling investment* (panel b) levelled off from mid- 1976 resulting in a lesser, though still sizeable, increase in the second half of the calendar year. The rapid expansion in new dwelling construction was not fully matched by growth in sales of dwellings; excess stocks of dwellings began accumulating towards the end of 1976 and, largely as a result, construction activity declined in the first half of 1977. *Private gross business fixed capital expenditure* (panels c and d), which fell through 1975, has increased, albeit marginally, in each of the three half-years since then. Investment in *other building and construction* (panel c) continued to fall throughout 1976 and, although recovering slightly in the March quarter, fell again in the June quarter and was little changed on a half-yearly basis. Investment in *plant and equipment* (panel d) has fluctuated between quarters but in half-yearly terms has consistently recorded increases since the end of 1975. On average the *public sector* has accounted directly for only a small part of the growth in total final expenditures since 1975. A small decline in the first half of calendar 1976 was approximately matched by an increase in the second half; there was a further, slightly larger, increase in the first half of 1977. In 1976-77 as a whole, government expenditure at all levels (panel e) was 1.8 per cent higher than in the previous year; current expenditures were 5. 1 per cent higher while capital expenditures were 2.6 per cent lower. *Exports* (panel f) provided a strong supplement to domestic final expenditure through most of 1976. Growth in the December half-year was over 16 per cent at an annual rate. However, the volume of exports declined in the December quarter and continuation of that decline into the first quarter of 1977 saw the volume of exports fall at an annual rate of 10 per cent in the six months to June 1977, in the process making the largest absolute contribution to the decline in total final expenditure in that halfyear (see Chart 1). As panel h shows, between 1975 and 1976 the cyclical turnaround of stocks from decumulation to accumulation was substantial. But at the time this turnaround was contributing most heavily to the growth in gross national expenditure, *import* volumes (panel i) were also rising strongly, substantially offsetting the contribution of stock changes to product growth. Both stock accumulation and importing continued to increase in the second half of 1976, though less markedly. With the increases in imports and stock-building broadly commensurate in 1976, movements in the *expenditure-based* estimate of *gross domestic product* (panel j) (excluding the statistical discrepancy) and total final expenditure in each half-year were similar, with both showing stronger growth in the second half of 1976 than in the first. As panel j shows, movements in the *income-based* estimate of GDP (including the statistical discrepancy) were almost even between the two halves. In 1976 as a whole *gross domestic product* (income-based) increased by 4.2 per cent, *farm product* by 4.1 per cent, and *non-farm product* (panel k) by 4.2 per cent. In the most recent half-year the fall in exports translated a broadly flat domestic final demand picture into a decline in total final expenditure. This was accompanied by a larger increase in imports than in the preceding half-year, and with markedly *lesser* non-farm stock accumulation non-farm product declined overall. (Further information on stock changes in the most recent half-year is contained in Table 4.) On present estimates for 1976-77 as a whole, domestic product (income-based) increased by 3.4 per cent, farm product by 2.4 per cent and non-farm product by 3.5 per cent. (Non-farm product growth for 1975-76 has been revised upwards from 0.8 per cent to 2.0 per cent.) The 3.5 per cent estimate for non-farm product growth for 1976-77 which, of course, remains subject to revision, compares with the forecast of about 4 per cent given in Statement No. 2 at this time last year; the pattern of developments within the year was rather more different from that foreseen, for reasons which are mentioned later. Within the farm sector, the gross value of production of *wheat* is estimated to have declined sharply in 1976-77 reflecting a marginal fall in volume and a larger price fall. The value of *sugar cane* cut for crushing increased after the decline in 1975-76. The value of *livestock* slaughtered rose sharply again, but was still a little below its high 1973-74 level. The value of *wool* production also increased solidly for the second successive year. *Industrial production* grew moderately, though erratically, over the course of 1976 before falling back slightly in the first half of 1977. The tracking of *labour market* conditions has been complicated in recent times by problems in interpretation of the available data. These difficulties were discussed in some detail in the October 1976 and February 1977 issues of the Treasury *Round-up of Economic Statistics.* On the *employment* side one difficulty has arisen because of divergent trends shown by the quarterly population survey and by the estimates of employed wage and salary earners. As Table 1 indicates, the former has recorded a sizeable increase over the last eighteen months while the latter has shown little change (a slight rise in government employment offsetting a fall in private employment). The survey-based concept of employment is broader, including as it does employers, self-employed persons, unpaid helpers and agricultural employment in addition to wage and salary earners. The sampling variability inherent in the survey estimates and differences in the timing and methods of collection require that comparison of the two series, particularly over short periods, be made with due caution. Nonetheless, the increase in this estimate of employment over longer periods suggests that the former labour force categories have been expanding elements of the total employed population. It should be noted also that growth in the survey estimate has been stronger in part-time than in full-time employment and, more recently, also for females than males. Observations about the level of and changes in *unemployment* over short periods are complicated by difficulties with the seasonal adjustment process (as a consequence, seasonal adjustment of persons registered with the CES was discontinued from September 1976) and other special influences acting on the CES statistics. Indicators in Table 1 point to underlying labour market conditions stabilising in 1976 before easing further in the first half of 1 977 when labour force participation rates rose above earlier low levels and labour force growth outstripped the increase in employment. Unemployment rates among females and juniors have been above the average, even relatively more than usual in the latter case; relative wage movements have been a contributing factor. Despite the high overall incidence of unemployment, labour is reported in short supply in a number of skilled categories. *Prices and Incomes* Increases in *earnings* and *prices* are shown, by half-yearly periods, in Chart 2. Chart 3 displays movements in *wages* and *gross surplus* per unit of real non-farm product; Chart 4 illustrates related movements in the *shares* of *wages* and *company profits* (gross operating surplus) in non-farm product at factor cost. As with activity, price and income developments in the review period fall into two phases: 1976, when the trend of price inflation was distinctly downwards and factor income shares moved in favour of profits, and the first half of 1977 when the downward trend in inflation was interrupted and income shares remained at about their levels of the preceding half-year. With wage indexation continuing to link award wage movements fairly closely to the inherited rate of price inflation (extra-indexation increases have remained small throughout), increases in award wage rates (Chart 2, panel a) and ordinary time earnings (panel b) remained large in 1976-77. The increase in award wages and earnings for 1976 as a whole owed much to the February National Wage Case rise of 6.4 per cent; later in the year two partial indexation decisions and the slowing of price inflation contributed to lesser increases. More recently, the large award wage increase granted on the basis of the December quarter increase in the consumer price index boosted the rise in award wages and earnings in the June quarter (although the increases in the half-year were still slightly lower) . As panels a, b and c of Chart 2 show, there has been only a very gradual deceleration in *award wages* and *earnings* over the past two years. Although the pattern has been uneven between quarters average award wages and weekly earnings in the recent June quarter, when deflated by the private consumption and non-farm product deflators, were as high as or higher than in the same quarter ofthe two previous years. The *consumer price index* (excluding hospital and medical services) decelerated in both halves of 1976; the *implicit deflator for major GNE components* and *aggregate non-farm prices* moderated even more markedly in the second half. Table 2 details movements in these and other price indicators. With productivity growing strongly through the year (Chart 5), *unit wage costs* rose much less rapidly than wage rates and earnings in both halves of 1976. *Unit gross surplus* rose in both half-years; with product also expanding this meant that the level of *gross operating surplus of companies* increased by 23.5 per cent in the year as a whole. There was a sizeable rise in the profit share over the year from its previous very low level (Chart 4). In the first half of 1977, by contrast, measured productivity declined marginally and unit wage costs rose more sharply than earnings. Unit gross surplus increased but with product lower, the gross operating surplus of companies rose only slightly on the previous half-year. The profit share declined fairly sharply in the June quarter and for the half-year was little changed from the second half of 1976. The impact of the devaluation of the Australian dollar in November 1976 on the price indexes most sensitive to changes in prices of internationally traded goods was immediate and substantial (see *Foreign Trade* and *Manufacturing Industry* price movements in Table 2). Effects on the broader indexes measuring final prices have been much less noticeable; this reflects both the more muted impact to be expected at later stages of production in a subdued domestic market, and also lags in transmission to final prices. Further, the prices 'pause' discouraged some price increases during the period of its application from mid-April until late May. This latter influence was also undoubtedly a factor in the weaker profit share in the June quarter, already noted. The rate of increase in the CPI (excluding hospital and medical services) levelled out in the first half of 1977, while aggregate non-farm prices and the deflator for major components of GNE rose more than in the preceding half-year (in part reflecting the influence of changes in composition). In 1976-77 as a whole the increase in the broadly-based price indexes was four to six percentage points less than in 1975-76. Although the slowdown in the rate of increase of wage rates and earnings was much less marked, there were increases in both the profit share and, more markedly, the level of profits. In contrast to 1975-76, an increase in average *farm sector prices* (9 per cent, as measured by the implicit deflator for farm product) was sufficient, with volume growth, to produce an increase, of 18 per cent, in *farm income* following declines of 10 per cent in 1975-76 and 39 per cent in 1974-75. With the rate and extent of unwinding of the 1974 distortion of real wages and the wage share being a key element in the process of recovery in activity and employment, wages growth and the factors underlying it warrant close examination. The system of wage indexation introduced by the Conciliation and Arbitration Commission in April 1975 remained the dominant influence in the process of wage determination over the past year, and its effect on the speed of real wage adjustment is of great importance. In analysing these issues it is essential to distinguish between the effect on total earnings growth - of increases in awards granted in National Wage Cases and other elements in earnings, including other award increases and hours worked, which are more directly responsive to the influence of the market place. Table 3 provides estimates of the contribution of the various influences to wages and earnings growth over recent years. On the basis of past experience in this country and elsewhere, the sharp downturn in economic activity in 1974 could have been expected to produce an early slowing in earnings and some decline in the real wage. In fact, although overtime payments began to decline early in the downturn in response to the easing demand for labour, large increases in award wages granted outside the National Wage Case arena persisted past the downturn. In 1975 as a whole, there was a sharp slow-down in other award increases, in the face of a more prolonged easing in the labour market and (not unrelated to that) a high degree of compliance with the principles of indexation. This contributed, with a fall in overtime, to the equally sharp decline in earnings growth in the first half of 1975 (see Chart 2). As in 1975, a substantial degree of indexation applied on average in 1976 but award wages increased by much more than in the preceding year on account of National Wage Cases (Table 3, first column) . A further slight deceleration in earnings occurred despite this because the market continued to bear down on the more flexible elements in earnings formation - other awards, overawards and overtime working (see Table 3). The institutional element of wage fixation under the present system is not, of course, determined in a vacuum; by its very nature it is, however, several steps removed from the direct operation of market forces. As indicated above, in the adjustment necessitated by the massive wage increases of 1974, National Wage Case determined increases have moved in the *opposite* direction to other elements. There is, of course, a strong_possibility that this greater *institutional* contribution to awards and earnings has facilitated in some measure the lesser contribution from those other elements. The key question, however, is whether, in the prevailing circumstances, smaller national wage decisions would have been compensated fully by more rapid increases from other sources. On the evidence of Table 3, it appears likely that smaller National Wage Case increases in 1976 would have resulted in smaller earnings increases. *The -Recovery Process in 1976-77* *Sources of Growth in 1976* In this document a year ago it was noted that: 'The second half of 1973-76 saw the beginnings of what, assuming continued progress in dealing with inflation, should on this occasion be a sustainable upturn.' The upturn did, in fact, continue into 1976-77 and was the strongest and most sustained lift in demand and activity since the onset of recession in 1974. Its characteristics differed significantly from the ephemeral upturn in demand and activity in the first half of 1975. On that occasion, as Chart 1 and Table 4 show, a large part of the increase in final demand emanated from the public sector, having its origins in the very large increase in Commonwealth outlays in 1974-75. The exceptional increases in real household incomes in 1974 produced some growth in private consumption expenditure in 1975, but this weakened again later in the year as inflation continued at high levels. There was little support from any of the other elements of private domestic final demand. In contrast, the upturn in 1976 was concentrated in the private sector and fairly widely based. Table 4 shows percentage point contributions of major demand components to movements in gross domestic product, including the separate contributions of private and government domestic final demand. In both 1974 and 1975, to a lesser extent, the contribution of private domestic final demand to GDP growth was weak and during fiscal 1974-75 much less than that of the government sector (this being the more remarkable since the latter is about one-third the size of the former). As long as that situation continued there could have been no prospect of a durable economic recovery. Recovery could not be sustained by burgeoning public expenditures because the associated intensification of inflation and inflationary expectations was generating offsetting depressive effects on private expenditures and eroding the international competitiveness of domestic producers. (The elements of this nexus were discussed in this document last year under the heading *Factors in Continued Recession.)* Policy, in recognition of this, has been aimed at controlling inflation and fostering private sector revival. The rate of increase in Budget outlays decelerated sharply during 1975-76 before levelling out in 1976-77. The domestic deficit showed a broadly similar pattern, though it turned down a little later; approximate seasonally adjusted half-yearly figures are shown in Table 5. {: type="a" start="a"} 0. Implicit price deflator for all public final expenditure; increase on same period in previous year. 1. The usual seasonal pattern of receipts has been much affected by the introduction of the indexation adjustments to PAYE instalment deductions on 1 July 1976. Special allowance has been made for this in arriving at the seasonally adjusted figures for receipts and the domestic deficit in 1976-77. Similar allowance has been made throughout for changing patterns of company tax and personal income tax refunds. The strengthening of private expenditure in 1976 was thus of considerable significance for the durability of the upturn. As Table 4 shows, private final demand was a major element in the strengthening of GDP in both halves of 1976. Just as higher, and for a time accelerating, inflation and inflationary expectations exacerbated the weakening in private sector expenditures in 1974 and continued to contribute to subdued overall performance in 1975, the easing of inflationary pressures - both actual and expected - facilitated expansion of private spending in 1976. One important element in this, which parallels the experience of overseas countries as inflation rates were brought under an increasing measure of control, has been the continued unwinding of the household saving ratio which began tentatively in 1975. Table 6 shows the patterns of change in income, consumption and the saving ratio over the past three years. {: type="a" start="a"} 0. Deflated by CPI; note the effects of changes in health insurance arrangements in September quarter 1975 and December quarter 1976. 1. Deflated by implicit price *deflator for private* consumption. 2. Ratio of household saving to household disposable income. Real household disposable income was rising through 1976 but the saving ratio was declining and consumption advanced more quickly than incomes. In 1976 as a whole consumption was 2.6 per cent higher than in 1975; household disposable income was 0.7 per cent higher, while the saving ratio declined by 1.5 percentage points. Declining inflation and expanding business profitability during 1976 also shifted business confidence, actual and prospective rates of return on capital outlays, and flows of internal funds in the direction required for greater investment activity. As a result, a prospect began to emerge for the most sustained revival in business fixed investment for some years. As noted earlier, plant and equipment investment increased - in 1976, and although expenditure . on nonresidential building and construction fell further in 1976, the value of approvals and commencements began to rise from early in the year. Other factors were working to bolster plant and equipment investment in 1976. The investment allowance has been in force since 1 January 1976 and for the first half of that year double depreciation provisions also applied to a wide range of plant and equipment expenditures. Continued high unit labour costs were also encouraging investment of the labour-saving variety. Improvements in the investment climate to date fall well short of what is required to permit a full investment recovery. For instance, as Table 7 shows, the company profit share remains significantly below its longer term norm. A feature of the economic recovery in other countries, even in the United States, has been the persistent relative sluggishness of business fixed investment despite a return to normal levels of profitability. This has raised questions about the prospective rate of return which businessmen now regard as adequate to justify the perceived risks associated with long-term capital projects in an environment of uncertainty and continued high inflation. Such questions are no less relevant in the Australian context. Stock accumulation contributed significantly to GDP growth in 1976 - particularly so in the turnaround from decumulation to accumulation in the first half of the year (Table 4). The stocks/ sales ratio (Table 7) had fallen in 1975 to an uncharacteristically low level for the recession phase of the cycle; severe stock shedding took place in the face of shrunken corporate cash flows and high costs of holding stocks. An easing of some of those factors and the improved outlook for sales allowed normal cyclical accumulation in 1976. The stocks/sales ratio declined a little further in early 1976 as a result of expanding sales, but this was reversed in the second half of the year. Although higher importing fairly fully matched stock building throughout 1976, there was sustained growth in export volumes until the final quarter of the year. In summary, 1976 saw the beginnings of what promised to be a sustainable recovery in economic activity, based on growth in private sector expenditures occurring in an environment of declining inflation and restorative changes to the basic economic distortions that have been dampening consumer and business spending in recent years. However, the rates of increase in most of the expenditure and product aggregates in 1976 were not as strong as in previous recoveries and the 1976 expansion was more uneven, both across sectors and over time. Opinions differed, therefore, about the durability of recovery. A lift in activity of this magnitude would usually have been enough to raise employment sufficiently to reduce unemployment notwithstanding a continuing growth in the workforce. In fact, as noted earlier in this Statement under *Activity and Employment,* and illustrated in Chart 5, total non-farm employment grew only slightly over 1976;' *wage and salary earner* employment in the private sector actually declined and no impression was made on unemployment. Even after allowance for the usual productivity growth in the early recovery stage of the business cycle (Chart 5) the employment response, particularly for wage and salary earners (Table 8), was weak. Analysis of this topic is clearly of great importance. Table 4 (and Chart 1) showed the significant contribution of exports to domestic product growth in 1976. The relatively low labour intensiveness of many exporting industries would, of course, have enabled expansion of output to occur in those areas with relatively little employment growth. Discussion of the employment response to recovery in 1976 would be totally inadequate, however, if it failed to take up the implications of the persistence of the imbalance between real wage levels and productivity. Table 8 brings together some key aspects of the problem. Columns 1 and 2 of the table compare the product real wage with productivity, both measured on a per manhour basis. The product real wage, which was out of line with productivity at the beginning of 1976, remained so through the year, despite the sizeable increase in productivity that served to slow the increase in unit labour costs and prices. The associated trend in wage and salary earner employment is shown clearly in the table. While cyclical productivity growth during 1976 ameliorated the real wage/ productivity imbalance for a time, the implications of the remaining imbalance for future employment growth should also be viewed in the context of the relationship between the product real wage and *trend* productivity. Moreover, the measure of the product real wage shown in Table 8 can be further refined to render its comparison with productivity more accurately illustrative of the remaining wage cost drag on improvements in labour market conditions. The national accounts concept of average earnings, while it does take in more than purely wage costs and, in contrast to the male-units earnings series, does reflect the effect of the transition to equal pay for females, does not encompass payroll tax - a significant non-wage labour cost. Chart 6, which again uses March quarter 1973 as the base period, compares average real male and female awards, and average wages, salaries and supplements (national accounts basis) augmented by payroll tax per man-hour, with actual productivity per man-hour and trend productivity (calculated by the Australian Bureau of Statistics on the basis of estimated movements in productivity and employment from 1964-65 to *1975-76).* The remaining real wage/productivity distortion, relative to both actual and trend productivity, is clearly large. As discussed in the Report of the Working Party on the Measurement of Labour Productivity, market sector productivity is the appropriate basis to consider in wage determination processes. Data on that basis, available only annually to 1975-76, were presented in the Commonwealth Submission to the August 1977 National Wage Case. In this document movements in the real product wage and other unit wage series are compared with productivity movements for the non-farm sector up to the June quarter 1977. The general picture of relativities between real labour costs and productivity for the non-farm sector has been broadly similar to that for the market sector. *1977- The First Half* In the most recent half-year a number of factors temporarily interrupted the moderate expansion in total final demand; the non-domestic production sources of supply (non-farm stocks and imports) contributed negatively and non-farm product declined slightly. With farm product (and stocks) recording increases the decline in total domestic product was less. Unemployment drifted upwards. Private domestic final demand was a little lower in the second half of 1976-77 than in the first half (Chart 1 and Table 4) . One contributing factor was the slackening in thefirst half of1977 in the previously very strong growthof private investment in dwellings discussed above (Chart 1, panel b). More generally, significant re-scheduling of expenditures from the second to the first half of the financial year accompanied devaluation: the December quarter of 1976 saw some consumption expenditure and investment in plant and equipment brought forward because of expectations of import price increases prior to and immediately after devaluation. Thus *some* of 1977's (first half) weakness in expenditure was 1976's (second half) strength; taking 1976-77 as a whole, private domestic final demand increased by 3.0 per cent. Table 4 displays the substantial negative contribution to product growth stemming from net foreign trade in the most recent half-year, with both a decline in exports and a strong increase in imports contributing to this result. The weakness in the balance of trade in the half-year reflected a number of factors (see the *Balance of Payments* section of this Statement). In particular, the increase in the volume of imports was stronger than the general level of domestic expenditure would have indicated. Some of that strength appears to reflect the lagged effect of forward ordering of imports in anticipation of devaluation. The varying prominence of non-farm inventories in the cyclical process has also contributed to the unevenness of total non-farm output. Following a strong positive contribution to product growth at the turnaround, non-farm stock accumulation abated and was contributing negatively to product growth in the first half of 1977. Moreover, in contrast to 1976, when non-farm stock movements and imports were *offsetting,* they were working *in tandem* to depress domestic production in the first half of1977. Other economies have experienced a similar pattern of strong contribution to product growth from stock movements in the early part of recovery, giving way to a dampening influence later as the rate of accumulation eased off. This varying cyclical behaviour of stocks was, for example, one of the main elements in the so-called 'pause' in the U.S. recovery late in 1976. The foregoing discussion embraces the readily identifiable reasons for the easing in economic activity between the first and second halves of 1976-77. Signs that they were largely transitory, rather than indicative of a petering out of recovery, began to emerge late in 1976-77. Although occurring too late to have much effect on the halfyearly movements in the relevant national accounts aggregates, retail sales and motor vehicle registrations strengthened over the course of the June quarter. Likewise, some renewed growth in export volumes and the beginnings of a more pronounced decline in import volumes presaged a more substantial turnaround on trade account. After falling in the March quarter, non-farm product increased by¾ per cent in the June quarter. {:#subdebate-65-1} #### Balance of Payments In1976-77 there was an overall *balance of payments deficit* of $481 million, following a deficit of$1 020 million in 1975-76. An increased *current account deficit,* attributable to both a reduced *trade surplus* and increased *net invisible payments,* was more than offset by a much larger *net apparent capital inflow* than in 1975-76. At the end of 1976-77, international reserves stood at S3. 3 billion, slightly higher than the level a year earlier. For analytical purposes, external account developments during 1976-77 should be divided into two periods - the five months prior to devaluation of the Australian dollar at the end of November1976, and the period thereafter. Table 9 below presents balance of payments aggregates for 1975-76 and 1976-77 (on a seasonally unadjusted basis). *The Pre-devaluation Period* At the beginning of 1976-77 there was apprehension about the eventual impact on the balance of payments of the high, though moderating, domestic inflation rate. However, notwithstanding the continued growth in costs and prices in Australia at a faster rate than overseas, the average monthly *trade* surplus in the first five months of 1976-77 was larger than in either of the two preceding half-years. Towards the end of the period there were some signs of a weakening in the trade account. After showing (unsustainably) strong growth in the September quarter, exports fell in subsequent months; at the same time growth in imports quickened and, in retrospect, there appears to have been some advance ordering of (and paying, or covering forward against paying, for) imports in expectation of a change in the exchange rate. Notwithstanding continuing growth in net invisible payments abroad, the deficit on *current account* remained relatively moderate in the pre-devaluation period. The immediate external problem, therefore, was in the *capital account.* Despite significant overseas borrowing on official account, including a S309 million drawing under the IMF's Compensatory Financing Facility, reserves fell by almost S500 million in the period between end-June and 26 November 1976. There was a net apparent private capital outflow in the first five months of 1976-77 of over $600 million, powerfully influenced by exchange rate expectations; a substantial part of this outflow was attributable to speculative leading of import payments and lagging of export receipts. As a result, by 26 November official reserve assets were about one-third lower than a year earlier. Against the background of this continuing loss of reserves, and the continued deterioration in Australia's underlying external competitive position, it was decided, with effect from 29 November 1976, to devalue the Australian dollar by 17.5 per cent and to institute a more flexibly administered exchange rate system. The immediate objective was to reverse the earlier speculative outflow of capital and to ease the sectional burden being shouldered by certain areas of the mining, rural and manufacturing industries in the effort to overcome inflation. At the same time, in recognition of the effect of devaluation on the overall setting of macro-economic policy, fiscal and monetary policies were tightened and the Government argued consistently that direct price effects of devaluation should not flow through into wages via indexation. Capital flows were being monitored closely and, as discussed below, inflow controls were soon extended. The objective was to preserve the gains from devaluation by minimising its potential second-round flow-on into the domestic cost and price structure. *The Post-devaluation Period* Devaluation had an immediate effect on capital transactions: the private capital outflows of the preceding months were quickly replaced by a very high rate of capital inflow. In December/January net apparent private capital inflow totalled about $900 million, reflecting a resurgence of new overseas borrowing and the start of the process of unwinding of pre-devaluation leads and lags in trade payments. Although the rate of private capital inflow diminished after the initial devaluation was reduced to 12.45 per cent in a series of eight steps, for the two-month period as a whole there was a balance of payments surplus of over $650 million. In view of these developments, and the large inflows in prospect, as evidenced by applications for exchange control approval to borrow overseas, early action was taken, with effect from 17 January, to strengthen controls on overseas borrowing. The embargo on short-term overseas borrowings was extended to all borrowings repayable in less than two years, and a variable deposit requirement of 25 per cent was imposed on borrowings for two years or more for specific non-exempt purposes. This latter measure brought the effective interest cost of such funds more into line with that of domestic borrowing. These extended controls, and dissipation of the unwinding of pre-devaluation leads and lags, resulted in a moderation in the rate of private capital inflow. In the last five months of the year, private capital inflow was much the same in total as in the *two* preceding months. However, after allowance for small net capital payments overseas on official account and a small net inflow as a result of marketing authorities' capital transactions, total net apparent capital inflow was a little over $1650 million in the post-devaluation period. The impact of devaluation - in particular its time profile - on the *current account* was more complex. As expected, the initial effects of the exchange rate change on export and import prices in Australian dollar terms showed up quite rapidly. Most export prices (in Australian dollars) responded quickly to devaluation (see Table 2); most of our exporters are price takers in world markets or sell under contracts denominated in foreign currencies. These initial gains appear largely to have been held. Similarly, import prices (in Australian dollars) rose substantially in the period immediately following devaluation (see Table 2). The response of export and import volumes to such price changes is lagged. The lags involved are variable according to the particular circumstances of the time, and can be masked in actual figures by the operation of other factors. The postdevaluation period provides an interesting example. On the exports side, the immediate effect of devaluation on Australian dollar prices was partially offset by a period of subdued overseas demand for some main export commodities (e.g. wool, sugar and a number of minerals and metals) and by the effect of industrial disputes. The volume of exports in the second half of 1976-77 was therefore lower than in the first half. Even in the context of devaluation that is not surprising; while in some cases demand increases can be met by reducing existing stocks at near post-devaluation prices, in general the effect of devaluation on export volumes is very slow to emerge - especially for rural commodities with annual production cycles. The continued subdued overseas demand for some major Australian exports also served to delay the volume response. The total value of imports increased sharply following devaluation. Apart from the price increases noted above, there was a strong rise in the volume of imports in the March quarter. In the closing months of1976-77 the volume of imports began to decline; in the June quarter imports of goods and services (seasonally adjusted at constant prices) fell by 5 per cent but remained above pre-devaluation levels. There appear to have been two main explanations for the delay in the emergence of the volume effects of devaluation (i.e. a shift away *from* imports to cheaper domestic substitutes). First, because of relatively slack domestic demand conditions, which led to some unintended stock accumulation, the price effects of devaluation, as reflected in import prices, were slow to be passed on to final buyers; that would be consistent with the sharp drop in the profit share in the June quarter (Table 7). The six-week price pause' in the June quarter of 1977 may also have been relevant. Secondly, it appears that substantial orders for *imports may have* been placed late in1976 in anticipation of devaluation, with the arrival being concentrated in the first half of 1977. The net outcome of these developments was a substantial reduction in the trade surplus in the post-devaluation period. With the net deficit on invisible transactions also adversely affected by devaluation in the short term, and with adverse seasonal factors operating in the period involved, the current account deficit increased appreciably. However, the resumption of private capital inflow more than offset the increase in the current account deficit. As a result there was an overall balance of payments surplus of$199 million in the last seven months of 1976-77. {:#subdebate-65-2} #### Monetary Conditions Table10 and Chart 7 set out the main factors producing changes in private sector liquidity and the volume of money over 1976-77 and the preceding two financial years. Table11 provides quarterly data on the asset composition of movements in the portfolios of government securities of major financial sectors over 1976-77 and the preceding two financial years. Strong injections from domestic budgetary transactions continued to be the dominant influence on private sector liquidity, with the domestic Budget deficit estimated to have run at seasonally adjusted annual rates of around$2100 million in the first half of 1976-77 and $1900 million in the second half. Despite the drop between the two half-years, these seasonally adjusted figures mask an even stronger than usual within-year swing in domestic budgetary transactions, stemming largely from the concentration of company tax collections in the last four months of the financial year (see Chart 8). With the known prospect of an unusually large end-year seasonal liquidity contraction, adequate preparation within the private sector by way of stocking portfolios with short-term Government securities during the liquidity upswing was an important aim of monetary management early in the year. To facilitate that process, Treasury Note yields were raised. Following the seasonally tight June quarter of 1976, private sector liquidity increased markedly in the September quarter, with the effects of the domestic Budget deficit of $2106 million only partly countered by unwinding of the Reserve Bank's commercial bill portfolio and a drain from private sector foreign exchange transactions. Substantial subscriptions to the July 1976 Commonwealth loan by the non-bank private sector were largely offset by sales of already issued securities to the authorities so that net nonbank take-up of Government debt amounted to only a moderate$156 million in the quarter. Ease in financial conditions at this time was evidenced by strong growth in the monetary aggregates and in the balance sheets of major financial institutions. Subsequent financing of speculation against the exchange rate was facilitated and adverse expectations about the rate were reinforced by perception of the inflationary implications of domestic monetary ease. This meant that measures of domestic credit showed more rapid expansion than did the usual monetary indicators. Notwithstanding the end of the seasonal run-down in the preceding June quarter, private short-term interest rates declined only a little in the early months of 1976-77. Expectations of early official interest rate reductions, which had been gathering some strength earlier in the year, were not maintained and sales of Government paper continued sluggish in October. Against this background, and in pursuance of the Government's monetary objectives - that monetary growth should provide sufficient funds to foster sustainable recovery in private sector activity and employment, while exerting some downward pressure on inflation - monetary policy instruments were tightened in early November. With primary liquidity growing strongly, restraint in secondary credit creation was required for financial conditions to be less than fully accommodating to inflation. These measures included further increases in yields on very short-term Government securities leading through to higher yields on short and medium Government paper, a percentage point rise in the SRD ratio and guidance to restrain lending by financial intermediaries. Nonetheless, speculation against the currency - strongly in evidence in September and October - continued, leading to the devaluation in late November. To offset the expansionary monetary impact of the expected post-devaluation unwinding of leads and lags in trade payments and the turnaround in other private capital flows, further increases in official yields at the time of the devaluation were followed by increased restrictions on overseas borrowings in January and the series of small revaluations over the December-February period. The SRD ratio was increased from 6 per cent to 10 per cent in steps of one percentage point, the last increase being in February. Added emphasis was given to slowing the pace of lending by various intermediaries. The rapid strengthening of demand for Treasury Notes in the December quarter - particularly in the latter part - is reflected in Table 1 1 . In the March quarter, primary liquidity rose by SI 031 million; an aggregate Budget deficit of SI 171 million in January and February more than offset a surplus of S518 million in March. Private sector foreign exchange transactions, having turned to surplus, added strongly to liquidity. Non-bank accumulation of Government paper early in the quarter was largely unwound in March as the seasonal tax harvest got under way; over the quarter as a whole, Treasury Notes in, the hands of non-bank holders fell by $366 million while their stocks of other securities (which include Treasury Bonds and Australian Savings Bonds) increased by S468 million. A substantial run-off in banks' commercial bill holdings and diminished demand for other accommodation following devaluation meant that trading bank advances outstanding declined by S373 million in seasonally adjusted terms in January and February but resumed their growth in March. At the time of the seasonal liquidity peak at around end-February, private sector holdings of very short-dated assets seemed adequate, in aggregate, to negotiate the prospective large liquidity contraction associated with the very substantial tax harvest. The capacity of the banking system to finance this seasonal funds transfer was augmented by reversion of the LGS ratio from 23 per cent to 18 per cent from 1 April. In early April, major trading banks' margins of free liquidity averaged a little over 10 percentage points but with considerable dispersion between banks. In the event, financial markets met the withdrawal of funds without exceptional strain. Aggregate funds flows to the Government on Budget account during the period turned' out to be fairly well in line with expectations; none the less, some tight periods in markets were occasioned by difficulties in matching the maturity structure of assets with an imperfectly known pattern of funds flows. Sensitive private short-term interest rates increased seasonally. Reflecting some revision to interest rate expectations and a level of rates more in accord with the market's more optimistic perception of current and future rates of inflation following the publication of the consumer price index for the March quarter, the non-bank private sector subscribed heavily to the Commonwealth May loan and subsequently made substantial net purchases of Government paper through the market (see Table 11). This, together with some reversion to deficit in private sector foreign exchange transactions in May-June, sharply reduced the liquidity of major trading banks at the tail-end of the drain. To maintain the banks' liquidity positions, the SRD ratio was reduced by two percentage points around year-end. In last year's Budget Speech the Treasurer foreshadowed that growth in the broadly defined volume of money, M3, in the 10-12 per cent range during 1976-77 would be consistent with the aims of Government policy. The 10.6 per cent increase recorded in M3 for the year, compared with 13.8 per cent in 1975-76, signifies considerable success in the operation of monetary policy during a year which was not without its difficulties and in which circumstances changed markedly as it unfolded. A substantial within-year firming of monetary conditions is indicated in the reduction in the seasonally adjusted annual rate of growth of M3 from 15 per cent in the half-year to December 1976 to 6 per cent in the half-year to June 1977 - though problems of seasonal adjustment exaggerate the apparent turnaround. This pattern partly reflects the fact that, following devaluation, demands were made on the monetary instruments additional to those already required by fiscal settings in order to maintain the overall anti-inflationary stance of policy. In early July the controls on overseas borrowings reverted to their settings prior to mid-January. An important element of the monetary outcome was the contribution that $1089 million in sales of Commonwealth Government securities to the non-bank private sector, made towards financing the large domestic Budget deficit. Australian Savings Bonds continued to prove a useful addition to the set of monetary instruments, netting (after allowance for redemptions of Special Bonds and Savings Bonds) $366 million in subscriptions, almost all by the non-bank sector. Although holdings rose substantially over the liquidity upswing, aggregate Treasury Note portfolios of non-bank groups declined marginally over the year as a whole. The bulk of the growth in holdings of other securities (mainly Treasury Bonds) was concentrated in the seasonally tight halfyear. (Table 11 contains details of Government financing transactions.) As in 1975-76, when a net $1122 million (or 77 per cent of total non-bank take-up) was received from Australian Savings Bonds, non-bank take-up of Government paper accounted for over 50 per cent of the domestic Budget deficit. Reflecting a complex of factors, some data pertaining to which appear in Table 10, banking sector (excluding Reserve Bank) holdings of government debt fell by $252 million in 1976-77 compared with a rise of $71 million in 1975-76. This, together with portfolio adjustments of other sectors, meant that 56 per cent of total Budget financing was accounted for by borrowings from the Reserve Bank in 1976-77. Further details of Budget financing are set out in Statement No. 5. While sale of Government securities to the non-bank sector is generally the least inflationary method of financing a given deficit, that policy mix does not have the same advantages for anti-inflationary policy as a smaller Budget deficit. The securities acquired may be highly liquid assets readily convertible into cash - indeed even longer term bonds can be monetised without significant capital loss if official interest rates are not flexible upwards. Furthermore, the size of the public sector borrowing requirement has direct implications for the cost and availability of funds for private borrowers in financial markets. These points have added force when, against the background of a succession of large Budget deficits, the stock of outstanding Government debt has been greatly swollen. The deficit financing task during 1976-77 was not, then, just to place new paper in the hands of firm holders but to ensure also that as far as possible the outstanding stock in the hands of non-bank holders remained in such hands. The public sector's borrowing requirement seems to have been a little larger in 1976-77 than in 1975-76, after allowance for prepayment by the Commonwealth late in 1975-76 of some funds required by the States in 1976-77, which implied an artificial switch of State budget deficits from the earlier year to 1976-77. The reduction in the Commonwealth's Budget deficit was more than offset by growth in the borrowing programs of public authorities outside the Budget sector. Although corporate profits continued to record firm growth and demand for investment funds remained subdued in 1976-77, substantial stock accumulation *may* have meant (the data are extremely limited) that the corporate sector's borrowing requirement was larger than in 1975-76. New fixed interest raisings grew strongly in 1976 while equity financing by listed companies was2½ times the level of the year before. The fall in share prices over the early part of 1976-77 was reversed at the time of devaluation. The Sydney Stock Exchange All Ordinaries Index was 3 per cent lower at 30 June 1977 than a year earlier. The household sector's demand for funds remained firm, particularly for personal loans and housing finance. These financing requirements were met without a sharp rise in the general level of private sector interest rates; administered rates were unchanged. First mortgage rates for housing finance held steady. With the strong inflow of funds to banks and building societies during the liquidity upswing, lending for housing returned to a high level in the second half of 1976. In the March quarter 1977, when deposit growth was slower than expected, lending fell more than seasonally. However, the effects were short-lived, and a renewed pick-up began in the June quarter. {:#subdebate-65-3} #### Economic Outlook 1977-78 {:#subdebate-65-4} #### Background The preceding analysis has portrayed an economy that, for a variety of reasons, experienced a temporary pause in domestic activity around the end of calendar 1976 and into the early months of 1977. In discussing the various elements of the total picture, attention has been drawn to factors which could be expected to continue to depress and to others which can be expected to prove transitory. Most important in the latter category is that the balance of payments on current account has begun to show signs of improvement and can be expected to improve further over the months ahead. The expected gains from devaluation are taking time to emerge for import-competing industries, but should gather further momentum over the course of 1977-78. On the other hand, there are continuing forces, associated with still high inflation and the level of real wages, which will serve to hold back the pace of private sector recovery, and, more especially, of employment growth. Government policy for some time now has 'been based on the premise that control of inflation is fundamental to the achievement of other economic policy objectives. Some success has been achieved but the reduction of inflation necessarily remains the primary economic policy objective. It has also been increasingly recognised that longterm sustainable recovery in the economy will be possible only if the profitability of investment is restored to an adequate level. The Government has consistently pressed the case for continued moderation in wage increases as a means both of reducing inflation and restoring corporate profitability and employment. There have been encouraging improvements in profitability, but even after allowance for the influence of underutilised capacity, the rate of return on invested funds would not appear to be sufficient to ensure an adequate level of investment in the medium term. The prospects for significant growth in employment depend very much on the trend in real wages. So long as the price of labour, and particularly certain categories of labour, remains excessive relative to its product, there will continue to be both a tendency for contraction in the overall scale of production and, for any particular level of activity, a heightened tendency to substitute capital for labour. The latter process is now seemingly occurring at an advanced rate. Clearly, if the wage settlement processes do not serve to further reduce the share of labour in the national income, market forces will operate to reduce employment or at least the rate of growth of employment, and the same end will be attained - but more slowly and much more painfully. Changes in wage relativities and compression of margins have led to a change in the composition of unemployment at the cost of the female labour force, the young and the unskilled. Those changes cannot easily be reversed. In January this year, the Government announced in broad terms its intentions for this year's Budget; namely, constraining government outlays to within zero real growth and further reducing the deficit. These intentions were seen as consistent with the overall requirements of policy, and they remain so. In the months since then, the Government has reaffirmed in its decision-making the weight it places on the desirability of continuing fiscal restraint. As elaborated in the Treasurer's Budget Speech, not only is this expected to contribute directly to the primary objective of policy but also to permit, at an appropriate stage of the developing situation, some easing of the overall settings of monetary policy. Expenditure growth has, accordingly, been held back to 10.5 per cent in nominal terms and the deficit is estimated to be$2217 million (the corresponding domestic deficit is $1347 million). This compares with recorded deficits of $2740 million in 1976-77 and $3585 million in 1975-76 (and domestic deficits in the two years of $1995 million and $2905 million respectively) . What then is the economic outlook for 1977-78 and the period ahead given the Government's Budget decisions and' the background of other relevant developments? Forecasting is an uncertain undertaking at any time but is the more difficult in a period in whichthe economy is operating outside its normal range of functioning. A table of key economic ratios introduced in this Statement last year served to illustrate this observation. Its updated counterpart, Table 7, indicates that although considerable progress has been made in the return to stable conditions there is still some way to go. As already noted, the continuing high rate of inflation, together with the continuing high cost of labour relative to capital, have their implications for the recovery path. They also have their implications for uncertainty surrounding private sector expectations and decision-making. These heightened uncertainties naturally translate into uncertainties attaching to the macro-economic outlook. Expectations are obviously crucial, but the ways in which, and the extent to which, policy influences them cannot be predicted with precision. The following description necessarily makes judgments about how expectations are and will be developing and, on that basis, details the most likely path that the economy will take. By the nature of the exercise, the description cannot hope to be correct in all its specific elements although, hopefully, greater certainty should attach to the broad picture. {:#subdebate-65-5} #### Assumptions The following assumptions underlie the overall forecast. The improved budgetary situation will permit some gradual easing in monetary instruments over the course of 1977-78; the broad aim will remain to administer monetary policy so as to continue to provide adequate funds for sustainable recovery in private sector activity and employment, while continuing to bear down on inflation and inflationary expectations. o Apart from the Budget proposals themselves, -there will be no new fiscal measures during 1977-78. o The recovery in overseas economies will continue at a steady, albeit moderate, rate and Australia's balance of payments will strengthen over the course of 1977-78. o Seasonal conditions will be broadly consistent with a level of real farm product similar to that in 1976-77. o Partial indexation of award wages will continue, as will restraint in increases outside the indexation guidelines. It should be explicitly acknowledged that, so far as the last of these assumptions is concerned, the factors governing it are only indirectly within Commonwealth policy influence. Yet there can be no question that full indexation of wages would have most serious repercussions. Equally, exclusion from award wage adjustments of changes in the consumer price index attributable to devaluation and oil price increases is essential if the desired effects of these changes are to be fully garnered. To the extent that devaluation serves simply to raise the *general* domestic cost and price structure, its intended effect of increasing relative prices (and profitability) in the import-competing and export industries will not be achieved; similarly, if oil price increases flow significantly into prices generally via wage indexation adjustments, then the intended *relative* price effects of the policy will be to that extent eroded. {:#subdebate-65-6} #### Expenditures *Private consumption expenditure* is expected to grow at a moderate rate over the course of 1977-78, this being accompanied, as in 1976-77, by some decline in the saving ratio. Real household disposable income was boosted in the September quarter by the introduction of personal tax indexation and the new system of family allowances. It then fell slowly in the remaining quarters but for the year as a whole was 1.6 per cent higher than in 1975-76. Consumption increased by 2.8 per cent. In early 1977-78 there was again a significant increase in real disposable income because of the annual indexation adjustment of tax scales. The changes to the tax scales taking effect in February 1978 will lead to a further significant increase in the second half of the year. Further easing in the labour market could tend to dampen consumer confidence; so too would any acceleration in the rate of inflation. On the other hand a lift in private expenditures is now Occurring as the timing and other effects of the devaluation on spending recede. In summary, moderate growth in consumption is expected, accompanied by a lower average saving ratio than in 1976-77, but remaining well above its average level over the 1960s. *Investment in dwellings* weakened in the first half of 1977, as the industry cleared its excess stocks and the rate of loan approvals by major lenders slackened temporarily. Loan approvals quickened over the past quarter and the government has acted to remove any official restraints on lending for private home building. After allowance for some lag for these developments to show up in work done, the prospect is for activity in this area to return during 1977-78 to the high levels achieved in mid-1976. The timing of *investment in plant and equipment* over the course of 1976-77 has been influenced by taxation concessions and by the forward shift of investment in anticipation of devaluation-induced price rises. The marked improvement in corporate profitability and in actual and expected inflation, together with the incentive to substitute capital for over-costly labour, have all contributed to lifting the underlying growth in investment. Continued improvement in inflationary expectations and profitability, the expected modest uplift in domestic spending and product, and a quickening in the pace of mining activity should see the flatness in investment in plant and equipment of early 1977 give way to significant expansion over the course of 1977-78. Year-on-year growth may, however, be quite moderate as a result of the pattern of investment over the course of 1976-77. The outlook for *investment in other building and construction* is also encouraging. The steep decline in expenditure of the past two years appears to have been arrested in the first half of 1977. Private *other (non-residential) building* approvals and commencements, though erratic, were substantially higher in the second half of 1976 and into 1977 than a year or so earlier; and while the precise timing of the resultant investment is uncertain the outlook is for growth in this area through 1977-78. Private expenditure in the heavy *construction* area seems likely to benefit progressively from important new mineral developments expected to get under way in the period ahead. Continued growth in *government current expenditures* over the course of 1976-77 - primarily at the level of State and local governments - has been partly offset by declines in *government capital expenditures.* 1977-78 could well see more moderate growth in current expenditures together with some growth in capital expenditures. Again, however, growth is likely to be stronger at the State and local government levels; growth in the Commonwealth sector will be largely confined to semi-government authorities. The evidence of the past two quarters is that non-farm *stock accumulation* has slowed a little from the rates recorded in the second half of 1976. The ratio of stocks to sales now lies somewhat above the level of recent experience and, with a more moderate rate of growth in consumption than in 1976, there could be modest stock decumulation over 1977-78. {:#subdebate-65-7} #### Balance of Payments External transactions in 1977-78 will continue to respond to the net depreciation of the exchange rate in late 1976-early 1977 and the further depreciation in early August, as well as to overseas and domestic economic conditions. Overall, there is likely to be a deficit in the early part of the year, largely reflecting normal seasonal influences. However, with our international reserves now realistically valued and with a renewed program of moderate but steady borrowing abroad on government account, Australia's reserves are such that no difficulty is expected in financing such a deficit. During the latter part of the year, the balance of payments is expected to strengthen, with a resumption of additions to reserves. The present outlook is for continuing real growth, at a moderate pace, in Australia's major export markets. Subdued overseas demand in the early part of the year for certain Australian products may be followed by a strengthening as the year progresses. Export receipts should benefit from higher average prices, partly as a result of the full-year effect of devaluation. Higher Australian dollar import prices resulting from devaluation should lead to increasing substitution of domestic production for imports, which may also be affected by clearing of what may well have become some excess stocks. The trade balance is thus expected to strengthen further as the year progresses and the current account deficit should follow a similar pattern. On capital account, with the resumption of long-term official borrowing overseas already noted, a moderate net inflow is expected on government capital account. Transactions of primary produce marketing authorities are however expected to result in a net capital outflow in 1977-78, mainly in the first half of the year. Net apparent private capital inflow should increase in 1977-78. In particular, the prospects for increased domestic investment, and continued progress in reducing the underlying rate of inflation, should lead to higher long-term investment from overseas. {:#subdebate-65-8} #### Monetary Conditions The foregoing would imply moderate net monetary inflow on private sector account during 1977-78. The other major primary formation factor - domestic budgetary transactions - is estimated to contribute substantially less to private sector holdings of LGS assets than in 1976-77. Borrowings under approved programs for semi-government (Commonwealth and State) and local authorities are expected to increase by$245 million (see Budget Paper No. 7). The aggregate public sector demand for borrowed funds is thus likely to be no greater than in 1976-77. Security sales to the non-bank sector have been very strong in the past several months primarily reflecting, it would seem, expectations of lower interest rates associated with a more favourable inflation prospect. Given the favourable outlook for gross corporate profits, the present expectations for increased business fixed capital expenditure, the relatively small increase in company tax collections (see Statement 4) and the possible stock decumulation, the corporate sector seems likely to require, in aggregate, considerably less in borrowed funds from other sectors in 1977-78 than in 1976-77. The overall policy context of this Budget should serve to sustain the strength of official bond sales. This, when coupled with likely business demand for funds, holds open the prospect of lower growth in the monetary aggregates than in 1976-77 in conjunction with reduced pressure on interest rates and some gradual easing in the settings of other monetary policy instruments. In this connection, it will be noted from the Budget Speech that official restraints on lending for housing have been removed. Putting a little more precision on the outlook, expected growth in the volume of money (broadly defined) over the course of 1977-78 is in the range of 8-10 per cent given the assumptions and general environment discussed above. If the associated expectations about product and price outcomes are realised, this would continue to represent, as in 1976-77, monetary growth consistent with the objectives of policy; namely, to provide sufficient funds to underwrite sustainable recovery in private sector activity and employment, while maintaining downward pressure on inflation and inflationary expectations. Some increase in the velocity of circulation is expected. {:#subdebate-65-9} #### Product The outlook for domestic demand and the balance of trade is consistent with year-on-year growth in *gross non-farm product* in real terms of about 2 per cent between 1976-77 and 1977-78. Because of the pattern of change within 1976-77 - a strong early period followed by a flat close - 2 per cent growth for 1977-78 as a whole would represent an increase of more than 4 per cent *over the course of* the year; that is, from June quarter 1977 to June quarter 1978 non-farm product is expected to grow by over 4 per cent, compared with 1 per cent from June quarter 1976 to June quarter 1977. It is of course the rate of growth over the course of the year which influences the prospective trend from now on in such other elements in the outlook as employment and unemployment. Real farm product in 1977-78 will, as always, be greatly influenced by seasonal conditions; at present it is expected to be at much the same level as in 1976-77; on that basis, real aggregate farm income would be likely to fall from the previous year's level. {:#subdebate-65-10} #### Labour Market Given an expectation that real wage levels will continue to hamper demand for labour, the projected product growth of over 4 per cent over the course of 1977-78 would probably be accompanied by growth in *productivity* of more than half that amount. Employment growth from June 1977 to June 1978 is therefore likely to be something approaching 2 per cent. For the prospective development of unemployment the relevant comparison is between this anticipated employment increase from June 1977 to June 1978 and the likely change in the *labour force* over that period. Given expected job opportunities, the participation rate is likely to be litt'e changed at end 1977-78 from end 1976-77. On this basis, the labour force increment from June 1977 to June 1978 would be almost the same as the employment increase. Therefore, although there is some prospect for a reduction in *unemployment,* on balance the likeli- hood is for little or no change over this period. Given the pattern of product and employment changes, this through-the-year result would probably be accompanied by further easing (in an implicit seasonally adjusted sense) to around the end of 1977, followed by a moderate down-trend over the course of 1978 as product and employment growth gather momentum. Growth in employment in year-on-year terms in 1977-78 corresponding to growth from June 1977 to June 1978 approaching 2 per cent would be around 1 per cent; labour force growth on this basis would be about the same. The public sector is expected to generate some of this growth in employment, although less than in 1976-77; most of it is expected to occur in the private sector. {:#subdebate-65-11} #### Prices and Incomes This year's May decision of the Arbitration Commission recognised the serious consequences that would flow from compensating wage earners for devaluation-induced price increases. As noted above, similar consequences would flow from full compensation for the results of oil price increases. On the assumption that there will be some further discounting on both these accounts in the following decisions, with a degree of partial indexation for the balance of the increase in the consumer price index, the outlook for (male) *award wages* growth in 1977-78 is of the order of *0i* per cent following a 12.9 per cent increase in 1976-77. As noted in the discussion of the revenue estimates in Statement No. 4, the assumption that has been adopted for average weekly earnings is that they will also increase by 10! per cent in 1977-78. Because of the effects of the prices and wages 'pause' from mid-April of this year, the increase in the *consumer price index* in the June quarter was perhaps a little lower than it might otherwise have been. In addition, final prices have not yet fully reflected the increases in import and other prices that occurred in response to devaluation. The unwinding of both these factors may increase somewhat the September quarter outcome for the CPI. Similarly, the decisions relating to the prices of petroleum products will have a direct impact on the CPI in the December quarter and an indirect impact in that and later quarters depending on the speed and extent to which increased costs of transportation and production are passed through into final prices. On the other hand, a number of influences will be acting to reduce the underlying rate of price increase in 1977-78. This Budget continues the overall thrust of policy of the past couple of years - particularly reductions in the growth in government outlays and in the deficit and a slowing in the rates of increase in the monetary aggregates. Inflationary expectations are undoubtedly being wound down. Judgments about the inflation prospect depend on a range of interrelated factors including the rate of profit recovery. A slower rise in unit profits and or more favourable wage determination developments would mean a lower anticipated inflation rate. Whatever the outcome for the year as a whole there should be a first-half increase somewhat higher and a second-half increase somewhat lower than the increase for the year as a whole. That is to say, the expected pattern of change is for a slowing in the rate of inflation as 1977-78 progresses; the rate of change of *consumer prices* in the June quarter 1978 seems likely to be 2-2i per cent. Movements in *broadly-based deflators* would be of a similar order to that in consumer prices, with the downward trend in rates of change possibly emerging a little earlier. The movement towards import parity for domestic crude oil and other related decisions is expected to add something less than 1 per cent to aggregate price indexes during 1977-78. To the extent that wages are compensated for these policy-induced price rises, the general inflationary effect will, of course, be greater. In terms of the overall inflationary outlook, however, the major contributor will continue to be the wage indexation treadmill; if the Commission were to award increases at a lower degree of indexation than has prevailed, then the increase in prices in 1977-78 could be markedly less than in 1976-77. Projected growth in average weekly earnings and prices would lead to some decline in real average earnings per employed person over the course of 1977-78. Employment growth of the anticipated magnitude would, however, be sufficient to mean no decline in real aggregate earnings over the period. Given the actual and projected changes in personal taxes - the indexation reduction of 1 July 1977 and the new scales of 1 February 1978 - cash benefits and other income components, aggregate real household disposable income would in these circumstances show a noticeable rise over the course of the year, although not much change in year-on-year terms. Together with the expected increase in measured productivity, this outcome for wages and prices would be, as noted above, consistent with a further recovery in the profit share in national income. By mid- 1978, factor shares are likely to be closer to the levels of historical experience than for any time since mid-1973. The foregoing picture would represent a further significant step along a path of sustainable growth although not, clearly, one of rapid recovery. As has been the case for several years, recovery will be consolidated and strengthened the more rapidly inflation is wound down. This, in turn, remains heavily dependent on the extent to which money wage increases are held to less than inherited price increases. Arbitral decisions apart, success in that objective will continue to depend on the overall economic environment created by fiscal and monetary policy. {: .page-start } page 96 {:#debate-66} ### STATEMENT No. 3 - ESTIMATES OF OUTLAYS, 1977-78 {: .page-start } page 97 {:#debate-67} ### STATEMENT No. 3 - ESTIMATES OF OUTLAYS, 1977-78 This Statement presents detailed estimates of Budget outlays in 1977-78, classified according to their primary purpose or function. Comparable figures are also shown for 1975-76 and 1976-77; data for the period since 1967-68 are presented in Statement No. 6. {: .page-start } page 97 {:#debate-68} ### SUMMARY The following table shows, according to major functional and sub-functional headings, actual outlays in 1975-76 and 1976-77 and estimated outlays in 1977-78: The following chart gives a broad impression of the relative size of the major functional blocks of total outlays and recent and projected movements in those proportions. It is emphasized that changes in these functional blocks from one year to another are affected by a number of special factors, such as hospital pre-payments to the States in 1975-76, introduction of family allowances in 1976-77, large repayments by the Australian Wool Corporation in 1976-77 and 1977-78, and changes in administrative arrangements. Outlays for defence in 1977-78 are estimated at $2343 million, an increase of 7.4 per cent over 1976-77 and equivalent to 8.8 per cent of total Budget outlays. This estimate does not include any provision for increases in wages and salaries of defence personnel during 1977-78 although provision for such increases is made in the $90 million bulk allowance for wage and salary increases. {:#subdebate-68-0} #### Manpower Costs Provision has been made for an increase of $73.8 million in defence manpower costs in 1977-78. The main reasons for the increase are the full-year effects of awards and determinations made in 1976-77 and an increase in service strengths largely associated with the manning of new equipment coming into service and the activation of HMAS Stirling, Cockburn Sound, W.A. An increase in the number of pensioners and the effect of pension increases brought about by indexation, offset in part by one less pension payday in 1977-78, are the main factors accounting for the net increase of $14.9 million in the defence forces retirement and death benefits provision. Manpower costs are estimated to account for 52.6 per cent of total defence outlays in 1977-78 compared with 53.1 per cent of actual defence outlays in 1976-77. {:#subdebate-68-1} #### Defence Equipment and Stores Outlays on defence equipment and stores are intended to ensure that operational equipment (ships, aircraft, armour, artillery, etc.) are adequate to meet likely contingencies. Outlays on 'capital' type equipment in 1977-78 are estimated at $318.7 million, or $41.5 million more than in 1976-77. Substantial provision is made for many on-going acquisitions of new equipment including patrol frigates, an oceanographic ship, Oberon submarines, patrol boats and electronic counter measure equipment for the Navy, Leopard medium tanks, Rapier surface to air guided missile systems and Nomad aircraft for the Army and Hercules CI 30 and Orion long range maritime patrol aircraft for the RAAF. Provision also has been made for a start on some new major equipment projects and on other equipment, details of which will be announced by the Minister for Defence in due course. Expenditure on supporting equipment and stores is estimated at $222.9 million in 1977-78, compared with $196.6 million in 1976-77. Outlays on repair and maintenance of equipment and stores already in service - including periodic refit of naval vessels and overhaul of service aircraft, vehicles, etc. - is estimated to increase by $5.3 million. {:#subdebate-68-2} #### Defence Facilities Expenditure under this heading is to provide and maintain facilities, including adequate living and working accommodation for defence personnel. Advances to the States for the provision of housing for servicemen and their families are estimated at $26.1 million, $9.0 million less than the amount spent in 1976-77. In addition to this housing, which is being built by State Housing Authorities, the Commonwealth intends to acquire land and construct houses at Rockingham (W.A.) for personnel of the Cockburn Sound Naval Support Facility and of the ships to be based there. Other significant new projects include the acquisition of a large tract of land at Yampi ( W.A.) for use as a training area, the construction of Stage 2 of the development of Williamstown Naval Dockyard (Vic.) and Point Cook RAAF Base (Vic), and additional fuel storage facilities at military bases. Expenditure on these and other projects is expected to total $172.2 million in 1977-78 compared with $168.8 million in 1976-77. {:#subdebate-68-3} #### Industrial Capacity Tn the main, expenditure under this heading is directed towards the maintenance in Government factories and in industry of reserve production capacity considered essential for defence purposes. Expenditure is estimated at $53.6 million in 1977-78, compared with $51.3 million in 1976-77. Other expenditures covered under this item are the costs of production/ development of special defence projects in Government factories, such as Ikara and Turana, and in industry; production assistance for the construction of Nomad aircraft; and the acquisition and maintenance of reserve stocks of essential war material. The Government has also recently announced its approval to the production of a further 25 Nomad aircraft bringing the total approved for production to 120. {:#subdebate-68-4} #### Defence Science and Technology Establishments Expenditure on defence science and technology is aimed at assisting the Services to keep abreast of advances in defence technology and at developing weapons and weapon systems suited to Australia's defence needs. The estimated expenditure of $91.6 million in 1977-78 covers the salaries, other administrative and operating expenses, machinery, plant and works services of defence science establishments and laboratories and the Woomera range. Some reduction in overall manpower levels is planned, but provision has been made for continuation of a modest level of trials activity at Woomera, in conjunction particularly with the United Kingdom. Defence Co-operation Through defence co-operation the Government aims to help friendly countries in the region to strengthen their own and the region's defence capacity. Estimated expenditure of $25.9 million in 1977-78 ($25.4 million in 1976-77) includes $7.2 million to Indonesia as part of Australia's current three year commitment program of $25 million which terminates 30 June 1978, and $4.8 million for continuing assistance to Malaysia and Singapore. An amount of $13.2 million is also included for defence co-operation activities with Papua New Guinea in 1977-78, compared with $14.0 million last year. The small decrease reflects the progressive reduction in numbers and support costs of Australian servicemen in Papua New Guinea in line with the continuing localisation of the Papua New Guinea Defence Force. The allocation of $0.7 million for 'other countries' reflects the provision of military training and advisory assistance to such countries as the Philippines and Thailand and the development of closer defence relations with Fiji and other countries in the South West Pacific region. {:#subdebate-68-5} #### Storage and Transport Services This item comprises removal costs of servicemen and their families on re-posting, transfer of defence civil staff and their families, and storage costs associated with those activities. {:#subdebate-68-6} #### General Administrative Expenditure This broad category of expenditure covers a range of items including travel, office requisites, postage and telephone services, fuel, light, power and water supply, freight and cartage, compensation payments and medical and dental services. The budgeted increase of $11 .0 million largely reflects increases in the costs of these services and some increased levels of activity. {:#subdebate-68-7} #### Natural Disasters, Civil Defence and Other Included under this heading are outlays on the upkeep of the Natural Disasters Organisation, Commonwealth assistance to State/ Territorial Emergency Services through purchases of equipment and stores for those Services, and reimbursement of some salaries paid by the States to their civil defence personnel. Other outlays for civil defence, maintenance of war graves and various miscellaneous items are also included. {:#subdebate-68-8} #### Recoveries and Repayments The principal elements here are payments made 'by servicemen under the Defence Force Group Rental Scheme for rent of houses provided for their use, charges made for meals and accommodation provided at Defence establishments, contributions by other countries towards the cost of joint defence activities, revenue from disposal of surplus defence equipment and stores, and miscellaneous receipts. {:#subdebate-68-9} #### Loan Act In 1976-77 it was necessary to transfer an amount of $1504 million of defence expenditure from Consolidated Revenue Fund to Loan Fund to meet a prospective deficit in the former Fund. Expenditures transferred were financed from borrowings. The Budget estimates for 1977-78 show a prospective deficit in the Consolidated Revenue Fund of $901 million in the absence of further action to meet that deficit. The intention is that this potential deficiency should again be met by transferring sufficient defence expenditures from the Consolidated Revenue Fund to the Loan Fund where they will be financed from borrowings for defence purposes. A Loan Bill to authorize these transactions will be introduced into Parliament during the Budget session. {: type="1" start="2"} 0. EDUCATION Total outlays on education are estimated to increase by $210.9 million - or 9.8 per cent - in 1977-78 to $2371 million; this total is equivalent to 8.9 per cent of estimated total outlays. The 1977-78 estimates for the programs of the education Commissions relate to the second half of the previously determined 1977 programs and the first half of the recently determined 1978 programs. For 1978 the base programs for universities, colleges of advanced education and schools are to be maintained at the same levels in real terms as in 1977; the base program for technical and further education is to be increased by 10 per cent in real terms. From 1978 these base programs will be supplemented for wage and salary increases in respect of recurrent grants only; up to, and including 1977, supplementation has been provided for all cost increases. For planning purposes only the Government has announced guidelines for 1979 and 1980 which provide for increases of 2 per cent each year in real terms in the base programs for the tertiary area as a whole, and 1 per cent for schools. The Commissions are due to report by 31 August on the detailed allocation of funds for the 1978-80 rolling triennium within the guidelines announced by the Minister for Education on 3 June. {:#subdebate-68-10} #### Tertiary Education {:#subdebate-68-11} #### Universities and Colleges of Advanced Education As mentioned above, base expenditure programs for universities and colleges of advanced education in 1978 have been set at the same real levels as for 1977. Student intakes for both sectors are expected to be maintained at the present level. Some additional funds are to be provided in 1978 'for non-government teachers colleges. At estimated June 1977 price levels, grants to universities are estimated to total $675.6 million in 1977-78, an increase of $35.5 million over 1976-77. The bulk of these funds will be expended on academic and administrative salaries within the universities, and on equipment, research and other operating costs. The proportion allocated for capital purposes is expected to decline further this year compared with earlier years when new universities were being established. Grants to colleges of advanced education (including teachers colleges) are estimated to increase by $7.5 million to $469.3 million in 1977-78 (at estimated June 1977 prices). As with universities, the proportion of these funds allocated for capital purposes is expected to decline relative to recent years. The Government is proceeding with the development of the Australian Maritime College at Launceston, which is expected to begin courses in 1979. Amounts of $1.6 million for capital purposes and $0.3 million for recurrent expenditures are to be provided for the College in 1977-78 from within the allocations for the advanced education sector. The Government has sought an assessment by the new Tertiary Education Commission of an imbalance that appears to be developing between the supply and demand for teachers. The Commission is to provide advice on possible options that the Government might consider and to explore with State and other authorities the scope for reduction in trainee teacher intakes. The Government also has reviewed its program of recurrent assistance to nongovernment teachers colleges. In recognition of the contribution which these colleges make towards the preparation of teachers for non-government schools an amount of $1.4 million (at estimated June 1977 prices) is to be provided for these purposes in 1977-78 within the total funds available for the advanced education sector for 1978. {:#subdebate-68-12} #### Student Assistance The Tertiary Education Assistance Scheme provides living and other allowances for undergraduate students. Subject to a means test all full-time non-bonded Australian undergraduate students admitted to approved courses at approved universities, colleges of advanced education and teachers colleges are eligible to receive these benefits. Following a review of all student assistance schemes in late 1976 benefits were increased substantially, and means tests relaxed, with effect from the beginning of 1977. It has been decided to further relax means tests and to increase allowances from the beginning of the 1978 academic year. The maximum (independent student) living allowance payable under the Tertiary Education Assistance Scheme (TEAS), which was increased from $32 per week in 1976 to $43 per week in 1977 is to be further increased to $45.15 per week from the beginning of 1978. The means test to determine the level of allowance payable, which was relaxed from the beginning of 1977, is also to be relaxed further from the beginning of 1978. Taking into account these proposed changes, the cost of TEAS for students attending universities and colleges of advanced education is estimated to increase from $112.0 million in 1976-77 to $137.4 million in 1977-78. About 85 000 students are expected to qualify for this assistance in 1978, an increase of 5000 on 1977 numbers. Living allowances under the Post-graduate Awards Scheme, which provides assistance for post-graduate students on a competitive non-means-tested basis, were increased from $3250 per annum to $4000 per annum at the beginning of 1977. From the beginning of 1978 they will be further increased to $4200 per annum. This scheme is estimated to cost $9.7 million in 1977-78 compared with $8.6 million in 1976-77. About 2130 students are expected to benefit from the scheme in 1978, about 100 less than in 1977. {:#subdebate-68-13} #### Technical and Further Education The Commonwealth meets the full cost of technical and further education in the Territories, and provides financial assistance to the States for these purposes. This assistance to the States is directed towards enhancing the quality and extending the availability of technical and further education, and is provided on the understanding that the States do not reduce the level of their own activities in this area. A base amount of $94.4 million (at estimated June 1977 prices) has been determined for the Commonwealth's program of assistance to the States in 1978. This represents a 10 per cent increase in real terms compared with 1977. Total Commonwealth expenditure on grants for technical and further education in 1977-78 is estimated at $113.0 million (at estimated June 1977 prices), compared with actual expenditure of $100.1 million in 1976-77. Total enrolments in these institutions (full-time, part-time and correspondence students) are expected to increase by about 7.6 per cent in 1978, to approximately 828 000 students. The new Tertiary Education Commission has been asked to pay special attention to the requirements of the TAFE sector and to develop co-operative arrangements with *the* States for the allocation of resources on the understanding that the States will continue to discharge in full their own financial responsibilities in this area. {:#subdebate-68-14} #### Student Assistance TEAS assistance is available to students attending approved technical colleges at the same levels and on the same terms as for students attending universities and colleges of advanced education. The cost of providing assistance to technical college students in 1977-78 is estimated at $29.1 million, compared with $23.8 million in 1976-77. About 22 000 students are expected to qualify for this assistance in 1978, an increase of 2000 on the 1977 numbers. {:#subdebate-68-15} #### Tertiary Education Administration The Tertiary Education Commission was established on 22 June 1977 to replace the three separate education Commissions relating to Universities, Advanced Education and Technical and Further Education which formerly operated in the tertiary education field. The Tertiary Education Commission is responsible for advising the Government on levels of financial assistance for universities, colleges of advanced education and technical and further education institutions. It is required to perform its functions with the objective of promoting the balanced and co-ordinated development of tertiary education in Australia. The Commission is to consult with appropriate State authorities in the performance of its functions and in formulating its recommendations is to have regard to greater rationalisation of the use of resources and more extensive use of facilities throughout the year. It is also to examine proposals for establishing new courses and for lengthening or upgrading of established courses. *Committee of Inquiry into Education and Training* In recognition of the need to achieve a more efficient use of the resources allocated to education and to relate the educational system more closely to workforce requirements, the Government has set up a Committee of Inquiry into Education and Training under the chairmanship of Professor B. R. Williams. This Committee will be focusing particularly on post-secondary education but will also examine aspects of secondary education and the problems of transition of school leavers directly into the labour force. {:#subdebate-68-16} #### Schools Expenditure by the Commonwealth Government on schools in 1977-78 is estimated at $753.1 million, an increase of $38.5 million or 5.4 per cent over 1976-77. This total excludes assistance provided for pre-school and child care projects in the States which is included in the Social Security and Welfare block. (A detailed account of financial assistance for schools in the States is included in Chapter IV of *Payments* Available enrolment projections for primary and secondary schools in Australia point to a levelling out of total enrolments in 1978 and to a declining trend thereafter. *Schools in the States* The Commonwealth makes grants to the States to assist both government and nongovernment schools under programs administered by the Schools Commission. Grants are estimated to total $600.1 million in 1977-78 (at estimated June 1977 prices), an increase of $30.6 million or 5.4 per cent over 1976-77. Assistance is provided for general recurrent purposes at government and non-government schools, for the construction of new, and upgrading of existing, buildings, for libraries, disadvantaged schools, innovatory projects and teacher development, and for migrant and handicapped children. *Government Schools and Pre-schools in the Territories* Outlays for government schools and pre-schools in the Territories are estimated at $118.5 million in 1977-78, an increase of $2.5 million compared with actual outlays in 1976-77. The Australian Capital Territory Schools Authority was established on 1 January 1977 to administer and develop the Government's pre-school, primary and secondary education systems in the Capital Territory. Expenditure on government schools and pre-schools in the Capital Territory is estimated to increase by $2. 1 million in 1977-78 to $74.1 million. Provision is made in the estimates for the staffing and equipping of one new secondary college, one new high school and two new primary schools. The wage and salary costs of the Authority are estimated to increase by $6.0 million and school servicing costs by a further $2.5 million. These increases have been partially offset by a reduction of $6.4 million in capital outlays on schools, reflecting a slowing down in the rate of growth of Canberra's population and, consequently, a reduced demand for new student places. Expenditure on government community schools in the Northern Territory is estimated to increase from $44.0 million in 1976-77 to $44.4 million in 1977-78. (See also references to the education of Aboriginals in Northern Territory under 'Special Groups'). Provision has been made in 1977-78 for an estimated increase in salaries of $4.5 million. This increase is partially offset by an estimated decrease of $4.2 million in expenditure on school construction in the Northern Territory. *Non-government Schools in the Territories* From 1965 to 1974 the Commonwealth Government provided assistance under the Capital Aid Scheme to non-government schools in the Australian Capital Territory and Northern Territory for school building projects. The Scheme was terminated from 30 June 1974 although projects approved under the Scheme before that date have continued to be supported. The Government has decided that future non-government school building projects in the Territories should attract assistance on similar principles to those operating in respect of the Schools Commission's program of capital assistance for non-government schools in the States. An amount of $1 million is provided in 1977-78 for the support of new projects on this basis. The Government has also decided to establish an interest subsidy scheme to enable non-government schools in the Territories to borrow from approved lending authorities to finance building projects approved by the Minister for Education. The Commonwealth will reimburse interest charges, up to 10 per cent, on the borrowing, over a period of up to 20 years; an amount of $40 000 is included in the 1977-78 estimates for interest subsidies under this scheme. In total, assistance for non-government schools in the Territories is estimated to increase from $11.2 million in 1976-77 to $13.1 million in 1977-78. {:#subdebate-68-17} #### Student Assistance Expenditure on assistance for school students in 1977-78 is estimated at $14.9 million, compared with $11.6 million in 1976-77. Included in these amounts is $6.3 million in 1977-78 (S4.6 million in 1976-77) for the Adult Secondary Education Assistance Scheme, under which means-tested allowances are made available to adults undertaking full-time studies in the final year oi secondary schooling Benefits and the means test are the same as apply under the Tertiary Education Assistance Scheme. Approximately 3000 students are expected to qualify for assistance under the scheme in 1978, an increase of some 300 on the 1977 numbers. Also included in the estimate for 1977-78 is $8.4 million (compared with $6.9 million in 1976-77) for the Secondary Allowances Scheme, under which means-tested allowances are provided to assist low income families to maintain their children at school for the final two years of secondary education. The maximum rate of living allowance payable under the Scheme was increased from $450 per year to $550 per year to take effect from the beginning of 1977. In 1978 almost 17 000 students are expected to qualify for this assistance, an increase of about 500 on the number receiving the benefit in 1977. {:#subdebate-68-18} #### Cost Supplementation The programs of the education Commissions are supplemented, with lags, for cost increases. The 1977 programs are to be supplemented fully for cost increases subject to offset to the extent possible by savings; but from 1 978, supplementation is to be limited to wage and salary increases in respect of recurrent grants only including the fees reimbursement component in the technical and further education program. The bulk allowance of $75 million for cost supplementation included for 1977-78 relates mainly to estimated requirements in respect of the 1977 programs. The comparable figure included in the estimates last year was $60 million. {:#subdebate-68-19} #### Special Groups Assistance by the Commonwealth for the education of special groups is estimated to total $70.8 million in 1977-78, compared with $62.0 million in 1976-77. {:#subdebate-68-20} #### Aboriginal Education Two student assistance schemes provide special benefits to Aboriginal students. Benefits under these schemes were increased substantially at the beginning of 1977 and some allowances will be increased further from the beginning of 1978. The Aboriginal Secondary Grants Scheme provides assistance to all full-time students of Aboriginal descent attending approved secondary schools or classes. Expenditure on this Scheme is estimated at $12.1 million in 1977-78, compared with $10.0 million in 1976-77. Approximately 14 000 students will be assisted in 1978, an increase of about 700 on the number in 1977. The Aboriginal Study Grants Scheme provides, in the main, assistance to Aboriginal students undertaking courses at universities, teachers colleges and technical, business and agricultural colleges. It also provides for overseas study, observation and short-term courses. Total expenditure is estimated at $3.3 million in 1977-78, compared with $2.3 million in 1976-77. Almost 2800 students are expected to receive assistance in 1978, about *600* more than in 1977. The Commonwealth Government has direct responsibility for the education of Aboriginal children in the Northern Territory and has provided for estimated expenditure of $18.2 million in 1977-78, compared with $15.6 million in 1976-77. The main components of the increase of $2.7 million are salaries ($0.6 million), school running costs ($0.7 million), recurrent assistance to Missions for education of Aboriginals ($0.4 'million) and school construction ($0.8 million). In addition, the Government has included a provision of $0.25 million for new and expanded activities in Aboriginal Education in the Territory, including a new program of capital assistance for school building projects on Missions to be administered by the Department of Education, equipment for Aboriginal education in Northern Territory 'outstation' communities and for the development of an education complex at Ti Tree. A provision of $9.2 million is made in the Budget for grants to the States and to non-government organisations tor Aboriginal education purposes in 1977-78. These grants will finance the construction and equipping of pre-schools and primary and secondary schools. Additional expenditure will be incurred on several programs of special assistance for schools with high Aboriginal enrolments, and on special courses in Aboriginal studies at tertiary institutions. Comparable expenditure in 1976-77 was $8.5 million. The Budget also provides $85 000 in 1977-78 for the continued operation of the new National Committee on Aboriginal Education. The Committee, which consists entirely of Aboriginals and Torres Strait Islanders, provides advice and information on the educational needs of Aboriginals. Total assistance for Aboriginal education under these programs is estimated at $43.0 million in 1977-78 compared with $36.4 million in 1976-77. {:#subdebate-68-21} #### Migrant Education The Commonwealth provides funds for special instruction for migrant children with English language difficulties to facilitate their participation in normal classes. Funds are provided to government and non-government school authorities for special language teaching equipment, for salaries of special teachers and for the initial special instruction of refugee children. An amount of $0.6 million will be provided in 1977- 78 to enable the program to be maintained at the same real level of activity as in 1976-77 when $0.5 million was spent. Adult migrant education in the English language is conducted in special courses. Expenditure, including salary and administrative costs and living allowances for some students, is estimated at $9.5 million in 1977-78 compared with $8.8 million in 1976- 77. Again this will enable the present level of activity to be maintained in 1977- 78. Living allowances payable to migrants undertaking full-time English courses are to be increased by about 25 per cent from 1 November 1 977 to bring them up to a level equal to that of TEAS. For single students the allowance will be $45.15 per week; married students with a dependent spouse will receive $76.55 per week. An amount of $0,162 million is included in the 1977-78 estimates for the final year of a program of providing demountable classroom accommodation for child migrant classes in government and non-government schools. {:#subdebate-68-22} #### Soldiers' Children Education Scheme This Scheme provides for payment of fees, fares and allowances, and for provision of books and equipment for the tertiary education and training of children of exservicemen who died as a result of war service or who are either totally and permanently incapacitated or blind. Allowances are also paid in respect of children attending secondary schools. The cost of this scheme is estimated at $3.6 million in 1977-78, compared with $3.5 million in 1976-77: a slight decrease in the number of beneficiaries has been more than offset by the full year effect of the increased allowances effective from January 1977. {:#subdebate-68-23} #### Isolated Children The Commonwealth provides assistance through the Assistance for Isolated Children Scheme to children who, because of their geographical isolation, do not have reasonable daily access to a government school providing courses at the appropriate level. A basic boarding allowance which was increased from $350 per annum to $500 per annum from the beginning of 1977 and an additional means tested allowance (which was increased from $350 per annum to $450 per annum and will be increased further to $500 per annum from the beginning of 1978), are payable in respect of such children living away from home to attend school. Additional assistance is available in cases of particular hardship. For isolated children who study at home by correspondence there is an allowance free of means test which was increased from a maximum of $350 per annum to $500 per annum at the beginning of 1977. The estimated cost of the scheme in 1977-78 is $13.8 million, compared with actual expenditure of $11.7 million in 1976-77. Almost 20000 children are assisted each year under the scheme. {:#subdebate-68-24} #### General Administrative and Other Expenditure General administrative and other expenditure of the Department of Education is estimated at $22.0 million in 1977-78, compared with $21.4 million in 1976-77. The estimate for 1977-78 includes $15.3 million for salaries. Also included under this heading is $1.93 million for the Curriculum Development Centre, which has been established as an independent statutory authority to develop school curriculum projects, and $0.9 million for the Education Research and Development Committee, which provides support for research in education. {: type="1" start="3"} 0. HEALTH Total outlays on health are estimated at $2813.8 million in 1977-78, an increase of 10.7 per cent on 1976-77. If the 1976-77 figures are adjusted for the prepayment of $216 million made to the States in June 1976 for hospital operating costs, the increase is 2.0 per cent. Outlays on Health in 1977-78 represents 10.6 per cent of total Budget outlays. Figures of actual outlays in 1975-76 and 1976-77 and estimated outlays in 1977- 78 are shown in the following table: {:#subdebate-68-25} #### Medical Services and Benefits {:#subdebate-68-26} #### Medibank Benefits This item shows estimated expenditure in 1977-78 for the payment of basic medical and optometrical consultation benefits for all persons who are not covered by full private medical and hospital insurance. Entitlement to health insurance benefits is universal for all Australian residents. Since 1 October 1976, when revised arrangements came into operation, coverage is achieved in one of two ways: {: type="a" start="i"} 0. *Medibank Standard.* For medical and optometrical consultations, Medibank Standard provides benefits of 85 per cent of schedule fees (with a maximum patient contribution of $5 for any one service where the doctor charges the schedule fee) to those persons who elect to pay the health insurance levy and to those persons who are exempted from the levy (other than those fully covered by private insurance) such as low income earners, most pensioners, certain Defence Force personnel and Repatriation beneficiaries. Persons covered by Medibank Standard are also entitled to free standard ward accommodation in public hospitals, with treatment by doctors engaged by the hospital. They may, however, purchase basic 'hospital only' cover from a registered health insurance organisation to provide for treatment by a doctor of their own choice in shared-room or private room accommodation in public hospitals. The hospital fund benefits may also be applied towards meeting charges for treatment in private hospitals. {: type="i" start="ii"} 0. *Full Private Medical and Hospital Cover.* This provides both hospital and medical benefits through private insurance. Persons opting to be exempted from the levy can do so by insuring privately with a registered health insurance organisation. Coverage is provided for the same medical benefits as for levy payers, and for shared and private rooms in public hospitals and for private hospital care. After allowances for cost increases, expenditure on medical services and optometrical consultations to be met in respect of Medibank Standard patients is estimated to amount to S4S0 million in 1977-78. This is S90.2 million less than expenditure for 1976-77, but it should be noted here that the revised health insurance arrangements under which persons may opt for private medical and hospital cover in lieu of Medibank Standard applied only from 1 October 1 976. {:#subdebate-68-27} #### Other Medical Benefits Included here are residual expenditures on medical benefits for services that were rendered under the National Health Act prior to the commencement of Medibank on 1 July 1975. It is estimated that expenditure on these benefits will amount to only $0.2 million in 1977-78. {:#subdebate-68-28} #### Diagnostic Services This item covers the running costs of the Commonwealth Pathology Laboratories which provide services to hospitals and medical practitioners, and the cost of supplying radio-active isotopes by the Australian Radiation Laboratory to hospitals and medical practitioners. Charges are to be introduced on 1 October 1977 for services undertaken by the Commonwealth Pathology Laboratories for privately insured patients. From 1 January 1978 responsibility for the supply of radio-active isotopes is to be transferred to the Australian Atomic Energy Commission. The impact of these measures on expenditure under this item will more than offset the full year effect of cost increases that occurred in 1976-77, resulting in a net decrease in outlays in 1977-78 of $2.9 million to $16.6 million. {:#subdebate-68-29} #### Treatment and Allowances for Ex-Servicemen and Women The Commonwealth meets the costs for eligible persons of specialist, local medical officer, paramedical and dental services, of providing and maintaining surgical aids (including spectacles) and of travelling expenses incurred in obtaining medical treatment. Expenditure on these activities in 1977-78 is estimated to increase by $5.2 million to $45.9 million, reflecting increased fees for professional services together with rising demand for treatment. {:#subdebate-68-30} #### Hospital Services and Benefits {:#subdebate-68-31} #### Medibank Hospital Payments This item shows Commonwealth expenditure for hospitals under the provisions of the *Health Insurance Act* 1973. It covers daily bed payments to private hospitals of $16 a day and 50 per cent of the approved net operating costs of public hospitals in the States and Territories. In public hospitals, treatment in standard wards is provided free to those persons covered by Medibank Standard who have no additional hospital insurance coverage. With the revised health insurance arrangements applying from 1 October 1976, the charges in public hospitals for privately insured patients have been $60 a day for a bed in a single room and $40 a day for any other bed. The figure for expenditure in 1976-77 on hospital benefits excludes an advance of $215.6 million which was paid in June 1976 under the States Grants (Hospital Operating Costs) Act for the period 1 July to 30 September 1976. There were subsequent adjustments resulting in net repayment to the Commonwealth in 1976-77 of $6.1 million of the amount previously advanced. Allowing for the prepayment in 1975-76 and subsequent adjustment in 1976-77, the 1977-78 estimate of Medibank hospital payments of $1044 million represents an increase of about $103 million. {:#subdebate-68-32} #### Hospital Insurance Subsidy This item provides for the subsidy payable to registered health insurance organisations in respect of the contribution rates for basic 'hospital only' insurance offered to persons who are covered by Medibank Standard. The estimated cost of the Commonwealth subsidy in 1977-78 is $15 million. {:#subdebate-68-33} #### Hospital Benefits Reinsurance Trust Fund As provided by the National Health Act, the Commonwealth subsidises the private health funds by sharing deficits that may arise in reinsurance accounts required to be maintained by registered hospital insurance organisations. The deficits occur from paying benefits to high risk and chronicallyill members. The estimated expenditure from the Trust Fund by the Commonwealth in 1977-78 is $50 million, an increase of $34.5 million. {:#subdebate-68-34} #### Other Hospital Benefits This item reflects mainly expenditure authorised by the National Health Act on special account subsidies that ceased on 30 September 1976 with the establishment of the Hospital Benefits Reinsurance Trust Fund. Carry-over expenditure in 1977-78 is estimated at $5.1 million. {:#subdebate-68-35} #### Repatriation Hospitals Hospitals and clinics are maintained in each State for the treatment of eligible veterans and dependants but to a limited extent non-repatriation patients are also treated in Repatriation hospitals. Use is also made of private and State public hospitals where this is appropriate. Expenditure in 1977-78 is expected to increase by $13.6 million. Of this, $3.7 million represents the increased cost, arising mainly from the full-year effect of higher charges, of maintaining patients in metropolitan and country hospitals. The balance of $9.9 million reflects higher wages and salaries and operational costs associated with the running of Departmental institutions, as well as additional expenditure on buildings and works. {:#subdebate-68-36} #### Mental Health Facilities Expenditure on mental health facilities is estimated at $8.0 million in 1977-78. This expenditure includes annual payments to the New South Wales and South Australian Governments for the cost of maintaining residents of the Australian Capital Territory and the Northern Territory receiving psychiatric treatment in those States, and the cost of medical care and treatment for eligible ex-servicemen and women at State mental hospitals. Assistance for non-residential mental health facilities is provided under the Community Health Program, while funds for residential mental health facilities are provided under the Hospitals Development Program. {:#subdebate-68-37} #### Hospitals Development Program Grants are extended under this Program to the States to assist in the provision and modernisation of approved public hospitals and other residential health facilities such as mental institutions, hostels for the mentally ill and nursing homes and hostels for the physically infirm. These funds are conditional on the States maintaining certain baseline levels of expenditure. As announced previously, the Commonwealth will provide$50 million for the Program in 1977-78, compared with$108 million in 1976-77. {:#subdebate-68-38} #### Health Program Grants Health Program Grants, authorised under the *Health Insurance Act* 1973, are payable to eligible organisations to meet the cost, or such proportion of the cost as the Minister may determine, of approved health services, including contract medical services, provided outside of hospitals, by medical practitioners employed on a salaried or sessional basis. With the restructuring of Medibank from 1 October 1976, eligible organisations have introduced charges, where appropriate, for services involving privately insured patients. The Government has decided also to expand the application of Health Program Grants to include the development and testing of new forms of health care delivery, the promotion of accreditation utilisation review and quality assurance processes across the whole range of health activities, and the examination of new methods of meeting service operating costs to introduce greater incentive towards efficiency. Expenditure on Health Program Grants in 1977-78 is estimated to amount to $8.7 million compared with$6.0 million in 1976-77. {:#subdebate-68-39} #### Pharmaceutical Services and Benefits {:#subdebate-68-40} #### Pharmaceutical Benefits - General and Pensioners Except for a flat charge of *$2 per* prescription payable by most patients, the Commonwealth meets the cost of a range of drugs and medicinal preparations supplied on a doctor's prescription to any person in the community. PHB (Pensioner Health Benefits) card holders and their dependants are eligible for benefits without charge. Estimated expenditure on general pharmaceutical benefits in 1977-78 is$1 36.5 million, an increase of $16.8 million compared with 1976-77. This reflects mainly the prescribing of higher cost drugs and an increase in utilisation of benefits. For the same reasons, expenditure on pharmaceuticalbenefits for eligible pensioners is estimated to increase by $1 1.5 million in 1977-78 to $126.7 million. {:#subdebate-68-41} #### Pharmaceutical Benefits - Ex-Servicemen and Women The Commonwealth meets the full cost of drug and medicinal prescriptions supplied on a doctor's prescription for eligible ex-servicemen and women and their dependants. Expenditure for this purpose is estimated to increase by$2.3 million in 1977-78 to $33.5 million and is attributable mainly to payments for retrospective increases in chemists' dispensing fees. {:#subdebate-68-42} #### Nursing Home and Domiciliary Nursing Care Services and Benefits {:#subdebate-68-43} #### Nursing Home Benefits and Payments As previously announced, legislation will be introduced to provide new arrange ments for the payment of nursing home benefits as from 1 October 1977. These arrangements will provide a much higher level of protection for patients in private nursing homes than in the past. From 1 October 1977 the following benefits will be payable by the Commonwealth for levy-payers and those exempt from the levy who are not insured with a private hospital benefits fund, and by private health funds for all members insured in the standard hospital benefits table (or above): Private hospital benefit funds will also pay benefits for members who are patients in those nursing homes whose operating deficits are met by the Commonwealth. The benefits, when combined with the statutory patient contribution, will fully cover fees charged in each State to 70 per cent of patients in non-government nursing homes approved under the National Health Act, as compared with about 30 per cent at present. The levels of benefit will be automatically reviewed each year after a survey of nursing home fees and will be adjusted as necessary. Mainly because of the higher levels of Commonwealth benefit that will apply from 1 October 1977, expenditure on nursing home benefits is estimated to increase by $16.9 million to $181.2 million in 1977-78. After allowance for cost increases, financing the deficits of eligible nursing homes is estimated to cost $69.3 million in 1977-78, a decrease of $0.8 million. {:#subdebate-68-44} #### Domiciliary Nursing Care Benefit The Commonwealth pays a benefit of $2 a day to persons who arrange for the provision of adequate nursing care for elderly relatives at home as an alternative to institutional care. The elderly relative must have attained the age of sixty-five years and require professional nursing care to an extent that would otherwise justify admission to an approved nursing home. Expenditure on the benefit is estimated to increase by $0.2 million in 1977-78 to $8.3 million. {:#subdebate-68-45} #### Nursing Home and Domiciliary Nursing Care for Ex-Servicemen and Women The Commonwealth meets the full cost of nursing home accommodation required by ex-servicemen and women because of service-related disabilities. It also meets the cost of nursing home care for disabilities not related to service for certain categories of veterans and war widows, subject to payment by the patient of the patient contribution prescribed for other nursing home patients in the community. Free domiciliary care services are provided to these groups as required. Expenditure on nursing home and domiciliary care for eligible persons is expected to increase by $1.1 million in 1977-78 to $28.4 million. The increase is attributable to higher nursing home charges and increased usage. {:#subdebate-68-46} #### Other The item provides for subsidies, estimated to cost $10.5 million in 1977-78, to approved non-profit organisations that provide home nursing services. The rate of subsidy was increased with effect from 1 July 1977. For organisations established before September 1956, the annual Commonwealth payment for each nurse who attracts a subsidy was increased from $8600 to $9600. For organisations established after that date, the annual subsidy for each nurse employed was increased from $4300 to $4800. The Commonwealth subsidy to any organisation may not exceed that paid to the organisation by a State. The increase in the subsidy is expected to cost $1.06 million in 1977-78. {:#subdebate-68-47} #### Community Health Facilities and Services The Commonwealth is providing assistance to the States, local government authorities and other eligible organisations for the provision of community-based health services. Some 700 projects 'have been approved; they include community health centres, day hospitals, community mental health teams and alcoholism and drug dependence centres. Commonwealth assistance for the Program in the States is provided in the form of an annual block grant to each State which allocates the grant to individual projects. Except for projects having an Australia-wide application, the Commonwealth will meet, from' 1 July 1977, 50 per cent of capital and 75 per cent of operating costs. The previous capital subsidy of 75 per cent will apply to projects not completed by 30 June 1977. 'National' projects - such as the Family Medicine Program - which operate in all or most States are funded direct by the Commonwealth. An amount of $79.1 million has been allocated to the Program for 1977-78; this is $9.3 million more than expenditure on the Program in 1976-77. In addition, grants to the States and institutions for health care planning and research are estimated at $0.8 million in 1977-78, compared with $1 million in 1976-77. {:#subdebate-68-48} #### Treatment and Prevention of Tuberculosis Reimbursement by the Commonwealth of capital and maintenance expenditures by the States on the diagnosis and treatment of tuberculosis ceased from 31 December 1976. The Government decided that because tuberculosis had been brought under control in Australia there was no longer a need for Commonwealth assistance. Costs incurred by public hospitals in treating tuberculosis patients have been subsumed within the Medibank hospital arrangements. Provision is made to reimburse States' expenditure incurred up to 31 December 1976 and for continuation of allowances to persons suffering from tuberculosis and their dependants. Expenditure under this item* is expected to decline by $4.0 million in 1977-78 to $3.9 million. It is expected that all final claims from the States will be processed by the end of 1977-78. {:#subdebate-68-49} #### Dental Services for School Children The Commonwealth is establishing, in co-operation with the States, an Australia-wide school dental scheme to provide a free dental service to all primary school children. The children receive comprehensive dental care at local clinics at regular intervals by either a dentist or dental therapist, with an emphasis on prevention and dental health education. As previously announced, the Commonwealth will meet, from 1 July 1977, 75 per cent of the capital cost of new training facilities and clinics (previously 90 per cent). The previous capital subsidy of 90 per cent will apply to projects not completed by 30 June 1977. Also from 1 July 1977 the Commonwealth will meet 75 per cent of the operating costs of training facilities (previously 90 per cent) and 50 per cent of operating costs of clinics (previously 65 per cent). Expenditure on the scheme under the revised funding arrangements is estimated to increase by $1.9 million, in 1977-78, to $24.6 million. Health Services in the Territories nec In the Australian Capital Territory and the Northern Territory the Commonwealth provides health services of the type provided elsewhere by State and local government authorities. These services include hospitals, public health activities, ambulance services and community health centres. The Capital Territory Health Commission operates two hospitals in the Australian Capital Territory and the Department of Health operates five hospitals and a leprosarium in the Northern Territory. Charges were levied on patients in A.C.T. mental health hostels from 5 July 1977 (estimated receipts in 1977-78 are $81 200). Construction and equipping of Calvary Hospital, a central hospital services complex and a central administration building, account for the major part of capital outlays in the Capital Territory. The major projects in the Northern Territory in 1977-78 are the construction of a hospital and central pathology laboratory in Darwin, a health centre at Howard Springs and the equipping of hospitals at Tennant Creek, Alice Springs and Darwin. Reflecting the completion of some major works and allowing for 50 per cent of net operating costs of the recognised hospitals being met by Medibank, net expenditure on health services in the Territories is estimated to increase by $0.3 million in 1977-78 to $107.1 million. {:#subdebate-68-50} #### Health Services for Aboriginals Expenditure under this heading includes direct expenditure by the Commonwealth ($9.1 million in 1977-78) and grants to the States ($12.6 million). The expenditures provide hospital facilities, clinics, health centres and doctors and nurses in areas of high Aboriginal population. Provision is also made for health education and preventive medicine projects. {:#subdebate-68-51} #### Other Health Services {:#subdebate-68-52} #### Medical Research Grants Through the Medical Research Endowment Fund and on the advice of the National Health and Medical Research Council, the Commonwealth Government assists the medical research activities of Commonwealth and State Government departments, universities and other institutions and individual research workers, and with the training of medical research workers. An amount of $10.2 million was provided for this purpose in 1976-77. $11.7 million is 'being provided in support of medical research programs in 1977-78, including $0.37 million for the Howard Florey Institute of Experimental Physiology and Medicine and $0.5 million for the Walter and Eliza Hall Institute of Medical Research . {:#subdebate-68-53} #### Commonwealth Serum Laboratories Commission The Commonwealth Serum Laboratories Commission produces and sells biological products, undertakes research into the production of therapeutic biological products, and maintains stocks of biological products. The provision of $9.3 million for 1977-78 is $3.5 million more than expenditure in 1976-77. {:#subdebate-68-54} #### Aids and Appliances The Commonwealth meets the cost of supplying hearing aids (and batteries) to children, eligible pensioners and their dependants; artificial limbs to civilians; stoma appliances and, up to 30 September 1976, home dialysis equipment (and supplies) to members of the community who need them. From 1 October 1976 costs incurred in relation to home dialysis have been shared by the States and the Commonwealth under Medibank hospital arrangements. Reflecting 'this change, expenditure is expected to decline from $5.3 million in 1976-77 to $4.4 million in 1977-78. {:#subdebate-68-55} #### Educational Campaigns Funds have been provided to support State and national projects of education directed against the abuse of narcotics and other drugs of addiction since 1970-71. $0,825 million has been allocated to the National Drug Education Program in 1977-78; this allocation is subject to an assessment of the effectiveness of programs currently in operation. {:#subdebate-68-56} #### Blood Transfusion Service and Products The annual operating costs of the Red Cross Society's Blood Transfusion Service in the States are shared by the States (60 per cent), the Society (the lower of 5 per cent of operating costs or 10 per cent of its previous year's income from donations) and the Commonwealth (the balance) and in the Territories by the Society and the Commonwealth in accordance with a similar principle. Blood collected by the Society's Transfusion Service is processed into blood fractions, plasma and serum by the Commonwealth Serum Laboratories Commission. The blood products are supplied, free of charge, to hospitals and approved pathologists for use in medical diagnosis and treatment. The Commonwealth reimburses the Commission for the cost of processing the blood. The Commonwealth's contributions are estimated to increase by $2.0 million in 1977-78 to $9.4 million. {:#subdebate-68-57} #### Quarantine Services Human, animal and plant quarantine measures are enforced to prevent the introduction of exotic diseases into Australia. By arrangement, the States administer animal and plant quarantine and have their costs reimbursed by the Commonwealth. Human quarantine is administered by the Commonwealth. As part of a proposal for upgraded facilities for the isolation and treatment of new types of human quarantineable diseases, the Commonwealth proposes to meet the costs in 1977-78, estimated to be $0.91 million, of constructing a national high security quarantine unit at the Fairfield Infectious Diseases Hospital in Victoria. The Government has also decided to re-introduce vaccination fees from 1 September 1977; this is expected to result in revenue of $2.5 million in 1977-78. Net outlays for quarantine services are estimated to increase from $8.3 million in 1976-77 to $8.7 million in 1977-78. Included in this amount is a provision of *$0.8 million for the* incineration of quarantineable wastes at international airports, for which financial and operational responsibility was transferred from the Department of Transport to the Department of Health from 1 July 1977. {:#subdebate-68-58} #### Other Included here are the Commonwealth subsidy of $2.4 million to the Royal Flying Doctor Service, grants to the States for the Australian Encephalitis Eradication Campaign, reimbursement to the Australian Medical Association of expenses incurred in examining a system of peer review of medical professional standards, and expenditure related to the administration of public health and the Therapeutic Goods Act. {:#subdebate-68-59} #### General Administration This item comprises the general administrative and capital expenses of the Health Insurance Commission (other than its Medibank Private function) ($54.8 million), the Hospitals and Health Services Commission ($0.2 million) and the bulk of the Department of Health. Expenditure is estimated to increase from $87.0 million in 1976-77 to $92.1 million in 1977-78, reflecting the full-year effect of salary and other cost increases in 1976-77 and an increase in expenditure of a capital nature. {:#subdebate-68-60} #### Recoveries Recoveries are accounted for mainly by charges met by certain countries for treatment given to their ex-servicemen through Repatriation facilities. {: type="1" start="4"} 0. SOCIAL SECURITY AND WELFARE The Australian social security system is intended to protect people from economic hardship caused by events such as loss of earnings through age, invalidity, sickness, unemployment or the loss or absence of a supporting spouse as a result of death, desertion or long-term separation. It is designed also to compensate ex-servicemen for war-caused disabilities and the dependants of those whose deaths are war-related and to assist parents with the expenses associated with bearing and raising children. Much of this assistance is provided by way of cash benefits. There are selective, or means-tested, benefits such as invalid and widows' pensions and unemployment benefits, as well as universal benefits such as maternity allowances and family allowances. Additionally, assistance is provided, either directly or through State and local government authorities and voluntary agencies, for a wide range of welfare services for people with special needs. The aged, for example, are assisted with their accommodation needs and invalids may be trained so that they can re-enter paid employment. Assistance is provided in a variety of forms for the advancement of Aboriginals. Total direct outlays on social security and welfare are estimated to increase from $6430.7 million in 1976-77 to $7247.9 million in 1977-78, an increase of 12.7 per cent. Direct outlays on social security and welfare in 1977-78 are equivalent to 27.2 per cent of estimated total Budget outlays. The Government is continuing to review the income security system in Australia. This review will include consideration of the final reports from the Commission of Inquiry into Poverty, the National Superannuation Committee of Inquiry and the Independent Inquiry into the Repatriation System. As announced by the Minister for Social Security an overall review of the Department of Social Security is being carried out with a view to implementing improvements in the Department's present systems and procedures, including those for reviewing entitlements and processing claims. Although expected savings from the review are only fractional in relation to total outlays under the Social Security and Welfare heading, they are significant in absolute terms - savings of the order of $50 million are estimated in 1977-78. Figures for actual outlays on social security and welfare in 1975-76 and 1976-77 and estimated outlays in 1977-78 are shown in the following table: Assistance for the Aged {:#subdebate-68-61} #### Pensions and Allowances Age pensions are payable, free of income test, to residentially qualified men and women aged 70 years or more or to persons of age pension age who are permanently blind. Age pensions are payable, subject to an income test, to residentially qualified women aged 60to 69 years and to residentiary qualified men aged 65 to 69 years. To be residentially qualified for age pension, a period of ten years continuous residence in Australia is usually necessary. Wife's pension is payable to an age pensioner's wife who does not qualify for an age, invalid or repatriation service pension in her own right. The pension is subject to an income test. Additional payments of$7.50 a week for each child are available to pensioners with dependent children. These payments are subject to an income test. Supplementary assistance of up to $5 a week is payable, subject to a special income test, to pensioners who pay rent or lodging charges. Generally the amount of supplementary assistance payable is not to exceed the actual amount paid for rent or lodgings. Upon the death of one of a married pensioner couple, the surviving member becomes entitled to receive, for up to six fortnightly instalments, the equivalent of the two pensions that would have been paid had the spouse not died. The levels of the relevant pensions and benefits are adjusted automatically for movements in the Consumer Price Index (CPI). Levels will be adjusted in November 1977 and May 1978 by the percentage increase in the CPI between the December quarter 1976 and the June quarter 1977 and between the June and December quarters 1977 respectively. The existing maximum rates of pensions and additional payments and the rates to come into force as from November 1977 are set out below. The estimated cost of the two proposed increases in the rates of age pensions is $114.1 million in 1977-78 and $307.0 million in a full year. At 30 June 1977 there were 1,231,000 age pensioners (including wives of age pensioners in receipt of a wife's pension) and during 1977-78 the number is estimated to increase by 32 000 to 1 263 000. In addition, approximately 19 000 invalid pensioners of age pension age will be transferred to age pension during the year. The average amount of age pension (including additions for children and supplementary assistance) is estimated to rise from $39.50 a week in 1976-77 to $44.80 a week in 1977-78, an increase of 13.4 per cent. The main reasons for this are the increases in pension rates in line with the CPI and the full-year effects of increased rates of pension introduced during 1976-77. {:#subdebate-68-62} #### Aged Persons Accommodation The Government has approved a three-year program to subsidise the provision of aged persons' accommodation under the Aged or Disabled Persons Homes Act and the Aged Persons Hostels Act - $42.4 million was spent under the two Acts in 1976-77. An amount of $50 million is included in the Budget for expenditure on aged persons homes and hostels in 1977-78; S7.6 million more than in 1976-77. An announcement concerning this program will be made by the Minister for Social Security. Under the *Aged and Disabled Persons Homes Act* 1954 organisations are assisted to provide suitable homes in which aged people may live in conditions approaching ordinary domestic life. Grants on a $2 for $1 basis may be made to religious and charitable organisations and local government bodies to meet the cost of erection, extension or purchase of homes for the aged. The maximum subsidy limits under the Act are SI 1 130 for a single unit and S 12 910 for a double unit, plus a maximum of $1920 a unit for land. Handicapped adults may also be accommodated in subsidised homes. Expenditure on the provision of homes is estimated at S21.5 million in 1977-78. The *Aged Persons Hostels Act* 1972 is designed to encourage the provision of hostel accommodation for the aged. Subject to certain conditions, the Commonwealth meets the cost of providing additional hostel accommodation by eligible organisations up to a maximum of $16 700 a person. The Commonwealth also pays an additional grant of up to $2400 a person for the purchase of land; a further $250 a- person is- available for furnishings. Accommodation provided under the Act must be allocated strictly on the basis of need and without any contribution from the prospective resident. Expenditure under the Act is estimated at $28.5 million in 1977-78. Under the *Aged or Disabled Persons Homes Act* 1954 the Commonwealth also pays a personal care subsidy of $15 a week to eligible organisations for persons aged 80 years or over and other residents who require, and are receiving, approved personal care while living in hostel-type accommodation provided by those organisations. Expenditure on the personal care subsidy is estimated to rise from $11.1 million in 1976-77 to $13.4 million in 1977-78 as a result of an expected increase in the number of persons who will qualify for the subsidy. The *States Grants (Dwellings for Pensioners) Act* 1974 is designed to assist the States with the provision of self-contained dwelling units at reasonable rentals for single age, invalid, Class B widow and certain single repatriation pensioners, who have little or no means apart from their pension. The Act was amended in 1977 to provide an additional $10 million in grants and to extend its operation for one year to 30 June 1978 pending completion of the review of the Government's policy towards care of the aged. The grants are allocated among the States in proportion to the total number of age, invalid and Class B widow pensioners in receipt of supplementary assistance in each State. Rents of units provided under the scheme are not less than the maximum rate of supplementary assistance paid to pensioners. Of the $40 million provided for under the Act, $30 million had been spent to 30 June 1977 including $10.8 million in 1976-77; the States are to receive the remaining $10 million in 1977-78. {:#subdebate-68-63} #### Home Care Services Under the *States Grants (Home Care) Act* 1969, and the *States Grants (Paramedical Services) Act* 1969, the Commonwealth provides funds, in association with the States, for the provision of a range of home care services, mainly for aged persons and for the provision of senior citizens centres. Under the *States Grants (Home Care) Act* 1969, the Commonwealth shares on a $2 for $1 basis with the States the cost of approved housekeeping or other domestic assistance provided wholly or mainly for aged persons in their homes. Grants are estimated to rise to $9.3 million in 1977-78, $2.4 million more than in 1976-77, because of the expansion of existing services. The Commonwealth also shares, on a $2 for $1 basis with the States, up to a maximum of two-thirds of the capital cost of approved senior citizens centres and the cost of the salary of a welfare officer employed in conjunction with such a centre The Government has agreed to a three-year funding program for senior citizens centres with $4 million being provided in each of the three years. 1977-78 will be the second year of the program. Grants towards the cost of the salary of a welfare officer employed in conjunction with a senior citizens centre are estimated to amount to $0.9 million in 1977-78, $0.2 million more than in 1976-77. Under the *States Grants (Paramedical Services) Act* 1969, the Commonwealth shares, on a $1 for $1 basis with the States, the cost of approved paramedical services provided wholly or mainly for aged persons in their homes. Grants in 1977-78 are estimated at almost $0.5 million. The *Delivered Meals Subsidy Act* 1970 is designed to assist the establishment, expansion, improvement or maintenance of approved meals-on-wheels services. The basic rate of subsidy is 25 cents a meal. An additional subsidy of 5 cents a meal is payable if the organisation undertakes to include with each meal approved kinds and quantities of fresh fruit or fruit juices. Expenditure under the Act in 1977-78 is estimated at $2.2 million, compared with $1.9 million in 1976-77, as a result of an expected rise in the number of meals supplied by existing services. {:#subdebate-68-64} #### Assistance to Ex-Servicemen and Their Dependants {:#subdebate-68-65} #### Disability Pensions and Allowances Disability pensions and allowances (and certain other benefits including medical treatment) are available to certain veterans and their dependants. The term 'veteran' includes any man or woman eligible for consideration under the *Repatriation Act* 1920 or associated Acts by virtue of service in the Australian armed forces. The term 'service' includes service in the 1914-18 War, the 1939-45 War, the Korea-Malaya Operations, the Far East Strategic Reserve, special service in South-East Asia (including Vietnam), and service with the Defence Force on or after 7 December 1972. Basic eligibility varies according to the nature of service. Broadly, for those with 'active service' incapacity or death resulting from 'any occurrence' during service may be accepted. For those with 'home service', however, the criterion is narrower, in that incapacity or death must have arisen out of, or be attributable to, that service; incapacity or death arising from a condition existing prior to enlistment may be accepted if aggravated or contributed to by the conditions of service. {:#subdebate-68-66} #### Classes of Disability Pensions Pensions are paid to eligible veterans in three main categories: o The Special Rate (known as the T & PI) Pension, payable to a veteran who, as a result of service, is blinded, or is totally and permanently incapacitated so that he is unable to earn more than a negligible percentage of a living wage; o The Intermediate Rate, payable to a veteran who, because of the severity of his incapacity accepted as related to service, can work only part-time or intermittently, and in consequence is unable to earn a living wage; and e The General Rate, payable to a veteran who has an incapacity accepted as related to service, but who is still able to work full-time although under difficulty. The amounts payable range from 10 per cent to 100 per cent of the maximum General Rate, according to the assessed degree of incapacity. Pensions are also paid to the wives of incapacitated veterans and to their children. Such pensions are paid at rates varying with the assessed degree of the particular veteran's incapacity. When the death of a veteran has been accepted as related to his service, his widow qualifies for the war widow's rate of pension and for associated benefits, while his children each receive pensions at 'orphan' rates and other benefits. If a veteran's death has not been accepted as related to service, but at the time of death he was receiving, or is later adjudged to have been eligible to receive, a pension at the Special Rate or as a double amputee, his dependants qualify for pensions as if his death had been accepted as related to service. Other dependants of deceased veterans may qualify for pensions in certain cases. {:#subdebate-68-67} #### Allowances Various allowances are provided to supplement disability pensions. These allowances vary according to the type or severity of disablement and the special needs of the pensioners. {:#subdebate-68-68} #### Rates of Pensions and Allowances The Special, Intermediate and General Rate disability pensions and the war and defence widow pensions are automatically adjusted each Spring and Autumn in line with movements in the Consumer Price Index. The existing and proposed rates of the main disability pensions and allowances are set out below. The Sustenance Allowance is to be replaced by a Loss of Earnings Allowance which will be available on a similar basis to that presently payable to veterans in respect of their attendance before Appeal Tribunals. The Government has also decided to remove from the Repatriation legislation the provision for the automatic acceptance of pulmonary tuberculosis as a basis for disability pension and the guaranteed minimum pension rate of 100 per cent payable in respect of it. The Minister for Veterans' Affairs will be announcing details of these two changes. The proposed increases in the rates of disability pensions in November 1977 and May 1978 are estimated to cost $9.2 million in 1977-78 and $22.3 million in a full year. During 1976-77 the average number of veterans and their dependants in receipt of disability pensions was 489 000; in 1977-78 the number is estimated to be 471 000. The effect on expenditure of this estimated decline in numbers is more than offset by the full year effects of increased rates of benefits introduced in 1976-77 and the increases in benefit rates in line with movements in the CPI during 1977-78. {:#subdebate-68-69} #### Service Pensions Service pensions may be payable to: o a male veteran who served in a theatre of war and who has attained the age of 60 years or is permanently unemployable; o a female veteran who served in a theatre of war or embarked for service abroad and has attained the age of 55 years or is permanently unemployable; o ex-members of the Defence Forces of British Commonwealth countries who served in a theatre of war and have had at least ten yean residence in Australia; and o a veteran suffering from pulmonary tuberculosis irrespective of age or the area of service. As with disability pensions, legislation will also be introduced to remove pulmonary tuberculosis as a basis for the grant of service pension. Those veterans currently receiving Service Pension for this reason will, however, continue to do so. Service in a 'theatre of war' means, in respect of the 1914-18 War or 1939-45 War, service 'at sea, in the field or in the air in naval, military or aerial operations against the enemy in an area, or on an aircraft or ship of war, at a time when danger from hostile forces of the enemy was incurred in that area or on that aircraft or ship of war . . .' In respect of certain later service, 'service in an operational area', and 'special service' as defined are the qualifications equivalent to service in a 'theatre of war'. A service pension is the broad equivalent of an age or invalid pension. The advantages to the veteran are availability of the service pension five years earlier and, in certain circumstances, eligibility for a wide range of repatriation medical treatment services. Service pensioners are eligible for the same range of pensions and allowances as age pensioners and the rates of benefits are the same. Like age pensions, service pensions will be increased in November 1977 and May 1978 in line with movements in the Consumer Price Index. Service pensions are paid, free of income test, to eligible veterans aged 70 years and over. For eligible veterans under 70 years of age, 50 per cent of any disability pension received is disregarded as income for service pension income test purposes. With this exception service pensions are subject to the same income test arrangements as social security pensions. During 1976-77 the average number of service pensioners (including "wives) was 151 200; this number is estimated to rise to 171 100 in 1977-78. Increased expenditure in 1977-78 reflects this increase in numbers, the full-year effect of pension increases granted in 1976-77, and the increased rates to apply in 1977-78. The proposed two increases in the rates of service pensions are estimated to cost SI 6.1 million in 1 977- 78 and $39.2 million in a full year. Assistance to the Handicapped {:#subdebate-68-70} #### Invalid Pensions and Allowances Invalid pensions are payable to persons not less than 16 years of age who are permanently incapacitated for work to the extent of at least 85 per cent, or permanently blind. Pensions are subject to an income test except in the case of people who are permanently blind. If the incapacity or blindness occurred outside Australia, the residence qualification is the same as for an age pension. Invalid pensioners are eligible for the same additional payments as age pensioners and the rates of payment are the same. Similarly, wife's pension is payable, subject to income test, to the wife of an invalid pensioner if she is not eligible for an age, invalid or service pension in her own right. At 30 June 1977 there were 246 000 invalid pensioners (including wives of invalid pensioners in receipt of wife's pension) and during 1977-78 the number is estimated to increase by 13 000 to 259 000. However, this number includes approximately 19 000 pensioners of age pension age who will be transferred to age pensions during the year. The average amount of invalid pension (including additions for children and supplementary assistance) is estimated to rise from $41.00 a week in 1976-77 to $46.30 a week in 1977-78, an increase of 12.9 per cent. The main reasons for this are the proposed increases in pension rates in line with the Consumer Price Index and the full-year effects of increased rates of pension introduced during 1976-77. The estimated cost of the increases in rates of invalid pension in November 1977 and May 1978 is $20.9 million in 1977-78 and $56.1 million in a full year. {:#subdebate-68-71} #### Sheltered Employment Allowances Sheltered employment allowances are payable to disabled people engaged in approved sheltered employment who are qualified to receive an invalid pension or who would become so qualified if they ceased to be provided with sheltered employment. The allowance is subject to the same income test as applies to the invalid pension and the rates of payment are generally the same. An incentive allowance of $5 a week is paid (free of income test) to the recipients of sheltered employment allowance. Recipients of the sheltered employment allowance are not eligible for supplementary assistance. {:#subdebate-68-72} #### Handicapped Child's Allowance *A* handicapped child's allowance of $15 a week is payable to parents or guardians in respect of a child under the age of 16 years who is cared for at home and who, because of the severity of the handicap, is in need of constant care and attention. The Government has decided to amend the Social Services Act to give the DirectorGeneral a discretion to approve the grant of a handicapped child's allowance, wholly or in part, where a person has the custody, care and control of a substantially handicapped child and, as a consequence of continuing substantive expenditure associated with the child's disability, the person suffers financial hardship. The number of recipients at 30 June 1977 was 22 000 and this number is expected to increase to 24 000 by 30 June 1978. Expenditure is estimated to rise from $10.9 million in 1976-77 to $18 million in 1977-78 as a result of the increased numbers expected to qualify for the allowance and the full-year effect of the increased rate of allowance announced in the 1 976-77 Budget. {:#subdebate-68-73} #### Handicapped Persons Facilities Under the *Handicapped Persons Assistance Act* 1974 the Commonwealth provides subsidies on a $4 for $1 basis to non-profit organisations and local governing bodies for the purchase, construction, extension, alteration, rental and maintenance of premises that cater for physically and mentally handicapped people. Buildings qualifying for subsidy comprise day training centres for handicapped children, activity therapy centres and sheltered workshops for handicapped adults and residential projects for people who attend these establishments. Residential projects for people who, because of a disability, need special accommodation to allow them to engage in normal outside employment also qualify for subsidy. Subsidies on a $4 for $1 basis are available also for the cost of furnishing and equipping the various types of centres, while assistance with operating costs may be provided by means of staff salary subsidies. The latter are usually on a $1 for $1 basis although a higher proportion, up to 100 per cent, may be paid for the first two years of operation of some new projects. A training fee of $500 is paid to eligible sheltered workshops for each former employee who, after completing more than six months sheltered employment, graduates to and retains employment for 12 months or more. The Commonwealth has introduced a three-year program of assistance under the Act. $30 million was spent in 1976-77 and $39 million will be provided in 1977-78, rising to $52 million in 1978-79. The Commonwealth pays a handicapped children's benefit of $5.00 a day, for each child under 16 years of age, to charitable and religious organisations conducting approved homes providing accommodation and care for mentally and physically handicapped children. The benefit continues to be paid to an eligible organisation when a child is absent from the institution for a short period only such as a week-end home visit. Expenditure is estimated to increase from $1.6 million in 1976-77 to $2.3 million in 1977-78 due to an expected increase in the number of organisations becoming eligible for subsidy and the full year effect of increased rates introduced in the 1976-77 Budget. {:#subdebate-68-74} #### Rehabilitation Services The Commonwealth Rehabilitation Service attempts to restore disabled people to their fullest physical, mental, social and vocational usefulness. Treatment and training are provided free to persons in the following categories if there is a reasonable prospect of their engaging in gainful employment: o invalid pensioners; o widow pensioners and supporting mother beneficiaries (other than those eligible under the National Employment and Training System) ; o recipients of unemployment, sickness or special benefits; o former national and regular servicemen who are disabled at time of discharge but are ineligible for rehabilitation assistance from the Department of Veterans' Affairs; o persons receiving a tuberculosis allowance; o persons who become disabled while working for the Commonwealth Government and who are covered by the Compensation (Australian Government Employees) Act; and o boys and girls of 14 and 15 years who would otherwise be likely to qualify for an invalid pension at 16. The Commonwealth has decided to make the service available, free of charge, to certain mentally and physically handicapped persons within the broad working age group who are not presently eligible without charge under the existing legislation because there is little prospect of their engaging in gainful employment. Expenditure is estimated to rise from $13.1 million in 1976-77 to $16.9 million in 1977-78 as a result of an expected increase in the numbers to be accepted for treatment and training and the full year effect of price and salary increases during 1976-77. The Commonwealth and Tasmanian Governments have agreed to share the costs of establishing and operating a joint rehabilitation centre for handicapped persons in Hobart. The Commonwealth meets up to half the capital cost of the Centre. Its contribution is estimated at $1.2 million in 1977-78 as compared to $0.4 million in 1976-77. {:#subdebate-68-75} #### Assistance to Widows and Supporting Mothers {:#subdebate-68-76} #### Widows' Pensions and Allowances Pensions are payable to widows subject to an income test. No period of residence is necessary if a woman .and her husband were residing permanently in Australia when she became a widow. In other cases, there is a residence qualification of either 5 years immediately prior to claiming a pension or 10 years continuous residence in Australia at any time. There are three classes of widow's pension: Class A - A widow with one or more qualifying children in her care. Class B - A widow without qualifying children who is at least 50 years of age or at least 45 years of age if her Class A pension ceased after she reached that age because she no longer had a qualifying child in her care. Class C - A widow without qualifying children who is in necessitous circumstances within 26 weeks of her husband's death. For all classes, the term 'widow' includes a woman who was the common-law wife of a man for at least three years immediately before his death. For Class A and B, it includes a wife who has been deserted for six months, a divorcee, a woman whose husband has been imprisoned for six months and a woman whose husband is in a mental hospital. Widow pensioners may be eligible for supplementary assistance, additional pension for dependent children and mother's allowance (in lieu of guardian's allowance) at the same rates as age and invalid pensioners. These payments are subject to an income test. At 30 June 1977 there were 139 000 widow pensioners and during 1977-78 the number is estimated to increase by 8000 to 147 000. The average rate of pension (including additions for children and supplementary assistance) is estimated to rise from S51.90 a week in 1976-77 to $57.70 a week in 1977-78, an increase of 11.2 per cent. The estimated cost of the increases in the rates of widows' pensions in November 1977 and May 1978 is $13.8 million in 1976-77 and S37.0 million in a full year. {:#subdebate-68-77} #### Supporting Mothers' Benefits and Allowances A supporting mother's benefit is paid to unmarried mothers and mothers who are deserted de facto wives, de facto wives of prisoners and separated wives. The benefit becomes payable six months after the date of the event which gives rise to eligibility (e.g., the birth of a child or separation), and it is payable at the same rate and subject to similar conditions as the Class A widow's pension. Supporting mothers may also be eligible for supplementary assistance, additional benefit for dependent children and mother's allowance. At 30 June 1977, there were 51 000 supporting mother beneficiaries and during 1 977-78 the number is estimated to increase by 6000 to 57 000. The average rate of benefit (including additions for children and supplementary assistance) is estimated to rise from $61.30 a week in 1976-77 to $67.10 a week in 1977-78, an increase of 9.5 per cent. The estimated cost of the increases in the rates of supporting mother's benefit in November 1977 and May 1978 is $5.2 million in 1977-78 and S14.1 million in a full year. {:#subdebate-68-78} #### Other Under the *States Grants (Deserted Wives) Act* 1968 the Commonwealth shares, within limits, on a $1 for $1 basis with the States the cost of helping certain mothers of families without a breadwinner where the mothers are ineligible for a Class A widow's pension or a supporting mother's benefit. Assistance is provided during the first six months after the date of the event which gives rise to eligibility (e.g., the birth of a child or separation). The main groups of mothers assisted are deserted wives, deserting wives, wives of prisoners and unmarried mothers. After the first six months, these groups of mothers may qualify for either a Class A widow's pension or a supporting mother's benefit. Expenditure is estimated to rise from $13.3 million in 1976-77 to $15.5 million in 1977-78 due to a small expected increase in numbers and the full year effect of rate increases during 1976-77. {:#subdebate-68-79} #### Assistance to Families {:#subdebate-68-80} #### Family Allowances Family allowances are payable to people with children under 16 years of age or 16 years but under 25 years of age and receiving full-time education at a school, college or university and not in employment. There is no income test. Allowances are usually paid to the mother. Special conditions apply if the person does not intend to reside permanently in Australia. The rates of family allowances are: At 30 June 1977, there were 4 302 000 children (including student children and children in institutions) covered by the allowances and the number is estimated to increase to 4 310 000 by 30 June 1978. Outlays are estimated to increase from $1027.2 million in 1976-77 to $1049 million in 1977-78 due to an expected increase in the numbers becoming eligible and altered payment procedures. {:#subdebate-68-81} #### Maternity Allowance Maternity allowance is payable, as a lump sum, to mothers on the birth of children. There is no income test. A woman is entitled to the allowance if she resides, or intends to reside, in Australia permanently and gives birth to a child here or on board a ship travelling to Australia. The rates of allowance are as follows: During 1977-78 the number of grants is estimated at 219 000 compared to 220 000 in 1976-77. Expenditure is estimated to remain steady at S6.9 million. {:#subdebate-68-82} #### Children's Services The Commonwealth provides capital and recurrent assistance for pre-school and child care projects including home care, vacation and after-school care projects. Assistance is provided through the State Governments and directly to organisations concerned with pre-school and child care activities. Since 1 January 1977, assistance to the States for the recurrent costs of pre-school services has been provided in the form of a block grant, subject to certain broad requirements concerning priority of access. An amount of S39 million will be provided to the States by way of block grants in 1977-78. Total expenditure on children's services is estimated to be $73.3 million in 1977-78 compared to expenditure of $67.1 million in 1976-77. The figure for 1977-78 includes a small amount for new projects. {:#subdebate-68-83} #### Other Grants are made to eligible marriage guidance organisations (estimated at $2.1 million in 1977-78) and for the provision of family planning facilities and the training of medical personnel (estimated at $0.8 million in 1977-78). An orphan's pension of $11 a week is payable free of income test to the guardian of a child under 16 years of age or a full-time student over 16 but under 25 years of age. It is paid in respect of a child both of whose parents are dead or one of whose parents is dead and the whereabouts of the other is unknown, or in respect of a child whose sole surviving parent or adoptive parent is in prison or in a mental hospital. Expenditure is estimated to rise from $1.6 million in 1976-77 to $2.6 million in 1977-78 partly due to an expected increase in the number of claims and a change in method of recording payments of these pensions. Assistance to the Unemployed and Sick {:#subdebate-68-84} #### Unemployment and Sickness Benefits Unemployment and sickness benefits are respectively available, subject to an income test, to people who are unemployed or to people who are temporarily incapacitated for work and have thereby lost income. A special benefit may be paid to a person ineligible for a pension or for an unemployment or sickness benefit if he is unable to earn a sufficient livelihood for himself and his dependants. To be eligible for unemployment or sickness benefit, a person must be at least 16 years of age and under 60 (females) or under 65 years (males). The person must also have lived in Australia for at least a year immediately prior to claiming benefit or intend to remain here permanently. The basic rates of benefit are generally the same as for age and invalid pensions except for single people under 18 years of age. This group is eligible for a maximum payment of $36 a week and the benefit is not subject to the automatic indexation provisions for increases in the Consumer Price Index. Beneficiaries are also eligible for additional benefit for each dependent child. After receiving benefits for six consecutive weeks sickness beneficiaries become eligible, subject to a special income test, to receive supplementary allowance of up to $5.00 a week if they pay rent. This allowance is not payable to beneficiaries in hospital who have no dependants. The cost of the increases in rates of unemployment, sickness and special benefits in November 1977 and May 1978 is estimated to be $27.7 million in 1977-78. The Government has decided to change the present system of paying unemployment benefits two weekly in advance to paying benefits two weekly in arrears. Savings from the move are expected to total about$60 million in 1977-78. Special provision will be made for those who would suffer hardship as a result of the change. {:#subdebate-68-85} #### Unemployment Relief {:#subdebate-68-86} #### Community Youth Support Scheme The Community Youth Support Scheme (CYSS) was introduced on 1 November 1976 to assist young unemployed persons who have registered with the Commonwealth Employment Service. The aim of CYSS is to improve the employability of unemployed youth and to maintain an orientation towards work. Under the Scheme financial assistance is provided to community groups, including recognised youth organisations and local government authorities, to meet the administrative and operating costs of the projects conducted by those bodies to assist the young unemployed. An allowance of up to $6 a week may be paid to participants to meet fares and incidental expenses. Expenditure under CYSS in 1976-77 amounted to $0.6 million; $4.0 million has been provided for 1977-78. {:#subdebate-68-87} #### Fraser Island Following its decision to cease granting export licences for minerals from sand mining on Fraser Island, the Commonwealth agreed to provide $10 million to Queensland for allocation by that State to create employment opportunities in the Maryborough region. $1.0 million was provided in 1976-77 and $3.0 million will be provided in each of the next three years. {:#subdebate-68-88} #### Relocation Assistance Scheme On 1 October 1976 the Government introduced the Relocation Assistance Scheme to help overcome the employment difficulties of unemployed persons who are unable to secure continuing employment in their present locality and are without prospects of doing so, even with re-training. Assistance is made available to enable eligible persons to move to another locality to take up either employment or training under NEAT leading to employment. Financial assistance is provided in relation to fares, removal expenses, re-establishment allowance in a new location, and certain other costs incurred by unemployed workers and their families changing their place of permanent residence. The Scheme is estimated to cost $1.3 million in 1977-78, an increase of $1.0 million on 1976-77. *Regional Employment Development Scheme (REDS)* This scheme was introduced in September 1974 but no new projects have been approved since September 1975. {:#subdebate-68-89} #### Other Welfare Programs {:#subdebate-68-90} #### Funeral Benefits A funeral benefit of up to $20 is payable to any person liable for the funeral costs of an age or invalid pensioner. A higher benefit of up "to $40 is payable to an age, invalid or widow pensioner (including a woman in receipt of supporting mother's benefit) liable for the funeral costs of a spouse, a child or another such pensioner. For these benefits 'pensioner' means a person who satisfies, or had satisfied, the Commonwealth Government pensioner 'fringe' benefits income test. Expenditure is expected to rise from$1. 5 million in 1976-77 to$1. 7 million in 1977-78 as a result of an expected increase in numbers becoming eligible. {:#subdebate-68-91} #### Telephone Rental Concessions *A* reduction of one-third in the basic annual rental for a telephone is available to pensioners and recipients of some other benefits who meet certain requirements including, in most cases, a special income test. Expenditure on concessions to social security and repatriation pensioners is expected to rise from$14.2 million in 1976-77 to $14.8 million in 1977-78 as a result of an expected increase in the number of persons applying for the concession. {:#subdebate-68-92} #### Australian Assistance Plan The Government decided last year that the Australian Assistance Plan would more appropriately be administered and funded at the State or local Government level. An amount of $5.4 million was provided in 1976-77 to phase out the Commonwealth's involvement. {:#subdebate-68-93} #### Assistance to Homeless Men and Women The *Homeless Persons Assistance Act* 1974 provides, over a three-year period, for the payment of capital grants to voluntary agencies and to local authorities for approved projects (such as night shelters, reception centres and hostels) in order to upgrade and replace inadequate existing accommodation and to build new facilities for homeless persons. It also provides payment of a salary subsidy of 50 per cent of the salary of approved staff, an accommodation subsidy of 75 cents a person a day and a meal subsidy of 25 cents a meal in respect of non-resident homeless persons. The program is to be reviewed this financial year. Expenditure in 1977-78 is estimated to be $6.4 million compared to $2.2 million in 1976-77. The increase in the 1977-78 allocation represents the amount required to meet progress payments on capital projects underway in 1976-77. {:#subdebate-68-94} #### Assistance for Migrants The Commonwealth makes grants to the Good Neighbour Council (estimated at $1.4 million in 1977-78) and to community agencies involved in migrant integration activities (estimated at $0.7 million in 1977-78). Expenditure on the Community Interpreter Service is estimated to rise from $0.393 million in 1976-77 to $0.465 million in 1977-78 as a result of increased use of the service and the Government's decision to expand the service to Wollongong in 1977-78. Provision has also been made for the operation, on an experimental basis, of migrant information and resource centres in Sydney and Melbourne. Under arrangements introduced in 1976-77 the Commonwealth, in co-operation with the States, local government bodies and ethnic groups, provides information services and assistance to migrant communities. Aboriginal Advancement Programs nec Expenditure under this heading is estimated at $43.5 million in 1977-78, an increase of $7.9 million over expenditure in 1976-77. This increase mainly reflects larger grants-in-aid for employment ($1.5 million) and for town management and public utilities ($4.2 million). Also provision has been made for costs associated with the establishment of the National Aboriginal Conference. {:#subdebate-68-95} #### General Administrative and Other Expenditure This expenditure comprises the general running and capital expenses of the Departments of Social Security, Veterans' Affairs (except those relating to repatriation institutions) and Aboriginal Affairs. {: type="1" start="5"} 0. HOUSING The Commonwealth finances a range of programs to provide housing and to assist persons to attain the goal of home ownership. Some of these programs take the form of interest subsidies and tax concessions which are not reflected in Budget outlays. Identifiable housing outlays are estimated to total $495.8 million in 1977-78 and include funds for Aboriginal housing, migrant accommodation, housing in the Territories, Defence Service Homes expenditure and assistance to the States for welfare housing. The total is $53 million less than expenditure last year but this is more than fully accounted for by an estimated $65.2 million reduction in estimated outlays classified to Housing in the Territories, which in turn largely reflects the run-down in expenditure on housing by the Darwin Reconstruction Commission and the reclassification of other expenditure on housing in the Northern Territory to General Public Services as part of the $50 million allocation to be made to the N.T. Legislative Assembly in 1977-78. {: type="a" start="a"} 0. The responsibility for this item in the N.T. has been transferred to the N.T. Legislative Assembly. Expenditure is included in the $50 million allocation made to the Assembly and is recorded in the function General Public Services. 1. See paragraph proceeding Table. 2. Administrative expenses for the Defence Service Homes Scheme are included under that heading in the table. Other Administrative expenditures for Housing are not separable from the Department of Environment, Housing and Community Development and are recorded in the function Urban and Regional Development nec and the Environment. {:#subdebate-68-96} #### Advances to States for Housing An amount of $390 million, an increase of $15 million on 1976-77, is to be advanced to the States in 1977-78 for welfare housing purposes under the terms of the 1973-1974 Housing Agreement. These advances, which are repayable at low rates of interest over a 53-year period, are mainly to assist the State housing authorities to provide dwellings for rental or sale on a concessional basis to low income families. Part of the advances is allocated to Home Builders' Accounts to provide low-interest housing loans to prospective home owners who meet specified eligibility conditions. Eligibility for allocation of a State housing authority dwelling, or for a loan from the Home Builders' Account, is determined on the basis of means tests. For allocation of a family dwelling from a State housing authority, average weekly income of the main family breadwinner during the previous six months (excluding overtime and child endowment) must not exceed 85 per cent of the Statistician's latest seasonally adjusted quarterly estimate of average weekly earnings. For a loan from Home Builders' Account funds, income of the main breadwinner must not exceed 95 per cent of average weekly earnings. In cases where the family includes more than two children an additional $2 per week is added to the income limit for each additional child. Sales of State housing authority dwellings are limited to a maximum of 30 per cent of family dwellings completed during the five years commencing 1 January 1974. Sales may be made only to purchasers meeting the means test at the time of sale, and there are restrictions on resale. The maximum interest rate is set at 5.75 per cent. Under recently agreed amendments to the Agreement, Victoria and Tasmania will be allowed to increase the limit on the sale of family dwellings to 50 per cent. In New South Wales and Tasmania, dwellings will be sold for cash at market or replacement value and the present embargo on the use of Home Builders' Account funds for the purchase of housing authority dwellings will be lifted. The 1973-1974 Agreement will expire on 30 June 1978. Arrangements for the provision of Commonwealth assistance to the States for welfare housing after June 1978 are being developed in consultation with the States. Details of the Housing Agreement and of the State by State allocation of the $390 million are presented in the document *Payments to or for the States and Local Government Authorities, 1977-78* published concurrently with the Budget Speech. {:#subdebate-68-97} #### Grants to States for Housing The *States Grants (Housing) Act* 1971 authorises the provision of housing assistance to the States by way of basic grants of $2.75 million a year, payable for a period of 30 years in respect of the States' housing operations in each of the years 1971-72 and 1972-73; $5.5 million will again be paid in 1977-78. The payments are in lieu of an interest concession on funds used by the States for welfare housing in those years. Further details of these arrangements are presented in the document *Payments to or for the States and Local Government Authorities, 1977-78.* {:#subdebate-68-98} #### Home Savings Grants Home Savings Grants are payable to eligible persons to assist with the purchase Or construction of a first home contracted for on or after 1 January 1977, on the basis, of $1 for each $3 of savings held in an acceptable form. Savings from 1 January 1976 are eligible. Grants of up to $667 are payable from 1 January 1977 in respect of savings over at least one year. From 1 January 1978, a maximum grant of $1333 will be payable in respect of savings over two years, but a grant of up to $667 will also be available in respect of savings over at least one year. The maximum grant will be increased on 1 January 1979 to $2000 and will be payable in respect of savings held over a three-year period. An amount of $20 million has been provided in the Budget for grants under this scheme in 1977-78. {:#subdebate-68-99} #### Housing Loans to Savings Banks The *Banks (Housing Loans) Act* 1974 provided for a special appropriation of $150 million to be advanced Co savings banks and certain other banks for the purpose of making additional housing finance available to give a short-term stimulus to activity and employment in the home building industry. Balances outstanding at 30 June 1977 amounted to $85.9 million of which $10.7 million is expected to be repaid in 1977-78. {:#subdebate-68-100} #### Defence Service Homes The Defence Service Homes Corporation was established on 13 December 1976 with responsibility for the administration of the Defence Service Homes Scheme. It replaces the Australian Housing Corporation which was abolished on that date. The Corporation functions within the framework of the Department of Veterans' Affairs, under the *Defence Service Homes Act* 1918. During 1976-77, the Corporation was empowered to continue its operations under the financial arrangements that had applied to the Australian Housing Corporation. From 1 July 1977 its capital programs will be financed through the Defence Service Homes Trust Account while its operating expenses are being provided for within the votes of the Department of Veterans' Affairs. Capital advances of $22.0 million are being provided in 1977-78 for the Trust Account. An estimated $72.6 million, representing mainly repayments of principal by borrowers, will be retained in the Trust Account for relending, making a total of $94.6 million available for Defence Service Homes programs in 1977-78. An application fee of $75 for an initial application for a loan to acquire a home and $50 for an additional loan will be introduced during 1977-78. Separate waiting lists for loans will also be introduced for applicants with war service and for applicants without war service. These lists will be administered to give a measure of preference to applicants with war service and, within each list, to applicants with an assessed urgent housing need. Defence Service Homes estate development and construction activities are to be phased out. Expenditure in 1977-78 will be limited to existing firm commitments. Completed building blocks will be offered to existing applicants at market value and surplus land will be disposed of as circumstances permit. An amount of $15.2 million is being provided in 1977-78 for administrative expenses, including salaries and rent for the Corporation. This compares with $7.9 million provided as an administrative subsidy in 1976-77 under the previous financial arrangements. In that year, however, the Corporation also had available to it a surplus of $4.1 million carried forward from 1975-76 by the Australian Housing Corporation and other income including investment income of $4.5 million, making a total of $16.5 million. The figures include an estimated interest subsidy element in 1977-78 of $24.9 million. In 1976-77 an interest subsidy of $23.1 million was paid to the Corporation. The interest subsidy reflects the extent to which interest charged to borrowers under the Defence Service Homes Scheme falls short of the interest rate payable to the Commonwealth on the Corporation's capital. Repayments to Consolidated Revenue by the Corporation in 1977-78 are estimated at SI 5.7 million, including an amount of S3. 2 million in recoveries. The remaining SI 2.5 million comprises S6.5 million representing the net amount of excess payments accumulated by the Corporation from borrowers under Section 29 (2) of the Act for the period 1 December 1975 to 30 June 1977, and an estimated $6.0 million for excess payments in 1977-78. {:#subdebate-68-101} #### Other General Housing Expenditure - Other Included here are amounts of $5.8 million for caretaking, repairs and maintenance of rental dwellings in the Australian Capital Territory and Northern Territory, $1.0 million to complete the design of the Housing Allowance Voucher Experiment and to commence its implementation in Melbourne late in 1977-78, and $0.5 million to fund a Committee of Inquiry into the cost of housing in Australia. The Committee has been asked to report by 30 June 1978. Housing in the Territories Expenditure under this heading covers the construction of new houses and flats and advances to individuals for the construction of dwellings in the Australian Capital Territory and the Northern Territory. Of the $36.6 million allocated for dwellings to be built for sale or rental in 1977-78, $14.4 million is for the Australian Capital Territory ($22.3 million in 1976-77) and $22.2 million for the Northern Territory ($63.6 million in 1976-77). Of the latter amount, $17.2 million is for dwelling construction by the Darwin Reconstruction Commission. The decrease in funds for the Australian Capital Territory reflects in part a slow-down in the rate of growth in the population of the National Capital while the reduction in the Northern Territory reflects the run-down in the program of the Darwin Reconstruction Commission. Other Gross Advances for Housing include allocations from the Budget, re-cycled funds and estimated proceeds from private borrowings. These are estimated to decrease from $52.9 million in 1976-77 to $34.8 million in 1977-78 but this change is affected by a classification change. Whereas an amount of $21.2 million was advanced to the N.T. Housing Commission from the Budget last year there is no comparable figure in the estimates for 1977-78. Executive responsibility for the Commission was transferred to the N.T. Legislative Assembly on 1 January 1977, and for 1977-78 the amount to be advanced to the Commission will be determined by the Assembly from within the global allocation provided to that body (see Table 9E). An amount of $14.6 million will be available to the A.C.T. Commissioner for Housing for first mortgage lending in 1977-78 ($12.9 million in 1976-77). Of this amount, $6.5 million will be provided in the Budget (the same as in 1976-77) and a borrowing of $4.5 million is proposed to be made by the Commissioner from private sources. The balance of $3.6 million consists of funds recirculated through a Trust Account. This increased sum will help to meet increases in the size of individual loans following the raising of the loan limit from $15 000 to $20 000, effective from 1 July 1977. An amount of $20.3 million is estimated to be available for first mortgage lending by the N.T. Home Finance Trustee. Of this amount, $15.0 million will be provided from the Budget for the concessional loans to eligible Darwin residents to rebuild dwellings destroyed by Cyclone Tracy. Borrowing proceeds to the extent of $5.3 million are to be utilised for the N.T. Home Finance Trustee's non-concessional home financing activities. {:#subdebate-68-102} #### Housing for Aboriginals An allocation of $35.3 million has been provided for special assistance for Aboriginal housing in 1977-78. This allocation, which is $5.6 million below 1976-77 expenditure, reflects a thorough reassessment of the program, leading to increased cost-effectiveness. Estimated outlays include $10.4 million in grants to States and $24.8 million in grants to Aboriginal Housing Associations for the construction and purchase of homes for Aboriginal families. The 1977-78 provision for the Aboriginal Housing and Personal Loans Fund of the Aboriginal Loans Commission is $5 million, compared with $10 million in 1976-77. Following a review of the objectives and priorities of the Aboriginal Hostels program, an amount of $5.3 million is to be paid to Aboriginal Hostels Limited for the provision of hostel accommodation in 1977-78; expenditure in 1976-77 was $3.7 million. {:#subdebate-68-103} #### Other Recoveries and Repayments The main items included here are rents received in respect of Government-owned dwellings in the Territories and payments from the Housing Loans Insurance Corporation. Receipts from rentals in the Northern Territory are estimated to increase from $3.1 million in 1976-77 to $6.0 million in 1977-78. The increase reflects additional rents being charged for dwellings restored to pre-cyclone condition and a proposed increase in the overall level of rentals to apply from September 1977. Revenue from housing rentals in the A.C.T. is estimated to increase from $15.6 million in 1976-77 to $21.0 million; this reflects the full year effect of the rent increase in 1976-77 and a proposed further increase in 1977-78. Receipts from the Housing Loans Insurance Corporation in 1976-77 included $4.5 million from its General Reserve and $0.2 million repayment of the initial advance made to the Corporation on its establishment in 1965. {: type="1" start="6"} 0. URBAN AND REGIONAL DEVELOPMENT NEC AND THE ENVIRONMENT Outlays on activities encompassed under this heading are estimated to decrease from $250.6 million in 1976-77 to $167.9 million in 1977-78. Urban and Regional Development nec This heading brings together outlays of the Commonwealth Government on urban and regional development which are not classified to other functions. These include financial assistance for growth centres and decentralisation, land commissions, urban rehabilitation and expenditure on the physical development of urban centres in the Commonwealth Territories. Initiatives in urban public transport are discussed under Transport and Communication' in the 'Economic Services' block. {:#subdebate-68-104} #### Growth Centres and Decentralisation Assistance An amount of$15.1 million has been included in the Budget for growth centres and for decentralisation assistance. A further$17.5 million is included for capitalised interest on advances in 1977-78 and earlier years for growth centres. The $15.1 million includes $0.8 million - recorded as part of the general administrative expenditure item - for the Commonwealth's one-third contribution to the estimated administrative expenses of the Albury-Wodonga Development Corporation and for the costs associated with the proposed scaling down of the staff of the Corporation. Included in the balance of $14.3 million is $5.1 million for assistance to the States for Albury-Wodonga and $3 million for Bathurst-Orange and Macarthur. Most of the remaining $6.2 million is intended for general decentralisation assistance. {:#subdebate-68-105} #### Urban Rehabilitation In 1974-75 the Commonwealth Government acquired, at a cost of $17.5 million, 700 dwellings on 19 hectares of land at Glebe from the Anglican Church with a view towards rehabilitating the Estate and preserving accommodation for low income families. Expenditure on rehabilitation in 1976-77 amounted to $1.2 million and an amount of $0.8 million has been provided in the Budget for further rehabilitation in 1977-78; $0.7 million is provided for costs associated with the administration and maintenance of the Estate. An amount of $1.2 million is provided to meet the estimated cost in 1977-78 of further acquisition, planning and site development of land in the Woolloomooloo basin of Sydney. This continues the provision of financial assistance to New South Wales, which amounted to $5.8 million in 1975-76 and $3.0 million in 1976-77, under an agreement concluded with the State in 1974-75. The site is to be developed mainly for residential purposes. In addition to the provision of this financial assistance, the Commonwealth agreed to transfer to New South Wales, at no charge, land which was valued in excess of $11 million. Such transactions, by their nature, are not shown in the Commonwealth's expenditure estimates. {:#subdebate-68-106} #### Urban Flood Mitigation The Commonwealth Government has undertaken to provide 40 per cent of the cost of flood mitigation works on Breakfast Creek and Enoggera Creek in Brisbane. An amount of $1.8 million is provided to allow completion of the project in 1977-78; this takes total Commonwealth contributions in respect of these works to over $5 million. {:#subdebate-68-107} #### Area Improvement Program The Area Improvement Program was established in 1973-74 with a view to helping to remedy deficiencies of public facilities in certain locations. Expenditure amounted to only $0.6 million in 1976-77 to discharge commitments and no funds will be made available in 1977-78; the purposes of the Program are now effectively provided for in new tax sharing arrangements with local government which provide substantially increased levels of untied general purpose assistance to local government. {:#subdebate-68-108} #### Land Commissions/ Urban Land Councils An amount of $14.1 million is provided in the Budget for 1977-78 to meet remaining commitments to the States for land commissions/ urban land councils. A further $12.7 million is entailed in the form of capitalisation of interest payments on loans provided to the States in 1 977-78 and previous years. The assistance provided for land commissions/urban land councils is for land acquisition and servicing of the land acquired (where these costs are not met from normal government subventions) and urban renewal and redevelopment. The main aims of the program have been to make land available for residential and associated uses at fair prices, and to facilitate the efficient planning and development of new urban areas. Following the review of the Commonwealth's involvement in urban land development programs in 1976-77, the Commonwealth has, with the co-operation of the States, established an independent national inquiry into housing costs to prepare a report on the means available to improve the efficiency and to lower the cost of the supply of housing, and the provision of infrastructure services within existing national resources. {:#subdebate-68-109} #### Other Urban Development and Amenities This heading covers a number of items associated mainly with the development of urban land and community facilities in the Commonwealth Territories. The major item included in the total of $41.0 million is $33.9 million for land and community development in the Australian Capital Territory. The reduction of $6.3 million from the level of expenditure in 1976-77 largely reflects the decreased level of land development in Canberra because of the slow-down in the city's rate of growth. {:#subdebate-68-110} #### Development of Aboriginal Community Amenities Expenditure in 1977-78 on the provision and improvement of facilities in Aboriginal Communities, including land purchase, water supply, sewerage and other services is estimated at $8.3 million, $0.6 million more than actual expenditure in 1976-77. Protection of the Environment The main provisions for 1977-78 comprise assistance to New South Wales to complete the capital program associated with the abatement of pollution at the Captains Flat mine dumps ($0,225 million), expenditure on air monitoring activity ($0,285 million) and grants to conservation bodies ($0.3 million). {:#subdebate-68-111} #### Sewerage and Garbage The Budget provides a net $20.2 million for this purpose in 1977-78 compared with expenditure of $83.1 million in 1976-77. The decrease reflects mainly the Commonwealth's decision to discontinue assistance to the States for sewerage works. An amount of $0.3 million will, however, be made available to the States to allow the completion of a number of studies relevant to the rationalisation of the provision of sewerage services. In the Territories $5.4 million is provided in 1977-78 for the reconstruction and augmentation of the Darwin water and sewerage service, and a further $14.8 million for sewerage and waste disposal in the Australian Capital Territory. Of this latter provision $10.3 million is allocated for the Lower Molonglo Water Quality Control Centre. {:#subdebate-68-112} #### General Administrative Expenditure This item includes the administrative expenditure of the Department of Environment, Housing and Community Development (SI 2.9 million), the Darwin Reconstruction Commission (S0.9 million) and the National Capital Development Commission ($8.2 million). It also includes SI 1.8 million for private consultant fees for investigation, design and supervision for the National Capital Development Commission. As indicated earlier the estimate for 1977-78 also includes S0.3 million in respect of the Commonwealth's one-third contribution to the estimated administrative expenses of the Albury-Wodonga Development Corporation and S0.5 million for the Corporation to meet costs associated with the proposed reduction in the number of Corporation staff. The levelling off in this expenditure reflects reductions in staff numbers and administrative expenditures generally, consistent with the Commonwealth's policy of reducing its involvement in the area of urban and regional development. {: type="1" start="7"} 0. CULTURE AND RECREATION The Commonwealth provides support for a wide range of cultural and recreational activities. Outlays in 1977-78 are estimated at S260.9 million, an increase of $3.5 million compared with 1976-77. {:#subdebate-68-113} #### National Broadcasting and Television Service The programs of the National Broadcasting and Television Service are presented by the Australian Broadcasting Commission (ABC) and broadcast through transmitters provided and operated by the Australian Telecommunications Commission (ATC). The net allocation of $163.5 million for 1977-78 provides for the continuation of the operational activity of the Service at about the existing level; it also provides $13.2 million for capital development, including a small amount for further expansion of the National Broadcasting and Television Service network in country areas. A significant component of these outlays relates to Radio Australia - S4.9 million for program expenditure through the ABC and $3.8 million for transmission expenditure through ATC. An amount of $0.6 million is included for the commencement of rehabilitation of the Radio Australia stations at Shepparton (Victoria) and in the Northern Territory. {:#subdebate-68-114} #### Planning of Broadcasting and Television With the abolition of the Australian Broadcasting Control Board in December 1 976. the Postal and Telecommunications Department now carries out the planning and development of broadcasting and television services generally. {:#subdebate-68-115} #### Regulation of Broadcasting and Television The Australian Broadcasting Tribunal, which was set up in January 1977 following the abolition of the Broadcasting Control Board, is responsible for the regulation and control of the radio and television industry, including conduct of public inquiries in relation to the issue and renewal of licences for commercial, and public, radio and television stations. {:#subdebate-68-116} #### Ethnic Broadcasting The Government proposes to establish a new statutory body to carry out ethnic broadcasting and, at a later date, possibly other specialised broadcasting services which may be allocated to it. Until that body is established, the Postal and Telecommunications Department is continuing to operate the ethnic broadcasting stations in Sydney and Melbourne. An amount of $1.9 million is being provided for the ethnic broadcasting service in 1977-78, compared with expenditure of $0.6 million last year directly related to the formerly experimental stations. {:#subdebate-68-117} #### Libraries Funds under this heading provide for operational expenditure by the National Library of Australia and the Canberra Public Library Service. Total outlays are estimated to be $13.1 million in 1977-78, about the same as in 1976-77. {:#subdebate-68-118} #### Australian National Gallery and Collection The Australian National Gallery commenced operations as a separate statutory authority in. 1976-77. An amount of $11.5 million is provided for the Gallery in 1977-78, comprising $1.0 million for administration, $3.2 million for acquisition of further items for the National Collection, including works of Australian Art, and $7.3 million for construction expenditure on the National Gallery building. The expected completion date of the new Gallery is 1981. {:#subdebate-68-119} #### Film Industry Development The Australian Film Commission encourages the making, promotion, distribution and exhibition of Australian films by providing loans to film makers, and by various promotional activities. During 1976-77 the Commission's role was expanded to include assistance for creative development in film making, which was formerly the function of the Film, Radio and Television Board of the Australia Council. *Assistance to the Arts* The Commonwealth's program of assistance to the Arts is administered by the Australia Council, with the assistance of Boards responsible for theatre, music, literature, Aboriginal arts, crafts and visual arts. (In 1976-77 responsibility for the Film, Radio and Television Board was transferred to the Australian Film Commission.) The total allocation for the Council in 1977-78 is $23.7 million and consists of the following components: The Council will also have available to it in 1977-78 $0.8 million from cash balances. {:#subdebate-68-120} #### War Memorials An amount of SI. 3 million is provided for running costs and capital works of the Australian War Memorial in 1977-78, compared with Sl.O million in 1976-77. {:#subdebate-68-121} #### Archives The Government will continue to develop, preserve and maintain archival resources that are of national significance or of general public interest. The Budget provides S5.8 million for these purposes in 1977-78, including SI. 6 million for the construction of new repositories at Collinswood (S.A.) and Mitchell Park (A.C.T.); comparable expenditure in 1976-77 was $5.1 million. {:#subdebate-68-122} #### Youth, Sport and Recreation Expenditure on these activities in 1977-78 is estimated at $6.7 million. An amount of $3.7 million has been provided to meet existing commitments towards construction costs of community amenities approved under the Capital Assistance for Leisure Facilities Program. Grants under this program amounted to $6.9 million in 1976-77. An amount of $3.0 million, including $1.0 million for a new program of support for national sport and sporting bodies, has been provided for other youth, sport and recreation programs in 1977-78. The Government has also announced that a Sports Advisory Council is to be established to provide advice on sports development and assistance. {:#subdebate-68-123} #### Other Cultural Organisations In 1977-78 Commonwealth expenditure in relation to the Queen's Silver Jubilee year is estimated at $0.8 million, including $0.4 million for commemorative activities. Expenditure in 1976-77 amounted to $2.4 million and included a contribution of $2.0 million to the Queen's Silver Jubilee Appeal for Young Australians. {:#subdebate-68-124} #### Wildlife and National Parks The major items under this heading are grants to the States to acquire land for nature conservation purposes ($0.8 million), support for the Great Barrier Reef Marine Park Authority ($0.4 million), and funding of the National Parks and Wildlife Service ($1.8 million). {:#subdebate-68-125} #### National Estate The Commonwealth provides assistance to State and local Government bodies, National Trusts and other bodies for the protection of the National Estate. An amount of $2.6 million is provided in 1977-78 to finance a program of assistance for the restoration, preservation and improvement of buildings and areas of special significance. {:#subdebate-68-126} #### Australian Heritage Commission The responsibilities of the Australian Heritage Commission include the development of procedures for the protection of the National Estate. The Commission is continuing to compile a National Register of the National Estate which will identify and categorise historic sites, buildings and areas of national historic importance that are worthy of restoration and preservation. The running costs of the Commission in 1977-78 are estimated at $0.5 million. *Cultural and Recreation Activities in the Territories (nec)* This item relates mainly to the maintenance of parks, gardens and sporting facilities in the A.C.T. {: type="1" start="8"} 0. ECONOMIC SERVICES This heading brings together the various services and categories of assistance provided by the Commonwealth to industry and to the community generally. It embraces the provision of economic infrastructure, the regulation of private sector economic activity and more direct forms of Government participation in economic activity. {: type="A" start="A"} 0. TRANSPORT AND COMMUNICATION The Budget provides $844.2 million for transport and communication activities in 1977-78, $144.8 million less than in 1976-77. These outlays represent 3.2 per cent of estimated total outlays for 1977-78. {:#subdebate-68-127} #### Communication {:#subdebate-68-128} #### Australian Postal Commission and Australian Telecommunications Commission These two bodies respectively provide postal and telecommunications services in Australia. Each Commission is required to operate on a commercial basis with the financial objective of generating, by way of charges for services, such amounts as are necessary to meet all operating costs and at least half of its capital expenditure. During 1977-78 the Australian Postal Commission will use surplus funds accumulated from past operating surpluses to repay S28 million of its capital indebtedness to the Commonwealth and to finance an expected loss on its operations. The Australian Telecommunications Commission proposes to raise up to S210 million in longer term borrowings from the domestic capital market in 1977-78 (compared with S200 million in 1976-77); drawings from the Budget in 1977-78 are estimated at S65 million, compared with S215 million in 1976-77. {:#subdebate-68-129} #### Overseas Telecommunications Commission This body, which is also required to operate on a commercial basis, provides telecommunications services between Australia and other countries. In 1976-77 the Commission repaid to the Commonwealth S10 million of its capital. {:#subdebate-68-130} #### Radio Frequency Management Administration of the Wireless Telegraphy Act includes regulation of the operations of the many radio communications stations operating in Australia, including the recently approved category of "Citizens Band" stations. A net provision of $5.6 million is included for 1977-78. {:#subdebate-68-131} #### Air Transport {:#subdebate-68-132} #### Advances to Qantas Airways Ltd and Australian National Airlines Commission Past advances were mainly in the form of proceeds of loans raised by the Commonwealth on behalf of the airlines to assist in the financing of aircraft purchases. No provision has been made for loans to the airlines in 1977-78. Amounts repaid by the airlines to the Commonwealth in respect of past loans - estimated at $23.0 million in 1977-78 - are in turn repaid to the lenders. {:#subdebate-68-133} #### Civ/7 Aviation Services The Department of Transport provides many services to the air transport industry, including the provision and operation of over 80 airports and a network of air navigational facilities. Those activities account for the major portion of administrative and operational expenditure and outlays on buildings, works and equipment. Expenditure on air transport activities in 1977-78 (estimated at $161.5 million) reflects the Government's current policy of expenditure restraint, and proposed reduction in staff numbers during the year. Steps are being taken to maintain efficiency in the provision of services and facilities to the industry to ensure that the existing high standards are preserved. Total estimated expenditure of $20.2 million on buildings, works and equipment includes nearly $4.2 million for land acquisitions, principally at Sydney's KingsfordSmith Airport ($1,975 million), Melbourne's Tullamarine Airport ($0.65 million), Brisbane Airport ($0.68 million) and Perth Airport ($0,345 million). Provision for buildings and works in 1977-78 is S5.5 million, including approximately $1.4 million for extensions to the southern apron at Kingsford-Smith Airport. An amount of $0.9 million is provided for final payment for three F28 aircraft delivered in 1976-77. For purchases of navigational aids and other technical equipment additional to the F28 purchases, there is provision in 1977-78 of $9.5 million, an increase of approximately $3 million over expenditure in 1976-77. {:#subdebate-68-134} #### Air Service Subsidies Following the study of essential air transport needs in the area served by Connair Pty Ltd, the Government proposes to continue subsidies to that company over the next three years although on a reducing basis; the level of assistance in 1977-78 is $0,425 million. Subsidies will also be payable, on a basis yet to be determined, to certain other operators of essential air services in remote areas of Western Australia, Queensland and the Northern Territory. {:#subdebate-68-135} #### Other Expenditure This item includes an amount of S0.6 million to enable continuation of the Interscan program and other aviation research in 1977-78. An amount of SI. 75 million is included for maintenance and development of aerodromes under the aerodrome local ownership plan. {:#subdebate-68-136} #### Civil Aviation Services - Recoveries The Government has decided not to increase air navigation charges during 1977. Other recoveries are estimated to increase by S7.0 million to S3 1.2 million in 1977-78. Estimated revenue of SI 1.1 million from airport rentals reflects the Government's decision to charge full economic rentals at capital city airport terminals; SI. 5 million is anticipated from charges to be introduced in 1977-78 for a wide range of regulatory services formerly provided by the Department of Transport at little or no cost to the user. Expenditures incurred on flight testing of RAAF navigational aid facilities are also to be recovered from the Department of Defence. Revenue from business concessions at airports is expected to increase in 1977-78, and receipts from car parking fees to decrease, following the transfer of certain departmental car parking activities at several airports to concessionaires. Estimated revenue from the sale in 1977-78 of surplus aircraft from the Department of Transport's fleet is SI million. {:#subdebate-68-137} #### Road Transport {:#subdebate-68-138} #### Road Grants The Budget provides a total of $477.9 million in grants to the States for roads in 1977-78. That amount comprises $475 million in respect of 1977-78 and some S2.9 million to be paid in respect of 1976-77 commitments. Altogether there will be an increase of S44.1 million over payments during 1976-77. As previously announced, the Government intends that the 1978-79 and 1979-80 grants will be at least equivalent in real terms to the 1977-78 level of grants of S475 million. {:#subdebate-68-139} #### Road Construction and Maintenance - Territories Funds for road construction and maintenance in the Territories are to be increased by $20.0 million to $49.9 million in 1977-78. Of that amount, $7.5 million has been allocated for the continued upgrading and maintenance of the Stuart and Barkly highways, $12.0 million for construction and maintenance of other roads in the Northern Territory, and $30.4 million for road construction and maintenance in the Australian Capital Territory. Construction of the Molonglo arterial is expected to require SI 3 million of the latter allocation. {:#subdebate-68-140} #### Road Construction and Maintenance - Other Outlays on other road construction and maintenance include S5.2 million in assistance subsequent to the Tasman Bridge disaster, including restructuring of the Bridge to provide an additional traffic lane. Of this total an amount of S0.6 million is provided for the continuation of design and related investigations for the proposed second Derwent Bridge at Dowsings Point, Hobart. Repayments (by Queensland) of advances provided for the construction of beef cattle roads are estimated at $0.6 million. {:#subdebate-68-141} #### Road Research and Investigations The apparent reduction shown in the table for the provision for road research and investigations in 1977-78 compared with 1976-77 reflects a classification change. The Bureau of Roads, which was previously included under this heading, was amalgamated with the Transport Department's Bureau of Transport Economics in 1977 and the relevant outlays are now shown under 'Transport Planning and Research'. {:#subdebate-68-142} #### Rail Transport *Australian National Railways (ANR)* The major provisions included are $55.0 million to meet operating losses expected in 1977-78 and $33.3 million for ANR's capital works program. Almost all of the provision for operating losses is in respect of the Tasmanian and non-metropolitan South Australian railway systems for which the ANR has had financial responsibility since 1 July 1975. **Major elements** in the capital works program are the construction of a standard gauge railway between Tarcoola and Alice Springs and the rehabilitation of the Tasmanian railway system. Also included in the ANR item is an amount of $0.45 million to reimburse ANR for the loss incurred on continuing, at the direction of the Government, the operation of the passenger service in Tasmania known as the Tasman Limited. There is no 1977-78 provision for the Adelaide/Crystal Brook Rail Standardisation project. *Rail Projects in the States* State Railways repayments of past advances from the Commonwealth for rail projects (mainly standardisation) are estimated to amount to $4.2 million in 1977-78. Some rail projects in the States appear under the 'Urban Public Transport' heading. {:#subdebate-68-143} #### Other Surface Transport {:#subdebate-68-144} #### Transport Planning and Research The Commonwealth is providing$8.9 million in 1977-78 under proposed new arrangements for assistance to the States for approved land transport research projects. This includes $0.9 million to meet commitments entered into by the States in 1976-77. In addition, $3 million is provided to finance the Bureau of Transport Economics (formerly recorded as part of the general administrative outlays of the Department of Transport). The functions of the Bureau have been expanded following its absorption of the former Bureau of Roads, and now encompass detailed investigations of the economics and financing of road and other transport modes. {:#subdebate-68-145} #### Urban Public Transport The Commonwealth provides financial assistance to the States, under the terms of the Urban Public Transport Agreement, to meet two-thirds of the cost of approved urban public transport projects. Payments to the States under the terms of the Agreement to the end of 1976-77 totalled $137.3 million. Proposed expenditure in 1977-78 of $51.0 million includes an estimated $27.7 million to meet the Commonwealth's share of cost escalation on projects approved under the Agreement, and $5 million for new projects. {:#subdebate-68-146} #### Shipping and Harbours {:#subdebate-68-147} #### Australian Shipping Commission An amount of $1.1 million is provided for advances to the Australian Shipping Commission (ANL) in 1977-78 to partially finance its capital program. In 1977-78, ANL is financing most of its capital program from internally generated funds, and from overseas borrowings (for major items of capital equipment). ANL's current program includes payments for the construction of seven bulk carriers (four 15 000 dwt, one 25 000 dwt, one 122 000 dwt and one 138 000 dwt), a roll-on roll-off vessel for the South East Asian trade and associated equipment and a container terminal at Botany Bay. ANL is expected to repay $6.5 million in 1977-78 in respect of earlier loans from the Budget. {:#subdebate-68-148} #### Shipping Subsidies - Tasmania An amount of$23 million is provided for Tasmanian freight equalisation in 1977-78;$1 7 million for the northbound scheme and$6 million for the new southbound scheme which operates retrospectively from 1 July 1976. The schemes aim to make the door-to-door freight cost of eligible cargoes shipped between Tasmania and the mainland approximate the door-to-door costs of moving similar goods by road or rail over similar distances on the mainland. The provision for shipping subsidies to Tasmania also includes $2.0 million for the Australian Shipping Commission to subsidise the operation of the 'Empress of Australia' passenger service between Tasmania and the mainland. *Shipping and Harbours - Other* 'Other' outlays of $4.1 million in 1977-78 include $2.9 million for capital expenditure, mainly by the Department of Transport on navigational aids and facilities. {:#subdebate-68-149} #### Pipelines The advance of $33.8 million to the Pipeline Authority provided in 1977-78 includes $5.5 million for the completion of the Moomba-Sydney pipeline and S28.3 million towards meeting capital and interest commitments in respect of the Authority's borrowings. Repayments by the Authority are estimated to total $11.4 million in 1977-78. In addition, provision is made for a repayment of $1.9 million in 1977-78 in respect of advances made to South Australia for a natural gas pipeline. {:#subdebate-68-150} #### General Administrative and Other Expenditure An amount of $34.8 million is provided in 1977-78 for the running expenses of the Department of Transport (other than expenses related to provision of air transport services and the functions of the Bureau of Transport Economics), of which S25.9 million represents wages and salaries. {:#subdebate-68-151} #### Other Recoveries Light dues, which are charged on commercial shipping for the use of marine navigational aids provided by the Commonwealth, are the major source of recoveries under this heading, *it* is proposed to increase the charge from 35 cents to 41 cents per net registered ton per quarter from 1 October 1977. This increase is expected to yield additional revenue of $2.3 million in 1977-78, leading to full recovery of estimated costs in 1977-78. {: type="A" start="B"} 0. WATER SUPPLY AND ELECTRICITY Outlays on urban water supply and electricity projects are estimated to total $44.0 million in 1977-78, a decrease of $28.1 million compared with 1976-77. {:#subdebate-68-152} #### Urban Water Supply The Commonwealth is continuing to provide financial assistance to South Australia for water treatment works in Adelaide. The Budget includes an amount of $6.0 million for this purpose compared with $9.2 million in 1976-77. Also included here is an amount of $19.3 million for expenditure on water supply works in the Territories, including $16 million for expenditure on the Googong Dam and associated works. The latter project will increase water storage capacity in the Canberra/ Queanbeyan area to a level capable of sustaining a population of around 400 000. The Googong Dam is expected to be completed in 1978, at a total estimated cost of about $40 million. {:#subdebate-68-153} #### Snowy Mountains Scheme The diminishing level of outlays on the Snowy Mountains Scheme over recent years reflects the virtual completion of the Scheme. The proposed payment of $0.6 million to the Snowy Mountains Hydro-electric Authority will enable the Authority to undertake certain capital works pending completion of the Government's investigation of ways in which the New South Wales and Victorian Governments might share in financing assets required for the operation and maintenance of the Scheme. {:#subdebate-68-154} #### Gladstone Power Station Commonwealth assistance is being provided to the Queensland Government, by way of loans, to help finance the construction of a thermal power station at Gladstone in central Queensland. Assistance from the Commonwealth for the project is, within specified limits, proportionate to the total cost of the power station in the ratio of 80 to 155. Payments of$39 million and $26.4 million were made in 1975-76 and 1976-77 and a final estimated payment of$1.0 million will be made in 1977-78. *Electricity Supply in the Territories* The increase of $7.4 million in estimated expenditure in 1977-78 largely reflects work being undertaken in Darwin, for which funds amounting to $18.8 million are provided in the Budget. That estimate includes provision for the rehabilitation of electricity reticulation, the servicing of sites for new housing and the continuing augmentation of the Stokes Hill Power Station. {:#subdebate-68-155} #### Repayments Repayments in 1977-78 are estimated at $8.2 million, consisting of repayments of $5.2 million by the Snowy Mountains Hydro-electric Authority, and of S3 million by the Tasmanian Government in respect of assistance previously provided for hydroelectric power development in that State. {: type="A" start="C"} 0. INDUSTRY ASSISTANCE AND DEVELOPMENT The Commonwealth assists industry through a variety of measures, including direct financial assistance, taxation concessions, guaranteed home price arrangements, financial guarantees and the customs tariff. Net direct assistance from the Budget (i.e., after deducting amounts collected by way of industry levies and charges such as the wool tax and the livestock slaughter levy) is estimated at$243.0 million in 1977-78 compared with $206.5 million in 1976-77, an increase of 17.7 per cent. These outlays represent 0.9 per cent of total estimated outlays in 1977-78. Direct industry assistance takes the form of bounties and subsidies, reconstruction and adjustment schemes, contributions to research and promotion programs, price support and other payments to or for the benefit of industry. It includes also some outlays by Government departments and instrumentalities (e.g., Department of Overseas Trade, Department of Industry and Commerce, Department of Primary Industry and the Australian Tourist Commission) which provide many services either free of charge or for charges which do not recover fully the costs incurred. Apart from these direct outlays from the Budget, substantial additional assistance has been provided through the Budget by way of special taxation concessions which, as they result in a reduction of Government revenues, are as much a call on the Budget as direct outlays. The amount of revenue forgone in 1976-77 through the main taxation concessions for which data are available is estimated to have been$246 million. Further information relating to these taxation concessions is provided at the end of the commentary on this sub-function. Outlays under some other functional headings in this Statement also assist industry. Examples include the provision of airports and airways facilities for the aviation industry, assistance for the development of the film and television industry, some specific purpose payments to the States, expenditure to improve the defence capacity of industry, and part of the expenditure of the CSIRO. The following table shows net outlays on direct assistance to industry in the past two years, together with estimates for 1977-78. Brief comments on major items follow the table. {:#subdebate-68-156} #### Forestry and Fishing Industries {:#subdebate-68-157} #### Softwood Forestry Development Under the *Softwood Forestry Agreements Act* 1972, S3 1.4 million was paid to the States up to 30 June 1977 for plantings made in the five year period to the end of 1975-76. It is estimated that a further S0.45 million will be provided in 1977-78. The Commonwealth extended the agreement authorised by the 1972 Act for one year, with amounts payable to the States in 1976-77 being limited in aggregate to $6 million. The actual amount paid to the States in 1976-77 was S5.8 million. The Commonwealth has announced that $4.2 million will be provided by way of interest-bearing loans to the States in 1977-78, for the maintenance of existing Commonwealth financed plantings. This allocation is to be the first under a new five year agreement being negotiated with the States. {:#subdebate-68-158} #### Agricultural and Pastoral Industries {:#subdebate-68-159} #### Wool Industry The Government has authorised the Australian Wool Corporation to continue to operate a minimum reserve price of 284 cents per kilo clean on a whole clip average basis for the 1977-78 wool selling season. The Corporation will continue to regulate the flow of wool onto the auction market to improve the balance between quantities of wool supplied and demanded and will exercise a 'pot-holing' function to reduce losses due to random movements in prices when the market is above the floor. During 1976-77 the Australian Wool Corporation repaid SI 45 million of earlier borrowings from the Commonwealth under the Wool Marketing (Loan) Act; and is expected to repay the balance of SI 00 million in 1977-78. The wool tax (8 per cent on the gross returns from wool sold) is estimated to yield S95 million in 1977-78. This tax includes a special levy of 5 per cent on the gross returns from wool sold, to offset any losses which may arise from the operation of the reserve price scheme; it is estimated that the special levy will result in an amount of S59.5 milllion being collected and paid to the Corporation's Market Support Fund in 1977-78. For 1977-78 the Budget provides for the Commonwealth to contribute S3 1.4 million to wool promotion and research in 1977-78 being SI 9.9 million for promotion and $11.5 million for research. The latter figure is made up of $6.9 million for payment to the Wool Research Trust Fund, S4.4 million for the CSIRO and S0.2 million for the Bureau of Agricultural Economics. The payment of S4.4 million to the CSIRO represents a change from previous years in the financing of wool research and is not reflected in figures given in the table above (but is included in the estimates of expenditure through CSIRO in 'General and Scientific Research'). In addition to the Commonwealth's contribution, S32.1 million is expected to be contributed by the industry from proceeds of the Wool Tax, and $3.1 million, from reserves. Including the $4.4 million payment to CSIRO, total expenditure for wool promotion and research in 1977-78 is estimated at $66.6 million. {:#subdebate-68-160} #### Wheat Industry The sixth Wheat Industry Stabilisation Scheme commenced with the marketing of the 1974-75 crop and covers the seasons 1974-75 to 1978-79. The stabilisation arrangements provide for grower contributions to the Stabilisation Fund when export returns are relatively high and payments to growers from the Fund when export returns are relatively low. If grower contributions held in the Fund are insufficient to make required stabilisation payments, the Commonwealth, under certain conditions, contributes to the Fund to make up the shortfall. The Fund has an upper limit of $80 million and once this maximum is achieved any further grower contributions or interest earned by the Fund are refunded to the Wheat Board for distribution to growers who earlier contributed to the Fund. The prescribed maximum of $80 million was reached in July 1976 and refunds amounting to $41.1 million were made to growers in 1976-77. A further grower contribution of $30 million in respect of the 1976-77 crop season is expected to be paid into the Fund in 1977-78 and this amount, together with interest earned during the year, will be refunded to growers. No stabilisation contributions by the Commonwealth are required in 1977-78. The Government recently referred the question of wheat stabilisation arrangements to apply after the 1978-79 crop season to the Industries Assistance Commission for report by May 1978. {:#subdebate-68-161} #### Dairy Industry An amount of $1.4 million is provided in 1977-78 for estimated commitments under the now terminated Dairy Adjustment Program, through which assistance was made available to producers to 31 December 1976. This scheme was superseded by the establishment of the Rural Adjustment Scheme (see below) which, from 1 January 1977, provides expanded assistance to a broader range of producers. The Government introduced Stage I of new marketing arrangements for dairy products on 1 July 1977. Under these arrangements an equalisation levy (equal to the difference between the domestic price and the assessed average export price) is imposed on the production of certain prescribed dairy products, and the proceeds are redistributed among manufacturers with the object of protecting the domestic price structure and ensuring that manufacturers receive an equalised return from total domestic and export sales. Levy collections and payments to manufacturers are estimated at $50.0 million in 1977-78. Pending introduction of the new marketing arrangements, the Government undertook to provide a measure of income stability by underwriting the equalisation value of skim milk powder in 1975-76, and butter, cheese, skim milk powder and casein in 1976-77 and 1977-78. The levels of support for skim milk powder and casein are conditional on State participation on a $1 State: $2 Commonwealth basis. Under 'Price Support' there is a provision of $6.5 million in 1977-78 for estimated Commonwealth liability for underwriting of cheese, skim milk powder and casein values up to 30 June 1 977, and of butter values up to 3 1 December 1 976. 'Repayments' include, in addition to the new levy, repayments from the States in respect of the Dairy Adjustment Program and its predecessor, the Marginal Dairy Farms Reconstruction Scheme. {:#subdebate-68-162} #### Fruit Industry Legislation has been enacted to extend the Apple and Pear Stabilisation Scheme to cover the three crop seasons 1977-78 to 1979-80. For the 1977-78 season, the maximum rate of assistance for 'at risk' exports to the United Kingdom and Europe will be maintained at S2 per box for apples and at 80 cents per box for pears, subject to an overall limit on Commonwealth contributions of S4.7 million. In addition, the Commonwealth has agreed to provide up to S0.5 million in supplementary assistance for apple exports on a dollar for dollar basis with participating States, with the precise nature and application of the assistance being determined in light of information available from the 1977-78 export season operations. Supplementary assistance arrangements for apple exports have been in operation since the 1974-75 crop season. The Fruitgrowing Reconstruction Scheme was introduced in 1972 with an upper limit of S4.6 million, which was subsequently increased to $5.6 million, to provide assistance to growers for the removal of fruit trees deemed surplus to long-term market requirements. Applications for assistance under the scheme closed on 31 December 1976 and trees had to be removed by 30 June 1977. Payments prior to 30 June 1977 amounted to S4.7 million. The 1977-78 provision of $1.3 million is to meet outstanding claims including an unexpectedly large number of applications from growers in Western Australia and Tasmania, in response to which provision has been made to raise the former limit by $0.4 million. {:#subdebate-68-163} #### Poultry Industry Expenditure on stabilisation and research in the poultry industry is financed mostly from industry levies which flow back to the industry through State egg marketing authorities in accordance with the terms of the egg industry stabilisation scheme. A reduction in both receipts and expenditure for stabilisation purposes in 1977-78 reflects the impact of reduced hen quotas under State production control arrangements. {:#subdebate-68-164} #### Cattle, Sheep and Pig Meat Industry Outlays in 1977-78 for meat export inspection and animal health services undertaken by the Bureau of Animal Health are estimated at $31.1 million, less estimated revenue of $3.1 million from charges to exporters for meat export inspection services outside prescribed hours. Provision is made for a total expenditure of $19.6 million on the bovine brucellosis and tuberculosis eradication campaign. That amount includes $15.1 million for eradication operations, of which S8.4 million is estimated to be recovered from the industry, and S4.5 million in grants towards slaughter compensation payments making a total net payment of SI 1.2 million. Some SI 8.4 million of the total outlay of $19.6 million is expected to be paid to the States. The joint Commonwealth/State scheme to provide carry-on finance at concessional rates of interest to specialist beef producers was incorporated in the Rural Adjustment Scheme which came into operation on 1 January 1977. Outlays not Allocated to Specific Agricultural and Pastoral Industries {:#subdebate-68-165} #### Rural Reconstruction/ Adjustment The Rural Reconstruction Scheme, which operated from 1971, was terminated on 31 December 1976. A provision of S4.6 million has been made for 1977-78 to finance outstanding commitments for assistance to producers which were approved by the States prior to the termination date. From 1 January 1977 a Rural Adjustment Scheme, established under the States Grants (Rural Adjustment) Act, came into operation. Under this scheme, which replaced the Rural Reconstruction Scheme, the Dairy Adjustment Program and the joint Commonwealth/State scheme of carry-on finance for specialist beef producers, financial assistance is made available to the States for purposes of farm debt reconstruction, farm build-up, farm improvement and rehabilitation, carry-on finance and household support. Assistance for debt reconstruction, farm build-up, farm improvement and rehabilitation is made available by the Commonwealth on an overall 85 per cent loan/ 15 per cent grant basis with the Commonwealth contributing a further amount to assist in defraying administrative expenses. For the household support component the Commonwealth finances all assistance and contributes towards administrative expenses, with the States repaying to the Commonwealth all principal and interest recouped by them. For carry-on finance, the States share equally with the Commonwealth both the financing of loans (and administrative costs) and all principal and interest payments received from producers. Taken together, outlays under the Rural Reconstruction Scheme and the Rural Adjustment Scheme are estimated at $51.5 million in 1977-78, an increase of $22.0 million on 1976-77 outlays. {:#subdebate-68-166} #### Fertilizer Bounties Legislation has been enacted to continue the phosphate fertilizer bounty for five years from 1 July 1977 at the rate of $12 per tonne. Eligibility for bounty was extended to include crushed or calcined phosphate rock and phosphate substances for use as stock feed supplements. Payments under the *Phosphate Fertilizers Bounty Act* are estimated at $40 million in 1977-78. The Government has reviewed its earlier decision to reduce the subsidy rate on nitrogenous fertilizers and the Budget provides for the subsidy payable under the *Nitrogenous Fertilizer Subsidy Act* 1966 to be continued at the rate of $60 per tonne from 1 January 1978. Subsidy payments in 1977-78 are estimated at $12 million. {:#subdebate-68-167} #### Inspection Services In addition to the export meat inspection services described above, the Commonwealth provides export inspection facilities in respect of grains, fruits and other exports requiring quality certification. The net costs of these services are estimated at $5.0 million in 1977-78. {:#subdebate-68-168} #### Agricultural Extension and Research The Budget provides $9.9 million in grants to the States for the development of their agricultural advisory services under arrangements dating from 1952-53. Under those arrangements, the Commonwealth proposes to spend a further $0.2 million directly on projects which are nominated by the States but which are of common interest to several States. The Government is reviewing the future of the grants beyond 30 June 1978. {:#subdebate-68-169} #### Irrigation and Other Pastoral Water Projects Expenditure under this heading comprises Commonwealth assistance to the States for rural water conservation and irrigation purposes and flood mitigation. The estimates provide for continuing assistance for the Dartmouth Dam on the Mitta Mitta River in Victoria ($6.5 million) and for the Namoi River Weirs in NSW ($1 million). Under a continuing program of water resources assessment, $6.7 million will be provided to the States in 1977-78 for the assessment of surface and underground water resources. Additional information on these projects is contained in the accompanying Budget Paper entitled *Payments to or for the States and Local Government Authorities 1977-78.* {:#subdebate-68-170} #### Flood Mitigation The Commonwealth has agreed to participate with the State and local authorities in a new flood mitigation program for certain New South Wales coastal rivers. A grant of $1.0 million will be provided to New South Wales for this purpose in 1977-78. {:#subdebate-68-171} #### Land Development Projects {:#subdebate-68-172} #### Soil Conservation Provision of $0.2 million has been made in 1977-78 as further interim assistance to the States pending consideration of a comprehensive study on soil conservation problems. {:#subdebate-68-173} #### Repayments Estimated repayments of$5.2 million in 1977-78 include $3.4 million in repayments by War Service Land Settlers. {:#subdebate-68-174} #### General Administrative and Other Expenditure Included under this heading are the administrative expenses of the Department of Primary Industry ($11.9 million) and the Bureau of Agricultural Economics ($4.9 million). Also included is $0.25 million for the Commonwealth contribution to the Australian Plague Locust Commission. Increases in administrative expenditure mainly reflect salary increases, offset in part by reduction in staff numbers. {:#subdebate-68-175} #### Mining Industry {:#subdebate-68-176} #### Uranium - Exploration and Development In early 1976 the Government announced that uranium exploration by the Australian Atomic Energy Commission was to be discontinued at the close of the 1976 field season. Expenditure on the Commission's uranium exploration program in 1976- 77 was $1.1 million. Outlays in 1976-77 also included a Commonwealth loan of $1.8 million to Mary Kathleen Uranium Ltd to help it overcome liquidity difficulties. Provision of $0.13 million is made in 1977-78 to maintain the Commission's beneficial interest in the Ngalia Basin uranium exploration joint venture. {:#subdebate-68-177} #### Bureau of Mineral Resources The provision of $12.5 million for expenditure by the Bureau in 1977-78 compares with expenditure in 1976-77 of $12.4 million. It is intended that the Bureau progressively restrict its activities in the States to those which could not reasonably be undertaken by State Government agencies. The activities of the Bureau will nevertheless continue to be a significant form of assistance to the mining industry through its work in gathering and disseminating geological and geophysical information relevant to the exploration and development by industry of the nation's mineral resources. {:#subdebate-68-178} #### Other Mining (Net) The main provision under this heading for 1977-78 is for 'act of grace' payments of $2.8 million to sand mining companies and certain first line contractors to those companies which were directly affected by the Government's decision to prohibit exports of mineral sands mined from certain areas of Fraser Island. Payments of $0.1 million were made for this purpose in 1976-77. Other provisions include $2.6 million for expenditure in relation to the Commonwealth's interest in the Cooper Basin Gas Fields in South Australia, $0.8 million for the Commonwealth's contribution towards administrative costs of the Joint Coal Board, $0.7 million for the operation of the Northern Territory Mines Branch, and $0.25 million for payment to the Australian Mineral Development Laboratories (AMDEL). Under the April 1977 agreement with the South Australian Government the Commonwealth is obliged to make the latter payment to AMDEL because Commonwealth work contracted to AMDEL in 1976-77 was less than the amount specified in the agreement. The Government proposes to establish a new industry-financed coal research program. To finance this increased research, there will be a levy of 5 cents a tonne on coal produced in Australia. It is estimated that $3.9 million will be raised from the levy in 1977-78; the balance of $3.4 million expected to be available after allowance for expenditure lags, and costs of collection and administration, will be spent on coal research. {:#subdebate-68-179} #### Divestment of Petroleum and Minerals Authority Investments Revenue of about $15.0 million is expected in 1977-78, compared with $3 million in 1976-77, from the divestment by the Commonwealth of assets acquired by the former Petroleum and Minerals Authority. {:#subdebate-68-180} #### Manufacturing Industry {:#subdebate-68-181} #### Shipbuilding Assistance Assistance is payable in respect of the construction of vessels in Australia following a case-by-case examination by the Australian Shipbuilding Board. Assistance for new shipbuilding contracts is provided under the *Ship Construction Bounty Act* 1975 as a direct bounty to shipbuilders. The maximum level of assistance is currently 33 per cent; but the Government's shipbuilding policy provides for a phased reduction in the level of assistance to an eventual long-term rate of 25 per cent by December 1980. Outlays under this scheme in 1977-78 are estimated at $6.2 million and represent subsidies towards the construction of 19 ships. Prior to the enactment of the bounty legislation in June 1975 a shipbuilding subsidy was provided by the Commonwealth buying ships and then selling them to shipowners at a lower price. It is expected that construction of the final 4 ships to be subsidised under those arrangements will be completed in 1977-78, at a net cost to the Budget of $5.2 million. An amount of $1.2 million is provided for the administrative expenses of the Shipbuilding Board. {:#subdebate-68-182} #### Industrial Research and Development Grants The provision of $14 million includes final payments totalling $8 million to be made in 1977-78 under the *Industrial Research and Development Grants Act* 1967. These final payments cover all outstanding general grants relating to the 1975-76 grant year. A new scheme, under the *Industrial Research and Development Incentives Act* 1976, came into effect on 1 July 1976. Commencement grants totalling $4 million, intended to encourage the development by recipients of a basic capability in industrial research and development, will be paid in 1977-78 in respect of the 1976-77 grant year. A further $2 million is provided to meet a substantial portion of project grants expected to be approved in 1977-78, and residual payments of project grants approved in 1976-77. {:#subdebate-68-183} #### Agricultural Tractor Bounty The *Agricultural Tractors Bounty Act* 1977 provides for payment of a bounty on eligible tractors produced and sold after 1 January 1977. Bounty payments under this Act are indexed quarterly, and currently range from $549 to $3771 per tractor, depending on the power of the tractor, and subject to local content requirements. Payments under the Act in 1977-78 are estimated to be $5 million. Prior to 1 January 1977, bounties were provided on a somewhat different basis, under the *Agricultural Tractors Bounty Act* 1966. Payments under both Acts in 1976-77 totalled $4.9 million. {:#subdebate-68-184} #### Machine Tools Bounty Operation of the *Metal Working Machine Tools Bounty Act* 1972 has been extended by proclamation until 30 June 1979 pending a review by the Industries Assistance Commission. Payments are based on a bounty rate of 33i per cent of factory cost subject to certain local content requirements and are expected to amount to 52.5 million in 1977-78. {:#subdebate-68-185} #### Book Bounty Payments under the *Book Bounty Act* 1969 are made in respect of eligible books manufactured in Australia at the rate of 331/3 per cent of the cost of production. The devaluation of the Australian dollar in November 1976 was followed by a surge in local book manufacturing which resulted in relatively high payments in 1976-77. An amount of $7 million has been provided for bounty payments in 1977-78. {:#subdebate-68-186} #### Other Bounty Payments The *Bed Sheeting Bounty Act* 1977 limits total bounty payments under the Act to $0.5 million per annum and that amount is provided in 1977-78. Payments under the Act will continue until decisions are taken on long-term assistance for the industry. Under the *ADP Equipment Bounty Act* 1977 bounty is to be payable for a period of seven years but the rate is to be gradually phased down over that period; $0.6 million is provided in 1977-78. {:#subdebate-68-187} #### Export Development Grants Grants administered by the Export Development Grants Board are provided to encourage firms to seek and develop overseas markets. Grants are payable on the basis of eligible export market development expenditure in respect of goods and services substantially of Australian origin. The Government has referred the question of financial incentives to exporters to the Industries Assistance Commission for inquiry and report, and is not now proceeding with legislation foreshadowed in 1976 to reduce benefits and expenditure under the scheme. As a means of limiting current expenditures, however, payments in 1977-78 on new claims under the scheme will be restricted, as in 1976-77, to $10 000 in the first instance, with the balance of larger grants being held over to the following year. Consideration will be given to payments in excess of $10 000 where imposition of the ceiling would result in severe financial difficulties. The 1977-78 Budget provision of $30 million covers eligible claims for grants outstanding at the end of 1976-77 (estimated at $18 million) and up to $12 million in respect of new commitments falling due in 1977-78. {:#subdebate-68-188} #### Other Assistance Other industry support expenditure provided for in 1977-78 includes assistance for the manufacture of electronic components ($0.144 million), grants for the Industrial Design Council of Australia ($0.385 million), a grant to Pritchard Steam Power Pty Ltd ($0.075 million) and final payments under the former structural adjustment assistance scheme ($0.097 million). {:#subdebate-68-189} #### General Administration This provision covers operating costs of the Department of Industry and Commerce, and of the Export Market Development Grants Board. {:#subdebate-68-190} #### Tourist Industry A provision of $2.8 million is included for the Australian Tourist Commission, for the purpose of encouraging overseas visitors to travel to Australia. Provision of $0.2 million has been made also to finance the activities of the Canberra Tourist Bureau. {:#subdebate-68-191} #### Other Assistance to Industry {:#subdebate-68-192} #### Australian Industry Development Corporation The broad functions of the Australian Industry Development Corporation are to help finance the development and growth of Australian private enterprise in areas of activity concerned with, or incidental to, the manufacture, processing, treatment, transportation or distribution of goods, or the development or use of natural resources or of technology, and to secure Australian participation in the ownership and control of companies engaged in such activities. The Corporation's paid-up capital is now $62.5 million; no additional capital provision is expected to be required this year. The Corporation has no plans to request the Government to borrow funds on its behalf in 1977-78. {:#subdebate-68-193} #### Export and Trade Promotion Expenditure on export and trade promotion in 1977-78 is estimated at $17.3 million. The total includes expenditure on the Trade Commissioner Service ($12.9 million), matching grants to primary product marketing boards ($0.9 million) and trade publicity fairs, displays and trade promotion visits ($3.4 million). {:#subdebate-68-194} #### Export Finance and Insurance Corporation The Export Finance and Insurance Corporation (EFIC) provides export credit insurance and guarantee facilities, insurance cover for direct investment overseas against non-commercial risks, and, where necessary, export finance for medium and long-term credit sales of capital goods. During its first seventeen months of operation EFIC's export finance facility was funded with loans from the Budget. Since July 1976, the facility has been financed by the trading banks via loans to EFIC at commercial rates of interest. The Corporation on-lends these funds to foreign buyers at concessional interest rates. The difference between the commercial rates at which EFIC borrows and the rates at which it onlends is financed from the Budget by an interest rate subsidy payable to EFIC each year. A subsidy of almost $0.3 million was provided in 1976-77 and a provision of $1.5 million has been made for 1977-78 for this purpose. In 1976-77 a payment of some $0.3 million was also made in respect of a 'national interest' case. The 1976-77 'subsidy commitment authority', the mechanism to control commitments on the Budget in the years ahead arising from the Corporation entering into loan transactions with overseas buyers at subsidised interest rates, was set at $15 million. At 30 June, the Corporation had entered into loans in support of capital goods exports aggregating $77 million, requiring use of the subsidy commitment authority of about $9.18 million, payable over the term of the loans. In addition, the Corporation had advance commitments to enter into loans of $11 million, involving use of a further $1.75 million of subsidy commitment authority in 1977-78. The Government has decided to increase the cumulative subsidy commitment authority to $17.5 million. The increase of $2.5 million over 1976-77, together with the balance of the authority not committed at 30 June 1977, will enable EFIC to enter into loans aggregating about $50 million in the next 12 months, and to support tenders for capital goods exports considerably in excess of this amount, given that only a portion of tenders are likely to be successful. Industry Assistance Through the Taxation System A considerable amount of assistance to industry has been provided in the past through special taxation concessions. Some of these concessions were withdrawn during 1972-73 while others were withdrawn or modified in 1973-74, 1974-75 and 1975-76. On the other hand, a new concession was introduced in 1974-75 - double depreciation - applicable to new plant and equipment first used or installed ready for use by taxpayers in the manufacturing and primary industry sectors on or after 1 July 1974 and before 1 July 1975. The double depreciation scheme was extended in both time and coverage in 1975 but when the income tax law was amended to provide a new investment allowance, provision was also made for the discontinuance of the double depreciation scheme for plant used or installed after 30 June 1976. The new investment allowance is applicable to new plant and equipment purchased, leased or constructed under a contract made on or after 1 January 1976. A 40 per cent rate will apply for the period 1 January 1976 to 30 June 1978, and a 20 per cent rate for the period 1 July 1978 to 30 June 1983. Other provisions were enacted in 1976-77, which will affect revenue collections in 1977-78, relating to accelerated deductions for certain capital expenditure by mining enterprises, and to a deduction for a trading stock valuation adjustment. Such concessions result in a reduction of, or a delay in the receipt of, Commonwealth revenue (and a corresponding increase in the funds available to the recipients). They are, in fact, as much a call on the Budget as equivalent direct outlays would be, and for this reason have sometimes been described as disguised expenditures. Assistance of this type through the taxation system has been provided mainly by way of income tax concessions which permit firms and individuals to make deductions from their assessable income additional to those authorised under the general provisions of the income tax law. The amount of revenue forgone in 1976-77 through the main taxation concessions is estimated to have been about $246 million. Details are shown below. (Pay-roll tax rebates under the export incentive scheme in respect of exports in 1970-71 and prior years are included under the heading 'Manufacturing Industry'.) Most of the relevant concessions in the income tax field may be grouped in three broad categories, namely : A those allowing the deduction of larger amounts than are authorised under the general provisions of the law (included in this category is the rebate for export market development expenditure, which, until it was withdrawn, in respect of expenditure incurred on or after 1 July 1974, gave a tax saving additional to the saving resulting from the deductions from income for this expenditure); B those allowing certain taxpayers to deduct the cost of items of plant over shorter periods than is the case for the general run of taxpayers; and C those exempting certain classes of income, now confined to exemption of income from gold mining. The estimated amounts of revenue forgone in 1976-77 under the main provisions in categories A and B are shown in the following table. A miscellany of other provisions is not included, in some cases because of lack of data on revenue forgone or questions about the extent to which they may properly be regarded as wholly Industry Assistance'. These provisions include the concession whereby primary producers are allowed to adopt artificially low values for natural increase in their livestock accounts for taxation purposes; drought bonds and income equalisation deposits; and the accelerated depreciation of expenditure on employees' amenities. The averaging provisions applied to primary producers are also not included. Taxpayers to whom these provisions apply are assessed on their taxable incomes for the current year at rates of tax corresponding to the average of their incomes for the current year and the preceding four years. One effect of the provisions, which is an intended effect, is to ensure that *fluctuations* in income in conjunction with progression in rates of tax do not lead to those taxpayers bearing higher tax rates than other taxpayers having incomes which, over a period of years, are comparable but nonfluctuating. The effects go beyond that when there is an upward trend in incomes over a number of years and, even if there are fluctuations in income superimposed on that trend, the averaging provisions can result in the taxpayers covered by them bearing lower tax rates than other taxpayers whose incomes over a period of years are comparable. Under the new personal income tax system to apply from 1 February 1978, with no more than the standard tax rate of 32 per cent applying to taxable incomes up to $16 000 (the ceiling for the application of averaging), the unintended effects of averaging will not arise. The new arrangements are described in Statement No. 4. {: type="a" start="a"} 0. The investment allowances for manufacturing and primary industry, special deductions equal to 20 per cent of the cost of certain plant, were withdrawn in respect of expenditure on or after 22 August 1973 unless incurred under a contract entered into before that date. The new general investment allowance which applies to plant purchased on or after 1 January 1976 is a deduction generally equal to 40 per cent of the cost of the new plant and applies to a wider range of plant (including leased plant). 1. The export market development rebate was withdrawn in respect of expenditure incurred on or after 1 July 1974. 2. Special deductions (Section 75a) are allowed to taxpayers engaged in primary production in respect of certain classes of capital expenditure not subject to depreciation by which the amount of the expenditure is allowed in equal annual instalments over 10 years. 3. Development expenditures by general mining and petroleum mining companies are now deductible on a diminishing value basis by reference to a maximum life of mine or field of 5 years. Expenditure on facilities for the transport of minerals is deductible in equal instalments over either 10 years or 20 years, at the taxpayer's option to be exercised with the first claim for the deduction. However, some expenditure is deductible under provisions of earlier years which continue to apply to expenditure made in those earlier years. 4. Taxpayers were allowed to claim deductions for depreciation in respect of certain plant that was used in manufacturing or primary production at twice the rates of depreciation normally provided. Eligible plant was that installed on or after1 July 1974 and before 1 July 1975 of a kind that would have qualified for the 20 per cent investment allowance under Sections 62aa and 62ab if the investment allowance had not been terminated. Plant and equipment that continued to attract investment allowance by reason of its purchase under a contract signed before 22 August 1973 was not eligible for double depreciation. Double depreciation applied to a wider range of items of plant and equipment purchased and installed in the period 1 July 1975 to 30 June 1976. Normal depreciation applies in respect of plant first used or installed after 30 June 1976. 5. This estimate is based on the deductions allowable in the 1975-76 income year in respect of purchases and appropriations in that year (net of amounts included in the 1975-76 assessable income in respect of appropriations made in the previous year) *less* the depreciation that would have been allowable in that year on the relevant plant purchases or the plant in respect of which the appropriations were made. While the provisions in question do not allow any greater total deduction over the life of the plant and equipment than do the normal depreciation provisions of the income tax law, they result in a deferment of tax which involves a cost to the Budget and a benefit, namely the provision of interest-free finance, to the taxpayers concerned. Normal depreciation allowances are designed to allow taxpayers to write off the cost of plant and equipment against income as the plant and equipment is used up in producing that income. The value of accelerated depreciation allowances to taxpayers depends on how much sooner they receive savings than would be the case if the allowances had been based on the usage of plant and equipment, and on the value to them of having the use of these savings. Where there is a constant or increasing rate of investment in plant and equipment subject to accelerated depreciation, the concession virtually provides the taxpayers concerned with a revolving or increasing credit in their account with the taxation revenue. {: type="A" start="D"} 0. LABOUR AND EMPLOYMENT Outlays under this heading provide for various programs relating to immigration, occupation training schemes, the prevention and settlement of industrial disputes and the enforcement of industrial awards and agreements. Outlays are estimated at $258.3 million in 1977-78, an increase of $15.6 million over 1976-77. {:#subdebate-68-195} #### Conciliation and Arbitration Provision is made for expenditure of $5.3 million in 1977-78. The reduction of $0.4 million on 1976-77 expenditure reflects the effect of the replacement of the Industrial Court by the Federal Court ($0.9 million), partially offset by increases in costs of advertising elections of registered organisations and other administrative costs. {:#subdebate-68-196} #### Industrial Relations Bureau The Conciliation and Arbitration Act was amended in June 1977 to provide for the establishment of the Industrial Relations Bureau to facilitate the general supervision and observance of federal industrial law; $1.6 million has been provided for administrative and operational expenses of the Bureau in 1977-78. {:#subdebate-68-197} #### Payment to Stevedoring Industry Under existing legislation levies are collected from employers in the industry and passed on to the Stevedoring Industry Authority to pay attendance money and leave benefits to waterside workers, and to reimburse employers for pension and redundancy payments. The reduction of $18.5 million in the estimate for 1977-78 reflects proposed legislative changes. It is proposed that from 31 December 1977, when present legislation expires, responsibility be transferred to the stevedoring industry itself for some of the payments presently funded through the Stevedoring Industry Authority. A lesser scale of levies will consequently apply to meet the remaining payments which will continue to be funded through a new body to be called the Stevedoring Industry Finance Committee. {:#subdebate-68-198} #### Apprenticeship Training Commonwealth assistance for apprenticeship training is intended to promote apprenticeship opportunities, to improve the standard of training of apprentices in industry and to increase the future supply of skilled tradesmen. An extensive review of apprenticeship training during 1976-77, which involved the States, the National Training Council and major employer and employee organisations, resulted in the introduction of a new scheme - the Commonwealth Rebate for Apprentice Full-Time Training (CRAFT) - to replace the National Apprenticeship Assistance Scheme (NAAS). CRAFT became operative on 15 January 1977. It provides encouragement to employers to increase their apprentice intake by compensating them with tax-exempt rebates for the costs of releasing apprentices to attend (or to study for) basic trade courses provided by technical education institutions in any year of apprenticeship, or to attend full-time, off-the-job training courses in their first three years of apprenticeship. Rebates are set at $11 per day for apprentices attending stages 1 and 2 of a basic trade course, increasing to $15 per day for stages 3 and 4, if not completed in the first year. Full time off-the-job training rebates of S5.50 per day are payable to employers for a maximum of 260 working days. Both rebates are indexed annually to take account of movements in wages. Weekly living-away-from-home allowances, of SI 7.60 for first year apprentices, and $6.80 for persons in the second year of their apprenticeship, may also be provided. These allowances are not tax exempt. Provision has been made for the training of 40 000 apprentices under CRAFT in 1977-78, at an estimated cost of $22.3 million. Employers of apprentices taken on after 15 January 1977 are not eligible for assistance under NAAS. However, residual NAAS payments in 1977-78 are estimated to cost $14.8 million, a reduction of S24.7 million on expenditure in 1976-77. An amount of $7.3 million is provided for the award costs of apprentices, surplus to normal requirements, who are undergoing the full term of their training in Commonwealth and State Government establishments. Apprenticeship training supervisors subsidised in State Government employment are estimated to cost the Commonwealth $54 000 in 1977-78; this scheme is to be terminated in 1977-78. The Commonwealth has increased the number of places for apprentices in Commonwealth Departments under the Group Partial Training Scheme from 75 to 275 in 1 977. Under this Scheme, apprentices sponsored by private employers are given full-time training in Commonwealth Government Departments for the whole of the first year. The costs (including wages) of this training are met in full by the Commonwealth. At the end of the first year the apprentices commence work with their employers. The cost of the scheme in 1977-78 is estimated to be $1.3 million. {:#subdebate-68-199} #### Employment Training Schemes The National Employment and Training System (NEAT) provides full or parttime training allowances, living-away-from-home and book and equipment allowances, and assistance with the payment of fees and fares for trainees. Subsidies are available to employers who provide in-industry training or who release trainees for training during working hours. The 1977-78 provision for NEAT is $54.3 million compared with $31.6 million in 1976-77. This increase reflects an expected substantial increase in the numbers of trainees and the full-year cost of the new initiatives under NEAT which were introduced during 1976-77. One such initiative, the Special Youth Employment Training Program, which is estimated to cost $18 million in 1977-78, is aimed at providing employment and training for young people who have been unemployed for long periods by making available allowances to employers who provide them with on-the-job training for six months. As announced in the Budget Speech, eligibility under this latter scheme has been extended to cover persons aged up to 25 years; previously the scheme covered only persons aged between 15 and 19 years. Other programs aimed at improving the employment prospects of unemployed youth which were introduced during 1976-77 were the Pre- Apprenticeship Training Scheme and the Education Program for Unemployed Youth. The Pre-Apprenticeship Training Scheme is intended to increase opportunities for trade training by the introduction or expansion of pre-apprenticeship courses and by accelerated apprentice training in selected trades. Allowances to trainees under the program are paid from funds provided for NEAT. Overall expenditure under this scheme in 1977-78 is estimated at$4.4 million;$3.2 million is for payments to the States to conduct the courses and$1. 2 million is for payment of allowances to trainees. The Education Program for Unemployed Youth was established with the objective of improving the skills and motivation of young unemployed people, particularly those with low or inadequate educational qualifications. An amount of $1.5 million was provided for courses in educational institutions in the States of which $0.5 million was spent in 1976-77. The remaining $1.0 million is available for courses in 1977-78. Allowances to be paid to trainees for out of pocket expenses are estimated to cost $0.4 million in 1977-78. {:#subdebate-68-200} #### General Administration Expenditure on administration and other costs related to employment and industrial relations is estimated to increase by $11.0 million to $75.4 million in 1977-78. This rise reflects increases in wage, salary and other costs, and in staff numbers during 1976-77. {:#subdebate-68-201} #### Immigration Program The Government has decided not to set a specific immigration program for 1 977-78 but to determine in-take on the basis of numbers of applicants in the currently eligible categories. Eligibility will continue to be based on family reunion, refugee status and on the possession of specific skills in short supply in Australia. On the basis of present application rates, the number of migrant arrivals in the current year could be expected to be much the same as the 70 500 recorded in 1976-77. {:#subdebate-68-202} #### Assisted Migration Assisted passages will be available for some 16 000 people in 1977-78, about the same number as in 1976-77. Expenditure on assisted migration is estimated at $13.2 million in 1977-78, a marginal reduction on expenditure in 1976-77. The reduction reflects, in the main, the rationalisation of transitory accommodation provided for assisted migrants. The main components of the assisted migration program in 1977-78 are embarkation and passage costs ($6.4 million) and transitory accommodation ($6.3 million). {:#subdebate-68-203} #### Administration Administrative expenditure in 1977-78 of the Department of Immigration and Ethnic Affairs is estimated at $23. 8 million, an increase of$2.2 million on 1976-77. This mainly reflects increases in salary and other costs. {:#subdebate-68-204} #### Recoveries Contributions by assisted migrants towards passage costs are estimated to total $1.1 million in 1977-78, compared with$1.0 million in 1976-77. {: type="A" start="E"} 0. OTHER ECONOMIC SERVICES This residual group covers economic services which are not readily categorised elsewhere. Outlays on these various services in each of the past two years, and estimates for 1977-78, are summarised in the following table. {:#subdebate-68-205} #### Economic and Trade Regulation The outlays under this heading relate very largely to the operations of the authorities listed. The amounts provided for 1977-78 allow for about the same staff levels, and similar levels of activity, as in 1976-77. {:#subdebate-68-206} #### Specialised Activities The Bureau of Meteorology's activities are to be held to the same levels as in 1976- 77 pending completion of the examination of the recommendation of the Committee of Inquiry into the Bureau. Recoveries are estimated at SI 3.3 million in 1977-78 and consist of receipts of the Bureau from provision of its specialist services. {:#subdebate-68-207} #### General Administrative and Other Expenditures These outlays are for the operating costs of the Departments of Overseas Trade, Business and Consumer Affairs, National Resources, Productivity and the recently established Department of the Special Trade Negotiator. The amounts provided for 1977- 78 reflect a small decrease in average staff numbers for these departments compared with 1976-77. {: type="1" start="9"} 0. GENERAL PUBLIC SERVICES This broad functional heading covers a range of general public services and activities concerned with the organisation and operation of the Commonwealth Government, including legislative services, administrative services, the maintenance of law and order and foreign affairs and overseas aid. {: type="A" start="A"} 0. LEGISLATIVE SERVICES Estimates of outlays on legislative services in 1977-78 are shown in the following table; these outlays are estimated to increase by$8.4 million, or 13.2 per cent, in 1977-78. {:#subdebate-68-208} #### Parliamentary Expenditure - Other Provision is made in 'Other' for salaries, administrative costs and capital works associated with the functioning of Parliament; costs relating to State and Electorate Offices of Senators and Members are also included here. Of the total increase of $4.2 million, $1.6 million relates to additional costs of salaries and allowances and $0.7 million relates to parliamentary printing costs. An amount of $0.6 million is included for minor capital works for Parliament House. {:#subdebate-68-209} #### Northern Territory - Legislative Assembly This item includes funds totalling $3.9 million for furniture, fittings, repairs, maintenance, buildings and works for the Northern Territory Legislative Assembly. The increase reflects a substantial carryover of expenditure on work commenced in 1976-77. {:#subdebate-68-210} #### Australian Electoral Office This item reflects the administrative costs of maintaining electoral rolls and conducting Commonwealth elections and referenda. Outlays in 1976-77 reflected the May 1977 referenda and national song poll. The estimates for 1977-78 include provision for a half Senate election. Salaries for the Australian Electoral Office are estimated to increase by $1.1 million, reflecting increased staff numbers and the full year effects of wage and salary determinations made in 1976-77. {: type="A" start="B"} 0. LAW, ORDER AND PUBLIC SAFETY Commonwealth outlays on law, order and public safety are estimated to total SI 36.4 million in 1977-78, an increase of SI 0.7 million over 1976-77. Actual outlays in the two years to 1976-77, together with estimates for 1977-78, are shown in the following table. {:#subdebate-68-211} #### Courts and Legal Services {:#subdebate-68-212} #### Federal Court As a result of the Government's decision to rationalise the structure of federal courts, a single Federal Court of Australia was created on 9 December 1976. The Federal Court of Australia has appeal functions and replaces the Federal Court of Bankruptcy and the Australian Industrial Court. The new arrangement recognises and enhances the position of the State Courts by giving those Courts powers in important fields of law not previously open to them. SI. 6 million is provided for the estimated operating costs of the Court in 1977-78. {:#subdebate-68-213} #### High Court An amount of $8.5 million is being provided in 1977-78 toward construction of the new High Court building in the Australian Capital Territory. A further $1.5 million is provided to cover estimated running costs of the High Court in 1977-78. {:#subdebate-68-214} #### Commonwealth-State Law Courts This provision is for the Commonwealth's share of approximately 45 per cent of the construction costs of a court complex in Sydney being built jointly with the State of New South Wales. The complex is now scheduled for completion in 1977-78. {:#subdebate-68-215} #### Australian Law Reform Commission The Commission deals with the systematic development and reform of the law, including its modernisation and simplification, the elimination of defects, and the adoption of new or more effective methods for administration and the dispensation of justice. {:#subdebate-68-216} #### Legal Aid Legal Aid arrangements are currently under review. Legislation establishing a Commonwealth Legal Aid Commission has been passed and the Ordinance establishing the Legal Aid Commission (ACT) was proclaimed on 11 July 1977. Both these Commissions are expected- to commence operations in 1977-78. Legislation to establish Legal Aid Commissions in Western Australia and South Australia has been passed by the respective States and discussions are proceeding between the Commonwealth AttorneyGeneral and other States with a view to establishing Commissions in those States. A Legal Aid Commission is also projected for the Northern Territory. {:#subdebate-68-217} #### Family Law *The Family Law Act* 1975 established the Family Court of Australia, the Family Law Council and the Institute of Family Studies. The bulk of expenditures under this item relate to the operations of the Family Court and payments to the State of Western Australia for the operation of its Family Court. The allocation of $10.3 million in 1977-78 provides for a significant increase in the size of the Family Court of Australia. {:#subdebate-68-218} #### Protection of Human Rights The Government proposes to establish a Human Rights Commission that will examine complaints of infringements of the International Covenant on Civil and Political Rights. The nature and function of the Commission are being determined in consultation with the States and it is planned that the Commission will be established as part of a Commonwealth-State Scheme for the maintenance of human rights. The Commission is expected to commence operations in 1977-78 and will incorporate the activities of the Commissioner for Community Relations. {:#subdebate-68-219} #### Police, Security and Detention The cost of providing police and prison services in the Australian Capital Territory is estimated to be SI 1.9 million in 1977-78. Estimated expenditure for the Commonwealth Police Force is $28.7 million. Consequent on the transfer of administrative responsibilities to the Northern Territory Legislative Assembly from 1 July 1 977, police and prison services in the Northern Territory (S10.7 million in 1976-77) are now funded from within the global allocation to the Assembly which is classified under the heading General Administration. {:#subdebate-68-220} #### Attorney-General's Department The main components of the increase of S2.8 million are S1.0 million for salaries, $0.8 million for publications of Commonwealth Acts and Rules, S0.2 million for computer costs associated with the computerised. Legal Information Retrieval and Publication System, and SO. 4 million for the first full year share of running expenses of the joint Commonwealth-State Law Courts building in Sydney. {:#subdebate-68-221} #### Public Safety and Protection The Commonwealth is providing $0.8 million in 1977-78 for road safety promotion and research and a grant to the States of $0.15 million for promotion of road safety practices. {: type="A" start="C"} 0. FOREIGN AFFAIRS AND OVERSEAS AID This section covers most of the expenditures undertaken by the Commonwealth Government in relation to policies designed to promote relations with foreign countries and external territories and to assist in the economic and social development of developing countries. Total outlays on foreign affairs and overseas aid are estimated to increase by $54.7 million to $571.3 million in 1977-78. About three quarters of this expenditure relates to various overseas economic aid programs to assist developing countries, including Papua New Guinea. A detailed statement of Australia's aid programs is given in the accompanying Budget Paper entitled *Australia's Official Development Assistance to Developing Countries* 1977-78. {:#subdebate-68-222} #### Aid Payments An amount of $425.8 million is provided for expenditure on overseas aid in 1977-78, an increase of $45.7 million or 12.0 per cent over 1976-77. This increase is spread between bilateral aid programs ($17.4 million) and multilateral aid programs ($28.3 million). Taking into account 'Assistance Additional to Aid Payments' (see below) total assistance to developing countries in 1977-78 is estimated to amount to about $460 million. This figure does not, however, include significant amounts spent by the Commonwealth and State Governments on the education and training of several thousand students from developing countries who are attending various tertiary and other training institutions in Australia. The annual cost to the Australian taxpayer of providing assistance of this kind, not brought to account directly under the overseas aid program, is estimated at about $26 million. Australia also provides other indirect forms of economic aid through its contributions to the regular budgets of a number of international organisations (e.g. United Nations Organisation, the Food and Agriculture Organisation and the World Health Organisation) that assist in the financing of aid projects in developing countries, and through the activities of the Export Finance and Insurance Corporation (EFIC). The Government, in the national interest, has assumed large contingent liabilities in relation to developing countries through its support of EFIC activities in export and investment insurance. Since February 1975 EFIC has also operated a facility to finance exports of capital goods, with concessional terms provided, if necessary, especially to developing countries. {:#subdebate-68-223} #### Bilateral Aid {:#subdebate-68-224} #### Papua New Guinea An amount of $223.4 million is provided for expenditure on aid to or on behalf of the Papua New Guinea Government in 1977-78, $4.9 million less than in 1976-77. Under the terms of an aid agreement announced in March 1976 Australia is to provide to Papua New Guinea, in annual instalments, a minimum grant of $930 million as general budgetary assistance over the five years commencing 1976-77. In 1977-78 the amount to be paid in accordance with the terms of this commitment is $200 million, an increase of $10 million over 1976-77. Expenditure on the provision of assistance under the Australia-Papua New Guinea Education and Training Scheme is estimated to increase by $0.5 million to $1.6 million in 1977-78. The decline in total expenditure on aid to Papua New Guinea in 1977-78 is due to a run-down in payments in respect of termination and retirement benefits payable to expatriate officers of former PNG Administrations and the Australian Staffing Assistance Group ($19.5 million) and to a tapering off in expenditure on upgrading civil aviation facilities at Port Moresby and Nadzab which are nearing completion ($1.6 million). {:#subdebate-68-225} #### Bilateral Projects The Development Assistance Fund, under which expenditures on bilateral projects have been funded in recent years, was abolished at the end of 1976-77 following the establishment of the Australian Development Assistance Bureau within the Department of Foreign Affairs. Expenditure on bilateral projects will now be funded by normal appropriation procedures, as was the practice prior to establishment of the Development Assistance Fund. Expenditures on bilateral projects are estimated to increase substantially to $71.0 million in 1977-78, an increase of $18.9 million on 1976-77. This reflects a substantial increase in Australian aid commitments to South Pacific countries, an expanded aid commitment to Indonesia and increased aid for other member countries of the Association of South East Asian Nations (ASEAN). The expenditures embrace a diversity of activities including projects, equipment and expert advice directed towards increasing agricultural productivity, providing general infrastructure and improvements in transport and communication facilities. These commitments reflect the Government's policy of concentrating its aid program in developing countries in Australia's immediate region. {:#subdebate-68-226} #### Training Expenditure on training programs (excluding training provided under the Australia-Papua New Guinea Education and Training Scheme) is estimated at SI 6.6 million in 1977-78, an increase of $2.7 million on 1976-77. The increase mainly reflects increased costs, rather than expanded levels of activity. Under the various programs (for example, the Colombo Plan and the Commonwealth Co-operation in Education Scheme) funds are provided for academic training, of nationals of developing countries, for short courses to meet special needs (especially in specialised technical areas), for on-the-job training opportunities, and for third country and in-country training awards. In addition, funds are provided for the Australian-Asian Universities Co-operation Scheme, whereby selected universities in Indonesia, Malaysia and Singapore receive assistance from Australian universities in the form of equipment, provision of experts and fellowships for Asian academics to train in Australia. {:#subdebate-68-227} #### Food Aid Expenditure on food aid is estimated to increase by SI. 9 million to S26.6 million in 1977-78. This expenditure allows for a substantial increase, in real terms, in Australia's food aid commitments. Given the substantial fall in the price of wheat, the major commodity supplied under the program, the real increase is not reflected in money outlays. **Major new** commitments in 1977to78 entail an increase in the total quantity of wheat (or wheat equivalent) Australia supplies under the provisions of the Food Aid Convention of the International Wheat Agreement, provision of funds to cover freight costs on food aid provided in connection with a newly created bilateral reserve for emergencies occurring in needy countries, and provision of non-grain foods (e.g. skim milk powder) to developing countries. Australian food aid to the World Food Program is included under the heading 'United Nations Programs'. {:#subdebate-68-228} #### Other Bilateral Support for voluntary aid organisations is estimated to increase from S0.6S million in 1976-77 to $1,625 million in 1977-78, reflecting the Government's increased support for the activities of voluntary aid organisations. Expenditure under this heading includes grants for the Overseas Service Bureau and the Australian Council for Overseas Aid, and direct financial support for small-scale development assistance projects carried out by voluntary aid organisations in developing countries. An amount of $0.7 million is included for expenditure on disaster relief. {:#subdebate-68-229} #### Multilateral Aid Under multilateral aid programs the Commonwealth provides support to a wide range of international organisations, including development finance institutions, United Nations agencies and various regional organisations. Expenditure in 1977-78 is estimated to increase by $28.3 million, or 49.4 per cent on last year. {:#subdebate-68-230} #### United Nations Programs Payments by Australia to aid agencies and organisations established under the aegis of the United Nations are expected to increase to $16.5 million in 1977-78. Significant increases are planned in respect of Australia's support for the World Food Program, the United Nations Development Program, the United Nations Children's Fund, the United Nations High Commissioner for Refugees and the United Nations Fund for Population Activities. There is an increase of $3.5 million in 1977-78 in the provision for estimated expenditure under the World Food Program. The increase is due partly to Australia's commitment to progressively increase to 20 per cent the proportion of food grain aid channelled through this Program, in addition to its biennial pledge of cash and commodities (other than wheat). Australia's contributions to the United Nations High Commissioner for Refugees include an amount of $1 million for the appeal on behalf of displaced persons from Indochina in Thailand and other Asian countries. {:#subdebate-68-231} #### Regional and Other International Programs Total assistance to regional and other international programs is expected to increase by $4.9 million to $12.1 million in 1977-78, in line with the Government's policy of supporting major regional and international aid organisations. **Major regional** organisations to receive increased support include the Association of South East Asian Nations, the Economic and Social Commission for Asia and the Pacific, the South Pacific Commission and the South Pacific Bureau for Economic Co-operation. In addition, increased assistance is planned for the Commonwealth Fund for Technical Co-operation, the Consultative Group for International Agricultural Research and Regional Education and Training Projects. Provision is also made for an amount of $1 million in 1977-78 for South Pacific Regional Programs to enable aid to be provided through multilateral channels to regional or individual country projects in that region. {:#subdebate-68-232} #### International Development Finance Institutions Total payments by Australia to the Asian Development Bank, the World Bank Group, the International Monetary Fund and the International Fund for Agricultural Development are expected to increase from $40.4 million in 1976-77 to $57.0 million in 1977-78. These expected payments include calls on Australia in accordance with previously announced commitments to those institutions. There is also provision for payments in respect of Australia's subscription to the second capital increase of the Asian Development Bank ($3.1 million) and maintenance of value obligations in respect of Australia's contributions to the International Development Association and capital subscriptions to the Asian Development Bank ($9.0 million). An amount of $2.2 million is provided in respect of estimated payments in 1977-78 to the International Fund for Agricultural Development. Legislation to authorize Australia's membership of this Fund and payment of a contribution of $8 million over a period of not less than three years was introduced in Parliament in May 1977. There is also provision for expected payments of$2.5 million to the International Monetary Fund's Oil Facility Interest Subsidy Account (which has been established to reduce the cost to certain developing countries of borrowings from the Fund's Oil Facility). {:#subdebate-68-233} #### Assistance Additional to Aid Payments Although Australia's Defence Co-operation program ($25.9 million in 1977-78) represents an extension of our own defence effort, it also supplements the Government's overseas economic aid programs to the extent that it releases for development purposes resources that recipient Governments would otherwise have set aside for defence purposes. Australia's assistance in this respect is referred to in the section on Defence Co-operation under Defence. In addition, the administrative expenses of the Australian Development Assistance 'Bureau, estimated at$8.3 million for 1977-78, are associated with Australia's aid effort. {:#subdebate-68-234} #### Cocos (Keeling), Christmas and Norfolk Islands Included under this heading are the costs involved in administering these three small external territories. The increased amount provided for in 1977-78 reflects in part increasing expenditure on capital works committed in earlier years for both the Cocos (Keeling) Islands and Christmas Island. Membership of International Organisations and Other Non-aid Expenditure Expenditure under this item arises from Australia's membership of many global and regional organisations. Active participation in such organisations is an integral part of Australia's foreign policy and entails financial contributions to the administrative expenses and, in some cases, the functional activities of the organisations in question. Total expenditure under this item in 1977-78 is estimated to reach S20.2 million, an increase of $2.1 million over 1976-77. The major items include $4.7 million for the United Nations Organisation, $1.4 million for the Food and Agriculture Organisation, $1.5 million for the United Nations Education, Scientific and Cultural Organisation, $1.1 million for the International Labour Organisation, $2.1 million for the World Health Organisation, $1.3 million towards the cost of the United Nations Emergency Force in the Middle East and $1.2 million for the Organisation for Economic Cooperation and Development. There is also provision for an amount of $1.8 million towards the cost of implementation of Australia's independence gift to Papua New Guinea of a National Library. {:#subdebate-68-235} #### General Administrative Expenses Included in this item are the administrative costs of the Department of Foreign Affairs, the Australian Development Assistance Bureau and the Overseas Operations Branch of the Department of Administrative Services. Expenditure in 1977-78 is estimated to increase by $6.1 million, to $130.4 million. {: type="A" start="D"} 0. GENERAL AND SCIENTIFIC RESEARCH NEC The Government provides funds for a variety of scientific, industrial and general research purposes but much of this is recorded under the appropriate functional headings (e.g., Health, Education, etc.). 'General and Scientific Research (not elsewhere classified)' covers the activities of the Commonwealth Scientific and Industrial Research Organisation, the Australian Atomic Energy Commission and a number of specific programs of research undertaken by several Government departments and instrumentalities, assistance for research activities funded through the Australian Research Grants Committee, support for academic institutions, and various fellowship schemes. Expenditure for 1977-78 is estimated at $196.0 million, an increase of $10.8 million on 1976-77. {:#subdebate-68-236} #### Australian Atomic Energy Commission The Commission's functions include research and investigation into matters associated with uranium and atomic energy, and the production and sale of radio-isotopes. (Outlays relating to uranium exploration and development are included under "Industry Assistance and Development"). Expenditure by the Commission is estimated at $21.7 million for 1977-78, $0.9 million greater than in 1976-77. {:#subdebate-68-237} #### Commonwealth Scientific and Industrial Research Organisation Expenditure by CSIRO relates to activities in the fields of agricultural, biological, industrial and physical research, together with the provision of research services and facilities and support for research associations. The operations of the CSIRO are currently under review by an independent committee of inquiry. Pending the outcome of the enquiry the Organisation's activities are being maintained at around the same real levels as in 1976-77. The increase of $12.0 million in the provision for CSIRO in 1977-78 represents the net effect of an increase of $8.4 million in the cost of ongoing research programs, provision of an additional $4.4 million for wool research resulting from a reorganisation of methods of financing, and a decrease of $0.9 million in the building and works program. {:#subdebate-68-238} #### Antarctic Division The Antarctic Division administers, organises and provides logistic support for the Australian National Antarctic Research Expeditions (ANARE). These expeditions operate from four stations in the Antarctic region and conduct scientific research programs in upper atmosphere physics, cosmic ray physics, glaciology, biology, medical science, geology and geophysics. For 1977-78, $8.7 million has been provided, an increase of $2.1 million on 1976-77. This increase includes provision for a design study for an Australian-owned Antarctic ship ($0.05 million) and initial development of a marine research program in the Antarctic ($0.03 million). {:#subdebate-68-239} #### Research Grants Assistance is provided through the Australian Research Grants Committee (ARGC) the Queen Elizabeth II Fellowship Scheme and the Queen's Fellowship Scheme for research projects by individuals in the humanities and social sciences, in the physical, chemical, biological and earth sciences, in engineering and applied sciences and in marine science. Grants by the ARGC make up the bulk of research assistance provided. The 1977-78 provisions total $1 1.1 million, a decrease of $1.1 million on expenditure in 1976-77. The 1976-77 figure, however, included $2.1 million in payments to Universities to reimburse them for costs incurred in interim support of ARGC programs in 1975-76. The provisions will permit ARGC programs to be maintained in 1977-78 at much the same real levels as in 1976-77. {:#subdebate-68-240} #### Australian Institute of Marine Science The Australian Institute of Marine Science was established in 1972 to conduct studies in marine science and to co-ordinate and develop marine science in Australia. Initially, the work of the Institute is being directed to studies of the Great Barrier Reef, the Coral Sea and the coast and adjacent waters of North Queensland. The Institute is now occupying its recently completed permanent laboratory complex at Cape Ferguson, constructed at a total cost of $12.8 million. The overall provision for the Institute in 1977-78 is $4.2 million, which is $3.8 million less than was spent in 1976-77. The decrease reflects the completion of the permanent laboratory building, for which S5.9 million was provided in 1976-77, partly offset by estimated outlays of SI. 2 million in 1977-78 for the construction of a 24 metre research vessel. {:#subdebate-68-241} #### Anglo-Australian Telescope Board This item provides for the Australian Government's contributions to the operational costs of the Anglo-Australian Telescope sited near Coonabarabran in N.S. W. The total cost of operations in 1977-78, which is to be shared equally with the U.K. Government, is estimated at SI. 7 million. {:#subdebate-68-242} #### Australian Institute of Aboriginal Studies The Australian Institute of Aboriginal Studies was established in 1964 to promote, encourage and assist studies and research in relation to the Aboriginal people. The work of the Institute includes the identification, recording and preservation of sites that are of special significance to Aboriginals, the collection of Aboriginal music, folklore and language, and research into the interaction between Aboriginals and Europeans. The provision for the Institute in 1977-78 is $2.0 million. {:#subdebate-68-243} #### Other Research and Science Expenditure under this heading covers support for a number of scientific and research activities. Among these is support for the Australian Academy of Science and the Australian Science and Technology Council. Funds are provided for activities under the auspices of several agreements for scientific and technological co-operation with other countries. Funds for the support and development of major scientific facilities in Australia are also included under this heading. Examples include the Nuclear Magnetic Resonance Spectrometer ($0.09 million in 1977-78), the Balloon Launching Station ($0.22 million in 1977-78), and scientific installations operated under arrangements with U.S. agencies. Provision of $0.14 million has also been made for initial work that will lead to direct Australian participation in the LANDSAT program. An amount of $0.55 million is provided for further specific research in 1977-78 on the development of the Australian Microwave Landing System (InterScan). {: type="A" start="E"} 0. ADMINISTRATIVE SERVICES Included under this heading are general administrative services not allocated to specific functions, as well as some common services. These outlays are estimated to total$855.6 million in 1977-78, an increase of $131.1 million. {:#subdebate-68-244} #### Financial Affairs and Fiscal Administration Funds to be provided in 1977-78 total$278.2 million, an increase of$23.2 million on 1976-77. The increases here mainly reflect rises in wages and salaries. Comparison of the 1977-78 estimates for Treasury nec and Finance with figures for earlier years are affected by classification changes arising from the creation of the Department of Finance in December 1976. {:#subdebate-68-245} #### Statistical Services This provision is essentially for expenditure involved in the operations of the Australian Bureau of Statistics. There is an estimated increase of$7.6 million in salary costs in 1977-78; this is largely offset by reductions in administrative costs associated with the 1976 population census. Allocation to the Northern Territory Legislative Assembly The provision is to cover expenditure on functions for which executive responsibility was transferred to the Northern Territory Legislative Assembly on 1 January 1977. This transfer of functions is the first stage of the devolution of powers leading to self-government for the Territory and its eventual statehood. The disbursement of this provision will be determined by Funds Allocation Ordinances of the Northern Territory Legislative Assembly. These Ordinances will, inter alia, allocate funds for the Northern Territory Housing Commission, Police, Primary Producers Board, and for other responsibilities previously classified under the relevant functional headings. Other General Administration of the Territories This item includes outlays in the Australian Capital Territory (S28.8 million) and the Northern Territory ($36.8 million) on services which are of a general nature and cannot be readily classified to other functions (e.g. city works undertaken by the NCDC in Canberra, and general salaries and administrative expenses of the Departments of the Capital Territory and the Northern Territory) . Other Administrative Services nec **Major items** in this category include the administrative expenses of the Department of Prime Minister and Cabinet, the Department of Science and the Department of Administrative Services. Expenditures related to the running costs of the Administrative Appeals Tribunal and the Office of the Commonwealth Ombudsman are also included. The Tribunal, which came into operation on 1 July 1976, is empowered to hear appeals against certain classes of administrative decisions. {:#subdebate-68-246} #### Common Services {:#subdebate-68-247} #### Construction Services (Net) Outlays under this heading are mainly for the running costs of the Department of Construction, including salaries, administrative expenses and consultants' fees. The major factor responsible for the increase under this item is higher salary costs. {:#subdebate-68-248} #### Commonwealth Offices This heading covers funds provided for the construction and maintenance of Commonwealth Offices. The declining trend of these expenditures is expected to continue in 1977-78 in line with the continuing policy of restraint on public service staff numbers. Expenditures on new Commonwealth Offices in the ACT, which make up the bulk of this item, are estimated to decline by $3.4 million in 1977-78. {:#subdebate-68-249} #### Property Management and Services Provision is made here for the services necessary to manage Commonwealth office accommodation and the survey program. **Major components** of the estimate are salaries ($18.5 million), contract cleaning ($7.1 million) and office services (S9.4 million). {:#subdebate-68-250} #### Government Purchasing The main component of the estimate for 1977-78 is salaries ($9.1 million) for staff of the Department of Administrative Services engaged in purchasing activities. {:#subdebate-68-251} #### Rent This item reflects the rental costs for office and other accommodation leased for civil departments. The full year cost of leases taken up in 1976-77, increased rentals on existing leases, and proposed expenditure of $1.5 million on new leases in 1977-78, account for the increase of $5.0 million. {:#subdebate-68-252} #### Publishing and Publicity Expenditure under this item includes provisions for the operations of the Australian Government Publishing Service and publicity programs undertaken by the Australian Information Service (totalling $4.1 million) and support for Film Australia$3.6 million). {:#subdebate-68-253} #### Storage and Transport Services Expenditure under this heading includes removal and storage costs associated with the transfer of Commonwealth civilian employees and the provision of bulk storage facilities for other than the Defence Department. {:#subdebate-68-254} #### Net Superannuation Payments The increase of $30 million estimated for 1977-78 provides for growth of about 3 per cent in the number of pensioners and reflects the full year cost of new pensions granted in 1976-77 and the cost of automatic updating of pensions in July 1977. {:#subdebate-68-255} #### Recoveries This classification records various miscellaneous receipts, the main components being administrative charges for work undertaken by the Department of Construction for certain clients (e.g., Postal and Telecommunications Commissions, Reserve and Commonwealth Banks), revenue from the sale of Government publications, film sales and royalties, rent from Commonwealth property, survey fees levied by the SurveyorGeneral, and numerous other minor charges. {: type="1" start="1"} 0. NOT ALLOCATED TO FUNCTION Outlays not allocated to specific functions comprise payments to the States and local government authorities not elsewhere classified in this Statement, natural disaster relief, interest payments on the public debt, and an allowance of$90 million for increases in wages and salaries for Commonwealth Government employees and the defence forces. {: type="A" start="A"} 0. PAYMENTS TO OR FOR THE STATES AND LOCAL GOVERNMENT AUTHORITIES NEC AND NATURAL DISASTER RELIEF Outlays under this heading comprise general revenue funds for the States, State Government Loan Council programs, assistance related to State debt, certain forms of financial assistance for local government and outlays for natural disaster relief. Details of the payments are set out below; additional information on these and other payments to the States and local government authorities classified under various functional headings is contained in the Budget Paper entitled *Payments to or for the States and Local Government Authorities, 1977-78.* {:#subdebate-68-256} #### General Revenue Funds General revenue funds are utilised for purposes determined by the States. Financial assistance grants, which made up most of these funds up to and including 1975-76, were determined under a formula which took into account the percentage increases in State's populations and in average wages in the economy as a whole, and a further betterment' factor. Financial assistance grants were replaced by personal income tax sharing arrangements between the Commonwealth and State Governments in 1976-77. Under 'Stage 1' of these arrangements, the States are entitled to 33.6 per cent of Commonwealth net personal income tax collections, excluding the revenue effects of any special surcharges or rebates applied by the Commonwealth. Overpayments in a year are deducted from payments in the following year. Under 'Stage 2', for which enabling legislation has been introduced into Parliament, each State will also be able, if it so chooses, to legislate to increase its revenue from personal income tax or to give, at cost to the State, a rebate on personal income tax to residents in the State. The 'Stage 1' arrangements include a guarantee that the States' entitlements in any year will not be less than in the previous year and, in the four years 1976-77 to 1979-80, will not be less in a year than the amount which would have been yielded in that year by the financial assistance grants formula referred to above. In the context of the examination of the proposal that the income tax sharing arrangements be changed to relate the States' entitlements to the preceding year's net personal income tax collections, it has been agreed that the Budget provision for the States' tax sharing entitlements in 1977-78 should be the amount of $4336.1 million conditionally offered by the Prime Minister at the 1 July 1977 Premiers' Conference, rather than 33.6 per cent of estimated net personal income tax collections in 1977-78. Special grants are paid on the recommendations of the Grants Commission; each of the four less populous States is free to apply for them but Queensland is at present the only applicant State and payments of special grants in 1976-77 and 1977-78 relate solely to that State. Repayments under the general revenue assistance heading relate to special repayable and interest bearing advances made to New South Wales in 1971-72 and 1972-73. In total, net general revenue funds to be provided to the States in 1977-78 are estimated at S4331.3 million, an increase of $618.7 million, or 16.7 per cent, compared with 1976-77. {:#subdebate-68-257} #### State Government Loan Council Program At its July 1 977 meeting the Loan Council approved a total State Government program of $1433.8 million for 1977-78. This represents an increase of 5.7 per cent over the 1976-77 program. Of the total program $955.9 million will take the form of borrowings and $477.9 million will be by way of capital grants provided by the Commonwealth. ASSISTANCE related to state debt Under the Financial Agreement the Commonwealth pays $15.2 million each year to the States as a contribution towards interest payable on their debt and also contributes sinking fund payments. The sinking fund payments in 1977-78 are estimated to total S33.7 million. assistance for local government Under the tax sharing arrangements which commenced in 1976-77 the Commonwealth provides funds to the States for general purpose assistance to local government authorities. The amount to be provided in 1977-78 is SI 65.3 million, which represents an increase of 18.1 per cent over the amount of $140.0 million paid to the States for local government in 1976-77. {:#subdebate-68-258} #### Natural Disaster Relief An amount of SI 3.8 million is provided for expenditure on natural disaster relief in 1977-78. Of this amount $13.0 million is estimated to be required for payments to the States, primarily for outstanding payments in respect of cyclone, flood and storm damage. No allowance has been made in the estimates for payments in respect of natural disasters which may occur in 1 977-78. {: type="A" start="B"} 0. PUBLIC DEBT INTEREST This heading brings together interest payments made from the Budget sector to other sectors, including interest payments on Commonwealth securities, and under defence credit arrangements with other countries. Interest received by Government Trust Funds on Commonwealth Securities held as investments and cash balances is offset against gross-interest payments. Total public debt interest payments are estimated to increase by$3 15.7 million or 22.4 per cent and represent 6.5 per cent of total Budget outlays; in 1976-77 public debt interest payments represented 5.9 per cent of total outlays. *Gross Interest Paid on Commonwealth Securities* This item comprises interest on all Commonwealth securities on issue, except for interest on defence borrowings. The major securities issued by the Commonwealth include Bonds and Inscribed Stock, Australian Savings Bonds, and Treasury Notes. Over half the securities on issue are on behalf of the States. Reimbursement of interest payments by the States and Commonwealth Authorities are recorded as receipts under the heading Interest, Rent and Dividends. (See the relevant section in Budget Statement No. 4 for further details.) There has been a substantial increase in interest payments over recent years. High interest rates and large deficits financed as far as possible by borrowings from the public have contributed to this increase. {:#subdebate-68-259} #### Loan Defence Act Interest The decline in interest payments in 1977-78 on loans raised in the United States for defence equipment purchases reflects the declining level of that outstanding debt. {:#subdebate-68-260} #### Loan Consolidation and Investment Reserve Interest is received by the Loan Consolidation and Investment Reserve on investments in Commonwealth securities which were issued mainly in Special Loans to assist State works programs. Because these receipts represent interest paid by the Commonwealth to the Commonwealth (through one of its Trust Accounts) the interest received by the Trust Account is offset against total interest paid. The estimated reduction in interest receipts of the Reserve reflects a lower level of investments held by the Reserve following cancellation of securities. {:#subdebate-68-261} #### Other Interest is also received on investments in Commonwealth securities and on cash balances, by other Commonwealth Trust Funds, including the National Debt Sinking Fund. These transactions are also offset. {: type="A" start="C"} 0. ALLOWANCE FOR WAGE AND SALARY INCREASES A bulk allowance of §90 million is included in the Budget estimates for 1977-78 to allow for prospective increases in rates of wages and salaries in the public service during the year. The calculation of this allowance is necessarily approximate. {: .page-start } page 183 {:#debate-69} ### STATEMENT No. 4- ESTIMATES OF RECEIPTS, 1977-78 Total receipts in 1977-78 are estimated at S24 439 million, an increase of 14.3 per cent over 1976-77. This is *after* allowance for the *net* loss to revenue, estimated at $48 million, of the taxation measures announced in the Budget Speech and an estimated reduction of $1756 million in revenues in 1977-78 arising from major taxation measures introduced in 1976. {: .page-start } page 183 {:#debate-70} ### THE MEASURES The following schedule lists the Budget taxation measures and shows the estimated effects on receipts in 1977-78 and in a full year. Minor measures outside the taxation field that will affect receipts are not shown. Full year changes are the estimated effects on receipts in respect of the 1977-78 financial year had the measures applied from 1 July 1977. Measures introduced in 1976 also imply substantial costs to revenue in 1977-78. The most important of these are: indexation of personal income tax, the latest round of which, from 1 July 1977, is estimated to cost $825 million in 1977-78; a further $140 million in revenue forgone from the 1976-77 adjustment arises in 1977-78; the trading stock valuation adjustment, estimated to cost $316 million in 1977-78; and the investment allowance, estimated to cost $475 million in 1977-78, compared with $100 million in 1976-77. The following comments are in elaboration of the Budget measures. {:#subdebate-70-0} #### Changes to Personal Income Tax System A new personal income tax system will apply as from 1 February 1978. It will form the basis for: o PAYE instalment deductions from 1 February 1978; o notionally, assessment of tax on incomes derived after 1 February (the system used for assessment of *total* taxable income earned in 1977-78 will be a composite one obtained from the present system, with a weight of 7/12, and the new system, with a weight of 5/ 12) ; and o indexation to determine tax on 1978-79 incomes. The elements of the new system are as follows: {:#subdebate-70-1} #### Rate Scale The new simplified scale will have a zero rate on that part of taxable income up to $3750. A standard rate of 32 cents will apply to all parts of taxable income above $3750. Two levels of surcharge will, however, set the effective marginal rates at 46 cents on taxable income from $16 001 to $32 000, and at 60 cents on taxable income above $32 000. The present and proposed scales of tax rates are: The minimum taxable income subject to tax, at present effectively $3154, will be $3751 under the new system. For a taxpayer with a wholly dependent spouse the spouse rebate of$555 will result in a minimum taxable income of$5485. {:#subdebate-70-2} #### Rebates The general concessional rebate (S676 at present) will be discontinued, and replaced by a zero rate step in the rate scale. Either method accomplishes the result of freeing an initial slice of income from tax. Rebates for dependants and the sole parent rebate remain at levels applying since 1 July 1977: Zone allowance rebates also remain at levels applying since 1 July 1977: Zone A: $216 plus 25 per cent of rebates for dependants (including notional rebates for dependent children and students); Zone B: $36 plus 4 per cent of rebates for dependants. {:#subdebate-70-3} #### Rebate Declarations Under the present system, if an employee does not lodge a declaration claiming the $676 general rebate, tax is deducted at the minimum rate of 35 cents in the dollar. An employee may have only one declaration in force at any one time and a person with two or more jobs would usually lodge a declaration with his or her main employer. It is proposed that equivalent declaration arrangements be continued under the new system. People who have 'second' jobs will, usually, have income from their main job in excess of $3750 a year. Any additional income from 'second job' earnings will thus generally attract PAYE deductions at or above the 32 per cent rate. *Non-residents* Concessional allowances have been granted only to resident taxpayers. With adoption of a zero-rate on the first slice of taxable income, non-residents too will be zero-rated on the first slice of their assessed Australian taxable income. {:#subdebate-70-4} #### Trusts The following basic rules for the taxation of trustees are proposed: o for accumulating trust income to which no beneficiary is presently entitled and that is assessed under *section 99* to the trustee of a trust other than a deceased estate that is in course of administration (maximum 2 years), there will be no J tax if the income is $416 or less, there will be no zero-rating and, subject to shading-in provisions for income marginally in excess of $416, the standard rate and surcharges will apply. o for trust income of a trust other than a deceased estate, to which a child under 16 years of age at the end of the year of income is presently entitled and that is assessed under *section 98,* the same tax rules as above are to apply, but with a figure of S1040 instead of $416. o for other trust income to which a 'beneficiary who is under a legal disability is presently entitled that is assessed under *section 98,* and for income assessed under *section 99* of a deceased estate that is in course of administration (maximum 2 years), the first $3750 of taxable income will be zero-rated with the standard rate and surcharges applying to the balance. Where a beneficiary is taxed on trust income that has also been taxed to the trustee under *section 98,* the tax paid by the trustee is credited against any tax charged to the beneficiary, but no refund is made. {:#subdebate-70-5} #### Averaging for Primary Producers Under the present system, the tax payable by a primary producer is in part calculated by applying to the first $16 000 of taxable income a rate fixed by reference to 'average income' of the current and four previous years. The general rebate of $676 and other concessional rebates are allowed. Under the new system, with the role of the general rebate now to be performed by the zero rate on the scale, the tax under the averaging provisions applicable to taxable income between $3751 and $16000 will be calculated at the standard rate of 32 per cent, and the first $3750 of taxable income will attract the zero rate.. Concessional rebates will again reduce the tax payable. {:#subdebate-70-6} #### Health Insurance Levy The present basis for determining the minimum taxable income subject to levy for health insurance levy purposes, by deducting unused entitlements to the general rebate against liability to levy, will no longer be applicable after absorption of the rebate into the rate scale. However, the present relationship between the income tax threshold and the health insurance levy threshold will be continued. The shading-in rate will be 34.5 per cent (equal to the levy rate of 2.5 per cent plus the standard rate of income tax of 32 per cent) with a levy threshold of S3479. Any unused concessional rebate (e.g. the rebate for a spouse) will, as at present, be allowable against the levy. For a taxpayer with a fully dependent spouse the minimum taxable income subject to levy will be $5087. *Effects of the New System* Some of the principal effects of the new simplified system are: o Taxpayers at all income levels will gain under the new system. Examples of the gains are: o The flat standard marginal rate of 32 cents will apply, without surcharges, over the wide band of income from $3751 to$16 000. Nearly 90 per cent of taxpayers have taxable incomes falling within that band. The standard rate is well below the present marginal rate at the upper end of that band (45 cents) and almost 80 per cent of taxpayers having taxable incomes within that band will have their marginal rate of tax reduced. o The maximum marginal rate, on incomes above $32 000, is reduced from 65 to 60 cents, and the point at which the 60 cent rate commences to apply is increased from S25 064 to $32 001. The new system will be indexed as from 1 July 1978. The indexation factor to be applied to the rate scale in 1978-79 will be half that given by the annual indexation rules but the full adjustment will be applied to dependant rebates. The cost to revenue in 1978-79 of the new system on this basis is estimated to be $973 million. {:#subdebate-70-7} #### Arrangements for 1977-78 As noted earlier, the personal tax system to apply for 1977-78 will be a composite one based on the present system (with a weight of 7/12) and the new system (with a weight of 5/12). This means that, in practice, the effective rate scale to apply for 1977-78 after absorption of the general rebate will be - Particular features of 1977-78 arrangements are as follows: o The minimum taxable income subject to tax will be $3403 ($5336 for a taxpayer with a fully dependent spouse) . PAYE deductions as from 1 February 1978 will be on the basis of the new system outlined earlier. Provisional tax for 1977-78 levied on assessment on the basis of 1976-77 income will be calculated at 1976-77 tax rates. Where a taxpayer 'self-assesses' his or her 1977-78 provisional tax on the basis of estimated 1977-78 taxable income, 1977-78 rates of tax will be applied in the calculation of that provisional tax. The tax on non-residents, on trustees assessed under *section 98* or *section 99* and on primary producers to whom the averaging provisions apply, will be basically 7/12 of the tax under the present system plus 5/12 of the tax under the new system. The minimum taxable income subject to the health insurance levy will be $3114 ($4913 for a taxpayer with a fully dependent spouse), with the levy above $3113 being shaded-in at the rate of 29.5 per cent. {:#subdebate-70-8} #### Rebates for Concessional Expenditure Rebates will be allowed in 1977-78 for concessional expenditure in excess of $1590 at a rate of 32 per cent, i.e., a rate matching the new standard tax rate of 32 per cent. Under present law such expenditures in excess of $1690 attract a rebate (additional to the general rebate of $676) at the rate of 40 per cent. Lowering of the ceiling above which rebates are allowed for concessional expenditure from $1690 to $1590 brings those rebates (albeit at a reduced rate) within the reach of more taxpayers. The new ceiling of $1590 will not be subject to indexation adjustments. *Incentives for the Arts* At present, a person who donates a work of art or similar property to a public art gallery, museum or library may be eligible for an income tax deduction in respect of his gift only if he purchased the item within the 12-month period preceding the date of the gift. The amount allowable is restricted to the lesser of purchase price or market value at the time of making the gift. As from 1 January 1978, the 1 2-month test will be abandoned for a trial period of three years in respect of gifts of works of art and comparable material made to a public art gallery, museum or library. As well, the basis of determining the amount to be allowed as a deduction will be changed. From 1 January 1978, it will generally be market value or, where equity requires it in some particular circumstances, the cost to the donor. {:#subdebate-70-9} #### Other Measures {:#subdebate-70-10} #### Changes to Company Income Tax The rate of tax on taxable income of companies is being increased by 3.5 percentage points. The general rate applicable to income year 1976-77 will therefore be 46 per cent in lieu of the previously applicable 42.5 per cent. The rate of tax payable by a friendly society dispensary will move from 37.5 per cent to 41 per cent. Correspondingly, a superannuation fund that does not comply with the '30/20' ratio of investment in public securities, will have the rate of tax on its 1977-78 investment income increased from 42.5 to 46 per cent. {:#subdebate-70-11} #### Foreign Film Distributors From 17 August 1977, film and video tape royalties paid overseas will bear tax of 10 per cent of the gross payment. This basis will replace the present provisions introduced in 1942 to overcome problems of determining the true profit element of film royalties derived from Australian sources through foreign-controlled film businesses. Under those provisions most such royalties are taxed as if their profit content were 10 per cent, giving an Australian tax yield of no more than 4.6 per cent of the gross royalties (at the rate of tax now applicable to 1976-77 incomes of companies). {:#subdebate-70-12} #### Coal Export Duty The rates of duty on coking coal will be reduced from$4.50 to $3.50 per tonne for coal subject to the higher rate, and from$1. 50 to$1. 00 per tonne for that subject to the lower rate. *Excise Duty on Crude Oil* The rate of duty has been increased from $2.00 to $3.00 per barrel on crude oil; LPG from currently producing fields will continue to attract duty at the rate of $2.00 per barrel. The duty will not be applied to condensate marketed separately from a crude oil stream or to LPG from fields yet to come into production. *Duty on Petroleum Products* The duty on refined petroleum products will be increased by 0.25 cents per litre. The new rates are shown in the consolidated rate table included later in this Statement. {: .page-start } page 189 {:#debate-71} ### THE ESTIMATES The following table compares estimated receipts in 1977-78 with actual receipts in each of the two preceding years. {:#subdebate-71-0} #### Taxation Revenue After taking account of the measures described above, total taxation revenue in 1977-78 is estimated to increase by 13.7 per cent to $22 323 million. The main components are described below. {:#subdebate-71-1} #### Customs Duty - Imports The Customs authorities estimate that duty on imports will total $1315 million in 1977-78, an increase of $163 million or 14.1 per cent compared with 23.6 per cent in 1976-77. In 1976-77 the value of dutiable imports grew by 28.5 per cent, in part in consequence of the effect on import values of the devaluation of the Australian dollar in November 1976. Although dutiable imports are expected to grow very much less rapidly in 1977-78 than in 1976-77, the estimate assumes a partial offset through an anticipated increase in the ratio of duty to dutiable imports. *Customs Duty - Coal Exports* On the basis of existing rates of duty, revenue from the levy on coal exports is estimated at about $117 million in 1977-78. This further step in the phasing out of this duty is estimated to reduce collections in 1977-78 by $24 million to a total of $93 million. {:#subdebate-71-2} #### Excise Duty As outlined earlier, the duties on crude oil and petroleum products have been increased. After taking account of these changes, and of the effects of the crude oil pricing decisions (see below), collections of excise duty are estimated by the collecting authorities to be $2792 million in 1977-78, an increase of $307 million or 12 per cent on collections in 1976-77. Excluding the estimated effects on revenues of the changes in duties, collections are estimated to increase by 5 per cent. In 1976-77 collections increased by 6.6 per cent, reflecting in part the full year effect of rate increases introduced in 1975-76. The major components of the 1977-78 estimate, together with changes on 1976-77 figures, are as follows: In estimating the revenue from petroleum products, allowance has been made for the likely effects on usage of overall increases in prices of petroleum products arising from the various policy measures announced in the Budget. Clearances for consumption of the two main components - motor spirit and diesel fuel - are projected to increase at slower rates than in 1976-77 while aviation fuels, clearances of which declined in 1976-77, are expected to increase moderately. Rates of duty for the main items subject to excise are shown in the following table, which incorporates the changes announced in the Budget Speech. {:#subdebate-71-3} #### Sales Tax Sales tax revenue is estimated to increase by 13.0 per cent in 1977-78 to $1865 million; in 1976-77 sales tax receipts increased by 17.2 per cent. Sales tax revenue is dependent on the price and volume of taxable goods sold, and the 1977-78 revenue estimates are consistent with slower volume growth for the year as a whole and somewhat smaller price increases. Estimated collections by rate class are shown in the following table: {:#subdebate-71-4} #### Income Tax - Individuals It is estimated that *net* collections of income tax from individuals in 1977-78 will increase by 16.6 per cent to $12 884 million. {: type="a" start="a"} 0. *Pay-as-you-earn Instalment Deductions* For the purpose of calculating gross PA YE' instalment deductions average weekly earnings are assumed to increase by 10.5 per cent in 1977-78 and the average level of wage and salary earner employment for the year as a whole to increase by 0.75 per cent (both expressed in terms of male units). In 1976- 77 average earnings are estimated to have increased by 13.0 per cent and employment to have remained unchanged. An amount of $327 million has been included in the estimate for collections of the health insurance levy in 1977- 78 in respect of *all* individual taxpayers. New PA YE instalment schedules came into operation on 1 July 1977 incorporating the 10.9 per cent indexation adjustment to the personal income tax rate scale. The cost to revenue, in 1977-78, of this adjustment, for *all* individual taxpayers, is estimated to be $825 million. The overall cost of indexation to 1977-78 revenue is estimated at $965 million; an amount of $140 million in revenue forgone from the 1976-77 adjustment has not arisen until 1977-78. The 1977-78 estimate of $10 635 million in gross PAYE receipts represents an increase of 8.4 per cent over 1976-77 compared with an increase of 17.3 per cent in 1976-77. Adjusting for the loss to revenue of the new scales the 1977-78 increase would be 12.4 per cent. Collections in 1976-77 included for the first time the proceeds of the health insurance levy and were also boosted by the additional revenue arising from the abolition of child rebates. Adjusted for these factors, 1976-77 collections increased by 10.3 per cent. Refunds of tax in 1977-78 are estimated at $640 million, compared with $1282 million in 1976-77. The estimated further decline in refunds in 1977-78 is a result of the system of tax rebates (allowable in calculating instalment deductions) introduced in the 1975-76 Budget, which replaced most concessional deductions and which, together with the shape of the tax scales, reduces the extent of over-withholding through PAYE. (2>) *Other Individuals* Collections on assessments of individuals are estimated to increase by 14.4 per cent to $2889 million. These tax payments are based on incomes received in 1976-77. Primary producers' incomes are estimated to have increased only slightly in 1976-77 while other business and property incomes grew more strongly. The estimated revenue in 1977-78 has taken into account the effects on *other individuals'* income tax assessed of the investment allowance ($150 million) and the trading stock valuation adjustment ($35 million). {:#subdebate-71-5} #### Income Tax - Companies Company tax collections are expected to increase by $174 million or 6.1 per cent to $2998 million in 1977-78 compared with an increase of $302 million or 12.0 per cent in 1976-77. *Taxable* company incomes in 1976-77 (subject to tax in 1977-78) have been significantly lowered by the measures introduced during 1976. In respect of company tax, the investment allowance is estimated to reduce 1977-78 revenue by $325 million. The cost to company tax revenue of the trading stock valuation adjustment in 1977-78 is estimated at $281 million. On the other hand the increase in the rate of company tax announced in this Budget is estimated to increase 1977-78 revenues by $203 million; but for that change, company income tax revenues would have fallen by about $30 million this year. {:#subdebate-71-6} #### Other Taxes, Fees and Fines The major items in other taxes, fees and fines are indicated in the following table: Receipts from these sources are estimated to increase by a net $6.8 million in 1977-78 to S159.0 million. The largest increase is in respect of receipts from mainland territories. This category includes general rates ($14.0 million), drivers' licence and motor registration fees ($8.2 million) and liquor licence fees ($2.9 million). An amount of $6 million is included for proposed general revenue increases in the Northern Territory. The increase of $5.2 million in unfunded employees' retirement contributions results mainly from increased contributions to the Defence Forces Retirement and Death Benefits Fund. Radio-communications licence fees are to be increased for some classes of users from $20 a year to $25 a year from 1 October 1977. The new fees will increase revenue by $0.75 million in 1977-78 and $1 million in a full year. The fees payable by some licensees of commercial radio and television stations are also to be revised to yield an additional $3.3 million in revenue this financial year. The decrease of $18.4 million shown in receipts from the stevedoring industry charge reflects new arrangements to be introduced during 1977-78 for this industry. Under the new arrangements responsibility for making some of the payments made previously by the Stevedoring Industry Authority (and subsequently recouped by a levy on the industry) will be transferred to the industry itself. As a consequence, a lower scale of levies is to apply in 1977-78. Included in the 'other' category are passport fees ($7.0 million), animal and plant quarantine charges ($4.0 million) and payments by the Health Insurance Commission in lieu of taxes ($1.0 million). {:#subdebate-71-7} #### Interest, Rent and Dividends Details of estimated receipts of interest, rent and dividends in 1977-78 are set out below: All interest received by the Commonwealth Government from sources outside .the Budget sector is included under this general heading, together with land rents collected in the Territories and dividends received from Government-owned companies, other than financial enterprises. Total receipts from interest, rent and dividends are estimated at $1814 million, an increase of $186 million or 11.5 per cent compared with 1976-77. The projected increase in interest receipts reflects the large advances made in recent years to the Slates for both specific and general purposes, and to bodies, principally semi-government authorities, operating outside the Budget. The largest absolute increases in 1977-78 are in interest due on advances to the States (S159.6 million) and to the Telecommunications Commission (S26.5 million). A further reduction in interest received from the Australian Wool Corporation is expected in 1977-78 as the Corporation reduces its outstanding debt to the Commonwealth. *Net Receipts from Government Enterprise Transactions* Details are shown in the following table: This table covers receipts (other than taxation receipts) from public financial enterprises and the net operating revenues of certain activities carried on as business-type enterprises. The main component in the table is the payment to the Commonwealth from the profits of the Reserve Bank of Australia. The payment of S80 million to the Commonwealth in 1976-77 was the first such payment since 1972-73. During the intervening period net earnings of the Reserve Bank were used principally to reduce the Bank's unfunded exchange valuation losses. The Budget provides for a payment of $216 million in 1977-78 made up of $126 million as the Commonwealth's share of 1976-77 profits and S90 million as an interim payment from the Note Issue Department in respect of expected 1977-78 profits. (Further payments to the Commonwealth are expected from 1977-78 profits in 1978-79 when profits are finally determined for the year.) An amount of SI 5.5 million is expected to be paid to the Commonwealth by the Commonwealth Banking Corporation in 1977-78, equivalent to one-half of the published profits for 1976-77 of the Commonwealth Trading Bank and the Commonwealth Savings Bank. The $4.5 million turnaround in the 'other' category largely reflects growth in consumption and more effective billing and collection arrangements for electricity charges in the Northern Territory. {:#subdebate-71-8} #### Sale of Existing Assets The main feature here is the estimated receipt of $34.1 million in respect of the disposition of the Commonwealth's uranium stockpile. The Commonwealth has entered agreements to enable certain companies with previously approved contracts for sales of uranium to acquire uranium from the Commonwealth's stockpile. These agreements will allow the companies to make deliveries of this uranium in accordance with the approved contracts. The agreements provide for amounts approximating the net proceeds from the sale of the uranium to be paid to the Commonwealth pending the return of uranium to the Commonwealth. Receipts of this form in 1977-78 are estimated at about $34 million. Payments by the Australian Atomic Energy Commission for uranium purchases are also recorded in this item. The increase of $6.7 million in the 'other' category mainly reflects expected receipts from the sale of land and buildings that have been deemed surplus to the Commonwealth's requirements. {: .page-start } page 197 {:#debate-72} ### STATEMENT No. 5- BUDGET OUTCOME, 1976-77 The overall deficit of $2740 million for 1976-77 was$132 million higher than had been estimated at Budget time. Total outlays were$1 97 million below the original Budget estimate but there was a shortfall of $329 million in total receipts. The outcome is summarised in the following table: The main features of the aggregate figures are: for the second year in succession total outlays were held below the original Budget estimate; this reflected the Government's continuing policy of expenditure restraint and operation of monitoring and approval procedures directed towards achieving savings in expenditures wherever possible; the shortfall in receipts mainly reflected shortfalls in net PAYE and company taxation collections. in turn, the shortfall in net PAYE collections principally reflected a substantially greater level of refunds than had been estimated; and the actual deficit was closer to the Budget estimate than in any year since 1972-73. when the Budget aggregates were much smaller than they are now. {: .page-start } page 198 {:#debate-73} ### OUTLAYS Although outlays in total were held within the Budget estimate, there were substantial variations from the estimates for some individual components. The outcome for each major function is compared with the Budget estimate in the following table: Comments on the main variations from the Budget estimates follow. {:#subdebate-73-0} #### Defence Defence outlays in 1976-77 were $4 million more than the Budget estimate. Manpower costs were $20 million more, reflecting the impact of salary and wage determinations during the year. Expenditure on reserve capacity maintenance was higher due to increases in operating costs of defence munitions factories, including wage and salary costs. These increases, together with an increase in the working capital advance to the Government Aircraft Factory for the Nomad venture, were the main factors responsible for outlays associated with industrial capacity exceeding the Budget estimate by$5 million. Against these increases there were shortfalls in expenditure on equipment and stores ($13 million), due principally to rephasing of payment schedules on major items, and on defence facilities ($10 million). {:#subdebate-73-1} #### Education Outlays on education exceeded the Budget estimate by $31 million. Student assistance payments were about $27 million greater than estimated and reflected the substantial increases in benefit rates, and the liberalisation of means tests, announced by the Government after the Budget was brought down and effective from the beginning of 1977. {:#subdebate-73-2} #### Health Actual outlays on health in 1976-77 were $366 million below the Budget estimate. The bulk of the shortfall was attributable to Medibank expenditures. Medibank medical benefits were $170 million less than estimated and hospital benefits and payments were $104 million less. There was of course no previous experience on which to base Budget estimates for these items last year. The shortfalls which eventuated reflected three main factors: fewer persons than expected opting for the basic levels of coverage offered by Medibank Standard; a lower than estimated rate of usage of medical and hospital services generally; and some over-estimation of projected increases in public hospital operating costs. The Commonwealth's contribution to the Hospital Benefits Re-insurance Trust Fund was $22 million less than the Budget estimate and the subsidy payable to registered health insurance organisations was $10 million less. These shortfalls reflected in part difficulties which some private health insurance organisations encountered in assessing their entitlements to payment and in submitting their claims before the end of 1976-77. Health Program Grants to eligible organisations were $6 million less than estimated. Following the restructuring of the health insurance arrangements from 1 October 1976 a number of recipient organisations became ineligible for further grants. Pharmaceutical services and benefits were $40 million less than estimated largely because the volume of scripts processed was lower than had been assumed at Budget time. Outlays on nursing home and domiciliary care benefits and payments were $5 million less than estimated, mainly reflecting a lower than anticipated level of claims for nursing home benefits. Other significant variations from the Budget estimates included over-expenditures on hospital services for ex-service personnel ($9 million) and health services in the Territories ($6 million) and shortfalls in respect of Commonwealth Serum Laboratories ($3 million) and general administrative expenditures ($10 million). The higher than estimated outlays on the first two items largely reflected salary and other cost increases. In 1976-77 the Commonwealth Serum Laboratories deferred some capital expenditure and required less by way of reimbursement for research activities than had been expected. Lower than estimated costs for the Health Insurance Commission in relation to its Medibank (Public) function and savings achieved by the Department of Health were the main factors accounting for the shortfall in outlays on general administration in the health area. {:#subdebate-73-3} #### Social Security and Welfare Outlays on social security and welfare exceeded the Budget estimate by $169 million. The major factor in this increase was the increase of $165 million in expenditure on unemployment and sickness benefits - from $580 million to $745 million. The average number of benefit recipients in 1976-77 proved to be significantly higher than had been anticipated at Budget time. There were several other significant changes: payments of service pensions and family allowances were respectively $14 million, .and $7 million higher than estimated, while payments of supporting mothers' benefits were $7 million less than the Budget estimate. Delays in commencing projects resulted in under-expenditure of $6 million on estimated payments for children's services. {:#subdebate-73-4} #### Housing Outlays on housing were $19 million less than the Budget estimate with shortfalls of $22 million in respect of Defence Service Homes, mainly because of a lower than expected demand for loans and higher loan repayments, and $13 million in respect of Home Savings Grants, mainly reflecting lower than assumed application rates. Partly offsetting these shortfalls were increases in outlays on housing in the Territories ($7 million) and on housing for Aboriginals ($13 million). The latter increase mainly reflected the provision of additional funds after the Budget was brought down. *Urban and Regional Development nec and the Environment* Total outlays for the purposes encompassed under this heading were approximately $6 million less than the Budget estimate. An additional $11 million was provided for the growth centres of Albury-Wodonga, Bathurst-Orange and Macarthur after the Budget was brought down but this was more than offset by shortfalls in outlays on urban rehabilitation ($7 million), development of Aboriginal community amenities ($4 million), land development in the ACT ($3 million) and land commissions ($2 million) . {:#subdebate-73-5} #### Culture and Recreation Outlays on cultural and recreational activities were $3 million more than the Budget estimate. Net outlays on the National Broadcasting and Television Service were $8 million more than estimated because of wage and other cost increases. Capital assistance for leisure facilities fell short of the Budget estimate by $4 million; drawings, through the States, by project sponsors were not as high as expected. Expenditure on the construction of the National Gallery was $2 million less than estimated. {:#subdebate-73-6} #### Transport and Communication There was a shortfall of $54 million in outlays on transport and communication. The call on the Budget by Australian National Railways was $22 million less than had been estimated: this reflected lower than estimated losses on operations during the year and delays in the letting of long-term contracts for capital items. Advances to the Australian Shipping Commission were $15 million less than estimated, reflecting both an improved cash flow and the deferral of some capital items. During the year the Overseas Telecommunications Commission made a repayment of capital ($10 million) which was not provided for in the Budget. Delays in the completion of the MoombaSydney pipeline project reduced the Pipeline Authority's requirement from the Budget by $4 million. {:#subdebate-73-7} #### Industry Assistance and Development Outlays under this heading exceeded the Budget estimate by $76 million. Provision had been made in the estimates for the Australian Wool Corporation to repay $245 million previously borrowed from the Government but in the event repayments were $100 million less than estimated. Outlays on the mining industry were a net $11 million more than estimated. Proceeds from divestment of assets acquired by the former Petroleum and Minerals Authority were $7 million less than estimated, because divestment was on balance less rapid than expected; for the same reason investment in petroleum and minerals development (by way of expenditure in relation to those assets) amounted to $4 million more than had been estimated. Grants to the States for beef industry loans were $12 million less than estimated reflecting, in part, the transfer of carry-on finance to the new Rural Adjustment Scheme which came into operation on 1 January 1977. Spending on the eradication of cattle diseases was $4 million less than estimated. Other shortfalls occurred in respect of outlays for export development assistance ($10 million) and marginal dairy farm reconstruction ($7 million). {:#subdebate-73-8} #### Labour and Employment Total outlays for activities under this heading exceeded the Budget estimate by $19 million. The Government's decision after the Budget to continue existing arrangements for the stevedoring industry to 31 December 1977 resulted in payments to the stevedoring industry being $27 million greater than the Budget estimate; the Budget estimates were based on these arrangements terminating on 31 December 1976. Payments under the NEAT scheme were $8 million less than estimated. This largely reflected a change in the emphasis of the scheme towards more 'on-the-job' training and a delay in the numbers of trainees building up to the expected levels. Outlays on apprenticeship schemes were $2 million more than the estimate. The number of assisted passage migrants in 1976-77 was considerably less than the number underlying the Budget estimate with the result that expenditure under this scheme fell short of the Budget estimate by $6 million. {:#subdebate-73-9} #### General Public Services Total outlays for general public services were $19 million less than the Budget estimate. Outlays on *law order and public safety* were $8 million less and mainly reflected lower than estimated outlays on the Australian Family Court ($5 million). *Overseas aid* payments were $19 million less than estimated - considerable underspending occurred on bilateral aid projects. Expenditure on *legislative services* was $10 million more than the Budget estimate; that estimate did not include provision for the Constitutional referendums held in May 1977.. Outlays on *administrative services* were $7 million less than the estimate. Net superannuation payments were $11 million higher than estimated but expenditures on many administrative and operational items were held below the original estimates. *Payments to or for the States and Local Government Authorities nec and Natural Disaster Relief* Outlays in this category fell short of the Budget estimate by $4 million. Payments to the States in respect of their personal income tax sharing entitlements were $21 million below the estimate, primarily because of downward revisions during the year of the estimate of personal income tax collections. Repayments of special advances made to New South Wales in 1971-72 and 1972-73 fell short of the Budget estimate by $10.5 million; these two loans were consolidated, and principal repayments rescheduled, after the Budget was brought down. Natural disaster payments exceeded the Budget provisions by $6 million mainly as a consequence of payments following severe bushfires in Victoria and floods and cyclones in Queensland during 1976-77. {:#subdebate-73-10} #### Public Debt Interest The higher than assumed level of subscriptions to Treasury Notes during 1976-77 was mainly responsible for the increase of $38 million in public debt interest over the Budget estimate. {: .page-start } page 202 {:#debate-74} ### RECEIPTS The differences between the Budget estimates and actual receipts in 1976-77 are set out in the table below; the accompanying notes comment briefly on the main variations. {:#subdebate-74-0} #### Customs Duty - Imports Collections of customs duty on imports were S42 million higher than estimated, mainly as a result of the effects of the devaluation of the Australian dollar on the value of dutiable imports. {:#subdebate-74-1} #### Customs Duty - Coal Exports Revenue from coal export levies exceeded the Budget estimate by $9 million reflecting a higher volume of exports than estimated at Budget time. *Excise Duty* $340 million was collected from the levy on crude oil, $35 million more than the Budget estimate of $305 million. Even so, excise collections in total were $24 million less than the Budget estimate. This was because clearances of most other dutiable goods, in particular beer, were lower than had been estimated at Budget time. {:#subdebate-74-2} #### Sales Tax Revenue from sales tax was S50 million lower than estimated; this was due to a slower than anticipated increase in taxable sales, reflecting lower than expected increases in both price and volume of goods sold. *Income Tax on Individuals - Pay-as-you-earn* Net PAYE income tax collections of S8529 million were S246 million lower than the Budget estimate of $8775 million, and represented the largest absolute difference between Budget estimates and actual outcomes on the receipts side. Gross collections of PAYE instalment deductions were $64 million less than the Budget estimate. Average earnings grew a little more rapidly than assumed in the Budget estimate, while employment increased by less. Refunds of PAYE tax collections, which were $182 million more than estimated, relate to deductions from earnings in 1975-76, the first year in which the new income tax rebate arrangements operated. The estimate had not allowed sufficiently for the over-deduction of tax instalments for some taxpayers in the first half of 1975-76 (when the old tax instalment schedules applied), the effect of taxpayers not claiming dependants for PAYE purposes and the effect on refunds of unemployment and part-time employment. Collections of the Health Insurance Levy in respect of all individual taxpayers amounted to $177 million in 1976-77. *Income Tax on Other Individuals* Collections on assessment of income tax on individuals, at $2525 million, were very close to the Budget estimate of $2532 million. {:#subdebate-74-3} #### Income Tax - Companies Company income tax collections were $76 million less than the Budget estimate, reflecting a smaller than estimated increase in company incomes in 1975-76 on which tax was paid in 1976-77. {:#subdebate-74-4} #### Other Taxes, Fees and Fines Other taxes, fees and fines exceeded the Budget estimate by $33 million, mainly reflecting the Government's post-Budget decision to extend the Stevedoring Industry Charge Act beyond 31 December, which added $27 million to estimated receipts. {:#subdebate-74-5} #### Sale of Existing Assets Receipts under this heading were $6 million less than estimated, principally because of the shortfall in estimated receipts from the sale of A.C.T. leases. {: .page-start } page 204 {:#debate-75} ### FINANCING TRANSACTIONS The manner in which the deficit in 1976-77 was financed is summarised in the following tables. The first of these tables is the usual presentation of Budget financing transactions, recast to indicate *Domestic Borrowings* (DB) and its composition. While this presentation is useful for purposes of describing aggregate financing transactions - and in particular the *securities* (financing instruments) involved in those transactions - it does not bring out the net changes in the holdings of government debt of the several sectors with which the Budget sector transacts. This further information is relevant to analysis of the monetary implications of deficit financing. Portfolio movements, reflecting both net proceeds (subscriptions to new issues less redemptions) and subsequent market transactions in government securities, are shown in the second table; the link between the tables is *Domestic Borrowings.* As defined here, DB is that portion of the Budget deficit financed by the issue of Commonwealth securities to domestic non-Budget sectors or by the use (running-down) of Commonwealth cash balances with the Reserve Bank.'1' Subject to minor qualifications, DB thus represents the increase in the indebtedness of the Commonwealth to domestic non-Budget sectors arising from its budget financing. (2 Economic effects of financing transactions depend importantly on which of the nonBudget sectors hold the stock of government debt. Private sector holdings of Commonwealth debt constitute the bulk of the liquidity base of the economy. (See also footnote (b) to Table 2.). Private sector take-up reflects a large number of factors which impinge on domestic liquidity conditions including the size of DB, official interest rates, the balance of payments outcome and net Reserve Bank lending to the private sector.*3) Other things being equal, take-up of government securities by the non-bank private sector provides an offset to the direct increase in banking sector liquidity and the volume of money that would otherwise have acccompanied an increase in the domestic liquidity base. The second table therefore distinguishesbetween banks and non-banks and, within each category, the major institutional groups for which it is useful, and possible with available data, to sub-categorise. *Changes* in debt by main *forms* of security are also shown. This too is relevant information for the analysis of the economic impact of Budget financing transactions, but a full exposition must go beyond the fairly direct effects reflected in Table 2. Other relevant factors include effects on the maturity structure of the *stock* of government debt in private portfolios, the level and structure of interest rates and associated expectations.'4' Quarterly data in the format of Table 2 are presented in Table11 of Statement No. 2. Brief comments on the main items in Table 1 are provided below. {:#subdebate-75-0} #### Net Overseas Borrowings In September a loan totalling $242 million was raised on the Euro-dollar bond market in Frankfurt. The proceeds of the loan were applied to the States Grants Housing Assistance program and the States Grants Capital Assistance program, two thirds of the proceeds going to the former and one third going to the latter. Another publicloan of $196 million was raised in New York in November and the proceeds applied to advances to the States for capital works. Loan raisings on behalf of the Australian Shipping Commission amounted to $19 million and $2 million was drawn down on existing credits for Qantas. Repayments of previous drawings for Qantas amounted to $21 million and repayments on behalf of TAA totalled $6 million. Other securities to the value of $43 million were redeemed in the U.S.A., U.K., Germany and Canada. Repayments of $4 million were made on borrowings from the International Bank for Reconstruction and Development. Repayments of previous drawings arranged for defence equipment amounted to $28 million in 1976-77. *Net Proceeds of Loan Raisings in Australia* Australian Savings Bonds raised $736 million in 1976-77; redemptions amounted to $216 million resulting in net proceeds of $520 million. Redemptions of the superseded Special Bonds amounted to $153 million. Four Government public cash and conversion loans in July, October, February and May resulted in loan raisings of $1536 million. Total redemptions and repurchases amounted to $115 million. In the 1975-76 Budget, the Government introduced a scheme of Income Equalization Deposits for primary producers and announced that Drought Bonds were to be discontinued with holders being offered the option of transferring to the new scheme. An amount of $36 million, net of Drought Bonds, was received. States' Domestic loan raisings were $35 million, bringing net proceeds of loan raisings in 1976-77 (excluding Savings and Special Bonds but including Income Equalization Deposits) to $1494 million. *Net Change in Treasury Notes on Issue* Treasury Notes are the shortest term Government security issued to the public in Australia. As at 30 June 1977, Treasury Notes on issue amounted to $370 million, a decline of $87 million during 1976-77. {:#subdebate-75-1} #### Other Financing Transactions The major components of this category were net payments of $130 million by the Postal and Telecommunications Commissions, representing the employer contributions to the Commonwealth superannuation scheme; $21 million in proceeds from coinage transactions; $25 million received from the Commonwealth Government Superannuation Fund in respect of the liability assumed by the Government for existing pensioners at 1 July 1976; offset by an amount of $38 million representing a reduction in the value of unpresented benefit cheques drawn against the Health Insurance Fund during the year. {:#subdebate-75-2} #### Residual Financing The Government ran down its cash balances by $27 million during 1976-77. Borrowings from the Reserve Bank during the year amounted to $450 million which was covered by the issue of Treasury Bills. Table 2 indicates that private sector holdings of Government securities increased by $837 million in 1976-77; Treasury Note holdings fell $207 million and other securities (mainly Treasury Bonds and Australian Savings Bonds/Special Bonds) rose by $1044 million. An account of the factors affecting this aggregate movement and the strong seasonal swings in holdings which occurred during the year is found in the *Monetary Conditions* section of Statement No. 2; Table 1 1 of that Statement provides relevant data. {:#subdebate-75-3} #### Banking Sector Aggregate banking sector holdings of government securities declined by $252 million in 1976-77 .comprising falls of $199 million in Treasury Notes and $53 million in other securities (mainly Treasury Bonds). Decreases in the aggregate portfolios of savings and trading banks were about equal but the main change in the books of trading banks occurred in their Treasury Note holdings, which were reduced by $207 million, while savings banks maintained their stock of Notes and ran down other securities by $144 million. {:#subdebate-75-4} #### Non-Bank Private Sector Private non-bank groups accounted for 48 per cent of Domestic Borrowings. Treasury Note holdings did not change appreciably for the year as a whole although, as can be seen from Table 11 of Statement No. 2, there were marked within-year movements; holdings of other securities (mainly Treasury Bonds and Australian Savings Bonds) were increased by $1,097 million. The bulk of this rise occurred in the portfolios of *Other Groups* which increased by $779 million, of which about half was on account of net subscriptions to Australian Savings Bonds (and Special Bonds). As Table 11 of Statement No. 2 shows, increases were recorded in the total holdings of this group in each quarter. Despite the strong seasonal liquidity downswing during which *Other Groups* ran down their Note holdings, they accumulated bonds very strongly in the second half of the financial year. Authorized dealers increased their holdings of government debt by $114 million over the year compared with $67 million during 1975-76. Holdings of Treasury Notes declined by $41 million for the year as a whole; dealers built up their portfolios of Notes in the seasonal upswing, especially in the December quarter, and subsequently ran them down. They increased bond holdings heavily in the final quarter ending the year with an accumulation of $155 million. The movement in holdings of Treasury Notes of Life Offices was negligible over the year as a whole. Their portfolio of other securities (mainly Treasury Bonds) rose by $196 million in 1976-77, with a heavy accumulation in the latter part of the year. {:#subdebate-75-5} #### Reserve Bank Reflecting both the size of the Budget deficit and movements in the portfolios of other sectors, net Reserve Bank holdings of government securities increased by - $1527 million. This represented 68 per cent of Domestic Borrowings. {: .page-start } page 208 {:#debate-76} ### STATEMENT No. 6- BUDGET TRANSACTIONS SINCE 1967-68 This Statement presents details of Budget transactions since 1967-68 in both the national accounting and functional classifications. Traditional presentations of public sector data grew out of the requirement for maintaining Parliamentary control over the authorization of government spending. Information presented in a form suitable for this purpose (e.g. the Appropriation Acts) does not, however, readily lend itself to an assessment of either the economic impact, or the primary objectives and relative priorities of government financial activity. The *national accounts classification* summarises Budget transactions (outlays, receipts and financing) within a classification framework which is broadly consistent with conventions recommended in the United Nations *System of National Accounts.* The classification of Budget transactions by economic type clarifies the nature of the transactions between the public sector and the rest of the economy. It provides a consistent framework for the aggregation of Commonwealth, State and local government transactions into consolidated figures for the public sector as a whole and facilitates comparisons with other national accounts data. The *functional classification* categorises Budget outlays according to their primary objectives or purposes. This facilitates decision-making on the nature, extent and relative priorities of Government activities. The functional classification follows the same conventions for the determination of Budget totals as the national accounts classification. Additional information on the two classification systems is given in the Appendix to the Budget Statements. A later section of this Statement refers briefly to the transactions of the Commonwealth Government sector as a whole, and to the total public sector (including State and local government). {:#subdebate-76-0} #### Budget Outlays - Summary The following table shows increases in Commonwealth Government Budget outlays in each year since 1967-68, and those outlays expressed as a proportion of gross domestic product (GDP). It can be seen that total outlays increased much more rapidly than GDP in 1974-75 and 1975-76 but less rapidly in 1976-77. The estimated increase of 10.5 per cent in Budget outlays in 1977-78 is expected to imply some further reduction in the ratio of outlays to GDP in the current year. Budget Outlays by Function Functionally classified Budget data for the period 1967-68 to 1976-77 are presented in Tables 1 and 3 at the end of this Statement; Table 2 shows the proportions of total outlays represented by the major functional and sub-functional blocks over this period. Total Budget outlays have grown at an average annual rate of 17.3 per cent over the nine year period to 1976-77. Outlays on some functions, however, have grown much faster, and others much slower, as the table below shows: Comparisons of trends over the period covered in the tables are affected by a number of important factors, including the transfer of pay-roll tax to the States, 'offsets' to grants to the States, changes in the operation of certain retirement benefits schemes, changes in the arrangements for funding tertiary education, the introduction of Medibank and family allowances, the transfer of the South Australian and Tasmanian railways to the Commonwealth, and part-funding of the capital program of Australian Telecommunications Commission by borrowings on the domestic capital market. These and other factors must be borne in mind when comparing movements in different categories of expenditure. Average annual rates of increase, which indicate the *trend* in expenditures over a period, can of course mask significant changes within that period. The charts below show expenditure on major functional blocks as a proportion of total Budget outlays, in each of the past ten years. Budget Outlays by Economic Type The national accounts for the economy as a whole provide a systematic summary of the transactions that take place within the economy, especially those relating to the production and use of goods and services, and to transfers of income or capital between sectors of the economy. By outlining these relationships the national accounts enable analysis of the processes by which production and expenditure are linked. Table 4 attached to this Statement shows Budget outlays since 1967-68 classified according to broad national accounts categories. On this basis transfers between different parts of the accounts of the Commonwealth Budget sector are eliminated and additional detail included so that the figures shown relate to the transactions which occur between the Commonwealth Budget sector and the rest of the economy, including other levels of government, and overseas. The national accounting presentation, by showing Budget sector transactions 'classified in a form which is broadly comparable with that presented for the economy as a whole in the Budget Paper *National Income and Expenditure* 1976-77, facilitates analysis of the impact of the Budget on the economy. The following table compares the average annual rates of growth of the main components of outlays with that for gross domestic product (GDP) in the period since 1967-68. Within that period there have been significant movements in the proportion each component bears to total outlays; these movements, reflected in the following charts, must also be viewed against the background of the important changes in Commonwealth financing arrangements referred to earlier. {:#subdebate-76-1} #### Budget Receipts Details of Commonwealth Budget Sector receipts for the period since 1967-68 are presented in Table 5 at the end of this Statement. Total Budget receipts have increased at an average annual rate of 16.1 per cent in the period since 1967-68 compared with a 14.7 per cent rate of growth in GDP over the same period. As the following table shows, after increasing very rapidly in 1973-74 and 1974-75 the rate of increase slowed somewhat in 1975-76 and 1976-77; Details of the composition and rate of growth of Budget receipts over the period are shown in the following table: The charts below indicate the relative importance of the various categories of receipts in total Budget receipts: By far the most important single category of receipts is income tax on individuals which increased from 39.0 per cent of total receipts in 1967-68 to 51.7 per cent in 1976-77. This increase stems largely from the effects of the progressive rate scale in a period of strong growth in personal incomes, particularly wage and salary incomes. This growth occurred despite adjustments to the rate scale and other elements of the personal income tax system that were made in 1970-71, 1972-73, 1974-75, 1975-76 and 1976-77 with a view to reducing rates of tax for most taxpayers. As well as reflecting the introduction of personal income tax indexation the 1976-77 figures were also affected by the abolition of tax rebates for dependent children and students, which accompanied the introduction of family allowances, and the imposition of the Health Insurance levy. Movements in some other categories of receipts are also affected by certain special factors: 'Other General Taxation', for example, is affected by the transfer to the States in September 1971 of pay-roll tax and the decision to abolish broadcast listeners and television viewers licences from September 1974. {:#subdebate-76-2} #### Overall Budget Results The Commonwealth Government has incurred overall deficits on its budgetary transactions in each year since 1967-68 (see Table 1). Estimates of the domestic budget result are available only for the years since 1968-69. These estimates are shown in the following table, along with the overall Budget results for the same years; the latter are also expressed as a proportion of GDP: The main transactions undertaken to finance the deficits in the Budget over the period have been domestic and overseas loan raisings, the issue of Treasury Notes and temporary borrowings from the Reserve Bank. Details of these financing transactions are shown in Table 6 to this Statement. There is, of course, no single measure of the economic impact of Budget transactions. Although the Budget deficit (or surplus) is often taken asa shorthand or summary measure of Budget impact, its use for this purpose is subject to a number of important qualifications. The deficit measures the difference between outlays and receipts and cannot adequately reflect the differing economic impacts of the components of outlays and receipts. Budget outlays on final goods and services have a more direct impact on demand in the economy than do transfers and advances from the Budget to other sectors; the impact of these latter transactions depend on the spending propensities of the recipients and related timing lags. Similarly, on the receipts side, account must be taken of the varying impact on activity of different taxes and other receipts. Taxes on incomes, for example, influence private demand for goods and services through their effects on the level of disposable incomes; sales taxes on the other hand principally affect private demand through the prices of goods.. Consequently, the 'mix' of Budget revenues, as well as their total size, is a relevant Consideration in any assessment of the Budget's overall impact on the economy. It is also important to distinguish between domestic and overseas transactions; government payments made overseas do not add directly to domestic incomes and the demand for locally produced goods and services, while government receipts from overseas sources increase total receipts without withdrawing purchasing power from the domestic private sector. The transactions by which the overall Budget deficit (or surplus) is financed are also of considerable significance for monetary conditions and economic developments generally. An outline of the significance for monetary policy of Budget financing transactions is contained in the relevant section of Statement No. 5. {:#subdebate-76-3} #### The Budget Sector and Other Levels of Government Transactions of the Commonwealth Budget greatly influence, both directly and indirectly through transfers to other levels of government and authorities, transactions between all levels of government and other sectors of the Australian economy. Mention is made in the following paragraphs of the relationship between the Budget sector and the total Commonwealth Government sector and between the latter sector and the total public sector. {:#subdebate-76-4} #### Commonwealth Government Sector Table 7 attached to this Statement sets out national accounts estimates of the main categories of receipts and outlays of the Commonwealth Government sector as a whole, for the period since 1967-68. This table is prepared by offsetting transfers between the Budget and non-Budget sectors of the Commonwealth Government and consolidating all other transactions, to form a statement of the transactions of the Commonwealth Government sector as a whole, with the other sectors of the economy (including other levels of government). Its preparation is described in the Appendix to the *Supplement to the Treasury Information Bulletin, National Accounting Estimates of Receipts and Outlays of Australian Government Authorities, September 1974.* The non-Budget sector may be broadly described as comprising the trading enterprises of the Commonwealth Government other than financial enterprises such as the Commonwealth Banking Corporation. Total Commonwealth Government sector outlays have grown at an average annual rate of 17.3 per cent in the period since 1967-68. The Budget component clearly dominates the transactions of the Commonwealth Government sector as a whole. There are, however, some differences between the relative composition of transactions of the Budget sector and the Commonwealth Government sector. The main difference is that capital expenditure by the Commonwealth Government sector as a whole is significantly greater than for the Budget sector, because authorities outside the Budget finance their capital expenditure from funds provided from the Budget in the form of advances, from their own internally generated funds and particularly in recent years, from non-Budget sources. The following table shows the composition of transactions of the two sectors in 1976-77: {:#subdebate-76-5} #### Total Public Sector A statement of the transactions of the total public sector with the other sectors of the economy, is formed by consolidating the transactions of the Commonwealth, State and local governments. Detailed information concerning transactions of the total public sector are given in Budget Paper No. 9, *National Income and Expenditure 1976-77,* prepared by the Australian Statistician. Although there are some differences in treatment between the Statistician's publication and the presentations adopted in this Statement for the total Commonwealth sector, the information published by the Statistician permits a comparison to be made of relative proportions of total government transactions undertaken by the Commonwealth and the State and local sectors. The charts below show, for recent years, public sector outlays and receipts as a proportion of GDP. The Commonwealth component (excluding Commonwealth grants and net advances to the States) and the State/ local government components are also shown. Notes on Tables To the extent practical, historical data have been adjusted to eliminate major breaks in series but some important changes affecting comparability cannot readily be removed. At the Premiers' Conference in June 1971 it was agreed that the Commonwealth Government would cease to levy pay-roll tax in the States as from 1 September 1971 and that the States would levy their own pay-roll taxes as from the same date. This decision resulted in a reduction in Commonwealth pay-roll tax revenues estimated at $253 million in 1971-72. To offset most of this loss in revenue, financial assistance grants paid to the States in 1971-72 were reduced. The full-year effect of these transfer arrangements is reflected in the 1972-73 figures for outlays and receipts. The transfer arrangements had the effect' of reducing the growth of outlays and receipts below the rate that would otherwise have been recorded by approximately 3 percentage points in 1971-72 and about 1 percentage point in 1972-73. The figures shown in the tables reflect these lower growth rates. Comparisons between 1972-73 and subsequent years are not affected by the transfer since no significant effects of the changeover continued beyond 1972-73. Increases in special purpose payments to the States are recorded under the appropriate functional headings, while 'offsetting adjustments' to General Revenue Assistance Grants to the States are taken into account under the functional heading Payments to or for the States and Local Government Authorities nec and Natural Disaster Relief. The assumption in 1973-74 of full financial responsibility for universities and colleges of advanced education by the Commonwealth Government contributed to an increase in outlays classified to Education but also involved a compensating decrease in general purpose funds provided to the States. This means that the rate of increase in Commonwealth Government resources devoted to education, as shown in the function Education, is somewhat overstated. A similar effect occurred in 1974-75, which was the first full year of the new tertiary education arrangements. Changes in the operation of the Defence Force Retirement and Death Benefits, Ministerial Retiring Allowances and Parliamentary Retiring Allowances Schemes affect the outlays for 1973-74 and subsequent years under the relevant functions and receipts under the heading Other Taxes, Fees and Fines - Unfunded Retirement Benefits Contributions. These changes involved a move from funded schemes to unfunded benefit schemes. The implementation of the new Commonwealth Superannuation scheme with effect from 1 July 1976 gives rise to similar effects. The Family Allowances scheme introduced in 1976-77 involved the abolition of taxation rebates for dependent children and students, offset by substantial increases in family allowances in place of child endowment. The effect of this measure was to sharply increase the level of outlays under the Social Security and Welfare function in 1976-77, and to increase receipts from personal income taxation, above what they would otherwise have been. Notes on Tables 1, 2 and 3: Budget Outlays Classified by Function To the extent possible, the definitions and concepts adopted for the historical series are the same as those used in Statement No. 3 (although Table 3 provides less detail than do the tables in Statement No. 3). **Major discontinuities** are indicated where appropriate. The 1956-66 Housing Agreement was not renewed on its expiry at the end of 1970-71. Instead, the Commonwealth and State Governments agreed on arrangements under which housing allocations would be met by the States out of their approved Loan Council borrowing programs. Amounts totalling$1 60 million in 1971-72 and $166.9 million in 1972-73 were subsequently allocated by the States for housing projects similar in nature to those covered by the 1973 Housing Agreement. Tables 1, 2 and 3 show these amounts classified to 'Payments to the States, etc' instead of Housing'. However, for the purposes of the calculation of the trend rates of growth and the chart of proportions of total outlays, these amounts have been included in the function 'Housing'. Because of revisions in the classification of items to the various functional headings (see Appendix to the Budget Statements) the figures in Tables 1 and 3 are not entirely comparable with those given in the Budget documents in previous years. {: .page-start } page 235 {:#debate-77} ### APPENDIX TO THE BUDGET STATEMENTS - THE FUNCTIONAL CLASSIFICATION OF BUDGET OUTLAYS The purpose of the functional classification is to bring together outlays with like objectives or purposes. In this way the classification aims to present information on the nature of government activities, on the resources devoted to particular objectives and to facilitate assessments of the effectiveness of outlays in meeting objectives. Compared with the classification used in Budget Statements prior to 1973-74, the functional classification has the added advantage of being based on national accounting conventions. There is thus a consistent conceptual basis underlying both the economic classification and the functional classification. This removes a considerable source of confusion which existed in Budget documents prior to 1973-74 when two conceptually different classifications were used - the so-called 'conventional' classification and the national accounting classification. Basis of the Functional Classification The conventions and principles used in the functional classification are essentially those set out in the publication *A System of National Accounts,* United Nations, New York 1968. That classification is a widely accepted international standard for the classification of public expenditure by function. The Australian Bureau of Statistics has concurrently adopted these conventions and principles in the documents it publishes on public authority finance. While the major functional headings adopted for Budget purposes are conceptually consistent with those used by the Statistician in his publications, it should be noted that the figures published by the Bureau for Commonwealth Government outlays cover both Budget outlays and outlays by Commonwealth Government authorities which operate outside the Budget sector. They therefore differ somewhat from the figures shown for the Budget sector in the Budget Statements. Information on the transactions of authorities operating outside the Budget sector is shown in the *National Accounting Estimates of Receipts and Outlays of Commonwealth Government Authorities* which is published with the Budget documents. Two further differences should be noted. First, outlays on primary industry assistance are shown in the Budget Statements 'net' of the relevant primary industry levies and charges; these outlays are shown on a gross basis by the Statistician. Secondly, for the years prior to 1974-75, part of the expenditure incurred by some Commonwealth Government departments and instrumentalities operating in Papua New Guinea is classified by the Statistician as foreign aid. In the Budget Statements these outlays are shown under the same functional heading as similar outlays made within Australia. Supplementary information on the functional allocation of these outlays is available in the Bureau's publication *Public Authority Finance - Federal Authorities.* The Structure of the Functional Classification The major functional headings are shown in the summary table in Statement No. 3. Brief descriptions of the contents of each function are given below. These descriptions are intended to convey the scope of the outlays included under each heading rather than to be a detailed listing of the contents of each category. Further detail on each function is provided in the body of Statement No. 3. Historical data for the period 1967-68 to 1976-77 are given in Statement No. 6. From an examination of the classification structure set out in the Budget Statements it will be evident that the functional classification is relatively aggregative in nature. On the whole it has not been possible, for example, to dissect the administrative outlays of departments and to allocate them over the particular sub-categories shown under each functional heading. Outlays under each functional heading in the classification have been grouped together into readily identifiable blocks. These blocks do not, as a rule, purport to represent detailed purpose-oriented sub-functions or programs; rather, they are meant as recognisable and meaningful groupings which lend themselves to discussion and analysis. Nevertheless, the main outlay blocks are decidedly more purpose-oriented than was the case with the categories of expenditure identified under the conventional classification used prior to 1973-74. Given the need to produce a continuing and up-to-date record of actual monthly outlays and receipts which is consistent with the overall estimates embodied in the Budget Speech and documents, it has been necessary to work largely within existing central accounting records. These records are built around the Appropriation Acts, which are the legal authority for expenditure rather than detailed costing documents. The figures presented, therefore, have been derived essentially by reclassifying appropriation data, supplemented where necessary by a limited amount of sub-costing of substantial appropriation items which cover several functions. Functional categories do not necessarily correspond with appropriation or departmental structures. Furthermore, some outlay and receipt figures are netted in arriving at aggregates. Expenditure votes and revenue heads under the control of a particular department may, therefore, be classified under more than one functional heading and it will not always be possible to identify individual appropriation items in the Statements. The introduction of the functional classification, however, does not alter the structure of the appropriations or the summaries presented with the Appropriation Bills, such as the document *Estimates of Receipts and Summary of Estimated Expenditure.* Although the basic aim of a functional classification scheme is to reveal the broad purposes for which government outlays are undertaken, it is important to note that such a classification cannot always be applied unambiguously. Particular outlays will often serve two or more distinct functions. Military colleges, for example, may be said to serve both a defence and an education purpose. The application of a functional classification scheme, however, requires that an outlay be classified to the function which it is considered primarily to serve. In the example above, the primary function is considered to be defence; this is in line with United Nations recommendations. It is not possible, in any single classification system, to focus at one and the same time on every outlay characteristic that may be of interest to the Government or the public. Supplementary information on particular aspects of expenditure is therefore provided in other documents; for example, details of wage and salary estimates are shown in the document *Estimates of Receipts and Summary of Estimated Expenditure* and a separate Budget Paper is provided on *Payments to or for the States and Local Government Authorities.* Other supplementary Budget Papers issued with the Budget Speech this year deal with the Civil Works Program and Australia's Official Development Assistance to Developing Countries. {:#subdebate-77-0} #### The Implications of Adopting National Accounting Conventions The use of definitions of Budget outlays and receipts based on national accounting conventions places Budget data on a basis which, in the main, is conceptually consistent with national accounting information published by the Australian Bureau of Statistics and can be related to that information. The principles underlying the national accounting presentation of Budget data are set out in the Appendix to the Supplement to the Treasury Information Bulletin entitled *National Accounting Estimates of Receipts and Expenditure of Australian Government Authorities,* September 1974. Concurrent with the introduction of the functional classification in 1973-74, some changes were made to the previous national accounting definitions of outlays, receipts and the deficit, used in the Budget Statements. The more significant of these changes were: {: type="a" start="a"} 0. net advances to the Australian Wheat Board are now treated as outlay items, rather than financing transactions. This brings the classification of these shortterm advances into line with that accorded to other advances from the budget; 1. purchases of land and existing buildings (including inter-departmental transfers for which a financial adjustment is made) are now treated as outlays rather than offsets to the proceeds from the sale of these assets under a receipts heading. This change permits gross outlays on these assets to be shown under the appropriate functional headings. Other conceptual changes in line with the principles set out in the publication *A System of National Accounts* were also introduced. These changes relate mainly to the treatment of rents and business enterprise transactions and are indicated in the September 1974 Supplement to the Treasury Information Bulletin. Overall, they do not have a very significant effect on the figures shown for total receipts and total outlays. The adoption of national accounting conventions implies that the receipts and outlay figures shown in the Statements attached to the Budget Speech relate to the net transactions of the budget sector with the rest of the economy. Some important characteristics of the national accounting treatment shown in the Statements are: {: type="a" start="a"} 0. the transactions of various Funds forming the Public Account (the Consolidated Revenue Fund, Trust Fund and Loan Fund) are consolidated and inter-fund transfers are eliminated. For example, payments to Trust Accounts are not shown as part of outlays; rather, the expenditure from Trust Accounts is included. The aim is essentially to record the transactions between the Budget sector and the rest of the economy. Allowance is made, however, for adjustments between functions arising from the transfer of existing assets where financial adjustments for these transfers are recorded; 1. receipts derived from activities which are essentially of a governmental nature, involving regulation and compulsory payment, are normally treated as revenue items. As mentioned earlier, however, the various primary industry levies and charges which are collected by the Government and applied more or less directly for the purposes of commodity stabilisation, research and promotional activities are offset against the relevant outlays. Other recoveries and repayments are normally offset against the relevant outlays to arrive at net outlay figures. For example, repayments of principal on advances to other authorities are offset against the corresponding advances under the same outlay heading. Bringing together the relevant outlays and recoveries or repayments makes it possible to see more readily the extent of financial resources which are directed through the Budget to a particular activity. Other taxes, compulsory charges, licence fees and the like which are of a general revenue nature are treated as receipts items under the heading 'Other Taxes, Fees and Fines'; 2. the operating revenues, net of operating expenses, of activities which are carried out as business-type enterprises are shown as receipts items. The current operations of enterprises are therefore reflected in the Budget Statements to the extent that they contribute to general Budget revenues; and 3. certain transactions which are netted in published totals of the receipts and payments of the Public Account are shown in gross form. The more important of these are interest on loans raised by the Commonwealth Government for State works programs and for the Australian National Airlines Commission and Qantas Airways Ltd. Interest paid on these loans is included under the outlay heading 'Public Debt Interest', while interest received on advances made to the relevant authorities is included as a receipts item. This has the effect of making the coverage of interest in the Statements the same as the coverage of the debt to which it relates. Changes in the Functional Classification From time to time, changes need to be made in the functional classification to reflect changes in the organisation and coverage of government activities. The more significant changes made this year are: {: type="a" start="a"} 0. *Children's Services Program.* Under this program capital and recurrent assistance is provided to the States for child-care projects (including home care, vacation and after-school care projects) and for pre-schools. The Government has announced that in future increased emphasis will be placed on the childcare aspect of the program. Some projects, under the program combine both, child-care and pre-school aspects and there is difficulty in obtaining consistent data, over several years, to allow a dissection of expenditure between thechildcare services (which, primarily, serve a Social Security and Welfare purpose) and pre-schools (which, primarily, serve an Education purpose). As a consequence outlays under this program have been reclassified in total from Education' to 'Social Security and Welfare'. The associated administrative costs now are included under the General Administration heading in the Social Security and Welfare function. 1. *Northern Territory Administration.In* the past, Commonwealth expenditures in the Northern Territory have been classified to the relevant functional blocks (health, education, etc.), rather than grouped together under a single Northern Territory heading. On 1 January 1977 executive responsibility for some functions, previously administered by the Department of the Northern Territory, was transferred to the Northern Territory Legislative Assembly. Funds for these functions are being provided to the Northern Territory Legislative Assembly in the form of two block amounts, with responsibility for the allocation of these amounts among particular functions residing with the Northern Territory Legislative Assembly. Outlays from the allocations to be provided to the Northern Territory Legislative Assembly in 1977-78 have not, therefore, been allocated across the functional headings in Statement No. 3; these amounts have been classified to a new sub-heading 'Allocation to the Northern Territory Legislative Assembly' under function 9E 'General Public Services - Administrative Services'. Other expenditures by the Commonwealth in or for the Northern Territory, continue to be classified to the relevant function. This treatment of Northern Territory outlays will be revised as the the transition to self-government continues. As a consequence of changed administrative arrangements and problems of data availability, it has been necessary to make some changes in the composition or presentation of the various outlay blocks. Where appropriate these have been footnoted in the tables. Because the functional classification is derived largely from the appropriation accounting system, adjustments to the historical series are constrained by availability of suitable data in that system. In particular, the major changes to departmental administrative arrangements announced in December 1972, June 1974, June 1975, and December 1975, have made it difficult to produce a strictly consistent series of outlay aggregates for the periods covered in the Budget Statements. Where possible, the more important discontinuities have been eliminated by sub-costing and regrouping appropriation data, but it has not been practicable to eliminate all inconsistencies and produce an entirely comparable series. This should be borne in mind when examining the tables in Statement No. 3 and, more particularly, Statement No. 6. For these reasons, considerable care must be exercised when comparing functionally classified data in the 1977-78 Budget Statements with those in Budget Statements for earlier years. {:#subdebate-77-1} #### Description of Functions The following notes describe briefly the scope of the net outlays encompassed under each functional heading. {: type="1" start="1"} 0. *Defence* Outlays on military defence, including outlays to keep the armed services in a state of readiness. Includes outlays on central administration and on research in connection with activities carried out for defence purposes; outlays on military construction and equipment, inspection, transport and storage; all outlays on recruiting, training, equipping and housing the armed forces, and on medical care and other services for them; outlays on military colleges; expenditure for the provision of quarters for families of military personnel; outlays on pensions and other payments for military personnel under the Defence Forces Retirement and Death Benefits Scheme; outlays on civil defence; outlays on foreign military aid and contributions to international military organisations and alliances. {: type="1" start="2"} 0. *Education* Outlays on the provision, management and support of all levels of educational services, including schools, trade and technical courses, courses in music, fine arts, university and other higher education. Includes outlays relating to the provision of scholarships and allowances to students at all levels; special educational programs designed specifically for the benefit of Aboriginal students, for migrants and for handicapped children; expenditure on non-vocational adult education courses, school bus services and general administration, regulation and research activities related to education. {: type="1" start="3"} 0. *Health* Outlays on facilities or services for the prevention and treatment of human illness. Includes outlays related to the prevention of diseases, such as chest X-ray campaigns, immunisation and vaccination programs, regulation of standards of sanitation, etc.; outlays concerned with the provision of hospital and clinical services, including treatment and care of those suffering from psychiatric disorders, infectious diseases, etc., and expenditure on nursing schools associated with hospitals. Also includes the payment of hospital, nursing home, medical and pharmaceutical benefits which are designed to cover all or part of the costs of hospitalisation and medical treatment and care of specific groups, such as persons of Aboriginal descent, the aged, former members of the armed forces and their dependants; community health centres, centres for the treatment of drug addicts, and domiciliary care services; general administration, regulation and research related to health matters. {: type="1" start="4"} 0. *Social Security and Welfare* Provision of pensions and allowances and other benefits to persons who, because of age, physical or mental disability, domestic circumstances or other reasons, are unable or not expected to earn a sufficient livelihood for themselves and their dependants. Includes the provision of benefits such as unemployment benefits, age and repatriation pensions, accident and sickness benefits, other benefits to compensate for loss of income, and unemployment relief schemes. Provision of financial assistance towards the expenses associated with the bearing and raising of children, child care and pre-school facilities in the States, marriage guidance, other social security benefits, child welfare services and institutions, homes for and care of the aged and disabled and welfare programs to meet specific needs of disadvantaged groups. {: type="1" start="5"} 0. *Housing* Outlays on the provision of dwellings for sale or rental, and mortgage financefor purchase or construction of dwellings, other financial assistance aimed at facilitating the purchase or construction of dwellings or home ownership. General administration, regulation and promotion of standards, and research in the field of housing. {: type="1" start="6"} 0. *Urban and Regional Development nec and the Environment* Urban and Regional Development nec: Outlays on general promotion and assistance for urban and regional planning and development. Includes outlays on the development of new cities or towns where it is not possible to distinguish expenditure as specifically for housing, roads, sewerage or other purposes, or it is not appropriate to classify the expenditure to other categories (such as in the case of major urban sub-division or renewal outlays, including the purchase of land for such purposes). Administrative costs of departments and agencies engaged in urban and regional planning and development and environmental activities together with miscellaneous outlays including those on the provision of community amenities. Environment: Outlays on water quality control, air pollution and monitoring and other outlays related to pollution prevention and protection of the environment including identifiable outlays on research, planning and investigation. Sewerage and Sanitation: Outlays on the treatment and disposal of sewage, refuse collection and disposal. {: type="1" start="7"} 0. *Culture and Recreation* Outlays related to the support of performing and creative arts; support of organisations concerned with sporting and other leisure-time activities, and provision of facilities serving purposes primarily related to these activities, such as swimming pools, community centres, athletic fields, etc.; contributions to youth and social organisations; outlays on the protection and preservation of historic sites and buildings, parks and wildlife reserves, and other elements of the national estate; outlays on the provision and operation of government radio and television broadcasting services. {: type="1" start="8"} 0. *Economic Services* This category covers regulation of and assistance provided to, the private sector; direct government participation in economic activity and provision of economic infrastructure. {: type="A" start="A"} 0. *transport and Communication.* Outlays concerned with postal services, and domestic and overseas telecommunications; outlays on construction, maintenance, promotion, administration and research relating to the various modes of land, sea and air transport, including urban transportation systems and pipelines for petroleum and gas transport. (Road traffic control services are shown under the category 'Law, Order and Public Safety'.) 1. *Water Supply and Electricity.* Outlays on construction and other assistance, regulation and research in connection with the production, transmission and distribution of electricity; and on the conservation, collection, purification and distribution of water primarily for domestic and industrial consumption. 2. *Industry Assistance and Development.* Direct assistance to primary, secondary or service enterprises in forms such as bounties, subsidies, export incentives, advances from the Budget and other transfers including payments to ensure guaranteed prices for commodities or to maintain the prices of commodities below their normal market price; support of agricultural and other industrial research and development and of promotional activities including export promotion; outlays on the management of timber and fishery resources; provision of veterinary, extension and other services to agriculture; land clearing, reclamation and settlement activities; outlays on programs of rural debt reconstruction and farm rehabilitation; investigation, measurement, development and management of water resources for irrigation and pastoral purposes and rural flood mitigation; assistance and encouragement of mineral exploration; geological surveys; development of tourist facilities and tourist promotion; administration, promotion, regulation and research, directly associated with specific primary, secondary or service industries. 3. *Labour and Employment.* Outlays related to the regulation of working conditions, the prevention and settlement of industrial disputes and the enforcement of industrial awards and agreements; programs designed to facilitate changes of occupation by persons displaced by redundancy, occupational training schemes for adults including assistance to enter or re-enter the work-force, provision of labour exchange facilities; outlays directly related to the assisted passage migration scheme; general administration, regulation and research in the field of labour affairs. 4. *Other Economic Services.* Outlays related to regulation of monopolies and restrictive trade practices, price control and justification, regulation of the tariff, other forms of business regulation; outlays on patents and trade marks administration, outlays on meteorological services and other technical services not allocable to specific kinds of industry; outlays on general administration in the area of economic and commercial affairs not allocable to other outlay categories within the 'Economic Services' function. {: type="1" start="9"} 0. *General Public Services* This category covers outlays on a number of general public services and activities concerned with the organisation and operation of government. {: type="A" start="A"} 0. *Legislative Activities.* Outlays of the legislative and executive bodies of government, including parliamentary committees and the operation of the Governor-General's establishments; outlays related to the conduct of elections and maintenance of registers of voters. 1. *Law, Order and Public Safety.* Outlays on law courts (other than those concerned with industrial relations) and bodies concerned with the administration of the legal system and preparation and execution of law court action; provision of legal aid; registration of legal titles to property; outlays in respect of prisons and other places of detention and correction, and probation services; police services, including traffic control; fire protection and other public safety promotion or services; general administration and research related to these activities. 2. *Foreign Affairs and Overseas Aid.* Outlays of departments and agencies charged primarily with the handling of foreign relations; administration and other expenditure relating to external territories; and outlays on foreign economic aid and contributions to international bodies other than military alliances and organisations. 3. *General and Scientific Research.* Contributions for the promotion of and outlays on, basic and general research in the biological, physical and social sciences, which cannot readily be classified to other outlay categories or linked with the provision or promotion of a particular service or activity. 4. *Administrative Services.* Outlays on the collection of taxes, raising public loans, managing public debt, and controlling the disbursement and audit of public funds. Outlays on general services for the government as a whole, such as statistical services, the purchase and operation of government buildings and equipment (including the construction, repair and maintenance of general purpose buildings) , rent, office cleaning, personnel and other administration. General purpose allocations to the Northern Territory Legislative Assembly to cover expenditure on functions for which executive responsibility is transferred to the Assembly on 1 January 1977 are included here. General administrative expenses of departments covering a variety of government activities and which cannot be readily apportioned over relevant functions are also included under this heading. {: type="1" start="1"} 0. *Outlays Not Allocated to Function* 5. *Payments to or for the States and to Local Government Authorities nec and Natural Disaster Relief.* General purpose grants and advances to State and other local government authorities which may be spent at the recipient's discretion and grants not classifiable to specific functions. This category includes payments to assist the States to meet debt charges. Payments to States and direct assistance for the relief of victims of drought, flood, fire and other natural disasters, and for the restoration of community services and facilities. Long run specific reconstruction is, to the extent possible, classified according to purpose. {: type="A" start="B"} 0. *Public Debt Interest.* Net interest payments made from the budget sector to other sectors, including interest payments on government securities, or under credit arrangements with other countries. Interest received from Government investments in Commonwealth Government securities if offset against gross interest payments. {: .page-start } page 243 {:#debate-78} ### APPROPRIATION BILL (No. 2) 1977-78 Message from the Governor-General recommending appropriation for proposed expenditure announced. Bill presented by **Mr Lynch,** and read a first time. {:#subdebate-78-0} #### Second Reading {: #subdebate-78-0-s0 .speaker-KIM} ##### Mr LYNCH:
Treasurer · Flinders · LP -- I move: >That the Bill be now read a second time. This Bill contains details of proposed appropriations of the Consolidated Revenue Fund in 1977-78 totalling $1,329,969,000 for expenditure on the construction of public works and buildings, the acquisition of sites and buildings, advances and loans, items of plant and equipment which are clearly definable as capital expenditure, grants to the States under section 96 of the Constitution, and new policies not authorised by special legislation. Included in the above total is an amount of $108m as an Advance to the Treasurer for the purposes set out in the Bill. The proposed expenditures for which appropriations are sought in this Bill were dealt with as appropriate in my Budget Speech. I commend the Bill to honourable members. Debate (on motion by **Mr E.** G. Whitlam) adjourned. {: .page-start } page 243 {:#debate-79} ### BUDGET 1977-78 {: #debate-79-s0 .speaker-KIM} ##### Mr LYNCH:
Treasurer · Flinders · LP -I present the following papers for the information of honourable members in connection with the Budget for 1977-78: >Estimates of Receipts and Summary of Estimated Expenditure for the year ending 30 June 1 978. {:#subdebate-79-0} #### Civil Works Program 1977-78 Government Securities on Issue at 30 June 1 977. Payments to or for the States and Local Government Authorities 1977-78. {:#subdebate-79-1} #### Australia's Official Development Assistance to Developing Countries 1977-78 {:#subdebate-79-2} #### National Income and Expenditure 1976-77 {:#subdebate-79-3} #### National Accounting Estimates of Receipts and Outlays of Commonwealth Government Authorities {:#subdebate-79-4} #### Income Tax Statistics Ordered that the papers be printed. {: .page-start } page 243 {:#debate-80} ### POSTAL AND TELECOMMUNICATIONS COMMISSIONS {: #debate-80-s0 .speaker-KZL} ##### Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP -- I present the following papers for the information of honourable members: >The Australian Postal Commission- Service and Business Outlook for year 1977-78. > >The Australian Telecommunications CommissionService and Business Outlook for year 1977-78. Ordered that the papers be printed. {: .page-start } page 243 {:#debate-81} ### TARIFF (COAL EXPORT) PROPOSALS {: #debate-81-s0 .speaker-CG4} ##### Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP -- I move: {:#subdebate-81-0} #### Customs Tariff (Coal Export Duty) Proposals ( 1977) Customs Tariff (Coal Export Duty) Proposals (1977) which I have just tabled introduce the tariff changes on coal foreshadowed by my colleague the Treasurer **(Mr Lynch)** in his Budget Speech earlier this evening. The changes reduce the export duty on high quality coking coal from $4.50 per tonne to $3.50 per tonne and reduce the export duty on coking coal other than high quality coking coal from $1.50 per tonne to $1.00 per tonne. These changes will be effective in relation to all exports after 8 o'clock this evening. I commend the proposals. Debate (on motion by **Mr Keating)** adjourned. {: .page-start } page 243 {:#debate-82} ### TARIFF PROPOSALS {: #debate-82-s0 .speaker-CG4} ##### Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP -- I move: >Excise TariffProposals No. 2 (1977) and Customs Tariff Proposals No. 24 (1977). Excise TariffProposals No. 2 (1977) and Customs Tariff Proposals No. 24 (1977) which I have just tabled introduce the Excise Tariff and Customs Tariff changes relating to crude oil, condensate when mixed with crude oil, and certain refined petroleum products, foreshadowed by my colleague the Treasurer **(Mr Lynch)** in his Budget Speech earlier this evening. The proposals which will operate on and after 8 o'clock this evening increase the excise duties on crude oil, and condensate when mixed with crude oil by 50 per cent, the excise and customs duties on the refined petroleum products by one quarter of a cent per litre, and exempt from excise duty condensate when marketed separately from crude oil. I commend the proposals. Debate (on motion by **Mr Keating)** adjourned. {: .page-start } page 243 {:#debate-83} ### DIESEL FUEL TAX (No. 1) AMENDMENT BILL 1977 Bill presented by **Mr Fife,** and read a first time. {:#subdebate-83-0} #### Second Reading {: #subdebate-83-0-s0 .speaker-CG4} ##### Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP I move: >That the Bill be now read a second time. The purpose of the Bill I have just introduced is to make to the Diesel Fuel Tax Act (No. 1 ) 1957 an amendment which is consequential to alterations in customs and excise duties on refined petroleum products contained in tariff proposals introduced earlier tonight. The Bill increases by a quarter of a cent per litre the tax payable on diesel fuel which is sold or otherwise disposed of to a person who is not the holder of a certificate certifying requirement of diesel fuel for purposes other than for road use. I commend the Bill. Debate (on motion by **Mr Keating)** adjourned. {: .page-start } page 244 {:#debate-84} ### DIESEL FUEL TAX (No. 2) AMENDMENT BILL 1977 Bill presented by **Mr Fife,** and read a first time. {:#subdebate-84-0} #### Second Reading {: #subdebate-84-0-s0 .speaker-CG4} ##### Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP -I move- >That the Bill be now read a second time. The purpose of this Bill is to make to the Diesel Fuel Tax Act (No. 2) 1957 an amendment which is consequential to alterations in customs and excise duties on refined petroleum products contained in tariff proposals introduced earlier tonight. The Bill increases by a quarter of a cent per litre the tax payable on diesel fuel purchased by a certificate holder for an 'exempt' purpose but which is subsequently used in propelling a road vehicle on a public road. I commend the Bill. Debate (on motion of **Mr Keating)** adjourned. {: .page-start } page 244 {:#debate-85} ### LIQUEFIED GAS (ROAD VEHICLE USE) TAX AMENDMENT BILL 1977 Bill presented by **Mr Fife,** and read a first time. {:#subdebate-85-0} #### Second Reading {: #subdebate-85-0-s0 .speaker-CG4} ##### Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP -- I move: The purpose of the Bill I have just introduced is to increase by one-eighth of a cent per litre the present tax of 2c per litre on liquefied gas used for propelling road vehicles. The increase is complementary to the increases in duties on refined petroleum products foreshadowed by my colleague the Treasurer **(Mr Lynch)** in his Budget Speech and contained in tariff Proposals introduced earlier this evening. The increased rate is to apply in respect of liquefied gas that is used for road vehicle propulsion on and from 17 August 1977. 1 commend the Bill. Debate (on motion by **Mr Keating)** adjourned. {: .page-start } page 244 {:#debate-86} ### CRUDE OIL POLICY {:#subdebate-86-0} #### Ministerial Statement {: #subdebate-86-0-s0 .speaker-BU4} ##### Mr ANTHONY:
Minister for National Resources and Minister for Overseas Trade · Richmond · NCP/NP -- by leave- It was announced in the Budget Speech earlier tonight that the Government is introducing new arrangements for the pricing and taxation of crude oil produced from presently known Australian fields. For several years I have been arguing that energy in Australia is unrealistically priced. The price of petrol here is less than half the price in countries like Japan, France and Italy. While consumers would welcome the continuation of this situation, the fact is that it cannot continue. The quadrupling of international oil prices in 1973-74 ushered in a new and disturbing realisation of the essential role oil plays in the standard of living the world either enjoys or aspires to. Events since then have reinforced that realisation. Oil plays a key role in the transport on which the modern world depends. It is also the energy source for which we face the most critical shortages. President Carter's energy statement contained the estimate that on current trends, demand would overhaul supply some time around the mid 1980s. Nobody seriously questions this forecast. If this situation is permitted to occur, the market price for oil will be anyone's guess. Governments the world over must make every attempt to forestall such a demand-supply squeeze. They must take active steps to mitigate the effects of dearer oil- a certainty whether or not world demand outpaces availability. Oil supplies 45 per cent of the world's energy needs and 47 per cent of Australia's. It will remain for decades the most important energy source. It is at the heart of any country's energy policy. I am currently preparing a statement which will deal comprehensively with all forms of energy. That statement will be presented to the House as soon as practicable. The matters discussed in this present statement form an integral part of that forthcoming statement of energy policy. For Australia, our central energy policy objectives must be threefold. Firstly, we must encourage oil exploration and development. Secondly, we must encourage greater economies of energy usage and encourage people to use other fuels in preference to oil. Thirdly, we must foster a more intensive search for alternatives to oil. Each of these objectives requires the price to be increased. That is why I have constantly argued that we should move gradually and predictably towards higher oil prices. This approach allows us to avoid the large, abrupt, destabilising increases which would otherwise occur. Price is not the only instrument available to promote our policy. Clearly the Government can and will exhort consumers to reduce their usage of oil products in the national interest. But realistic pricing remains critical to the success of a policy. Energy saving measures like, for example, insulation of houses, need to become recognised money-saving propositions. Higher priced oil will also assist in bringing about the economic introduction of alternative energy technologies such as coal conversion and solar power. A higher price will raise the return on successful exploration. An improved return on investment provides a strengthened encouragement for exploration; moreover, we would expect that higher earnings by existing producers will be ploughed back into further exploration here in Australia. The Treasurer **(Mr Lynch)** has given a general outline of the new arrangements. I will now describe in some additional detail the pricing, allocation, and levy arrangements, and deal briefly with the question of their likely impact. As already announced, the Government has decided to implement a scheme which will take the price of indigenous crude oil from presently known fields in the direction of import parity. This will be achieved through a uniform method of price determination. The new scheme will apply to each presently known field in Australia and will apply from midnight tonight. Producers will receive die import parity price, determined by the Government every six months, for a specified part of their production. Import parity will be received for either the first six million barrels of oil produced from each field per annumcalled the 'basic allowance'- or a proportion of production per annum, rising over time according to a specified schedule, whichever is the greater in any particular case. The schedule is 10 per cent from tomorrow until the end of the present financial year, rising to 20 per cent for the financial year 1978-79, 35 per cent for financial year 1979-80 and 50 per cent for financial year 1980-81. For all additional production from each field or new development, the producers will receive the price which was current up to the time of the introduction of the new arrangements. That is $2.33 per barrel in the case of the Bass Strait fields and $2.88 per barrel in the case of the Barrow Island field. All production from the Moonie and Alton fields and other small fields will, in practice, receive import parity prices, as the output from those fields will be well below six million barrels per annum. The Government will review the position before June 1981 to decide the rate at which the further progression to full import parity for presently known fields should take place. Oil from fields discovered after 14 September 1975 will continue to receive full import parity. The present crude oil absorption policy, whereby all crude oil produced in Australia is required to be processed in Australian refineries, will be continued. Indigenous crude oil, with its high yield of light fractions, is ideally suited to the local market demand. The export of the indigenous crude oil would therefore simply mean the exchange of our own oil for another, probably less suitable, imported oil. The existing embargo on exports of crude oil will therefore remain in force. The Government is, in any case, under an obligation to continue the present crude oil absorption policy and associated allocation arrangements until at least 1980. This is because most refineries have undertaken considerable plant investment on the basis of that policy and to prematurely abandon it or phase it out would arbitrarily disadvantage a substantial section of the oil refining industry. The import parity price will be set every six months by the Commonwealth Government. It will be calculated on the basis of the price of Arabian light oil at the nearest refinery port, adjusted to allow for an appropriate quality differential. This differential will take account of the suitability of indigenous crude oil for the local market. For the period until 3 1 December 1977, the import parity price will be set at $13 per barrel. Officers of the Department of National Resources will be having discussions with the oil industry in the near future to determine the precise basis on which the import parity price should be calculated in future periods. The new pricing arrangements give a consistent set of ground rules applicable to all present and future developments in existing fields. They will remove any apparent arbitrariness inherent in the previous method of price determination. The basic allowance will apply to the combined existing developments in each presently known field and to each substantial new development in such fields. The figure of six million barrels per annum has been selected to ensure that new developments will immediately receive import parity prices for all or most of their production. It will ensure firstly that different producers are treated equitably and, secondly, that adequate recognition is given to the fact that oil from the smaller fields is typically more costly to produce than oil from the larger fields. As already announced, the crude oil levy will be increased by $ 1 per barrel to $3 per barrel. The levy will be deducted from the price for import-parity oil, and added to the price for below-import-parity oil. In effect, therefore, producers will pay the levy on import-parity oil, and consumers will pay the levy on belowimportparity production. The likely effects on prices, company profits, and Government revenues of the new arrangements were mentioned in the Budget Speech. The new arrangements will increase the prices received by existing producers approximately as follows: For the remainder of 1977, the average price for all Bass Strait fields already in production, net of the crude oil levy, will be about $3.20 per barrel. For Barrow Island, the average price received will be about $6.60, and for Moonie the price received will be $10 per barrel. If world prices rise at 6 per cent per annum and no further changes are made in the levy arrangements, corresponding net prices by 1979-80 could be of the order of $6.20, $7.30 and $11.60 for Bass Strait, Barrow Island and Moonie respectively. The net prices in the early period would be somewhat lower than the prices which would have resulted from acceptance of the precise Industries Assistance Commission recommendations. The new arrangements will immediately increase the average price into Australian refineries of all oil including imports by an estimated 25 per cent. While the actual extent of any petroleum product price increase will be a matter for the Prices Justification Tribunal, the resultant increase will probably be of the order of 2½c per litre on the price of regular motor spirit. On this basis, the recommended price of regular motor spirit in Sydney would rise to approximately 1 9c per litre. The Government is, of course, most reluctant to increase the price of petroleum products to Australian consumers. But the option of maintaining indefinitely a low price for the bulk of Australian refinery feedstocks is simply no longer available to us. It needs to be recognised that the Australian consumer has been paying less than the real value of the petroleum he uses. Furthermore, over the phasing-in period he will continue to pay less than in most overseas countries. Compared to the new likely price of 19c per litre in Sydney, the French motorist pays 39c, the Japanese motorist pays 38c, and the German, Swedish and British motorists all pay over 30c. Petrol prices in Australia remain considerably below the 25c per litre in New Zealand and are now at roughly the same level as Canadian prices. Only the United States among major Western countries has cheaper petrol than Australia and the thrust of President Carter's energy policy is to increase the price of oil products to American consumers. It must be recognised that our decision to move towards import parity pricing for known crude oil merely hastens the inevitable. In the next few years, production from the Bass Strait fields will begin to decline as those fields approach the end of their economic life. These fields comprise 90 per cent of present day Australian production. Hence oil produced overseas, imported at prevailing world prices, will account for an increasing proportion of the input to Australian refineries. Furthermore, should more oil be discovered in Australia, it is already established Government policy that that oil will be priced at full import parity. The new arrangements will effectively increase the amount of oil available from presently known fields. There are over 400 million barrels of oil, or two years worth of consumption, locked up in fields and not economically extractable at current prices. Australia cannot afford to leave this oil m the ground. The basic allowance of 6 million barrels per annum of oil at import parity prices for each new development will provide an assurance that these reserves can be extracted. There are several considerations other than basic energy policy considerations which the Government has necessarily had to take into account when formulating its new policy. One is the Government's overriding aim of lowering the rate of inflation and raising the level of activity in the economy generally. There is a need also to avoid the significant dislocation which could be expected to follow as particular industries suffered large cost increases. It is for these reasons that the Government has decided to increase prices gradually rather than all at once. The new arrangements will result in very substantial increases in the profits of each of the current producers. For this reason the Government is considering the application of a resources tax to these profits. Accordingly the Government will be seeking early discussions with the relevant oil producing companies on these matters. Any decision on the future of the crude oil levy will be taken in the light of decisions on the resource tax. The Government considers that the new pricing arrangements represent the most appropriate way of bringing Australian oil prices to world levels. The new taxation arrangements will aim to achieve an appropriate division between producers in the form of net returns, and the Government- and hence the taxpayer- in the form of taxation revenue. Over the transitional period, the Australian consumer of petroleum products will, for some years, be able to pay prices based on crude oil prices below the price of imported crude. Many other countries in a less fortunate position than Australia have had to adjust to the hard reality of high oil prices very rapidly. Our own oil reserves will allow us to adjust gradually, and consequently at less cost in terms of disruption. But we must take advantage of the time these reserves have allowed us to adjust our oil consumption habits and to prepare substitutes for imported oil. I present the following paper: {:#subdebate-86-1} #### Crude Oil Policy-Ministerial Statement, 16 August 1977 Motion (by **Mr Sinclair)** proposed: >That the House take note of the paper. {: #subdebate-86-1-s0 .speaker-NH4} ##### Mr KEATING:
Blaxland -In reply to the statement made by the Minister for National Resources **(Mr Anthony),** I want to say briefly that what we have heard in the last few minutes was virtually a home town decision by the Government in support of its corporate friends when it has had a year to consider the report of the Industries Assistance Commission, which was presented in September last year. The Opposition has announced on other occasions that it is sympathetic to the general thrust of the IAC report where increases in the price of crude are accompanied by the presence of a secondary taxing structure. But what we have heard tonight represents an increase of 1 lc a gallon in the price of fuel to the Australian consumer, to the motorist in the city and to the farmer, and a massive increase in profitability for the main producers of oil in Australia, the Esso-BHP consortium in Bass Strait. The Minister said in his speech that the Government is considering the application of a resources tax on these profits and that, accordingly, the Government will be seeking early discussions with the relevant oil producing companies on the matter. That is not good enough. The Government was presented with the IAC report 12 months ago and that report canvassed a secondary taxing or royalties system. The Treasury should have been instructed to present the Government forthwith with a number of taxing scenarios which the Government could have considered for simultaneous introduction with these proposals. Not only do we find that that is not the case, but also that the real story is hidden. There is no express mention in the Minister's statement of the kind of profitability which will flow to the companies by virtue of these decisions. On my quick estimate, from BHP and Esso, the Bass Strait producers, which have three fields which qualify under the 6 million barrels a year provision, there will be approximately 13 million barrels in respect of which the Government is offering import parity of $13. Taking into account the present price of $2.30, as well as the $3 a barrel, the benefit will be about $7.70 a barrel over 13 million barrels. That means that the Government has put $ 100m in excess profits into the hands of Esso and BHP without any express commitment to spend that money on new exploration. The Minister said that he hopes there will be new exploration. He should have insisted. There should have been an express provision that the money given to the companies would be spent in that way. As well, massive additional revenue will flow to the Government from these arrangements. That additional revenue should have been spent on alternative energy technology and research into alternative energy resources, but that was not mentioned in the statement. I believe that it is a very inadequate statement. It is a home town decision for Esso-BHP and the other oil producers. The Government ought to be ashamed. It has had 12 months to introduce a taxing system and it has failed to measure up to the challenge. I seek leave to continue my remarks at a later stage. Leave granted; debate adjourned. House adjourned at 9.54 p.m. {: .page-start } page 248 {:#debate-87} ### ANSWERS TO QUESTIONS UPON NOTICE The following answers to questions upon notice {:#subdebate-87-0} #### Medical Claims Paid by Commonwealth (Question No. 1571) (Supplementary information to that published in Hansard 3 December 1976.) {: #subdebate-87-0-s0 .speaker-SH4} ##### Dr Klugman: asked the Minister for Health, upon notice, on 1 1 November 1976: {: type="1" start="1"} 0. 1 ) How many medical claims were paid by the Commonwealth and/or Medibank, including Pensioner Medical Service claims, for the half years ended (a) 30 June 1974, (b) 3 1 December 1974, (c) 30 June 1975, (d) 31 December 1975 and (e) 30 June 1976. 1. What was the number of claims for each State and Territory in the categories of services used in his answer to my question No. 816. ere circulated: {: #subdebate-87-0-s1 .speaker-GH4} ##### Mr Hunt:
Minister for Health · GWYDIR, NEW SOUTH WALES · NCP/NP -- The answer to the honourable member's question is as follows: >In my reply to this question published in *Hansard* of 3 December 1976 I undertook to provide the honourable member with the additional information he requested as soon as it could be extracted. > >The following table sets out the available information. Details of the categories of services distinguishing as between specialists ana general practitioners are not available for Commonwealth Medical Benefits services. All Pensioner Medical Service Benefits services are regarded as general practitioner consultations. {:#subdebate-87-1} #### Costs of High Court Judgments (Question No. 72) {: #subdebate-87-1-s0 .speaker-2V4} ##### Mr Clyde Cameron:
HINDMARSH, SOUTH AUSTRALIA · ALP asked the AttorneyGeneral, upon notice, on 9 March 1977: {: type="1" start="1"} 0. 1 ) What is the cost to the public of copies of judgments of the High Court of Australia. 1. ) When were the costs last increased and what were they previously. 2. What was the cost to a member of the public of the judgments involving: {: type="a" start="a"} 0. the Seas and Submerged Lands Act 1. b ) the Territory Senators case and 2. McKinlay'scase. 3. How does this compare with costs of judgments of other Courts such as the Supreme Court of New South Wales. 4. Can steps be taken to enable copies of judgments of the High Court to be available at a reasonable cost, say $5 maximum, on or soon after the day of delivery. {: #subdebate-87-1-s1 .speaker-YF6} ##### Mr Ellicott:
Attorney-General · WENTWORTH, NEW SOUTH WALES · LP -- The answer to the honourable member 's question is as follows: {: type="1" start="1"} 0. 1 ) Item 8 of the Third Schedule to the High Court Rules reads: Reasons for judgment given by a Justice or the Full Court in a proceeding- for each copy issued to a person not a party to the proceeding and for each copy in excess of one copy issued to a party to the proceeding- per page $0.50 ' {: type="1" start="2"} 0. The present fee took effect from 1 February 1968. The previous fee, set in 1953, was: For a copy of reasons for judgment of a Justice or a Court, per folio............... 6d. But with a minimum fee, for one set of reasons of . . 5s. And with a maximum fee, for one set of reasons, of............... £10/ 10s. {: type="1" start="3"} 0. (a) $117 {: type="a" start="b"} 0. $70 1. $60. 1. I do not have the information relating to State Courts and cannot make any comparisons. 2. The Chief Justice has proposed a substantial change in the method of reproducing the judgments of the Court which could make them more readily and more cheaply available to the parties and certain institutions such as Courts, libraries, professional bodies and universities and at a reduced cost to other persons and bodies. Married Women in Work Force (Question No. 93) {: #subdebate-87-1-s2 .speaker-2V4} ##### Mr Clyde Cameron:
HINDMARSH, SOUTH AUSTRALIA · ALP asked the Minister for Employment and Industrial Relations, upon notice, on 9 March 1977: >Does he have any statistics to indicate which countries have a higher percentage of married women among its employed persons in the workforce than is the case in Australia; if so, what are the countries. {: #subdebate-87-1-s3 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: >Information on the percentage of married women among employed persons in the workforce is available, in respect of 10 of the 24 OECD countries (including Australia), from the OECD publication Labour Force Statistics, 1963-1974 (Paris, 1976), and is presented below. It can be seen that most of the countries for which information is available have a higher proportion of married women among their employed workforce than does Australia. > >Statistics of employed civilians include the armed forces. > >It should be noted that because of differences between these OECD countries in the matter of general concepts, classifications, and the methods used to obtain labour force statistics and employment data, the comparisons presented here should be treated with caution and should be regarded as merely approximate. Details of these differences can be obtained from the OECD publication referred to above. Indexation of Medibank Contribution: Effect on Wage Rates (Question No. 96) {: #subdebate-87-1-s4 .speaker-2V4} ##### Mr Clyde Cameron:
HINDMARSH, SOUTH AUSTRALIA · ALP asked the Minister for Employment and Industrial Relations, upon notice, on 9 March 1977: {: type="1" start="1"} 0. 1 ) What increase would accrue to a person receiving (a) the average award rate for adult males; (b) the award rate for a tool-maker; and (c) the salary payable to a Level 6 officer of the Australian Public Service, if the Conciliation and Arbitration Commission decides to index these incomes by 3.2 per cent to compensate for the cost of compulsory contributions to Medibank. 1. What percentage of the compulsory Medibank contribution will a 3.2 per cent wage or salary increase represent for each of the classifications listed in part ( 1 ). {: #subdebate-87-1-s5 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: The honourable member will be aware that the Conciliation and Arbitration Commission on 31 March 1977 awarded an across the board increase of $5.70 per week in respect of the movement in the Consumer Price Index for the December quarter 1976. This amount included an adjustment of $2.90 per week to all award rates on account of the movement in the Consumer Price Index resulting from revised Health Insurance arrangements. {:#subdebate-87-2} #### Fourth Report of the Royal Commission on Petroleum (Question No. 144) {: #subdebate-87-2-s0 .speaker-CV4} ##### Mr Jacobi:
HAWKER, SOUTH AUSTRALIA asked the Prime Minister, upon notice, on 9 March 1 977: {: type="A" start="1"} 0. I ) Has his attention been drawn to a statement appearing in the Fourth Report of the Royal Commission on Petroleum that a deliberate campaign of public education on the scarcity of energy resources, together with practical advice as to how motor spirit may be conserved, is an essential precondition for public acceptance of policies of conservation, which will have to be implemented and which are likely to prove unpopular. {: type="1" start="2"} 0. If so, which Government department would have the responsibility for such a program. 1. Will he ask the responsible Minister to initiate an education campaign aimed at public acceptance of the need for motor spirit conservation. 2. As policies aimed at conserving petrol are likely to prove unpopular, will he give an assurance that his Government will act in the long-term national interest rather than take short-term opportunist decisions. {: #subdebate-87-2-s1 .speaker-QS4} ##### Mr Malcolm Fraser:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. Yes. 1. and (3) The Fourth Report of the Royal Commission on Petroleum has been considered by the Government. The Minister for Business and Consumer Affairs made a statement on 31 May concerning the Government's intentions with regard to the Royal Commission's recommendations. Responsibility for co-ordinating the Commonwealth's interest in energy matters rests with the Minister for National Resources and his Department, with a supportive role on conservation aspects from the Department of Environment, Housing and Community Development. The Minister for National Resources has advised me that at the first meeting of the Australian Minerals and Energy Council on 4 March 1977, the Commonwealth and State Ministers agreed that there was a need for the Commonwealth and the states to consult on a wide range of energy matters including matters relating to energy conservation. To facilitate these consultations, the Council agreed that its Advisory Committee of officials should set up small Task Groups to investigate and report to Council on agreed subjects. As a number of matters under the control of the States have a very important bearing on the effectiveness of any energy conservation program, the Commonwealth will be seeking the establishment of a Task Group to consider what steps would be desirable and feasible in this area. The recently established National Energy Advisory Committee will also have an important role to play both in advising on what is technically feasible in regard to energy conservation, and in stimulating public awareness of the need for energy conservation. {: type="1" start="4"} 0. The Government will certainly act in the long term national interest in this matter. Ministerial Visits to the Republic of Korea (Question No. 196) {: #subdebate-87-2-s2 .speaker-6U4} ##### Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP asked the Prime Minister, upon notice, on 9 March 1977: >What were the date, duration and purpose of each visit to the Republic of Korea by any of his present Ministers in the last 12 years. {: #subdebate-87-2-s3 .speaker-QS4} ##### Mr Malcolm Fraser:
LP -- The answer to the honourable member's question is as follows: >An examination of records shows that the following Ministerial visits to the Republic of Korea have taken place in the last 12 years: {:#subdebate-87-3} #### Unemployment Registrations: Western Sydney (Question No. 220) {: #subdebate-87-3-s0 .speaker-6U4} ##### Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP am asked the Minister for Employment and Industrial Relations, upon notice, on 9 March 1977: {: type="1" start="1"} 0. 1 ) How many persons were registered as unemployed at the end of January 1976 and at the end of January 1977 in the Electoral Divisions of (a) Chifley, (b) Macarthur, (c) Macquarie, (d) Mitchell, (e) Parramatta, (f) Prospect and (g) Werriwa. 1. What percentage of the persons was (a) males and (b) females (i) under 2 1 years of age and (ii) 2 1 years of age and over. 2. What were the principal work categories of the persons registered as unemployed. {: #subdebate-87-3-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: >Statistics of unemployed persons registered with the Commonwealth Employment Service (CES) are normally compiled according to individual Employment Office areas. It is not usual for the boundaries of these to coincide with the boundaries of parliamentary electorates and in the majority of cases parts of several Employment Office areas would be contained in any one electorate. Conversely, however, some Employment Offices either contain a single electorate or parts of more than one electorate within their boundaries. > >It is possible to state roughly the proportion of each CES Office area contained in a particular electorate and to provide statistics relating to the total number of persons registered as unemployed in each of those Offices. Any attempt to apply the relative proportions to these total figures, however, in an effort to obtain an estimate of the number of characteristics of the unemployed registrants in that electorate, would be misleading as the distribution of population and unemployment within each CES Office area is unlikely to be uniform. > >With this caveat in mind, as stated in my answer to the honourable member's question No. 219 of 9 March, 1977, 1 am prepared to provide statistics of the numbers, age and sex of persons registered as unemployed in Offices of the CES contained in the respective electorates as requested by the honourable member but, as statistics of occupational categories for which unemployed persons are registered are not normally published by CES Office areas, I do not consider that the considerable clerical effort involved in their extraction would be justified for part (3) of the honourable member's question. > >The following are the answers, in terms of CES Office areas, to pans (1) and (2) of the honourable member's question: > >1 ) (a) Pans of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Chifley as presently constituted, viz: Mt Drum, Blacktown and Penrith. The respective proportions of the three Employment Office areas involved are 40 per cent of Mt Druitt, 40 per cent of Blacktown and 10 per cent of Penrith. {: type="a" start="b"} 0. Parts of five Employment Office areas fall within the boundaries of the Federal Electoral Division of Macarthur as presently constituted, viz: Campbelltown, Warilla, Nowra, Goulburn and Wollongong. The respective proportions of the five Employment Office areas involved are 95 per cent of Campbelltown, 75 per cent of Warilla, 70 per cent of Nowra, 25 per cent of Goulburn and 20 per cent of Wollongong. {: type="a" start="c"} 0. Parts of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Macquarie as presently constituted, viz: Bathurst, Lithgow and Maitland. The respective proportions of the three Employment Office areas involved are 75 per cent of Bathurst, 65 per cent of Lithgow and 5 per cent of Maitland. {: type="a" start="d"} 0. Pans of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Mitchell as presently constituted, viz: Parramatta, Windsor and Blacktown. The respective proportions of the three Employment Office areas involved are 90 per cent of Parramatta, 75 per cent of Windsor and 40 per cent of Blacktown. {: type="a" start="e"} 0. Pans of four Employment Office areas fall within the boundaries of the Federal Electoral Division of Parramatta as presently constituted, viz: Ryde, Granville, Parramatta and Hornsby. The respective proportions of the four Employment Office areas involved are IS per cent of Ryde, 10 per cent of Granville, 5 per cent of Parramatta and 2 per cent of Hornsby. (0 Pans of six Employment Office areas fall within the boundaries of the Federal Electoral Division of Prospect as presently constituted, viz: Fairfield, Mt Druitt, Liverpool, Blacktown, Penrith and Parramatta. The respective proportions of the six Employment Office areas involved are 75 per cent of Fairfield, 50 per cent of Mt Druitt, 50 per cent of Liverpool, 15 per cent of Blacktown, 15 per cent of Penrith and 5 per cent of Parramatta. {: type="1" start="2"} 0. The percentage of persons who were (a) male and (b) female (i) under 2 1 years of age and (ii) 2 1 years of age and over for each of the Employment Office areas comprising the relevant Electoral Divisions at end- January 1976 and endJanuary 1 977 were as follows: {:#subdebate-87-4} #### Unemployment Registrations: Western Sydney (Question No. 221) {: #subdebate-87-4-s0 .speaker-6U4} ##### Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP am asked the Minister for Employment and Industrial Relations, upon notice, on 9 March 1977: {: type="1" start="1"} 0. 1 ) How many persons were registered as unemployed as at the end of February 1976 and the end of February 1977 in the Electoral Divisions of (a) Chifley, (b) Macarthur, (c) Macquarie, (d) Mitchell, (e) Parramatta, (f) Prospect and (g) Werriwa. 1. What percentage of the persons was (a) males and (b) females (i) under 2 1 years of age and (ii) 2 1 years of age and over. 2. What were the principal work categories of the persons registered as unemployed. {: #subdebate-87-4-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: >Statistics of unemployed persons registered with the Commonwealth Employment Service (CES) are normally compiled according to individual Employment Office areas. It is not usual for the boundaries of these to coincide with the boundaries of parliamentary electorates and in the majority of cases parts of several Employment Office areas would be contained in any one electorate. Conversely, however, some > >Employment Offices either contain a single electorate or parts of more than one electorate within their boundaries. > >It is possible to state roughly the proportion of each CES Office area contained in a particular electorate and to provide statistics relating to the total number of persons registered as unemployed in each of those Offices. Any attempt to apply the relative proportions to these total figures, however, in an effort to obtain an estimate of the number and characteristics of the unemployed registrants in that electorate, would be misleading as the distribution of population and unemployment within each CES Office area is unlikely to be uniform. > >With this caveat in mind, as stated in my answer to the honourable member's question No. 219 of 9 March 1977, 1 am prepared to provide statistics of the numbers, age and sex of persons registered as unemployed in Offices of the CES contained in the respective electorates as requested by the honourable member but, as statistics of occupational categories for which unemployed persons are registered are not normally published by CES Office areas I do not consider that the considerable clerical effort involved in their extraction, would be justified for pan (3) of the honourable member's question. > >The following are the answers, in terms of CES Office areas to pans (1) and (2) of the honourable member's question: > >1 ) (a) Parts of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Chifley as presently constituted, viz: Mt Druitt, Blacktown and Penrith. The respective proportions of the three Employment Office areas involved are 40 per cent of Mt Druitt, 40 per cent of Blacktown and 10 per cent of Penrith. .(b) Parts of five Employment Office areas fall within the boundaries of the Federal Electoral Division of Macarthur as presently constituted, viz: Campbelltown, Warilla, Nowra, Goulburn and Wollongong. The respective proportions of the five Employment Office areas involved are 95 per cent of Campbelltown, 75 per cent of Warilla, 70 per cent of Nowra, 25 per cent of Goulburn and 20 per cent of Wollongong. {: type="a" start="c"} 0. Pans of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Macquarie as presently constituted, viz: Bathurst, Lithgow and Maitland. The respective proportions of the three Employment Office areas involved are 75 per cent of Bathurst, 65 per cent of Lithgow and 5 per cent of Maitland. 1. Parts of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Mitchell as presently constituted, viz: Parramatta, Windsor and Blacktown. The respective proportions of the three Employment Office areas involved are 90 per cent of Parramatta, 75 per cent of Windsor and 40 per cent of Blacktown. {: type="a" start="e"} 0. Parts of four Employment Office areas fall within the boundaries of the Federal Electoral Division of Parramatta as presently constituted, viz: Ryde, Granville, Parramatta and Hornsby. The respective proportions of the four Employment Office areas involved are 15 per cent of Ryde, 10 per cent of Granville, 5 per cent of Parramatta and 2 per cent of Hornsby. (0 Parts of six Employment Office areas fall within the boundaries of the Federal Electoral Division of Prospect as presently constituted, viz: Fairfield, Mt Druitt, Liverpool, Blacktown, Penrith and Parramatta. The respective proportions of the six Employment Office areas involved are 75 per cent of Fairfield, 50 per cent of Mt Druitt, 50 per cent of Liverpool, 1 5 per cent of Blacktown, 1 5 per cent of Penrith and 5 per cent of Parramatta. {: type="a" start="g"} 0. Pans of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Werriwa, as presently constituted, viz: Liverpool, Fairfield and Campbelltown. The respective proportions of the three Employment Office areas involved are 50 per cent of Liverpool, 25 per cent of Fairfield and 2 per cent of Campbelltown. {: type="1" start="3"} 0. See electorate of Prospect above. 1. See electorate of Macarthur above. 2. The percentage of persons who were (a) male and (b) female (i) under 2 1 years of age and (ii) 2 1 years of age and over for each of the Employment Office areas comprising the relevant Electoral Divisions at end-February 1976 and endFebruary 1977 were as follows: {:#subdebate-87-5} #### Grants to Private Schools since closed (Question No. 230) {: #subdebate-87-5-s0 .speaker-6U4} ##### Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP am asked the Minister representing the Minister for Education, upon notice, on 8 March 1977: {: type="1" start="1"} 0. In what years, under what programs and to what amount had the Australian Government made grants for buildings and equipment to the schools which in his answer to the honourable member for Murray on 9 December 1976 *(Hansard,* page 3698), he listed as having closed in 1974, 1975 and 1976. 1. In what years, under what programs and to what amount had the Government made grants for buildings since vacated in the case of schools which ne listed in his answer as having amalgamated with other schools. 2. What steps have been taken to ensure that public investment in education is not placed in jeopardy or set at nought by inadequate or irresponsible school councils *(Hansard,* 30 November 1976, page 2944). {: #subdebate-87-5-s1 .speaker-EE6} ##### Mr Viner:
Minister for Aboriginal Affairs · STIRLING, WESTERN AUSTRALIA · LP -- The Minister for Education has provided the following answer to the honourable member's question: (D- {: type="1" start="3"} 0. The steps taken to ensure the proper use of Commonwealth moneys by grantee schools include: the requirement that the school is approved under the relevant State legislation the requirement that the school is operated on the basis of being a non-profit organisation in the case of capital grants that the school agrees to conditions that may be imposed under the provisions of the enabling legislation. For instance under the provisions of the States Grants Schools and Schools Assistance Acts, capital grants are made on the basis that the school agrees to a number of conditions, including the condition that 'facilities provided by a grant must not be sold or otherwise disposed of without prior consultation with the Commonwealth Government. In the case of such an event, the school authority should anticipate that reimbursement may be required to the Commonwealth Government of an amount not exceeding the amount of the grant '. {:#subdebate-87-6} #### Defence Department: Transport Charges (Question No. 267) {: #subdebate-87-6-s0 .speaker-5J4} ##### Mr Scholes: asked the Minister for Defence, upon notice, on 9 March 1 977: >What charges have been made against his Department for the provision of transport outside Australia for (a) the > >Governor-General (b) the Prime Minister, (c) the Minister for Foreign Affairs and (d) other Ministers. **Mr KillenThe** answer to the honourable member's question is as follows: >The only mode of Defence Department transport utilized to provide transport overseas to the Governor-General, Prime Minister, Minister for Foreign Affairs, and other Ministers consists of the special aircraft of RAAF No. 34 Squadron. > >The costs attributable to operating these aircraft and other associated costs, although initially a charge to Defence Appropriations are ultimately recovered from the Prime Minister s Department and constitute a charge to that Department. > >The amounts recovered by the Department of Defence from the Department of the Prime Minister and Cabinet for overseas travel by VIP aircraft of RAAF No. 34 Squadron, and the total flying hours of such travel, are as follows: {:#subdebate-87-7} #### Public Service: Class of Air Travel (Question No. 317) {: #subdebate-87-7-s0 .speaker-2E4} ##### Mr Lloyd:
MURRAY, VICTORIA asked the Minister Assisting the Prime Minister in Public Service Matters, upon notice, on 10 March 1977: {: type="1" start="1"} 0. How many Commonwealth public servants in each level of each division in each department were employed on (a) 1 January 1976 and (b) 1 January 1977. 1. How many of these in each category travelled overseas in 1976 at the expense of the Commonwealth, and what was the cost of air travel and accommodation. 2. How many are now entitled to first class overseas travel, and how many fewer is this figure than prior to the recent Public Service Board decision on overseas air travel. {: #subdebate-87-7-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) Information in the form sought by the honourable member is not centrally recorded; however, information in relation to Australian Public Service employment which is readily available is shown in the following tables. {: type="1" start="2"} 0. I am advised that the information requested by the honourable member is not centrally recorded. 1. Generally, overseas air travel for Australian Public Service staff and families at Government expense is now at economy class except for officers with a salary equal to Level 1, Second Division or above, travelling for business purposes, who may travel first class. Prior to the Public Service Board decision referred to, all Commonwealth Public Servants who travelled overseas were entitled to first-class air travel. {:#subdebate-87-8} #### Average Wage Rates (Question No. 380) {: #subdebate-87-8-s0 .speaker-ZJ4} ##### Mr Willis: asked the Minister for Employment and Industrial Relations, upon notice, on 16 March 1977: {: type="1" start="1"} 0. What were the average wage rates, on a comparable basis, in Japan, the United States of America, Britain, Germany and Australia in each year since 1 965-66. 1. What were the indices of average real wage rates for each of these countries in each year since 1 965-66. 2. What are the indices when they are re-calculated in Australian dollar equivalent terms, taking account of exchange rate changes. 3. What were the average weekly wage rates in each of these countries, in Australian dollars, at the present rate of exchange in the most recent period for which comparable data is available. {: #subdebate-87-8-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) There is no suitable source available from which to obtain comparable information on average wage rates, in money units, for the countries and time period specified. 1. The publication "Main Economic Indicators", produced by the Organisation for Economic Co-operation and Development, contains indices of average earnings which enable a limited comparison to be made of the rate of increase of earnings in each country with the exception of Australia. The available indices for the countries other than Australia measure average earnings of adult and junior males and females and part-time workers whereas the two series for Australia contained in the publication are for average minimum hourly wage rates in manufacturing for males and females separately. The male rates only have been included in Table 1. For each country the index of real earnings was calculated by dividing the index of earnings by each country's consumer price index (all items). The statistical difficulties of making comparisons between earnings in various places, due mainly to differences in coverage and compilation; require that any interpretation of the figures in the table be made with caution. 2. As original data expressed in domestic currencies is not readily available, it has not been possible to perform the necessary calculations. 3. Table 2 provides a comparison of earnings for Japan, United States of America, United Kingdom, Germany and Australia for 1975. The earnings are expressed in the relevant domestic currencies and are the latest available. Table 3 provides a comparison of those rates converted into Australian dollars. The comments relating to each of these statistics reveal that comparisons are extremely difficult. {:#subdebate-87-9} #### Community Youth Support Projects (Question No. 407) {: #subdebate-87-9-s0 .speaker-00ATA} ##### Mr Hodges:
PETRIE, QUEENSLAND asked the Minister for Employment and Industrial Relations, upon notice, on 17 March 1977: {: type="1" start="1"} 0. 1 ) In which Federal electoral divisions, giving the names of Commonwealth Employment Offices, have Community Youth Support projects been (a) initiated and (b) approved. 1. ) What is the total cost of approved projects to date. {: #subdebate-87-9-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: (l)-(a) The Federal electorates in which Community Youth Support Scheme projects have been initiated as at 30 April 1 977, together with the names of the relevant Offices of the Commonwealth Employment Service are listed below: {: type="a" start="b"} 0. The Federal electorates in which Community Youth Support Scheme projects have been approved as at 30 April 1977 together with the names of the relevant Offices of the Commonwealth Employment Service are listed below: {: type="1" start="2"} 0. As at 30 April 1977 the total cost of projects approved under the Scheme was approximately $ 1.5m. {:#subdebate-87-10} #### Review of Secret Commissions Act (Question No. 408) {: #subdebate-87-10-s0 .speaker-CV4} ##### Mr Jacobi: asked the Minister representing the Minister for Industry and Commerce, upon notice, on 17 March 1977: {: type="1" start="1"} 0. 1 ) Has the Department of Industry and Commerce been conducting a review of the Secret Commissions Act, which it administers, following the Lockheed scandal. 1. Have any breaches of this Act been discovered in the last 10 years; if >o, what action was taken in respect of each. 2. Has the Attorney-General's Department been asked to conduct a review of the Secret Commissions Act, and have any consultations taken place with that Department as part of this review. 3. Is the work of the Economic and Social Council of the United Nations being considered as part of this review. {: #subdebate-87-10-s1 .speaker-ZD4} ##### Mr Howard:
LP -The Minister for Industry and Commerce has provided the following answer to the honourable member's question: >The Attorney-General has advised me that this question was prepared by an officer of his Department. In these circumstances I do not propose to answer it. {:#subdebate-87-11} #### Preterm Clinic (Question No. 417) {: #subdebate-87-11-s0 .speaker-2E4} ##### Mr Lloyd: asked the Minister for Health, upon notice, on 17 March 1977: {: type="1" start="1"} 0. 1 ) Is a preterm clinic to be established in Canberra. 1. If so, (a) what is its purpose, (b) who will control it and (c) what financial assistance has the Government agreed to provide for its establishment, running costs and patients using its services. {: #subdebate-87-11-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) and (2)1 assume that my colleague is referring to the specific organisation known as the Preterm Foundation which I understand provides the following services in Sydney: pregnancy testing; pregnancy counselling and referral; legal termination of pregnancy; contraceptive counselling and medical assistance; research into abortion and contraception; education program. The Foundation has not indicated to the Capital Territory Health Commission whether it intends to establish a clinic in Canberra or not. However, an association known as Preterm Canberra has applied for incorporation in the A.C.T. under the Association s Incorporation Ordinance 1953-1966. A separate organisation known as Population Services International (Australia) Limited (PSI) has advised that it intends to open a private medical clinic in Canberra and that its services will include: counselling services; male/female sterilisation; detection and treatment of VD, minor gynaecological disorders; pregnancy testing. The termination of pregnancies will not be carried out at other than a public hospital during the period in which the Termination of Pregnancy (Temporary Provisions) Ordinance is in force. Neither organisation has sought nor received any financial assistance from the Government for establishment or running costs in the Australian Capital Territory. Scheduled medical services provided through such clinics attract rebate either from Medibank or from private insurance funds. Consultations with Industrial Registrar (Question No. 436) {: #subdebate-87-11-s2 .speaker-PD4} ##### Mr Brown:
DIAMOND VALLEY, VICTORIA asked the Minister for Employment and Industrial Relations, upon notice, on 22 March 1977: {: type="1" start="1"} 0. Which organisations have consulted with the Industrial Registrar pursuant to sub-section 133 (4D) of the Conciliation and Arbitration Act. 1. On what date or dates did each of these organisations consult with the Industrial Registrar. 2. Has the Industrial Registrar made any determinations of alterations to the rules of any organisations pursuant to sub-section 133 (4D) of the Conciliation and Arbitration Act 3. If so, on what date or dates did the Industrial Registrar make the determinations and what was the substance of each. {: #subdebate-87-11-s3 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: ( 1-4) Paragraph 133 ( 1) (db) of the Conciliation and Arbitration Act came into operation on 8 July 1976. Subsection 133 (4C) allows an organisation a period of 12 months after that date within which to bring its rules into conformity with the requirements of that paragraph. The power conferred upon the Industrial Registrar by subsection 133 (4D) is not available to him until the expiration of the period allowed by sub-section 133 (4C). The rules of a number of organisations already prescribe terms of office which do not exceed the period prescribed in paragraph 133 (1) (db). I am advised that the Industrial Registrar has convened meetings of representatives of registered organisations in Melbourne and Sydney to discuss, among other things, the subject of paragraph 133 (1) (db), and that appropriate alterations to the rules of some organisations have already been certified by the Industrial Registrar. {:#subdebate-87-12} #### Applications to Industrial Registrar (Question No. 439) {: #subdebate-87-12-s0 .speaker-PD4} ##### Mr Brown: asked the Minister for Employment and Industrial Relations, upon notice, on 22 March 1977: {: type="1" start="1"} 0. How many applications to the Industrial Registrar have been made pursuant to sub-section 133aa(3) of the Conciliation and Arbitration Act.. 1. ) On what date was each application made. 2. 3) By what organisation was each application made. 3. What decision was made by the Industrial Registrar on each application. 4. Have any organisations conducted an election or ballot for any office since the date upon which the Industrial Registrar made his decision with respect to each application; if so, what organisations, and for what offices. {: #subdebate-87-12-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: (1), (2), (3) and (4) The details of applications made to the Industrial Registrar pursuant to sub-section 133aa (3) of the Conciliation and Arbitration Act as at 6 June 1 977, are as follows: {: type="1" start="5"} 0. This information is not available. {:#subdebate-87-13} #### Appendicectomies in Canberra (Question No. 447) {: #subdebate-87-13-s0 .speaker-SH4} ##### Dr Klugman: asked the Minister for Health, upon notice, on 22 March 1977: {: type="1" start="1"} 0. 1 ) Has his attention been drawn to claims by a Canberra surgeon that only 47 per cent of appendicectomies done in Canberra were essential and that 33 per cent could not be justified at all. 1. If so, what steps has he taken to check on the accuracy of this statement {: #subdebate-87-13-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. and (2) I am not aware of any properly conducted research study which can support such a claim. The honourable member will be aware that claims of this sort have been made in various parts of the world on the basis of the review of clinical records by clinicians and researchers properly qualified in the analysis of clinical data. The Division of Surgery has been conducting a survey on the utilisation of the surgical facilities in conjunction with the hospital administration as a step towards the more efficient utilisation of surgical facilities and the organisation of peer review. That is the appropriate body to review surgical rates generally and I can assure the honourable member that any reliable information on over utilisation would be referred to the Division for analysis. Contract to Inter-city Security (Question No. 474) {: #subdebate-87-13-s2 .speaker-JM9} ##### Mr Armitage:
CHIFLEY, NEW SOUTH WALES asked the Minister representing the Minister for Administrative Services, upon notice, on 23 March 1977: {: type="1" start="1"} 0. 1 ) Was a contract let to Inter-city Security in respect of the New South Wales Repository of the Australian Archives at Villawood instead of arranging for Commonwealth Police to guard the Repository; if so, why. 1. ) What are the conditions of the contract. 2. Who are the directors of the company. {: #subdebate-87-13-s3 .speaker-KVM} ##### Mr Street:
LP -- The Minister for Administrative Services has provided the following answer to the honourable member's question: {: type="1" start="1"} 0. 1 ) Yes. The contract represents a continuance of arrangements operating in respect of the Villawood Repository since March 1973. 1. Continuous watching during the silent hours including gate security and area patrols. Area patrols on weekends and holidays. 2. 3 ) According to the records held by the New South Wales Companies Office, the Directors of the company are Anthony William George and Nicola Ann George. {:#subdebate-87-14} #### Capricornia Electorate: Employment Registrations (Question No. 477) {: #subdebate-87-14-s0 .speaker-JW8} ##### Mr Carige:
CAPRICORNIA, QUEENSLAND asked the Minister for Employment and Industrial Relations, upon notice, on 23 March 1977: {: type="1" start="1"} 0. 1 ) What was the highest number of persons registered for employment with the Commonwealth Employment Service in the Electoral Division of Capricornia in 1972, 1974, 1975 and 1976. 1. How many persons were registered for employment in the Division in (a) January and (b) February 1977. 2. Of those referred to in parts (1) and (2), how many were (a) single and (b) married women. {: #subdebate-87-14-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: >Statistics of unemployed persons registered with the Commonwealth Employment Service (CES) are normally compiled according to individual Employment Office areas. It is not usual for the boundaries of these to coincide with the boundaries of parliamentary electorates and in the majority of cases parts of several CES Office areas would be contained in any one electorate. Conversely, however, some Employment Offices either contain a single electorate or parts of more than one electorate within their boundaries. > >It is possible to state roughly the proportion of each CES Office area contained in a particular electorate and to provide statistics relating to the total number of persons registered as unemployed in each one of those Offices. Any attempt to apply the relative proportions to these total figures, however, in an effort to obtain an estimate of the number and characteristics of the unemployed registrants in that electorate, would be misleading as the distribution of population and unemployment within each CES Office area is unlikely to be uniform. > >I ) and (3) Bearing in mind the above caveat, it should also be noted that, as the highest number of persons registered as unemployed will not necessarily occur in the same month for each of the CES Offices included in a parliamentary electorate, it is not always feasible to deduce the particular end-month reporting date when unemployment would have been highest in the electorate in any given year. > >Parts of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Capricornia as presently constituted, viz. Rockhampton, Gladstone and Bundaberg. The respective proportions of the three Employment Office areas involved are 10 per cent of Rockhampton, 60 per cent of Gladstone and 20 per cent of Bundaberg. > >Subject to the relevant qualifications the highest numbers of persons registered as unemployed in each of the above Offices showing (a) single and (b) married women and (c) total persons and the end-month in which this highest registration occurred for each of the years requested in part ( 1 ) of the honourable member's question were as follows: > >and (3) Subject also to the relevant qualifications, the numbers of persons registered as unemployed in each of the above Offices showing (a) single and (b) married women and (c) total persons at end-January and (d) end-February 1977 were as follows: {:#subdebate-87-15} #### Abortions (Question No. 514) {: #subdebate-87-15-s0 .speaker-KRR} ##### Mr McLean:
PERTH, WESTERN AUSTRALIA asked the Minister for Health, upon notice, on 23 March 1977: {: type="1" start="1"} 0. 1 ) What is the estimated number of abortions carried out in Australia each year. 1. How many were carried out in 1976. 2. Of these, what approximate percentage were performed for medical reasons. 3. What justification is now required before a doctor can perform an abortion. 4. What was the cost to Medibank and Private Health Funds in the financing of abortions in 1 976. {: #subdebate-87-15-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -- The answer to the honourable member's question is as follows: (1), (2) and (5) There are no reliable statistics of the number of abortions carried out in Australia. Information is available for medical services for which medical benefits have been paid under various individual items in the Medical Benefits Schedule. The information relates only to services performed by medical practitioners on a fee-for-service basis, and which were the subject of claims for medical benefits. For instance the information would not include any of the large numbers of medical services provided by recognised hospitals to 'hospital patients' in standard wards (i.e. the former 'public ward patients'). Under the Commonwealth/State Hospital Agreements, these medical services are provided to these patients by the recognised hospitals. Medical benefits are not payable in respect of such services, and the cost of their provision forms part of the costs shared under the Hospital Agreements. The Medical Benefits Schedule includes medical services in the nature of gynaecological procedures which may result in the termination of pregnancy. Schedule item 6469 'Evacuation of the contents of the gravid uterus by curettage or suction curettage . . . ' is the item under which most abortions would be itemised. Another gynaecological procedure which may result in the termination of a pregnancy is covered by Schedule items 6460/6464- 'Uterus, curettage of, with or without dilation, including curettage for incomplete miscarriage'. Information is not available on the number of such cases in which a pregnancy was terminated as the items cover a number of gynaecological procedures apart from termination of a pregnancy. On the basis of information available it is estimated that the number of services for which medical benefits were paid by Medibank and the private health funds in 1976 under item 6469 was 39,400 and the medical benefits paid amounted to $2. 5m. {: type="1" start="3"} 0. and (4) A doctor providing any medical procedure should have regard to the laws of the State or Territory in which he practises, professional ethics and the patient's interest and welfare. The information available does not distinguish which of the services mentioned above (i.e. 39,400) were performed for medical reasons, or other reasons. ' {:#subdebate-87-16} #### Unemployment Patterns (Question No. 535) {: #subdebate-87-16-s0 .speaker-SD4} ##### Mr Cadman:
MITCHELL, NEW SOUTH WALES asked the Minister for Employment and Industrial Relations, upon notice, on 29 March 1977: {: type="1" start="1"} 0. 1 ) What are the proportional levels of unemployment in each of the States as a percentage of the workforce. 1. What are the reasons for the level of unemployment in New South Wales and the difference between New South Wales and other States. 2. What age groups and skills have been particularly affected. 3. Has this pattern varied over the past S years. {: #subdebate-87-16-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) At end-April 1977 the number of persons registered as unemployed with the Commonwealth Employment Service (CES) in New South Wales, including the Australian Capital Territory, was 139,911 or 6.1 per cent of the estimated labour force. This compared with rates of 4.3 per cent in Victoria, 5.7 per cent in Queensland, 4.4 per cent in South Australia, 4.3 per cent in Western Australia, 4.6 per cent in Tasmania and 8.8 per cent in the Northern Territory. The rate for Australia as a whole was 5.2 per cent 1. and (3) The following tables show the proportional distribution of persons registered as unemployed in New South Wales (including the A.C.T.) compared with the rest of Australia by sex, age group and principal occupational category as at end-February 1977. (Extraction of these figures commenced before later data became available, however the proportional distribution of registrants does not change markedly over a period of two months and, as the extraction was most time-consuming, I did not consider it necessary to have the exercise repeated when the end-April figures became available.) In drawing conclusions from the tables it should be borne in mind that: the November 1973 report of the Advisory Committee on CES statistics warned against comparisons of general and sectoral levels of registered unemployed (primarily because of the voluntary nature of registration for employment with the CES); and the unemployment figures are made on a proportional basis and it is probable that any individual State considered in isolation would show significant divergencies from the average for the rest of Australia in the way in which the N.S.W. and A.C.T. figures do. {: type="1" start="4"} 0. Tables 3 and 4 below provide comparable data on persons registered as unemployed for New South Wales (including the A.C.T.) and for the rest of Australia as at end February 1972. {:#subdebate-87-17} #### Deficit Financed Nursing Homes (Question No. 545) {: #subdebate-87-17-s0 .speaker-2E4} ##### Mr Lloyd: asked the Minister for Health, upon notice, on 30 March 1977: {: type="1" start="1"} 0. Has he received complaints that, because deficit financed nursing homes are financially protected *from the* effect of increased wages, they have agreed to over-generous wage and salary increases for their staff. 1. If so, what is being done to protect taxpayers' funds from unnecessarily subsidising these homes. {: #subdebate-87-17-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) A complaint was received by my Department concerning the terms of an industrial agreement reached between the Voluntary Care Association of New South Wales and the Australian Capital Territory and the Health and Research Employees' Association of Australia. 1. My Department is making detailed enquiries regarding the matters raised in the complaint. Until that information is available I am not able to comment in detail on the matters raised. However, I would be most concerned if it is found that deficit-financed nursing homes, because of the public assistance provided to them, have conceded industrial conditions superior to those applying in the industry as a whole. {:#subdebate-87-18} #### National Ethnic Broadcasting Advisory Council (Question No. 565) {: #subdebate-87-18-s0 .speaker-6U4} ##### Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP am asked the Minister for Immigration and Ethnic Affairs, upon notice, on 30 March 1977: {: type="1" start="1"} 0. What funds are available for the operations of the National Ethnic Broadcasting Advisory Council whose appointment he announced on1 February 1 977. 1. On what dates and at what places has the Council met. 2. Who paid the fares for the members of the Council who attended the meetings. 3. Are members being paid, or will they be paid, sitting fees; if so, who is to pay these fees. {: #subdebate-87-18-s1 .speaker-0I4} ##### Mr MacKellar:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. I understand that no funds have been provided specifically to cover the costs of the National Ethnic Broadcasting Advisory Council in the current financial year. However, the Australian Broadcasting Commission agreed to assume responsibility for the servicing of the Council and I understand that the meeting costs are being met from its appropriation for the financial year. 1. Meetings have been held on the following dates at the following places: 25 February 1977-Melbourne. 18 March 1977-Sydney. 25 March 1977-Melbourne. 18 April 1977-Sydney. 23 May 1977-Melbourne. 2. I understand that the Australian Broadcasting Commission has paid fares for all members except the departmental representatives on the Council, whose fares were paid by their respective Departments. 3. Sitting fees have not been paid. The question of expenses is currently receiving further consideration. Supporting Father's Benefit: Correction of Information (Question No. 582) {: #subdebate-87-18-s2 .speaker-GH4} ##### Mr Hunt:
NCP/NP -On 31 March 1977 **Mr E.** G. Whitlam asked a question on notice concerning benefits for single supporting fathers. In providing a reply to the honourable member, I stated that a costing based on preliminary data from a survey of families conducted by the Australian Bureau of Statistics in May 1975 indicated that the full year cost of such a benefit would be to the order of $8. 10m. This figure should have been $8- 10m. Public Service Positions in the Australian Capital Territory (Question No. 599) {: #subdebate-87-18-s3 .speaker-5J4} ##### Mr Scholes: asked the Minister Assisting the Prime Minister in Public Service Matters, upon notice, on 19 April 1977: {: type="1" start="1"} 0. 1 ) Will he ascertain how many State public service jobs are available in the A.C.T. 1. How many public service positions have been transferred to, or located in, Canberra as a result of Government action in the last 20 years. {: #subdebate-87-18-s4 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) The Commonwealth Government does not have the information sought. 1. As at 30 June 1976, 40032 Commonwealth Public Service Act (permanent and temporary) positions were located in the ACT. Records, enabling comparable figures for earlier dates, were not maintained prior to 30 June 1959 when there were 6429 Public Service Act positions (permanent and temporary) in the A.C.T. Figures relating to full-time staff (permanent, temporary and exempt) employed in the A.C.T. under the Public Service Act are available, however, and these are: 30 June 1976......... 34 294 30 June 1956......... 7 330 4715 Public Service Act positions have been transferred into the A.C.T. since 1957, as follows: A decision announced by the Prime Minister on 19 December 1976, will result in the transfer of 274 Public Service Act positions from Melbourne and Sydney to Canberra during the period to early 1978. Law Reform in the Australian Capital Territory (Question No. 612) {: #subdebate-87-18-s5 .speaker-CV4} ##### Mr Jacobi: asked the Attorney-General, upon notice, on 19 April 1977: {: type="1" start="1"} 0. 1 ) Has his attention been drawn to the paper delivered by His Honour **Mr Justice** Blackburn at the Second Symposium on Law and Justice in the Australian Capital Territory regarding law reform in the Territory. 1. If so, what progress has been made on the revision and reform of the criminal law in force in the A.C.T. 2. 3) What action is being taken to clarify the law in force in the A.C.T. relating to the powers of arrest in the light of the problems raised in *Stefanchick v. Charge.* 3. Is it intended to take any action, or has any action been taken, to implement the recommendations made in the reports prepared by the Law Reform Commission of the A.C.T. on (a) Imperial Acts in force in the Territory, presented on 25 August 1 972 and 24 January 1 973, respectively, (b) Law relating to Arbitration in the Territory, presented on 1 1 August 1974 and (c) Law relating to Landlord and Tenants in the Territory, presented on 20 December 1 972. 4. Will he undertake to have the contents of His Honour's paper examined, and ensure that appropriate action is taken to give effect to the recommendations in that paper. {: #subdebate-87-18-s6 .speaker-YF6} ##### Mr Ellicott:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) and ( 2 ) Yes. In my address to that Symposium, a copy of which has been supplied to the honourable member, I outlined the steps that are currently being taken to effect necessary reforms to the criminal law applying in the Australian Capital Territory. 1. The powers of arrest of the Commonwealth Police Force are currently under review in light of the Criminal Investigations Bill. I expect that Bill to provide a model for the Police Forces of the Territories. 2. (a) As I informed the honourable member in my reply to Question No. 1671 *(Hansard,* 9 December 1976) an Ordinance is being prepared to implement the report. Drafting of the Ordinance has commenced, but a very great deal of work is involved. The preparation of the draft Ordinance will be completed as soon as practicable, having regard to other priorities. {: type="a" start="b"} 0. The Standing Committee of Attorneys-General has requested that a model Bill for uniform legislation on this topic be prepared. Work on that Bill is well advanced and should be completed in the near future. 1. This is a matter for the Minister for the Capital Territorysee my answer to Question No. 1 67 1 . 3. 5 ) The recommendations are being examined with a view to action where appropriate. {:#subdebate-87-19} #### Unemployment Registrations: Western Sydney (Question No. 627) {: #subdebate-87-19-s0 .speaker-6U4} ##### Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP am asked the Minister for Employment and Industrial Relations, upon notice, on 18 April 1977: {: type="1" start="1"} 0. 1 ) How many persons were registered as unemployed at the end of March 1976 and at the end of March 1977 in the Electoral Divisions of (a) Chifley, (b) Macarthur, (c) Macquarie, (d) Mitchell, (e) Parramatta, (f) Prospect and (g) Werriwa. 1. 2 ) What percentage of the persons was ( a ) males and ( b ) females (i) under 2 1 years of age and (ii) 2 1 years of age and over. 2. What were the principal work categories of the persons registered as unemployed. {: #subdebate-87-19-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: >Statistics of unemployed persons registered with the Commonwealth Employment Service (CES) are normally compiled according to individual Employment Office areas. It is not usual for the boundaries of these to coincide with the boundaries of Parliamentary electorates and in the majority of cases parts of several Employment Office areas would be contained in any one electorate. Conversely, however, some Employment Offices either contain a single electorate or parts of more than one electorate within their boundaries. > >It is possible to state roughly the proportion of each CES Office area contained in a particular electorate and to provide statistics relating to the total number of persons registered as unemployed in each of those Offices. Any attempt to apply the relative proportions to these total figures, however, in an effort to obtain an estimate of the number and characteristics of the unemployed registrants in that electorate, would be misleading as the distribution of population and unemployment within each CES Office area is unlikely to be uniform. > >With this caveat in mind, as stated in my answer to the honourable member's question No. 219 of 9 March 1977, 1 am prepared to provide statistics of the numbers, age and sex of persons registered as unemployed in Offices of the CES contained in the respective electorates as requested by the honourable member but, as statistics of occupational categories for which unemployed persons are registered are not normally published by CES Office areas I do not consider that the considerable clerical effort involved in their extraction, would be j justified for part ( 3 ) of the honourable member 's question. > >The following are the answers, in terms of CES Office areas to parts (I) and (2) of the honourable member's question: > >1 ) (a) Parts of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Chifley as presently constituted, viz: Mt Druitt, Blacktown and Penrith. The respective proportions of the three Employment Office areas involved are 40 per cent of Mt Druitt, 40 per cent of Blacktown and 10 per cent of Penrith. {: type="a" start="b"} 0. Parts of five Employment Office areas fall within the boundaries of the Federal Electoral Division of Macarthur as presently constituted, viz: Campbelltown, Warilla, Nowra, Goulburn and Wollongong. The respective proportions of the five Employment Office areas involved are 95 per cent of Campbelltown, 75 per cent of Warilla, 70 per cent of Nowra, 25 per cent of Goulburn and 20 per cent of Wollongong. {: type="a" start="c"} 0. Parts of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Macquarie as presently constituted, viz: Bathurst, Lithgow and Maitland. The respective proportions of the three Employment Office areas involved are 75 per cent of Bathurst, 65 per cent of Lithgow and 5 per cent of Maitland. {: type="a" start="d"} 0. Parts of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Mitchell as presently constituted, viz: Parramatta, Windsor and Blacktown. The respective proportions of the three Employment Office areas involved are 90 per cent of Parramatta, 75 per cent of Windsor and 40 per cent of Blacktown. {: type="a" start="e"} 0. Parts of four Employment Office areas fall within the boundaries of the Federal Electoral Division of Parramatta as presently constituted, viz: Ryde, Granville, Parramatta and Hornsby. The respective proportions of the four Employment Office areas involved are 15 per cent of Ryde, 10 per cent of Granville, 5 per cent of Parramatta and 2 per cent of Hornsby. {: type="a" start="f"} 0. Parts of six Employment Office areas fall within the boundaries of the Federal Electoral Division of Prospect as presently constituted, viz: Fairfield, Mt Druitt, Liverpool, Blacktown, Penrith and Parramatta. The respective proportions of the six Employment Office areas involved are 75 per cent of Fairfield, 50 per cent of Mt Druitt, 50 per cent of Liverpool, 1 5 per cent of Blacktown, 1 5 per cent of Penrith and 5 per cent of Parramatta. {: type="a" start="g"} 0. Parts of three Employment Office areas fall within the boundaries of the Federal Electoral Division of Werriwa, as presently constituted, viz: Liverpool, Fairfield and Campbelltown. The respective proportions of the three Employment Office areas involved are 50 per cent of Liverpool, 25 per cent of Fairfield and 2 per cent of Campbelltown. {: type="1" start="2"} 0. The percentage of persons who were (a) male and (b) female (i) under 2 1 years of age and (ii) 2 1 years of age and over for each of the Employment Office areas comprising the relevant Electoral Divisions at end-March 1 976 and end-March 1977 were as follows: {:#subdebate-87-20} #### Women's Refuges: Queensland (Question No. 630) {: #subdebate-87-20-s0 .speaker-6U4} ##### Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP am asked the Minister for Health, upon notice, on 19 April 1977: {: type="1" start="1"} 0. 1 ) Did he state on 20 May 1 976 that State grants of $8 1 m in 1976-77 for community health services and facilities should enable the projects which had been commenced to be maintained at a viable level of activity. 1. Did he state on 21 October 1976 *(Hansard,* page 2173) that the Commonwealth's intention was that funds be available for continuation of the 19 previously approved women 's refuges throughout 1 976-77. 2. When did he become aware that the Queensland government had decided in July 1976 not to pass on any Federal Funds for the two women's refuges which had been approved in Queensland, namely in Brisbane and Townsville. 3. When did he become aware that these two refuges were short of funds. 4. When did he and the Minister for Social Security ask the Prime Minister whether they could examine alternative sources of funding. 5. When did the Prime Minister ask them to do so. 6. Have the other States passed on Federal funds for the other 1 7 women's refuges which had been approved. 7. Are the other 17 women's refuges being maintained at a viable level. {: #subdebate-87-20-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. Yes. 1. Yes. 2. In July 1976, the Hospitals and Health Services Commission was advised of the decision by the Queensland Government. This decision came to my attention in August 1976. 3. Since receipt of the advice of the Queensland Government's decision, it has been presumed that these two refuges could be faced with a shortage of funds. 4. 5 ) and ( 6 ) Questions concerning the funding of women 's refuges have been under discussion for some time between the Prime Minister, the Minister for Social Security and myself, also our Departments. I understand that in the meantime the Prime Minister was in touch with the Premier of Queensland. With regard to the two Queensland refuges currently approved for Commonwealth purposes under the Community Health Program, the practicability of alternative methods of funding are currently under consideration. {: type="1" start="7"} 0. Yes. 1. As far as my Department is aware, the other 17 women's refuges are being maintained at a viable level of activity. Excess Water Rates in Canberra (Question No. 646) {: #subdebate-87-20-s2 .speaker-KOB} ##### Mr Haslem: asked the Minister for the Capital Territory, upon notice, on 20 April 1977: {: type="1" start="1"} 0. 1 ) Did he state in answer to question No. 362 *(Hansard,* 31 March 1977, page 883) that the total revenue received from Canberra ratepayers for excess water rates was $291,814.44 during 1976. 1. What are the costs of collecting that amount including accounting, meter reading, transport, meter repairs and maintenance, replacement of meters, depreciation and notional interest charges and any other charges attributable to that revenue. {: #subdebate-87-20-s3 .speaker-GY5} ##### Mr Staley:
Minister for the Capital Territory · CHISHOLM, VICTORIA · LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) There was a substantial clerical error in the information provided, due to the omission of some figures in sorting onto a 1976 calendar basis figures kept on 197S-76 ana 1976-77 financial year basis. The 1976 collection for excess water was approximately $644,000. 1. The reading of water meters gives a total usage only. The excess usage is assessed and billed as a supplement to the basic charge. There are only slight clerical and billing costs which relate directly to the recovery of excess water rates but these are not extractable or measurable. The total costs relating to water meters and meter readings including billing, collecting, accounting, repairs and maintenance, capital amortisation charges, etc, were estimated at $456,000 during 1976. The total collection in respect of the water supply account was about $3.8m for 1976. This explanation excludes the cost of operation, maintenance and amortisation of the total storage and distribution system. {:#subdebate-87-21} #### Medical Benefits Payments for Termination of Pregnancy (Question No. 649) {: #subdebate-87-21-s0 .speaker-2E4} ##### Mr Lloyd: asked the Minister for Health, upon notice, on 20 April 1977: {: type="1" start="1"} 0. 1 ) What sum has been paid to medical practitioners from the medical benefits schedule for the termination of pregnancy in each of the last three years. 1. What are the various benefit payments for termination and associated services. {: #subdebate-87-21-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) While the exact information requested is not available, I have supplied below what relevant information is available. Information is available for medical services for which medical benefits have been paid under various individual items in the Medical Benefits Schedule. The information relates only to services performed by medical practitioners on a fee-for-service basis, and which were the subject of claims for medical benefits. For instance the information would not include any of the large numbers of medical services provided by recognised hospitals to 'hospital patients' in standard wards (i.e. the former 'public ward patients'). Under the Commonwealth/State Hospital Agreements, these medical services are provided to these patients by the recognised hospitals. Medical benefits are not payable in respect of such services, and the cost of their provision forms part of the costs shared under the Hospital Agreements. The Medical Benefits Schedule includes medical services in the nature of gynaecological procedures which may result in the termination of pregnancy. Schedule item 6469- Evacuation of the contents of the gravid uterus by curettage or suction curettage . . '-is the item under which most terminations would be itemised. Another gynaecological procedure which may result in the termination of a pregnancy is covered by Schedule items 6460/6464- 'Uterus, curettage of, with or without dilation, including curettage for incomplete miscarriage'. Information is not available on the number of such cases in which a pregnancy was terminated as the items cover a number of gynaecological procedures apart from termination of a pregnancy. On the basis of information available for item 6469- Evacuation of the contents of the gravid uterus by curettage or suction curettage . '-it is estimated that the amount paid as medical benefits in 1974-75 was $0.9m, and in 1975-76, $2.4m. This procedure was not introduced into the Medical Benefits Schedule until 24 April 1974 and so information on this procedure prior to 1974-75 is not available. The information available does not cover at this stage fees actually charged as distinct from the medical benefits paid. {: type="1" start="2"} 0. The following table shows the fees and benefits effective from 1 January 1977 in respect of the items mentioned above- Item 6469- Evacuation of the contents of the gravid uterus by curettage or suction curettage General Practitioner or Specialist-All States Fee $46.50, Benefit $4 1.50 Item 6460/6464- Curettage of uterus, with or without dilation, including curettage for incomplete miscarriage. General Practitioner-All States Fee $42.00, Benefit $37.00 {:#subdebate-87-22} #### Fire Brigade Arrangements (Question No. 658) {: #subdebate-87-22-s0 .speaker-6U4} ##### Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP am asked the Minister representing the Minister for Administrative Services, upon notice, on 20 April 1 977: {: type="1" start="1"} 0. When did the State Governments agree to the arrangements to make payments instead of telephone concessions to fire brigades in respect of the protection they afford to Federal property *(Hansard,* 22 March 1977, page 415). 1. When, how and with what result have Federal and State Ministers or authorities consulted on the financing and co-ordination of fire brigades since the Insurance Council of Australia submitted its case to the Prime Minister and Premiers on 24 November 1976. 2. How soon does the Fire Board expect to complete its investigation, to which all Premiers had agreed by October 1975, into the introduction of a standardised fire hose coupling *(Hansard,* 9 December 1976, page 3723). {: #subdebate-87-22-s1 .speaker-KVM} ##### Mr Street:
LP -- The Minister for Administrative Services has provided the following answer to the honourable member's question: {: type="1" start="1"} 0. 1 ) The details of correspondence between the Prime Minister and a Premier are normally regarded as confidential and for this reason I do not intend to provide details. 1. The representations of the Insurance Council of Australia have been noted by the Government. However, the financing and co-ordination of fire brigades traditionally and constitutionally have rested with the States. In line with the Government's Federalism Policy, the view has been taken that these matters should continue to be State responsibilities. 2. The Commonwealth Fire Board has completed its investigations into the proposal to standardise fire hose couplings throughout Australia and is finalising its submission to the Government. {:#subdebate-87-23} #### Arbitration Inspectorate: Prosecutions (Question No. 684) {: #subdebate-87-23-s0 .speaker-2V4} ##### Mr Clyde Cameron:
HINDMARSH, SOUTH AUSTRALIA · ALP asked the Minister for Employment and Industrial Relations, upon notice, on 26 April 1977: >What was the number of prosecutions launched by the Arbitration Inspectorate against employers in each month during the period 1 January 1973 to 31 December 1976. {: #subdebate-87-23-s1 .speaker-KVM} ##### Mr Street:
LP -The answer to the honourable member's question is as follows: >The statistics set out in the table below have been compiled on the basis of the number of respondent employers against whom prosecutions under Section 1 1 9 of the Conciliation and Arbitration Act were approved within my Department in the period 1 January 1973 to 31 December 1976. They do not relate to the number of breaches alleged to have been committed by those respondents. > >The prosecutions have been tallied according to the month in which the proceedings were brought to finality or not proceeded with for a variety of reasons, including where l egal advice was received from Deputy Crown Solicitors as to evidentiary deficiencies or where leave was granted by the Courts for the matters in question to be withdrawn. {:#subdebate-87-24} #### Health Insurance Commission: Grants (Question No. 685) {: #subdebate-87-24-s0 .speaker-SH4} ##### Dr Klugman: asked the Minister for Health, upon notice, on 26 April 1977: {: type="1" start="1"} 0. Which organisations are receiving Health Program grant payments from the Health Insurance Commission during 1976-77. 1. ) On what basis are payments made. {: #subdebate-87-24-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) The following is a list of the organisations approved for Health Program Grants in the 1976-77 financial year indicating, where appropriate, the date on which the approval of the Grant was terminated. Grant terminated on 30 September 1976 New South Wales Unilever Australia Pry Ltd Sydney County Council General Motors-Holden (N.S.W.) Farmer and Company Ltd Q.B.E. Insurance Ltd Manufacturers ' Mutual Insurance Ltd Victoria Yallourn Medical/Hospital Society Huttons Ltd L. M. Ericsson Pty Ltd General Motors-Holden Pty Ltd (Port Melbourne) Vulcan Australia Ltd General Motors-Holden Pty Ltd (Dandenong) Myer Melbourne Ltd Tramways Benefits Society Nabisco Pty Ltd Prestige Ltd Australian Carbon Black Pty Ltd A.R.C. Engineering Pty Ltd Containers Ltd International Harvester Queensland Consolidated Fertilizers Ltd W. H. Heck and Sons Pty Ltd General Motors-Holden Pty Ltd United Packages Ltd White Motor Corporation Queensland Alumina Ltd South Australia/Northern Territory General Motors-Holden Pty Ltd Perry Engineering Co. Ltd Simpson Pope Ltd Western Australia Pemberton Medical and Hospital Fund Tasmania Rosebery Hospital and Medical Benefits Society Grant terminated on 31 December 1976 South Australia Institute of Medical and Veterinary Science Approved Organisations Currently Receiving Grants New South Wales Australian College of Ophthalmologists Family Planning Association of N.S. W. Haymarket Foundation Ltd Professional Health Screening Services Pty Ltd Victoria Shepherd Foundation Nominees Pty Ltd Association for the Blind Family Planning Association of Victoria Queensland Family Planning Association of Queensland South Australia /Northern Territory Family Planning Association of S.A. Family Planning Association of N.T. Western Australia Family Planning Association of W.A. Tasmania Tasmanian Department of Health Services Family Planning Association of Tasmania Australian Capital Territory Family Planning Association of A.C.T. {: type="1" start="2"} 0. The health program grants were introduced with effect from 1 July 1975 as part of the Medibank arrangements. Their main purpose was to provide a source of financing, in lieu of the payment of medical benefits, for services provided by medical practitioners employed on a salaried or sessional basis by approved organisations. Health program grants were paid on the basis of reimbursing approved organisations for the cost of providing approved medical clinical services free of charge. With the introduction of the modified Medibank arrangements on 1 October 1976 significant changes were made in the method of financing medical services, with private medical benefits funds and employers assuming a much greater role. As from that date Commonwealth medical benefits have not been payable in respect of services rendered to privately insured persons or for medical expenses incurred by employers. As a result of the above changes the health program grants have not been payable since 1 October 1976 in respect of those organisations shown as having the grant terminated on 30 September 1976. The changed health program grants arrangements adopted from1 October 1976 take into account the basic principle that charges should be raised for scheduled medical services provided to people who are insured for both medical andhospital benefits with registered health benefits organisations. Exceptions to the application of this principle are permitted in special circumstances, e.g. where privacy considerations are paramount. Consequently the levels of the health program grams to approved organisations are now generally determined so that grants meet the cost of medical clinical services provided to persons covered by Standard Medibank. I would remind the honourable member that I recently announced the expansion of the scope of existing Health Program Grant arrangements to provide funds for projects which have potential for demonstrating increased effectiveness, or efficiency of health services, whilst at the same time containing costs. Active encouragement has been given to the development of project proposals pending necessary amendments to the Health Insurance Act 1973. {:#subdebate-87-25} #### Australian Tile Manufacturers Association: Requests (Question No. 687) {: #subdebate-87-25-s0 .speaker-CV4} ##### Mr Jacobi: asked the Minister for Business and Consumer Affairs, upon notice, on 26 April 1977: {: type="1" start="1"} 0. 1) Has he been informed of the findings of the Temporary Assistance Authority inquiry which was set up, in response to a request by the Australian Tile Manufacturers Association, to have increased duty imposed on imported ceramics and mosaics and for Australian importers to be placed on a quota system. 1. When will the findings of the inquiry be submitted to Cabinet. 2. Will he give some indication as to when the results will be made public. 3. What is (a) the current capacity of the Australian tile industry in square metres, (b) the quantity of the Australian production for 1976 and (c) the known market capacity as seen by the Australian Tile Manufacturers Association. 4. Can he say what was the profit of H. and R. Johnson (Aust)PtyLtd for 1976. 5. Has he given consideration to the Australian Tile Manufacturers Association's request, with reference to the recent request to all employer and employee bodies to restrain prices and wages for 3 months, and the subsequent bearing this later request could have on the Temporary Assistance Authority Inquiry's submission to Cabinet. 6. What was the quantity, in square metres, of tiles imported during 1976. 7. Has his attention been drawn to repeated requests to the Australian Tile Manufacturers Association by the Australian tile merchants over a period of 4 to 5 years, as substantiated by the Association's minutes, for a more decorative range in keeping with consumer demands. {: #subdebate-87-25-s1 .speaker-CG4} ##### Mr Fife:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. Yes. 1. The Authority's decision has been considered by Cabinet. 2. The Government's decision was announced on 8 June 1977. 3. (a) In March 1977 the local manufacturers' production capacity for floor and wall tiles was about 4.3m square metres per annum; {: type="a" start="b"} 0. Production statistics not available. However, sales of locally produced tiles in 1975-76 amounted to 3.5m square metres; 1. Not available. 4. No. 5. The voluntary prices/wages pause formally ended on 24 May 1977. 6. 7m square metres of glazed tiles were imported in 1975-76. 7. The range of tiles available on the domestic market was examined by the Authority in its report. {:#subdebate-87-26} #### Unemployment Registrations (Question No. 693) {: #subdebate-87-26-s0 .speaker-K9M} ##### Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP asked the Minister for Employment and Industrial Relations, upon notice, on 26 April 1977: {: type="1" start="1"} 0. How many persons were registered as unemployed at the end of (a) February 1976 and (b) February 1977 in the Electoral Divisions of Hughes, Cook and Cunningham. 1. What percentage of the persons was (a) males and (b) females (i) under 2 1 years of age and (ii) 2 1 years of age and over. {: #subdebate-87-26-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: >Statistics of unemployed persons registered with the Commonwealth Employment Service (CES) are normally compiled according to individual Employment Office areas. It is not usual for the boundaries of these to coincide with the boundaries of parliamentary electorates. In the majority of cases parts of several Employment Office areas would be contained in any one electorate. Conversely, however, some Employment Offices either contain a single electorate or parts of more than one electorate within their boundaries. > >It is possible to state roughly the proportion of each CES Office area contained in a particular electorate and to provide statistics relating to the total number of persons registered as unemployed in each of those Offices. Any attempt to apply the relative proportions to these total figures, however, in an effort to obtain an estimate of the number and characteristics of the unemployed registrants in that electorate, would be misleading as the distribution of population and unemployment within each CES Office area is unlikely to be uniform. > >With this caveat in mind, as stated in my answer to the honourable member for Werriwa 's question No. 219 of 9 March, 1977, I am prepared to provide statistics of the numbers, age and sex of persons registered as unemployed in Offices of the CES contained in the respective electorates as requested by the honourable member. > >The following are the answers, in terms of CES Office areas, to the honourable member's question: > >1 ) Parts of two Employment Office areas fall within the boundaries of the Federal Electoral Division of Hughes as presently constituted, viz: Caringbah and Wollongong. The respective proportions of the two Employment Office areas involved are 50 per cent of Caringbah and 40 per cent of Wollongong. > >The Federal Electoral Division of Cook as presently constituted is entirely contained within the Employment Office area of Caringbah and constitutes approximately 50 per cent of the area of that Employment Office. Details for Caringbah Employment Office are shown above. > >Parts of two Employment Office areas fall within the Federal Electoral Division of Cunningham as presently constituted, viz: Wollongong and Warilla. The respective proportions of the two Employment Office areas involved are 60 per cent of Wollongong, details of which are shown above, and 30 per cent of Warilla, for which details are: > >The percentage of persons who are (a) males and (b) females (i) under 2 1 years of age and (ii) 2 1 years of age and over for each of the Employment Office areas comprising the relevant Electoral Divisions at end-February 1976 and endFebruary 1 977 were as follows: {:#subdebate-87-27} #### Unemployment Registrations (Question No. 694) {: #subdebate-87-27-s0 .speaker-K9M} ##### Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP asked the Minister for Employment and Industrial Relations, upon notice, on 26 April 1977: {: type="1" start="1"} 0. 1 ) How many persons were registered as unemployed at the end of (a) January 1976 and (b) January 1977 in the Electoral Divisions of Hughes, Cook and Cunningham. 1. What percentage of the persons was (a) males and (b) females (i) under 2 1 years of age and (ii) 2 1 years of age and over. 2. What were the principal work categories of the persons registered as unemployed. {: #subdebate-87-27-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: >Statistics of unemployed persons registered with the Commonwealth Employment Service (CES) are normally compiled according to individual Employment Office areas. It is not usual for the boundaries to these to coincide with the boundaries of parliamentary electorates. In the majority of cases parts of several Employment Office areas would be contained in any one electorate. Conversely, however, some Employment Offices either contain a single electorate or parts of more than one electorate within then- boundaries. > >It is possible to state roughly the proportion of each CES Office area contained in a particular electorate and to provide statistics relating to the total number of persons registered as unemployed in each of those Offices. Any attempt to apply the relative proportions to these total figures, however, in an effort to obtain an estimate of the number and characteristics of the unemployed registrants in that electorate, would be misleading as the distribution of population and unemployment within each CES Office area is unlikely to be uniform. > >With this caveat in mind, as stated in my answer to the honourable member for Werriwa "s question No. 219 of 9 March 1977, I am prepared to provide statistics of the numbers, age and sex of persons registered as unemployed in Offices of the CES contained in the respective electorates as requested by the honourable member but, as statistics of occupational categories for which unemployed persons are registered are not normally published by CES Office areas, I do not consider that the considerable clerical effort involved in their extraction would be justified for part (3) of the honourable member's question. > >The following are the answers, in terms of CES Office areas to parts (1) and (2) of the honourable member's question: > >Pans of two Employment Office areas fall within the boundaries of the Federal Electoral Division of Hughes as presently constituted, viz: Caringbah and Wollongong. The respective proportions of the two Employment Office areas involved are 50 per cent of Caringbah and 40 per cent of Wollongong. > >The Federal Electoral Division of Cook as presently constituted is entirely contained within the Employment Office area of Caringbah and constitutes approximately 50 per cent of the area of that Employment Office. Details for Caringbah Employment Office are shown above. > >Pans of two Employment Office areas fall within the Federal Electoral Division of Cunningham as presently constituted, viz: Wollongong and Warilla. The respective proportions of the two Employment Office areas involved are 60 per cent of Wollongong, details of which are shown above, and 30 per cent of Warilla, for which details are: > >The percentage of persons who were (a) males and (b) females (i) under 2 1 years of age and (ii) 2 1 years of age and over for each of the Employment Office areas comprising the relevant Electoral Divisions at end-January 1976 and end-January 1 977 were as follows: {:#subdebate-87-28} #### Unemployment Registrations (Question No. 695) {: #subdebate-87-28-s0 .speaker-K9M} ##### Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP asked the Minister for Employment and Industrial Relations, upon notice, on 26 April 1977: {: type="1" start="1"} 0. 1 ) How many persons were registered as unemployed at (a) 31 December 1975 and (b) 31 December 1976 in the Electoral Divisions of Hughes, Cook and Cunningham. 1. ) What percentage of the persons was (a) males and (b) females (i) under 2 1 years of age and (ii) 2 1 years of age and over. 2. What were the principal work categories of the persons registered as unemployed. {: #subdebate-87-28-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: >Statistics of unemployed persons registered with the Commonwealth Employment Service (CES) are normally compiled according to individual Employment Office areas. It is not usual for the boundaries of these to coincide with the boundaries of parliamentary electorates. In the majority of cases parts of several Employment Office areas would be contained in any one electorate. Conversely, however, some Employment Offices either contain a single electorate or parts of more than one electorate within their boundaries. > >It is possible to state roughly the proportion of each CES Office area contained in a particular electorate and to provide statistics relating to the total number of persons registered as unemployed in each of those Offices. Any attempt to apply the relative proportions to these total figures, however, in an effort to obtain an estimate of the number and characteristics of the unemployed registrants in that electorate, would be misleading as the distribution of population and unemployment within each CES Office area is unlikely to be uniform. > >With this caveat in mind, as stated in my answer to the honourable member for Werriwa 's question No. 219 of 9 March, 1977, I am prepared to provide statistics of the numbers, age and sex of persons registered as unemployed in Offices of the CES contained in the respective electorates as requested by the honourable member but, as statistics of occupational categories for which unemployed persons are registered are not normally published by CES Office areas I do not consider that the considerable clerical effort involved in their extraction would be justified for part (3) of the honourable member's question. > >The following are the answers, in terms of CES Office areas, to parts (1) and (2) of the honourable member's question: > >Pans of two Employment Office areas fall within the boundaries of the Federal Electoral Division of Hughes as presently constituted, viz. Caringbah and Wollongong. The respective proportions of the two Employment Office areas involved are 50 per cent of Caringbah and 40 per cent of Wollongong. > >The Federal Electoral Division of Cook as presently constituted is entirely contained within the Employment Office area of Caringbah and constitutes approximately 50 per cent of the area of that Employment Office. Details for Caringbah Employment Office are shown above. > >Pans of two Employment Office areas fall within the Federal Electoral Division of Cunningham as presently constituted, viz. Wollongong and Warilla. The respective proportions of the two Employment Office areas involved are 60 per cent of Wollongong, details of which are shown above, and 30 per cent of Warilla, for which details are: > >The percentage of persons who were (a) males and ( b) females (i) under 2 1 years of age and (ii) 2 1 years of age and over for each of the Employment Office areas comprising the relevant Electoral Divisions at 31 December 1975 and 3 1 December 1976 were as follows: {:#subdebate-87-29} #### Schools Commission Payments (Question No. 696) {: #subdebate-87-29-s0 .speaker-K9M} ##### Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP asked the Minister representing the Minister for Education, upon notice, on 21 April 1977: >What sums were paid by the Schools Commission in direct assistance to Government schools and under each program for non-Government schools in the Electoral Divisions of Hughes, Cook and Cunningham in 1976. {: #subdebate-87-29-s1 .speaker-EE6} ##### Mr Viner:
LP -- The Minister for Education has provided the following reply to the honourable member's question: >It is not possible to provide information in respect of payments to individual government schools except in relation to grants made under the Special Projects (Innovations) Program. The Commonwealth Government provides bulk funding to the New South Wales Government for government schools programs to disburse on a needs basis as it sees fit. Payments to government schools under the Innovations Program are set out in the attached tables. {:#subdebate-87-30} #### Calare and Macquarie: Telephone Exchanges (Question No. 703) {: #subdebate-87-30-s0 .speaker-KKT} ##### Mr MacKenzie:
CALARE, NEW SOUTH WALES asked the Minister for Post and Telecommunications, upon notice, on 26 April 1977: {: type="1" start="1"} 0. 1 ) What are the locations of (a) fully automatic and (b) manual telephone exchanges in the Electoral Divisions of Calare and Macquarie. 1. How many persons are employed by Telecom at each of these exchanges. 2. Which of the manual exchanges were converted to automatic operation in 1974, 1975 and 1976. 3. Which of the manual exchanges are programmed for conversion in 1977, 1978, 1979 and 1980. 4. Which of the manual exchanges have been expanded in capacity or upgraded, but not converted to automatic exchanges, in 1975 and 1976, and which are programmed to be so expanded or upgraded in 1977, 1978, 1979 and 1980. {: #subdebate-87-30-s1 .speaker-KZL} ##### Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) and (2) The accompanying lists show the information requested. 1. The exchanges convened to automatic in the years mentioned were as follows: 2. In Macquarie, the Wallerawang exchange is expected to be convened to automatic during June 1977. The Ginkin Meadow Flat and Oberon exchanges have been tentatively scheduled for conversion during 1978 but Telecom has stressed that this programming is subject to review in the light of the resources available and the relative urgency of other projects. Telecom has no immediate plans for any other exchange conversions in Macquarie and at this stage none of the remaining manual exchanges in Calare have been firmly programmed for conversion to automatic. {: type="1" start="5"} 0. Macquarie Electoral Division- None of the manual exchanges were extended or upgraded in 1975 or 1976. The only extension work planned is the installation of four additional Directory Assistance positions in the Penrith Manual Assistance Centre. Calare Electoral Division- No manual exchanges were extended or upgraded in 1975 but during 1976 one additional operating position was installed in the Canowindra and Gulgong exchanges to provide increased capacity. Telecom has no plans to extend or upgrade any other manual exchange in Calare. Telephone exchange locations in electoral division of Macquarie {: type="a" start="a"} 0. Automatic Exchanges Note: The number of persons employed at staffed exchanges is shown in brackets. Bathurst (23), Blackheath, Bogee, Brewongle, Castlereagh, Dunkeld, Eglington, Essington, Fitzgeralds Valley, Glenbrook (8), Hartley, Hazelbrook, Jocelyn, Katoomba (18), Killongbutta, Lawson, Leura, Limekilns, Lithgow (21), Megalong, Mt Victoria, Mozart Mulgoa, Norway, O'Connell, Olinda, Peel, Penrith (74), Portland, Raglan, Rydal, Springwood (10), Warrimoo, Wentworth Fails, Yetholme. {: type="a" start="b"} 0. Manual Exchanges Telephone exchange locations in electoral division of Calare {: type="a" start="a"} 0. Automatic Exchanges Note: The number of persons employed at staffed exchanges is shown in brackets. Alectown, Barry, Beargamil, Bedgerebong, Belgravia, Belubula, Binagundra, Binni Creek, Bocoble, Bogan Gate, Borenore, Bruie Plans, Bulgandramine, Bundaburrah, Burdett, Canobolas (9), Carawandool, Carrawobbitty, Carrobolin, Cookamidgera, Cooks Myall, Corinella, Cudal, Cumbijowa, Daroobalgie, Driftaway, East Guyong, Eurunderee, Eugowra, Forbes (16), Garema, Genaren, Goonumbla, Home Rule, Inchgower, Jemalong, Larras Lee, Lewis Ponds, Lidster, Long Point, Louisiana, Mandagery, March, Mudgee (17), Mullamuddy, Mulyandry, Mungery, Murga, Nelungaloo, Nyrang Creek, Ooma, Ootha, Ophir, Orange (65 ), Paytens Bridge, Parkes (38), Piambong, Rock Forest, South Grawlin, Spring Hill, Spring Side, Stuart Town, Summervale, Tallawang, Tichboume, Tomingly, Twelve Mile, Vychan, Walli, Warroo, Weelong, Wuulman, Wynola. {: type="a" start="b"} 0. Manual Exchanges {:#subdebate-87-31} #### Commercial Agents: Rights and Obligations (Question No. 707) {: #subdebate-87-31-s0 .speaker-JSU} ##### Mr Bryant: asked the Minister representing the Minister for Industry and Commerce, upon notice, on 27 April 1 977: {: type="1" start="1"} 0. 1 ) Is the Minister prepared to introduce legislation along similar lines to that operating in the Common Market Countries governing the laws relating to Manufacturers' Agents or Commercial Agents as they are known in Europe. 1. Has the Minister rejected a submission made to him by the Apparel and Fashion Agents Association of Australia. 2. If so, has the Minister advised them that the *laissez /aire* conditions of the 1 9th Century are to continue, or to put it another way, the law of the jungle is still to prevail. {: #subdebate-87-31-s1 .speaker-ZD4} ##### Mr Howard:
LP -- The Minister for Industry and Commerce has provided the following answer to the honourable member's question: {: type="1" start="1"} 0. I have received representations from the Apparel Agents Association- formerly the Federal Association of Fashion Agents- concerning the possibility of Federal legislation to clarify the rights and obligations of commercial Principals and Agents. The representation was based on certain proposals for legislation in the European Economic Community. Highly complex questions of law and public policy are involved and I have these issues under examination in consultation with my colleagues the Attorney-General and the Minister for Business and Consumer Affairs. {: type="1" start="2"} 0. No. 1. 3 ) See answer to ( 2 ) above. {:#subdebate-87-32} #### Performance of Australian Meat Board (Question No. 758) {: #subdebate-87-32-s0 .speaker-KYU} ##### Dr Richardson:
TANGNEY, WESTERN AUSTRALIA asked the Minister for Primary Industry, upon notice, on 28 April 1977: {: type="1" start="1"} 0. 1 ) Has the Australian Meat Board failed to perform its functions properly or satisfactorily. 1. If so, in what way. {: #subdebate-87-32-s1 .speaker-5E4} ##### Mr Sinclair:
NCP/NP -The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) and (2)1 believe that, by and large, the Meat Board has performed its functions well in the very difficult meat marketing circumstances of the last few years. {:#subdebate-87-33} #### Australian Meat Board: Constitution (Question No. 759) {: #subdebate-87-33-s0 .speaker-KYU} ##### Dr Richardson: asked the Minister for Primary Industry, upon notice, on 28 April 1977: {: type="1" start="1"} 0. 1 ) Is he considering the reconstitution of the Australian Meat Board; if so, why. 1. Are the present powers of the Australian Meat Board adequate to exercise that degree of regulation and control over the export meat trade consistent with the continued existence of free enterprise in the industry. 2. Are the trading powers sufficient to enable the Board to carry out its limited trading functions. 3. Would a change in the relative representation on the Board be an implied criticism of the present members; if not, why not. 4. In what way is the present membership inadequate or improper. 5. Should the representation on the Board of the producers of meat be reduced further, to the point where they will have lost their majority on the Board; if so, why should it be so reduced. 6. Should representation on the Board of the meat exporters, who are the owners of the commodity at the point of export, be reduced further; if so, why. 7. Should the representative/s of the meat exporters continue to be nominated by the Meat Exporters Council. 8. Should a person be appointed to the Board on the ground only of his 'special qualifications'. 9. 10) If he is considering the reconstitution of the Board, what will be the qualifications for appointment to the Board after that reconstitution. 10. Will processors and exporters of meat be adequately represented on the reconstituted Board; if so, by what means. {: #subdebate-87-33-s1 .speaker-5E4} ##### Mr Sinclair:
NCP/NP -The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) to ( 1 1 ) I refer the honourable member to the second reading speech which I delivered when introducing the Australian Meat and Live-stock Corporation Bill into this House on 26 May 1977. 1 believe that answers to all parts of the honourable member's question were contained in the speech. 1 Effects of Staff Ceilings (Question No. 768) {: #subdebate-87-33-s2 .speaker-5J4} ##### Mr Scholes: asked the Prime Minister, upon notice, on 28 April 1 977: >Have Government departments, authorities and other organisations subject to staff ceilings been directed to let out work to private firms where it is found impossible for it to be performed at existing staff levels. {: #subdebate-87-33-s3 .speaker-QS4} ##### Mr Malcolm Fraser:
LP -- The answer to the honourable member's question is as follows: >No such direction has been given. In relation to Government departments and authorities staffed under the Public Service Act, the engagement of consultants or other contractors for service is still subject to strict control and requires the prior approval of the Public Service Board. > >Earlier this year, departments were advised that the Government had reaffirmed the need to limit the use of consultants to those whose employment is strictly essential to efficient and economical operations. > >Ministers had earlier been asked to apply this same test to all statutory authorities within their Ministry which are financed wholly or partly from the Budget. {:#subdebate-87-34} #### Telecommunications Commission and Postal Commission: Use of Private Contractors (Question No. 774) {: #subdebate-87-34-s0 .speaker-5J4} ##### Mr Scholes: asked the Minister for Post and Telecommunications, upon notice, on 28 April 1977: {: type="1" start="1"} 0. 1 ) Is the Telecommunications Commission or the Postal Commission letting out to private contractors, typing, computer programming and other work normally undertaken by staff of the Commissions. 1. If so, is this action made necessary by lack of staff in clerical areas. 2. ) What is the cost of using private contractors. 3. Were the firms used for this work determined by tender, if so, who was the lowest tenderer. 4. 5 ) If tenders were not let, what method was used in determining where the excess work would be placed. 5. What additional staff would be required to allow the Commissions to perform internally the work now subject to private contract. {: #subdebate-87-34-s1 .speaker-KZL} ##### Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. The Telecommunications Commission has placed orders with private contractors for typing and computer programming services. The Postal Commission has used private contractors for typing services. 1. No. Intermittent work loadings and recruitment difficulties are the main factors. 2. Costs from 1 July 1976 to date Telecommunications Commission: >Typing: $3433 > >Computer Programming:$ 1 22,639 > >Postal Commission: > >Typing: $1,431. > >Yes, in relation to the Telecommunications Commission. Different firms are used and the lowest tenderer suitable for the particular type of work involved is selected. There was one exception where typing at a cost of $108 was placed with a previously used agency to save time and administrative costs. The Postal Commission uses competitive quotations where the value of the projected work exceeds $100. The only instance of this occurred in Tasmania where the lowest and selected quotation was C. M. Staff Centre, Launceston. > >The Postal Commission uses the standard quotation procedure. > >As the typing workload is of an irregular nature in both Commissions, no additional typing staff is warranted. Telecom Australia advises that5 additional computer programming staff would be required for the particular projects. Programming staff are in short supply however, and it is extremely difficult for the Commission to recruit, at the present time, staff with the necessary qualifications and abilities. {:#subdebate-87-35} #### Investment Allowance (Question No. 785) {: #subdebate-87-35-s0 .speaker-RK4} ##### Mr Hayden: asked the Prime Minister, upon notice, on 3 May 1977: {: type="1" start="1"} 0. Did Statement No. 4 to the 1976-77 Budget Speech note that the investment allowance scheme introduced by his Government was expected to cost $200m in 1976-77 and $600min 1977-78. 1. If so, was this estimate based on forecasts of the likely level of private sector investment in 1976-77 and 1977-78. 2. Has his attention been drawn to the report in the *Australian Financial Review* of 5 April 1977, that in recent speeches he has suggested that the actual cost of the investment allowance will be no more than $ 100m in 1976-77 and $450m in 1 977-78; ifso, is the report accurate. 3. Has the Government now revised the forecasts of private sector investment for 1976-77 and 1977-78 downwards by a substantial amount; if so, by what sum. 4. Does the Government still consider that there will be an'investment-led recovery'. {: #subdebate-87-35-s1 .speaker-QS4} ##### Mr Malcolm Fraser:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. Statement No. 4 attached to the 1976-77 Budget Speech contained a note indicating that the investment allowance announced on 20 May 1976 was estimated to cost $200m in 1 976-77 and $600m in a full year. 1. Yes. The estimates are based on forecasts of the level of investment, but the cost to revenue lags investment by one year as tax is payable by businesses generally in the year following the year of income. The cost to revenue of investment allowance in 1976-77 and 1977-78 therefore depends on the level of investment in 1975-76 and 1 976-77 respectively. 2. The 1976-77 estimate has since been reduced to $100m and the 1977-78 estimate, previously $550m, was put at $450m in the light of the results of a survey which suggested that the lead time (i.e. the period between the ordering of the plant-after 31 December 1975-and its installation) was greater than had been expected. Furthermore, although, on review, the level of private investment in plant adopted for the purpose of the estimate was higher than that previously adopted, the survey results indicated that the range of equipment not covered by the new allowance was greater than had been anticipated. 3. No; see answer to (3) above. 4. A revival in investment forms only part of the Government's strategy for economic recovery. The Government's aim ever since it took office has been to achieve a balanced, sustained expansion in economic activity. The severe slump in non-dwelling investment during the first half of the 1970s has impaired the provocative capacity of the economy. Recovery is thus more than usually subject to the danger of quickly meeting supply constraints which could rekindle inflation and abort the recovery. Against that background the Government has chosen a strategy which rests at least partly on the proposition that private investment expenditure should play a conspicuous role relatively early in the course of the recovery. There is a normal tendency in the recovery process for non-dwelling investment to lag behind the recovery in other areas. The investment allowance is designed to shorten that lag by encouraging businessmen to bring forward new investment. In this way, capacity will expand as activity expands, instead of waiting until bottlenecks are encountered, by then of course it is too late. Indications are that investment in plant and equipment has, in fact, been moving in step with the overall recovery. In 1976, private gross fixed capital expenditure on plant and equipment, in constant prices, was 6.4 per cent higher than in 1975. Expenditure in the second half of 1976 was 7.6 per cent higher than in the second half of 1975. {:#subdebate-87-36} #### Rear Admiral B. J. Castles, C.B.E. (Question No. 790) {: #subdebate-87-36-s0 .speaker-RK4} ##### Mr Hayden: asked the Minister for Defence, upon notice, on 3 May 1977: {: type="1" start="1"} 0. 1 ) Was a **Mr Castle** a senior member of the DDL (light destroyer) project office,ifso, for what period. 1. Did the DDL project office recommend a Rolls Royce power plant for the DDL. 2. Can he say whether **Mr Castle** subsequently took up a position with Rolls Royce. 3. Can he also say whether **Mr Castle** is now with Director Techniques des Constructions Navale of France. 4. Has this organisation recently been awarded a contract for project definition of the underway replenishment ship. {: #subdebate-87-36-s1 .speaker-4U4} ##### Mr Killen:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) Rear Admiral B. J. Castles, CBE was the Chief of Naval Technical Services during the period 15 March 1969 to 21 July 1972 and would have had responsibility for the DDL team without being a member of it. 1. After extensive study by an Interdepartmental Committee of several systems available, a Rolls Royce propulsion system was recommended for the DDL as the most appropriate. 2. B. J. Castles and Associates, Consulting Engineers, were appointed as consultants for marine engineering matters to Rolls Royce from 25 August 1972 to 31 December 1976. 3. B. J. Castles is the Australian representative of SOFREXAN a French agency involved in the overseas marketing of Naval Materiel, including ships, built by the French Government owned shipbuilder, Direction Techniques des Constructions Navale (DTCN). 4. On 4 February 1977, Direction Techniques des Constructions Navale was awarded a contract for a Project Definition Study for the supply of an Underway Replenishment Ship to the Royal Australian Navy. Contractual arrangements for this Study were negotiated directly between the Australian Government and DTCN Assistance to the Arts (Question No. 791) {: #subdebate-87-36-s2 .speaker-CV4} ##### Mr Jacobi: asked the Minister Assisting the Prime Minister in the Arts, upon notice, on 3 May 1977: {: type="1" start="1"} 0. 1 ) Did he advise me, in answer to parts (5) to ( 1 1 ) of Question No. 1694 *(Hansard,* 9 December 1976, page 3724), that certain information would be obtained and be provided in writing as soon as possible. 1. Is it a fact that as at 29 March 1977 this information had not been received. 2. 3 ) Is he yet in a position to provide the information. 3. What is the reason for the inordinate delay in making this information available. {: #subdebate-87-36-s3 .speaker-GY5} ##### Mr Staley:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) Yes. I have forwarded the information to the honourable member. 1. Yes. 2. Yes. 3. To answer the honourable member it was necessary for the Australian Film Commission to refer to accounting records compiled by the former Australian Film Development Corporation, the former Australian Council for the Arts, the Australia Council and the Commission itself. This work took longer to complete than I would have wished. Assistance to the Arts: Film Production (Question No. 792) {: #subdebate-87-36-s4 .speaker-CV4} ##### Mr Jacobi: asked the Minister Assisting the Prime Minister in the Arts, upon notice, on 3 May 1977: {: type="1" start="1"} 0. 1 ) Did he advise me that details on the investment structure of films in which the Australian Film Commission had not participated were not available *(Hansard,* 9 December 1976, page 3724). 1. If so, does his answer imply that details are available to the Commission on the films to which it has contributed; if not, why not. 2. If financial figures are available, who has received the box office proceeds of the following films in terms of (a) the producers, (b) the distributors and (c) the exhibitors: (i) *Picnic at Hanging Rock,* (ii) *Caddie,* (iii) *Mad Dog Morgan,* (iv) *The Devil's Playground,* (v) *Between Wars,* (vi) *The Cars that Ate Paris,* (vii) *Sunday Too Far Away,* (viii) *The Trespassers, (* ix ) *Pure s* and ( x ) *Summer of Secrets.* 3. What amounts have been received by each group in respect of each film referred to in part (3). {: #subdebate-87-36-s5 .speaker-GY5} ##### Mr Staley:
LP -The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. Yes. 1. Yes. 2. and (4) As an investor in production, the Australian Film Commission and its predecessor, the former Australian Film Development Corporation, shares with the producer under the terms of the distribution contract the amount of information it obtains from distributors and exhibitors on the marketing performance in Australia of those Australian films in which it invested. Most recent contracts negotiated by producers with assistance from the Commission include a requirement that gross box office income be notified in future. While the Australian Film Commission Act 1975 contains a provision (Section 12) for the Commission to keep itself informed on all aspects of making, promoting, distributing and exhibiting films in Australia, it is not obliged to publish any of this information Details of earnings on individual films by the various sectors of the film industry are of critical commercial importance to those private companies in relation to their competitors. For this reason it would seem to be preferable to keep such details confidential. However, I shall be in touch with the honourable member to see to what extent information required by him is available. The need for accountability in the disbursement of large sums of public monies to private companies and individuals concerns me greatly and I will discuss with the Chairman of the Film Commission the possibility of presenting some financial details on each project in which the Commission is involved when issuing its annual reports in future. {:#subdebate-87-37} #### Mr K. C. Gale: Liberal Industrial Relations Policy (Question No. 793) {: #subdebate-87-37-s0 .speaker-6U4} ##### Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP am asked the Prime Minister, upon notice, on 3 May 1977: >What have been the dates, nature and purpose of his contacts with **Mr Keith** Compton Gale who, according to reports submitted by **Mr John** Spender, Q.C., pursuant to appointments by the Lewis, Willis and Wran governments under the Companies Act, borrowed over $900,000 in August 1974 and subsequent months from the Gollin companies while he was managing director for his private purposes and for quite impermissible uses. {: #subdebate-87-37-s1 .speaker-QS4} ##### Mr Malcolm Fraser:
LP -- The answer to the honourable member's question is as follows: >These contacts related to an offer of assistance to the Liberal Party in the preparation of Industrial Relations Policy. That assistance was provided for a limited period. {:#subdebate-87-38} #### Solar Energy Research: Australian National University (Question No. 817) {: #subdebate-87-38-s0 .speaker-L6X} ##### Mr Garrick:
BATMAN, VICTORIA asked the Minister representing the Minister for Education, upon notice, on 4 May 1977: {: type="1" start="1"} 0. 1 ) Can the Minister say whether nuclear physicists at the Australian National University have decided to abandon a major solar energy project as being too practical and simple for a university. 1. 2 ) If so, did this decision deprive Professor Steven Kaneff of the $1.4m needed over the next 5 years to perfect the ability to tap, store and even export solar energy. 2. Can the Minister say if Professor Kaneff has claimed that his research indicates that the project he is working on could generate enough heat energy to power a city the size of Adelaide. 3. Can the Minister also say whether the Australian National University has instead decided to reserve its funds for research into pure science such as nuclear physics and diffusion research. 4. 5 ) If so, is this a reaction to the pro-nuclear lobby. 5. Does the Government consider that solar energy research is worthy of priority spending. {: #subdebate-87-38-s1 .speaker-EE6} ##### Mr Viner:
LP -- The Minister for Education has provided the following answer to the honourable member's question: {: type="1" start="1"} 0. 1 ) to (5) I am advised that the research project in question is the solar-ammonia project which is being conducted within the Department of Engineering Physics, Research School of Physical Sciences at the Australian National University. The project has been concerned with studying processes for the mass utilisation of solar energy, using ammonia as a means of chemical storage, with a view to developing a 10 megawatt power generation station. A power station of this size could supply enough electricity to serve a town of 10 000 people. The solar-ammonia project has been funded from the be- f inning of 1974 to the present time from the resources of the Research School of Physical Sciences but the project has now reached a stage where the level of funding required exceeds the financial capabilities of the School. It was estimated by the research group, in their submission of May 1976 to the Senate Standing Committee on National Resources, that further development of the project to the point where a significant pilot plant could be constructed would require about $2.0m over a period of S years. On the assumption that University funding could continue at the current level, an additional amount of about $1.4m would be needed to reach the required level of funding. The future of the solar-ammonia project has been reviewed within the University over the last 18 months as part of an overall review of the research programs of the Research School of Physical Sciences. The review, which involved both internal and external assessors, considered that' the required level of funding was beyond the means of the Research School and the University. It was therefore decided that the School should continue to support the project to the end of 1977. The expectation is that the technological and economic viability of the process will then have been examined to determine the feasibility of proceeding to the first production stage of a 10 MW electrical generating station. The University has recognised that there is a place for applied work of this nature in the Research School of Physical Sciences, although the primary role of this and other Research Schools is to undertake fundamental scientific research. Financial constraints are such that work of an applied nature can be supported only during an initial exploratory phase, on the understanding that funding from sources outside the University must be obtained before any extension to the often much more costly development phase can proceed. {: type="1" start="6"} 0. The determination of the Government's policy on energy research is a matter for consideration, in the first instance, by my colleague the Minister for National Resources. {:#subdebate-87-39} #### Public Service Retirements (Question No. 828) {: #subdebate-87-39-s0 .speaker-EE4} ##### Mr Uren: asked the Minister Assisting the Prime Minister in Public Service Matters, upon notice, on 5 May 1977: {: type="1" start="1"} 0. 1 ) How many permanent officers of the Australian Public Service have retired since 1 January 1976. 1. How many of these officers came from each of (a) the First Division, (b) the various levels of the Second Division, (c) the various classes of the Third Division, and (d) the various grades of the Fourth Division. 2. How many in each category in part (2) were (a) male and (b) female. 3. How many in each category in part (2) retired on grounds of invalidity. 4. Of those who retired on age grounds how many (a) retired at age 63 and ( b) opted to retire at an earlier age. 5. Of those who retired on invalidity grounds, what were the more regularly occurring medical reasons for their invalidity, and are any of these considered to be an occupational health hazard. 6. What are the comparative figures in respect of parts (2), (3), (4) and (5) for each of the calendar years 1973, 1974, 1975 and 1976. {: #subdebate-87-39-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) to ( 5 ) and ( 7 ) The Public Service Board has provided the consolidated information in the following tables for the calendar years 1973 to 1976 inclusive. The groupings used for the Third and Fourth Division statistics were chosen as being representative of levels of responsibility within those Divisions. 1. Records detailing the medical reasons for invalidity retirement are not centrally kept. To obtain this information would require considerable effort and man-hours, which I am not prepared to authorise. {: type="a" start="c"} 0. The grouping represents Clerical Assistant Grades S and above, Grade 4, Grade 3 and Grades 1 and 2. Officers retiring from non-Clerical Assistant positions have been equated with this grouping on the basis of the maximum salary of the position from which each retired. {:#subdebate-87-40} #### Bellerive Health Centre, Tasmania (Question No. 849) {: #subdebate-87-40-s0 .speaker-2E4} ##### Mr Lloyd: asked the Minister for Health, upon notice, on 5 May 1977: {: type="1" start="1"} 0. How many doctors are employed at the Bellerive Health Centre in Tasmania. 1. How many (a) are salaried and (b) receive fee for service. 2. 3 ) What is the total salary bill and how many patients did these salaried doctors see in the last six months period for which figures are available. 3. Are salaried doctors allowed to charge fees and collect medical rebates. 4. What after hours and weekend service is provided, by whom is it provided, how is it financed, and are there special salary rates applicable. {: #subdebate-87-40-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -The answer to the honourable member's question is as follows: >It is assumed that the honourable member refers to the Clarence Community Health Centre, located in Bayfield Street, Bellerive, Hobart. Prior to the commencement of services from this Centre on 2 May 1977, services were provided from temporary premises located at 238 Rokeby Road, Howrah. Some information provided in this answer relates to the operation of the temporary Centre. The following information has been obtained in consultation with the Tasmanian health authorities- > >1 ) The equivalent of approximately four full-time medical practitioners. > >(a) The Centre employs the equivalent of approximately 3.5 salaried medical practitioners and, in addition, sessionary paid medical practitioners provide approximately six sessions, each of 316 hours duration, per week, (b) There are no medical practitioners who charge fees for their own use. > >The salary bill in respect of salaried and sessionary paid general medical practitioners employed at the Centre is estimated at $149 500 for 1976-77. During the most recent six- months period for which figures are available, viz., > >November 1976 to April 1977, these medical practitioners provided 10 007 patient consultations. > >No. The current arrangements are that the Department of Health Services, Tasmania, proposes to impose charges equivalent to medical benefits payable in respect of professional services rendered by salaried medical practitioners at the Centre to privately insured persons. Medical benefits organisations are required to pay fund benefits in accordance with the basic medical benefits table to contributors who are charged for professional services received at the Centre. Accounts will be issued for such services by and in the name of the Department of Health Services, Tasmania, and will show the name of the medical practitioner who renders the service. > >A 24 hour, seven day a week service is provided from the Centre. A nursing service is available at the Centre at all times, and a medical practitioner is available on-call out of hours. The out of hours service is financed jointly by the Commonwealth and State Governments through the Community Health Program, which is also the source of funding for the other operational costs of the Centre. Staff rostered for duty or on-call during out of hours periods are entitled to penalty rates in accordance with normal State Public Service awards. {:#subdebate-87-41} #### Specialist Referral Forms (Question No. 852) {: #subdebate-87-41-s0 .speaker-2E4} ##### Mr Lloyd: asked the Minister for Health, upon notice, on 5 May 1977: {: type="1" start="1"} 0. 1 ) Why are specialist referral forms or vouchers required to be provided by general l practitioners 1. How many of these forms are processed each year by his Department, and how many persons are employed to do this processing. 2. What checks are made to ensure that the forms are in order. 3. How many prosecutions, or 'please explain' queries, were initiated in the latest year for which figures are available. 4. 5 ) Are there other ways of achieving the same result. 5. Can he say whether any other countries require a similar specialist referral form. {: #subdebate-87-41-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) The present referral system, which was introduced on 1 November 1970, was directly based on the recommendations of a special working party which included senior representatives of the medical profession. A formal system was considered necessary because of the introduction at that time of higher benefits for a large number of services when rendered by specialists and consultant physicians to referred patients. The system is a formalisation of procedures which previously existed within the medical profession, and provides written evidence that a referral has taken place. The referral requirements relate solely to the payment of medical benefits. The system recognises the fundamental right of a patient to seek referral to a specialist or consultant physician, and that, when referral is requested, medical benefits are payable at the appropriate higher rate. The system also acknowledges that, as a general rule, an initial consultation by a general practitioner is in the best interests of the patient. 1. The only statistical information available relates to the number of services for which benefits have been paid at the specialist rate. Referral certificates may be valid for periods up to three months or twelve months and there is no way of knowing how many specialist services may be performed during these periods in respect of any referral certificate. Moreover, in the case of surgical operations, for example, a referral certificate may cover procedures performed by as many as three specialists- the surgeon, the assistant surgeon and the anaesthetist. No special staff are employed to process referral certificates. Checks to ensure that referral certificates are provided where necessary to enable benefits to be paid at the higher specialist rate are carried out as a normal assessing procedure. Notices of referral are processed by Medibank and private medical benefits funds in assessing benefits, not by the Department. Printing of notices of referral pads is arranged by the Department; however the current annual printing requirements are approximately 100,000 pads comprising SO notices to a pad. 2. See (2) above. 3. Information regarding 'please explain' queries is not available. There have been no prosecutions relating to referral forms. 4. Unless a referral system is used, specialists could be overwhelmed by patients, many of whom may require only G.P. treatment. The referral system is a filter for the protection of patients, general practitioners and specialists. The current referral system is considered to be the most satisfactory method of achieving the desired result, providing a relatively easy and economical procedure which has been successful in meeting the majority of cases involving the need for specialist treatment. The Medibank Review Committee considered the operation of the referral system during its examination of Medibank in 1976, but did not propose any changes. 5. From the information available to my Department, it seems that various forms of specialist referral systems operate in a number of countries, including Canada, France, The Netherlands, New Zealand, Britain, Austria, Israel, Italy, Denmark, Norway, Finland and Yugoslavia. The referral may be to a private or salaried specialist attached to a hospital or polyclinic, or to a private practising specialist. Referral forms or cards are in use in some of these countries, however, little detail is known about their referral mechanisms. {:#subdebate-87-42} #### Foreign Minister's Visit to Bali (Question No. 857) {: #subdebate-87-42-s0 .speaker-6U4} ##### Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP am asked the Prime Minister, upon notice, on 5 May 1 977: >Following his statement on 3 May 1977 *(Hansard,* page 1442) that the copy of the document published by the *Canberra Times* that day and incorporated in *Hansard (page* 1446) bore markings different from the ones on the departmental document, does he now realise, as stated by the newspaper on 4 May, that the markings were added to the copy of the document by the newspaper itself on 2 May. {: #subdebate-87-42-s1 .speaker-QS4} ##### Mr Malcolm Fraser:
LP -- The answer to the honourable member's question is as follows: >I am aware of what has been said on this issue in the *Canberra Times.* {:#subdebate-87-43} #### Commonwealth Canteens (Question No. 860) {: #subdebate-87-43-s0 .speaker-QF4} ##### Mr Connolly:
BRADFIELD, NEW SOUTH WALES asked the Minister for Employment and Industrial Relations, upon notice, on 24 May 1977: {: type="1" start="1"} 0. 1 ) How many canteens are operated on Commonwealth premises for the benefit primarily of Commonwealth public servants. 1. Where are these canteens, which of them are managed under contract by independent contractors, and which are managed by the Commonwealth. 2. Are those canteens managed by the Commonwealth subsidised in any way by the Commonwealth; if so, what is the size of the subsidy or loss in each case. 3. Do any of the canteens referred to in part (3) make a profit; if so, which canteens, and what is the size of their individual profits. 4. What is the role in canteen management of Commonwealth Hostels Limited. {: #subdebate-87-43-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) A total of 61 food services are operated primarily for the benefit of Commonwealth employees. 1. The services are listed below, 2 being managed by independent contractors and the remaining 59 by Commonwealth departments. {: type="1" start="3"} 0. Food services managed by the Commonwealth are expected to operate on a break-even financial basis, subject to the following costs being met from departmental appropriations, in accordance with long-standing policy: {: type="i" start="i"} 0. alterations or repairs to buildings; 1. heating and lighting buildings; 2. initial cost and replacement of plant and equipment (not including replacement of patrons' utensils etc.); 3. initial stocks of kitchen utensils and patrons' utensils such as crockery, cutlery, *trays,* etc.; 4. expenses in connection with the cleaning of public portions of food services and outside walls and windows etc.; 5. workers' compensation payments, medical expenses and payments for furlough. Only 2 Defence Department services receive specific subsidies, the services in question and the amounts of the grants being as follows: {: type="i" start="i"} 0. HMA Naval Dockyard, Garden Island, Sydney $553 per week; 1. HMA Naval Dockyard, Nelson Place, Williamstown $233 per week. These subsidies are recognised as necessary to offset excess labour costs necessarily incurred due to the excess size and other unusual features of these services; without these subsidies their patrons would be at a serious financial disadvantage relative to those of other Commonwealth food services. The cumulative net losses incurred since 1.1.55 by 34 services are indicated in the answer to question (2)- see column headed 'Cumulative Net Result as at 25.2.77. ' {: type="1" start="4"} 0. The cumulative net profits earned since 1. 1.55 by 35 services are also shown in the answer to question (2)- see column headed 'Cumulative Net Result as at 25.2.77. ' 1. As from 26.6.77, Commonwealth Hostels Limited is progressively assuming responsibility for operation of all *employee food services* currently managed by departments and, in doing so, will be required to cover only the same costs as the cafeterias have previously borne. {:#subdebate-87-44} #### Unemployment Statistics (Question No. 863) {: #subdebate-87-44-s0 .speaker-L0J} ##### Mr Sainsbury:
EDEN-MONARO, NEW SOUTH WALES asked the Minister for Employment and Industrial Relations, upon notice, on 24 May 1977: {: type="1" start="1"} 0. 1 ) When will separate statistics be published combined in Queanbeyan office of the Commonwealth Employment Service. 1. Why are Australian Capital Territory employment statistics included with the New South Wales statistics, and when will they be published separately. 2. When will his Department publish unemployment statistics indicating the number of adults and juniors unemployed. 3. Why was publication of the number of unemployment benefit recipients at Bega discontinued in June 1 976. {: #subdebate-87-44-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) The Queanbeyan Office of the Commonwealth Employment Service is at present a branch of the Canberra Office and the activities of the two are combined in published statistics. Queanbeyan statistics will be reported separately if a separate office of the Commonwealth Employment Service is opened in Queanbeyan. 1. The Australian Capital Territory labour market is regarded as part of an area of New South Wales. I have no intention of publishing separate statistics for the Australian Capital Territory at the present time. 2. Statistics of adults and juniors registered as unemployed with the Commonwealth Employment Service are currently published on a State basis in the Department's Monthly Review of the Employment Situation. 3. The Department of Social Security hopes to be able to resume the extraction of these area statistics in the near future. The information ceased to be extracted with the introduction of a system of bulk mailing of cheques. Commonwealth Employment Service: Reports on Refusal of Employment Offers (Question No. 868) {: #subdebate-87-44-s2 .speaker-0K4} ##### Mr Wilson:
STURT, SOUTH AUSTRALIA asked the Minister for Employment and Industrial Relations, upon notice, on 24 May 1977: {: type="1" start="1"} 0. 1 ) Does the Commonwealth Employment Service inform the Department of Social Security of persons registered for unemployment who refuse an offer of suitable employment. 1. If so, does the Commonwealth Employment Service keep statistics of these reports. 2. If statistics are kept, how many persons have been reported in each State in each month since 1 July 1976. {: #subdebate-87-44-s3 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. Yes. 1. No. 2. Not applicable. {:#subdebate-87-45} #### Unemployment Registrations: Western Sydney (Question No. 875) {: #subdebate-87-45-s0 .speaker-6U4} ##### Mr E G Whitlam:
WERRIWA, NEW SOUTH WALES · ALP am asked the Minister for Employment and Industrial Relations, upon notice, on 25 May 1 977: {: type="A" start="1"} 0. I ) How many persons were registered as unemployed in the Employment Office areas of (a) Penrith, (b) Windsor, (c) Mt Druitt, (d) Blacktown, (e) Parramatta, (f) Fairfield, (g) Liverpool and (h) Campbelltown at the end of April 1976 and at the end of April 1977. {: type="1" start="2"} 0. ) What percentage of the persons was (a) males and (b) females (i) under 2 1 years of age and (ii) 2 1 years of age and over. 1. Will he give statistics of the principal work categories of the persons registered as unemployed in these 8 areas as he did for another 8 areas in his answer to **Senator Colston** on 10 December 1976 (Senate Hansard, pages 3122-3129). {: #subdebate-87-45-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. The number of persons registered as unemployed in the Employment Office areas requested were as follows: 1. The percentages of persons (a) males and (b) females (i) under 21 years of age and (ii) 21 years of age and over were as follows: 2. The principal work categories for which unemployed persons were registered were as follows: {:#subdebate-87-46} #### Funding of Public Libraries (Question No. 877) {: #subdebate-87-46-s0 .speaker-KB8} ##### Mr Giles:
ANGAS, SOUTH AUSTRALIA asked the Minister representing the Minister for Administrative Services, upon notice, on 24 May 1 977: {: type="1" start="1"} 0. 1 ) Can the Minister supply details of the expenditure by State Governments in their funding of public library systems. 1. If so, can the Minister distinguish between funds provided by State Governments for (a) free public libraries and (b) subscription institute libraries. 2. What is the position regarding the inter-departmental committee report on the 1976 Horton Report on public libraries in Australia. 3. Is the inter-departmental committee report to be made public. 4. When may a Government statement on the Horton Report be expected. 5. Is it possible for future Federal Government budgets to make matching grants available to State Governments in order to promote the growth of free public libraries. 6. Can the Minister say what different types of State legislation are applied to public library systems within each State, e.g. are costs shared $ for $ between State and local governments, etc. 7. Can the Minister also say whether State Governments provide within their legislation for State Library Boards with jurisdiction over public libraries throughout urban and rural communities. 8. If so, what States provide Boards, and what are their various powers. {: #subdebate-87-46-s1 .speaker-KVM} ##### Mr Street:
LP -- The Minister for Administrative Services has provided the following answer to the honourable member's question: {: type="1" start="1"} 0. 1 ) The latest details available to me are those provided in the Report of the Committee of Inquiry into Public Libraries, 'Public Libraries in Australia'. I particularly refer the honourable member to Appendix E at pages 137-139 and to Table 5. 1 at page 64 of the Report. 1. 2 ) See Appendix E referred to in (1 ) above. 2. The present position is as given by me in a Statement to the Senate, on 3 May 1977 (Senate *Hansard,* page 1072). 3. and (5) Decisions on these questions will be taken in association with decisions on the Government's overall policies for this area. 4. It is not accepted practice to answer questions on future policy. 5. , (8) and (9) See Report of the Committee of Inquiry into Public Libraries, 'Public Libraries in Australia', Appendix D, 'Legislation relating to Public Libraries' pages 134-136 and Appendix E, pages 137-139. {:#subdebate-87-47} #### Australian Travel Trade Missions (Question No. 884) {: #subdebate-87-47-s0 .speaker-KUX} ##### Mr Stewart: asked the Minister representing the Minister for Industry and Commerce, upon notice, on 25 May 1977: {: type="1" start="1"} 0. 1 ) Which travel organisations were represented on the recent Australian travel trade mission to North America. 1. ) Was the mission regarded as a success. 2. Are further travel trade missions being planned; if so, is Japan included in the countries to be visited; if not, why not. {: #subdebate-87-47-s1 .speaker-ZD4} ##### Mr Howard:
LP -The Minister for Industry and Commerce has provided the following answer to the honourable member's question: {: type="1" start="1"} 0. 1 ) Travel organisations represented on the recent Australian travel trade mission to North America were: Ansett Airlines of Australia Ansett-Pioneer Australian Adventure Tours Group Canberra Cruises & Tours Pty Ltd Captain Cook Cruises Carah Coaches Pty Ltd John Daley & Associates Pty Ltd House of David- Australian Adventure Campers Koala Park Towers Menzies Hotel MFA-Homestead Northern Territory Government Tourist Bureau Hotel Parmelia Queensland Government Tourist Bureau Sebel Town House Ltd South Australian Government Tourist Bureau Department of Tourism- Tasmania Tasmania Mobile Motels Pty Ltd The Tour Company Pty Ltd Tour Contractors Pacific Pty Ltd Tourmakers of the South Pacific Trans-Australia Airlines Travelodge Australia Limited United Touring Australia Pty Ltd World Travel Headquarters Pty Ltd In addition the following international airlines had booth representation at the workshops: Qantas Airways Ltd Pan American World Airways CP Air UTA French Airlines Air New Zealand {: type="1" start="2"} 0. The mission was regarded as a success by the Australian Tourist Commission and unanimously by the Australian participants. Although business was written at each of the seven workshops, experience has shown that a period of 18 months will need to elapse before an accurate quantifiable judgment can be made on the value of the travel the mission will have created. However, the Australian Tourist Commission has forecast it will be in excess of the $5m of identifiable new business created by the 1975 Task Force to North America. 1. ) Further travel trade missions are being planned. These include a small promotional and investigatory mission to South-East Asia, a full Task Force to U.K./Europe and a joint promotional mission with New Zealand to Japan. {:#subdebate-87-48} #### Fox Report (Question No. 895) {: #subdebate-87-48-s0 .speaker-K9M} ##### Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP asked the Minister representing the Minister for Administrative Services, upon notice, on 25 May 1977: {: type="1" start="1"} 0. 1 ) How many copies of the First Report of the Ranger Uranium Environmental Inquiry (the Fox Report), were printed. 1. ) How many copies of this Report were distributed without charge. 2. 3 ) To whom were the free copies distributed. 3. When were these free copies distributed. 4. What price was charged by the Australian Government Publishing Service for the Report, and were copies freely available at all AGPS bookshops. 5. What is the estimated print run of the Second Fox Report. 6. How many copies of this Report will be distributed without charge. 7. To whom will these free copies be distributed. 8. When will these copies be distributed. 9. When will copies of the Second Report be available from AGPS bookshops. {: type="I" start="II"} 0. Has the Minister's attention been drawn to reports that the Second Report is to cost SI 5 in total; if so, are the reports correct, and is it considered that the Government has fulfilled the recommendation of the First Report that widespread public debate should be facilitated. {: #subdebate-87-48-s1 .speaker-KVM} ##### Mr Street:
LP -- The Minister for Administrative Services has provided the following answer to the honourable member's question: {: type="1" start="1"} 0. 10 500. 1. 2500. 2. Parliamentarians, Press Gallery, Department of Environment, Housing and Community Development, Commissioners, Witnesses to the Inquiry, Persons and Organisations assisting the Commission, State Government, Media and Principal Public Libraries in the States and Territories. 3. From 28 October 1976. 4. Sale price $4.50 (book comprises 216 pages). Copies were readily available in all AGPS bookshops. 5. Print run for the second Fox Report was 12 000 copies. 6. 3550. 7. Same as (3) above 8. From 27 May 1977. 9. From 25 May 1977. 10. The sale price for the second Fox Report is $10.95 (book comprises 428 pages). A companion book 'Alligator Rivers Region Report' is concurrently available at $4.10, and a 10 per cent discount is offered if both reports are purchased together. The media reports referred to the price for both publications. {:#subdebate-87-49} #### Private Health Insurance: Government Subsidies (Question No. 900) {: #subdebate-87-49-s0 .speaker-SH4} ##### Dr Klugman: asked the Minister for Health, upon notice, on 25 May 1977: >What is the estimated cost for a full financial year of the Government subsidy for (a) private hospital accommodation and ( b) nursing home subsidies for persons who have elected to choose private health insurance. {: #subdebate-87-49-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -- The answer to the honourable member's question is as follows: {: type="a" start="a"} 0. $70m (estimate for 1976-77). 1. $6m. (This amount is an estimate of the Commonwealth ordinary and intensive care benefits payable in respect of patients accommodated in nursing homes approved under the National Health Act who have retained or taken out both medical and hospital insurance with private health insurance organisations since the changes to the Medibank arrangements which became effective from I October 1976. A figure for patients accommodated in nursing homes approved under the Nursing Homes Assistance Act is not available because the subsidy paid does not relate to the insurable status of the patients. ) {:#subdebate-87-50} #### Australian Medical Association Gazette: Allegations (Question No. 901) {: #subdebate-87-50-s0 .speaker-SH4} ##### Dr Klugman: asked the Minister for Health, upon notice, on 25 May 1977: {: type="1" start="1"} 0. 1 ) Has his attention been drawn to a claim in the Australian Medical Association Gazette of 12 May 1977 that (a) a solo general practitioner in a small New South Wales country town has provided screening services to 25 per cent of the adult population in a year, and (b) a general practitioner in another small country town has ordered full blood counts and pathology profiles in more than 1200 patient episodes. 1. If so, has he investigated these allegations; if so, what was the result. {: #subdebate-87-50-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) I am informed that the AMA Gazette of 12 May 1 977 contained a statement to this effect in a column headed 'So they say . . .' in the context that they were said to be individual and isolated instances. 1. No- without further information it is not possible to identify the particular general practitioners and to ascertain whether there had been any infringement of the Health Insurance Act. However, in this regard the Government has introduced a Bill to amend the Health Insurance Act, which will make accountable practitioners, who initiate pathology services, as to whether the services are reasonably necessary for the adequate medical care of their patients. This accountability will be to a group of their professional colleagues on a Medical Services Committee of Inquiry. Where the Committee finds that a practitioner has initiated excessive services it may recommend that the practitioner be reprimanded and/or the medical benefits paid for the services identified as excessive, will be re-paid by the practitioner either to the Commonwealth or the private health fund as appropriate. Public Servants Employed in Defence (Question No. 906) {: #subdebate-87-50-s2 .speaker-JVS} ##### Mr Neil: asked the Minister for Defence, upon notice, on 25 May 1977: {: type="1" start="1"} 0. 1 ) How many public servants in each of the First, Second and Third Divisions are employed in the (a) Defence Central Complex and (b) Department of Defence? 1. ) What is the total salary per division of public servants employed in the (a) Defence Central Complex and (b) Department of Defence? 2. What is the total (a) number in each rank and (b) salary per rank of Service officers in the Defence Central Complex? {: #subdebate-87-50-s3 .speaker-4U4} ##### Mr Killen:
LP -- The answer to the honourable member's question is as follows: >Figures shown in the following tables for employment in the Defence Central Complex comprise employment in all Departmental elements, wherever located, other than those directly controlled by the Service Chiefs of Staff. The figures include service and civilian personnel in overseas posts except those in Defence aid, co-operation or loan appointments > >I ) Number* of First, Second and Third Division Public Servants at 30 April 1 977 Employed in: The amount shown in the salary per rank column of the above table is the total annual salary for the number in each rank at salary rates which include the increases granted under the May 1977 National Wage Case. Service Allowance has been included in the salaries of officers of ranks Colonel and below. Officers above Colonel rank receive consolidated rates of pay. {:#subdebate-87-51} #### Brisbane City Council's Street Public Transport Undertaking (Question No. 918) {: #subdebate-87-51-s0 .speaker-HI4} ##### Mr Morris:
SHORTLAND, NEW SOUTH WALES asked the Minister representing the Minister for Administrative Services, upon notice, on 25 May 1977: {: type="1" start="1"} 0. 1 ) Did the Grants Commission take account of the loss incurred by the Brisbane City Council's street public transport undertaking in assessing Queensland's expenditure needs for 1974-75. 1. If so, was this the first occasion on which the Grants Commission has taken account of the loss incurred by the Brisbane City Council's street public transport undertaking in assessing Queensland 's expenditure needs. {: #subdebate-87-51-s1 .speaker-KVM} ##### Mr Street:
LP -- The Minister for Administrative Services has provided the following answer to the honourable member's question: {: type="1" start="1"} 0. Yes. 1. Yes. Queensland first applied for a special grant for the year 1971-72. Prior to 1974-75, however, the Commission did not have access to data which would have allowed it to take losses incurred by the Brisbane City Council's transport undertaking into account in assessing Queensland 's needs for metropolitan transport. {:#subdebate-87-52} #### Brisbane City Council's Street Public Transport Undertaking (Question No. 919) {: #subdebate-87-52-s0 .speaker-HI4} ##### Mr Morris: asked the Minister representing the Minister for Administrative Services, upon notice, on 25 May 1977: {: type="1" start="1"} 0. 1 ) Was the assessed special grant for Queensland for 1974-75 increased over what it would otherwise have been because the Brisbane City Council 's street public transport undertaking deficit in that year, modified for the relevant policy differences, was taken into account. 1. Was the amount of Queensland's assessed needs met from other Commonwealth grants for 1974-75 increased over what it would otherwise have been because the Brisbane City Council's street public transport undertaking deficit in that year, modified for the policy differences, was taken into account. {: #subdebate-87-52-s1 .speaker-KVM} ##### Mr Street:
LP -- The Minister for Administrative Services has provided the following answer to the honourable member's question: {: type="1" start="1"} 0. Yes. 1. ) No. The amount of Queensland 's assessed needs met from other Commonwealth grants was $113.6 million in respect of the year 1 974-75. This amount was not affected by the Commission's treatment of the losses incurred by the Brisbane City Council 's transport undertaking. {:#subdebate-87-53} #### Brisbane City Council's Street Public Transport Undertaking (Question No. 920) {: #subdebate-87-53-s0 .speaker-HI4} ##### Mr Morris: asked the Minister representing the Minister for Administrative Services, upon notice, on 25 May 1977: {: type="1" start="1"} 0. 1 ) By what amount was Queensland 's assessed special grant for 1974-75 increased on account of the Brisbane City Council's street public transport undertaking modified deficit being taken into account. 1. By what amount was Queensland 's assessed needs met from other Commonwealth grants for 1974-75 increased on account of the Brisbane City Council 's street public transport undertaking modified deficit being taken into account. {: #subdebate-87-53-s1 .speaker-KVM} ##### Mr Street:
LP -- The Minister for Administrative Services has provided the following answer to the honourable member's question: {: type="1" start="1"} 0. 1 ) $7,085,000. The special grant paid to Queensland for the year 1 974-75 was $24 million. The amount of this special grant would have been $16,915,000 had the losses on the Brisbane City Council 's transport undertaking for that year not been taken into account. It should be noted, however, that the Commission still assessed negative needs of 57,596,000 in respect of Queensland's metropolitan road transport for the year 1974-75. 1. 2 ) See answer to Question 919(2). Music Broadcasting Society of Queensland: FM Licence (Question No. 929) {: #subdebate-87-53-s2 .speaker-MH4} ##### Mr Jull: asked the Minister for Post and Telecommunications, upon notice, on 27 May 1977: {: type="1" start="1"} 0. 1 ) Has the Music Broadcasting Society of Queensland Ltd applied for a licence to operate an FM radio station in Brisbane. 1. ) If so, on which date was the application received. 2. 3 ) Has he decided whether he will grant this licence. 3. If so, when will the licence be announced, and from which date will it operate. 4. 5 ) Has this group conducted test broadcasts in Brisbane. 5. If so, on which dates were these broadcasts made and for what duration. {: #subdebate-87-53-s3 .speaker-KZL} ##### Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP -- The answers to the honourable member's questions are as follows: {: type="1" start="1"} 0. 1 ) No. The Music Broadcasting Society of Queensland Ltd has indicated its interest in an FM licence. 1. The initial indication of interest was dated 20 September 1976. 2. No. 3. See (3)above. 4. Yes. 5. Test broadcasts have been conducted as follows: {: type="a" start="a"} 0. Between noon 27 August and 8.00 p.m. 29 August 1976 excluding the hours between 10.00 p.m. and 10.00 a.m. 1. Between 6.00 p.m. 22 October and midnight 24 October 1976, 6.00 p.m. 22 April and midnight 25 April 1977 and 6.00 p.m. 29 April and midnight 2 May 1977, excluding the hours between midnight and 8.00 a.m. {:#subdebate-87-54} #### Commonwealth Car Drivers (Question No. 930) {: #subdebate-87-54-s0 .speaker-HI4} ##### Mr Morris: asked the Minister representing the Minister for Administrative Services, upon notice, on 26 May 1977: {: type="1" start="1"} 0. Are Commonwealth car drivers required to have regular medical checks; if so, what is the nature and frequency of the checks. 1. Are Commonwealth car drivers required to have security clearances; if so, what is the nature and frequency of these security clearances. {: #subdebate-87-54-s1 .speaker-KVM} ##### Mr Street:
LP -- The Minister for Administrative Services has provided the following answer to the honourable member's question: {: type="A" start="1"} 0. I ) Yes. The frequency of the examination is: {: type="a" start="a"} 0. Up to 45 years of age- every 5 years 1. 45-55 years of age- every 4 years 2. Over 55 years of age- every 2 years. The examinations include tests on colour vision, visual acuity, hearing, blood pressure, respiration, heart pulsations and other physical conditions. {: type="1" start="2"} 0. ) Yes. Commonwealth car drivers are subject to security checking upon commencement of employment. {:#subdebate-87-55} #### Securities Industry Legislation (Question No. 946) {: #subdebate-87-55-s0 .speaker-CV4} ##### Mr Jacobi: asked the Minister for Business and Consumer Affairs, upon notice, on 27 May 1977: {: type="1" start="1"} 0. 1 ) In his report on the collapse of the Patrick Partners broking empire, did **Mr Masterman,** Q.C., recommend the following changes to the securities industry legislation: (a) that an effective liquid capital requirement be imposed by the legislation on stockbrokers, (b) that regular returns of financial affairs be lodged by brokers with the regulatory authority to enable it to monitor compliance with the liquid capital requirements, (c) that the liquid capital requirements take account of the fluctuating value of certain assets and recognise the dangers of undue concentration of assets in particular shares, (d) that unsecured loans, particularly to associated companies, should be excluded from calculation of a broker's liquid capital, (e) that temporary infusions of capital into a broker's business close to balance date should be precluded, (f) that if the Stock Exchanges are to play a role in policing the liquid capital requirements, there should be an express right of civil action for persons injured by an exchange's failure to meet its obligations in this regard, (g) that stockbrokers should regularly inform clients of the broker's financial position, (h) that mixing of securities of different clients be prohibited without the express written approval of each client and (i) that stricter trust account requirements be implemented. 1. ) If so, can he provide information on (a) action that has been taken to give effect to each of these recommendations and (b) whether the proposed co-operative companies and securities legislation will contain provisions designed to implement **Mr Masterman** 's suggestions. {: #subdebate-87-55-s1 .speaker-ZD4} ##### Mr Howard:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. Yes. 1. The Commonwealth Government is continuing its discussions with the States on the proposed co-operative Commonwealth/State scheme for legislation and administration in the fields of company law and the regulation of the securities industry. It would be inappropriate to disclose particulars of those discussions at this stage. {:#subdebate-87-56} #### Companies and Securities Regulation (Question No. 947) {: #subdebate-87-56-s0 .speaker-CV4} ##### Mr Jacobi: asked the Minister for Business and Consumer Affairs, upon notice, on 27 May 1977: {: type="1" start="1"} 0. 1 ) Has any agreement been reached between the Commonwealth and the States in the field of companies and securities regulation which resolves the problem of the position of the proposed Ministerial Council in relation to amendments to the initial co-operative legislation; if so, what has been agreed between the parties. 1. Is it desirable for the regulatory framework in the corporate and securities area to be flexible and up-to-date in order to meet ever-changing circumstances. 2. If complete unanimity in the Ministerial Council was necessary regarding proposed amendments, would this institute a severe obstacle to necessary and speedy reform of deficiencies in the existing law. 3. If the answers to parts (2) and (3) are in the affirmative, can he give an assurance that the Commonwealth will insist on the principle that decisions of the Ministerial Council are taken by a majority; if not, why not. {: #subdebate-87-56-s1 .speaker-ZD4} ##### Mr Howard:
LP -The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) to (4) The Commonwealth Government is continuing its discussions with the States on the proposed co-operative Commonwealth/State scheme for legislation and administration in the fields of company law and the regulation of the securities industry. It would be inappropriate to disclose particulars of those discussions at this stage. {:#subdebate-87-57} #### Broadcast of Anzac Day Parade (Question No. 954) {: #subdebate-87-57-s0 .speaker-K9M} ##### Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP asked the Minister for Post and Telecommunications, upon notice, on 27 May 1977: >Was the omission, during the Australian Broadcasting Commission broadcast of the Anzac Day parade in Sydney on 25 April 1977, to name clearly the group of men and women representing Australian soldiers, who were isolated and cared for by Timorese citizens in World War II an accidental omission or a result of a direction to comply with the present Government 's decision to ignore the Timorese. {: #subdebate-87-57-s1 .speaker-KZL} ##### Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP -- The answer to the honourable member's question is as follows: >The ABC found no mention of the group in its research, conducted in collaboration with the organisers, prior to the Anzac Day Parade, nor was such a group officially identified in the Parade itself. The ABC did not receive any direction in this matter. Postal Charges on Naval Ships (Question No. 959) {: #subdebate-87-57-s2 .speaker-JM9} ##### Mr Armitage: asked the Minister for Defence, upon notice, on 30 May 1977: >Have personnel on Naval ships travelling overseas had their postal charges increased to 45c; if so, what is the reason. {: #subdebate-87-57-s3 .speaker-4U4} ##### Mr Killen:
LP -- The answer to the honourable member's question is as follows: >Naval personnel on ships travelling overseas are subject to normal Australia Post/International postal rates for the respective postal zones in which the ships are deployed. There have been no increases in Australian postal rates since 1 September 1975. Exceptions are naval personnel on ships attached to the Five Power Force in Malaysia and Singapore who are eligible for concessional rates of postage. Also under a reciprocal arrangement with the U.K. Government Australian naval personnel on duty in the U.K. are allowed concessional rates of postage on mail. {:#subdebate-87-58} #### Saturday Postal Services (Question No. 969) {: #subdebate-87-58-s0 .speaker-JVS} ##### Mr Neil: asked the Minister for Post and Telecommunications, upon notice, on 30 May 1977: {: type="1" start="1"} 0. 1 ) What is the reason for post offices remaining closed on Saturday mornings. 1. What action is the Government taking to restore Saturday morning services. 2. Which post offices or sub-post offices in the Electoral Division of St George are open on Saturdays and during which hours. {: #subdebate-87-58-s1 .speaker-KZL} ##### Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. Prior to 1974 a significant number of official offices had been closed on Saturdays and the Saturday trading hours of others had been reduced in accordance with a lower level of customer demand. Closure of all official post offices on Saturdays resulted from direct action in 1974 by certain staff organisations which instructed their members (including counter staff) not to attend for overtime duty on Saturdays. Until that time, counter staff completed their weekly hours over the five days, Monday to Friday, and were rostered on overtime in order to provide counter services on Saturdays. Negotiations with staff organisations to re-open some official post offices on Saturday mornings were not successful. Studies showed that it was not practicable to provide counter services on Saturdays under any acceptable rostering arrangement whereby the Saturday duty could be regarded as normal duty with time off in lieu during the week. Additionally, cost benefit analyses have been made on the re-opening on Saturday mornings of those official post offices which, prior to 1974, did provide a Saturday service. On the basis of providing a counter service only, costs (at current prices) would be to the order of $4.8 million a year. At many of the offices, the costs involved would not be justified by the service demand, and overall, it is most unlikely that any significant additional revenue would be earned. {: type="1" start="2"} 0. Recent surveys have indicated low demand for Saturday counter services at many non-official post offices that do provide services on Saturdays. Based on these surveys and for the economic reasons given in (1), the reintroduction of services at official post offices on Saturdays is unlikely. Postal services continue to be provided at those non-official post offices where there is a reasonably high demand for counter services on Saturdays. 1. 3 ) The following non-official post offices in the St George Electorate are open on Saturdays and provide a counter service from 9 a.m. to 1 1 a.m.: Banksia; Bardwell Park; Bexley North; Bexley South; Carlton; Clemton Park; Earlwood West; Kingsway West. {:#subdebate-87-59} #### Suitability and Performance of Commonwealth Vehicles (Question No. 977) {: #subdebate-87-59-s0 .speaker-5J4} ##### Mr Scholes: asked the Minister representing the Minister for Administrative Services, upon notice, on 30 May 1977: {: type="1" start="1"} 0. 1 ) Are Commonwealth employees who regularly drive cars, buses or other vehicles, consulted regularly in relation to the suitability and performance of vehicles purchased by the Commonwealth which they drive or operate. 1. If not, will the Minister examine the possibility of requesting drivers to supply a statement of suitability and performance at regular intervals. 2. Will the Minister consult with his Department, unions, vehicle manufacturers and automobile organisations to establish what information could be useful as a result of these surveys of drivers. {: #subdebate-87-59-s1 .speaker-KVM} ##### Mr Street:
LP -- The Minister for Administrative Services has provided the following answer to the honourable member's question. {: type="1" start="1"} 0. 1 ) Yes. Discussions are held on an informal basis with individual drivers or formally with union representatives. 1. ) See answer to ( 1 ) above. 2. My Department consults with unions and vehicle manufacturers and at times with automobile organisations regarding suitablity and performance of vehicles, including drivers' views on these matters. Inclusions in New Zealand-Australia Free Trade Agreement (Question No. 982) {: #subdebate-87-59-s2 .speaker-2E4} ##### Mr Lloyd: asked the Minister for Overseas Trade, upon notice, on 30 May 1977: {: type="1" start="1"} 0. 1 ) What procedures are adopted by his Department to determine whether or not an industry will be affected by the inclusion of a commodity in Schedule A of NAFTA. 1. Is the industry organisation always contacted; if not, why not. 2. If so, was the Australian Mushroom Growers' Association contacted prior to New Zealand being notified that there were no Australian objections to fresh mushrooms being included in Schedule A; if not, why not. {: #subdebate-87-59-s3 .speaker-BU4} ##### Mr Anthony:
NCP/NP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) Nominations for the addition of goods to Schedule A of NAFTA are received and exchanged by both Governments on a regular basis. In Australia the Department of Overseas Trade is primarily responsible for the preliminary examination of such nominations, in close consultation with the Department of Industry and Commerce and Primary Industry depending on the nature of the goods under consideration. Acting on the advice of the relevant Department that, on a prima facie basis, inclusion of the goods in Schedule A would not be detrimental to the particular local industry, and provided the nomination is acceptable to the New Zealand Government, the proposal is widely advertised in both countries. In Australia an advertisement giving notice of nominations under consideration is placed in all the major daily newspapers and a considerable number of industry associations, lobby groups and interested individuals receive a circularised notification of the proposals. Interested parties have a period of 60 days within which they may comment either in support of or in opposition to the nominations. In the event that objections to particular nominations are substantiated, by reference to the Industries Assistance Commission, if necessary, the goods are not added to the Schedule. 1. As outlined above considerable efforts are made by several Government Departments to acquaint interested parties with proposals for the addition of goods to Schedule A of NAFTA. The procedures currently followed have been in operation since the Free Trade Agreement came into effect in 1966 and the method of notification of proposals is consistent with that normally adopted in similar circumstances by other Government Departments and agencies. While the Departments concerned endeavour to directly contact known industry organisations, it is not always possible to ensure that every interested party is consulted in this way. However, all nominations are subject to public scrutiny for two months and it is considered this provides ample opportunity for comment. 2. In view of the fact that mushrooms are already traded duty free between Australia and New Zealand, it was not expected that inclusion of the goods in Schedule A would be detrimental to the local industry. The proposal to include fresh mushrooms in Schedule A of NAFTA was publicly notified on 17 March 1977. Subsequently, the Secretary of the Australian Mushroom Growers' Association has had frequent contact with officers of the Department of Overseas Trade and, as a result of these discussions, the inclusion of fresh mushrooms in Schedule A has been deferred. In accordance with normal procedure it is proposed that a reference will be made to the Industries Assistance Commission for enquiry and report as to whether the inclusion in Schedule A of these goods would be detrimental to the Australian industry. {:#subdebate-87-60} #### Petrol Consumption of Motor Vehicles (Question No. 987) {: #subdebate-87-60-s0 .speaker-CV4} ##### Mr Jacobi: asked the Minister for National Resources, upon notice, on 3 1 May 1977: {: type="1" start="1"} 0. 1 ) Has he studied the United States legislation which sets standards for the petrol consumption of motor vehicles. 1. Has this matter and other recent U.S. initiatives been considered by the interdepartmental committee which is studying the reports of the Royal Commission on Petroleum. 2. If so, has the Australian motor vehicle industry been consulted about any technical and economic problems which might arise from possible petrol conservation measures. {: #subdebate-87-60-s1 .speaker-BU4} ##### Mr Anthony:
NCP/NP -- The following is the answer to the honourable member's question: {: type="1" start="1"} 0. Departmental officers have examined the United States legislation. 1. The Royal Commission on Petroleum did not specifically give attention to the American legislation and this matter was therefore not covered by the relevant interdepartmental committee. 2. Energy conservation measures are being actively examined by the National Energy Advisory Committee. Approaches have been made to the Australian motor vehicle industry and further consultations are scheduled to take place in the near future. {:#subdebate-87-61} #### Employment of School Leavers (Question No. 998) {: #subdebate-87-61-s0 .speaker-KDV} ##### Mr Charles Jones: asked the Minister for Employment and Industrial Relations, upon notice, on 31 May 1977: >How many school leavers have been placed in permanent employment by the Commonwealth Employment Offices at (a) Newcastle, (b) Charlestown, (c) Maitland and (d) Cessnock since 30 November 1976. {: #subdebate-87-61-s1 .speaker-KVM} ##### Mr Street:
LP -- The answer to the honourable member's question is as follows: >The numbers of school-leaver, full-time placements confirmed by the Commonwealth Employment Service in the offices concerned from end-November 1976 until end-May 1977 were (a) Newcastle, 304, (b) Charlestown, 125, (c) Maitland, 91 and (d) Cessnock, 68. Overseas Travel by Departmental Staff (Question No. 1004) {: #subdebate-87-61-s2 .speaker-HI4} ##### Mr Morris: asked the Minister for National Resources, upon notice, on 1 June 1977: {: type="1" start="1"} 0. 1 ) What is the name and classification of each officer of his Department who travelled overseas or is scheduled to travel overseas during the periods (a) 1 1 November 1975 to 30 June 1976 and (b) I July 1976 to 30 June 1977 on duties associated with (i) overseas visits by the Prime Minister, (ii) overseas visits by him, (iii) overseas visits by any other Ministers and (iv) overseas visits for any other purpose. 1. What charges were made against his Department's estimates in respect of each of those officers under the categories listed in part ( 1) by way of (a) cost of travel, (b) cost of accommodation and (c) other costs. 2. What amounts were recovered or are to be recovered from other departments in respect of those officers, and in respect of what activities by those officers on behalf of other departments were the amounts recovered or are expected to be recovered. 3. Were funds set aside in the Department's estimates in each of the relevant periods for expenditure of this nature; if so, what were the amounts provided and what were the division and sub-division numbers. 4. If funds were not set aside in the Department's estimates, from what source were the expenditures paid showing division and sub-division numbers. 5. From whom were the requests for duties to be carried out on behalf of other departments, including the Prime Minister's Department, received and when. {: #subdebate-87-61-s3 .speaker-BU4} ##### Mr Anthony:
NCP/NP -The answer to the honourable member's question is as follows: {: type="A" start="I"} 0. to (6) See the answer to House of Representatives question No. 1003 (Weekly *Hansard* for 2 June 1977, page 2531). Overseas Travel by Departmental Staff (Question No. 1005) {: #subdebate-87-61-s4 .speaker-HI4} ##### Mr Morris: asked the Minister for Overseas Trade, upon notice, on 1 June 1 977: {: type="1" start="1"} 0. 1 ) What is the name and classification of each officer of his Department who travelled overseas or is scheduled to travel overseas during the periods (a) 1 1 November 1975 to 30 June 1976 and (b) 1 July 1976 to 30 June 1977 on duties associated with (i) overseas visits by the Prime Minister, (ii) overseas visits by him, (iii) overseas visits by any other Ministers and (iv) overseas visits for any other purpose. 1. What charges were made against his Department's estimates in respect of each of those officers under the categories listed in part ( 1 ) by way of ( a ) cost of travel, ( b ) cost of accommodation and (c) other costs. 2. What amounts were recovered or are to be recovered from other departments in respect of those officers, and in respect of what activities by those officers on behalf of other departments were the amounts recovered or are expected to be recovered. 3. Were funds set aside in the Department's estimates in each of the relevant periods for expenditure of this nature; if so, what were the amounts provided and what were the division and sub-division numbers. 4. If funds were not set aside in the Department's estimates, from what source were the expenditures paid showing division and sub-division numbers. 5. From whom were the requests for duties to be carried out on behalf of other departments, including the Prime Minister's Department, received and when. {: #subdebate-87-61-s5 .speaker-BU4} ##### Mr Anthony:
NCP/NP -- The answer to the honourable member's question is as follows: {: type="A" start="I"} 0. to (6) I refer the honourable member to the reply which I gave as Acting Prime Minister in answer to Question No. 1003. Overseas Travel by Departmental Staff (Question No. 1009) {: #subdebate-87-61-s6 .speaker-HI4} ##### Mr Morris: asked the Minister representing the Minister for Industry and Commerce, upon notice, on 1 June 1977: {: type="1" start="1"} 0. 1 ) What is the name and classification of each officer of the Department of Industry and Commerce who travelled overseas or is scheduled to travel overseas during the periods (a) 1 1 November 1975 to 30 June 1976 and (b) I July 1976 to 30 June 1977 on duties associated with (i) overseas visits by the Prime Minister, (ii) overseas visits by the Minister, (iii) overseas visits by any other Ministers and (iv) overseas visits for any other purpose. 1. What charges were made against the estimates for the Department of Industry and Commerce in respect of each of those officers under the categories listed in part ( I ) by of (a) cost of travel, ( b ) cost of accommodation and (c) other costs. 2. What amounts were recovered or are to be recovered from other departments in respect of those officers, and in respect of what activities by those officers on behalf of other departments were the amounts recovered or are expected to be recovered. 3. Were funds set aside in the Department's estimates in each of the relevant periods for expenditure of this nature; if so, what were the amounts provided and what were the division and sub-division numbers. 4. If funds were not set aside in the Department's estimates, from what source were the expenditures paid showing division and sub-division numbers. 5. From whom were the requests for duties to be carried out on behalf of other departments, including the Prime Minister's Department, received and when. {: #subdebate-87-61-s7 .speaker-ZD4} ##### Mr Howard:
LP -- The Minister for Industry and Commerce has provided the following answer to the honourable member's question: . I refer the honourable member to the answer to Question No. 1003. Overseas Travel by Departmental Staff (Question No. 1012) {: #subdebate-87-61-s8 .speaker-HI4} ##### Mr Morris: asked the Minister representing the Minister for Education, upon notice, on 1 June 1977: {: type="1" start="1"} 0. 1 ) What is the name and classification of each officer of the Department of Education who travelled overseas or is scheduled to travel overseas during the periods (a) 1 1 November 1975 to 30 June 1976, and (b) 1 July 1976 to 30 June 1977 on duties associated with (i) overseas visits by the Prime Minister, (ii) overseas visits by the Minister, (iii) overseas visits by any other Ministers and 'iv) overseas visits for any other purpose. 1. What charges were made against *'*<* estimates for the Department of Education in respect ' ' ~'.i of those officers under the categories listed in part . ' '.)' way of (a) cost of travel, (b) cost of accommodation and (c) other costs. 2. What amounts were recovered or are to be recovered from other departments in respect of those officers, and in respect of what activities by those officers on behalf of other departments were the amounts recovered or are expected to be recovered. 3. Were funds set aside in the Department's estimates in each of the relevant periods for expenditure of this nature; if so, what were the amounts provided and what were the division and sub-division numbers. 4. If funds were not set aside in the Department's estimates, from what source were the expenditures paid showing division and sub-division numbers. 5. From whom were the requests for duties to be carried out on behalf of other departments, including the Prime Minister's Department, received and when. {: #subdebate-87-61-s9 .speaker-EE6} ##### Mr Viner:
LP -- The Minister for Education has provided the following reply to the honourable member's question: {: type="A" start="1"} 0. I ) to (6) I draw the honourable member's attention to the Prime Minister's reply to Question No. 1003. Overseas Travel by Departmental Staff (Question No. 1014) {: #subdebate-87-61-s10 .speaker-HI4} ##### Mr Morris: asked the Minister for Defence, upon notice, on 1 June 1977: {: type="1" start="1"} 0. 1 ) What is the name and classification of each officer of his Department who travelled overseas or is scheduled to travel overseas during the periods (a) 1 1 November I97S to 30 June 1976 and (b) I July 1976 to 30 June 1977 on duties associated with (i) overseas visits by the Prime Minister, (ii) overseas visits by him, (iii) overseas visits by any other Ministers and (iv) overseas visits for any other purpose. 1. What charges were made against his Department's estimates in respect or each of those officers under the categories listed in part ( I ) by way of (a) cost of travel, (b) cost of accommodation and (c) other costs. 2. What amounts were recovered or are to be recovered from other departments in respect of those officers, and in respect of what activities by those officers on behalf of other departments were the amounts recovered or are expected to be recovered. 3. Were funds set aside in the Department's estimates in each of the relevant periods for expenditure of this nature: if so, what were the amounts provided and what were the division and sub-division numbers. 4. If funds were not set aside in the Department's estimates, from what source were the expenditures paid showing division and sub-division numbers. 5. From whom were the requests for duties to be carried out on behalf of other departments, including the Prime Minister's Department, received and when. {: #subdebate-87-61-s11 .speaker-4U4} ##### Mr Killen:
LP -- The answer to the honourable member's question is as follows: {: type="A" start="I"} 0. to (6) I refer the honourable member to the Prime Minister's reply to Question No. 1003, Weekly *Hansard* of 2 June 1977. Overseas Travel by Departmental Staff (Question No. 1015) {: #subdebate-87-61-s12 .speaker-HI4} ##### Mr Morris: asked the Minister representing the Minister for Social Security, upon notice, on 1 June 1977: {: type="1" start="1"} 0. 1 ) What is the name and classification of each officer of the Department of Social Security who travelled overseas or is scheduled to travel overseas during the periods (a) II November 1975 to 30 June 1976 and (b) I July 1976 to 30 June 1977 on duties associated with (i) overseas visits by the Prime Minister, (ii) overseas visits by the Minister, (iii) overseas visits by any other Ministers and (iv) overseas visits for any other purpose. 1. What charges were made against the estimates for the Department of Social Security in respect of each of those officers under the categories listed in pan ( I ) by way of (a) cost of travel. ( b) cost of accommodation and (c) other costs. 2. What amounts were recovered or are to be recovered from other departments in respect of those officers, and in respect of what activities by those officers on behalf of other departments were the amounts recovered or are expected to be recovered. 3. 4 ) Were funds set aside in the Department 's estimates in each of the relevant periods for expenditure of this nature; if so, what were the amounts provided and what were the division and sub-division numbers. 4. If funds were not set aside in the Department's estimates, from what source were the expenditures paid showing division and sub-division numbers. 5. From whom were the requests for duties to be carried out on behalf of other departments. including the Prime Minister's Department, received and when. {: #subdebate-87-61-s13 .speaker-GH4} ##### Mr Hunt:
NCP/NP -- The Minister for Social Security has provided the following answer to the honourable member's question: >I refer the honourable member to the answer provided by the Acting Prime Minister to Question No. 1003. Overseas Travel by Departmental Staff (Question No. 1016) {: #subdebate-87-61-s14 .speaker-HI4} ##### Mr Morris: asked the Attorney-General, upon notice, on 1 June 1977: {: type="1" start="1"} 0. 1 ) What is the name and classification of each officer of his Department who travelled overseas or is scheduled to travel overseas during the periods (a) 1 1 November 1975 to 30 June 1976 and (b) I July 1976 to 30 June 1977 on duties associated with (i) overseas visits by the Prime Minister, (ii) overseas visits by him, (iii) overseas visits by any other Ministers and ( iv ) overseas visits for any other purpose. 1. What charges were made against his Department's estimates in respect of each of those officers under the categories listed in pan ( I ) by way of (a) cost of travel, (b) cost of accommodation and (c) other costs. 2. What amounts were recovered or are to be recovered from other departments in respect of those officers, and in respect of what activities by those officers on behalf of other departments were the amounts recovered or are expected to be recovered. 3. Were funds set aside in the Department's estimates in each of the relevant periods for expenditure of this nature; if so, what were the amounts provided and what were the division and sub-division numbers. 4. If funds were not set aside in the Department's estimates, from what source were the expenditures paid showing division and sub-division numbers. 5. From whom were the requests for duties to be carried out on behalf of other departments, including the Prime Minister's Department, received and when. {: #subdebate-87-61-s15 .speaker-YF6} ##### Mr Ellicott:
LP -The answer to the honourable member's question is as follows: >I refer the honourable member to the answer to question No. 1003. Overseas Travel by Departmental Staff (Question No. 1017) {: #subdebate-87-61-s16 .speaker-HI4} ##### Mr Morris: asked the Minister for Business and Consumer Affairs, upon notice, on 1 June 1977: {: type="A" start="1"} 0. I ) What is the name and classification of each officer of his Department who travelled overseas or is scheduled to travel overseas during the periods (a) 1 1 November 1975 to 30 June 1976 and (b) I July 1976 to 30 June 1977 on duties associated with (i) overseas visits by the Prime Minister, (ii) overseas visits by him, (iii) overseas visits by any other Ministers and (iv) overseas visits For any other purpose. {: type="1" start="2"} 0. What charges were made against his Department's estimates in respect of each of those officers under the categories listed in part ( I ) by way of (a) cost of travel, (b) cost of accommodation and (c) other costs. 1. What amounts were recovered or are to be recovered from other departments in respect of those officers, and in respect of what activities by those officers on behalf of other departments were the amounts recovered or are expected to be recovered. 2. Were funds set aside in the Department's estimates in each of the relevant periods for expenditure of this nature; if so, what were the amounts provided and what were the division and sub-division numbers. 3. If funds were not set aside in the Department's estimates, from what source were the expenditures paid showing division and sub-division numbers. 4. From whom were the requests for duties to be carried out on behalf of other departments, including the Prime Minister's Department, received and when. {: #subdebate-87-61-s17 .speaker-CG4} ##### Mr Fife:
LP -- The answer to the honourable member's question is as follows: {: type="A" start="1"} 0. I ) to (6) I refer the honourable member to the answer to Question No. 1003. Overseas Travel by Departmental Staff (Question No. 1018) {: #subdebate-87-61-s18 .speaker-HI4} ##### Mr Morris: asked the Minister for Health, upon notice, on 1 June 1 977: {: type="1" start="1"} 0. 1 ) What is the name and classification of each officer of his Department who travelled overseas or is scheduled to travel overseas during the periods (a) 1 1 November 197S to 30 June 1976 and (b) I July 1976 to 30 June 1977 on duties associated with (i) overseas visits by the Prime Minister, (ii) overseas visits by him, (iii) overseas visits by any other Ministers and (iv) overseas visits for any other purpose. 1. What charges were made against his Department's estimates in respect of each of those officers under the categories listed in part (1) by way of (a) cost of travel, (b) cost of accommodation and (c) other costs. 2. What amounts were recovered or are to be recovered from other departments in respect of those officers, and in respect of what activities by those officers on behalf of other departments were the amounts recovered or are expected to be recovered. 3. Were funds set aside in the Department's estimates in each of the relevant periods for expenditure of this nature; if so, what were the amounts provided and what were the division and sub-division numbers. 4. If funds were not set aside in the Department's estimates, from what source were the expenditures paid showing division and sub-division numbers. 5. From whom were the requests for duties to be carried out on behalf of other departments, including the Prime Minister's Department, received and when. {: #subdebate-87-61-s19 .speaker-GH4} ##### Mr Hunt:
NCP/NP -The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) to (6) I refer the honourable member to the answer provided by the Acting Prime Minister to Question No. 1003 *(Hansard,* 2 June 1977, page 2531). Overseas Travel by Departmental Staff (Question No. 1019) **Mr Morris** asked the Minister for Immigration and Ethnic Affairs, upon notice, on 1 June 1977: {: type="1" start="1"} 0. 1 ) What is the name and classification of each officer of his Department who travelled overseas or is scheduled to travel overseas during the periods (a) 1 1 November 1975 to 30 June 1976 and (b) I July 1976 to 30 June 1977 on duties associated with (i) overseas visits by the Prime Minister, (ii) overseas visits by him, (iii) overseas visits by any other Ministers and (iv) overseas visits for any other purpose. 1. ) What charges were made against his Department's estimates in respect of each of those officers under the categories listed in part ( I ) by way of (a) cost of travel, (b) cost of accommodation and (c) other costs. 2. What amounts were recovered or are to be recovered from other departments in respect of those officers, and in respect of what activities by those officers on behalf of other departments were the amounts recovered or are expected to be recovered. 3. Were funds set aside in the Department's estimates in each of the relevant periods for expenditure of this nature; if so, what were the amounts provided and what were the division and sub-division numbers. 4. If funds were not set aside in the Department's estimates, from what source were the expenditures paid showing division and sub-division numbers. 5. From whom were the requests for duties to be carried out on behalf of other departments, including the Prime Minister' Department, received and when. {: #subdebate-87-61-s20 .speaker-0I4} ##### Mr MacKellar:
LP -- The answer to the honourable member's question is as follows:. {: type="1" start="1"} 0. 1 ) to (6) The information is not maintained in the form sought by the honourable member. To obtain it would require considerable effort and man-hours, which I am not prepared to authorise. If the honourable member wishes to have information in respect of some specific issue, however, I shall examine his request to see if this can be provided. Overseas Travel by Departmental Staff (Question No. 1026) {: #subdebate-87-61-s21 .speaker-HI4} ##### Mr Morris: asked the Minister for the Capital Territory, upon notice, on I June 1977: {: type="1" start="1"} 0. 1 ) What is the name and classification of each officer of his Department who travelled overseas or is scheduled to travel overseas during the period (a) 1 1 November 1975 to 30 June 1976 and (b) 1 July 1976 to 30 June 1977 on dudes associated with (i) overseas visits by the Prime Minister, (ii) overseas visits by him, (iii) overseas visits by any other Ministers and (iv) overseas visits for any other purpose. 1. What charges were made against his Department's estimates in respect of each of those officers under the categories listed in part ( I ) by way of (a) cost of travel, (b) cost of accommodation and ( c) other costs. 2. What amounts were recovered or are to be recovered from other departments in respect of those officers, and in respect of what activities by those officers on behalf of other departments were the amounts recovered or are expected to be recovered. 3. Were funds set aside in the Department's estimates in each of the relevant periods for expenditure of this nature; if so, what were the amounts provided and what were the division and sub-division numbers. 4. If funds were not set aside in the Department's estimates, from what source were the expenditures paid showing division and sub-division numbers. 5. From whom were the requests for duties to be carried out on behalf of other departments, including the Prime Minister's Department, received and when. {: #subdebate-87-61-s22 .speaker-GY5} ##### Mr Staley:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. to (6) I refer the honourable member to the Prime Minister's reply to Question on Notice No. 1003. {:#subdebate-87-62} #### Frequency Warrants (Question No. 1031) {: #subdebate-87-62-s0 .speaker-MH4} ##### Mr Jull: asked the Minister for Post and Telecommunications, upon notice, on 1 June 1977: {: type="1" start="1"} 0. 1 ) Does he intend to issue frequency warrants to operators of television and radio stations in Australia; if so, for what purpose. 1. Does he intend to follow the course outlined in the Green Report at pages A 130 to A 1 32 in this regard; if not, what procedures will be adopted. 2. Will frequency warrants automatically be granted to every holder of a broadcasting licence, following the granting of a licence by the Australian Broadcasting Tribunal. 3. Will the same conditions apply for renewal of licences. 4. Will the Australian Broadcasting Commission stations also be granted a frequency warrant; if not, why not. 5. Under what circumstances would a warrant be withdrawn from an operator. 6. Would frequency drift be considered just grounds to revoke a warrant; if so, would the ABC also be subjected to this provision; if not, why not. 7. What action would be taken prior to his final decision to revoke a frequency warrant. 8. After 30 years of broadcasting in Australia, why, in 1 977, does he consider it necessary to institute such a system. 9. Under the system of frequency warrants, will a broadcasting licence holder be unable to operate a radio or television station should his warrant be withdrawn; if so, will it be primarily the listening or viewing public who will suffer from the blackout of a radio or television station. 10. Can he say whether in the United States of America the Federal Communications Commission imposes fines on operators who breach broadcasting regulations. 11. 1 2 ) If so, has this system been considered for Australia; if not, why not. 12. Would this system be more advantageous for the Australian listener or viewer, rather than a complete withdrawal of a licence. 13. 14) Is he prepared to reconsider the whole matter of frequency warrants in the interest of the radio listeners and television viewers of Australia. {: #subdebate-87-62-s1 .speaker-KZL} ##### Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) Yes. Frequency warrants will be issued as part of the process of allocating frequencies for broadcasting services. 1. Yes. 2. Yes. 3. Yes. 4. Yes. 5. In cases of gross and/or repeated instances of technical malpractice- particularly matters affecting other services such as the use of an incorrect operating frequency, excessive spurious radiations, excessive power and so on. 6. Yes. If the drift was so excessive as to cause harmful interference to another service, and if reasonable steps had not been taken to correct the drift. These provisions would apply to all users. 7. A suitable warning would be given to remedy the technical problem concerned. This warning would also give notice of intention to withdraw the frequency warrant if no corrective action was taken within a reasonable time period as specified. 8. Under the revised broadcasting system a number of powers previously held by the Minister and the former Australian Broadcasting Control Board become the responsibility of the Australian Broadcasting Tribunal. However, the management of the radio frequency spectrum with its international obligations must remain a Government responsibility, and will now be separately discharged through the issue of frequency warrants. 9. 10) Yes. However since a frequency warrant would only be withdrawn in cases of gross technical malpractice, any action taken in this regard would be very much in the public interest. 10. 1 1 ) No detailed study has been made of this matter see (12). 11. A system of fines has not been considered for Australia as such a system is felt to be totally inappropriate as a means of rectifying major breaches of technical standards which are causing substantial interference. Breaches of this nature require correction, rather than a penalty by way of a fine. 12. See(l2). 13. 1 4 ) As one of the basic aims of the frequency warrant system is to protect the interests of radio listeners and television viewers in Australia, there would appear to be no necessity to review the system at this stage. {:#subdebate-87-63} #### Establishment of Broadcasting Council (Question No. 1032) {: #subdebate-87-63-s0 .speaker-MH4} ##### Mr Jull: asked the Minister for Post and Telecommunications, upon notice, on 1 June 1977: {: type="1" start="1"} 0. 1 ) Is it still the intention of the Government to establish a Broadcasting Council; if so, when. 1. What will be the composition of the Council and its functions when it is established. 2. To what degree will the Council be involved in the future planning of the broadcasting industry in Australia. {: #subdebate-87-63-s1 .speaker-KZL} ##### Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) It has now been decided to defer the establishment of a Broadcasting Council until the Government has had the opportunity to consider the report and recommendations of the Australian Broadcasting Tribunal following completion of its inquiry into broadcasting standards and the concept of self-regulation. As the proposals included in the Green Report for the formation of a Broadcasting Council envisaged a significant role for such a Council into matters of programming and advertising standards, as well as broadcasting planning, it has been considered desirable that there should be a clearer understanding of the manner in which matters of regulation within the industry is likely to be administered in the future before a Council of this nature is finally established. 1. ) The composition of the Council, and its functions, will be reviewed in association with the points raised in ( I ). 2. See(2). {:#subdebate-87-64} #### Plant Diseases and Insect Pests (Question No. 1046) {: #subdebate-87-64-s0 .speaker-JT9} ##### Mr Bungey:
CANNING, WESTERN AUSTRALIA asked the Minister for Health, upon notice, on 2 June 1 977: >What procedures have been determined to ensure that (a) potatoes, (b) avocados and (c) cut flowers imported into Australia are free of plant diseases and insect pests. {: #subdebate-87-64-s1 .speaker-GH4} ##### Mr Hunt:
NCP/NP -The answer to the honourable member's question is as follows: {: type="a" start="a"} 0. The importation of commercial quantities of potatoes for sowing is prohibited; small samples of new varieties may be imported by official bodies only. These samples are subject to treatment and are grown in quarantine for two years. When potatoes are in short supply in Australia, potatoes may be imported from specified disease free areas of New Zealand. These potatoes are imported only for processing under quarantine supervision, and must be free of soil and packed in clean containers. There is no quarantine restriction on the import of frozen or processed potatoes as these are non-viable and do not present a quarantine risk. 1. b ) Avocados may only be imported from areas free of the disease sunblotch, or from groves which have been certified free of the disease by an acceptable authority. Avocados from an area where fruit fly is present are subject to mandatory fumigation, otherwise they are inspected on arrival in Australia and treated if required. 2. Cut flowers may only be imported provided they are not prohibited species (e.g. weeds or poisonous plants) and provided they cannot be propogated. The flowers are inspected on arrival and given an appropriate treatment if it is required. {:#subdebate-87-65} #### Freight Subsidies (Question No. 1051) {: #subdebate-87-65-s0 .speaker-JT9} ##### Mr Bungey: asked the Minister for the Northern Territory, upon notice, on 2 June 1977: {: type="1" start="1"} 0. 1 ) What amounts have been paid by way of freight subsidy on cattle transported from the Northern Territory to (a) Queensland, (b) South Australia and (c) Western Australia in the 6 months ended 3 1 December 1 976. 1. What other freight subsidies ate paid in respect of stock or goods entering or leaving the Northern Territory, and what has been the cost of these subsidies in the same period. 2. What amount has been paid on subsidising freight of cattle within the Northern Territory in the same 6 months. {: #subdebate-87-65-s1 .speaker-ID4} ##### Mr Adermann:
Minister Assisting the Minister for National Resources · FISHER, QUEENSLAND · NCP/NP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) ( a ) $ 1 36,700; ( b ) $69,900; (c) $34,700. 1. 2 ) No other subsidies are in existence. 2. $55,200. {:#subdebate-87-66} #### Airport Ratings (Question No. 1065) {: #subdebate-87-66-s0 .speaker-HI4} ##### Mr Morris: asked the Minister for Transport, upon notice, on 2 June 1 977: {: type="1" start="1"} 0. 1 ) Has he received the report of the study into the 3 airports given 'black star' ratings by the International Federation of Airline Pilots in April 1977. 1. If so, when will he table the report in the Parliament. {: #subdebate-87-66-s1 .speaker-009OD} ##### Mr Nixon:
Minister for Transport · GIPPSLAND, VICTORIA · LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 have received a report from my Department regarding the 'black star' ratings given to Kalgoorlie, Meekatharra and Learmonth aerodromes by IF ALP A. 1. It is not my intention to table this report because the facts are as follows- {: type="a" start="a"} 0. it is accepted that the international standards laid down by the International Civil Aviation Organisation (ICAO) reflect a requirement for Rescue and Fire Fighting (RFF) services at all international airports and international alternate airports. 1. it is recognised that this standard is met at all international airports in Australia, but not at some international alternate airports. 2. it is clearly uneconomic to provide RFF services at all international alternate airports in Australia, considering the very few international aircraft diversions that some are required to accommodate e.g. during 1976, only seven international aircraft had cause to divert from Perth Airport to a suitable international alternate airport. -4 Boeing 707 's diverted to Meekatharra -2 Boeing 747 's and I DC-8 diverted to Learmonth -Kalgoorlie is no longer used as an alternate for international aircraft. 3. d ) it is not possible to equip all airports in Australia with a full range of aviation facilities and it is important to so locate facilities as to ensure that they give the best possible service to the aviation industry as a whole. 4. Australia is ranked amongst those countries enjoying the best safety records in the world, largely because of the very high safety standards set by the Department ofTransport.

Cite as: Australia, House of Representatives, Debates, 16 August 1977, viewed 22 October 2017, <http://historichansard.net/hofreps/1977/19770816_reps_30_hor106/>.