House of Representatives
25 March 1980

31st Parliament · 1st Session

Mr SPEAKER (Rt Hon. Sir Billy Snedden) took the chair at 2. 1 5 p.m., and read prayers.

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The Clerk:

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

National Women’s Advisory Council

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

The petition of the undersigned citizens of Australia respectfully showeth:

That the National Women’s Advisory Council has not been democratically elected by the women of Australia.

That the National Women’s Advisory Council is not representative of the women of Australia.

That the National Women’s Advisory Council is a discriminatory and sexist imposition on Australian women as Australian men do not have a National Men’s Advisory Council imposed on them.

Your petitioners therefore pray:

That the National Women’s Advisory Council be abolished to ensure that Australian women nave equal opportunity with Australian men of having issues of concern to them considered, debated and voted on by their Parliamentary representatives without intervention and interference by an unrepresentative ‘Advisory Council ‘.

And your petitioners as in duty bound will ever pray. by Mr Braithwaite, Mr Bryant, Mr Burns, Mr Ewen Cameron, Dr Cass, Mr Corbett, Mr Dean, Mr Fisher, Mr Howe, Mr Innes, Mr Barry Jones, Mr Lloyd, Mr Martyr, Mr Moore, Mr Scholes and Mr Shipton.

Petitions received.

National Women’s Advisory Council

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

The petition of certain citizens respectfully showeth:

Their support for and endorsement of the National Women ‘s Advisory Council.

We call on the Government to continue to maintain the National Women’s Advisory Council and increase Federal Government support for its activities.

And your petitioners as in duty bound will ever pray, by Mr Burns, Mr Goodluck and Mr Jacobi. Petitions received.


To the Right 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 the proportion of pensionable people within our community is increasing at a significant rate. The number of people over 65 years old will rise from approximately 8.S per cent of the population as it was in 1 970 to over 1 0 per cent by 1 990 and about 1 6 per cent by the year 2020.

That technological change is accelerating the trend towards earlier retirement from the workforce.

That the above factors make incentives for self-provision in retirement years a matter of great urgency if future generations of Australians are to be spared the crippling taxation which would be necessary to fund such provisions from social welfare.

That Australia is in urgent need of locally raised investment capital for national development and that life insurance and superannuation funds are important mobilisers of such capital.

Your petitioners therefore most humbly pray that the Government will forthwith take the steps necessary to:

  1. Remove contributions paid by the taxpayer to superannuation funds from the rebate system and make them a separate deduction from assessable income.
  2. Allow as such deduction amounts necessary to provide the individual with a reasonable retirement benefit as defined from time to time by the Commissioner of Taxation.
  3. Remove life insurance premiums paid from the rebate system and make them a separate deduction from assessable income also.
  4. Allow such a deduction to take the form of a flat rebate of 20 per cent of life insurance premiums up to a limit of $2500.

And your petitioners as in duty bound will ever pray, by Mr Lionel Bowen and Mr Les McMahon. Petitions received.

National Women’s Advisory Council

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

The humble petition of the undersigned members or organisations listed below and citizens of Australia respectfully showeth:

That the thorough nationwide investigations by the Working Party highlighted the need to establish the National Women ‘s Advisory Council.

That we believe the Council consistently and democratically demonstrates its wide representation of the interests of all Australian women, as shown by the Draft Plan of Action for the 1980 National Conference to be held in Canberra in preparation for Australia’s participation in the United Nations Decade for Women World Conference in Denmark, July 1980.

Your petitioners therefore humbly pray:

That the Parliament will continue its support of the National Women’s Advisory Council and its recommendations.

And your petitioners as in duty bound will ever pray,

Petitions received. by Mr Bungey and Mr Innes. Petitions received.

Liquefied Petroleum Gas

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

The petition of the undersigned citizens of Australia respectfully showeth: That the price of LPG in Victoria has risen by $80 per tonne since November 1978 as a result of Federal Government policy thereby causing hardship to country consumers using LPG for cooking, heating and hot water and to decentralised industries using LPG for industrial purposes.

Your petitioners therefore pray:

  1. that the Federal Government should abolish its so called ‘export parity” pricing policy for LPG consumed in Australia.
  2. that the price of Bass Strait LPG sold on the Australian market should be related to the true cost of production plus a fair margin of profit for the producers;
  3. that all LPG ex Bass Strait consumed on the Australian market should be free of excise levy;
  4. that there should be no restriction on availability of LPG ex Bass Strait to meet the requirements of the Australian market;
  5. that the price of LPG ex oil refineries should be established by PJT at parity with Bass Strait LPG consumed on the Australian market;
  6. that pending the establishment of a fair price in accordance with Clause 2 above and to provide some immediate relief to country consumers:

    1. the existing excise on Bass Strait LPG consumed in Australia be abolished forthwith, thus providing a reduction in price of $27.60 per tonne for propane,
    2. that the windfall profit that Esso/BHP is enjoying as a result of the increase in price of LPG from $1 10 to $147 per tonne be directed to Australian consumers rather than the Federal Treasury through excise, thus providing an additional decrease in the present price of $37.00 per tonne.

And your petitioners as in duty bound will ever pray, by Mr Ewen Cameron and Mr Nixon. Petitions received.


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. Present income tax laws are unfair to single income families,
  2. All marriages should be recognized as partnerships by allowing partners to divide their joint income for tax purposes,
  3. The family, which is the .natural and fundamental group unit of society, should be an economic unit in tax laws,
  4. Children are Australia’s future and their individual care by a parent at home should not be discouraged by extra tax.

Your petitioners therefore humbly pray that Parliament will

Reform income tax laws to allow the joint income of husband and wife to be equally divided between them for taxation purposes.

And your petitioners as in duty bound will ever pray, by Mr John McLeay and Mr Moore. Petitions received.

Religious Organisations

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 the anti-social activities of certain organisations, in the main purporting to be religious and under foreign control, are causing increasing mental, physical and/or social distress to citizens throughout the Commonwealth of Australia.

Such adverse effects include drastic personality changes, alienation and severance from persons’ families and normal society, dispossession under undue influence of persons’ worldly assets, abandonment of socially useful occupations or career education, mental disorientation, and a .common requirement to surrender their labour with little or no pay, working unduly long hours fund-raising for the exclusive benefit of the organisations’ leaderships.

Furthermore, a disturbing number of our country’s youth have died prematurely in unsatisfactorily explained circumstances or have become so mentally or physically debilitated as to require hospitalisation or treatment following their involvement with the subject organisations commonly, but erroneously, described as ‘religious ‘cults.

All evidence points to the fact that the subject organisations are commercial enterprises which, for the purpose of evading tax and other business obligations, have falsely assumed the status of ‘religions’ in order to take advantage of the blanket protections provided by Section 1 16 of the Australian Consititution

It is your petitioners’ sincere belief that proliferation of such organisations unchecked with their personalitydisorientating and family-diversive practices and effects, represents a serious threat to the health, welfare, and peace of the whole community.

Notwithstanding the decision of the combined Australian Attorneys-General at their October 1979 meeting, that no special action should be taken by Government/s to curb undesirable activities of religious cults and that these should be dealt with under existing laws, such laws as would provide protection against the aforementioned malpractices do not appear to exist.

For this reason, the Government should proceed with all haste to investigate the widely-alleged malpractices of the subject organisations which include the Hare Krishnas, the Unification Church (Moonies), and such other groups as are the subject of complaints, preparatory to introducing appropriate legislation to curtail the said malpractices to ensure citizens’ continuing enjoyment of peace and harmony.

And your petitioners as in duty bound will ever pray,

Petition received. by Mr Adermann. Petition received.

Aboriginal Land Rights

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

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

Whereas before Europeans settled in Australia, the Aboriginal peoples of Australia had lived on their traditional lands from time immemorial and had in Aboriginal law and customs a clear title to those lands; and whereas Europeans and other non-Aboriginal people have occupied and used most of the traditional lands of the Aboriginal peoples against their will and without negotiation, compensation or treaty; and whereas it has been the practice of nations established in territories previously occupied by indigenous inhabitants to reach a negotiated settlement with those inhabitants; and whereas that occupation has seriously damaged the traditional way of life of Aboriginal Australians and has caused poverty and hardship to be the fate of the great majority of their surviving descendants; and whereas the surviving descendants of the Aboriginal peoples have expressed a wish to have their rights to land acknowledged, to preserve their link with their Aboriginal ancestors and to maintain their distinctive identity with its own cultural heritage; and whereas the people of Australia in 1967 voted overwhelmingly that the Commonwealth Parliament should have responsibility for laws relating to Aboriginal Australians; and whereas it is accepted internationally by the United Nations organisation that each country should work to establish the rights of indigenous peoples to selfdetermination, non-discrimination and the enjoyment of their own culture; and whereas the Woodward Commission in 1974 established principles by which Aboriginal rights to land should be acknowledged and realised; and whereas the Senate of the Commonwealth Parliament in February 1973 resolved that Aboriginal Australians should be compensated for the loss of their traditional lands and for the damage to their way of life; and whereas the National Aboriginal Conference unanimously resolved in April 1979 in Canberra to ask the Commonwealth Government to negotiate a Treaty with Aboriginal Australians.

Your petitioners therefore humbly pray that the Commonwealth Government should invite the Aboriginal people of Australia to negotiate a Treaty with the Commonwealth of Australia, and any Treaty should contain provisions relating to the following matters: (i) The protection of Aboriginal identity, languages, law and culture, (ii) The recognition and restoration of rights to land by applying, throughout Australia, the recommendations of the Woodward Commission, (iii) The conditions governing mining and exploitation of other natural resources on Aboriginal land, (iv) Compensation to Aboriginal Australians for the loss of traditional lands and for damage to those lands and to their traditional way of life, (v) The right of Aboriginal Australians to control their own affairs and to establish their own associations for this purpose.

And your petitioners as in duty bound will ever pray, by Mr Holding. Petition received.

Military Alliances

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

  1. Military arrangements with ASEAN countries involve the maintenance of Australian military forces in Singapore and Malaysia; training of servicemen, military aid and joint military manouevres with most ASEAN countries.
  2. Almost all ASEAN regimes are oppressive and undemocratic in character, three of them being military dictatorships.
  3. Throughout the region there are opposition tendencies, which are brutally suppressed, and widespread and growing liberation movements.
  4. In these circumstances Australia’s military arrangements with ASEAN countries are likely to involve us in direct military action in support of the unstable, unpopular regimes- in ‘New Vietnams’.

Your petitioners most humbly pray that the Australian Government will undertake.

  1. 1 ) to express its strong opposition to arrangements involving maintenance of Australian military forces in other countries.
  2. to end military arrangements with ASEAN countries involving the maintenance of Australian military forces in Singapore and Malaysia, training of servicemen, military aid and joint military manouevres with most ASEAN countries.

And your petitioners as in duty bound will ever pray,

Petition received. by Mr Innes. Petition received.

Aid to Vietnam

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

The petition of the undersigned respectfully showeth,

  1. That the social, economic and environmental effects of over thirty years of war in Vietnam were considerable.
  2. That the effects of the war have been exacerbated by a succession of major natural disasters and by the refusal of the United States of America to fulfil their aid obligations.
  3. That the Australian Government and the Australian people have, because of their involvement in the war against the Vietnamese people, a strong responsibility to grant maximum possible aid to the Government of and people of Vietnam.
  4. That actions by other nations to fulfil their reconstruc tion aid obligations to Vietnam will greatly assist in rebuilding the living standards of the Vietnamese people thus assisting in alleviating the refugee problem.

Your petitioners most humbly pray that the Australian Government will undertake to

  1. reverse its decision to suspend all reconstruction aid to and cultural exchanges with the Socialist Republic of Vietnam.
  2. develop in conjunction with the Government of the

Socialist Republic of Vietnam a reconstruction aid program so as to fulfil our moral obligations to the people of Vietnam.

And your petitioners as in duty bound will ever pray,

Petition received. by Mr Innes. Petition received.

Tertiary Education Assistance Scheme

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 the reintroduction of tuition fees for tertiary education and the introduction of a loans scheme of student financing as suggested by a research paper for the National Inquiry into Education and Training, and as recommended for further study by the Committee of Inquiry, would add a significant financial burden to the already low finances of tertiary students.

Your petitioners also note that according to a major study on the abolition of fees made through the University of N.S.W. Tertiary Education Research Centre, it is the category of students presently under-represented in tertiary education who would be most disadvantaged by the reintroduction of fees.

Furthermore, 20 per cent of students surveyed in that study said they would be forced to defer or not enrol if fees were reintroduced.

Your petitioners therefore humbly pray:

  1. . That fees for tertiary study not be reintroduced.
  2. That the grants based Tertiary Education Assistance Scheme (TEAS) not be threatened by the introduction of a loans scheme of student financing.

And your petitioners as in duty bound will ever pray.

Petition received. by Mr Innes. Petition received.


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

The petition of certain citizens respectfully showeth-

That the right to work without discrimination on any ground including, inter alia, discrimination on grounds of race, ethnic origin, marital status and/or sex is a fundamental human right;

That it is both the duty and the responsibility of society to fully support those denied work and therefore those who are unemployed as a result of society’s inability to provide full paid employment should be guaranteed an adequate income without discrimination on any ground, including inter alia discrimination on grounds of race, ethnic origin, marital status and /or sex.

Your petitioners therefore humbly prayThat appropriate and adequate laws be formulated and passed to outlaw discrimination in Commonwealth employment, in employment of persons by statutory bodies and quasi-governmental organisations, in employment of individuals under federal awards, and in employment of all persons in areas over which Commonwealth and Australian Capital Territory equal opportunity legislation should have jurisdiction; and

That appropriate laws be formulated and passed to outlaw discrimination in the provision of unemployment benefits to all persons without regard to race, ethnic origin, marital status and/or sex.

And your petitioners as in duty bound will ever pray,

Petition received. by Mr Innes. Petition received.


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

That the government will act to prohibit the use of all public moneys for the killing of unborn children. That the said use of government moneys is an unacceptable government endorsement of a great national tragedy- the deaths annually of at least 80,000 unborn children.

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

Petition received.

Telephone Services

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 the changes to the system of telephone charging announced by the Minister for Post and Telecommunications on Tuesday, 5th June, 1979, fail to meet the needs of the people of the Division of Macquarie in the following respects:-

  1. The failure to grant local call access to Sydney to the residents of the City of Penrith is a clear repudiation of a promise made to those residents by the Government in 1977; and
  2. The bulk of the City of Blue Mountains will fail to gain any significant concession through the new arrangements, despite the fact that the City qualifies as a nearMetropolitan area.

Your Petitioners therefore humbly pray that the House take action to give all necessary directions to have those subscribers presently in the 047 Zone included in the Sydney Telephone District.

And your petitioners as in duty abound will ever pray, by Mr Innes. Petition received.


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 a grave threat to the life of refugees from the various States of Indo-China arises from the policies of the Government of Vietnam.

That, as a result of these policies, many thousands of refugees are fleeing their homes and risking starvation and drowning. Because of the failure of the rich nations of the world to provide more than token assistance, the resources of the nations of first refuge, especially Malaysia and Thailand, are being stretched beyond reasonable limits.

As a wealthy nation within the region most affected, Australia is able to play a major part in the rescue as well as resettlement of these refugees.

It should be possible for Australia to: establish and maintain on the Australian mainland basic transit camps for the housing and processing of 20,000 refugees each year. mobilise the Defence Force to search for, rescue and transport to Australia those refugees who have been able to leave the Indo-China States. accept the offer of those church groups which propose to resettle some thousands of refugees in Australia.

The adoption of such a humane policy would have a marked effect on Australia’s standing within the region.

And your petitioners as in duty bound will ever pray, by Mr John McLeay. Petition received.

Sydney (Kingsford-Smith) Airport

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

The Humble Petition of undersigned Citizens of Australia respectfully showeth-

  1. We call upon the Commonwealth and State Governments to select a site for Sydney’s second Airport now and to protect it by immediate development.
  2. We do not agree to the expansion of the Sydney (Kingsford-Smith) Airport.
  3. We support the Marrickville Municipal Council’s opposition to the Airport extension proposals.
  4. We do not agree that nuisances from aircraft noises are reducing.
  5. We oppose any shorter evening ‘curfew’ hours.

Your Petitioners therefore humbly pray that there be no extension of Kingsford-Smith Airport, Sydney.

And your petitioners as in duty bound will ever pray,

Petition received. by Mr Les McMahon. Petition received.


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 there is an urgent need to ensure that the living standard of pensioners will not decline, as indeed the present level of cash benefits in real terms requires upward adjustment beyond indexation related to the movement of the Consumer Price Index. By this and other means your petitioners urge that action be taken to:

  1. Adjust all pensions and benefits quarterly to the Consumer Price Index including the ‘ fixed ‘ 70 ‘s rate.
  2. Raise all pensions and benefits to at least 30 per cent of the Average Weekly Earnings.
  3. Taxation relief for pensioners and others on low incomes by:

    1. The present static threshold of $75 per week for taxation purposes be increased to $ 1 00 per week.
    2. A substantial reduction in indirect taxation on consumer goods.

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

Commonwealth Employees (Employment Provisions) Act

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

The humble petition of electors of the State of Victoria respectfully showeth-

That the Commonwealth Employees (Employment Provisions) Act 1977 should immediately be repealed because:

It provides unfettered power to Ministers to suspend, stand-down and dismiss Commonwealth Government employees and places them in a markedly disadvantageous position as compared with all other Australian workers.

Its use places Commonwealth Government employees in direct conflict with the Government as it circumvents the arbitration tribunals and denies appeal rights.

Its use will exacerbate industrial disputes and inflame industrial relations in the Commonwealth area of employment.

The International Labour Organisation has condemned the Provisions of the Act as being incompatible with the rights of organised labour in a free society.

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

Olympic Games

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

This humble petition of the sportsmen and women and citizens of Australia respectively showeth that:

Valuing the Olympic movement as an historic expression of all that is worthwhile in human endeavour and conscious of the important role competitive sport plays in maintaining health and the spirit of achievement in everyday life.

Honouring the high principles consistently pursued by the International Games Administration of keeping the movement free from religious, racial and political considerations.

Realising that the Oympic movement owes its resilience and very existence to the citizens of the nations from whom spring the participants in the contests and that the survival of this movement is the cherished hope of all communities.

We the undersigned sportsmen and women and citizens of the Commonwealth of Australia by this humble petition respectfully pray that the Australian government do all in its power to ensure the participation of a full Australian contingent in the XXII Olympic Games to be held in Moscow, USSR, from 19th July to 3rd August, 1980.

And your petitioners as in duty bound will ever pray, by Mr Les Johnson. Petition received.


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

The petition of certain citizens of N.S.W. respectfully showeth:

Dismay at the reduction in the total expenditure on education proposed for 1980 and in particular to Government Schools.

Government Schools bear the burden of these cuts 1 1.2 per cent while non-Government schools will receive an increase of 3.4 per cent.

We call on the Government to again examine the proposals as set out in the guidelines for Education expenditure 1980 and to immediately restore and increase substantially in real terms the allocation of funds for education expenditure in 1 980 to Government schools.

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

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Notice of Motion


-I give notice that on the next day of sitting I shall move:

That this House condemns the Government for its failure to:

Initiate a comprehensive public investigation into reports emanating from East Timor last year that a gross denial of human rights has been perpetrated in the Territory, resulting in the deaths of tens of thousands of civilians, and in the subsequent failure by the Indonesian authorities to provide for the basic needs of those Timorese whose livelihood was disrupted by the military intervention, and the military operations designed to suppress the resistance to Indonesian occupation.

Mr Hodgman:

-Why didn’t you speak out three years ago?


– I was not here then. The notice of motion continues:

  1. Actively promote in the United Nations General Assembly, and its specialised agencies, support for an appropriate and impartial investigation into the many allegations during the past 3 years that atrocities have been carried out in East Timor by the occupying authorities.
  2. Exert appropriate pressure on the Indonesian Government to abide by the agreement it entered into in 1 978 to permit 600 persons from East Timor to be reunited with their families now resident in Australia.
  3. Give active support in the United Nations to General Assembly resolutions, which have consistently reaffirmed the inalienable rights of the people of East Timor to self-determination and independence, and insisted that ‘they must be allowed freely to determine their own future under the auspices of the United Nations’.
  4. Suspend the provision of military aid to Indonesia, until:

    1. an inquiry has established the facts of the situation in the Territory,
    2. an undertaking has been obtained from the Indonesian Government that it will take immediate steps to grant to the people of East Timor a greater degree of self-government.

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– I ask a question of the Prime Minister. I refer to the Government’s campaign to prevent an Australian team from participating in the Moscow Olympics and to cut off other scientific and cultural exchanges. I ask: Is it a fact that the Chief Justice of the High Court of Australia, the Prime Minister’s former Liberal Party colleague, Sir Garfield Barwick, has invited some 130 judicial representatives to a conference in Sydney starting on 19 May? Is it a fact that among those who have accepted the Chief Justice’s invitation are three judges from the Soviet Union?

Opposition members- Oh!


-Order! The House will come to order while the question is being asked and the answer is being given.


– Will the Prime Minister confirm that the Soviet judges have been invited to the opening of the new High Court building in Canberra on 26 May by Her Majesty the Queen?

Prime Minister · WANNON, VICTORIA · LP

– I do not know, and the Government would not know, who was on the list of judges who have been asked by the High Court, but I do know that the Government’s policy is a firm one. If any Soviet judge has been asked and has accepted, as a result of the policy that the Government has announced he obviously would not get a visa. That has been explained to the Chief Justice and he understands the Government’s policy very fully indeed. Therefore, the question of whether Soviet judges will be coming to the opening of the High Court building does not arise and will not arise.

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-Can the Minister for Foreign Affairs give the House any details from Government sources concerning reports over the weekend of the systematic slaughter by Russian and Afghanistan troops of some 1,200 men and boys over the age of seven in the town of Kerala? Further, can the Minister provide any information regarding a report, reputedly from Indian intelligence sources, that Russia is training troops in south-eastern Afghanistan for a spring offensive which could give the Soviet Union direct access to the Persian Gulf and the oil shipping lanes?

Minister for Foreign Affairs · KOOYONG, VICTORIA · LP

– I am aware of a wide range of reports indicating that atrocities have taken place not only in the village of Kerala, as mentioned by the honourable member, but also in many other parts of Afghanistan. There is strong evidence to suggest that the Soviet Union has played a leading role in armed attacks against innocent Afghan men, women and children. Further, it is clear that as winter recedes and the fighting increases, more innocent people will lose their lives, or their homes, or will be forced to flee to safer areas. In no way can the Australian Government condone such action by the Soviet Union and the so-called ruling Afghan regime. I am sure that all honourable members will join me in deploring the acts of violence that are now taking place in Afghanistan.

This Government has vigorously condemned the Soviet invasion of Afghanistan. It has deplored the loss of life and suffering caused by the continuing military occupation, and we remain convinced that unless the Russians withdraw their forces there can be no end to the bloodshed and no return to normalcy in Afghanistan.

So far as the second part of the honourable member’s question is concerned, I am not in a position to provide further information on the report quoting Indian intelligence sources. However, the opportunities for creating problems in Baluchistan must be obvious to all.

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-I preface my question to the Minister for Industrial Relations by referring him to yesterday’s statement of Sir Nigel Bowen, the Chief Justice of the Federal Court, that the court was restricted- that is the word that he used- in the way in which it could consider matters brought before it under section 45D of the Trade Practices Act. I also refer the Minister to the comment of Sir John Moore, at yesterday’s meeting of the parties to the settled New South Wales oil industry dispute, to Mr Priestly, Q.C., counsel for the Federal Government. Sir John asked: ‘What about the provisions of the Conciliation and Arbitration Act? Do you propose to deal with those, Mr Priestly?’ In view of the fact that hearings before the Federal Court are protracted, legalistic hearings, where the merits of the case cannot be heard, and in view of the Government’s humiliation at yesterday’s meeting before Sir John Moore, will the Minister now take up the second option recommended by the Swanson committee into the Trade Practices Act, that the matter of secondary boycotts be dealt with by the Conciliation and Arbitration Commission?

Minister for Industrial Relations · CORANGAMITE, VICTORIA · LP

-The Government has always made it clear that section 45D is in the Trade Practices Act to maintain exact even-handedness of treatment of boycotts, whether they occur between a company and a company or between a union, an individual and a company. The Government believes that that is the proper place for such actions to be taken. As has already been announced, as a result of the latest experience in relation to section 45D matters if that section is found to be unable in some way to cope with situations which have arisen after the latest proceedings the Government will be amending it to ensure that it does.

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– My question, which is directed to the Minister for Foreign Affairs, refers to the reported disappearance of a Perth resident, Mr David Ian Wilkie, during the recent civilian protests in Kabul against the Soviet occupation of Afghanistan. Can the Minister provide the House with details of the Government’s efforts to ascertain the whereabouts and personal safety and welfare of this Australian national?


-An Australian citizen, who has been identified by the honourable member for Tangney as David Ian Wilkie of Perth, was reported missing in Afghanistan. Information available to the Government indicated that Mr Wilkie left his hotel in Kabul on 23 February, apparently to apply for a visa at the Soviet Embassy. Mr Wilkie failed to return to his hotel on that day which witnessed very serious disturbances by the inhabitants of Kabul against the Soviet occupation of Afghanistan. Inquiries made by the Australian Embassy in Islamabad through the United States and British embassies in Kabul were initially unsuccessful in tracing Mr Wilkie, but I am pleased to report that the British authorities in Kabul have now advised that Mr Wilkie was released by the Afghan security authorities on 23 March after one month ‘s detention, and that he is evidently in good health and spirits. A full report on his detention is expected to be available to the Australian Embassy in Islamabad in the next few days. Meanwhile, his family, of course, has been notified. As Australia has no resident representative in Kabul, I would like at this time to record the Government’s appreciation of the assistance provided by the United States and British embassies in this case.

page 1107


Mr Charles Jones:

-I draw the attention of the Prime Minister to his disastrous intervention in the New South Wales oil tanker dispute -


-Order! The honourable gentleman will not intrude his own opinion into the question. He can seek information.

Mr Charles Jones:

-It is public opinion, sir.


-The honourable gentleman will ask his question or I will rule him out of order.

Mr Charles Jones:

-I ask the Prime Minister: Will he assure the House that there will be no further Government efforts to inflame industrial relations by attempts to coerce and threaten the Australian Conciliation and Arbitration Commission? Will he give a further assurance that the Government will cease its attempts to dictate to the President of the Commission on internal arrangements in a manner which can only compromise relations between individuals and undermine the independence of the Commission?


-The honourable gentleman again underlines the lack of Australian Labor Party concern for small businesses and for individuals who are caught in the toils of an industrial dispute. Let me state again the reasons for the Government’s concern. When a large and powerful corporation in some way, tacitly or explicitly, combines with a large and powerful union to deny the right to survive- in this case, to deny product to Mr Laidely- there is a serious situation within Australian society and within that industry. This Government is concerned that small businesses and individuals be given a right to survive and to work out their own futures. It is not merely concerned with the dictates of the Transport Workers Union of Australia and the acquiescence in those dictates by large and powerful companies in buying industrial peace at the expense of some important facets of Australian life.

If anything in this country is worth preserving, it is the situation in which individuals have a freer life than anywhere else and in which small businesses can survive. Small businesses employ up to two million people- a large part of the total employment force. They need to know that there is protection of the law for their right to survive. The honourable gentleman does not serve the cause of small businesses when he implies that if this Government sees large business and large unions combining in a way which damages small businesses we should do nothing about it. Whether it is an agreement between the two groups or an agreement encompassed under the auspices of the Arbitration Commission will make no difference to our attitude.

I can only say that from the Government’s point of view, if the parties to this dispute, including Sir John Moore under whose auspices the agreement was consummated, were prepared to agree that the nature of the agreement be made public, then the wider Australian community would understand very plainly the full weight of this Government’s concern. Under those circumstances, I would be very surprised also if the honourable gentleman and his party did not share a significant part of our concern.

On that basis I invite the parties concerned to agree to the processes to enable publication of the agreement to take place. But we accept that it is their document and it is a decision that they must make because it was put to the Minister for Industrial Relations on a private and confidential basis. There is a very real public interest in the matter becoming public and it is up to the parties to respond to that if they do not wish to maintain the kind of fiction that is encompassed in the honourable member’s question.

On the wider issue, there is a role for the Government of New South Wales in relation to these matters. It has a role in maintaining supplies to its communities, to the city of Sydney in particular. It also has a role under its own Energy Act, under which Mr Wran has taken to himself certain powers which he could have used, and which he could still use, to protect the small business of Mr Laidely if Mr Wran has any concern for that business.

Mr Les Johnson:

– Who said he is a small businessman?


– I am glad that the honourable member interjects that it would be foolish to protect the interests of small business. That is the import of his interjection. If members of the Australian Labor Party want to fall into the mire, so be it. That will be picked up and made evident. Everything the Labor Party has done in this instance has supported the agreement reached between Amoco Australia Ltd and the union and denied support to a small business. That needs to be plainly understood. The Government has a quite different view of the matter and, whilst perhaps understanding some aspects of what happened yesterday and wishing that Sir John Moore might have taken a more active role in seeking to achieve justice for Mr Laidely, at least there are now discussions between Mr Laidely ‘s association and the Transport Workers Union. The results of those discussions are to be reported back to Sir John Moore on Friday, and I hope very strongly that Sir John Moore will use his undoubted influence in these matters to achieve a flow of product to Mr Laidely and that small business. This dispute is symptomatic of the difficulties in which thousands of small businessmen, who employ up to two million people, could find themselves if the instruments of authority and of government were to give in to the kind of industrial blackmail being practised by the Transport Workers Union.

page 1109




– I address my question to the Minister for Employment and Youth Affairs. Has the Minister seen reports of an apprenticeship proposal launched over the weekend to boost to 60,000 the intake of apprentices? Will the Minister explain to the House the apprenticeship record of the Government and inform honourable members of the cost of such a proposal?

Minister for Employment and Youth Affairs · STIRLING, WESTERN AUSTRALIA · LP

– The apprenticeship proposal launched over the weekend must be one of the most inadequate of all of those launched over the weekend. One other I could mention that is more inadequate is the private sector employment program, but let me direct my attention to the honourable member’s question. The premise upon which this proposal was put forward is completely false. At this time the contribution made by migration to the number of skilled tradesmen is smaller than it has been for more than two decades. Over the last 10 years the net migrant intake has dropped by about 10,000, from 15,750 in 1968-69 to about 5,700 in 1 977-78- the latest period for which information is available. I advise the honourable member that during the same period the number of skilled tradesmen being trained in Australia has grown from about 21,700 in 1968-69 to 32,900 in 1977-78.

Furthermore, and I am sure the honourable member will be interested in these figures, under the policies of the Fraser Government the apprenticeship intake has increased from 39,641 in 1975 to 44,127 in 1979. Against that background, it is little wonder that in this proposal no costing was provided for the proposal to increase apprenticeship intake by 20,000. Under our Commonwealth Rebate for Apprentice Fulltime Training program, we are spending something like $50m to support, in round figures, 40,000 apprentices. Therefore, if there is to be an increase of 20,000, there must be a substantial increase in the cost of CRAFT. In addition, quite obviously what the authors of this program have forgotten is that there will be a substantial increase in cost in technical and further education institutions for the increased number of courses that will have to be introduced to accommodate the increased intake of apprentices.

page 1109



– I inform the House that we have present in the gallery this afternoon a delegation from the National Assembly of the Republic of Korea led by Vice Speaker the Honourable Heung Moon Koh. On behalf of the House,

I extend a warm welcome to our distinguished visitors.

Honourable members- Hear, hear! QUESTIONS WITHOUT NOTICE

page 1109




– I refer the Prime Minister to the fact that last Thursday during Question Time he avoided the opportunity presented to him to affirm that he had complete confidence in the President of the Australian Conciliation and Arbitration Commission in his functioning in that position. I ask the Prime Minister: Does he have such confidence in Sir John Moore? If not, or if he again seeks to avoid answering that specific question, is that because Sir John Moore has firmly and properly rebuffed the Prime Minister’s efforts to compromise thoroughly the independence, impartiality and public credibility of the Commission by seeking to treat it as an extension of one of his departments and so subject to his direction?


– Before I call the Prime Minister I should indicate to the Leader of the Opposition that, while I give considerable latitude to that particular honourable gentleman, the asking of questions in terms which amount to argument is out of order. I will have to prevent the honourable gentleman from doing so in the future.


-Last week in relation to this matter I was quite precise. I indicated that Sir John Moore had served this country with distinction and I had no doubt that he would continue to serve it with distinction. At the same time it is necessary to point out once again that the Leader of the Opposition seeks to criticise this Government simply because this Government is standing up for the rights of small business, and for no other reason. It is inherent in the honourable gentleman’s question that he is opposing this Government on these matters because this Government is standing up for the rights of small business, which employs about two million people right around Australia. We will not make any apology to anyone for continuing to do just that.

I think there are some other things that flow out of this particular case. It is well worth noting, in particular, the remarks of Sir John Moore yesterday when he said that his task is to settle industrial disputes. Because the settlement of that particular dispute and the agreement that was consummated in relation to that particular settlement were undertaken without Mr Laidely or his association being present and were undertaken without any respect for the rights of that particular small businessman and the right of his business to survive, it is all the more reason to understand why the general framework of law within this community needs to underpin the right of survival of businesses and the freedom of Australian citizens. That again is one of the reasons why section 45D will be amended to make sure that combinations of the kind that resulted in this disturbance will not be repeated.

page 1110




– Has the Acting Minister for Trade and Resources seen Press reports claiming that the Government has imposed pricing requirements on sales to Japan of Australian steaming coal? Is there any truth in these reports?

Minister for Primary Industry · GIPPSLAND, VICTORIA · NCP/NP

– I did see the article in the Australian Financial Review today. It seems to me that the writer of that article demonstrates a woeful ignorance of the Government’s policies in respect of the export of minerals and the application of the guidelines for the administration of export controls to bulk commodities including steaming coal. The Government believes that its power to control exports is a reserve one to be exercised only in the national interest. The Government believes that the market place and the normal operations of supply and demand should determine prices obtained for our coal exports, provided the negotiations are carried on on a free arm’s length commercial basis. There is no question of the Government’s setting minimum prices for steaming coal. The suggestion, therefore, that the Government has interfered in this matter in this way is completely wrong.

page 1110




– I ask a question of the Prime Minister following his last response to me. In view of the Prime Minister’s professed determination to protect the interests of people wishing to engage in small business, by what steps does he propose to confront the powerful newspaper proprietors in order to allow a situation to develop wherein those people wishing to open up small businesses such as newspaper agencies will be able to do so unfettered by the present restrictions?


-If the honourable gentleman wishes to say that the proposals that have been arrived at and agreed upon for the distribution of newspapers are ones that he does not support, let him say so openly.

Mr Hayden:

– These are his double standards on the Olympics and trade.


-Order! I must ask the Leader of the Opposition to cease interjecting when an answer is being given to a question which he has asked.

Mr Hayden:

- Mr Speaker, I accept that, of course- I am overflowing with the milk of human kindness at the moment- but, Mr Speaker, I ask you, in the interests of a little bit of propriety and decency in the conduct of the House, to ensure that the Prime Minister occasionally addresses himself to the question asked instead of misrepresenting or evading the issues put to him.


-The Leader of the Opposition knows that, provided the Prime Minister’s answer is relevant, he is entitled to answer a question in any way he chooses. The answer was relevant and the Leader of the Opposition persistently interjected while the answer was being given. I am asking the Leader of the Opposition to co-operate by not interjecting.


-Mr Speaker, may I add to that answer?


-The right honourable gentleman may proceed.


– I am sure that the Leader of the Opposition is well aware that the agreement about the distribution of newspapers was arrived at with the agreement of the Trade Practices Commission.

page 1110




– Has the Minister for Employment and Youth Affairs seen reports of a so-called job opportunities program launched over the weekend? What is the Government’s record in job creation and job training schemes and what would be the true cost of the so-called job opportunities program?


– The Government has a very substantial record of job creation at no cost to the taxpayer.

Opposition members interjecting-


- Mr Speaker, the Opposition may howl in disagreement -


-Order! The Minister will resume his seat. While the concerted chorus of interjection continues the House will not proceed with its business. When I am assured of silence, I will call the Minister.


– The Opposition may howl in disagreement but let it face up to the fact that between January 1979 and January 1980 total employment rose by 139.200. Compare that with the record of the Whitlam Government when the Leader of the Opposition was a member of that Government. Between August 1973 and August 1975 the number of unemployed looking for full time work rose from 67,200 to 215,500- an increase of 2 10 per cent.

The honourable member for Herbert referred to a job opportunities proposal that was launched over the weekend. It is really a most transparent sleight-of-hand that is being perpetrated on the Australian public, seeking to raise the expectations of unemployed people when there is no substance at all to the program. What was put forward was a program presented as costing $ 1 80m net in the first year. The Leader of the Opposition, as Treasurer in the former Whitlam Government, knows that for budgeting purposes we need to look at the cost outlay in the Budget. What was disguised in the Press presentation was that the full-year cost on the Opposition’s net basis is $330m. In arriving at that figure the Opposition left out two things. It left out the $28m that is the present cost of the Special Youth Employment Training Program, and, as I pointed out in answer to an earlier question, it did not even cost its apprenticeship proposals to increase intakes by 20,000. If, however, one looks at the true cost of these programssubstantially they are the old Regional Employment Development scheme under another name and they cost as much- one will find that the figures come out more like this: For the Community Service Corps there is a true full-year cost of $600m. For the work program there is a true full-year cost of $325m. Let us put the private sector employment training program at $48m. That in total is $973m. Add to that something for the apprenticeship program and one gets a true full-year cost of the order of $ 1,000m.

The Opposition says that that kind of expenditure is to be on top of a program of economic expansion financed by fiscal stimulation. I am sure that my colleague, the Treasurer, would agree with me that the costs which I have indicated of $ 1,000m for these job opportunity programs, plus an economic policy of fiscal stimulation, are a sure recipe for inflation. If we go back to the days when the Leader of the Opposition was Treasurer in the Whitlam Government, we would have thought then that the sure way of defeating unemployment was to spend more money. We know, to the great cost of the Australian people, the unemployed in particular, that that is not a sure way to defeat unemployment. As our record shows, from the growth of 139,200 people employed in the labour force over the last 12 months we know that the only sure way to defeat unemployment is with a policy of economic growth. This will provide the employment growth which Australia requires, being the employment growth that we have seen in this country over the last 12 months.

page 1111




– My question is directed to the Prime Minister. I preface it by saying that this morning the Prime Minister was questioned about the increase in housing loan interest rates announced by the Bank of New South Wales. In his reply he stressed the changes taking place overseas. I ask the Prime Minister whether he recalls stating in a speech to the Australian and New Zealand Association for the Advancement of Science on 22 January 1 975:

When political leaders say the present situation cannot be helped, it is part of a world situation, they are expressing the futility of their own leadership.

In view of the Prime Minister’s commitment to reduce interest rates given during the 1977 election campaign, does the Prime Minister now consider that commitment politically foolish and economically irresponsible and the Government’s leadership futile? If not, what action does ‘ he intend to take to lighten the economic burden on home owners and first home seekers?


– I thank the honourable gentleman for having done some homework and having read that speech. I am sure he will regard it as having been a good one. It needs to be understood, I think, that those remarks were addressed at a time when there was world-wide inflation, where there had also been pressure because of the Organisation of Petroleum Exporting Countries oil price rises and where the Australian rate of inflation was compounded very greatly by the expenditure and wage policies of the then Australian Government. The point that was being made was that if there are difficult international circumstances then it is the bounden duty of any Australian government to pursue policies that will minimise those effects on the Australian community. It is the duty of an Australian government in those circumstances not to pursue policies that will compound the adverse effects of what might be happening overseas. Policies which were leading to expenditure expansion of 46 per cent in one year and between 20 per cent and 30 per cent in the next, and which led to a wage explosion of 38 per cent in one year, were obviously ones that were going to compound difficult overseas circumstances. They were policies, based in futility, of the then Labor Government. As a result of those policies, Australia’s competitive position worsened and our inflation rate became much worse than the Organisation for Economic Cooperation and Development average and the inflation rates of other major trading countries.

As a result of the different policies that we have pursued, against the background of an inflation rate of about 18 per cent in the United Kingdom and, depending on how and over what period it is computed, an inflation rate of around 15 per cent in the United States of America and against the background of interest rates of 19 per cent in the United States and a somewhat equivalent rate in the United Kingdom, and the pressures that have been building up in those countries, the strength of the Australian economy has come through very strongly indeed over the last several months. Whilst no economy can survive as an island unto itself, it is the duty of a government to take those decisions and those actions which will minimise the adverse effects of overseas events. That is precisely what we have done. It is the strength of the economy, the strength of the balance of payments and the strength of our monetary and fiscal policies that have enabled events in the United States and the United Kingdom to have, by comparison with the effect upon their own people, a much lesser effect on Australia than otherwise would have been the case.

I think that honourable members have only to imagine what would have occurred if over the last two years we had pursued the policies of our predecessors in office and had had a 46 per cent increase in expenditure in one year, a 25 per cent increase in expenditure in the next year and a wages policy that added 38 per cent to average wages over a 12-month period. If those policies had been pursued over the last three years, as they were in the three years to 1975, instead of the competitive position of Australian industries being improved, instead of Australian manufacturing exports growing and instead of Australian employment expanding, we would have had a sheer disaster situation in this country. That fact is widely recognised right around the Australian community, where there is support for the economic policies of this Government and a total rejection of the kind of policies that the Australian Labor Party pursued on a former occasion.

page 1112




– My question is addressed to the Treasurer. Is it a fact that in 1975 the value of total public company fixed interest capital raisings was about $950m and that in the same year the value of new government securities issued was about $870m? Is it also a fact that by 1979 companies raised only $ 1,200m, while the Government raised two and a half times as much, namely, $3, 000m? Is this extraordinary change in the proportions of total fixed interest investment inimical to the long term development of the private sector? Would the private sector’s problems be less if the Government reduced public sector deficits? Will the Treasurer bear these considerations in mind when he is framing the next Budget?


-The honourable member for Moore has asked a very thoughtful question about the relationship between the sizes of the public sector and the private sector. It gives me an opportunity to state quite unequivocally this Government’s commitment to reduce the crowding-out effect of public sector borrowings and the expansion of the public sector upon the size of the private sector. That commitment, of course, underlies the commitment of this Government to lower Budget deficits. It explains why the Budget deficit, expressed as a percentage of gross domestic product, peaked at about 5 per cent in 1 975 and has now come back to about 1 Vi per cent. It explains in part why we took the decision we took a couple of weeks ago to apply the proceeds of the crude oil levy to a reduction of the Budget deficit, particularly against the background of the difficult international economic circumstances that the Prime Minister mentioned a moment ago.

It also explains why the commitment of the Leader of the Opposition, repeated as recently as yesterday, to a steadily expanding public sector would be economic lunacy in the present circumstances in Australia. Certainly in framing future Budgets this Government will always keep very high in its priorities the need to maintain a proper relationship between the sizes of the public sector and the private sector. As he will know, the Commonwealth Budget deficit represents only part of the total public sector. The control of the Commonwealth Government over the size of other components of the public sector is less direct than its control over the size of the Budget deficit. I can assure the honourable gentleman that the types of considerations he mentioned will continue very much to occupy the thinking of the Government because we believe that they lie very much at the heart of a successful pursuit of the sort of economic philosophy to which we on this side of the House are committed.

page 1113




– Is the Minister for Home Affairs aware of the widespread reports arising from the Geneva conference last week and describing his efforts as maintaining a low profile and trying to be as inconspicuous as possible in relation to the alternatives to the Olympic Games to be held in July this year in Moscow? As this apparent natural reticence seems to be so uncharacteristic of the Minister, does it indicate an effort by him to be identified as little as possible with the attempt to organise an Olympic boycott and an alternative competition? Is the Minister’s apparently changed attitude the result of prior access to the results of the most recent Morgan gallup poll which was held on 23 and 24 February of this year, which were published in the 25 March edition of the Bulletin- certainly not a Labor paper- and which state that only 38 per cent of the Australian people support the Government’s proposed Olympic Games boycott?

Mr Leo McLeay:

– What percentage?


-Thirty-eight per cent. Has the Minister chickened out on this issue?

Minister for Home Affairs · WENTWORTH, NEW SOUTH WALES · LP

-I thank the honourable gentleman for his question because it enables me to inform honourable members, I hope at not too much length, of the visit that I undertook overseas. I say at the outset that the result of that visit so far as I was concerned was to confirm very strongly in my mind the view that the Government had taken in relation to the boycott of the Olympic Games in Moscow. The view that the Government has formed is shared by many other friendly governments. Up to 25 have already indicated their support of a boycott and another 25 have indicated their inclination that way. Let there be no doubt that in other parts of the world there is strong support for a boycott of the Moscow Olympics.

The meeting in Geneva was a very successful meeting. Its purpose was not to organise alternative Olympic Games but simply to make decisions which would enable alternative competition to be available to our athletes whom we have asked not to go to Moscow. At that meeting we and other countries, including the United States, the United Kingdom and Canada, drew up a series of sites which will be investigated. A number of basic propositions have to be taken into account in relation to the matter. The first is that which I have already mentioned; that is to say, we are not organising alternative Olympic Games. We are trying to set in motion means whereby our athletes will be able to have top level international competition. The other events which occurred included a firm decision that these sporting occasions should take place towards the end of August. We affirmed our belief in the Olympic ideal. We indicated that if these events were to be organised they would have to be organised through national sporting bodies and in accordance with the rules of international sporting organisations. The result is, therefore, that we have clearly set in motion means whereby top level international competition can take place in the world later this year, probably towards the end of August. I seek leave to incorporate in Hansard a document which sets out a summary of that meeting.

Leave granted.

The document read as follows-

Ministers and officials of twelve countries met in Geneva on 17/18 March to examine problems arising from the location of the Olympic Games in Moscow which will result in a number of athletes not being able to compete.

Those participating recalled briefly the background to the present meeting. On IS January 1980, 104 nations had voted at a special session of the General Assembly of the United Nations in favour of a resolution condemning the invasion of sovereign independent Afghanistan. There had been widespread condemnation in other fora of the actions of the Soviet Union, not only in this regard, but also in the field of human rights where the repressive actions of the Soviet Government have likewise caused serious concern. Many Governments throughout the world had since indicated their opposition to the summer Olympic Games taking place in Moscow because that would be represented to the people of the Soviet Union as condoning the Soviet Government’s actions.

It had been recognised for some time that this had created a situation of particular difficulty for athletes throughout the world who would otherwise have wished to compete in the Moscow games. Consultations between a number of nations closely concerned had been taking place in recent weeks to see what might be done. The situation had now reached a point at which it was thought appropriate to hold a meeting to review the present situation. The countries represented at the meeting had of course already been in touch with a large number of others.

The meeting noted that there were growing indications that given the continuing Soviet occupation of Afghanistan, an increasing number of National Olympic Committees might decline the invitation to go to Moscow; that this could affect the quality of competition at Moscow; and that whilst the organisation of events for any international games was a matter for national and international sporting bodies and not for governments, the principle of holding separate special games, sport by sport, should be actively pursued.

There was a helpful discussion on how this might be done. A set of suggestions emerged covering such matters as the availability of sites in different countries, the building on to events already featuring in the sporting calendar, and the possibility of staging new events should that be necessary. There were indications that some governments might be ready to oner financial support.

The meeting noted the recent statements of national and international sporting bodies regarding the holding of alternative games and in particular the statement made on 10 March by the Executive Committee of the International Amateur Athletic Federation (IAAF)

Countries represented at the meeting will now continue their contacts, and in particular will put the set of suggestions referred to above to national and international sporting organisations. The meeting agreed that the different arrangements envisaged might take the form of special high-quality games to be held in different countries during August/September after the Moscow games. Participation would be open to all including those who had competed at Moscow. After thorough examination they believed that this approach had real prospects of success.

The meeting agreed that its guidelines be stated as follows: the special high-quality games should not be staged at the same time as any Olympic Games in Moscow; the various events should, if practicable, be held at or about the same time and preferably towards the last half of August 1980; the games should be staged at sites in a number of countries; the games should, if possible, be organised to allow for linked television coverage; the sports events should be held in accordance with the rules and regulations of the relevant national and international sporting associations; the games should be open to athletes from all countries and should not be represented as being in opposition to the Olympic movement.

At the same time the meeting emphasised that it was neither their intention nor their wish to be seen to be organising a ‘rival Olympics’. The meeting reaffirmed its belief in the Olympic ideal and the authority of the IOC, and stressed that its opposition was directed solely towards the continued insistence on Moscow as the place for the summer Olympics at a time when the Soviet Union continues to affront world opinion and United Nations resolutions.


– For the information of honourable members, I repeat what I have said here before, and that is that I believe, on the result of my visit overseas, that there will be an effective boycott of the Olympic Games. All members of this Parliament need to understand that I am saying that seriously and that it is based on the information before me. It is quite clear that one of the countries basic to this boycott is West Germany. There is no question of that. The United States position is reasonably clear at the moment in the sense that the executive of the United States Olympic committee has indicated that it will stand behind the President and that it will recommend to its plenary body on 14 April that that be its policy.

The Chancellor of West Germany has made it quite clear that it is up to Moscow to set in train a situation whereby Moscow can become a suitable site for the Olympics by 24 May, which is the date when the time for acceptances of invitations to Moscow expires. There is no chink of light anywhere- this can be confirmed by my colleague the Minister for Foreign Affairs- that the Soviets will get out of Afghanistan or will do anything to make Moscow a more suitable site. Therefore, it is quite clear at the moment that the West German Chancellor’s proposition will not be met in May and that the West German Government will be boycotting the Olympic Games and saying to its Olympic federation or committee that it should not go to the Games. The President of the West German Olympic committee said publicly while I was overseas that in his view he would expect his federation to follow the view of the Chancellor.

On that information and based on my discussions with the Minister for Sport in West Germany the result will be, I believe, that if the Soviet Union does not get out of Afghanistanthat seems highly unlikely- there will be a boycott by West Germany. I would therefore expect that, with the United States out, with West Germany out, with the possibility of other western European countries being out, with the Islamic countries by and large being out, with countries in South East Asia being out and with other countries in the Third World being out, there will be what is called an effective boycott. I hope that honourable members opposite will take note of that. I state it seriously because I do not believe that we could see our athletes in Moscow if the athletes of the countries I have mentioned were not there as well.

page 1114


Suspension of Standing Orders

Leader of the Opposition · Oxley

– I wish to move:

That so much of the Standing Orders be suspended as would prevent the Leader of the Opposition from moving:

That this House deplores the wilful and inexcusable misrepresentation of the costing of Labor’s job opportunities program by the Minister for Employment and Youth Affairs.

I expect that the Minister for Employment and Youth Affairs (Mr Viner) will want to take this by the tusks. It will give him a chance to prove himself. It is necessary to resort to this procedural motion as it is the only opportunity we really have in the House to correct the misrepresentation of -

Mr Viner:

- Mr Speaker, if the honourable gentleman wishes to bring about the suspension of Standing Orders without moving for the Suspension of Standing Orders and putting it to a vote, I am quite happy for the matter to be debated straight away.


-You will give leave?

Mr Viner:

– Yes.


Leader of the Opposition · Oxley

– by leave- I move:

It is necessary for us to move for a debate on this subject immediately so that we can test the veracity of the assertions of the Minister for Employment and Youth Affairs (Mr Viner) who today rose to spellbinding heights of exaggeration and literally lifted the alleged cost of our job opportunities program to 51,000m, a nice round figure with three noughts after the one. I suggest that given another two or three weeks he will have it up to $ 1,500m and $2,000m. I do not say that lightly. The indisputable fact, as verified by the record which I will produce in a few minutes, is that the Minister is prepared to say and do anything to exaggerate- hopefully in his view to the disadvantage of the Opposition- the cost of programs which are proposed.

He claims that the Community Service Corps will cost $600m, as against our costing of $ 100m; that the work program for male adults with dependants, who have suffered unemployment is $325m as against our $60m. Altogether, he gets it up to a nice round figure of about $ 1,000m. That is not a costing by an honest man. That is clearly not the costing of his Department. I assert now that the Minister is incapable of producing detailed figures, worthy of any credibility, at all to substantiate that assertion.

Mr Dawkins:

– He is a liar.


-Who am I to argue with profound insight?


-Order! The honourable member for Fremantle will withdraw.

Mr Dawkins:

– I withdraw.


-More than that, the Minister has had several opportunities to justify his exaggerated assertions and has declined to do so. His responses have been the thinnest, the most diluted imaginable. He does not want to justify his assertions because he knows that he cannot. Last year, and again this year, I telexed him seeking details of his costing allegations. After acknowledging the telex, among other things he said:

I would also expect that your advisers are able to make a similar costing to mine without wishing to check on my advice.

I therefore feel it is unnecessary for me to provide the detailed information requested.

The fact is that our expert advisers and sources outside of this Parliament- they are independent ones- refute as sheer hypocrisy and total humbug, the allegations of the Minister. They are, of course, qualities that sit easily upon his shoulders, but they are also qualities which ought to embarrass the Government. Again on 3 March, after I had sent him not one but several telexes courteously requesting that some regard be extended to my position as Leader of the Opposition in this Parliament and that the details be supplied, he again referred to the telex and said:

I publicly commented upon your proposal when it was first mooted by you last year. I refer to my press releases of 28 August and 4 September 1 979, copies of which are enclosed.

I have more to do with my time than to dwell on political graffiti. That is the standard of the Minister’s statement. I repeat, the Minister is not in a position in which he can justify his assertions. He is not in any position in which his allegations can be made to stand up in any credible way. They are not the allegations of an honest man. They represent the behaviour of a desperate man. Let me justify that with evidence of record. Mr Viner in a Press statement of 28 August 1979, referring to Labor’s Community Service Corps program, which he now says will cost $600m, said:

The Work Corps plan proposed by the Leader of the Opposition would cost Australian taxpayers more than $300 m a year.

Mr Hayden has claimed his scheme would cost $80m to $100m. While this is a large enough sum in itself, the true cost is more likely to be over $300m.

Mr Dean:

– Over.


– One would have to be pretty damned stupid to go from $300m to $600m and suggest that that was just a marginal miscalculation. On the honourable member’s performance in the House he could easily accept that as a persuasive proposition, but I do not think that many honourable members would. On 28 August 1979 the Minister said that it may cost more than $300m a year. On 2 September 1979, a matter of weeks later, the Prime Minister (Mr Malcolm Fraser), His Master’s Voice, said:

The total cost of employing Labor’s 50,000 people would be nearer to $600m a year.

That is a reference to the program about which we are talking. So faithfully, two days later, on 4 September, the Minister said:

As the Prime Minister said on Sunday, the total cost of the Hayden make work proposal would be nearer to $600m a year.

That was the faithful squeak of the Prime Minister’s spaniel. He is always ready to grovel away his self-respect. So there we have it. In a matter of days, the Minister is prepared to change his position from some $300m which in a full year would be closer to the gross cost of the scheme, to $600m to confirm what the Prime Minister had said. His veracity is always at stake in this House and never survives a challenge.

Fancy the key people in this Government, least of all this Minister and the Treasurer, who are responsible for costing casting doubt on any one’s costing calculations or forecasts on matters such as this.

I ask honourable members to look at the unemployment benefit figures alone. In 1976-77 the Government’s forecasts were $161m out. In 1977-78 they were $154m out. In 1978-79 they were $ 125m out. In three years they were $440m out. That is enough to put two FFG frigates to sea and keep them operational. That is the nature of the level of the cost miscalculations for which these people are responsible. They are not simple errors. Members of this Government work in reverse when they are putting their own costing forward because they are all massive understatements. No one in Australia believed, on the one hand, the Budget forecast that unemployment to go up but on the other hand that the allocation for the unemployment benefit was to go down. That was a thoroughly discreditable undertaking.

Of course, we all recognise the basis of it. In 1976 the then Treasurer, the present Minister for Industry and Commerce (Mr Lynch), appeared before the National Press Club on the Wednesday of the week when he presented the Budget and was challenged on some of the figures he presented in the Budget. He confessed, rather ashen facedly that they were rubbery figures, that there was rubber figuring. We all know now what happened. After the rest of the members of the Cabinet were shushed out of the room the Treasurer was taken in to the Prime Minister and he was told there would have to be ‘adjustments’. The figures had to be made more respectable. So there was a recalculation or representation that no honest man would have tolerated and that any self-respecting Treasurer would have resigned about rather than face the dishonour of such behaviour. That is the nature of the rubbery figuring. That is why the Treasurer then was able to cling to his office as Treasurer in the face of general despair in the community and condemnation of the way in which he was conducting the affairs of this country.

These people opposite have constantly rigged the books. Their record shows it. They rigged the books in regard to the unemployment benefit. They rigged them in the presentation of the level of the deficit by moving large amounts of money out of the deficit. For example, provision was made for money raised for instrumentalities to be raised outside the Budget as opposed to the practice that was always adopted by honest and candid government administrations. They were rigging the books then; they are rigging the books now. I ask honourable members to look at the cost of the programs of the Minister for Employment and Youth Affairs and at the level to which the forecasts have been out. In respect of the Special Youth Employment Training Program in 1978-79 the estimated numbers were about 14,000 below what he forecast. Under the Commonwealth Rebate for Apprentice Fulltime Training Program the numbers were about 28,000 below the number forecasted. That is a drop of 44 per cent on what the Government claimed could be achieved. Look at the appalling record in the SYEPT Program in 1977-78. This Minister estimated that there was a requirement for $ 18m and in fact expenditure was $47m. He was 160 per cent out. We are asked to believe that these people opposite are honest and competent bookkeepers. One does not make mistakes of that order in public accounting unless one is keen or determined to make them, or unless one’s objective is to deceive and misrepresent the position to the Australian public. Honourable members opposite do this to make the presentation of their budgetary exercise more acceptable than it should be, just as they misrepresent by exaggerating when they are seeking to disadvantage the Labor Party.

In 1978-79 under the SYEPT Program, 80,000 people were supposed to be trained. Actually 66,000 were trained. The cost to train 80,000 young people was supposed to be $80m. It cost $83m to train 66,000 people. How can anyone on the Government side seek to persuade the Australian public that anything he says in relation to costing or forecasts associated with training programs can be believed? The Government’s record would completely demolish any such claim.

There is another aspect of the Minister which is literally unbelievable. I refer to the casual way in which he throws around employment multipliers in relation to capital works programs in Australia. In September 1979 in relation to Roxby Downs he said there would be a capital investment of $2,000m involving 2,000 to 3,000 construction jobs, 5,000 permanent jobs and 50,000 additional jobs through the multiplier effect. That is a multiplier effect of 10 to one. Every economist I speak to and to whom I quote this falls over in a faint of disbelief. Yet the Minister expects us to believe it. There are people who have been less reckless but nonetheless reckless in their behaviour in the handling of public accounting who are serving time in gaol. This man expects to continue getting away with this.

A number of statements have been made in relation to the North West Shelf. For instance, one was that there would be a permanent work force of 800 with a multiplier effect leading to the employment of another 11,000 to 12,000 employees. That is an employment multiplier effect of 14 to one or 15 to one. No economist in this country believes that. They would not waste their time disputing the statement with the Minister because they think it is too dishonourable a proposition to be swallowed by anyone. Let me quote the results of some of the analyses which have been carried out by people like Hohnen and Kuehne, who are econometricians, in relation to mineral development in Western Australia. They say:

For the bauxite-alumina industry a conservative estimate would be a multiplier of three, which would indicate indirect employment of at least double that of direct employment.

A study by Mandeville and Jensen of the University of Queensland commissioned by the Queensland Government and Comalco showed that for direct employment of 1,080 in an aluminium smelter plant operation some 4,000 new jobs would be created. The multiplier effect is about four to one. I think it is generally recognised that I take a fairly keen interest in economic matters and that I read quite extensively. One of the areas in which I take an interest is that concerning the employment multiplier effects of capital investment in technologically advanced industry. No econometric exercise suggests that there would be a multiplier effect higher than three to one or four to one. Yet the Minister brazenly walks into this House and, casually leaning on the dispatch box, drops another lie saying that the multiplier effect is 15 to one on one project and 10 to one on another project. This is the man who is now seeking to distort and massively exaggerate the cost of our program. He likes to suggest that the Government’s approach to generating jobs will generate real jobs. Therefore the Government talks about mineral development projects which will get under way at some time, but not in the immediate future, and which will create jobs and therefore relieve unemployment.

We accept the desirability of tapping our mineral resources. We also accept the appropriateness of redistributing a greater portion of the wealth back into the community- back into the cities where people live, back into the rural areas where people live. In both instances that is where jobs are wanted, apart from the jobs that are generated in those development projects. But those projects alone will not generate a sufficient number of jobs to overcome unemployment in Australia. I ask honourable members to listen to this statement: In the North West Shelf development project every direct permanent job that is created will cost $4.3m. In uranium mining it will cost $650,000 to $700,000 for every direct permanent job that is generated. The cost for each direct permanent job generated at the Colonial Sugar Refining Co. Ltd coal project at Hail Creek will be $740,000.

Let us get this into some sort of context. The Minister says: ‘Leave it all to the private sector; leave it all to so-called market forces’, and all the nonsense that goes with that superstitious belief in a mythical hand guiding our destiny. The only mythical hand is the heavy hand of the corporate sector rigging the system to its advantage and to the disadvantage of a lot of people in this community. That is why we make no apologies at all about being prepared to intervene in the economy for the benefit of average men and women and their children in this community. Let us get it into context. The Government is going to rely almost exclusively on mineral development projects to overcome our problems and on capital works projects such as those approved late last year by the Loan Council meeting. It so happens that if one does the simple arithmetic one establishes, using the Government’s figures, that the cost of generating each direct job as a result of the Loan Council borrowings approved towards the end of last year is $130,000. In simple terms, that means that the cost of reducing unemployment to 2 per cent of the work force would be $50,000m, if one relied on the Government’s proposal. If one looks at that, $130,000 per job is a much more respectable ratio of direct investment per job by comparison with the cost of the North West Shelf project of $4.3 m and the cost of CSR Ltd ‘s Hail Creek project of $740,000 per job. We are talking about real job creation, not phoney, mythical propositions that will give nothing to the community.

There is another point with which I want to deal. The Minister says that a large number of jobs have been created in the last 12 months. That is true, but why have they been created? They have been created because of artificial circumstances which are on the verge of disappearing rapidly. If one looks at the national accounts one finds that there has been no growth in the economy, no stimulation for the economy, coming domestically. Domestic demand has been flat in that 12-month period. The growth has come almost exclusively from external factors and has arisen very largely because the Australian dollar has been artificially depressed, an artificial depression which has been sustained over a fairly lengthy period. That is about to blow itself apart for a number of internal economic reasons such as climbing inflation and climbing interest rates, which have arisen very largely because of Government mismanagement. What we are talking about is something that will really generate economic recovery that can be sustained and will create real job opportunities for people.

It is sheer nonsense, fiction, for the Minister suddenly to jack up the cost of our program to $ 1,000m. He does not stop for a minute to allow for the return to Government coffers of the massive savings on unemployment benefits in the first year of our program of $ 180m. The Government is prepared to spend $ 1,000m on unemployment benefits in the course of this year and not to blink an eyelid, to do as little as possible to generate real job opportunities, not just for young people but for adults too, who are despairing of ever enjoying the opportunity of joining in the work force in a productive and self-respecting way. It has no concept of the enormous personal and social distress, the loss of self-respect, of worthlessness, that people experience as a result of extended unemployment. I challenge the Minister to produce the evidence, which so far he has steadfastly refused to do, upon which he has drawn together the costing he so fictitiously presents to the Parliament.

We are prepared to spend money to create jobs for people. Our program will help the private sector and stimulate demand. More goods will be sold and more profit will be earned by employers, who will employ more people. That is the way to get the economy going. Let us not have any more of this deceitful nonsense the Minister and the Government like to try to propagate that this is not the way to do it, that this is the way in which the moral fibre, the personal mettle of people will be destroyed. Australia lags in spending, in trying to offset the problems of unemployment, which are very largely the product of unwise economic management. In 1979-80 the National Employment and Training Scheme, the Community Youth Support scheme, the CRAFT scheme, the employment program for unemployed youth will involve about $140m total expenditure, which is 0.12 per cent of gross domestic product. In West Germany 0.8 per cent of gross domestic product was spent to relieve unemployment with programs that genuinely create work. That would require about $ 1,000m expenditure in Australian terms. In Denmark 1.51 per cent of gross domestic product was spent, which would require $ 1,600m in Australian terms. Accordingly, what we are proposing is quite modest but is more than justified in terms of increased revenue, the savings on unemployment benefits, and the development of self-respect for people out of work.

I repeat: I challenge the Minister to be honest for a change and to produce the facts. I would be as shocked as other honourable members if he could do it. The challenge is too great. He seems to believe that nothing succeeds like excess.

Government members interjecting-


-Order! The Leader of the Opposition will resume his seat. There will be less interjection from my right. If there were less interjection from my right the Leader of the Opposition might be able to hear me trying to attract his attention. The honourable gentleman will withdraw what he just said.


-What was that? I said that the Minister believes that nothing succeeds like excess, and he has been excessive in his claims today.


-The honourable member will withdraw the remark. I will not repeat it.


– Whatever it is you say I have said and should not have, I withdraw. I will not -


– The honourable gentleman very well knows the terms he used.


– May I conclude the comments I was making. I challenge the Minister for once to produce the facts and the details, to give a little candour and display a little integrity. Those are great challenges for this Minister but ones that the House properly expects him to meet.


-Is the motion seconded?

Mr Young:

– I second the motion and reserve my right to speak.

Minister for Employment and Youth Affairs · Stirling · LP

– There has been a rather paltry effort on the part of the Leader of the Opposition (Mr Hayden) to try to bolster what I properly described in Question Time as proposals in which transparent sleight of hand was used, as I described it, in the efforts of the Opposition to present to the public the true cost of its proposals. I stand by the costings I gave at Question Time- in round figures, $ 1,000m. Let me repeat how that $ 1,000m is arrived at and why I properly describe the proposals as a transparent sleight of hand. At the end of the seven-page document the Opposition concluded by saying that the total cost in the first full year of operation would be $180m. What anybody knows is the truth of the matter on a reading of the document, is that there is a full year cost higher than the first full year cost of operation. One also knows, upon reading the document, that what the Opposition has tried to do is cloud the issue by describing the cost as the net cost. Yet as I said at Question Time, the Leader of the Opposition above all, as a former Labor Treasurer, even though it was in the dark disastrous days of the Whitlam Government, would know that when one is costing for budgetary purposes one costs on the basis of what is appropriated to the department which will spend the money. Quite clearly, the Opposition proposes to appropriate to its Australian Manpower Commission, which it said it was to establish, enough money to finance all its proposals. I say again, and I stand by what I say, that the true cost in terms of the amount which would be appropriated to the Australian Manpower Commission would be in the order of $ 1 ,000m. The Leader of the Opposition does not dispute that proposition because as a former Treasurer, he cannot dispute it. I repeat again what I said -

Mr Hayden:

– I rise on a point of order, Mr Speaker. I have already told the Minister that his costing is not only fallacious but dishonest. He is seeking to suggest that I endorse it. I could not imagine anything more distressing.


-Order! There is no point of order.


– I repeat the figures I gave this morning. Against a full year net cost for the Community Service Corps of $200m I put a true cost, as the amount required to be appropriated, at $600m. For the work program, against a full year net cost as proposed by the Opposition of $ 100m I put a true cost of $325m. For the private sector employment and training program I allowed a figure of $48m in lieu of $20m put forward by the Opposition. I add to that a figure for the cost of the apprenticeship proposals to increase the intake by 20,000 a year which, in the Opposition’s program, was not costed at all. So that is allowing some $2 7m. I would have thought that to be a modest sum for the additional cost by way of subsidy to employers and increased costs to technical and further education institutions for mounting such a program to increase the apprenticeship intake. The clear basis of the advice that I have received from an independent source -


– What is it?


– An independent source, the source upon which I rely at all times for the programs that I mount- my Department. We base this squarely on the comparison with the old and discredited Regional Employment Development scheme. Why do I do that? I ask honourable members simply to turn to page 5 of the document put out by the Opposition in describing the Community Service Corps. The Opposition gave these examples of projects on which young workers would be engaged. The document states: construction of community facilities such as parks, playgrounds and public sporting facilities;

Mr Baillieu:

– All RED scheme projects.


– Of course. Honourable members on my side of the House recognise quite clearly the old RED scheme by another name. The document continues:

Conservation and environment tasks in national parks,’ wildlife reserves and national trust properties and similar undertakings; service in public authorities, local governments and community organisations in clerical work, field work and practical administration;

If that is not a description of the old RED scheme I do not know what is.

Mr Bourchier:

– Who abandoned it?


-Who abandoned it, as the honourable member for Bendigo asks? It was the Leader of the Opposition (Mr Hayden) when he was the Labor Treasurer in his August 1975 Budget after it had cost the Labor Government of the day $ 1 83m by way of true cost, not net cost as honourable members opposite now assert. Now let us look at it this way. An evaluation was undertaken of the old RED scheme in 20 selected Commonwealth Employment Service areas. That study estimated that the cost a man week averaged $195 and that included wages, wage related expenses, such as workers’ compensation, transport and accommodation, materials and equipment, hire costs as well as the expenses associated directly and indirectly with the supervision of an administration of the scheme. Since 1974-75 it is estimated that wages have increased by about 50 per cent. Using that escalation factor it is reasonable to assume that today the cost a man week would be approximately $300. If we make an adjustment for the fact that the Opposition is now talking about young people, we could reduce that to, say, $270 per week or $ 14,040 a participant a year because that is what the Opposition has said it will do; it will provide work for 50,000 people for the year.

Let us take these proposals at face value. If the Opposition is not going to offer these people a full year’s work then let the honourable member for Port Adelaide (Mr Young), when he speaks, deny it or is the Opposition going to do what it did under the old discredited RED scheme, giving to the participants an average of 15 weeks work? That is all they got under the RED scheme. Where does the Opposition now stand? Is it going to give 50,000 people a year’s work or is it going to give 50,000 people during the year 15 weeks work? I think the Opposition ought to answer that question. On the basis that it is going to employ everybody for a year as it says in its proposals, the gross cost of the Community Service Corps on the figures that I have given would, in fact, estimate out at about $700m. I have been conservative in allowing the Opposition an amount of $600m. On the same basis, the work program which again is another RED scheme simply with another title, would cost something of the order of $325m a year.

Let us come to the private sector employment and training program which really is the most inadequate program of all of these proposals. What is said is that this will replace the Special Youth Employment Training Program and provide employment in and training for 30,000 jobs. That is intended to replace 40,000 people who are presently being assisted by the Special Youth Employment Training Program. That, the Opposition says, is at a cost for its program of $20m more than the $28m the Government is presently spending on SYETP. Let us bear in mind that this private sector employment and training program is said to be by way of subsidy for additional employment taken on by the employers of Australia. What have we, in fact, experienced in the last 12 months? We have experienced growth in the labour force of 139,000 of which some 70,000 are in full time employment. That is an addition to the work force within the private sector at no cost to the taxpayer. This is the real point of it. This is the real fallacy of this job creation program which the Opposition has put forward.

The Opposition is asking the taxpayers of Australia to subsidise the growth in employment within private enterprise which is already occurring at no cost to the taxpayer. It is going to help fewer people than are presently being helped by this Government’s Special Youth Employment Training Program. In fact, the subsidies that will be offered under the private sector employment and training program will in fact be less than we are now offering under our Special Youth Employment Training Program. So really I ask the

Leader of the Opposition to go back to his drawing board, or perhaps it is the drawing board of the former Manager of Opposition Business in this House, the shadow Minister for Employment. Maybe the program of the Leader of the Opposition has been pulled out of the honourable gentleman’s book. On top of that, as I have pointed out, the Opposition has made no attempt to cost its apprenticeship scheme.

The Opposition seeks to criticise me for estimates that I have made of the multiplier effect of direct employment created in such major development projects as the North West Shelf and, prospectively, at Roxby Downs. I stand by the projections that I made in both of those projects. If there is one thing that I as a Western Australian have learnt and that other Western Australian members of this House have learnt from major resource development in Western Australia under a Liberal Government it is that that kind of development creates real jobs and creates them in places where previously there was no work. One has to look only at the Pilbara. Ten, 15 or 20 years ago there was no Mt Newman, no Goldsworthy, no Karratha and there was no Dampier. Is the Opposition trying to say now that the development of the iron ore fields of the Pilbara has created no jobs beyond those at the actual mine site? Is it trying to tell the people of Australia that mining of copper and other minerals at Mount Isa has created no more jobs than those at the actual mine site? Is it going to tell the people of Western Australia that the development of the North West Shelf natural gas deposits will create no more jobs than those at the site where the gas is drawn out?

Let us look at this as realists. We on this side of the House do look at it this way, but we know that the Opposition is not prepared to recognise the reality. I invite any member of the Opposition to go to Western Australia to see what has occurred there and then to answer the question: Will the same thing occur if the great Roxby Downs deposits are developed? Let me remind the House of the sorry record of the former Whitlam Government of which the Leader of the Opposition was the Treasurer.

Mr Baillieu:

– Spare us, please.


– No. I will not spare the House this information because it bears repeating time and time again so that it is driven very firmly into the minds of the Australian public. Between August 1973 and August 1975 the number of unemployed looking for full time work shot up from 67,200 to 215,500, an increase of 210 per cent. What were the policies of the Labor

Government of the day? Its policy was simply to spend more and more of the taxpayer’s money. If that was the answer to the problem of unemployment we would not have a growth in unemployment from 67,200 to 215,500 in 12 months. If its economic logic was correct we would not have had any unemployment. But we know from sorry experience that the product of massive government expenditure leads only to one thing, that is, rampant inflation, which in turn leads to gross unemployment. Between 1973 and 1975 that was the experience of the Australian public.

In an answer to a question earlier today- I take my words from the document put out over the weekend- I said that the programs announced for job opportunities ‘will operate in the altered economic climate created by other measures of economic expansion, particularly those of fiscal stimulation and an expanded capital works program’. If we added to the $ 1,000m that I have already mentioned the gross public expenditure which would be necessary to produce fiscal stimulation and an expanded capital works program and if, heaven forbid, the Labor Party came into government in 1980-81, we would have rampant inflation and even higher unemployment than we are now experiencing.

In line with the growth in employment of 139,000 over the last 12 months, we have seen month after month over the last few months the level of unemployment being lower than the level in the corresponding month of 1979. I firmly expect that, with continuing economic strength already apparent in the economy, we will continue to see our unemployment figures drop month by month as this year goes on. That is a much better record than the Labor Government ever had.


Order! The Minister’s time has expired.

Port Adelaide

-The Australian Labor Party is proud once again to have provoked a debate on the all important issue of employment which this Government refuses to allow the Parliament to debate. We are debating the subject today because the Labor Party had the courage and foresight to present to the Australian people last Sunday the most comprehensive manpower package for putting people back to work that has been presented to Australians since World War II. In the light of the way the Minister for Employment and Youth Affairs (Mr Viner) has spoken it would be a good idea in future when Ministers are speaking to have a lie detector present so that we can see when a Minister is telling the truth and when he is telling lies.

Mr DEPUTY SPEAKER (Mr MillarOrder!

Mr Yates:

– I ask that that be withdrawn.


-Order! The honourable member for Holt will resume his seat. The Chair has the matter in hand. The honourable member for Port Adelaide will withdraw that very strong inference.


-About the lie detector?


– I request the honourable member not to compound his offence by repeating the expression on future occasions.


-Mr Deputy Speaker, I withdraw it. Let us look at a couple of matters with which the Minister has been associated. Prior to the Western Australian elections a few weeks ago the Minister, in order to assist his colleagues, which is fair enough in politics, put a statement in Business Scene listing the 22 projects which he said were to be developed in Western Australia. Following a report in the Press in Western Australia, my colleague the honourable member for Fremantle (Mr Dawkins) asked the Deputy Prime Minister (Mr Anthony) certain questions about these projects. Honourable members will be surprised and astounded to know that the Deputy Prime Minister gave quite different answers to the views that were put forward by the Minister for Employment and Youth Affairs (Mr Viner). For instance, the Minister said in a Western Australian newspaper that there would be 1,000 jobs at the Alcoa project. The Deputy Prime Minister is reported in Hansard as saying that there would be 500 jobs. The Minister said in a Western Australian newspaper that there would be 2,500 jobs at the Alwest project. The Deputy Prime Minister said that there would be 2,000 jobs. The Minister told the Western Australian electorate that there would be a thousand jobs at the Mount Newman project. The Deputy Prime Minister said that there would be 800 jobs. The Minister said that 800 jobs would be created at Robe River. In reply to a question on notice, the Deputy Prime Minister is reported in Hansard as saying that there would be 400 jobs. This Minister cannot be believed.

I will reiterate what the Leader of the Opposition (Mr Hayden) said in his contribution to the debate. In a Press statement of 28 August 1979 the Minister for Employment and Youth Affairs had this to say:

The Work Corps plan proposed by the Leader of the Opposition would cost Australian taxpayers more than $300m a year.

Mr Hayden has claimed his scheme would cost $80m to $100m. While this is a large enough sum in itself, the true cost is likely to be over $300m.

A few days later, on 2 September, the Prime Minister (Mr Malcolm Fraser) made this statement:

The total cost of employing Labor’s 50,000 people would be nearer to $600 m a year.

On 4 September the Minister for Employment and Youth Affairs, not to be outdone, said:

As the P.M. said on Sunday -

The Minister is always willing to bark for the Prime Minister- the total cost of the Hayden make work proposal would be nearer to $600m a year.

If this is a serious debate, I put it to the House that on the record of what has been stated inside and outside this Parliament by the Minister for Employment and Youth Affairs it is obvious that he is not intent on having a serious debate about the cost of Labor’s program; nor is this Government interested in seeing that the people of Australia understand the crisis of unemployment as we now have it.

I refer now to the Minister’s remarks about the discredited Regional Employment Development scheme that was in existence in Australia in 1974-75. It might be of interest to honourable members to know that this Minister put in submissions from his own district so that he could utilise the funds of the Regional Employment Development scheme. He wanted people in his district to be working under that scheme. During those years, every member of the Liberal and Country parties went to the then Minister, Mr Cameron, and said: ‘Please spend some money creating jobs in my electorate’. In 1974-75, every member of the Liberal and Country parties thought that the Regional Employment Development scheme was a good scheme. After Sir John Kerr had done his trick of sacking the Government on 1 1 November the then Minister for Employment and Industrial Relations, Mr Street, made a promise to the electorate, which has been publicly recorded, that the Regional Employment Development scheme would be reintroduced by a Liberal government. There should be no nonsense about where the Government stands when it is telling the people at election time what it will do about job creation.

The Minister for Employment and Youth Affairs boasts about jobs that will be created in Australia. Let us look at the situation in his home city of Perth. In Perth there are 39 young people out of work for every job vacancy available; that is, a ratio of 39:1. Today the overall vacancy ratio is 43:1. The Minister does not care about those sorts of figures being quoted to him. What he has to try to do is to persuade the Australian people that unemployment is no longer a major issue. He is not the government spokesman who told us in 1975 and 1977 that there would be jobs for all those who wanted to work under the Liberals. It is not just the number of people out of work that gives the Australian Labor Party cause for concern; it is the period that those people are out of work. The Labor Party does not put up these policies as a joke or because it has nothing else to do. It puts them up because it is concerned about the crisis that is affecting at least 7 per cent of the Australian work force. There are 470,000 people out of work and searching for employment.

The Minister for Employment and Youth Affairs was put in his present position after his predecessor- a more honourable Minister- was sacked for telling the Parliament the truth when he said that if we created 130,000 jobs over the next five years we would get our unemployment figure down to 5 per cent of the total work force. The present Minister does not talk in terms of getting the figure down to 5 per cent or 6 per cent. He does not tell the school children of Australia what jobs will be available in the mid-1980s and late 1980s. He does not tell the people going to the colleges what they ought to be trained to do and what profession will be available. He will say that the Government should not interfere. He will send his immigration officials wandering around North America and Europe to persuade and influence migrants to come to Australia as tradesmen but he will deny the training to Australian youngsters who have the qualifications to undergo that training and who would love to be skilled tradesmen in this country. The Minister and his Government would prefer to bring in migrants to do skilled work rather than train young Australians. In all the time that the Minister has been mealy-mouthing the policies of this Government he has never said that we do not have enough young people in Australia to do the skilled work required by industry. There are many people with educational qualifications to do the skilled work necessary in Australia. The Australian Labor Party gives this pledge to the Australian people: We will train young Australians. We will cut back the immigration program of skilled labour and we will train young Australians to do the jobs that are required in Australia.

It is not just a matter of the total number of people unemployed. Let us look at the duration for which people are unemployed and relate that to what we said on Sunday about people who can work under our schemes. As of January 1 980 people between 15 and 19 years of age are now out of work, on average in Australia, %Vi weeks. People between 20 and 24 years of age, 28 weeks; between 25 and 34 years of age, 23 weeks; between 35 and 44 years of age, 33 weeks; and between 45 and 54 years of age, 40 weeks. If a person is unfortunate enough to lose his job once he has reached the age of 55 then he can expect to be out of work and searching for new employment for 44 weeks. This does not matter to the Government. In the Liverpool area on the outskirts of Sydney, 96 young people are out of work for every job vacancy.

This Government can talk all day about the exploration and the development of iron ore in the Kimberleys, about the North West Shelf and the aluminium industry. All of us welcome the development. We might argue about who owns the development, but we welcome it. Not one of those projects nor all of them put together will put back to work all the Australians who require employment. The real argument in Australia today is whether the resources of this Government- a Federal Government- should be utilised to put some people back to work. What we are asking is that 0.56 of one per cent- $ 180m- of total Budget outlays be used as a first step to start putting people back to work. There is no Government agency that can give us the advice we need. Organisations such as the Brotherhood of St Laurence and St Vincent de Paul tell us- the information is available to the Government- that if we do not get people into work after they have been out of employment for three months we will face a serious social consequence in this country.

Time and time again we have pledged ourselves to work with any Government committee that the Government would like to establish to look at the social costs of employment, drug abuse, alcoholism, crime and the health deterioration that occurs as a result of unemployment. This Government says no. It says blankly: ‘No. we are not going to do it’. It is not concerned with what jobs may become available. The honourable member who will follow me went to the extent of saying that the group within the Catholic Church, which put out its booklet on unemployment, was a group of Marxists. That is the Government’s answer and its contribution to a serious debate on a matter of unemployment. The best thing the Australian Labor Party did this year was announce on Sunday its policy on unemployment. This shows that at least one of the major parties is serious about finding jobs for people of all ages in this country who are unfortunate enough to find themselves out of work.

It may be of interest to taxpayers to know that today, under this Government’s policy, we are paying out $ 1 billion in unemployment benefits. Three years ago who from the Government side would have said: ‘We cannot increase unemployment benefits by $500m’. That is what the Government has done. No one asked then where the money was coming from and how the Government was going to pay for the benefits. By one means or another this Government has found an additional $500m to pay unemployment benefits. Every taxpayer in Australia now pays $181 towards the Government’s debt in paying unemployment benefits. I think a lot of taxpayers would prefer to contribute their $181 to creating some jobs for those people to do.

A lot of constructive and good community work was carried out as a result of the Regional Employment Development scheme. It is true that a lot of the bureaucrats in the Public Service found that the Regional Employment Development scheme was new. It is true that a lot of people in the Department of the Treasury did not like it. But they are not the Government. The Government has got to create the policy and the public servants are there to carry it out. We tell the Public Service that, on becoming a government again, we will intervene with the resources of the Federal Government to spend this amount of money as a first step towards putting people back to work. We are not going to waste the taxpayers’ money at $181 a head- which is the cost now- to pay unemployment benefits because that is a death wish that the Government now brings upon us.

The Minister referred to the Special Youth Employment Training Program, and said: ‘Well, perhaps the Labor Party policy will not keep people in jobs for very long’. The Minister, under the Special Youth Employment Training Program, put people in the Public Service for 1 7 weeks of training and asked them what they were doing. I will tell the Minister what they are doing. They are emptying ink wells and making tea. That is the extent of their training under the Special Youth Employment Training Program. The Minister came into the House last year to protect some of these supporters and said: ‘We have got to change the guidelines of the SYETP scheme because employers are working a rort on the scheme’. Quite legitimately we said ‘What are the rorts? Let us have a look, not only at the rorts, but also at the employers who are carrying them out’. But the Minister will not say anything about them. His job is to discredit job creation. It does not matter how it is done; he has got to discredit it.

Honourable members should wait and see what promises are made later this year by the Government when we come to an election. Brother, can the Liberals tell some lies when an election is coming. The Liberals said: ‘We will maintain Medibank. We will have wage indexation. There will be jobs for everybody. All you have to do is vote for us’. They will say anything at election time. But between elections there is no performance. According to the figures that were released this morning by the Minister’s Department, we have 470,000 people who go to the trouble of registering at Commonwealth Employment Service offices. His only answer to that was to say: ‘We created 130,000 jobs in the last financial year’. That has got the figure down 1 7,000 less that it was last year. But that does not include the 74,000 people who we now call discouraged workers and who have dropped out of the work force altogether. This Government’s policy has been an absolute disgrace. When the Minister gets on his feet to try to use figures and alarm people about the amount of money that is going to be spent, we can tell the Australian people- it is a clear alternative to the Government’s policy- that we will spend, as a first step in job creation programs, 0.56 of 1 per cent of total Budget outlays to create jobs and put people back to work. That is a policy that the people will accept.

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


-We have just heard the usual speech from the honourable member for Port Adelaide (Mr Young) who is the proud author of a book called / want to Work. On the cover appear the words ‘Mick Young’ and then towards the bottom the words ‘positions vacant’. I read the book over the Christmas break. Certainly the honourable member’s position was declared vacant shortly afterwards by the Leader of the Opposition (Mr Hayden). The introduction to the book states:

It is not about economics; it is about people.

I would have thought that economics which was not about people was not good economics. The only things we get from the Opposition time and time again are diatribes about what it thinks ought to be done about situations without any regard for fundamental causes, costings or consequences. I invite the House to look at the record of what happened at the time the Opposition had control of these matters. I invite the House to consider that in the two years from August 1973 to August 1975 the number of unemployed people looking for full time work went up by 2 10 per cent from 67,000 to 215,000. The Labor Government had a miserable record of so-called creation of jobs by whatever standards when we look at the number of employed people over the two-year period from August 1973 to August 1975. The total number of employed people in the labour force, full time and part time- I emphasise that this is the Public Service and the private sector- increased by 58,300.

I invite the House to compare that situation with what happened in the single year to January 1980 when total employment rose by 139,200. The promises that the Government made in 1975 and again in 1977 have been pursued vigorously since the Government returned to office. The effects of those policies are starting to show. It is just when the effects of those policies are starting to show that we have the most nonsensical set of proposals put forward by the Opposition which would repeat the economic mistakes made by the Whitlam Government. If any honourable member wants proof of that fact, all he has to do is look at the book written by the honourable member for Port Adelaide entitled / want to Work. It is not very expensive. It is still available in the bookshops. There are plenty of copies remaining. If anybody wants to see what disasters would occur, he has only to read that book. The Age newspaper of Tuesday, 25 March, says this about the Labor program:

The main question clouding Labor’s policy is its cost. At first sight, the figure quoted - $330m net over a full yearseems far too low for a package which promises to create 100,000 jobs.

I repeat the words ‘seems far too low’. The Age also refers to the Regional Employment Development scheme, to the possible offsetting of savings and so on. Its article goes on to state:

Even so, one may be sceptical. The RED scheme in 197S ended up costing two to three times as much as the base wages of those employed under it.

The Australian Council of Local Government Associations has had something to say about this scheme over the last 1 8 months. After the experience of the RED Scheme, it put forward a carefully costed proposal to relieve unemployment by increasing the funds flowing through local government. It estimated the cost of each job, including supervision and materials, at some

SI 6,000 a person in a full year. That was the Association’s costing. On the basis of this costing, to provide jobs for 70,000 people under that scheme, it would cost- I ask you, Mr Deputy Speaker, and honourable members to wait for the figure- $1.12 billion. It would cost $l,l20m to provide 70,000 jobs under the scale proposed by the Australian Council of Local Government Associations, which represents councils of all political persuasions. That proposal has been considered very seriously. Of course, it is enormously expensive.

I have looked at the proposals which have been put forward by the Leader of the Opposition with the economic assistance of the honourable member for Port Adelaide, which assistance shows through the whole document. I notice that the proposed Community Service Corps would cost $200m in a full year when fully operational and would produce 50,000 jobs. The work program would cost $1 10m in a full year and would create 20,000 jobs. So the total number of jobs which it is aimed to create under these programs- 70,000 in a full year- under Labor costings would cost a total of $3 10m. I invite honourable members to carry out some elementary arithmetic. The average cost per job under the two full job programs- not the subsidy programs for private enterprise- is $4,429. That is the average cost that honourable members opposite expect to pay to be able to employ a person for a full year including supervision and, presumably, the cost of additional materials. Quite honestly, how could anybody possibly criticise the response of the Minister for Employment and Youth Affairs (Mr Viner) in the face of these figures?

The Minister has clearly gone through all the aspects of implementing such a scheme. He has at his disposal all the evidence that was collected when the Whitlam Government’s RED scheme was introduced and all the experience that derived out of the failure of that scheme. All this information is available to the Government and, indeed, to the Opposition. But the honourable member for Port Adelaide, in advising the Leader of the Opposition, clearly does not wish to look back on that particular episode. Indeed, the Age newspaper has drawn our attention to the absurdity of not looking back and learning from that experience. So outrageous is the motion put forward by the Opposition today that I propose to move an amendment to it. I move:

That amendment is seconded by the honourable member for La Trobe (Mr Baillieu). I think we have to get to the basis of this whole -

Mr Holding:

-I raise a point of order, Mr Deputy Speaker. By implication, the amendment raises allegations of a personal kind directed towards the Leader of the Opposition. Surely such allegations ought to be contained in a substantive motion moved in its own right rather than be contained in an amendment in a debate of this kind. I also argue that the amendment is a negative of the motion moved by the Leader of the Opposition.


-The Chair has considered the question of the .amendment being a direct negative of the motion moved by the Leader of the Opposition and sees it as not being such. The Chair also does not see the amendment as being a personal reflection on the Leader of the Opposition. Therefore there is no substance to the point of order. I call the honourable member for Mackellar.


-I will read out the amendment once again. It states:

That all words after ‘That’ be omitted with a view to substituting the following words: ‘this House deplores the misrepresentation of the Leader of the Opposition for failing accurately to cost the ALP’s job opportunities program, and thereby imposing a cruel hoax on those people seeking employment ‘.

Let us get to the basis of these proposals. Generally, they contain the term ‘creating employment’. This is a term which the honourable member for Port Adelaide and the Leader of the Opposition have used consistently in this Parliament ever since they were kicked out of office, basically for failing to create employment in Australia. The Government firmly rejects proposals to create jobs by expanding the Government payroll or by commissioning public works that are not economically justified. Such programs might create jobs in the short term in the public sector or with private firms engaged on government contracts, but every job that is created with such fanfare by such programs is lost quietly and with disillusionment in every small shop and every small factory throughout the nation.

Direct government spending is a commonly proposed solution. It sounds simple. However, it ignores the effects of higher government spending. If a government spends more it must raise taxes or it must borrow from the public. If people pay higher taxes or buy government bonds they have less to spend or to invest in the private sector. Thus the jobs gained in the government service or by contractors on government projects are lost elsewhere in private enterprise, which provides three out of four jobs in Australia. In 1974-75, 100,000 new jobs were created in the public sector by the Whitlam Government in much the same way as is now being proposed by the Leader of the Opposition. In the same year 155,000 jobs were lost in the private sector. A number of factors combined to bring about that situation, but high government spending was the major influence.

All I can say is that it is an absolute hoax to suggest that we can somehow buy all these extra jobs with government money. From where would the money come? The money has to come either from taxes or from borrowing. If it comes from taxes it comes out of people’s pockets; they then have less to spend on other things and that reduces the jobs in the small shops and small factories. There is nothing clever about this deduction; it is basic economics. As the honourable member for Port Adelaide does not believe in economics, he has not done these sums. Most people in the community fully understand that if we just create a public job on the public payroll which has no obvious economic benefit, the money comes from taxes or from borrowing. That money cannot be used anywhere else and jobs are thus lost in small shops and small factories. They are lost quietly. There is misery behind the scenes. This happens only 12 months after the public fanfare when politicians have come forward and promised a whole lot of new jobs with massive public spending. What happens in the front of the shop or the factory happens today; what happens in the back of the shop or the factory happens in six or 12 months time. That is what happened under the Whitlam Government. Today we are being treated to another dose of that Government’s philosophy.

Let me say something also about the contribution of the Opposition and the trade union movement to unemployment. If there is one additional factor over and above economic growth which will create extra jobs in the private sector, it is a relaxation of union enforced restrictions. Every time that the Conciliation and Artibration Commission sits down with unionists and employers and gives increases in wages which are not matched by productivity, or changes awards to restrict conditions of employment to make it more expensive and more complicated for employers to employ, more people are thrown out of work. This has to change. It is a change which cannot be forced on this system by the Government under the existing Constitution. It has to be recognised by people who are in jobs that every time there is a change to an award which has the effect of restricting employment, many of their fellows are thrown out of jobs.

There are only two real ways of improving employment opportunities in Australia. The first is to ensure that we have economic growth, and largely this is happening. The second is to ensure that, when that economic growth occurs, its benefits are spread more widely. That means that we must have industrial awards which spread employment and do not restrict it. All I can say is that in all my time as a member of this House I have heard nothing from the Opposition, from the honourable member for Port Adelaide or from the Leader of the Opposition about the restrictive effects of awards on employment or about restrictive practices which are adopted by unions and which put people out of work not only in the short term because of strikes but also because they squeeze people out as a result of labour becoming too costly. We all know what happened in the clubs and pubs a few years ago when people were squeezed out of work because overtime and penalty rates went up. We must realise that economic growth and a flexible labour market are the things which will bring us jobs. We cannot buy our way out of the situation with public money, with taxpayers’ money, because if we try to do so that money will not be available to be spent in the shops, on the factories and in the small places around Australia which contribute enormously to our employment and which in the last 12 months have pushed employment up by 139,200.


-Is the amendment seconded?

Mr Baillieu:

– I second the amendment and reserve my right to speak.

Melbourne Ports

-In speaking against the amendment, I say that this Government stands condemned-

Motion (by Mr Bourchier) put: That the question be now put. The House divided.





That the question be now put. The House divided. ( Mr Deputy Speaker Mr P. C. Millar)

AYES: 78

NOES: 34

Majority……. 44



Question so resolved in the affirmative. Question put:

That the amendment (Mr Carlton’s) be agreed to.

The House divided. (Mr Deputy Speaker-Mr P. C. Millar)

AYES: 79

NOES: 35

Majority……. 44



Question so resolved in the affirmative.

Original motion, as amended, agreed to.

page 1128


Minister for Industrial Relations · Corangamite · LP

– Pursuant to section 30 of the Stevedoring Industry Finance Committee Act 1977 I present the annual report of the Stevedoring Industry Finance Committee 1 979.

page 1128


Minister for Education · Farrer · LP

Pursuant to section 12 of the Non-Government Schools (Loans Guarantee) Act 1977 I present the annual report by the Schools Commission on the Non-Government Schools Loans Guarantee Scheme 1979.

page 1128


Ministerial Statement

Prime Minister · Wannon · LP

– by leave- I thank the House for granting me leave to make a statement on the subject of the talks I had in Wellington with the Prime Minister of New Zealand, the Right Honourable R. D. Muldoon, on Thursday and Friday of last week. I was accompanied on my visit to Wellington by the Minister for Special Trade Representations, Senator Scott, and a number of Australian officials. On the New Zealand side, in addition to Mr Muldoon and Mr Talboys, the Deputy Prime Minister and Mr Templeton, the Minister for Customs, a group of New Zealand officials participated in the talks. The meeting arose out of earlier discussionsoriginally a discussion with Mr Talboys at ‘Nareen’ and discussions last year with Mr Muldoon at the Commonwealth Heads of Government Meeting in Lusaka. In those earlier discussions we agreed that our respective officials would make a preliminary but wide-ranging study of prospects for establishing a closer economic relationship between Australia and New Zealand and that there should be a further prime ministerial meeting in the early part of this year to review the outcome of that study.

Our discussions in Wellington last week ranged widely over the trans-Tasman economic relationship, but the principal matter we considered was whether there was a basis for a new, closer trading relationship between the two countries. The existing New Zealand-Australia Free Trade Agreement- NAFTA - has promoted considerable growth in trans-Tasman trade over the last decade and a half, but it has become apparent over the last few years that further progress in stimulating trans-Tasman trade within the NAFTA arrangements is becoming increasingly difficult to attain. The alternatives, then, were to leave NAFTA as it is, which would have some unsatisfactory features for both sides, or to try to find a new approach. During the Commonwealth Heads of Government Meeting in Lusaka in 1979, we agreed on the latter course and officials began work aimed at identifying what kind of new approach might be to the mutual benefit of both countries.

Both Australia and New Zealand have been facing a difficult world economic environment and both governments accept that to establish a sound basis for economic growth in the years ahead their economies will have to be strengthened and their industries made more competitive on world markets. If the two countries can co-operate more closely in their own trading relationship, with each concentrating more on what it can do best, it will help both countries to grow stronger and to compete in wider markets. We agreed in Wellington that any closer economic relationship must be outward-looking, helping to strengthen our trading relationships with third countries, particularly in the South East Asian and Pacific regions.

The preliminary work done since our Lusaka meeting indicated that, if appropriately structured, a new, closer trading relationship could assist those broader objectives. It emerged that a move towards a full customs union with Australia, with its broader industrial base, would be too great a step for New Zealand at this stage.

On the other hand, a modified NAFTA agreement was not enough to ensure benefits for Australia. Australia is seeking arrangements involving a commitment to move towards duty free and import licensing free entry to the New Zealand market. What emerged, therefore, was the outline of an approach for moving to a closer trading relationship structured to meet the concerns of both countries. In our talks last week in Wellington we agreed that any move towards liberalisation of trade across the Tasman must necessarily be gradual and progressive to allow industries on both sides time to adjust and to become more competitive. The objective would be the reduction and, desirably, the elimination of all barriers to trans-Tasman trade on all goods produced in either country, over a reasonable period of time.

Mr Muldoon and I agreed on broad principles for the further development and diversification of the economic relationship, and on guidelines within which officials will now set to work to study the techniques, methods and detailed arrangements by which the two governments might proceed to implement progressive moves towards a closer trading relationship.

I should say that the agreements that the Prime Minister and I came to followed very detailed work by officials of both Governments, which had been supervised through ministerial meetings held from time to time and by government consideration of the matters involved. As a result of our own Government’s more recent examination, which was the basis for the discussions in Wellington, officials had met before the talks with Mr Muldoon to seek some small modifications in the work that had been undertaken hitherto- modifications nevertheless which the Australian Government believed important if there were to be an equitable movement towards a more outward looking trading relationship between New Zealand and Australia.

The study that has been commissioned will have to address a number of complex matters, including the treatment of cases in which industry inputs are protected in one country but not in the other, the impact of agricultural support or stabilisation measures on trans-Tasman trading opportunities, and the implications of the two countries’ export incentive arrangements. I would like to amplify one or two aspects of that statement. I refer, for example, to the treatment of intermediate goods- goods which may have a significant input from perhaps such low cost places as Taiwan, China or Hong Kong and which involve part processing in either New Zealand or Australia and then exportation to the other country. If intermediate goods produced in one country are fully processed in anotherwhich ever way it goes- there could be problems for the trans-Tasman partner in which production is fully consummated. In that regard, officials will have to undertake a very careful examination of the consequences for industry in both New Zealand and Australia.

Another aspect on which examination by officials will be needed is the impact of agricultural support or stabilisation measures on transTasman trading opportunities. Some of the stabilisation measures include elements of Government support and some include subsidies- consumer subsidies or direct subsidies to producers- and one of the tasks of officials will be to analyse whether those particular measures give one country or the other an enhanced and greater capacity, maybe an unfair capacity, to compete. If so, in the relationships which we pursue, that unfair advantage will have to be isolated and handled in an appropriate way. I am only pointing out that on both sides we recognise that there is much to be done and that there are problems to be overcome to achieve the advantages that we recognise as lying open to our two countries. I repeat that much remains to be done to overcome particular problems along the way and to ensure equitable treatment for industries in both Australia and New Zealand. The principles which were agreed in Wellington are set out in a communique issued by Mr Muldoon and myself on 21 March. I seek leave to have that incorporated in Hansard for the information of honourable members.

Leave granted.

The document read as follows-

Australian New Zealand Economic Relations


Communique by Prime Ministers

At the invitation of the Prime Minister of New Zealand, the Right Hon. R. D. Muldoon, the Prime Minister of Australia, the Right Hon. Malcolm Fraser, visited Wellington on 20-2 1 March for consultations on the prospects for establishing a closer economic relationship between the two countries.

The two Prime Ministers began their talks with a review of the extent of existing co-operation across the full range of the relationship.

It was clear from this review that Australia and New Zealand had developed a close working relationship based on a common language, a shared tradition of democratic government, and free interchange of their peoples. They already had the habit of co-operation. In addition, they were each other’s largest markets for manufactured goods as well as increasingly important markets for a wide range of other products, including agricultural and horticultural produce, and close links existed between the financial, commercial and service sectors. These factors were all evidence of the existence of a special economic relationship.

In the light of their review the Prime Ministers believed it was timely for Australia and New Zealand to take the special relationship between them a step further. The Prime Ministers agreed that an appropriately structured closer economic relationship would bring benefits to both countries and improve the living standards of their peoples. They believed that this could be achieved in a manner consistent with their obligations to the developing countries of the region, enhancing their prosperity as well as that of Australia and New Zealand.

They noted that while NAFTA had promoted significant growth in bilateral trade since the mid- 1 960s, the Free Trade Agreement in its present form did not seem to be providing sufficient impetus to the kind of co-operation which would best serve the interests of the two countries in the changing international economic environment.

The Prime Ministers therefore agreed on a framework for further detailed exploration and examination of possible arrangements for a closer economic relationship. An outline of the basic approach and scope of these studies is contained in .he accompanying annex.

These studies would be set in train immediately and would involve close consultations in Australia and New Zealand with interested parties including Australian State Governments. Until these consultations had been taken to a further stage, a firm timetable for taking the necessary decisions could not be set. In the meantime, the Prime Ministers announced that the existing Agreement on Tariff and Tariff Preferences between Australia and New Zealand, which was due to be reviewed on 30 November 1980, shall continue unchanged for a further period of at least one year.

The Prime Ministers expressed their commitment to an outward-looking approach, based on an efficient allocation of resources. They agreed that any new trade and economic arrangements that were to be considered would need to be consistent with the economic development policies of the two countries. The Prime Ministers emphasised that the success of any closer relationship would depend on the foundation laid by sound economic policies in both countries.

The Prime Ministers noted that while the expansion of trade was central to the further development of the bilateral relationship, the objective of closer economic co-operation would also be served by strengthening important links which already existed across a broad spectrum. Co-operation and consultation now taking place in fields such as tourism, energy, marketing, scientific research, technological development, labour, transport, finance and investment along with free movement of their peoples between the two countries were clear evidence of the special nature of the Tasman relationship. The Prime Ministers agreed that the decisions taken in all these fields must be framed to ensure that they assisted in developing the special economic relationship.

In support of this and as testimony to the importance which they attached to the further development and diversification of the economic relationship, the Prime Ministers endorsed the following principles:

the freest possible movement of goods between the two countries;

b) an outward looking approach to trade;

the most favourable treatment possible for each other’s citizens;

the freest possible movement of their peoples between the two countries, subject at any time, to their respective laws and policies;

the fullest consideration for each other’s interests in all aspects of the economic relationship: in particular, prior consultation on international trade and economic discussions; (0 frequent discussion and consultation on matters of common concern.

The Prime Ministers agreed that a sound foundation already existed for the development and expansion of bilateral economic relations. There was strong support on both sides of the Tasman for building on this foundation and making further progress.

Much good work had already been done in the development of closer co-operation by national bodies representing industry and agriculture in each country, and by organisations such as the Australia/New Zealand Foundations and Businessmen’s Councils. This, combined with the increasing number of exchanges between scientists and academics as well as various cultural and sporting contacts between the two countries served to promote the concept of a broader and stronger trans-Tasman relationship.

In conclusion, the two Prime Ministers reiterated their expectation that closer economic co-operation conducted in conformity with the principles agreed between them would result in economic and social benefits to both countries, and a strengthened ability, on the part of Australia and New Zealand working in partnership, to contribute to the development of the region. They were especially concerned to ensure that a closer relationship between Australia and New Zealand should provide a stronger base for the expansion of their economic and trading links with other countries, particularly those of the Pacific and South East Asia.


-An annex to the communique sets out guidelines for further study and determines more precisely the areas which officials would need to examine. I ask that it also be incorporated in Hansard.

Leave granted.

The document read as follows-


The Prime Ministers agreed upon a framework for further detailed exploration and examination of possible arrangements for a closer economic relationship. An outline of the basic approach and scope of these studies is set out below.

The central trade objective would be a gradual and progressive liberalisation of trade across the Tasman on all goods produced in either country on a basis that would bring benefits to both countries. However, no commitment to any specific proposal had been entered into at this stage, nor was it possible to determine if a satisfactory mutual balance of advantage would be attained until all the elements of a package had been defined and agreed.

In respect of tariffs applying to trans-Tasman trade, an initial examination would be based on a grouping of all products into three categories:

those which would move immediately to duty free treatment, for example, those with tariffs which were at 10 per cent (or equivalent) or less;

those for which duties would phase out over five years in equal annual steps after a one year grace period;

those on which a decision would be deferred because of special reasons. These could include but would not necessarily be limited to cases where an official industry inquiry was planned or in progress.

The objective would be to include all industrial and agricultural products in these categories while keeping the deferred list as short as possible. This work would result in the establishment of three lists common to both countries.

In respect of import restrictions, the possible techniques for achieving the objective of a gradual and progressive elimination of import licensing and tariff quotas between Australia and New Zealand, in reasonable time, would be studied.

Initially the study would apply to the two categories of goods committed to eventual duty free treatment and would be based on the following approach:

where trade was already flowing an annual increase in access of 1 0 per cent in real terms;

b) where no trade existed a base to be established and the above formula applied;

the resulting figures from (a) and (b) above to be of a sufficient size to give commercial viability.

A principle to be taken into account in the progressive liberalisation of import restrictions was that it should not foster the expansion of inefficient industries in either country.

A study would be made of agricultural support/stabilisation measures to identify whether there were aspects of these measures which might have undue impact on trading opportunities between the two countries. An assessment would then be made to determine the extent of any significant impact and to examine the scope and need for neutralising the impact on trans-Tasman trade in these cases.

Australia had a much broader industrial base and produced a wider range of industry inputs than was the case in New Zealand and assistance in Australia was provided across a broader range of industries producing such inputs. The difference in treatment of these intermediate goods industries in the two countries was recognised as requiring special study to quantify the problems and canvass possible solutions.

Both countries had export incentive schemes, although they varied in nature, extent and duration of commitment. It was agreed that an assessment should be made of their applicability to trans-Tasman trade within any future closer economic relationship, with the purpose of a review when this was practicable.

In any future closer relationship, industry rationalisation would be encouraged. Where industries which existed in both countries developed different product specialisation, consultations would take place with the objective of ensuring reasonable protection against third country suppliers of these specialised products in the interest of the economic development of both countries. Where practicable this would be encouraged by the adoption of a common external tariff and appropriate by-law or tariff concessions.

It was agreed that there were other and significant areas of possible co-operation which would need to be examined in the context of a closer economic relationship: customs valuation, customs by-laws or concessions and rules of origin, standards, continued consultation between industries assistance advisory bodies, government purchasing procedures, joint marketing activities in third countries and the development of tourism.

Transport, which was of fundamental importance to the development of trans-Tasman trade, would be kept under special review.


– I thank the House. I must emphasise that no commitment to any specific proposal has been entered into at this stage, nor will any decisions be taken until the studies have been completed and there has been full consultation with interested parties in both countries. Obviously, that includes, in our case, the State governments. There will also be detailed consultation with the industries that are likely to be affected as a result of any changed arrangements. Shortly, I shall be writing to the Premiers and to the Chief Minister of the Northern Territory to initiate those consultations. I hope that they can proceed in such a way that at the next Premiers conference, which will be held towards the end of June, there can be a meaningful discussion of the concept and of the attitudes of the States and of the Northern Territory. The departments will also be contacting industry bodies and other people in the private sector.

The details of any proposed new arrangements emerging from the studies and consultations will be made public before substantive decisions are taken. Because we are committed to full consultations, and because of the complexity of the details that remain to be worked out, it is not possible at this stage to set down a firm timetable leading to further decisions by governments. Therefore, no such timetable has been agreed with New Zealand. In the meanwhile, the NAFTA agreement will continue in place, and the existing Australian-New Zealand agreement on tariffs and tariff preferences, which was due for review in November of this year, will continue in effect for a further period of at least one year.

The next annual NAFTA Ministerial meeting is expected to take place in mid-July of this year and will be held in Canberra. In addition to the regular annual review of NAFTA matters, the Miniterial meeting between the Deputy Prime Ministers of both countries will provide an opportunity to review the progress in the studies and consultations set in train by the discussions in Wellington last week. It may be possible thereafter to have a firmer understanding of how matters will unfold. At that stage it might be possible to make a better assessment of what remains to be done and what the time-scale of further steps might be.

The statement that was issued by Prime Minister Muldoon and myself was, I think, of necessity, a cautious statement. The statement that I have made to the House reflects the same vein because we both recognise that there could be problems for industries in both countries in the processes of bringing about a closer transTasman economic relationship. Having said that, I think that we also both recognise that if, to a much greater extent, the New Zealand:Australia market could be treated as one- giving our industries a larger and more competitive base from which to face competition from the outside world, from which to attack and get into markets in the outside world- both countries will be advantaged in the process.

There is agreement between the Governments on the broad objective. It is a question as to whether, through this process, we can achieve the mechanisms that will enable it to be brought about. If, as we would hope, the process can move forward successfully these moves could well be the beginnings, the first signs, of a new economic relationship that will very significantly change for the better, for the closer, the relationships between New Zealand and Australia. I think that in itself should be applauded because, of all countries, our broad relationship with New Zealand is probably closer than that with any other country and it is natural that it should remain so. These measures are, in the modern context, designed to enable that relationship to move forward with strength.

However, there are reservations and questions that have to be answered. Until further studies are completed and are before governments, it will not be possible to set a timetable or to make firm decisions in relation to these particular matters.

Smith · Kingsford

-by leave- As the shadow Minister for Trade I welcome the statement by the Prime Minister (Mr Malcolm Fraser). The New ZealandAustralia Free Trade Agreement has been a crucial factor in trade expansion between Australia and New Zealand. I note that the original Schedule A contained some 990 items and that now double that number are included. The trade imbalance between our two countries has been improved. In 1975 the ratio was 2.68 to one. I understand that in 1978 the ratio was 1.6 to one. New Zealand has doubled its exports to Australia in the last five years. Trade between the countries has expanded considerably. In fact, it has doubled. But New Zealand has serious problems and I think that is the crux of the problem. According to the Organisation for Economic Co-operation and Development, since 1974 the gross domestic product per capita in New Zealand has fallen by an average of one per cent a year. The New Zealand deficit on current account has grown from $800m in 1978 to $ 1,200m in 1979. Inflation in New Zealand has risen from 10 per cent in 1978 to 18 per cent. I quote what was written by an Australian newspaper last year. It stated:

The New Zealand economy is sick … It has a chronic balance-of-payments deficit, the result of its farm exports being excluded from British markets . . . The situation will continue unless New Zealand can increase exports from its relatively small and highly protected manufacturing sector, and it is relying … to an even greater extent on Australia to provide the market. In other words, New Zealand is looking to Australia to assume a large part of its balance-of-payments deficit by generating a much larger trade surplus for the New Zealand economy which implies reversing the present situation.

That has implications for Australia. I would like to think that any discussions about economic interdependence between Australia and New Zealand, whether it be a cartel or co-operative measure, require serious and long term consideration. All relevant parties, including the manufacturing base, the trade unions and the Opposition should have an opportunity to contribute. It should not be left merely to what are called well-meaning bureaucrats. I note a report in the last couple of weeks in the Melbourne SunPictorial. An article, dealing with cheese and headed ‘It’s a sell-out, says farmers ‘stated:

A group of Gippsland dairy farmers want the Prime Minister to drop the Trade and Resources Minister, Mr Anthony, from New Zealand trade talks.

The United Dairyfarmers of Victoria feel that the Minister for Trade and Resources (Mr Anthony) does not understand farmers’ problems. Their problems are that if cheese is coming in from New Zealand the Gippsland farmers will be put out of business. I am also aware of what Mr Muldoon says when he is out of his own country. I was in the Philippines a few weeks ago when he made a statement on what was wrong with Australia. He is privileged to do that and I was perhaps anxious to join him but there was no merit in the case that he was putting. He said that Australia was doing something wrong. I will not go into what he had to say, but we know that some problems are not highlighted in this statement.

I think that this statement by the Prime Minister is a very light one. I can well understand the Prime Minister wanting to make excursions overseas. I am not being critical of that, but I think a visit to New Zealand on a matter such as this could have been left to another Minister. I do not think that we can get anywhere by talking about having a closer study of the relationship between the two countries. We know that there are serious problems. We also know what Mr Muldoon thinks about our Prime Minister. He made the comment last year that he was sick and tired of having to answer all the letters he receives from Mr Fraser.

Mr Malcolm Fraser:

– You are starting to spoil it. You were doing pretty well, Lionel, but you are starting to spoil it by following other precedents.


-It is very nice of the Prime Minister to call me by my Christian name; it deflates me completely. I know what Mr Muldoon said about Australia, I was the Minister for Manufacturing Industry and I visited New Zealand. I would have thought that the Prime Minister would have had something stronger to say about the difficulties that we face and what the governments of both countries plan to do to help each other. I make that point because Australia seems to have an obsession in relation to the Union of Soviet Socialist Republics. I refer to the New Zealand decision to conclude a fisheries agreement with the USSR. The point I am making is that I think New Zealanders feel we have lost interest in them. At times we have only pretended to show interest in them when we were really suggesting they should not be creating some advantage for themselves by entering a fisheries arrangement with the Soviet Union. Let me read what the Prime Minister feels are the major principles. I do not think they are very crucial. They read:

The freest possible movement of goods between the two countries; an outward looking approach to trade; the most favourable treatment possible for each other’s citizens; the freest possible movement of their peoples between the two countries, subject at any time, to their respective laws and policies; the fullest consideration for each other’s interests in all aspects of the economic relationship: In particular, prior consultation on international trade and economic discussions; and frequent discussion and consultation on matters of common concern.

The principles are fine but they could apply to any country. Australia’s relationship with New Zealand is not good. It is important to improve it, but can this be done just by having a study by public servants according to a statement of principles? I think not. There has to be something more important than that.

I have mentioned the basic difficulties that New Zealand faces. It is important that we understand New Zealand’s serious economic problems. New Zealand looks to us in a rather envious and jealous fashion, perhaps in the same way that at times we might look to the United States of America. Our relations with New Zealand are not helped when the Australian Government takes an attitude to New Zealand as it did on the fisheries agreement with the Soviet Union. The question is: What should Australia do? New Zealand is Australia ‘s largest trading partner. In view of this and the fact that the backgrounds and geographical positions of Australia and New Zealand are so similar, it is surprising that at the political level our relationships are not very good. Apparently, at an official level relations are good. It is at the ministerial level that problems occur. Because of this we neglect the opportunity to pool our resources where they might be mutually advantageous. Where possible Australia and New Zealand should be considered ideally placed to complement each other or reinforce each other at a political level.

Both Australia and New Zealand have negotiated agreements with Japan over access to our respective 200-mile zones. A major area of Japanese interest is in the tuna resources. Tuna is a highly migratory species of fish which enters both the Australian and New Zealand zones and is harvested by the same fleet of Japanese vessels. At present, because of a reluctance at the political level to get too close to New Zealand, the Japanese are very well placed to play Australia and New Zealand off against each other, particularly on the question of price. What we should be doing is co-ordinating our approaches to the extent necessary to ensure that countries seeking access to our respective zones are able to screw down the price they pay by using Australia and New Zealand as negotiating weapons against each other. Another area in which Australia could benefit through New Zealand’s co-operation is in the South Pacific. New Zealand is much further down the track in establishing substantive, meaningful relations with countries, in particular the small countries of the South Pacific, than is Australia.

Mr Malcolm Fraser:

– It is not, you know, any more.


-The Prime Minister is saying I am incorrect. Australia could benefit from New Zealand’s experience if there were a better political bilateral relationship between the two countries. Similarly, New Zealand could benefit more than it does from Australia’s expertise in South East Asia.

Mr Speaker, as you know, at the time of Federation in 1900 it was thought New Zealand might want to join Australia. I do not think that will happen. In view of the crises in the world, particularly in relation to energy resources and other areas, it is important that we clearly understand we can help each other. We have said in a jocular fashion that the best sorts of refugees coming into Australia are those who come from New Zealand. They are coming here because of the bad economic conditions in New Zealand. That country has plenty of resources. The Australian Labor Party obviously would say that the present New Zealand Government is not helping to solve the country’s problems because of its techniques in and attitudes on economic management. We see that the New Zealand Government’s policies are not working when we look at its level of inflation and the fact that it has to import its energy resources.

It is important that the two peoples understand each other. Trade is one way to reach understanding between the two peoples. We do not want to achieve it on the basis of trying to alter each other’s manufacturing base to the advantage of one or the other. It is not helpful for a New Zealand Prime Minister to be talking about Australia being too protective because any one of us could talk about the technique adopted by New Zealand to prevent Australian access to markets.

Mr Malcolm Fraser:

– Is that what he said in the Philippines?


-He said that when he was in the Philippines as a guest of the President. It made headlines. I am not criticising him for what he had to say but Australia’s attitude will not solve New Zealand ‘s problems.

The Labor Party welcomes the statement by the Prime Minister. However, I do not think we have gone very far along the track to making improvements. Discussions on NAFTA will be held in July and one would have thought that all these matters could have waited until that time. The most important point is that we should understand the problems of New Zealand and at the same time we should look at them from the point of view of the economic situation of the whole region in which we live. We have much to offer the South East Asian region, including Vietnam, and that is a problem which we ought to be educating ourselves on as well as New Zealand. The Opposition understands the reason for making the statement but we feel that the Prime Minister could have waited until after the NAFTA meeting in July.

Mr MALCOLM FRASER (Wannon-Prime Minister)- by leave- With the indulgence and perhaps with the acceptance of the shadow Minister, the honourable member for KingsfordSmith (Mr Lionel Bowen), I should like to add one or two points because I think they might help him in his examination of this matter. The important thing, and it is the basis of the discussions that will take place, not just amongst officials and bureaucrats but with industries in both countries, is the annex attached to the communique. It sets out a possible approach to the diminution or elimination of tariffs and also a possible approach to getting rid of import licensing which, as the honourable gentleman knows, in this context has particular problems for New Zealand. The annex sets out a possible program. We sought to have something which could be put directly to the industries of both countries and, in our case, also to the States. In something as important as this, I believe that we would want, if possible, the support of State governments in the overall objectives. So while the honourable gentleman read out the principles in the communique, the annex more precisely gives the details of the approach that in fact will be adopted.

The discussions that will take place with industries in both countries and with the States here will be directed specifically to the kind of approach which has been accepted as a basis for further consultation and later decision-making. The honourable gentleman said that it could have waited. On the other hand, he said that there should be an effort to improve relations at a political level. I think that this agreement might well have helped to consummate and enhance that. I hope that in this House we can deal with this matter from the point of view of Australia ‘s and New Zealand ‘s interests. I do not think that it should be dealt with on the basis of Australia, as a larger country, taking action because another country may or may not be in difficulties- there are perceptions about that in New Zealand which might be different from our perceptions- but from the point of view of two countries who do have very great interests in common.

Clearly, in matters as important as this, it is helpful if we can have an Australian approach and a New Zealand approach. If the matters become ones of sharp contention between the parties in either country, it might make the ultimate objective, which I think we would all want to support, much harder to achieve. I will certainly consult with my colleague the Deputy Prime Minister (Mr Anthony) about any information or briefings of the officials, who have been very much involved in these discussions. The honourable gentleman might like to have a discussion with the Deputy Prime Minister and a briefing from the officials so that he would be better placed to judge the amount of work and thought that has gone into the approach that is outlined in the annex. I am sure my colleague would make his officers available for that purpose.

page 1134



-For the information of honourable members, I present the second annual report of the Parliamentary Library for 1979. The report describes the activities of the Library and the Legislative Research Service in 1979 and points towards changes in the Parliament’s information services that could come in the not too distant future. Those changes are relevant to a management review by external consultants of the Library, Joint House and Parliamentary Reporting departments. They are also relevant to fairly rapid changes in information science and technology and an inevitable effect that these will have on reader and research services and departmental organisations. The steady growth in research and reference requests, which was noted in the 1978 report, has continued. The increased activities of parliamentary committees has been reflected in the greater number of both general and subject references requests received in 1979.

The need of senators and honourable members for current information, including quick access to audio and audio-visual material, has continued to grow. The overall growth in requests could be attributable partly to the information overload to which modern parliamentarians are exposed as well as to the complexity of many issues before them. The number of research assistants now working for senators and members has also increased the demands on the library and research services. There has been an increase in demands for current news, specific reference material, digests, background papers and information analysis. There has been a decline in the number of book loans from 17,458 in 1978 to 14,271 in 1979.

Honourable members would wish me to record our appreciation of the work of the staff of the Library. I commend the report to the House. I also inform honourable members that the Parliamentary librarian, Mr Harold Weir, has been elected to the grade of Fellow of the Institute of Information Scientists of England. This honour was bestowed on Mr Weir for his influence on the development of the. information services to this Parliament. The Institute is the first professional body with world-wide graduate membership in the field of information science, and promotes and maintains a high professional standard and qualification. On behalf of the House, I congratulate Mr Weir on his election.


– Arising out of your report and your comments, and with your indulgence, Mr Speaker, would it be pertinent to ask a question of you?


-The honourable member may ask a question now.


– My question refers to proposals that have been put to hive off the research service of the Library to another location. At what stage would you be in a position to inform honourable members of any decision on that matter, Mr Speaker?


– No proposal has been made. I have received a great number of representations from honourable members. Obviously, the representations have been stimulated by persons who wish a decision to be taken in their interests before overall decisions are taken in relation to the disposition of the Library and of the other departments that service the Parliament. I can give the honourable gentleman no information because no decision has been taken.

Mr Clyde Cameron:

-I wish to make a personal explanation.


-Does the honourable member claim to have been misrepresented?

Mr Clyde Cameron:

– Yes. Your report prompts me to do this, Mr Speaker. In the National Times, in the column called ‘Clancy’, reference is made to an unnamed member who had so badly defaced a book about Bob Hawke that he felt he could not possibly hand it back. It was not said in the report that I paid for the book, as I always do when I deface a book in the course of reading it. I always deface books I like reading because Professor Manning Clark has said that no true student of history can possibly read a book without marking the passages in it he considers worthwhile remembering. It is because I wanted to remember some of the passages in that book that I marked it so extensively. That is why I kept it and paid for it.

page 1135


Ministerial Statement

Minister for Defence · Moreton · LP

– by leave- The Government recently announced decisions relating to the level of the nation’s defence preparations. I wish today to talk more about the program, and our defence effort generally. Before doing so, however, I want to say a few words about the rationale for our policy and the measures we are undertaking. The Soviet Union’s invasion of Afghanistan is a conspicuous and brutal attempt to destroy the independence of a nation. The Soviet’s action represents a matter of grave concern for the entire world.

The issue is one which is far more serious than many people in this country are prepared to acknowledge. This attitude may be contrasted with the attitude held by many governments and commentators in a wide range of significant countries. The Government has sought to put the issue in proper perspective. It will continue so to do. Remote as we are, there are many who cannot see a connection between the Soviet invasion of Afghanistan and Australia’s interests. They tend to regard the Government’s reaction as exaggerated, even unseemly.

The Soviet Union’s invasion of Afghanistan represents a crisis in international affairs. But it is more than this. It is also a challenge to those of us who live in this country to lift our eyes beyond our immediate region. The facts are that the Soviet Union has nearly 90,000 troops in

Afghanistan at present. They are shooting and killing large numbers of Afghans, civilians as well as the armed guerillas fighting against them. Apart from the unhappy history of Eastern Europe, this is the first time since World War II that the Soviet Union has deployed formed military units beyond its national frontiers. For it to subjugate an independent country is an event of great significance for the international community. With the move into Afghanistan, the Soviet Union is placed to bring pressure against Iran and Pakistan and to work for access to the Indian Ocean. The move also significantly enhances the Soviet Union’s scope to develop pressure against the Gulf countries. These are areas from which and through which flow the oil supplies vital to Western Europe and Japan, and of great importance to the United States and ourselves.

With the conquest of Afghanistan, the Soviet Union will command a strategic salient that will secure its opportunities in all these respects for decades ahead. It is not good enough to say that Australia is a long way away; that the Soviet Union’s military operations there pose no direct military contingency for Australia itself; that the Soviet Union might not at this time push beyond Afghanistan with its military forces. Let me remind the House that much closer to home, in Indo-China, the Soviet Union is active not only in support of the Vietnamese military operations inside the sovereign state of Kampuchea but it has also secured access to air and naval facilities in Vietnam, although we do not know as yet on what terms. It would be folly to believe that the events which have culminated in the Soviet invasion of Afghanistan leave our longer term strategic prospects unaltered, and our responsibilities as a member of the community of free and independent nations, unchanged.

Events in Afghanistan cannot help but change the strategic perceptions of dozens of other nations. The kaleidoscopes which comprise each nation’s view of the world have been jolted; the pieces are now in new patterns in each eyepiece. We should be deluding ourselves it we believed that Pakistan should feel just as comfortable in March 1980 as it did in March 1978; that Japan should not feel heightened uneasiness about the security of its sources of energy; that China should not feel affected by Soviet actions in a bordering country; that the Iranian polity now emerging should feel secure with the Soviet Union killing Afghans across the border; that the spectacle of the Soviet Union seeking to extinguish by direct military force the remnants of Afghan independence should pass unremarked in so volatile a belt of nations as the Islamic world represents today.

I mention but a few affected countries. They are not blind; they will not pretend that the world’s most powerful land army has not rolled forward into a territory abutting regions of crucial importance to the international community at large. Every major capital in the world feels itself affected. Every government in Asia feels itself affected.

The Prime Minister (Mr Malcolm Fraser) has already conveyed to the House the sombre mood in which the North Atlantic nations are taking stock. The Minister for Foreign Affairs (Mr Peacock) found a similar situation on his recent tour of Asian capitals. And my own overwhelming impression is the same, following my visit overseas earlier this month. Changed perceptions inevitably will reflect themselves in shifts in the international security policies of nations. We cannot predict the directions of change and the new fabric that will be woven, but we can be pretty sure of at least two things that will colour the pattern. First, there will be recognition that super power relations are now characterised not only by tension but by mistrust. There is scope now for crises deeper and more frequent than we have hitherto experienced. Secondly, there will be few now who can confidently assert that, wherever favourable opportunities may occur for manipulation, subversion and interference, including the Asian and Pacific regions, the Soviet Union will not exploit them. Uncertainty and instability everywhere are stimulated by this.

We cannot have the same confidence in our long term strategic prospects that we had two years ago. I speak also of our responsibilities. Above all, Afghanistan has demonstrated the need for a new manifestation of political resolve on the part of independent nations everywhere, in every continent. All of us, together or separately, must give evidence that those who perceive a threat to their interests are prepared to back their resolve with military strength. The Prime Minister has already stressed the primacy of political cohesion and clear political purpose as an essential basis for confidence that the Soviet Union will not again achieve military victories by default of action on the part of independent nations.

When I spoke to the House a year ago about the broad perspectives of our defence policy, I spoke of the need for us to recognise that it was only on, in and over the sea that hostile military power could be projected towards our country. Our interest, therefore, is to do what we can to ensure that our maritime surrounds and approaches are not dominated by unfriendly, or potentially unfriendly, countries. We have a basic strategic interest that military relationships in our surrounding oceans are favourable to our interests. As a trading nation, we have a basic interest in the stability and security of international lines of communication across these oceans.

The Soviet invasion of Afghanistan raises serious implications for Australian interests. Australia cannot secure these objectives by itself. We must rely on our principal ally, the United States of America, to carry the main responsibility in this field. But we can, through our policies, and by practical measures in support of the United States, show our concern at Soviet aggression and our resolve to defend our interests and independence, and to raise the cost to the Soviet Union of interference with them. Among other things this means more activity in the Indian Ocean by Australian air and naval units. As the Prime Minister said, this activity will be essentially an independent, national effort but we shall co-ordinate our operations with those of the United States. We have offered the United States the use of facilities in Australia that might support their own operations. Detailed arrangements with the United States regarding facilities have yet to be discussed, after the United States authorities have clarified their requirements.

In offering the use of facilities to the United States, the Government has sought to ensure that the United States is not lacking in the support of its Australian ally in the heavy burden which it bears in deterring war and nuclear attack, in the interests of the allies and the international community generally. I might add that in the event of hostilities, risks of nuclear attack arise for Australia as an ally of the United States, whether or not it may be hosting particular United States facilities. Recognising this, successive Australian governments- I repeat, successive Australian governments- have taken the view that our primary concern should be to support the effectiveness of the United States deterrent to war itself. In this, we honour as well our responsibilities as an ally. Along with maritime operations in support of our United States ally, Australia must do more for itself. We must raise the level of our national defence preparedness. We should look to improve our capacity to support our political policies with military capability. Our strategic prospects and our responsibilities so demand. I do not say that military capability is all that is required. However, the range of policies that the Government must employ will lack substance and conviction unless backed by serious intent and capacity in the area of defence.

A most important dimension in our national defence effort is co-operation with the friendly countries of our neighbouring regions. Our objective is to enlarge this co-operation. This activity, already long established, is separate from our co-operation with our United States ally. We believe that the resilience of independent regional countries is an important element in reducing Soviet opportunities for expansion of its influence. As a regional country, we stand ready to support our friends as best we may by our defence policies. We believe that we can best contribute in our neighbouring regions. This is where we belong. We are well known there and have, as I have mentioned, long-standing ties and co-operative arrangements. Moreover, it is our neighbouring regions that constitute the area of primary defence concern to us.

To support the policies I have described, the Government has announced a program for defence which it estimates will involve spending some $ 17,600m over the next five years, in August 1979 prices. To those obsessed with planning guidance provided some four years ago, may I say simply that $ 17,600m represents significantly more in real terms than the earlier guidance. It will allow defence expenditure to grow by an average of about 7 per cent a year in real terms, and is expected to take total defence expenditure in 1984-85 to about 3 per cent of the gross domestic product. My Department has already been instructed to work on the assumption that defence expenditure in 1 980-8 1 will be $3,063m in August 1979 prices; that is, a real increase of 5.5 per cent above the 1979-80 level. The 1980-81 expenditure will be further increased, if necessary, to cover requirements for the purchase of the fourth FFG.

Before I turn to the main elements of the program I want to comment briefly on some recent statements that the program contains ‘little that is new’. The inference which such responses invite us to draw is that any program for an increase in defence preparedness must necessarily contain something ‘new’- some surprises, perhaps. The most charitable thing that can be said about such shallow comment is that it reflects a continuing failure to comprehend how the defence program is always adjusting to changing circumstances of one sort or another- financial, technical, strategic, commercial. It glosses over the many changes which are reflected in the recently announced program, on which I will elaborate shortly. Furthermore, it overlooks the fact that defence programs are generally unlikely to contain important elements which have not previously been publicly anticipated. This, I am pleased to say, is because of the very considerable amount of information which is provided by my Department to this Parliament and to the public about defence activity and planning in Australia, and because of the extensive public discussion which quite properly occurs about our defences.

We do not judge it necessary at this time to make sweeping changes to the force structure planned for later in the decade. On the whole, there is not yet a case for the large additional emphasis upon equipment numbers that would commend measures such as off-the-shelf purchases, or other short cuts with attendant cost and other penalties in terms of suitability for the Australian environment. Thus the major, highcost capital items to be brought into service are well known, and have been for some time: Patrol frigates commencing next year; new tactical fighters, the final selection and ordering of which will occur within months; patrol boats which start to come into service this year; the amphibious heavy lift ship, HMAS Tobruk, launched a few weeks ago.

We are aiming for decisions this year on the kinds of capabilities to be acquired for the period after HMAS Melbourne retires. Honourable members will be aware that designs for a new aircraft carrier are currently being evaluated. Closely associated with this matter is our consideration of the type of ship we should acquire to replace the present destroyer escorts from the end of this decade. These equipments will, of course, account for a large part of the increase in capital items, which are planned to rise from 1 5 per cent of total defence expenditure in 1979-80 to over 25 per cent in 1984-85. Payments on some of them will extend to the end of the decade. These items will now be added to. Limitations on the numbers of some items that we had previously been prepared to accept will no longer be accepted.

I turn first to our destroyers. While in the United States for the ANZUS conference, I opened discussion with the United States Government on Australia’s wish to purchase a fourth guided missile frigate of the FFG-7 class, and to bring it into service as soon as possible. The Americans have given us every assistance in examining ways and means of achieving an early delivery. Senior officers of the Department have already held detailed discussions with the Americans on the purchase arrangements. They are not yet concluded, but I am pleased to report that they are proceeding most satisfactorily. I expect to be in a position before long to inform honourable members of the outcome.

I turn next to our tactical fighter force. The new decision is that the number of new fighters to which commitment will be made at the end of this year will be 75- not fewer. Furthermore, we will not be making a series of separate decisions, as was earlier envisaged. A team of senior defence personnel, led by a deputy secretary of my Department, has just returned from negotiations in the United States on an understanding with the United States Government. This will cover arrangements under which the further evaluation will proceed, how the fighter to be selected will be acquired, and how our requirements for industrial co-operation will be met.

Overseas visits by other defence and Royal Australia Air Force teams will follow in the near future, to acquire and analyse the further data needed to enable the Government to reach a final choice of the aircraft that will be the mainstay of Australia’s air defences beyond the year 2000. This work is proceeding to schedule. Much needed to be done; much more is still to be done. But it is being done to the timetable planned. There has been no delay, no procrastination, at any time during the process of evaluating and selecting the new tactical fighters, nor will there be any.

I mention our fleet of patrol craft. There will be 10 additional patrol boats ordered, to meet increased surveillance and patrol requirements. These boats would also assist our defence cooperation programs with other countries. In September 1979, I told Parliament that the Royal Australian Navy was withholding its acceptance of the lead vessel, HMAS Fremantle pending negotiations with the shipbuilder over the problem of the vessel being heavier than specified. I now inform honourable members that HMAS Fremantle was provisionally accepted by the RAN on 5 March 1 980 and was commissioned into naval service on 17 March 1980. Final acceptance will be subject to trials with propellors of a new design, more appropriate to the vessel’s larger weight. These should be completed within about six weeks.

HMAS Fremantle and the follow-on craft will be heavier than the design displacement, but the effect on operational capability will be almost negligible. To be specific: Fremantle’s maximum ‘sprint’ speed has been lowered by about one knot. My naval advisers have assured me that the new craft meets the Navy’s requirements and will have a good range of speed- up to about 30 knots- and endurance, more than 3,500 nautical miles at patrol speeds. The trials have demonstrated that the effects of the additional weight have been largely offset by the efficiency of the hull form. The range of Fremantle at maximum continuous speed has been reduced by about 100 nautical miles.

An extensive weight-reduction program was carried out by the builders, Brooke Marine Ltd. Although the first patrol craft will still be about 20 tonnes heavier than specified in the contract, this is less than the weight excess earlier in prospect. As a result of an agreement recently concluded with Brooke Marine, the amount to be paid to the company for the lead craft will be reduced because of this departure from the design objectives. The first four of the 14 follow-on craft being built by North Queensland Engineers and Agents Pty Ltd of Cairns will be slightly lighter than HMAS Fremantle. However, further design changes which could not be incorporated in these vessels are expected to save a further 10 tonnes in the weight of each of the remaining 10 patrol craft. The Commonwealth’s indemnity has been extended to cover the consequential effects of additional weight on the Australian built vessels.

Although HMAS Fremantle and the four follow-on craft will be heavier than the design displacement, they will be entirely suitable for the tasks envisaged for them. Furthermore, the craft will have the 10 tonne margin for the future development of their capability that the RAN had specified when the contract was placed. This margin would allow the future fitting of new weapons should this be necessary. HMAS Fremantle is expected to arrive in Australian waters in mid-August 1980.

The acquisition of the 15 new patrol craft broke new contracting ground for Australia, with separate contracts for construction of the lead craft overseas, followed by an Australian building program. We have learned a number of lessons from this project, as a result of which my Department will be examining closely the contracting and phasing of any future building programs for such projects. For the time being, these craft will be equipped with the Bofors gun. This gun is used by most North Atlantic Treaty Organisation navies, and it is satisfactory in our judgment for present- I stress, presentAustralian requirements. A new weapon for the 15 patrol craft could cost in excess of $30m. At such a cost, the House will understand that we must look very closely at the priority of requirements.

I have so far mentioned developments in respect of our destroyers, tactical fighter aircraft and patrol vessels. There will be a second underway-replenishment vessel similar to the one recently ordered from Vickers Cockatoo Dockyard Pty Ltd. The two will allow us for the first time to have afloat support for the RAN operating simultaneously in the Indian and Pacific aceans. An aerial refuelling capability for our tactical fighter aircraft, which was one of the capabilities we judged last year could be left until later, now enters the program for decision in the five year period. The same applies to additional capabilities for our air defence systems. We will seek, in particular, to improve the capability for early warning radar systems tailored to our environment. Much hinges here on the results of the work on over-the-horizon radar, Project Jindalee, which is continuing with all possible speed. If I may say to the House, the results have been most encouraging.

Some items already in the program are now to be considered for decision earlier than was previously envisaged. One example is an additional hydrographic ship, brought forward now specifically with a view to adding to our capacity to give assistance to South- West Pacific countries. A research vessel, for experimental trials of equipment at sea, has been restored to the program, and brought forward for decision. The decision on medium trucks to be taken this year will now be made in respect of recommended larger numbers; among other things, to put more equipment, and more modern equipment, at the disposal of the enlarged Army Reserve.

The Government has also examined what else might be done ahead of the 1980-81 defence Budget. It has agreed that there are particular advantages in proceeding with the acquisition of two additional Sea King helicopters to replace recent losses, and the buying of further Mark 48 submarine-launched torpedoes. A close-in weapon system will now be fitted to the third patrol frigate, for training in defence against seaskimming missiles. I have spoken about some of the larger prime equipments, and some of the more significant additions to our capabilities. Those members of the House who have made a study of the first phase of expansion of the coreforce for that is what we are discussing- and who took evidence last year from my Department will recognise practical applications of ideas put before them. They will therefore recall that some other early measures were envisaged.

More specifically, they may recall its being put to them that provided the Government made decisions in response to the external indicators, the force existing when actual warning time began for a major threat would already be in the process of being shaped. It would, in the first place, be operating at a higher level of activity, making full operational use of some equipments which are now only relatively sparingly used in training and operation. The first expansions of force capability would be with intensified use of existing equipment and manpower. Decisions have been made in response to indicators. As I shall be describing later, first expansions of force capability, making much more use of equipments for training and operations, will be occurring.

A further basic proposition about early expansion was put forward last year to the relevant committee of this Parliament. In essence, it was this: A very significant distinction had to be drawn between the inventory of defence equipment that would be in service under the financial and strategic guidance then authorised, and the inventory that could be available if, in some new situation, it were considered to be a cost-effective use of defence resources to retain major equipments in service longer, or in reserve. Funds will now be applied to meet the necessary maintenance and manpower costs in selected areas of the existing inventory, where there is useful life longer than we felt justified in providing for this time last year. There is consequently a number of highly significant items in the inventory that must now re-enter calculations of just what Australia could put on the scales in any given year in the 1980s.

The Prime Minister has already announced that HMAS Vampire will not now be paid off. It will be retained beyond 1982 as a training ship and restored quickly to operational status should the situation warrant. A full modernisation of the DDGs is planned, instead of the more modest life-extension refit previously envisaged. An extensive modernisation of the older Orions, the P3Bs, is planned, instead of the more limited update previously provided for. The Fill weapons system will be updated for precision guided missiles.

I want to add something about vessels falling under the general heading destroyers. I have referred already to the discussions taking place about acquiring a fourth FFG from the United States and the retention in service of HMAS Vampire. A major consideration in our minds is that, at the end of this decade, the River Class vessels will be approaching the end of their costeffective life within a core-force. Part of the thinking behind the proposed acquisition of the fourth FFG is that it will give us more insurance against temporary reductions in core-force destroyer numbers, over the period when the River Class vessels are being phased out, and the follow-on vessels are coming into service.

As we have already made clear, these follow-on vessels are to be built in Australia. To that end, investment in the Williamstown Dockyard will now further increase. Work is already well advanced on the massive task of selecting a destroyer design, for decision this year if possible. Some 50 different types have been under consideration. The vessels will be central to our maritime strength well into the next century. Their construction will comprise one of the largest warship-building enterprises on which the nation has ever embarked. We want to plan it thoroughly and get it right, and do it in a way which provides opportunity for maximising the Australian content of the vessels.

In attempting to strike a balance between counsels of urgency and the objectives I have just mentioned, I have so far been inclined towards the latter. Given the intention in respect of the fourth FFG, I believe this to be the right emphasis for the time being. But I am confident that the Government would not shrink from measures requiring additional funds, or the setting aside of some of the more exacting objectives, should the nation’s defence necessitate the acquisition of follow-on destroyers more quickly. I have spoken so far about additional new equipments in our defence inventory; about equipments to be retained in the inventory and modernised; about the more extensive use of equipment; and about increases in the operational activity of selected equipments, in response to the immediate and the long-term strategic situation in our maritime environment.

These things cannot be isolated from the other elements of our defence. Of fundamental importance to our military operations and defence preparedness is an improved availability of resources for such things as spare parts, maintenance and equipment repair, flying hours, steaming time, ammunition holdings and other stores, and higher states of training of skilled manpower. In these respects also we aim to broaden the expansion base and reduce the leadtime for movement to a higher state of operational readiness, should that prove necessary. I cannot trace in detail all that is proposed as regards the stores that will now flow into the force, to sustain the operations and training that will proceed, and to raise the level of defence preparedness in selected areas. I will confine myself to some examples.

Action is already well advanced to build up Navy stocks of furnace fuel oil and dieso in Western and Northern Australia. These stocks will support all classes of ship, including the aircraft carrier HMAS Melbourne, that may be involved in increased activity in the Indian Ocean area. As well, selective enhancement of strategic fuel stocks in other locations is being arranged. Accelerated ordering of Army ammunition from Government factories is in hand. As well, early orders will be placed to enlarge the stocks of some basic metals, which will be used in the increased production of both weapons and ammunition. Inventory levels of selected stores, spares and repair parts of operational equipments are being increased to improve preparedness, and to raise the levels of operational effectiveness. An example is Sonobuoys which are used for underwater surveillance.

To support both the increased manpower and the higher levels of training, there will be a higher level of ordering for replacement vehicles, clothing, machinery and plant for workshops, and a range of other defence stores. Additional funds will be spent on the repair and overhaul of equipment. This expenditure will be used to improve turn-around in repair of equipment. Australian industry will attract the major portion of this expenditure and thus will be contributing to an increase in the preparedness of the Defence Force. There will be upgrading of our industry capabilities in support of defence, including research and development. Direct investment on upgrading plant and machinery and facilities in the aircraft industry and munitions factories is being increased. Similar expenditure is provided for facilities required in industry to support defence activities. Workload in industry will be increased by orders resulting from a higher level of service activity and a general increase in orders of capital equipment.

The decision to order 75 aircraft for the tactical fighter force will enhance considerably our ability to create opportunities for Australian industry in this project. The introduction of new technologies to permit long term support for the aircraft is an essential part of our procurement strategy. I have personally impressed this on potential suppliers during my recent overseas visit and they have been very active in industry programs to meet our needs.

The development and production of the new basic trainer aircraft will also enhance the skills of the aircraft industry. Local construction of the additional underway-replenishment ship will help the Australian shipbuilding industry, which depends significantly on defence contracts. Notwithstanding all our endeavours, it would be foolish to pretend that total self-sufficiency is a practicable option. Reality obliges us to bear in mind the size of the Australian industrial base, and the ‘State-of-the-art’ defence technology which a relatively small Australian Defence Force must seek to maintain. The reality is that the Australian Defence Force is dependent on overseas sources for the supply of major weapon systems, and for a substantial part of the ongoing supply of many associated support items. The country that supplies by far the major portion of the defence equipment and support items which we necessarily have to procure from overseas is the United States.

At meetings of the ANZUS council in June 1978 and in June 1979, it was agreed that there should be more definitive understandings about the continued availability of the supply and support of defence equipment which we procure from the United States. I am delighted now to be able to inform the House that, as a consequence of the ensuing negotiations, a memorandum of understanding on logistic support has been signed between the Government of Australia and the Government of the United States of America. This memorandum recognises the special relationship between our two countries. Guaranteed supply of all that we might ever want is, of course, not a realistic object of policy, and not what we have been seeking. The memorandum does, however, provide an important body of principle for logistic support to the Australian Defence Force during peace time, during periods of international tension or in circumstances of armed conflict.

Vital aspects are specifically addressed in the memorandum- such as the provision of additional weapons systems and equipments which may be required by the Australian Defence Force to meet expansion or to replace combat losses. There are also provisions for the locating of increased stocks in Australia and for expanding the defence production base. In addition, the memorandum contains reciprocal clauses regarding the provision of logistic support by Australia to the United States in given circumstances. Not all of the arrangements the memorandum embraces are new. Some of them flow from logistics agreements reached between the two countries in 1965. However, the memorandum does represent a substantial development in defining practical logistic relationships and responsibilities between Australia and the United States. I take pleasure now in tabling this important document.

I should make mention of some major developments in respect of defence facilities, and especially those fronting the Indian Ocean. There will be development of HMAS Stirling at Cockburn Sound. In the later half of this year, ships will be base-ported at Stirling for periods of several months, and before the end of the program period, ships will be home-ported there. The United States Government is currently considering whether it will seek base or home porting facilities at Stirling for ships of the United States Navy. The Government has authorised the construction of a new armament depot at Stirling and the construction of additional housing at nearby Rockingham, to support the increased activities at Stirling. A new fuel installation is also planned for the short term. In the longer term, further facilities are planned to increase the support capabilities of Stirling.

Ground facilities are to be developed at Learmonth, to support increased deployments to and from this RAAF base. The new airfield planned for Derby is to take the full range of RAAF operational aircraft. It is to have taxiways, hardstanding fuel facilities, weapons replenishment areas and accommodation for deployed personnel. The cost is estimated at $47m. Site investigations are proceeding now. The scope for a new amphibious training area in the west is being examined.

In eastern Australia, the New South Wales Government has agreed to defence acquisition of the unused Maritime Services Board berths adjacent to Garden Island. This will provide extra berths for RAN ships and will permit the efficient modernisation of Garden Island in a manner which will also enhance the aesthetics of the area. The Government intends to acquire Australian National Line’s interest in the Mort Bay container terminal in Sydney, and to use the site as a base for the deployment and logistic resupply of elements of the Defence Force. As well as contributing significantly to our Defence Force deployment capability, the relocation of Army terminal regiment elements to Mort Bay will allow the Commonwealth to meet a commitment to New South Wales to transfer a further 6.5 hectares of Commonwealth land at Middle Head to the control of the State. The Mort Bay acquisition will also give the Commonwealth guaranteed shore access to the facilities at Cockatoo Island dockyard, where a major employment-generating project is in progress. I refer, of course, to the new underwayreplenishment ship for the Navy.

I should point out here that the Commonwealth recently transferred back to the people of

New South Wales 305 hectares of prime Sydney Harbour foreshore land. Any suggestion, therefore, that the Commonwealth is now engaged in a land grab is a mathematical falsehood. These acquisitions are unquestionably in the national interest.

I would like now to say a few words about manpower. If you add to your new equipment inventory, retain existing equipments in service longer than planned, and step up your rate of use of equipment, obviously you need more manpower. You also step up your use of manpower already trained. Consequently you diminish the availability of skilled manpower to train fresh manpower, unless you take remedial measuresfor example, to improve retention rates. With the financial constraints prevailing, we have in the recent past accepted the existence of some chokepoints in these respects. We are now taking action to alleviate the problems, especially in respect of skills that take some time to train.

The Department has been given a target of 1,000 additional persons in each year of the program period for the permanent forces of the Navy, Army and Air Force. They will be additional to the 600 or so men required to bring the Townsville battalions to full strength. In recognition of its potentially vital role in the expansion which a major emergency could require, the Army Reserve is to be increased from 22,000 to 30,000. This will require a wide range of further stores and equipments, for which provision has been made. The intention is to ensure that if, in some future situation, we need to expand further, we could start from a substantially broader base.

Earlier this year, I announced that the Government had decided not to accept a recommendation by a previous inquiry that it should legislate to provide for the compulsory call-up of the Reserve in peace-time. Nevertheless, the Government makes it clear that in times of national emergency, elements of the Army Reserve most certainly would be deployed. In reaching its decision the Government took account of the current provisions of the Defence Act, which provide for call-up of the active Army Reserve in time of war or defence emergency. It took into account also that members of the Reserve can, if accepted, serve full time on a voluntary basis. Of particular importance is that the present legislation allows a stable relationship between the Reserve soldier and the employer. The Government believes that the Reserve will attract a satisfactory level of support without resort to compulsion. We want it widely known that the opportunity exists for every suitable young Australian to serve the country and contribute to its defence preparedness by Reserve service.

I have previously made an announcement about the Army re-organisation that has now been set in train following a thorough review. Time militates against my recapitulating that ground here, except to say that the process will be given more momentum by the decisions we have now taken. There is, however, one particular aspect to which I would like to allude brieflythe decision in respect of the battalions at Townsville. One particular objective is to increase the availability and readiness of Army elements for limited operational tasks that can arise at short notice. In order to achieve this capability, we have constituted the Third Task Force in Townsville as an operational deployment force. It will be an air-transportable task force, with logistic elements. Depending on the task and its location, it will be capable of quick deployment, building up by stages to a balanced battalion group, which would include from the outset both combat and logistic support as well as the first infantry battalion. The remainder of the task force would be capable of follow-up deployment as and when required.

Another point to note with respect to manpower is that there will be a requirement now for some easing of the numerical constraints on certain categories of civilian employees, and for increases in some areas. This would be mainly in government factories and dockyards, in key equipment projects and technical and specialist areas in the Department, and in direct support of the Defence Force in workshops, supply, training and base support units.

A word about service pay and conditions. In recent weeks some publicity has attended the issue, which has two aspects: First, the delays which have occurred in the past in passing on to members of the Services increases in pay and allowances which had been awarded themparticularly those increases arising from recommendations of the Committee of Reference for Defence Force Pay. Second, the adequacy of existing rates of pay and allowances for attracting and retaining the right type of person in the armed forces. As regards the first point, the passage of amendments to the Defence Act in November 1979 will substantially overcome the delays which have beset the administration of the Services pay and allowance systems in the past. The Act now empowers the Minister for Defence to make determinations to provide the legal cover for approved changes, without relying on what has proved in the past to be timeconsuming processes associated with the amendment of regulations. Work has proceeded apace under the new arrangements, and by the end of March all but a small proportion of increased entitlements already awarded will have been paid. The new arrangements required some time to be put fully into operation; but they will ensure that changes will in future be put into effect much more quickly than was the case before November 1979.

As regards the second point, it is acknowledged that in each of the three Services the number of suitably qualified persons available to man certain musterings and categories is below our needs. This situation will be exacerbated by the enhanced defence effort to which I have already referred; and retention of highly trained manpower will assume greater importance. Priority is being given to an examination within the Department and the three Services of the specific areas of retention difficulty, as well as to the more general question of overall levels of remuneration. As necessary, the Committee of Reference for Defence Force Pay will be asked to investigate promptly and made recommendations in these areas.

I turn now to the subject of defence cooperation with our neighbours, about which the Prime Minister spoke in his major statement last month. My Department has been instructed to provide in the program for funds to facilitate an expansion of such activities. I would expect these mostly to take the form of an increase in the already significant amount of project aid and training that Australia provides, and further combined exercises where these can be arranged.

As I reminded the House last year, the professional reputation of the Australian Services stands high in our region. The number of bids for places at our training institutions, and for the services of our instructors and technical experts, always exceeds our capacity to respond. We intend to increase that capacity. Action is already under way to determine what more we can do. A training team returned last week from consultations with the defence authorities of several South East Asian countries, about their priorities in respect of an increased Australian training effort. The Secretary to my Department will be visiting South East Asia in the near future, for consultations about a range of matters affecting defence interests that we have in common with our neighbours. As the House will be aware, the senior service and civilian officers in the defence administration of Papua New Guinea recently visited Canberra. This was part of the program of regular consultations between our two countries. The Government attaches considerable importance to consultations of this kind, and will continue to foster them.

I want this House to be under no illusion that the efforts we are now setting in train will make heavy demands upon the time and skills and experience of our defence administration. This Government holds itself to have been well served by that administration in recent years, under difficult circumstances where, on clear Government direction, compromises had to be made with previous plans so as to serve the overall economic interests of the nation in the war on inflation. Fine judgments had constantly to be exercised, hard and often unpalatable advice offered on what could be done, and on the practical consequences of this or that course of action.

The Government offers the defence administration no relief: Indeed, its burdens will increase. I hold it to be important, however, that the defence administration not be required to divert even more of its energies and its best manpower than has been the case in the recent past to support somebody’s review of this, or investigation into that, or inquiry into something else. These activities are important. But they must be kept in proper proportion to the prime task which is administering our defence effort.

The defence administration in Australia was subjected in the 1970s to the most profound reorganisation in its history. I want it to be entirely clear that on the whole the Government is satisfied with the results. It is seen by senior service officers to be an improvement on what we have had in the past, although of course some further evolution is bound to be necessary. The new organisation needs full opportunity to settle- and to channel all the energies of its best people, all the time, into the large and exacting tasks ahead of it.

I do not mean to suggest by this either that there are not a number of areas of continuing concern, or that complacency should be allowed to develop. The quality of complacency, if indeed it be a quality, is the last quality to be found in senior service officers and their civilian colleagues. As to areas of concern, and their continuous review, I might remind the House of, for example: The Army re-organisation, about which I have already spoken; the two-tiered review, external and internal, which is currently being conducted in respect of the Defence Science and Technology Organisation; the continuing examination of procurement procedures; the review of the RAAF last year; the command and control review of the RAN, completed in 1978, which is now being followed by a supply and support review, due for completion later this year. I mention only these major matters in the continuing process of appraisal and re-appraisal that is taking place, in the Department and the Services. This process of close scrutiny and change is a major continuing feature of our defence administration. I would ask my friends on both sides of the House for their understanding and sympathy in this work which has continued over a very considerable period and which will continue into the future.

Finally, I should report to the House briefly on my recent visit abroad. My visit to the United States provided me with an opportunity to observe at first hand the change in mood there and that country’s determination to meet its global responsibilities. Although the primary purpose of my visit to Washington was to attend a meeting of the ANZUS Council in company with the Foreign Minister (Mr Peacock), I also had the benefit of discussions with senior authorities in the Pentagon. I have already referred to some of the matters discussed in Washington- the fourth FFG, the TFF and the memorandum of understanding on logistic support.

As the House is aware, the timing of the ANZUS meeting was advanced and the venue was changed from Wellington to Washington, in view of the new international situation stemming from the Soviet invasion of Afghanistan. I would emphasise the particular importance for Australia’s security that attaches to a meeting of the ANZUS partners in present circumstances. The Foreign Minister will be reporting on the close agreement of the Council members on the implications, not just in the short term but also over the longer haul, of the Soviet Union’s recent flagrant violation of the integrity of an independent sovereign state. It was particularly valuable at this stage for there to be an opportunity for exchanges of views at ministerial and high military levels. These exchanges will enable officials to go forward in the development of planning, and for governments to take decisions on the various options which military planners can provide.

I have described in more detail the principal elements of the expanded defence program announced by the Prime Minister on 19 February. But I have by no means encompassed all the detail of the changes and adjustments contained in that program. In essence, the program provides for the acquisition of some major items of equipment earlier than previously planned; for more comprehensive modernisation or improvement in the capabilities of some equipment already in our defence inventory; for development of our defence infrastructure; for an increase in our defence manpower; and for a higher level of operational activity. These adjustments result from one simple fact: Future events are less predictable than was the case even six months ago. The balance of power has been fundamentally disturbed, by an aggressive and grasping nation, in an area which for centuries has been a pivot for relationships between the major powers. The strategic reverberations of this disturbance are world-wide. Our defence effort must respond to the new uncertainties.

It has been and will remain the Government’s firm endeavour to secure peace throughout the world. We will use all of our resources towards that end. We will contribute to that end in whatever way we can. The Government is deeply convinced that human aspirations can best be fulfilled when peace exists. The Government holds strongly to the view that the great problems which face humanity in so many parts of the world can best be settled when men and women live in peace with one another. The goal of peace is a great one and to attain that goal we must command the respect of all people of goodwill. Yet power remains a sanction in dealing with potential conflict. Where power exists and commands respect it will seldom if ever be used. That is a reality from which none of us can shrink. And, it is a reality from which this Government will not shrink. I present the following papers:

Defence program- Memorandum of understanding on logistic support between Australia and United States of America, dated 18 March 1980. Ministerial Statement, 25 March 1980.

Motion (by Mr Thomson) proposed:

That the House take note of the papers.

Motion ( by Mr Viner)- by leave- agreed to:

That so much of the Standing Orders be suspended as would prevent the honourable member for Corio speaking for a period not exceeding 52 minutes.

Sitting suspended from 5.57 to 8 p.m.


-Before the suspension of the sitting the Minister for Defence (Mr Killen) delivered a fairly extensive statement on both what he sees as the strategic position and the future defence plans of the Government. I do not intend to canvass all of the issues that are embraced in the Minister’s statement but I do intend to endeavour to raise some matters which arise from it and query some of the assumptions that it makes.

The Minister, in his preliminary remarks, drew attention to the changes in the world situation that have taken place over the last few months, changes which have motivated the Government in the area of defence and have certainly brought about considerable public debate and debate in this Parliament on matters related to foreign affairs. I was surprised that, in the Minister’s statement and, if I may say so in earlier debates, the questions now seem to be limited to the consequences of the Russian presence in Afghanistan and there seems to have been a passing over, for deliberate or other reasons, of what would have been and still is I think a very significant problem which we in the Western world must confront. I refer to a development which had, prior to the Russian invasion of Afghanistan, caused considerable alarm and that is the change of administration in Iran, the West’s relationships with that new administration, and the possible consequences thereof throughout the Persian Gulf and Middle East areas.

It would seem that the long term consequences of that action are equally a problem with which we should be concerned. I do not think that they threaten our security but certainly they could have long term economic consequences and some time ago were of sufficient consequence for the Government to order a new strategic review based upon them. They appear now to have disappeared from the strategic assessment and other considerations. It is possible that this situation could be a greater threat to world peace than the Russian invasion of Afghanistan, especially as we have not at this stage shown any indication or capacity to cope with a new regime which exercises enormous power over the West’s economies, which does not respond to normal pressures and which does not act in what we would look on as a rational way. I make the point that Iran could precipitate a situation by, for instance, cutting off supplies of oil and gas to the Soviet Union, which it threatened to do in only the last few days. That could endanger world peace in a far greater manner- because of possible Russian responses to what would be a threat to its economy- than is likely to result from the Afghanistan situation unless some other activity or motivation takes place in that area.

The Minister appears to have given up on efforts by the Prime Minister (Mr Malcolm Fraser) and the United States to have the Soviet Union remove itself from Afghanistan. His statement suggests that that situation has evolved and will remain as it is. I do not intend to challenge that assessment but it is one which I think is different from that which is being put forward by the United States. Certainly it is different from what the Prime Minister was saying only a few weeks ago. The Government does not appear to have any input to, or confidence in, the Europeans proposals for the neutralisation of Afghanistan.

These are questions of foreign policy and will almost certainly be debated at length in this Parliament, but in assessing our position with regard to the future development of our defence forces it is important that we not overreact to situations occurring in the Persian Gulf and the Middle East. I think the Minister would agree thatoutside of a major confrontation between the Soviet Union and the United States- it is unlikely that we would become involved in direct conflict in that area. For instance, I doubt that we would be welcomed in placing military forces in Iran. Nor am I sure what the consequences of any such attempt would be in other areas surrounding Afghanistan or the Soviet Union.

One other matter which emerges from the preliminary remarks of the Minister, and which also concerns me, is his further reiteration of the Government’s commitment to the regime of Pol Pot in Kampuchea. A foreign invasion of any country, be it Afghanistan, Kampuchea or any other, would obviously be condemned by every one of us who believes that people are entitled to self-determination. As a consequence, I do not think that any person could condone what happened in Kampuchea under the Pol Pot regime. Certainly, nothing that this Government or any member of this Parliament says should give comfort to that regime or provide any indication that we would support a restoration of a government of that type in Kampuchea or in any other country on this earth. It was a vicious regime which was guilty, to a degree greater than has been the case with possibly any other regime in modern history, of the systematic murder and tyrannising of its own population. I hope that the Government will abandon any suggestion which can be misconstrued, or properly construed, as expressing support for that regime. We would be far better off if we withdrew recognition of that government, even though we did not recognise another in its stead. It was not a government that we could support.

The Minister’s statement, as it related to defence, was similar to a number which have been made over a period in this House. Since the major statement of 1976 to which the Minister refers we have had no concise statement of Government intentions and certainly no detailed outline of what it sees as the aims or objectives of the Australian Defence Force. If we assume that the 1976 paper is still relevant we have also to assume that nothing has changed strategically and I do not think that that is a correct assessment. This paper does not indicate what changes the Government sees in the role of the Australian Defence Force nor does it indicate what the Government expects the Australian Defence Force to be able to perform. Given that Australia is a nation of limited resources and irrespective of what proportion of those resources we devote to defence the roles which can be adequately carried out by our Defence Force will of necessity be limited.

Clearly, one would expect that the major, the first role of any Australian Defence Force would be a capacity to defend Australia, should that become necessary, against either major incursionwhich I think it would be agreed is unlikely- or limited incursions, or invasion of, our sovereignty which could take place on a much lower level but which would necessarily require from our Defence Force a fairly significant capacity to respond. The movement of our defence emphasis to the Indian Ocean is easy to justify in the current circumstances. We are moving our defence emphasis to an area which is closer to what we see as the likely trouble spots in the world. I am not sure, however, that we are in fact responding correctly to the realities of the situation. Certainly we should not be neglecting the surveillance and the protection of the western coast of Australia. But at the same time, it is necessary for us at least to accept that we are now the most significant power in the Pacific area, that this is likely to continue to be the case and that increasingly the burden of providing a defence presence in that area will fall to the responsibility of Australia. At present, the Pacific Islands have a small defence capacity at their disposal in New Zealand and a substantial French presence in French Polynesia and to a limited extent in New Caledonia. We would be expected, I believe, by our allies to provide the major defence presence in that area should it be decided, as I think it most likely will be in the not too distant future, that the French will move out. Certainly the British have already indicated their intention to do this. My understanding is that the United States of America does not intend to fill that vacuum and will expect Australia to take over the defence role.

In determining the type of Defence Force we need, the capacity that we need and the location of significant units of that Defence Force, we have to understand and assess our responsibilities, our capacity to meet those responsibilities and the needs of a Defence Force capable of meeting, within our resources, those responsibilities. I do not think that can be done on a short term basis. The decisions that the Minister has announced and that the Government will carry out in the next sue to eight months or the next three years will have to be accepted by future governments. It is therefore important that these decisions should not be taken lightly, nor should they be taken for short term political reasons. The situation in Afghanistan could disappear in 12 months. Certainly, I would not expect relations with the Soviet Union to improve in any short period. In this statement the Minister is talking about a program for defence expansion over a period nearer to 15 years than the five years projected.

The Minister has indicated that the Government is close to making a decision on future naval air power and that we will proceed- I do not think anyone doubted this- to the acquisition of a fighter aircraft to replace the Mirage fighter which clearly is obsolete and that a fourth FFG frigate has been ordered to provide a modern destroyer class vessel to carry us through the 1 980s. He also has indicated that a program of follow-on destroyers will be involved for construction in Australia, probably in the late 1980s. I have some doubts about the suggestions that we will modernise and continue the existing units of the fleet beyond what is currently their expected life. There is a lack of detail in the statement relating to what is intended by ‘further modernisation’. At least the DDG’s have recently gone through a modernisation program of considerable magnitude. One would ask for and expect to receive at some stage details of what additional modernisation is intended for those vessels.

I certainly would not wish to be charged with the responsibility of fighting a battle with some of the older vessels, given modernisation and the fact that our likely opponents would have much more modern platforms from which to conduct the battle than we would. I doubt the economics of that proposition but I hope that the technical advice available to the Minister is adequate and accurate. He has not indicated at this stage what roles the Government expects the Defence Force to be able to carry out. It is an important consideration and one which to my knowledge has not been indicated in the last five years. The Defence Force planning must of necessity be aimed either at specific tasks set by the Government on the basis of its assessment of what the requirements of a Defence Force will be or the Defence Force must plan to try to be a jack of all trades able to meet whatever contingencies may arise without any real guidance and without any real hope that such contingencies could be met.

The statement indicates some changes in equipment priorities and also indicates that some areas of equipment priority will be brought forward. I ask the Minister to inform the House at some stage why a number of defence projects set out in the 1976 White Paper on Australian Defence have not come to fruition. I note that the Minister indicated that he felt it was a weak argument to refer back or to make reannouncements of old programs and that something new cannot always be provided. But I point out to the Minister that the only reason for pointing to old programs is that they have not been carried out and are still being deferred. The reannouncement of old programs is an indication that what has been proposed has not in fact been fulfilled. A number of projects foreshadowed in the 1 976 White Paper which would seem to be as relevant now as they were then appear to have disappeared totally or, if they have not disappeared, they are certainly not being spoken about. They include short to medium range. surveillance patrol aircraft, precision guided munitions, improved targeting, an electronic counter measures capacity for the Fills and helicopters for the FFGs.

The acquisition of helicopters is a part of the FFG program but now they will be at least four years behind the first delivery date unless some decision can be made in the not too distant future. The chief of the Defence Force was recently reported as saying that no suitable helicopter is available anywhere in the world for that task. I would be surprised if that is a correct statement. Nevertheless, no decision on a helicopter has been made even though it is now four years since the first orders for the FFGs were placed. One would assume that at least the United States Government intended to put helicopters on their FFGs. Those helicopters may not meet our standards. If they are Lamps, they may not suit our purse. But there is a range of helicopters available. It may well be that the deferment has been made in the hope that something which is not available at present will become available.

I am not sure whether it is realistic to bring into service a modern fighting ship without equipping it with what is considered to be absolutely necessary for its protection in an action situation. I refer to the eyes of the vessel’, namely the helicopters. They are not mentioned in this statement. One must anticipate that they are under consideration but apparently the problem is nowhere near resolution. The 1976 White Paper also referred to the fitting of processing equipment for use with Barra bouys on the Sea King helicopters. I note that Australia is to purchase two more Sea King helicopters to replace those that have had unfortunate accidents but there is no indication whether the Barra buoy system will be fitted to those helicopters even though the project was announced in 1976.

The White Paper also referred to mine countermeasure vessels. The current vessels have been in service since 1953 which, to say the least, puts a bit of age on them. A proposal for a replacement vessel has been around for as long as most of us can remember yet there is no indication in this statement of whether that type of capacity will be available to our armed services. In a statement last week, the Minister spoke about blockading some areas in the Persian Gulf. I point out to the Minister- I think he will be well aware of this fact- that one of the easier military operations to limit a naval activity in this day and age is aerial mining with modern mine capacities to which at this stage we do not appear to intend to acquire a counter capacity.

Mr Killen:

– If my friend would excuse me interrupting him, I spoke of the enormous Soviet mining capability. I did not refer specifically to blockading.


-In the list of forgotten or deferred items in the 1976 White Paper is the capacity and range of available mining capacity for the Australian defence forces. It would be necessary in any maritime situation to have capacity to utilise modern techniques in that area, not only to remove an enemy’s mines but also to lay your own. That is in the 1976 White Paper, but it is no longer being mentioned. Locating radar, surveillance radar, and navigational and sensors equipment for the Army apparently are among the forgotten things yet are absolutely necessary if the Army is to perform any function at all. According to this White Paper, apart from some changes in structure in Townsville the Army is not going to perform any function at all within our Defence Force. It appears to have no role and certainly has no priorities in the equipment areas. For the last five or six years antiarmour has been talked about for the Army. It does not appear to be in the next five-year program. The Government is going to purchase more trucks, but there is no indication of a replacement capacity for the 155 or 105 field guns, which are well beyond their effective military service now and which it was announced in the 1976 White Paper would be replaced in 1 977-78.

We have repeated statements on defence, on equipment programs and plans, but we have no overall statement of the Government’s intentions or its intended capacity for the Defence Force; nor do we have any ground plan for the integration of those equipments into a total Defence Force or a total defence capacity; nor do we have a role which we expect the Defence Force to be able and competent to carry out. Strung together, equipment orders look very nice on paper. Placed on a ground plan, they are like a jigsaw puzzle with half the pieces missing. They do not in any way show a composite whole for a defence capacity to carry out any role of which the Government may consider the Defence Force should be capable. There is a lack of direction, and it is a lack of political direction. It is not a lack of capacity within the department or the Defence Force.

One other matter of concern is the costing as it is set out by the Minister. He has set out the costing arrangements throughout the paper. He did not see fit to collect the total equipment and costing arrangements into one section of his speech. Nevertheless, that is the manner in which the speech was delivered, and it is not for me to say how the Minister should do it. It would have been much more convenient for the House had a statement indicating the positive decisions been prepared and presented or at least collected in one part of the speech for ease of access. The costing arrangements would seem to be extremely thin and, without the benefit of the Treasury or someone else to add them up, they do not seem to add up to 100 per cent of the Defence budget. The Minister has indicated, firstly, that during the five-year program there will be an increase in the Defence vote. In normal circumstances, that would be expected to reduce the percentage of the Defence vote which is occupied by the component parts. So some latitude would be available for moving one or other of the component parts of the total Defence vote to a higher percentage level. The Minister has indicated that a 25 per cent level will be available for major new equipment purchases. Given the backlog that has taken place since the 1976 statement, that sort of expenditure on equipment is most likely to be necessary to keep up with the capacity the Defence Force has at the moment, in view of the fact that a good deal of its equipment is either obsolete or approaching obsolescence and cannot be expected to continue in effective military service for much longer.

The figure of 25 per cent is a 10 per cent increase on this year’s allocation. It should be understood by the House that this year’s equipment vote is an abnormally high one because of the repayment of Defence purchase orders made some considerable time ago. It would normally be expected to have fallen so that those parts of the ongoing defence expenditure which are deferred in years of high repayment would have a catchup period. This year, substantial maintenance and other costs which normally would occur in the Defence budget have been deferred because of the high percentage going to equipment. It is normal Defence financial management that there is an ebb and flow in this area. The effective amount of the Defence vote going to equipment over a long period has been around 12 per cent. As I understand the Minister’s statement it is intended to increase this to a firm 25 per cent of the Defence budget. That will enable the Australian defence forces to be equipped with modern equipment, even though there are holes in this program at the lower end of the Defence scale which I think are dangerous and certainly cannot afford to be allowed to continue for a further five years. Some of the capacities we are lacking at the lower end of the scale would place our Defence Force in jeopardy should it be required to operate in an action situation. We hope that it will not.

As to the 25 per cent equipment figure, the current level of manpower costs in the Defence Force is, as I understand it, 53 per cent of the total Defence vote. It would be expected, if it were constant, to drop to something like 50 per cent of the Defence vote if the Defence budget is increased from 2.6 per cent of gross domestic product to around 3 per cent of gross domestic product. The Minister’s statement indicates that there will be greater expenditure on manpower than there is at the present time. An additional 1,000 personnel a year will be added to the Defence Force if recruiting arrangements can supply that number. There will be added training costs for the additional 1,000 personnel a year, and by the end of the fifth year, when the 25 per cent equipment target is reached, the number of additional personnel will have reached an additional 5,000. An additional 6,000 persons will be added to the Defence Force Reserve, with accompanying costs. I think it is fair to say that, as a result of that, the cost of manpower will have increased rather than decreased as a share of the Defence budget.

We have in those two areas a commitment of 25 per cent of the Defence budget to equipment and between 50 and 55 per cent to manpower costs, which leaves a very small percentage of the total Defence vote- 20 per cent- for all other costs relative to the Defence area. Training, maintenance, and facilities all have to fit into that 20 per cent. At present, administrative costs exceed that 20 per cent. It is all very well to say that there will be an increased expenditure on equipment and an increased manpower operation by the Defence Force. I agree with the Minister that there should be an increased remuneration for some of those persons in the Defence Force who are currently significantly underpaid relative to the skills they have acquired and are expected to acquire in order to perform in a modern technological Defence Force. Unless those rates of pay are maintained at something comparable with civilian levels, then the best and most skilled persons in the Defence Force will be lost to the civilian population. All the dedication in the world cannot compensate for the benefits which can be obtained outside, both monetarily and in long-term security.

Going back to the financial arrangements, on the statement presented to the House the Minister has in fact in this five-year program indicated that something in excess of 1 10 per cent of the defence Budget will be committed at the end of that program. That leads me back to the 1976 paper, because the Minister has made it quite clear that he does not think it is a sound argument for honourable members of this House to draw attention to those parts of that program that have not been carried out. The fact is that governments of a conservative complexion in Australia have a long history of making speeches about defence and doing very little about it. They have also a very great capacity to obtain political mileage out of their own inactivities. The Prime Minister (Mr Malcolm Fraser) in this House a few days ago made a statement about the low levels of expenditure which took place between 1972 and 1975 on equipment. That is correct.

In 1969 the then Minister for Defence, Mr Fairhall, announced a very comprehensive defence program for capital equipment acquisition- three months before an election I might say. It was a much needed program. Between 1 970, immediately following the return of the then Government, and 1972, more than half of that program was cancelled by the then Government. The only significant part which was carried forward was that of the DDL program for construction of destroyers in Australia. That was, I think it is fair to say, the most incompetently managed program ever perpetrated by an Australian Government. The program had not actually reached the construction stage when it was cancelled. It was in excess of $ 100m over budget and the vessels concerned bore no relationship at all to the original requirement which was set out for the Navy at the time the project was approved. If it had not been cancelled we would still not have had the first vessel, but we would have had the greatest planning blunder ever perpetrated in the history of naval architecture.

It is significant that even at this stage the Minister finds it necessary to inform the House that the follow-on destroyer program could be delayed because it is absolutely essential for the planning to be got right- I think I use the Minister’s words- before the project goes ahead. Certainly, Australian industry could not afford to have perpetrated on it again a program so mismanaged as was that particular program. It set back Australian defence industry by 10 years.

With regard to the manpower program set out in this paper which was presented by the Minister today, there are a number of aspects which have to be explained to the House and should be set out in more detail. The Minister has indicated, as has the Prime Minister before him, that an additional 6,000 men and women will be recruited to the Defence Force reserves. At the moment the Defence Force reserves are suffering from a serious malaise. They are neither part of the Defence Force nor are they akin to the boy scouts. They are not being treated seriously by the Defence Force. Certainly, they are not training with equipment nor are they being given the encouragement which is necessary to make them an effective part of a military force. The Millar report has been substantially ignored. Some of its recommendations have been implemented, but the majority have been ignored. If the Government is to recruit additional men or women to the Defence Force reserves, it has to evolve a completely new program which will make those reserves attractive to young men and women who want to serve their country and who want to think, in serving their country, that they are doing something which is of benefit. Some units do have adequate capacities and are in fact performing well. Others are badly under strength and are unable to maintain recruits. It is a serious problem and morale is almost nil.

Mr Killen:

– That is rubbish.


-I suggest to the Minister that he go out, not as the minister but as a private person and talk to people who are in the reserves. The fact is that the Government is not even prepared to consider what is a minor irritation to the Government but a very serious consequence to some young men and women in the Defence

Force reserves. Last week and on an earlier occasion I raised in this House- I am certain the Minister has had this raised with him by members of his own Party- the problem which unemployed members of the reserves are suffering because of the activities recently instituted by the Department of Social Security. That Department is cancelling unemployment benefits to unemployed members of the Defence Force reserves where they receive payments for activities in the reserves. It is a tax free component of income where they earn income as a result of employment or from other sources, but when they are unemployed and dependent on the Government for their resources the Government cancels their unemployment benefits to the extent that they earn money in the reserves. It is a positive discouragement of young men and women to continue in the reserves if they are unfortunate enough to become unemployed. That is a risk everyone faces at the present time.

Mr Bungey:

– That has been fixed, hasn’t it?


-If it has, the Department of Social Security has not been told about it. It is still sending out Bills to young men and women for them to repay up to $600 in unemployment benefits because of cheques they have received from the Defence Force for service in the reserves. That can be fixed if the Government wishes to fix it. It certainly should be fixed, morally if .for no other reason. If it is a tax free income it certainly should be a means test free income. The reserves will not attract an additional 6,000 persons, unless they are substantially changed and unless the equipment base is substantially improved and unless the activities of the reserves closely resemble those of the actual Defence Force. Going back to the earlier remarks about artillery, my understanding at this stage is that plans for the acquisition of new artillery which were drawn up did not include the purchase of sufficient weapons for those battalions in the reserves which operate as artillery units to have the more modern weapons.

Mr Killen:

– I don ‘t know who is advising you.


-I am informing the Minister only of what is seen to be the fact by those people actually involved. The turnover of manpower at the non-officer level in the Army Reserve at the moment is at an average of 11 months. The numbers which are indicated by the Minister as existing in the reserve are a total number and do not reflect the actual number of active members of the reserve by a considerable margin.

Mr Killen:

– It is infinitely better today than it was in the day of the Labor Government.


-The Government still will not attract 6,000 more members. If it gets 6,000 more there will be 22,000 as is claimed now, not the 30,000 which the Government is projecting.

Mr Bungey:

-We will get 30,000.


-The honourable member for Canning obviously believes in conscription, but I do not. The statement made by the Minister for Defence also makes at least one announcement which I noted which was not contained in the Prime Minister’s statement; that is that the Government intends to purchase an additional 10 patrol boats. The Minister does not elaborate on that proposal nor does he indicate in the case of the additional replenishment vessel or the additional oceanographic vessel when or where those vessels will in fact be purchased or constructed. I would imagine that they would be a follow-on to existing programs if they are of the same capacity and same type. I suggest to the House that there is probably a very sound case for examining whether or not, because of the very long reaches and the fact that we are likely to have major installations well off the Western Australian coast, there is not an argument for looking at least at some much larger patrol boat types which would have a better sea-keeping capacity, especially in relation to the North West Cape and the distances between existing facilities on the west coast of Australia. It would seem that there is a significant difference between the east and north coasts of Australia and the west coast of Australia as far as surveillance and patrol vessels are concerned. This statement by the Minister, unlike the 1976 statement, makes no mentioned of the establishment of a patrol boat base on the north-west coast of Western Australia. The Darwin project is about to get under way. I note that the Minister has mentioned -

Mr Bungey:

– And Townsville.


-Yes, but it is not on the west coast. The Minister has indicated that airport facilities at Learmonth will be considerably strengthened and thai an all capacity airport will be constructed at Derby. That would be a fairly direct consequence of the acquisition of Yampi Sound as a training area, and it is a necessity. There is still a necessity to have patrol boat servicing facilities available in the area between Perth and Darwin. That is not mentioned in the statement.

Mr Bungey:

– Port Hedland?


-I will not say. I understood that it was to be at Broome, but that is a matter of choice. It is for the technical people, not for me, to decide what is the most suitable location. A couple of other matters ought to be raised but I do not intend to prolong the debate at this stage. The Minister has indicated that it is the intention of the Department of Defence to acquire the Mort Bay facilities in Sydney for its use. Given the location, obviously that would be advantageous. However, I would point out, as the Minister took the trouble to indicate that a land grab was not involved, that I understand that a deputation to the Minister relating to that area has been arranged by the Leichhardt Council, the honourable member for Sydney (Mr Les McMahon) and the Government of New South Wales. The swap, as set out by the Minister, is not quite as clear cut as he would indicate. He is swapping an area of land on the southern side of Port Jackson for an an area of land on the northern side of Port Jackson. The people who live on each side of the Sydney Harbour Bridge are not necessarily of the same view.

Mr Killen:

– Sydneyites would have the Navy at Broome.


– I raised this matter because I understood that the Minister was involved in negotiations. Apparently he has just cut off negotiations, diplomatic or otherwise. The statement which has been presented to the House is one of encouragement. The Minister indicates that the Government intends to pursue a policy of upgrading and developing the capacity of the Australian Defence Force. Unfortunately, we will have to await the fulfilment of the statement. Earlier statements of the same nature have not been fulfilled. Certainly there are serious holes in the costing of the program. I would like to see a more detailed statement as to how the Minister arrives at the figures of 25 per cent of the defence budget for equipment and 55 per cent for manpower and fits the rest of the defence activities of the nation into the other 20 per cent of the defence budget. I would find that difficult arithmetically or in any other form. This statement indicates that that is the intention of the Government.

The program is padded a little in that it announces projects which do not fall within the five-year term that it is anticipated to cover. It stretches well beyond what one would call an emergency situation for defence equipment acquisition. There is a number of other areas about which questions ought to be asked. I am concerned about the lack of any indication of increased capacity or modernisation for the Australian Army. The statement is almost devoid of those things which were mentioned even in the 1976 program. The Army is to be left in a fairly parlous position if this is the total five-year program. There is no indication of an overall plan in the statement of the Minister. As I indicated earlier, laid out as a defence proposal one would find that these acquisitions have a piecemeal approach and do not result in a collective whole. I trust that we will be able to examine this program in more detail. I am concerned about the passing reference by the Minister late in his statement to what I assume to be inquiries by committees of this Parliament. He indicated that they were a hindrance to the defence program and should be desisted from. That is the only interpretation that one can place on those remarks.

Mr Killen:

– We are not a congress.


-I acknowledge that we are not a congress, but, while the Minister accepts responsibility to the nation for defence, every member of this Parliament collectively accepts responsibility for ensuring that the Minister carries out his task and, therefore, is entitled to ask for and seek information by whatever means are available. I do not think it is an imposition on the Department of Defence, which spends a significant proportion of the country’s funds, to require that Department to indicate how it is allocating the funds. Defence spending is not always spending which is covered by rationale, economy or any of the other criteria with which we would like to think we cover other departments. The Department of Defence is just as prone to be wasteful in the expenditure of funds as any other department. It has the same human weaknesses, is manned by the same human beings, and is administered by the same politicians, be they one side or the other of politics, in any given period. The Parliament has a right to examine this expenditure. I do not think for one moment that it becomes the Minister to suggest that it does not.

Debate (on motion by Mr Bungey) adjourned.

page 1152


Assent to the following Bills reported:

Defence Service Homes Amendment Bill 1980.

Loan (War Service Land Settlement) Bill 1 980.

Commonwealth Grants Commission Amendment Bill 1980.

Commonwealth Serum Laboratories Amendment Bill 1980.

page 1152




– In accordance with the provisions of the Public Works Committee Act 1969, 1 present the forty-third general report of the Parliamentary Standing Committee on Public Works.

Ordered that the report be printed.


– by leave- This general report summarises the Public Works Committee ‘s activity during 1979. It highlights the fact that the Government’s rejection of the Committee’s report on the Defence Force academy, as announced by the Minister for Defence (Mr Killen) on 7 December 1979, was not accompanied by the Government’s reason for its decision. The Government’s action appears to disregard the Parliament and indeed appears to attack the basis of the parliamentary committee system.

In its report, the Committee also draws the attention of the Government to the need to give immediate consideration to amending the Public Works Committee Act along the lines recommended by the interdepartmental committee of 1974. The Committee is concerned that no action has been taken on this long outstanding matter. Under the provisions of the current Act, the Committee is prevented from inquiring into much of the capital expenditure of the Commonwealth Government, especially that expended by the National Capital Development Commission and by various non-commercial statutory authorities. The interdepartmental committee particularly recommended the extension of the powers of the Committee into such areas, and such extension would enable more satisfactory parliamentary scrutiny of capital expenditure by the Commonwealth.

Mr Keith Johnson:

-by leaveInitially, I would like to thank the Chairman of the Parliamentary Standing Committee on Public Works- the honourable member for Canning (Mr Bungey)- for the way in which he has conducted the Committee’s hearings over the last 12 months. He has done a sterling job. The Committee has been quite forthright in its forty-third general report. We are really speaking about the very crux of the parliamentary committee system. It might well be said by the Parliament- it was said by the then Minister for Transport when the report on the Brisbane Airport project was forthcoming- that this project was the policy of the Government and that the Government would implement its policy. That seems to be a complete denigration of the role of parliamentary committees. The committees are not here to make decisions on behalf of government. The Public Works Committee, in a very public way, examined projects that were referred to it by the Parliament and examined them in every detail. I would like to take the time of the House to read a very pertinent part of the Public Works Committee Act. It appears on page 2 of the Public Works Committee report under paragraph 6. It states:

In considering and reporting on a public work, the Committee shall have regard to:

the stated purpose of the work and its suitability for that purpose;

the necessity for, or the advisability of, carrying out the work;

the most effective use that can be made, in the carrying out of the work, of the moneys to be expended on the work;

where the work purports to be of a revenueproducing character, the amount of revenue that it may reasonably be expected to produce; and

the present and prospective public value of the work.

That is a rather broad charter, if honourable members read and understand it. The Public Works Committee, in all of my years of service on it, has always taken its role very seriously and has endeavoured to honour its obligations to this House. I ask honourable members to remember that it is only one of two committees of this Parliament that operates under statute. That part of the Act shows what the Committee is charged with. Accepting that responsibility very seriously, as the Public Works Committee does, it ill becomes the Government to say to the Committee -as departmental witnesses have been guilty of saying under oath in their submissions of evidence to the Committee- that this is Government policy and, therefore, that is the end of the submission. That is not good enough. I do not believe that the Government is infallible. For that matter I do not believe that any government is infallible. I am not trying to play party politics here because this Committee is biparty, bicameral, and therefore it expresses the view, if you like, in microscopic form, of the Parliament.

There must be something wrong with the decision making process in this country when the Prime Minister (Mr Malcolm Fraser), without consultation with anybody, can stand up at an election meeting and declare that his Government is going to spend $192m on redeveloping Brisbane Airport. The Parliament then referred that matter to the Public Works Committee for investigation. The Committee held hearings over a period of somewhere near five days in Brisbane and Canberra, examined a whole host of witnesses, all under oath- this has reported to the

Parliament- and without exception the Committee obtained the view from all of the evidence by all of those witnesses that the project was premature, that the date for commencement of work was too early and that it could be constructed at a later time with consequent cost savings to the community.

The then Minister for Transport (Mr Nixon) in his statement to the chamber said that he did not think the Committee had understood everything that had been said to it. That was a nice old slight to some nine people who, in all their honesty had listened to evidence for up to nine or ten hours a day, assessed it and, on that occasion, used the services of a competent assessor in order to sort out the multitude of information that was given to the Committee. The members used their inate intelligence and experience in this area and came to a unanimous decision. The Government then said: ‘We do not care what the Committee says anyway. We promised this in an election campaign so we are going to go ahead and do it’. The burr under the Committee’s saddle was the proposed Australian Defence Force Academy which occupied 12 months of the Committee’s time. I want to explain that this Committee can meet only when the Parliament is not sitting. Therefore the members attend Committee meetings in the times when other members are attending to other duties. The time available to the Committee is rather limited.

For 12 months the Committee sat in many places and listened to evidence and read reams of transcript of evidence which was subsequently prepared. I would like to take honourable members back to the words which I used earlier in relation to section 17 (3) of the Public Works Committee Act. The Committee came to the unanimous decision that there were some very real doubts about the project. The Committee not only said that but also gave alternative recommendations. It was a little annoying to sit at home and hear on the radio or read in the Press on 7 December 1979 the statement of the Minister for Defence. That was a very important date because the Parliament was in recess. No word had been said by the Government while the Parliament was in session, when the Committee could defend its position in the Parliament. But when the Parliament was out of session the Minister for Defence made a statement on 7 December 1979 that the Government would proceed with a Defence Force Academy against the advice of the Parliamentary Public Works Committee. It intended to disregard that advice. He said that the Parliament would be informed as to the Government’s reasons for not accepting the Public Works Committee report. The Minister for Defence is not in the chamber but I remind honourable members that today is 25 March. The Parliament has been sitting since early in February but still there has been no statement made by the Minister. He has not honoured the statement that the Parliament would be informed. He said that the location, the time and details of the construction of the Academy remained for further consideration.

I use this opportunity to draw to the attention of the House the fact that if this sort of practice is to continue it will mean that the Public Works Committee has made its decision on the Defence Force Academy based on bad advice, or alternatively, that it received bad advice. But our advice is based on the transcript of evidence and any Australian can read it. I do not know what advice the Government received because it is not available to the Australian community. It has not been made available to the Australian Parliament. I support the decisions of the Parliamentary Public Works Committee on that occasion, as I do on all occasions. It is very dangerous for the Minister for Defence or for any Government Minister to simply come into the chamber and blithely override the decisions of any committee of this Parliament- not necessarily the Public Works Committee- without giving reasons as to why the decision or recommendations made are not acceptable to the Government. That has not been done. There is no indication that it ever will be done.

The columns of our daily newspapers have been filled with comment about the folly of the Defence Force Academy by letters to the editor, editorials and special articles by journalists and comments by people engaged in the academic field. I do not claim to be right on all occasions. I agree entirely with the Public Works Committee on that issue. If I am wrong I would like to be told where I am wrong. I would like to be told where the fallacy is in my reasoning. I have not had the opportunity. I hope that the Government reads this report and takes some notice of it. Just to elaborate on that a little- I will not take up much more time of the House -

Mr Garland:

– Hear, hear!

Mr Keith Johnson:

-The Minister can say; ‘hear, hear’ if the matter is of little interest to him. He does not care very much whether the parliamentary committee system falls down. I rather suspect it was the Minister for Business and Consumer Affairs who said that. Of course he does not want public scrutiny of what he is doing. Of course he would say: ‘Hear, hear’ because he does not want exposure of these facts. The other matter that needs to be examined is raised by the Committee in paragraph 13 of the report. For example, in the case of the Defence Force Academy I am not obliged to tell the House how much money was spent in developing the matter to a point where it came before the Public Works Committee, but it was a very large sum. It would even make the hair of the Minister who said: ‘Hear, hear’ stand on end. Yet all of that money, if the Parliament agrees with the Public Works Committee, has been wasted.

I think careful attention should be given to that part of the report- paragraph 13- as to a better and more efficient way for the Committee to go about its work. This Committee is not an obstructive one. It has an entitlement to bring down a report on the basis of evidence presented to it. If that appears to be obstructive then I make no apology for it because we are dealing with very large sums of public money. The Committee is co-operative in every way. Before the end of this year, it will demonstrate to the Parliament how co-operative it is. It intends to get its work done as quickly and as efficiently as possible. It needs assistance in that area. It will always feel offended if, without any explanation at all, the Executive uses its weight in the Cabinet room to ride roughshod over the Parliament. Such action is not good enough. The Parliamentary Committee system ought to be defended under all circumstances.

page 1154




-by leave-I present the report of the Australian Delegation to the Inter-Parliamentary Union Conferences in 1979.

Ordered that the report be printed.


-I seek leave to make a short statement in connection with the report.

Leave granted.


-The activities of the InterParliamentary Union in 1979 as set out in this Report should command the interest and strong support of all honourable members and honourable senators in the Parliament. The InterParliamentary Union dates back to 1899. The meeting held in Caracas in September last year was the 66th Annual Conference of the Union. The IPU is a world wide organisation of parliaments. Indeed, it is the only such world wide organisation. The membership currently stands at national groups from 88 countries, as listed in the

Report. The United Nations, of course, is an organisation of governments and commands resources, clout and world attention accordingly. In this respect the IPU should be seen as one significant body complementing the work of the United Nations, in particular as transmitter of its concerns at the national level, and thus helping to implement decisions taken by the United Nations.

In fact, the IPU has been leader, initiator, as well as transmitter. There have been some notable early initiatives but I refer here to its contributions- springing from a resolution of the 59th conference at Paris in September 1971- to the formulation and acceptance by governments of the Helsinki Agreements to facilitate the rapprochement and co-operation between European countries with different political and economic systems. Many of the IPU’s suggestions were included in the Helsinki Final Act which was adopted in 1975, and the IPU has been active in its implementation since then.

I say this because it bears on a point that needs to be recognised, namely, that viewed through Western eyes there is inevitably some scepticism and perhaps an air of unreality and incongruity about an organisation of ‘parliaments ‘ from such a range of countries as the present membership of the IPU, including as it does most countries of the Eastern bloc as well as other states that have hardly a claim to the practice of parliamentary democracy as we know it. However, the approach of the Union in this matter which has resulted in the present membership is in fact the challenge and the strength of the organisation, as the contribution to the Helsinki Agreements bears witness.

One does not have to participate in the IPU for very long to appreciate the great store which Western European countries in particular and states generally set on the Union as a major forum for the exchange of views and some meeting of minds on East- West issues- the strategic balance, the balance of power, between the super powers, arms control and disarmament. Here in Australia we are very remote from the world scene and the day to day consciousness of these great issues, at least until recently. The Russian invasion of Afghanistan has perhaps heightened our awareness. What is important in this respect is that the wide membership of the IPU provides a base from which to work within the limits of the concerns and influence of the IPU at bridging in some measure and on some issues the differences in ideologies and political systems as between East and West. I add in parenthesis that it can be very frustrating work, as the episode described on pages 2 1 and 22 of the report bears witness.

The dominant topic in the East- West context, as I have said, is disarmament and arms control. The thrust of debate on that subject, as set out on pages 15 and 16 of the report, is not untypical. But notwithstanding the disagreement on broad approach, there was without any qualification, general agreement on the desirability of the early ratification of the Strategic Arms Limitation Treaty- SALT II- which was signed by Messrs Carter and Brezhnev of June last year. The need for the early ratification of the SALT II agreement was the unanimous view of the parliaments of 80 countries.

It is said in some quarters that it is a soft Treaty which is to the disadvantage of the Americans and the West. I doubt whether that view is shar.ged by anyone close to the matter, including the United States Chiefs of Staff. I believe that it is salutatory from time to time to reflect on the awesome, almost unimaginable, dimensions, the dead weight of enormous cost, and the unimaginable horror if they were ever let loose in earnest, of the strategic nuclear arsenals of the super powers. The SALT Treaty spells out realistically and with a maturity yet to be evidenced in other spheres, the dimensions of an agreed equilibrium, and provides so far as humanly possible for its control and verification. Has the Russian invasion of Afghanistan changed this situation? I think not. The Treaty is shelved, not as punishment of the Russians, but because the invasion has reduced the chances in a United States election year of getting it ratified in the United States Senate. The Treaty should command the continuing support of parliaments everywhere.

If the IPU is the forum for East- West issues, it is also an important forum for the furtherance of the so-called North-South dialogue-that is, Third World issues. The inter-relationship of EastWest and North-South issues is starkly brought out when the two issues are debated together, as has been the case at recent IPU conferencesand is again central to the agenda for the forthcoming 1980 conference with energy issues adding new dimensions to the problems. The massive spending on arms stands in sombre and dramatic contrast to the want and poverty of two-thirds of the world’s population. The United Nations, the IPU, and, most recently and authoritatively, the Brandt Commission join in urging a massive increase in assistance to developing countries.

Yet in urging increases in assistance to developing countries, the dilemma of our times is pointed up by the fact that in 1975- the latest year for which I have a figure- the non-OPEC developing countries received some $17 billion in official aid and, at the same time, spent some $24 billion in the military area- more than the total of what they spent on health, education and welfare put together. One would like a formula which ties increased aid to reduced military expenditure, but that is in the realms of a dreamworld. In the real world there is no course open other than to push ahead in both areas simultaneously.

Of course, the IPU conferences do not cover all the activities of the Inter-Parliamentary Union. As well as its consideration of major world issues, the IPU makes a continuing contribution in more specific areas. In particular, it has a program of assistance to parliamentarians who are in prison or otherwise subject to persecution. The work of its Special Committee on Violations of the Human Rights of Parliamentarians is referred to at pages 54, 55 and 69 of the report. During 1 978 the work of the Union, and of particular national Groups as requested by the Inter-Parliamentary Council contributed to the release of seven imprisoned parliamentarians. More recently, the case of Mr Lee Tee Tong of Singapore was of particular concern at Caracas. It is gratifying to note that recently Mr Lee was released from prison.

In conclusion, I wish to thank the deputy leader of the Delegation, the Honourable Charles Jones, the Labor member for Newcastle, and the other members of the Delegation for their work and support. It was not always a bed of roses; there were some strong difference of opinion. But in total we made an Australian presence strongly felt. I am pleased to report that at the Prague meeting I was elected as Joint ViceChairman and the Australian Delegation was thereby honoured- of the Economic and Social Committee of the Union. Unhappily, my tenure in that office will be short lived when my term as continuing member of the Australian delegation expires at the next election. I also express my thanks to the advisers to the Delegation- Mr Michael Thawley at Prague and Miss Sue Boyd at Caracas- and to the secretary, Mr H. C. Nicholls, for the high standard of their work. I thank the House.

Mr Charles Jones:

-by leave- I support the report that has just been presented and the remarks of the leader of the Australian delegation to the Inter-Parliamentary Union, the honourable member for Berowra (Dr

Edwards). The Inter-Parliamentary Union is an organisation of parliamentarians from some 88 countries. In the two years that I have been the deputy leader of the delegation, the Union has reminded me very much of an Australian Labor Party branch after a new member has been elected, the way they have been stacking the branches of late.

Dr Jenkins:

– That is New South Wales, not Victoria.

Mr Charles Jones:

-The former assistant secretary would know of the stacking of the branches. That is no reflection on the former assistant secretary, but in that position he would know of what goes on. At the IPU the battle for numbers has been going on in earnest over the last two years. I feel that the intensity of debate has built up and that greater confrontation has been taking place. The result is that delegations have been getting their friends to join the IPU. Consequently, at each session, whether it be of the Council or of the Conference, three, four or five new nations have joined the InterParliamentary Union. When we left Caracas 88 countries were associated with it. All of them take an important role and put forward their point of view.

One of the intriguing things is that if one looks through the 88 countries one sees that, at best, only about 30 of them have any form of democratically elected government. Some are members of the eastern bloc where one can vote for whom one likes as long as he is a member of a particular political party. The same thing can be said for some of the South American countries and for some of the African countries. Although we are talking about a meeting of parliamentarians, they are a fairly well locked in group of parliamentarians when one realises that 58 nondemocratic countries are represented. The result is that when a vote is taken delegates from such countries all put up their hands at the same time for the same resolution. However, I am pleased to say that members of the Australian delegation on occasions have voted differently from one another because we have had our own points of view, and I hope that that will never be changed. I hope that whenever members of this Parliament go to the Inter-Parliamentary Union or to the Commonwealth Parliamentary Association they will be free to express their points of view. Delegates to the Union have said to me: ‘How come you voted differently from Dr Edwards?’ I said: ‘For the one simple reason that we have a hell of a set-up in Australia. At least we have some form of democracy where a man can still say what he wants to’. That is the situation as it stands.

I propose not to go through the report item by item but to bring to the attention of honourable members my experience of the committees that I had the privilege of sitting on. There were three lively committees, one dealing with disarmament, one with decolonisation and one with the Middle East. I was fortunate enough to be a member of two of those committees. I feel that other committees were more harmonious and talked about economic issues, the International Year of the Child and things of that type, whereas at all times the delegates on the decolonisation committee who were taking part in discussion and in the drafting of resolutions were looking at what was happening in neighbouring countries with a view of the sort of propaganda resolution that they could put together. It was obvious time and time again that resolutions which were amended and amendments which were moved to draft reports were directed wholly and solely at the propaganda war that is going on in the drive for decolonisation. At the same time people were forgetting about recolonisation. On behalf of the four delegates who were in attendance- this is one issue on which the Australian delegation was divided as to its support- I was fortunate enough to be successful in moving two amendments at the committee stage, one with respect to the preamble to the resolution on decolonisation one dealing specifically with East Timor. This is listed in the report but I think it is worthy of mention. We had included in the preamble the following words:

Considering the resolution adopted by the United Nations on East Timor (resolutions 33-39 of 13 December 1978), which reaffirms the inalienable right of the people of East Timor to self-determination and independence.

That was carried with 29 votes for, five against and 12 abstentions. I will deal with the abstentions in a minute. In the operative paragraph of the resolution we had included the following words:

Recalls the responsibility of the United Nations with regard to the decolonisation of East Timor, in accordance with the principles of the Charter and relevant resolutions of the United Nations, and calls upon all parties concerned in the East Timor problem to refrain from using force and to cooperate in reaching acceptable solutions;

That was carried with 28 votes for, seven against and six abstentions. I think an important point to bear in mind is that the United States of America, being one of those that abstained, for the first time did not vote with the Indonesians on the East Timor situation. In the United Nations the United States has supported the

Indonesian position time and time again. The same thing could be said about the British delegation. Although the British delegate to this committee was a Conservative member, Britain likewise abstained on this resolution. I think an understanding could be creeping into other countries that something has to be done with regard to East Timor. I note with pleasure that those delegations voted the way they did.

The other committee which involved considerable confrontation and dissension was the Middle East committee. The drafting committee consisted of delegates from 13 nations. They reached an amicable agreement with only one dissenting vote; the Israeli delegation abstained from voting. When that resolution, which had received unanimous support in the drafting committee, was brought into the full committee for adoption we saw it fall apart. For example, the chairman of the drafting committee, a Yugoslav delegate, started to move amendments to it and other countries which had supported it moved amendments to particular clauses. The final outcome was that a Mr Chandernagor, a French delegate and rapporteur of the committee, gathered up his papers and said: ‘I do not know why we wasted all those hours in the drafting committee in putting together a consensus when this is what you people are going to do’. He then proceeded to walk out. It was with great difficulty that we got someone to report the matter to the conference.

That was typical of what happened both in Prague and in Bonn. In drafting committees there were agreements and understandings and deals were done between countries on both sides, but when matters came into the full committee there was double crossing. After giving ground on particular points delegates were able to get away with amendments which under normal circumstances would not have gone through the drafting committee. At the conclusion of the debate in the drafting committee on the Middle East situation, and before the resolution was adopted, I indicated that I considered the drafting committee’s recommendation to be a most even-handed recommendation which, although it was slightly biased against Israel, was good enough to support in its entirety. A number of other countries followed the same line and whenever amendments to it were moved we either voted against them or abstained.

By the time the conference had adjourned, I had built up a talking relationship with some of the delegates to the conference, particularly an Arab delegate who gave me a quotation which, translated into English, went something along these lines: ‘Lord protect me from my friends; I can cope with my enemies’. They said that they had no alternative but to vote for the amendments moved to the resolutions, otherwise they would have been put in an embarrassing situation. I draw the attention of honourable members to my opening remarks. I said that a lot of the decisions, a lot of the speeches and a lot of the motions that are moved at these conferences are political in the sense that each faction, whether it be from the Left or the Right or from the north or the south, is looking at a particular situation that exists in a country it is supporting in its attempts to gain whatever that country is after. This was the situation as far as the Middle East was concerned.

Another matter dealt with by the conference was the human rights of parliamentarians. The committee that deals with this matter has done a particularly good job in trying to assist parliamentarians whenever there has been a changeover in the control of a country and members of governments have been imprisoned. That committee has done a particularly good job on the question of human rights of parliamentarians. Singapore one of our near neighbours, one of our friendly neighbours, has a hell of a problem on its hands in the case of Lee Tee Tong. I wish Singapore luck in what it is trying to achieve but I think it really has a battle in front of it.

Mr Bourchier:

– What happened on the second day, Charlie?

Mr Charles Jones:

-The Government Whip can sing, he can dance and he can prance around all he likes.

Mr Bourchier:

– In that case, Mr Deputy Speaker, I move:

Question resolved in the negative.

Mr Charles Jones:

-Bourchier, you are the lowest thing in this Parliament.

Mr DEPUTY SPEAKER (Mr MillarOrder! The honourable member for Newcastle will desist.

Mr Bourchier:

- Mr Deputy Speaker, you should ask the honourable member for Newcastle to withdraw. How can a person who is lower than I am say that?


-Order! The honourable member for Bendigo will resume his seat. The honourable member for Newcastle will no doubt be eager to withdraw.

Mr Charles Jones:

-Mr Deputy Speaker, as a delegate from this Parliament to this conference I was giving this Parliament a conscientious report -


-Order! The honourable member is required to withdraw.

Mr Charles Jones:

-And this is the first time I can ever recall this action being taken by the Whip of any government.


-Order! The House will no doubt form a view of the matter. The honourable member is required to withdraw the offensive expression.

Mr Charles Jones:

-The House knows my views. I withdraw.

Opposition members- What about the division?

Mr Charles Jones:

-Mr Deputy Speaker, is there to be a vote oris there not?


-The honourable member for Newcastle was at liberty to continue his remarks but he appeared to indicate that he had no further desire to do so.

Opposition members- No!

Mr Bourchier:

– But, Mr Deputy Speaker, I moved that the honourable member for Newcastle be not further heard.

Honourable members:

Honourable members interjecting-


-Order! The House will come to order.

Mr Bourchier:

– Therefore, Mr Deputy Speaker, I move once again:

That the honourable member be not further heard.


-The honourable member is seeking to reverse the decision of the House. I call the honourable member for Newcastle.

Mr Charles Jones:

-I thank the House for its courtesy. As I had almost completed my remarks, I will now be very brief. I join with the leader of the delegation in expressing my appreciation to him as leader of the delegation and also to the two advisers with us.

Mr Bourchier:

- Mr Deputy Speaker, I take a point of order. I moved that the honourable member be not further heard. There were voices on this side of the House to indicate that we wanted to have a vote.


-Order! The honourable member for Bendigo will resume his seat.

Mr Bourchier:

– But we had asked for a vote.


-There is no point of order. I call the honourable member for Newcastle.

Mr Bourchier:

- Mr Deputy Speaker, I would like to know what you require in order for there to be a vote. The Standing Orders quite clearly say that if two voices call for a division a vote must be taken, and there were two such voices from this side of the House.


-Order! The honourable member for Bendigo will resume his seat. The question was put and determined on the voices. As far as the Chair is concerned, there was no indication that a division was required.

Mr Bourchier:

– I beg your pardon, Mr Deputy Speaker; a division was required.

Mr Charles Jones:

-As I was saying, I want to express my appreciation to all the people associated with the delegation, including the Foreign Affairs advisers and the secretary of the delegation. There is a couple of little points that I would like to make. One is that if the Parliament is to treat the Inter-Parliamentary Union Conference as a serious conference, as I believe it should, then it is time that the Parliament gave consideration to appointing the leader and the deputy leader of the delegation- I am not talking about the honourable member for Berowra and myself on this occasion; I am talking about future delegates- for at least three years and preferably five years so that they will have time to get to know and to understand the workings of the Inter-Parliamentary Union and can advise the other people who are going to the conferences as delegates. Other countries do this; they have permanent delegates who are there for years. It takes at least 12 months to get to know and understand the workings of the conference and to make contacts and get to know people at the conference. The position with the leaders of the Australian delegation, whether they be from the Liberal Party or the Labor Party, is that by that time their time has run out and they are out. If the Government of the day decides to call an early election or if a member is appointed halfway through the conference by reason of somebody taking sick, it means that a new man is there all the time. I do not think that is good enough. I think this matter should be taken into consideration.

I raise another matter about which I think honourable members will agree with me. Ever since Australia has been a member of the InterParliamentary Union- that is, since 1956- the secretariat has been located in the Senate. I believe it is time to reverse the situation and locate the secretariat in the House of Representatives. I just make those two suggestions for the consideration of honourable members. I do it with no thought of spleen or vindictiveness towards the members of the Senate.

Mr Bourchier:

- Mr Deputy Speaker, I only want an explanation. What do I have to say in order for this side of the House to call for a division?


Order! The honourable member for Bendigo is not entitled to address the Chair in that manner. If he seeks information on that matter he has recourse to the Standing Orders.


-by leave-My comments will be brief. The honourable member for Berowra (Dr Edwards) and the honourable member for Newcastle (Mr Charles Jones) have covered very fully the work of the Australian delegation to the Inter-Parliamentary Union Conference, but I want to make a very brief statement of my own because this was the very first occasion on which I had the very great honour to be a member of a delegation led by the honourable member for Berowra and the deputy leader, the honourable member for Newcastle. It was the very first occasion on which I, as a comparatively young member of the Australian Parliament, had an opportunity to represent Australia at an international conference.

Opposition members interjecting-


– I am very sorry that honourable members opposite are not prepared to extend to me the courtesy which I extended to my colleague, the honourable member for Newcastle (Mr Charles Jones) while he was making his report. Regettably members of the Australian Labor Party are not prepared to hear a Government member’s view in regard to the context.

Dr Klugman:

– I raise a point of order, Mr Deputy Speaker. It is quite clear that the Government Whip, who has just come in, threatened you. That is completely unparliamentary and you should take immediate steps to deal with him. It is quite ridiculous that the Government Whip should have lost his temper because he could not get support from his own side. He is prepared to come in here and threaten you.


-The honourable member for Prospect will resume his seat. The honourable member is quite presumptious to draw conclusions as to what may have transpired or have been said.


– Notwithstanding the comments from the Opposition, I do wish to give a brief report as a member of the Australian parliamentary delegation to that conference. Whether they agree or disagree with what I say, I intend to say it. Firstly, the honourable member for Newcastle made a very valid comment when he said that the quality of the Australian delegation and its impact on that conference was very substantial indeed. In fact, it ought to be recorded in Hansard that the voice of Australia in the debates at the IPU conference in Caracas was a much louder one than would normally have been expected from a country of our size, in our region of the world. That is a compliment to all members of the delegation, regardless of their party political background.

Secondly, the House should note the singular honour that is being conferred by the IPU on the honourable member for Berowra. His appointment is not, as he said, simply an honour received by him or by the Australian delegation; it is rather one received by the Australian nation. The honourable member for Berowra and the honourable member for Newcastle have worked long and hard in respect of IPU matters. I believe that the appointment of the honourable member for Berowra is something of which all Australians should be proud, and I hope they will be, regardless of their party political background. I wish to refer to only two other matters. In the course of the deliberations of the committee on political questions, disarmament and international security, two amendments were moved by the delegation from the Union of Soviet Socialist Republics, which was headed by Mr Ruben, with respect to the draft declarations which had been settled at the Conference in Prague earlier last year. I simply want to place on record that Australia was asked to put the case in opposition to one amendment on behalf of the United States, the United Kingdom, Canada and New Zealand. That amendment moved by the USSR was defeated by 25 votes to eight. Also Australia was requested to put the case on behalf of the West in respect of another amendment proposed by the USSR with a similar result.

Dr Edwards:

– Who actually put the case?


– The honourable member embarrasses me. The case was put to the committee by Australia. I appreciate the honourable member’s interjection. My point is that in respect of those two amendments there was appreciation that the work done by the Australian delegation at Prague, and again at Caracas, was of sufficient value to warrant Australia’s being invited to put the case against the USSR amendments, and in each instance Australia’s view was overwhelmingly accepted. Secondly, I wish to refer to one small aspect of the report of the honourable member for Newcastle in relation to the Timor amendment. It is fair to say that, as would be well known to all members of the House, I was in sympathy with the amendment that was moved by the honourable member. It was one that he had every right to move. My only complaintperhaps it is a mild one but nevertheless should be on record- is that in future, in respect of possibly contentious matters in regard to which a delegation could be divided, it may be of advantage if they could be discussed in Australia before delegates go to such a conference. The question could then be sorted out and possible embarrassment avoided. I say that in a genuine sense because I was not unsympathetic to the amendment and indeed I supported the spirit of it.

Opposition members interjecting-


-The honourable member for Melbourne Ports (Mr Holding) has been quite unfair in that comment.

Mr Holding:

– In what comment?


-The comment that he just made. If the honourable member did not say anything, I am sorry. But someone over there just made the comment that I did not support the amendment. If that statement was made it was not true. If it was not made I have no complaint. If it was made I have a complaint.

Mr Barry Jones:

– You are hearing voices, like Joan of Arc.


– At least I have not lost my marbles, as your leader has. I conclude by commending to the Parliament the work of the InterParliamentary Union. I hope that it will grow from strength to strength. Like the honourable member for Newcastle, I am surprised that such a high proportion of the membership of the IPU does not come from parliamentary democracies. I believe it is the duty of those who do come from parliamentary democracies to apply what pressure they can, by reasoned argument, to persuade those who do not have that advantage to switch to that system. I congratulate the honourable member for Berowra and all members of the delegation. I believe that Australia came out of that conference with colours flying high and I hope that will continue at future conferences of the IPU.

page 1160


Message received from the Senate intimating that it had disagreed to the amendments made by the House of Representatives to this Bill and requesting that the Bill be reconsidered.

Motion (by Mr Garland) agreed to:

That the message be taken into consideration in committee of the whole House at the next sitting.

page 1161


Discussion of Matter of Public Importance


– 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 increasing degree of foreign ownership and control of Australian industry and resources under the Fraser Government.

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-

Morion (by Mr Hodges) proposed: That the business of the day be called on.

That the business of the day be called on.

Mr DEPUTY SPEAKER (Mr Millar)Order! I draw the attention of the House to the fact that the honourable member had not been called. I call the honourable member for Gellibrand.


-Ever since the Fraser Government came to office -

Motion (by Mr Fife) put:

That the business of the day be called on.

The House divided. (Mr Deputy Speaker-Mr P. C. Millar)

AYES: 71

NOES: 32

Majority……. 39



Question so resolved in the affirmative.

page 1161


Minister for Business and Consumer Affairs · Curtin · LP

– I move:

The customs tariff proposals I have just tabled relate to proposed alterations to the Customs Tariff Act 1966. The proposals contain tariff changes arising from the decision of the Government on the report by the Industries Assistance Commission on Removal of Primage Duty. The changes and new duties will apply from tomorrow. Primage is a duty of customs which applies to certain goods in addition to the normal customs duty. Primage duties were introduced in 1930 as a revenue measure and originally applied to almost every item in the tariff. Subsequent policy has aimed at the removal of primage or, where justified on industry assistance grounds, its incorporation in the relevant customs duty. As a result, most items in the customs tariff no longer attract primage duty.

In largely accepting the Industries Assistance Commission’s recommendations that primage duty be removed from a variety of products, the Government noted the Commission’s conclusions that such an action would not have significant impact on the industries concerned.

Where it is considered that there would be an adverse effect on the Australian industry, the relevant customs duty will be increased by the equivalent of the primage duty, and the primage duty will be removed. Rates of duty applying to developing countries will be similarly varied. Rates for goods from New Zealand remain unchanged in accord with our trade agreements with New Zealand. Similarly, rates for goods from-Papua New Guinea will remain unchanged with the exception of certain fruit juices and strawberries where an ad valorem rate of 3 per cent will be added to the existing rate of Customs duty. Whilst some primage duties will still remain in the customs tariff, they virtually all apply to goods covered by references now with the Industries Assistance Commission and, in accordance with established policy, will be considered when the relevant reports are received by the Government.

Announcement of the Government’s decision on this report was deferred last April pending completion of the wide-ranging tariff negotiations that took place last year within the context of Multilateral Trade Negotiations. These Negotiations have now been completed. It should be noted, however, that the reductions in duty arising from the Government’s decision on removal of primage duty are in line with the Commission’s recommendations and are not being made on account of the negotiations.

Also included in these proposals are changes arising from decisions of the Government on reports by the Industries Assistance Commission on the Australian citrus industry, the sugar industry and grapes and wine. As a result of these decisions primage duties applying to certain citrus products, sugars and beverages containing grape juice will be incorporated with the existing customs duties. A comprehensive summary setting out the nature of the duty changes contained in these proposals has been prepared and is being circulated to honourable members. I commend the proposals to the House.

Debate (on motion by Mr Willis) adjourned.

page 1162


Minister for Business and Consumer Affairs · Curtin · LP

– For the information of honourable members, I present the Industries Assistance Commission report on the Removal of Primage Duty.

Ordered that the report be printed.

page 1162


Second Reading

Debate resumed from 2 1 February, on motion by Mr Howard:

That the Bill be now read a second time.


– If it is all right with the Government Whip, I should like to make a speech in this second reading debate. The purpose of the Local Government (Personal Income Tax Sharing) Amendment Bill is to increase from 1.75 per cent to 2 per cent the proportion of total personal income tax receipts of the Commonwealth paid to local government in 1 980-8 1 . The Opposition welcomes and supports this modest amendment. In doing so, we note that this is a rather unique Bill. When it is passed, it will represent one of the very few election promises honoured by the Fraser Government. The promise made by the Prime Minister (Mr Malcolm Fraser) in his 1977 election policy speech was that, if elected, his Government would lift the share of personal income tax collections provided to local government authorities from the 1.52 per cent which applied at that time to 2 per cent within three years. In the next 20 months nothing was done, and local governments began to wonder whether this undertaking was going the way of innumerable other election promises. However, in last year’s Budget local government’s share of personal income tax was increased to 1.75 per cent, and under this Bill the process will be completed just in time for the 1980 election.

Direct assistance by the Commonwealth to local government was begun by the Labor Government in 1973. Before that, State governments were expected to provide for the needs of local government from the resources available to them, without specific and direct help from the Commonwealth. It is important, I believe, for the House and the public to recall that in the 23 years of office of conservative governments between 1949 and 1972, they provided local government with nothing in the way of untied grants and that this process was begun in 1 974 by the Labor Government. The amount granted by Labor in the first year was of the order of $40m, and that was doubled to approximately $80m in 1 975-76. As well, direct Commonwealth payments for a range of specific programs were increased quickly by the Labor Government, most notably for the Regional Employment Development scheme, which in 1975-76 involved the payment of $97m to local governments. In 1975-76, Commonwealth Government payments to or for local government authorities totalled $345m, compared with less than $ 100m in the last year of the McMahon Government.

In introducing this Bill the Treasurer (Mr Howard) deceptively misrepresented the situation. He claimed that the funds provided by the Commonwealth for local government had increased considerably since 1976, but he managed to defend this only by excluding funds provided under the RED scheme. He defended this exclusion by claiming that local authorities were used merely as a channel for disbursement of funds to assist employment. That is a completely misleading and inaccurate description of what happened. The RED scheme, which began in September 1974, was aimed at improving employment opportunities by developing suitable work programs. Under the scheme, financial assistance was provided towards expenditure on projects of economic and social benefit which provided employment for people who would otherwise have remained out of work. Local governments had to identify projects which fitted these criteria and apply to the Commonwealth Government for funding. Local government projects assisted under this scheme covered a wide range of its normal activities, including roadworks, improvements to sporting, recreational and tourist facilities, the establishment of community centres, and the whole gamut of other activities in which local government is engaged. What this meant, therefore, was that the funds made available under the RED scheme enabled local government to undertake more quickly normal projects which otherwise would have been long delayed. Local governments were delighted to be given access to this additional source of funds, both because they were enabled to improve the services they traditionally offered and also because this enabled them to reduce unemployment in their areas.

The Treasurer has no logical basis whatever for excluding payments to local government under the RED scheme. Those payments were extremely beneficial and useful for local government in pursuing its normal acitivies. Of course, the Treasurer has to make this artificial exclusion in order to support his case that Commonwealth payments to local government have increased under the Fraser Government. The fact is quite otherwise. The fact is that the real levels of funding for local government have been severely reduced by the Fraser Government since it came into office. I repeat: The fact is that the real levels of funding for local government have been severely reduced by the Fraser Government since it came into office. In 1975-76 total payments to local government authorities by the Commonwealth were $345m. In 1976-77, the first year in which the Fraser Government decided the allocation, payments by the Commonwealth to local government were reduced to $277m, or some $70m less than the amount for the previous year and, in real terms, a reduction of 28 per cent. The principal reasons for this severe reduction were the ending of grants for employment programs, the stopping of the area improvement program, despite an undertaking to keep it going- just another broken promiseand the winding back of the national -

Government members interjecting-

Hon. J. D. M. Dobie

– Order! There are far too many interjections and the level of conversation is too high. The honourable member for Gellibrand is entitled to be heard in silence.


– The level of conversation is all right, Mr Deputy Speaker. The level of interjection is too low. As I was saying, the principal reasons for this severe reduction, this 28 per cent reduction in the real level of funding in the first year of the Fraser Government, were the ending of grants for employment programs, the stopping of the area improvement program, despite an undertaking to keep it going- another broken promise- and the winding back of the national sewerage programs. Estimated Commonwealth payments to or for local government authorities this financial year, 1979-80, totalled $383m, a mere $38m more than in 1975-76, despite the fact that in that time prices have increased by approximately 50 per cent. The fact is that the Fraser Government has demonstrated little concern for the services provided to the community by local governments, and it has kept its provision of funds at depressed levels throughout the last four years.

The purchasing power of funds made available to local government by the Commonwealth is one-fifth lower this year than it was four years ago. I repeat that it is one-fifth lower in real terms this year than it was in the last year of the Labor Government. That is a clear example of what the Government’s new federalism policy really means. In reality, new federalism is an attack on State and local governments. The Prime Minister and his Ministry apparently have a doctrinaire belief that no matter what the value of services provided by State and local governments, the resources used for providing those services should be reduced. The Treasurer has tried to hide this reduction in real resources by pointing to the increased proportion of total resources given in the form of an untied grant. Labor supports increasing the proportion of total funds for local government which are given in the form of an untied grant. Labor’s platform commits the party to such a policy, but this tendency should not be allowed to distract attention from the fact that total payments to local government have fallen. Another way of showing this is by pointing out that payments to local government were 4.5 per cent of personal income tax receipts in 1 975-76, but will amount to only 3 per cent this financial year.

This Bill will not bring about much change in that situation. If the provision of this Bill, which will apply next financial year, had applied this year, local government would still have received only 3.25 per cent of personal income tax, which is far below Labor’s 4.5 per cent in its last year of office. In money terms, this would mean that total payments to local government this year would have been $34m higher than is the case, that is, if local government got the additional 0.25 per cent, but in real terms it would still have been 12.9 per cent below the real level of assistance in 1 975-76. There is no doubt whatever that there has been a very substantial reduction in funds to local government by this Fraser Government and that that situation will not be altered materially by the provisions of this Bill. The reduction in Federal assistance has a very important impact on local government. It means that as assistance from the Commonwealth is reduced, local government is forced either to reduce services or to increase its own revenue by raising local government rates. Rates are a substantial imposition on people, particularly low income home owners, and it is undesirable that they continue to rise. But that is what this Government’s policies are forcing on local government. If Commonwealth Government payments to local government, either directly or through the States, are cut back, it is inevitable local governments will have to increase rates considerably and that they will have to chop back services.

Over the three years from 1975-76 to 1978-79, local government has increased its tax receipts by some 40 per cent. Although this is in part a response to inflation, its effect is to make home ownership more difficult for many low income earners and particularly for the retired. The reduction of real Federal funds for local government is therefore a matter of real importance to the whole community. It directly affects the living standards of the Australian people through the impact it has on both local government taxes and services. Apart from this decline in overall Federal funds, local government is also concerned at the potential instability of Federal funding. In particular, it is concerned at the tying of general purpose assistance grants to a percentage of personal income tax receipts which could lead to instability in the level of those funds through the possible move by government to place greater emphasis on other forms of taxation. The rapid rise in petroleum taxation has naturally given force to those fears.

Thus, though local government will be guaranteed 2 per cent of personal income tax receipts it will not be certain that this will keep pace with its needs. If the emphasis changed substantially towards indirect taxation it could possibly face a real decline in its general purpose assistance grants. This will not be a problem under a Labor Government, however. It is our policy for these grants to be established at 2 per cent of personal income tax collections but that in the event of the real value of Federal net personal income tax collections ever falling between years, a Labor government would maintain at least the real value level of the previous year.

Another reason why local government bodies should receive more Federal assistance is that they are responsible for about one-third of total spending on roads in Australia. In fact, about 80 per cent of the Australian road network is the responsibility of local government. Yet last year payment to local government for roads was only about 6 per cent above the level in the previous year, less than the rate of inflation. Continuation of this trend would mean that road maintenance would suffer and that there would be too little new construction. There are already reports of some local governments ripping up bitumen roads because metal roads are cheaper to maintain. This is a clear example of the misguided economic policy of the Fraser Government. It is the responsibility of the national government to try to stabilise the economy. This means that when the national economy is depressed the Commonwealth Government should increase capital expenditure in a controlled way in order to counteract the state of depression. Spending on projects which will increase economic efficiency and economic security and reduce impoverishment and hardship should be increased to counteract the recession.

Increased spending on roads should be a natural aspect of such a program. Government capital works spending does more to stimulate all parts of the economy than any other form of public sector activity. Not only is employment increased directly and the standard of roads improved so that the economy runs more efficiently, but also sales by the companies which produce equipment and bitumen, road metal, cement, piping and so on are increased. Therefore the effects spread out into the whole community. Yet incredibly the Fraser Government has been reducing this form of spending. The Prime Minister’s doctrinaire approach to the public sector and public services leads him to attack them indiscriminately regardless of the consequences. The effect has been in this area that improvements to roads have occurred painfully slowly and that in some local government areas roads have been allowed to deteriorate.

A national road plan is needed which spells out objectives, sets specific targets and commits the Commonwealth to allocating minimum funds for each type of road for several years in advance. Such a national road strategy would ensure rational allocation of the limited funds which are available. As well, it would reduce uncertainty for construction companies by ensuring for them a minimum level of work for several years in advance. Local government authorities need adequate funds to construct and maintain an efficient road network. Present Commonwealth Government policies are denying them these funds to the cost, not only of motor vehicle owners, but also of a reduced level of economic activity throughout the country. A clear sign of this perverse approach is the decline in total employment by local government since 1 975.

In mid- 1975 the Australian Bureau of Statistics reported that local government employment totalled 141,000. A year later this figure had fallen to 121,000. Four years later, at the end of 1979, local government employment totalled 129,000, still 12,000 below the level of June 1975, despite the fact that the national level of unemployment has doubled. The Fraser Government’s refusal to give local government adequate funds is one of the reasons for this growth in unemployment. The foolishness and callousness of this policy would be unbelievable if it had not actually occurred. It has gone on for so long that many people are almost persuaded that it is normal. Yet Australia is unique amongst the industrialised market economies in failing to introduce comprehensive effective employment creation schemes. The Australian Council of Local Government Associations deserves praise for continuing to make detailed, reasonable and moderate proposals for employment creation programs to the Commonwealth Government. In March 1979 the Council sent to the then Minister for Employment and Youth Affairs a proposed employment scheme. In the preamble the submission stated:

Although official unemployment statistics indicate that some 6 per cent of the workforce is currently seeking work, it has been seriously suggested that the figure is really closer to 9 per cent when allowance is made for reducing participation in the workforce, short time working, and reduced overtime. Of special significance is the fact that unemployment amongst 1 6 to 1 9 year olds is running at a figure of around 1 7 percent.

That figure is now, of course, around 20 per cent. I believe that it is important for the House to note the point being made by the Council of Local Government Associations that not only do we have the official unemployment figures, which are bad enough, but also on top of that we have under-employment through people working in part time work when they wish to work full time. Most of the growth of jobs is in the part time work area of the present time. We have a hidden unemployment figure with people who have given up all hope of getting a job, are therefore not actively seeking work and are not counted as unemployed. The Council went on to describe the advantages that it considered could be expected from employment creation programs. These include and I quote from their proposal:

A reduction in personal hardships, demoralisation, social stigma, mental health problems, delinquency and the range of socially disruptive behaviour which chronic unemployment tends to produce; the short term opportunity to gain work skills and confidence to gain work experience enabling young people to make a more informed choice as to employment or further education; the creation of new assets and services for the benefit of the community; apart from those jobs opportunities directly created by Government funding, the multiplier effect resulting in the benefits being extended on a wider scale; and a reduced financial commitment by the Commonwealth to the payment of unemployment benefits . . . and in new incomes subject to taxation.

Those are benefits set out by the Council of Local Government Associations as flowing from the use of employment creating programs. It is salutary to remember that the organisation stating those advantages of a job creation program is the representative organisation for local government authorities throughout Australia, all of whom have had experience of such programs through the Regional Employment Development scheme that operated under the Labor Government. Clearly they saw that program as being very valuable indeed both for their own purposes and for the unemployed who gained employment through the scheme. The Council’s submission stated:

In most communities throughout Australia there are pressing needs for public works programs and community services which are unlikely to be met in the forseeable future from the resources of local councils of voluntary service groups.

It claimed an employment creation program could make:

A significant impact on this backlog of works and services and would, at the same time, be a positive step in providing job opportunities and employment experience for the unemployed.

The Council went on to outline a detailed proposal for the funding of an employment creation scheme in which all levels of government would be involved. But the Minister for Employment and Youth Affairs took over four months to reply to this proposal. When the reply came it was a complete rejection, saying in effect that it would be impossible to find any change of policy that would improve on the present situation. That of course is absolutely absurd and ridiculous for the Government to claim that nothing could improve on the present level of policies- policies which have created far more unemployment than existed when it took office. It is also inherently unreasonable for the Minister to claim as he did in his letter to the Council:

A careful study of the overall effects of publicly funded job creation schemes has convinced the Government that the short term benefits to the individuals who would be employed under such programs are a loser in the end.

That is what the Minister for Employment and Youth Affairs said in his reply to the Australian Council of Local Government Associations not so long ago. I say that that statement is absolute nonsense. It is contrary to the facts as established by the Minister’s Department. His Department has evaluated the Regional Employment Development scheme. The results of that evaluation have not been published but I have some evidence of the results. It shows that there are substantial benefits to be obtained by both the unemployed and the sponsors of the employment creation program through having such job creation schemes as the Regional Employment Development scheme. The Minister’s statement in that reply is absolutely and totally contrary to the advice of his Department.

Mr Dean:

– That is rot, and you know it.


-That is absolutely true.

Mr Dean:

– Your own party said that the RED scheme was no good, and you know it.

Mr DEPUTY SPEAKER (Hon. J. D. M. Dobie)- Order! The honourable member for Herbert will keep quiet.


-If the honourable member for Herbert would just contain himself for a moment I will prove that what I am saying is correct.

Mr Dean:

– But you can’t, because you abandoned the scheme.


-What I am about to say will prove that what I said before is absolutely correct, that is, that the Minister has replied to the Council of Local Government Associations in terms which are totally contrary to the evaluation by his Department of the benefits of the Regional Employment Development scheme.

Mr Dean:

– But you know that the RED scheme is useless.


-Order! The honourable member for Herbert will remain silent.


– Let me just go on to prove the point, despite the interjections and the attempts by the honourable member for Herbert (Mr Dean) to prevent me from so doing. In a doctor of philosophy thesis produced by Mr Andrew Burbidge of Melbourne entitled ‘Income Support Policies for Working People in Poverty’ there is mention of the evaluation conducted by the Department of Labour in 1976. It was conducted by the Manpower Evaluation and Review Branch of that Department. It is entitled ‘Evaluation of the Regional Employment Development Scheme’ and is dated August 1976. Mr Burbidge, in his thesis, says:

An evaluation of the 1974-75 job creation scheme found substantial benefits accrued to individuals, and, in the longer term, society, through the provision of work opportunities.

He then goes on to quote the Department of Labour’s evaluation of this program- an evaluation undertaken when the present Government was in office. He continues:

Other benefits which were mentioned by nearly all (CES office) managers were that the RED Scheme enabled persons to become involved in worthwhile community projects which generated quite a considerable amount of pride in the work done. This in turn led to a remotivation to work which had been badly affected by prolonged bouts of unemployment. This remotivation to work was illustrated by the fact that once the RED project had been completed the employee found his own work without having to re-contact the CES. In other cases persons who had unfavourable work histories changed completely and became steady reliable workers. Quite often sponsors spoke highly of the RED employees, enabling them to find secure employment subsequently.

That is the end of the direct quote from the evaluation. Mr Burbidge goes on to mention two other aspects of the RED scheme which were discussed in the evaluation. I continue to quote from his thesis. He says:

Another advantage of government-founded job-creation projects is that they can enable socially valuable projects to be carried out. Because such projects are assessed against social needs, rather than profitability, they can improve the facilities and services available to the community in general and to groups who would not be able to pay for the services provided. The evaluation-

That is, the evaluation of the Department of Labour- noted that ‘make work’ projects were expressly excluded from REDS funding by the guidelines, but no clear rules were laid down. The stipulation that projects should be socially useful was found to create few problems in interpretation. The projects which might come nearest to being accused of a make work character- pest and weed eradication, curbing, guttering, and road and footpath construction- made up only 14 per cent of the REDS projects evaluated.

He continues:

A second finding from the detailed study of REDS is that expenditure per job created is not high. The evaluation report shows that $32,730,924 was allocated to the 1,400 projects in the evaluation sample for wages and materials. 168,977 weeks of employment were created at a gross cost (before savings in unemployment benefit, etc. are taken into account) of $193.70 per person per week. By comparison, AWE in the year 1 974-75 -

This was the year of the evaluation- was $148.30.

Those are quotes from a study of the evaluation in a thesis which is writing up and commenting on the evaluation of the RED scheme undertaken by the Department of Labour’s Manpower Evaluation and Review Branch in 1976. Quite clearly, that evaluation brings up utterly different findings from those produced by the Minister. The Minister misled the Parliament in the comments that he made today. He is misleading the people of Australia and the Council of Local Government Associations in his repeated statements that the Regional Employment Development scheme and job creation programs in general are no good. I draw the attention of the House again to the fact that the evaluation of the Department of Labour shows that job creation programs have substantial benefits in many respects. Firstly, they accrue benefits to individuals through the remotivation to work and the ability to find work without Commonwealth Employment Service assistance, in better performance by employees after they have had experience of work under the RED scheme, and in favourable response by sponsors assisting them in finding other employment. Substantial benefits-

Mr Baillieu:

– Who wrote the thesis?


-I have already told the honourable member. If the honourable member bothered to listen instead of interjecting he would find out. He is so half-witted that he just cannot concentrate.

Mr DEPUTY SPEAKER (Hon. J. D. M. Dobie)- Order! The House will come to order. Interjections do not help with the proper running of the House. I remind the honourable member for La Trobe that he is not helping the conduct of the House.


– If the honourable member for La Trobe (Mr Baillieu) was twice as intelligent he would be a half-wit. As I was saying -


-Order! That does not help the conduct of the House, either.


– Then I say that he would not be a half-wit. Other benefits shown by the evaluation are that substantial benefits accrue to sponsoring organisations through the improvement of services and facilities and through socially useful projects and that expenditure per job is not high. The cost per job is only 30 per cent above average weekly earnings and that compares remarkably favourably with some of the costs per job created by the resource development projects which are so favoured by Ministers and others as a solution to the employment problems in this country. That evaluation throws an entirely different light upon the veracity of the comments of the Minister for Employment and Youth Affairs and others about the RED scheme and, indeed, upon the general impression that people might have about the value of job creation programs. Obviously, enormous benefits can come from those programs and they should be introduced. They will be introduced by the next Labor government. The Opposition outlined last Sunday a detailed program for job creation. When the Opposition is in government, those programs will be implemented and will prove to be of enormous benefit to the Australian people, particularly the unemployed.

Under the Fraser Government, concern for the services provided by local government has plummeted. The increase in the untied grant is a subterfuge to conceal a failure to provide adequate resources. Little ministerial consideration has been given to local government. It is not surprising that a government with the dictatorial style of the present Government should be lacking in sensitivity to the needs of local communities. Whilst supporting this Bill, the Labor Party sadly acknowledges that the resources it provides are totally inadequate to the tasks which local communities are asking local government organisations to fulfil.


-Order! Before I call the honourable member for Sturt, I remind honourable members on my right that the debate is not helped one tittle by their interjections. I ask the House to remain quiet while the next speaker is- and subsequent speakers are- heard in this debate.


– I rise to support the Local Government (Personal Income Tax Sharing) Amendment Bill. Before proceeding in detail with the remarks that I want to bring to the attention of the House, I want to comment on the argument of the honourable member for Gellibrand (Mr Willis). He spent a large proportion of the time allocated to him in this debate talking about the Regional Employment Development Scheme. It is necessary to remind members of the House that it was a scheme introduced by the Labor Government, that it was a scheme that provided most of the funds to local government- in fact, throughout its existence it provided some $ 1 84m- and that it was a scheme that was abandoned by the Labor Government. It was abandoned by the man who now is the Leader of the Opposition (Mr Hayden), when he was Treasurer. It was abandoned by him in his last Budget. No statement was made and no commitment was given that the scheme would be re-introduced. Therefore, if the Australian Labor Party has now had a change of heart about that scheme it seems very strange that it should be the one who abandoned it. If the Opposition now expects local government to rely upon vague promises about the re-introduction of such a scheme, what long term guarantee has local government got that under a Labor Government such a scheme would provide local government with continuing reliable sources of funds?

Mr Dean:

– None at all.


– None at all, as my friend says. The Opposition might introduce it for a year and then abandon it the next year. When we looked at the whole question of funding local government, we gave local government a commitment that we would give to local government a share of income tax. We have honoured that commitment. Prior to the 1975 election, the LiberalNational Country parties promoted their federalism policy. Included in that policy was a vital element that affected local government. It was a commitment to recognise local government as one of three spheres of government. It was a commitment to give to local government a share of income tax. That commitment was honoured. A subsequent commitment to raise that share of local government to 2 per cent of income tax collections is being honoured within the time of the commitment by the Local Government (Personal Income Tax Sharing) Amendment Bill which is now before the House. It has given to local governments a broader revenue base. It has given them a reliable revenue base in terms of the share local governments now have of income tax.

If the honourable member for Gellibrand is concerned about local government’s capacity to employ people, let us look at what the revenue sharing of income tax has done for local government this year and what it will do for local government next year. This year local government received $22 lm, an increase of 23 per cent on the previous year. That increase was substantially in excess of the inflation rate for that period and gave to local government a capacity to use the additional revenue on employment-creating work. Likewise, for the year 1980-81, as a result of the Bill now before the House, local government will receive an estimated $303m, an increase of 36 per cent. If local government is concerned- as we all are concerned- to ensure that adequate employment opportunities are created, local government, through its share of income tax, is being given an opportunity to demonstrate that it can, with the moneys being provided to it, create more jobs for people in need of employment.

I would urge upon local government, a sphere of government which has a great capacity to provide employment opportunities, to give serious consideration to creating as many jobs as possible. In doing so, it should look at the potential of providing for part time work where that is possible. I know a response might be to say: ‘Well, people want full time work’. What has to be done in circumstances as exist at the present time is to ask the question whether 100 people should be given full time work or whether the opportunity should be taken to give, say, 200 people half time work, or 150 people two-thirds time work- whatever the appropriate ratio is. Here, as a result of the increased revenue being provided to local government authorities, they will have an opportunity to confront that question and ask themselves how they can best help provide employment for the residents of their own communities.

One of the significant features about the revenue sharing arrangements under the Fraser Government’s federalism policy is that it provides to local government untied grants- grants that local government can use at its pleasure for a range of alternatives. It can, in certain circumstances, use it for what might be described as rate relief, although I hold the view that local government has a responsibility to maintain its rating effort. If local government wants to embark upon new ventures then it is proper that it should use its revenue share from the income tax collections. I believe that except in special circumstances it is proper for local government to effectively use its revenue collection base through rates. As a result of the increased share of income tax, it is able to embark on new ventures. It is able to advance its work programs ahead of the time schedules that would otherwise be possible without the income tax share, or it is able to broaden the range of the activities that it performs for its own citizens.

The revenue that is paid to local government under the income tax sharing arrangement is required under the legislation to be distributed as to 30 per cent of the total amount for a State on a population basis which may under certain circumstances take into account the size, population, densities and other agreed matters. It is interesting to note that in a number of the States local governments have distributed this minimum 30 per cent share and in some States even a higher proportion- Western Australia providing the highest on the per capita distribution but taking into account a number of other factors. The remainder of the amount is to be distributed through local government grants commissions established in each of the States, in accordance with the terms of legislation passed in this Parliament. The amounts are distributed on a general equalisation basis, as far as practicable, to ensure that local government authorities are able to function by reasonable effort at a standard not appreciably below the standards of other local government authorities in the State, taking into account the differences in the capacities of local government to raise revenue and differences in the costs of performing local government functions.

In the time available to me, I want to draw to the attention of the House the importance of the appropriate distribution, firstly, of the local government share as between the States and, secondly, I want to talk for a time on the manner in which any State share is distributed between the local government bodies within a particular State. The Minister for Administrative Services (Mr John McLeay), asked the Commonwealth Grants Commission to investigate and report upon the manner in which the local government share of income tax should be distributed. The Commonwealth Grants Commission has examined this matter on three occasions. On the first occasion it made recommendations as to proportions in which the local government’s share of income tax should be divided amongst them. On the second occasion it varied the original recommendations arising from an application by the Tasmanian Government asking that matters not taken into account in the first recommendation be examined with a view to making a variation. Such a variation was made.

The third investigation conducted by the Commonwealth Grants Commission was at the request of the Minister. The Commission was asked to report on the matter of principles to be observed and the procedures to be followed by the Commonwealth Grants Commission in future inquiries and reports on the revision of percentages contained in section 5 (2) of the Local Government (Personal Income Tax Sharing) Act 1976.

Debate interrupted.

page 1169


Mr DEPUTY SPEAKER (Mr Millar)Order! It being 10.30 p.m., I propose the question:

That the House do now adjourn.

Question resolved in the negative.

page 1169


Second Reading

Debate resumed.


– I was referring to the request given by the Minister for Administrative Services to the Commonwealth Grants Commission to investigate the principles to be observed in future allocations of local government’s share of income tax from money allocated to the States. The Commonwealth Grants Commission has reported its findings. Those findings are very interesting. As yet the Premiers have not reached any conclusion on the recommendations that were contained in the report of the Commonwealth Grants Commission. What is noteworthy is that the Commonwealth Grants Commission has drawn to the attention of the public and the Premiers the fact that there are: . . . wide differences between the distribution of the local government assistance and the interstate distribution of the tax sharing entitlements of the States.

As an aside, I might say that there is also a very wide difference between the distribution of the general revenue to each of the States and the distribution of the specific purpose grants to each of the States. I believe it is a matter of some concern that if we are to achieve a sensitive, proper and effective distribution of income tax to the States, that in its examination of the matter now before it, the Commonwealth Grants Commission should take into account the distribution of the specific purpose grants.

The Grants Commission reached the conclusion that the manner in which the share for local government should be distributed between the States was a matter of policy for governments to determine. It placed before the Premiers Conference a series of options, the first of which it placed highest and in effect recommended. That option was that the money available for local government should be distributed in proportion to the respective unweighted populations of the States. The Commission went on to explain that a distribution upon the basis of a State’s population has an equalising effect. As it pointed out, the relationship between the size of the population within a local government area and its needs for expenditure is important. I hope that it will not be long before the Commonwealth and the States face the questions raised by the Commonwealth Grants Commission and make a decision as to the manner in which the pool of income tax allocated for local government should be distributed between the States.

I wish now to turn to what is in many ways a related matter. I refer to the distribution within a State of the share of income tax that is allocated for local government in that State. I referred a few minutes ago to what has been described in some reports as the ‘as of right distribution’; that is, the minimum 30 per cent distribution on a population basis to each local government body within a particular State. I wish now to raise a matter of real concern about the methodology being adopted by the Local Government Grants Commissions within the States. The Grants Commissions of Victoria and South Australia have demonstrated a sophisticated, concerned approach to this whole matter. They have taken seriously the charge given them under the Commonwealth legislation that they should distribute the balance available, other than that allocated on a per capita basis, in accordance with the principles of equalisation. The Victoria Grants Commission annual report for 1979 reads:

In its 1978 Report the Commission proposed changing the basis for deriving standard costs from net costs to gross costs, discounting the gross disability assessment so assessed for a function by the proportion that expenditure on that function by a municipality from its own resources bears to its total expenditure on that function from all sources. The approach is predicated on the basis that government programs of assistance have the general aim of setting standards of service and the incidence of such assistance is restricted by the availability of funds. Therefore it is reasonable to include expenditure from all sources when determining standard levels of expenditure; hence this approach is commonly referred to as the inclusion method. The discounting of the gross allowances described above ensures that needs and disability allowances are related to ratepayers’ contributions to expenditures and avoids double-counting in relation to government grants for particular services. This approach was adopted for all functions in determining the 1 979-80 allocations.

That rather complex formula was more adequately described in the report on the role, structure and administration of local government in Victoria. I would like to have quoted paragraphs 15.38, 15.39 and 15.40 but time does not permit. Paragraph 15.40 provides: . . . the Board recommends that, in principle, government assistance to municipalities should be embraced within an untied general grant to be introduced at an appropriate time; such a grant would replace the tied grants received from the several State departments and be based upon criteria reflecting the needs and resources of individual authorities.

The earlier paragraphs deal with the concept of whether or not the grants distributed on an equalising basis should take into account or ignore the distribution made for specific purposes. That principle was more adequately described in the report of the South Australian Local Government Grants Commission. Again I have time to quote only a portion of the report. It reads:

Bearing this in mind, the use of the approach outlined above ensures that the benefits accruing to the recipient councils of specific purpose grants are reflected in the standard cost used for equalisation purposes. This approach means that the distribution pattern which emerges from the Commission’s use of equalisation principles when allocating tax sharing grants in effect overrides the distribution pattern of funds that would result from the allocations made under the specific purpose programs. The ‘overriding’ approach assists councils which are unable to participate in specific purpose programs.

My final comment is that if local government grants commissions are adopting that overriding approach it is time that the amount of money needed to provide effectively for rural and urban local roads be provided as an untied general revenue grant to be distributed by local government grants commissions in a manner which takes into account all the needs including the road needs in accordance with equalisation principles and the needs of those local government bodies, for to do otherwise would be to delay the distribution of local government grants under the legislation we are considering tonight. The legislation contains a provision that enables early payment provided the local government grants commissions have made their recommendations. They will not make those recommendations unless they know the road allocations.

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


-As indicated by the honourable member for Gellibrand (Mr Willis), the Opposition is not opposing the Local Government (Personal Income Tax Sharing) Amendment Bill.

Mr Neil:

– Sit down.


– If I sit down I will at least be a little taller than the honourable gentleman is when he stands up. One thing that we on this side of the House are pleased about is that finally we are able to speak on a piece of legislation in which the Prime Minister (Mr Malcolm Fraser) honours an undertaking given in his 1977 election speech. One of the reasons that so many honourable members are interested in this area is that when the Whitlam Government instituted direct financial grants from revenue to local government -

Mr Dean:

– Inequitably.


– The honourable member interjects ‘inadequately’.

Mr Dean:

– I said ‘inequitably’.


-I will let that pass then. At least it was an acceptance of the role of local government in the community. I think it is a role which, because it operates at grass roots level and because of the stimulus it has given to some community involvement, most honourable members realise has been well worth while. It is a field in which, being so new, there is is obviously considerable development still to take place. In the second reading speech there is a comment about the great increases in the absolute amounts of untied funds going to local government. There should also have been comment that, of course, tied grants for local government have declined out of sight. One of the problems with the new federalism of this Government is that whilst we can give 2 per cent of the income tax revenue in an untied way for local government purposes, this is valid only as long as increasing responsibilities are not placed on local government. I do not believe that is the case. I do not believe that this Federal Parliament can afford to say, ‘ We are meeting our commitment of the 2 per cent of revenue’, without considering what is going on at the local government level.

The honourable member for Sturt (Mr Wilson) commented on the method of distribution amongst the States. He said that the method of distribution is laid down in the principal Act and that in fact the Commonwealth Grants Commission, in its special report of 1979, had laid down five options for the way the money could be distributed. It is also true that the Commonwealth Grants Commission recommended adoption of option A which is:

Distribute in proportion to the respective unweighted populations of the States.

The Victorian Grants Commission points out that if the Commonwealth Government adopted this recommendation Victoria’s share would rise from 25.45 per cent to a population share of about 27.5 per cent. The Victoria Grants Commission also commented:

At the time of writing this Report, the Commonwealth Government has not announced what action it will take in respect of the recommendations.

Of course it is important to the States to know the basis for distribution of that revenue. I am sure that my colleague the honourable member for Lalor (Mr Barry Jones) is very conscious of that because of the added and quite considerable responsibilities of municipalities in his area.

Mr Barry Jones:

– Unelected.


– The honourable member has just reminded me about one of his municipalities.

Mr Barry Jones:

– Two.


-Goodness me! They need some Federal intervention. I come briefly to the attitudes of municipalities to this grant. I passed on to municipalities in my electorate copies of the second reading speech of the Treasurer (Mr Howard) and of the legislation. I suppose that the following response from the Shire of Whittlesea Council is pretty characteristic

On receipt of that information, Council directed me to advise you that whilst Council is pleased to receive notification of an increase in Federal Funding to Local Government, it does not believe that the increase is adequate considering the changes in the sphere of Local Government responsibilities.

A request was then made for me to press for the adoption of a different attitude. I know that that Council, which receives tied grants, is responsible for a municipality covering a very large rural area and a burgeoning residential area in the south. For example, there is a need for an elderly citizens club, but there is no possibility of the Council receiving a grant for that purpose for some years. So the Council has to commit capital to that project and has to hope that it will receive a grant in the future.

The Preston municipality reports, for example, that for the Preston library the government subsidy in 1 975-76 was 64 per cent and in 1 978-79 it was only 52 per cent. In absolute amounts, we are talking about library expenditure of $359,686 in 1976-77, going up in 1978-79 to $506,198. So the expenditure has risen by $146,512 and the subsidy has risen by only $31,450. This is a service which all levels of government would want to see promoted. The State Government, when approached, stated that, because of the untied grants subsidy, rises in the subsidy which could be passed on for that purpose were not necessary. If we use that same municipality as an example and consider its health and welfare services for 1977-78 and 1978-79 and the estimate for 1979-80, we get a concept of the considerable amount of social welfare services that municipality deals with, including day nurseries, senior citizens clubs, home help, kindergartens, child minding centres and so on. I have a table of those services about which I have spoken to the Minister for Home Affairs (Mr Ellicott). I seek leave to have that table incorporated in Hansard.

Leave granted.

The table read as follows-


-I thank the House. Because of the lateness of the hour, I do not want to have to go into the details of that table, except to say that it is interesting to note that in 1977-78 the total costs of these welfare services was $978,709, of which the Council contribution was $393,376, or 40 per cent. Yet, in the following year, when the total cost had risen to $1,222,242, the Council contribution had risen to $551,827, or 45 per cent. In just this one area of local government responsibility there had been a 5 per cent increase in 12 months. I do not see that we can afford to look at this finance for local government in isolation, without realising that the Federal Government and the State governments are pushing far greater responsibilities on to local governments, as well they might. That is the proper level of government to supply a lot of these types of services. It is appropriate that the grass roots local government should handle these services. But there is no way that the rating system can be used in an equitable way to make up the shortfall in these services. The responsibility is not one that can be financed in that way.

When dealing with small units like local government, the Federal Government has to be very careful. For example, let us consider the effect of the rise in interest rates this year. Before 17 January this year the position was that the maximum rate for a public loan of a four-year to nine-year term was 10.2 per cent. On 17 January it was advised that maximum rates for public loans for four to nine years would be 10.8 per cent and for loans over 10 years, 10.9 per cent. For private loans of four to nine years the rate would be 1 1. 1 per cent and for 10 years and over, 1 1.2 per cent. But then again, on 3 March it was advised that the rate for public loans for four to nine years would be 11.6 per cent and for 10 years and over 11.7 per cent. The comparable figures for private loans were 1 1.9 per cent and 12 per cent respectively. This meant an increase from 10.2 per cent to 11.6 per cent, or 1.4 per cent, in a matter of less than three months. So one can appreciate the heavy interest burden such increases place on a small municipality with a borrowing capacity of $ 1.2m before it has to go to the Loan Council. That is another factor that has to be taken into account when considering the level of finance from taxation revenue that should go to local government.

Other areas should also be considered. The honourable member for Gellibrand concentrated on the work schemes. One must also admit that there is increasing pressure at local government level for the provision of recreational services, but there is greater pressure for the provision of environmental services. One could well include garbage and waste collection in that area. There is the problem of roads. There is also the specific problem whereby a community puts all its responsibilities onto one municipality. That has happened in Melbourne in regard to hazardous wastes. The city of Broadmeadows is now lumbered with a dump for the disposal of hazardous wastes. This causes a lot of concern to residents in the surrounding area. I must admit to some interest here because I live to windward of the area and when the dump really gets going I am afraid I will be on the receiving end. I think it is unfair that these sorts of responsibilities are imposed on municipalities, whether it be by State governments, as it is in this case, or by Federal governments in regard to some of the social security measures.

Because of the lateness of the hour, I will conclude my remarks on that point, but we welcome the increase to 2 per cent in local government personal income tax sharing. I hope that the increase will not lead to a complacency whereby it is said: ‘Because we give this amount in untied grants we are going to ignore completely the additional responsibilities that have been placed at the grass roots level of government without having due regard to their needs and to the assistance that should be given’.


– It is with pleasure that I associate myself with the Local Government (Personal Income Tax Sharing) Amendment Bill which is before the House tonight. For a period of some 35 years I was closely associated with local government in New South Wales, as an employee and later as an alderman and a mayor. I believe that this past service in public office places me in an ideal position to recollect the difficulties that occurred when local government bodies endeavoured to raise the necessary revenue from the ratepayers so that they could adequately provide the necessary services and in many instances additional services to which the ratepayers and residents were justly entitled.

Mr Uren:

– Who introduced the breakthrough?


– Just wait and listen. I recall very well the persistent local government approaches to government for a share of income tax and the deputation I lead as chairman of the New South Wales Country Mayors Association in 1972. I remember as a delegate the 1972 annual conference of the Local Government Association of New South Wales. It was held in Canberra for one express purpose and that was to place pressure on both the Government of the day and the Opposition to promise yearly untied grants to local government. To the credit of both the Government and the Opposition of the day assurances were given that local government would be assisted. The Canberra conference was the breakthrough that was needed. We all know that the Whitlam Government commenced the allocation of some funds in the 1974-75 financial year. The allocation of funds to local government, I believe, would have happened irrespective of who had been elected in 1972. Local government had made its point and had won the day. Since the election of this Government in 1975 a different atmosphere has surrounded local government. This change has been brought about by an election promise, a promise of which I am pleased to be part as the honourable member for Macquarie. This Government recognised the responsibilities and needs of local government, the government which is closest to the people. The Government is therefore committed to provide to local government throughout Australia a direct share of personal tax collections.

The tax formula which now forms the basis of local government funding first became effective in the financial year 1976-77. It then provided in total $ 1 40m to be distributed. This constituted an increase of $60m or about 75 per cent in the funds provided by the previous Labor Government in the preceding financial year. This Government did not stop with just recognition. In the first year of increased financial support it promised to increase the base percentage of personal tax collections from 1 .52 per cent to 2 per cent during the life of this Parliament. Today is the completion of that promise. When one analyses data from federal Budgets during recent years there emerges a most generous trend. During the last four years, the life of the current

Liberal-National Country Party Government, federal funding to local government has increased from $80m to a massive $220m estimated for the current financial year. The passing of this legislation will ensure an increase of $3Om for the 1980-81 financial year.

I know well that the Blue Mountains City Council and Penrith City Council, whose shires form the bulk of my electorate, appreciate our past recognition of their efforts and responsibilities. They will be further delighted by this decision today. It ensures that they, along with all other municipalities and shires throughout Australia, will be able to continue to improve and expand their services to local communities. At the same time, they should be able to keep rate increases well below the inflation rate. I refer briefly to the grants which have been received in the electorate of Macquarie and to what occurred under the previous Government. In 1975-76, under the previous Labor Government, Penrith City Council received $450,000 and the Blue Mountains City Council received $310,000 from a total grant of $80m. It should be recalled, however, that under the guidelines of the previous Government not all local government authorities received a grant. In fact, Oberon Shire Council, whose area was then part of the electorate of Macquarie, did not receive one cent. It received nothing under the previous Government. In 1973 the then Prime Minister, Mr Whitlam, in his second reading speech on the Grants Commission Bill 1 973, said: . . . the financial assistance to local governing bodies which will flow From the Commission’s recommendations will in no way be a substitute for the revenues normally raised by them by long established methods such as rates and charges for services, nor will it replace assistance normally provided by State governments to local governing bodies in one way or another. Rather, it will be in the nature of a ‘topping-up’ process of the financial resources of lesser endowed bodies to enable them, by reasonable revenue raising efforts on their part, to provide a standard of services to their communities that will be comparable with that enjoyed by communities elsewhere.

In its first report on financial assistance to local government in 1974, the Commission recommended grants for 1974-75 totalling $56,345,000. That sum went to 806 local government bodies and represented 92 per cent of the 876 which applied for assistance. I repeat, the Oberon Shire Council, which was then a part of the electorate of Macquarie, received nothing.

In its second report in 1975-76, the Commission recommended grants totalling $79,908,000 for 845 local government bodies. These represented more than 95 per cent of the 885 which had applied for assistance. Still, at that stage, not every local government body in

Australia received assistance. It should be remembered that, as has been previously stated, not all local government authorities received grants under the former Labor Government. In 1974- 75, 92 per cent received grants and in 1 975- 76 the proportion was 95 percent.

Today the topping up process does not apply. All local government authorities share in this special allocation of funds. This Government’s allocation in its first year of office was $140m. This year it totals $222m and, with the additional allocation which represents 2 per cent of income tax revenue, it will rise to $250m in 1980-81. Penrith City Council, which was allocated $800,000 in 1976-77 has received $1,305,000 during this financial year and next year it will receive $1.5m thanks to the Fraser Government. Similarly, the Blue Mountains City Council received $500,000 in 1976-77 and will receive $lm in 1980-81. That is double the amount it received in 1976-77. The grants to both councils must have a stabilising effect on their rate structure.

I wish to refer specifically to the manner in which some councils in New South Wales are spending this untied grant money. There are instances in which it could be used to ease the rate burden but in many cases it is being used to provide services that I believe are not within the ambit of local government. Rather they are within the ambit of the New South Wales Government. Because some councils have gone outside the traditional role of providing public services such as roads, drains, playing fields, libraries, water and sanitation, other councils viewing this from a distance have decided to become part of the act. Today social workers, community workers, youth workers and welfare officers are being employed by local government in increasing numbers. Some bodies have even decided to employ fire officers. As at 1 March 1979, 27 councils in New South Wales employed community workers, 30 employed youth workers and 28 employed welfare officers for the aged. One council employs all of these and has a welfare staff of 27. The officer-in-charge of that staff enjoys a status which is similar to that of a city engineer.

Mr O’Keefe:

– Which council is that?


– I refer to Marrickville Council, in Sydney. I point out these facts because of the desire of local government for a still greater share of income tax revenue. Councils that are entering so extensively into the social welfare field should think about it for a while because I believe they are entering a field which is the responsibility of their State government. I support with pleasure the Bill that is before the House.


– I wish to reply briefly to the remarks of the honourable member for Macquarie (Mr Gillard), who admitted somewhat grudgingly that the Whitlam Labor Government introduced tax sharing arrangements for local government authorities. It is a fact of life that for many years local government authorities had been seeking federal aid. Our Government undertook an inquiry and made its first commitment in that regard in 1974-75.That commitment was increased by 40 per cent in Labor’s last year in office to $79.9m. Frankly, the honourable member for Macquarie should also know that Labor introduced many other broad programs which assisted local government. One of the programs which helped particularly in the Macquarie area was the national sewerage program. That program has been completely abolished by the present Government. I will reveal figures to show that this Government has cut funds for local government by 20 per cent in real terms since Labor’s last year in office. I make it clear that the Labor Party is committed to sharing with local government at least 2 per cent of federal personal income tax raised. As I said earlier, the Labor Party first introduced grants to local government without any strings attached. To that extent, the Opposition is not opposed to this Bill, as far as it goes.

However, the Bill does not go far enough. The Labor Party regards local government as potentially the most active level of government where people can participate in the process of improving their living environment and of exercising some control over the decisions that affect them in their daily lives. The Opposition does not believe that any one level of government can resolve the many problems facing Australians. The three levels of government have to work together in co-operation as equal partners to improve living standards. I was the Minister responsible for local government between 1972 and 1975. The whole role of the Labor Government was to seek to work in a co-operative way in urban and local government affairs. The only way those problems could be solved was to have the Australian, State and local governments working together. We had to break down the differences that existed and start to build a respect and understanding between the public servants, or what I call the bureaucracies. Until the differences between the bureaucracies can be broken down so that there can be planning and an accepted interrelationship, there will never be true government in this country.

This Government’s approach to local government is narrow and aloof. It does not regard local government as a real partner in the co-operative system. It treats local government as an appendage and has reduced the relationship to a mere flow of money. I wish to make it clear that this

Government has not increased- rather it has reduced- the total real funds available to local government. To give some proof of this I seek leave to incorporate in Hansard a table showing Federal funding for local government between 1975-76- the last year of a Federal Labor government- and 1979-80.

Leave granted.

The table read as follows-


-I thank the House. The table shows that the total Commonwealth payments to the States for local government at 1979-80 prices fell from $476.6m in 1975-76 to $382.7m in 1979-80-a cutback of 20 per cent. In 1975-76 payments to the States for local government made up 4.5 per cent of total individual income tax revenue collected by the Federal Government in the previous year, but in 1979-80 they made up only 2.9 per cent. Even if the payments for roads and the Regional Employment Development scheme- which the Treasurer (Mr Howard) has criticised- are excluded, the proportion of payments for local government under the same period fell from 2.2 per cent to 1.9 per cent. The reductions were made in direct and other payments to local government, which were cut from$188.3 in 1975-76 to $27min 1979-80.1 seek leave to incorporate in Hansard a table which is drawn from Budget Paper No. 7 for 1979-80.

Leave granted. *The table read as follows-* {: .speaker-EE4} ##### Mr UREN: -I thank the House. That table $188m in 1975-76 to $27m in 1979-80. These clearly reveals that the Government has failed specific purpose programs allowed for the the community. The figures in that table prove sharing of ideas, experimentation with programs that specific purpose payments have been with- and the on-going contact between people indrawn or cut drastically from an amount ofvolved in the three levels of government. They were directed to the specific needs of the people. In the second reading speech the Treasurer said that the RED Scheme and employment grants passed on to local government authorities by the States 'were merely used as a channel for disbursement of funds to assist employment'. This Government is very reluctant to assist employment. But the Treasurer shows no understanding of how the RED Scheme worked- the important socially useful work that was done in local areas, the networks that were created in local areas and the employment that was generated. I point out that in Labor's new proposal which was put forward on Sunday by the Leader of the Opposition **(Mr Hayden),** we do not intend to follow fully the former RED Scheme. In relation to the programs of the RED Scheme, I want to make this point clearly: I was one of the RED Ministers, if I may use that term. I have always been 'red' in my politics. I always try to adopt a humane approach. Let me place on the record that the RED Scheme was not abolished by a Federal Labor Government. Funds were made available. In a submission to the Cabinet, the responsible Minister of the day, **Senator James** McClelland as he then was, put forward a proposal to clean up the RED Scheme at a cost of $ 124m. The Cabinet decided to provide $135m. The reason for the difference of $1 lm in the allocation was so that the program could continue at least until 1 January 1976. If the employment position did not improve as a result of budgetary action it was planned to stimulate the economy by creating further employment opportunities through the RED Scheme. What happened was that the bureaucracy of the Department of Labour at that time said after the Budget figures had been determined that an error had been made in its figures and it was not able to meet the commitment. The Department of Labour was inefficient in its costing. However, the Budget commitment had been made. I want to make it quite clear now that at no time- I emphasise 'at no time'- did a Federal Labor Cabinet finalise the RED Scheme. I make that point clear as a Cabinet Minister of the day. Let me illustrate some achievements under the RED program. I come from the western suburbs of Sydney. Under the RED program some very socially useful projects were completed. I invite honourable members to look at some of the projects. They included a botanical garden at West Auburn, the central gardens at Merrylands, the improvements carried out along Duck River, a tributary of the Parramatta River, and the improvements carried out in many urban parks. **Mr Deputy Speaker,** you come from Western Australia. Some of the finest works programs have been carried out in the suburbs of Perth in the Belmont Shire because of the initiative of local government. It has been very fine work. I am not saying that errors were not made; they were made. But governments have to learn from the mistakes that have been made. We have to make sure that members of this Parliament start to have some compassion about creating employment. Certainly the RED Scheme performed a very useful social function. It created a great deal of good and a great deal of employment. The priority of allowing local government the real opportunity to promote ongoing employment and to improve local areas is an important priority which a Labor government will be committed to when it is elected at the end of this year as it was committed in the past. Let us consider some of the special purpose programs that have been curtailed by this Government and its blanket approach to local government funding. For instance, money flowing to aged or disabled persons homes, handicapped persons assistance, child care facilities, homeless persons assistance, senior citizens centres, employment grants, growth centre funding, area improvement programs within local government areas, the National Estate, the national sewerage program, urban public transport and regional development assistance has been either curtailed drastically or, in most cases, completely abolished. All of these programs were aimed at improving the living standards and lives of people. The ability of local government bodies to meet these needs out of general revenue grants is being reduced also by the increase in interest rates. Local government bodies will find it increasingly difficult to raise sufficient funds for essential community services because of the increase in interest rates that will occur. Recently the Loan Council approved an increase of 0.8 per cent in semi-government borrowings. In November 1977 the Prime Minister **(Mr Malcolm Fraser)** made an election commitment that the Government would reduce interest rates by 2 per cent by the end of the year. But the interest rate for securities of terms of less than 10 years has increased from 10 per cent at that time to 11.6 per cent in March 1980. Over the same period interest rates for long term securities have risen from 10.3 per cent to 1 1.7 per cent. Those authorities involved in the provision of publicly subsidised infrastructure- electricity, ports, roads- for private corporations will get preferential treatment in capital in finance markets. On the question of raising moneys, local government authorities now have to pay 1 1.7 per cent interest to borrow money in order to carry out these programs. The private sector may get 12 per cent debentures. Companies service the interest debt on debentures before the 42.5 per cent company tax is charged. Therefore 12 per cent debentures cost these corporations less than 7 per cent interest. So the private sector is developing works paying only 7 per cent interest on the money borrowed while local government authorities have to pay up to 11.7 per cent. Again, this is one of the unfair burdens that this Government has imposed. Local government bodies will be increasingly forced to redistribute the cost of providing community services on to the individual through the various techniques known generally as the user pays system. Such a redistribution will be inequitable. Those regions most in need of improved services will least be able to afford them. If Federal Government funding is allocated to local government on an unweighted per capita basis, as the Grants Commission has proposed, the inequities will be even greater. This Government gives priority to those programs which provide public subsidies to private corporations for the development of industrial infrastructure. The Government is guilty of neglecting the needs of people. For example, recently I visited the Queensland city of Gladstone where there is large-scale corporate investment in alumina refining and aluminium smelting. A lot of public money is being used in Gladstone to provide transport facilities for companies, upgrading the rail systems, expansion of port facilities, improvement of roads to allow heavy traffic and provision of excessively cheap electricity at around 0.5 cents per kilowatt hour to Comalco when the normal average Australian citizen pays something like 3c per kilowatt hour, or in other words, a cost something like six times greater than that paid by Comalco. However, the schools are overcrowded, there is a critical housing shortage, there is only one welfare officer operating on a shoestring budget, health facilities are inadequate and there are few recreational facilities. The social problems in Gladstone are increasing with the rapid expansion of industry, but those social problems are not being adequately addressed. There are many people of goodwill on the local council and in the community generally who would be willing to work to make Gladstone a more reasonable environment in which to live if they were given some encouragement and assistance. Those are just some of the things that affect local government. In conclusion, I point out that apart from the 2 per cent general revenue assistance to local government, a Labor government will introduce a broad program to assist local government. I seek leave of the House to incorporate in *Hansard* the local government policy set out at the Labor Party's conference in Adelaide. Leave granted. *The document read as follows-* >LOCAL GOVERNMENT > >Labor is committed to the recognition of local government- as a genuine recognised partner in the Australian Government system, with rights and responsibilities. > >In state constitutions, as autonomous, with its own bona ride electorate, and with its own revenue sharing responsibilities. Which ought not be suspended by another level of government without formal rules and proper enquiries, hearings and appeals. > >As a general (multi-) purpose personal level of government which ought to have a role which is not strictly limited, and given permission only to undertake a limited range of activities. It should be positively encouraged to include selected enterprises and use its initiative. > >And to its representation on the Council for InterGovernmental Relations. It should be actively involved in inter-governmental consultations and agreements, especially those affecting it financially. > >And will seek the support of local government for the inclusion of a local government representative on the Loan Council and for power of the Australian Government to borrow on its behalf. > >Labor recognises three fundamentals about our Federal System of government, namely that- 1 Within a three-level government system there is a need to balance the functions and finances of each level to ensure the adequate development of services and natural and human resources. 2 Between the three levels there ought to be consultation, co-operation and joint evaluation of public programmes. 3 The three levels of government need to be involved in setting priorities and broad targets for the standards and quality of community services and conditions that their combined efforts are aimed at producing. > > *Consensus on Local Government Responsibilities* 4 Labor believes that local government should have its authority and responsibilities more clearly defined recognising the need for diversity between States. A Labor Government will therefore promote and participate in a discussion and inquiry into the desirable range of functions, rating and revenue raising, principles of organisation and operation, and the principles of inter-government relations, for modern local government. This inquiry would be undertaken with states, local government and community organisations. > > *Revenue Sharing and Local Government 5* Labor is committed to sharing with local government at least 2 per cent of the federal personal income tax of the previous year. In the event of the real value of federal net personal income tax collections ever falling between the years, a Labor Government will maintain at least the real value level of the previous year, i.e., the provision of general (untied) revenue assistance to local councils by a proportion of the revenue raised by the national government. > >Principles of Division of the Revenue Sharing Grants 6 The major factors to be considered in reaching recommendations on revenue grant levels between all local government authorities will include the following- a a capitation grant comprising 30 per cent of all revenue sharing funds will be given to all councils; b a second part, a 'needs' or 'topping up' component will be added to the capitation grant based on the following criteria, which would comprise the other 70 per cent of revenue sharing grants- i assessment of disabilities in the revenue base or capacities of the area; ii assessment of expenditure, disabilities, such as the characteristics of the council area's demography, topography, geography and geology; and iii assessment of the relative needs of the area 's population and the level of services available to them (especially those provided by the Council). > > *The Australian Grants Commission* 7 Will be responsible for calling for applications for general revenue grants. It will report publicly on its advice to the Australian Government. > >S The Grants Commission panels examining Councils' needs in each State will include State and local government nominees. Provision will be made to receive public submissions. > > *Local Government and Special Purpose Grants* 9 In addition to its commitment to general revenue assistance by revenue sharing, Labor is committed to assisting local government by special purpose grants to be allocated on a needs basis. 10 These grants will absorb a number of existing special purpose grants, into a series of broadly based grants with greater discretion at the local level. 1 1 These special purpose grants will give priority to regional and community development activities, and programmes to alleviate the growing unemployment problem. 12 In addition, special assistance will be given to assist cooperative activities between local government bodies on a regional basis. {: .speaker-EE4} ##### Mr UREN: -I thank the House. I want to refer specifically to some of the headings under which the broad program is set out. Under the heading 'Consensus on Local Government Responsibilities ', and I wish to read this because an ongoing inquiry is so necessary due to the differences from State to State, it is stated: >Labor believes that local government should have its authority and responsibilities more clearly defined recognising the need for diversity between States. A Labor Government will therefore promote and participate in a discussion and inquiry into the desirable range of functions, rating and revenue raising, principles of organisation and operation, and the principles of inter-government relations, for modern local government. This inquiry would be undertaken with states, local government and community organisations. This would be an ongoing inquiry because it is extremely important to get a better understanding of local government. Only with that understanding will Federal, State and local governments be able to work together to make local government a more" functioning authority. This Government has failed to do that. It provides local government authorities with moneys without any real co-operation and without any real understanding of its programs. {: #subdebate-32-0-s4 .speaker-K5A} ##### Mr O'KEEFE:
Paterson -Like the honourable member for Macquarie **(Mr Gillard),** it has been my lot to be a member of local government for 36 years. During that time I have seen the great changes that have taken place in this form of government, going more or less from the horse and buggy days to the modern age of machinery and development. The Bill before the House is to amend the Local Government (Personal Income Tax Sharing) Act 1976 to increase the annual percentage of net personal income tax collections allocated to local government from 1.75 per cent to 2 per cent as from the 1980-81 financial year. Under the Liberal-National Country Party federalism policy which commenced in 1976-77, local government receives a fixed percentage share of the net personal income tax collections of the previous year. For 1976-77, 1977-78 and 1978-79 the percentage share of this personal income tax revenue was 1.52 per cent. The Local Government (Personal Income Tax Sharing) Amendment Act 1979 raised the share to 1.75 per cent for this period. This Bill provides for the percentage share to be raised by 2 per cent as from 1980-81. This fulfils an undertaking given by the Prime Minister **(Mr Malcolm Fraser)** in his November 1977 election policy speech that the local government share of income tax collections would be raised to 2 per cent. The tax sharing funds, like the general revenue grants for local government provided in 1974-75 and 1975-76 under the Australian Labor Party Government, are not subject to any conditions as to how they may be spent by local authorities. Untied funds for local government have increased substantially in recent years. It is entirely up to the local government body how these untied grants are allocated. Some councils in their wisdom enter into new projects. Other councils use the grants for assistance with rates. Also there are many other avenues to which local government allocates these funds. I mentioned that these funds have risen substantially in recent years. The allocations were $80m in 1975-76, $140m in 1976-77, $165m in 1977-78, $179m in 1978-79 and $222m in 1979-80. It is anticipated in this Bill that we are debating at present that the amount wil be approximately $303m in this financial year. The distribution among States of the total share of income tax collections earmarked for local government is set out in the principal Act. Distribution between local government authorities, of course, is decided by each State grants commission. I add that the State governments also allocate funds to their various local governments. {: .speaker-JUS} ##### Mr McVeigh: -- I do not think they give anywhere near enough. {: .speaker-K5A} ##### Mr O'KEEFE: -- I am just coming to that matter. The funds they allocate are nothing compared with the Federal Government grants. Personal income tax under this legislation is to be increased from 1.75 per cent to 2 per cent and it is to apply as from the 1980-81 financial year. Local governments in the past 15 years have assumed greater responsibility at the request of the ratepayers. We find that today ratepayers expect swimming pools, baby health centres, sporting ovals, assistance for handicapped children, pensioner centres, libraries, social workers, community halls, kindergartens and so on. Local governments are also expected to and do carry out decentralisation of industries in their areas. Here they are assisted by the State governments. In New South Wales, the allocation is 60 per cent to State government, 30 per cent to local government and 10 per cent to the industry concerned. Local government in this State has made a great contribution to bringing industries into country areas. Of course, this has meant an added burden to the ratepayers. Local government rates right throughout Australia have reached saturation point. There is no doubt that local government bodies require assistance from both the State governments and the Federal Government, but under the Constitution local government is to be administered and financed entirely by the State government. It is only in recent years that the Federal Government has entered this field. We find now that the grants that are being made under this legislation are a very important part of local government finance throughout Australia. The shire clerks are getting their councils' estimates ready and this Bill has been introduced at a most opportune time. Local government bodies have also taken over the trusteeships of showgrounds and recreation areas and are assisting with funds for unemployment. The Federal Government allocates funds to the various States. The Wran Government in New South Wales received $ 16m before the end of 1979. It is up to that Government to make some of these funds available for unemployment purposes. We find that the State governments are making these funds available but local government has to find money on a dollar for dollar basis in this area. Here again, of course, this places a burden on local government. One often wonders whether local government is endeavouring to take on too much financial responsibility in the social service field. Many country local governing bodies as well as their city counterparts have a social service department, a social worker and an assistant. I feel that social welfare should be the responsibility of the State governments. This area of responsibility should not be foisted onto the local government bodies. It should be a responsibility of the State governments. In New South Wales at the present time the Labor Government is hell bent on the amalgamation of shire councils and municipal councils right, left and centre. The reason it gives for the amalgamation of these councils is that it is a saving, that it is an economic measure. The New South Wales Grants Commission which is recommending the amalgamation of these councils cannot give one instance where an amalgamation has saved the ratepayer one cent. As a matter of fact, it goes the other way. Costs are increased and staff of both shire and municipal councils, when an amalgamation takes place, have to be employed for a period of two years. The chief administration of some of these local governing bodies is up for something like $120,000 a year over the amalgamations before passing on to the engineering department and the other departments of the local government bodies concerned. This is an absolutely ridiculous situation. The honourable member for Reid **(Mr Uren)** has spoken about the Regional Employment Development scheme which was in operation during the time that the Labor Government was in power here in Canberra. The RED scheme was quite all right where it involved a worthwhile project, where it employed labour and where there was adequate supervision. If there was no supervision of a RED scheme project, many times the money was wasted. Where there was supervision the results of the projects were excellent. In relation to local government finance, capital funds are not the problem of local government bodies. Plenty of loan funds are available for local government to carry out schemes. Indeed, in New South Wales at the present time, the local government rate on borrowings is of the order of 12 per cent. Of course, when local government borrows funds for various works in its area there comes a day of reckoning and these borrowings have to be repaid. This is an added burden for the ratepayers. Local government bodies receive not only assistance from us and State governments but also road funds which are made available to them by the Federal Government. They receive grants for libraries and grants towards many other facets of their particular type of government. In my electorate of Paterson we have something like 1 8 local government bodies. Some of them are shire councils, some of them are municipal councils and several of them, of course, are provincial city councils. It has been mentioned by the honourable member for Reid that this increase in local government funding to 2 per cent is one of the few promises fulfilled by the Fraser Government. This is a promise that is fulfilled by that Government, but it is not the only promise that has been fulfilled by the Government. Many other promises have been fulfilled by this FraserAnthony Government. It has been said by previous speakers that local government is the closest to the people. There is no doubt about that. The people in these areas expect a lot from local government. So the Government is making additional funds available under this Bill to enable local governments throughout New South Wales to carry out their duties and to assist the ratepayers who, I have said, are burdened with very high rates today. The rates have reached saturation point. The ratepayers are surely entitled to some assistance. As mentioned previously, it is still the responsibility of the various State governments in Australia to look after the financing of local governments. It is only in the past few years that the Federal Government has come into this field, with great benefit to local governments concerned. It is a great pleasure to support this legislation which will be of tremendous benefit to local government throughout Australia and which will be welcomed by all those councils concerned. {: #subdebate-32-0-s5 .speaker-EH4} ##### Mr HOWE:
Batman -The honourable member for Paterson **(Mr O'Keefe)** was referring to functions and responsibilities which are undertaken by local government and which ought not be the responsibility of local government. I think that there are examples of local government being quite unfairly asked to take on responsibilities- for example, in cases of major developmental projects. I am thinking of the development of an aluminium smelter by Alcoa of Australia Ltd in the city of Portland, Victoria, in the electorate of the Prime Minister **(Mr Malcolm Fraser),** Wannon. In that situation, where a private company is in the process of making a major investment which will be presumably a very profitable investment, local government has been asked, and I believe has agreed, to provide a concession of the order of 50 per cent in rates for that company. It seems to me that that represents quite an inappropriate case of local government forgoing revenue for the sake of the development of a company which in turn will put considerable pressure on that local government area to provide the range of services that will be necessary for that company and for the infrastructure which will service that development. Speaking for the moment on behalf of my electorate, which is located in the north-eastern corridor of Melbourne, I think that one has, in the first instance, to recognise that it was the Labor Government which not only initiated the provision of direct funding for local government, which has certainly been very much appreciated by the Preston, Northcote and Heidelberg councils, which are in my electorate, but also provided a relationship in terms of the way that some of those funds were spent and provided additional funds. The Government said a great deal about the restoration of local initiative. If there is one comment that I would make about this Government's record as it affects my electorate it is that it has done a great deal to destroy initiative. I refer in the first instance to the development of regional organisations of councils, which was one of the methods by which funds from the Department of Urban and Regional Development were channelled into the area of local government. Region 14, covering those three municipalities and three further municipalities in that north-eastern corridor of Melbourne, was a very effective mechanism. In the period of office of the Labor Government a number of important initiatives got under way. For example, the Darebin parkland scheme, which is an extremely important example of the conversion of an area of landpartly quarry land and a highly neglected area of the city of Melbourne- into one of the finest parklands was the result of the contribution of a substantial amount of money by the Department of Urban and Regional Development for the acquisition of some of that land for incorporation within the Darebin parklands as they have now become. That initiative has continued. It is an example of the very great co-operation that exists between the Northcote and Heidelberg councils in my electorate. An area of conservation has been created which is extremely important not only to those two municipalities but also to the whole northeastern corridor of Melbourne. Similarly, when region 14 was in existence and was receiving funds it looked at the social service and social welfare needs not simply on a municipality by municipality basis but in terms of the whole corridor, providing a framework for social planning, which is extremely important, so that the services that are developed within that area are developed with a recognition of what resources and facilities are available in the whole corridor of Melbourne. To some extent the area is shaped by the river and creek systems- the Yarra River, and the Darebin and Merri creeks. Under region 14 a study was undertaken of those waterways and the potential for conservation and development and of the recreational and other purposes that those systems represented. It would have to be said that the interest of the Commonwealth Government ceased in 1975. Some of those projects have been further developed by the State Government but the Commonwealth Government has ceased to have an interest. When I arranged for a delegation to come to Canberra in 1978 it was quite clear that this Government was not interested in talking to local government directly. Whereas there had been successful delegations in previous years, it became quite clear that local government was simply not welcome by the Government in Canberra for any serious discussions in terms of the problems that those six municipalities, representing something like 300,000 people, faced. I do not believe that the mechanism that the Government has established for inter-governmental cooperation has met that need, which was clearly manifested and demonstrated. The Advisory Council for Inter-Government Relations has been another of the gimmicks. It has no real achievements to its credit. It has not provided a real basis for communication and co-operation between local government and other levels of government. It has produced a few studies, one or two reports, but very little else. Certainly the climate has changed within the context in which one looks at local government, particularly in terms of urban and regional planning. In the past three or four years there has not been anything like the interest that was shown in the problems of cities and regional areas in the early 1970s or even during the 1960s. But that does not mean that problems that existed at that time and which were highlighted and given attention by the Labor Government have gone away. Indeed, I believe that there is an argument that if anything those problems which were identified in deprived areas of great cities have grown very much worse in the latter part of the 1970s. Of course, that is the product not simply of this Government's neglect of urban problems. It is the product of an economic recession which this Government has fostered and for which it has. been unable to manufacture policies to enable us to escape from. The Government has created, I believe very much as a direct result of its policies, quite massive unemployment within this country, and indeed very much greater unemployment than has ever existed at any previous time in the post-war period. That is undeniable. Figures that might refer simply to the past 12 months or which might be based simply on one or other of the surveys carried out do not contradict that. As the honourable member for Gellibrand **(Mr Willis)** pointed out earlier in this debate, unemployment goes well beyond the official figures, and includes those who would prefer to be in full employment but who are now in part time employment, the underemployed. It also includes those who have been discouraged from registering at all, those who have left the work force and who represent a vast reservoir of hidden unemployed. The relationship between unemployment and this Bill is quite clear in the sense that the Bill refers to income for local government being made through the States. One has to look at that flow of money within the context of wider developments. For example, one has to look at it in terms of the sharp decline in funding for capital spending for the States that has occurred since this Government came to power. In a real sense local government has a responsibility for dealing with externalities, those consequences which flow from the private capitalist system, from a market economy in which the costs tend not to be borne by the private firm but rather by the public sector. Increasingly local government is being asked to bear a greater and greater burden in terms of the social and physical costs of not only a private capitalist system but also a system which is seriously in recession. If one relates that to the failure of the Government to maintain spending on capital works, one can see how serious the problem is. I want to quote briefly from Russell Mathews' report entitled *Australian Federalism 1978.* He is referring to 1978-79, but he might be referring even more strongly to 1979-80. He says: >Any expansion in development works in 1 978-79 was thus destined to take place at the expense of the already badly run down capital stock of the Australian cities and the country's essential services and transport systems. As noted in Chapter I, it is one of the extraordinary features of Australian economic policies during recent years that a period of high unemployment has coincided with severe restrictions on public sector capital spending. He continues: >The failure of the Commonwealth and the States to agree on rational policies for public sector investment and finance has depressing implications for the Australian economy, both in the short term through its effects on employment and in the long term through its effects on standards of essential services and economic growth. In this respect, the history of the Great Depression is being repeated. No one is suggesting that by the provision of funds for local government for job creation and for employment creating purposes all the problems of unemployment that exist in this country would be solved. Nevertheless it is quite clear and it has been made quite clear by the Opposition that a very large number of useful and worthwhile jobs could be created in the local government area. In terms of the problems that my electorate faces, it requires no great imagination to think of useful works that might be carried out in the local government area. I have referred, for example, to a study which was carried out in 1977 of the waterways systems that run through my electorate. That study suggested a whole series of works which might have been undertaken to resolve the very severe problems of pollution which exist in creeks systems such as the Darebin and Merri Creeks which run through most of the northern areas of the city of Melbourne. Pollution certainly could have been substantially alleviated. Those creek systems could have been made the centre of important recreational areas. It would be possible to develop in parallel with those creeks, for example, bike-ways or forms of tracks that young people and others could use for the purpose even of commuter journeys. Those creek systems run through a whole series of municipalities and provide relatively direct links. The Melbourne *Age* newspaper has been running a program in relation to the problems of the lower Yarra River and the way in which works might be carried out close to the city to restore access to that river and to make it a much more pleasing environment. Of course the problems of that river extend a long way further than those areas on which the *Age* newspaper is placing so much emphasis. It ought to be possible to spend money, for example, in the Northcote area on the perimeters of that river which would result in a substantial expansion of recreational opportunities for an area in which those opportunities are extremely limited. In terms of transport systems within that north-eastern corridor of Melbourne, substantial public works have been deferred by this Government which would save local government considerable amounts of money and distress. Despite the fact that we have allowed major housing developments to occur in that corridor, particularly centred around Mill Park and that we have built a major university, La Trobe University, and although it has been agreed for a very long time that the tram line ought to be extended beyond Preston, at least as far as La Trobe University and certainly to the Mill Park housing development and the associated Preston Institute of Technology, that work has not developed. That extremely important piece of work could be carried out. It would expand employment opportunities and would reduce the enormous pressure of traffic on Preston and on the city of Northcote. Both those cities would regard that work as having extremely high priority in terms of saving them expenditures that are necessary for them in relation to the maintenance of roads and dealing with the traffic blight. Similarly, there is an enormous potential for expansion of social and welfare services, an area in which unemployment is extremely high, in which there is an aging population and in which there are above average levels of people dependent upon social security benefits. I certainly would not regret the possibility of local government developing further in terms of health and welfare services. It seems to me that that is the scale at which those services ought to be delivered. Why is it that local government historically has been so much associated with the cost of infrastructure? The reason for that is clearly that local government has been dominated by the interests of real estate agents, local businessmen and industrialists. The works that have been carried out by local government have, particularly in the inner suburbs of Melbourne and in cities such as Northcote, invariably been geared towards the interests of industry and very rarely been geared towards the interests of the residential population. That neglect, which has taken place over a very long period, now at a time of deindustrialisation in the inner suburbs of Melbourne, presents enormous problems to local government both to catch up in terms of the neglect of basic services existing in the past and to deal with the massive problems of unemployment which are the result of the decline of the small industries and the small firms which are characteristic of that area. It is quite extraordinary for this Government to suggest that it is any way at all interested in the concerns of small business and small scale industry. Any one who represents an electorate in which those kinds of industries are dominant knows that they have been ravaged in the past four years and that hundreds and perhaps thousands of jobs have been lost in cities like Northcote and Preston because of the recessionary policies of this Government. Of course I support the proposition that local government ought to get 2 per cent and will get 2 per cent of tax revenue. I believe that local government provides the framework for tackling a whole range of problems, some of which exist in my electorate but others of which are present in the electorates of most of the members of this Parliament. I believe that we, as a Parliament, ought to be fostering devolution and we ought to be seeking to build stronger structures at the lowest possible level. This Government, as the honourable member for Reid **(Mr Uren)** has suggested, has simply seen the problems of local government and cities in terms of the flow of funds. It has been extremely biased about where the money goes. {: #subdebate-32-0-s6 .speaker-KCT} ##### Mr DEPUTY SPEAKER (Mr Drummond:
FORREST, WESTERN AUSTRALIA Order! The honourable member's time has expired. {: #subdebate-32-0-s7 .speaker-00ATA} ##### Mr HODGES:
Petrie -The assertion made by the honourable member for Batman **(Mr Howe)** that this Government is not interested in small business is just so much nonsense and I am sure that there is not a person in this nation who believes those sorts of comments, particularly coming as they do from the left wing of the Australian Labor Party. With the passing of this Local Government (Personal Income Tax Sharing) Amendment Bill we will witness another election commitment or promise made in 1977 being fulfilled. The election pledge was that local government's share of personal income tax would be increased from the then figure of 1.52 per cent to 2 per cent in the life of this Government. In 1977-78, and again in 1978-79 because there was no increase in the figure of 1.52 per cent during the first year that this Government was in office, the 1.52 per cent applied. We saw an increase in 1979-80 to 1.75 per cent, and of course the promise is being fulfilled now in 1980-81 with the 2 per cent of personal income tax flowing to local government. I want to examine the consistency of the Fraser Government in following through its federalism policy because there are many arms to this policy. It was announced prior to the 1975 election and it has been implemented in stages. First, there was the States (Personal Income Tax Sharing) Act which provided for 33.6 per cent of personal income tax collections to flow to the States. This figure has since been increased to 39.8 per cent. Secondly, in stage two the Commonwealth allowed the States either to make a surcharge on their population if they believed that more work should be carried out in their State or, if they felt that the population should receive a rebate, to give a rebate to their residents. The other part of Fraser federalism was that local government would share in the Commonwealth Government's personal income tax collections. I want to examine the benefits that have flowed to local government since Fraser federalism came into being. I think that one of the greatest benefits that has flowed to local government is really not connected with the Local Government (Personal Income Tax Sharing) Amendment Bill. Inflation has been reduced from close to 20 per cent under the Whitlam Government to around 10 per cent today. This reduction, of course, has been of immense benefit to local government as, indeed, it has been to all sections of our community. Secondly, tax sharing arrangements brought benefits to all local government authorities. Not only has the percentage of personal tax collections been increased, but also there has been a growth tax provision. The total personal tax collections have increased. Thirdly, these are untied grants that enable local authorities to plan decisively. Previously, assistance to local authorities was fragmented. With Regional Employment Development Schemes, area improvement programs and the like, local authorities were scrambling for funds and did not know whether they were receiving their full entitlement. How much will local government receive under this Bill? The estimate for 1 980-8 1 of 2 per cent of personal income tax collections will provide $303m. Last year the figure was $22 1.74m. The additional $81m represents an increase of 36 per cent. A question that is often posed to me is: When will local authorities receive these payments? Payment could be made in early August. However, actual payment will depend on the State Grants Commissions. There should be no delay in payments to local authorities, as many are relying on the funds to carry out valuable and important capital works in their shires and cities. I wish to make a comparison between what is being done by the Commonwealth in the way of assistance to local government and what is happening insofar as the States are concerned. Some State governments give little or no assistance to local authorities and leave them to finance their capital works and services from their own revenue raising. The position varies from State to State. However, I will take my own state of Queensland as an example. The State Government gives subsidies to local authorities for capital works. They range from no subsidy for some types of works and up to 50 per cent for others. The vast majority of projects undertaken in Queensland by local government attracts a subsidy of 15 per cent or 20 per cent. Of course, this subsidy is tied. It is a specific amount for specific types of work. On the other hand, if we make a comparison with the money that will flow to local government under this Bill, we find that the grants will be untied and that local government can do exactly what it wishes with the funds it receives. The next point I wish to examine is what happens to the $300m. The apportionment of the $300m is undertaken by the Commonwealth. The Commonwealth Grants Commission has been responsible for determining the percentage that flows to each State. Once the States have been informed of their allocations, it is the task of the State local government grants commissions to allocate the funds to individual local authorities. Questions are often asked of members- indeed, I have had them asked of me- as to whether allocations are fair and whether local authorities are satisfied with the share they receive. Some local authorities are certainly unhappy with the allocation of funds that they receive. I wish to make it quite clear that it is not the responsibility of the Commonwealth Government to allocate funds to individual local authority areas. I believe that local authorities must be vocal if they believe that they are not receiving a fair deal at the hands of their local government grants commissions. Some local authorities, at least in Queensland, are reluctant to speak out when dissatisfied with what they receive. I believe that they are reluctant to do so because they are fearful that the Queensland Government will mark them and that they will suffer financially in the handouts that may come from that Government at some future time. The fear of the Queensland Government is an indication of the dictatorial approach of that Government. Local authorities should be able to speak out clearly and critically, if they feel that is necessary, without fear of recriminations. This is not necessarily the case. Queensland's local authorities must stand firmly and ensure that the Queensland Government is fair and open in all its dealing with them. It is interesting to note that of total public expenditures in 1977-78 the Federal Government expended some 47 per cent, State governments 46 per cent and local government 7 per cent. Surely these percentages must dispel thoughts that the Commonwealth has a bottomless pit of funds from which to draw. The people of this nation must realise that, although this Government collects the major portion of taxes, it does not spend all of it. Some 39.8 per cent of personal income tax goes straight to the States in an untied form. Frequently, calls by State governments for the Commonwealth to increase expenditure are politically dishonest. State governments are powerful. They expend 46 per cent of all public moneys expended by the three levels of government. They have the capacity to raise extra revenue if they so desire. Therefore, they should shoulder more responsibility instead of palming off the blame to the Commonwealth. I next examine the level of local government rates and charges. Often it is said that local government rates are far too high. In terms of value for money the clear answer as to whether rates are too high in most local government areas is no. Generally speaking, local government is efficient. Certainly this is the case in my own State of Queensland. Where can the capital cost assets and services provided by local government be matched? Where for $300, $400 or perhaps $500 annually can people, depending on where they live, get roads, drainage, parks, gardens, water supply, sewage treatment, garbage collection, library services, child care centres, certain health services and so on? The cost amounts to $6 to $ 10 a week for each property or each family. Let us compare that rate with the cost for the supply of electricity which can run to $200 to $300 annually and that, it must be remembered, is for one commodity. This 2 per cent of personal income tax from the Commonwealth is purely some assistance to local government. I think it has to be emphasised that in no way is it intended to replace the major revenue base of local government. Local government must continue to charge ratepayers in accordance with services it provides. Cries that ratepayers cannot pay increases are so much nonsense. Councillors and aldermen who have sympathetic ears should think again. It is within the province and power of a local authority to adjust individual payment of rates by pensioners and disadvantaged persons who may be having difficulty in meeting higher rate payments. These people need not be priced out of their homes as rates rise. Local authorities must bring equity to these people by rate remissions. Some elected representatives in local government want to see massive increases in the amount of funds flowing from the Commonwealth. I say this to those people: Governments that spend the money should suffer any odium that flows from raising it. There is always a price for autonomy and independence, and local government must face up to its responsibilities in raising revenue. Concern has been expressed to me that personal income tax may not remain the main source of Commonwealth revenue. Personal income tax may fall or remain static while indirect taxes increase. This depends on government policy of the day and of course would affect revenue to local government as indeed it would to the States. This issue is often raised- and rightly so- by people involved in local government. I raised the matter with the Minister for Education **(Mr Fife),** who is at the table, when he was Minister Assisting the Prime Minister in Federal Affairs. I believe that the reply he gave me ought to become part of the record, because in it there is protection for local government. The Minister wrote to me on this matter on 4 December 1978. I wish to quote a couple of paragraphs from this letter, as follows: >I am aware of the concern of local government that personal income tax may not remain the major source of Commonwealth revenue and that such a development would have implications for the tax sharing arrangements. In the course of negotiating the tax sharing arrangements with the States, this matter was also raised by Premiers. The Commonwealth acknowledged the Premiers ! concern and agreed on the need to provide flexibility in the arrangements to meet such a situation. The Points of Understanding agreed between the Commonwealth and the States, which are included in Chapter II of Budget Paper No. 7- That was Budget Paper No. 7 of 1 977-78- >Include provisions for such flexibility: > >The Commonwealth has no formal agreement with local government equivalent to the Points of Understanding. However, local government's tax sharing entitlement is defined in the legislation as a percentage of a base amount on which the States' tax sharing entitlement is calculated. As a result, any changes in the nature of the base amount for the States, which would be agreed with the States, would be applied automatically to local government's tax sharing entitlement. > >In any event, if the Commonwealth was to proceed with a new taxation policy that disadvantaged local government, appropriate amendments would be introduced to the tax sharing arrangements. I think that clearly indicates that there is a protection for local government should the Commonwealth decide to change its revenue raising from direct taxes to more indirect taxes. I wish to raise one further matter; that is the amount which is presently allowed as tax deductible expenditure for income tax purposes. At present the figure is $300 and I believe that it should be raised to at least $400. In effect many taxpayers at present are paying personal taxation on a tax and while local government rates rise without compensatory increases in the maximum deductible figure of $300, of course the situation will worsen. Finally, I want to raise a matter in relation to the report of the House of Representatives Standing Committee on Environment and Conservation entitled 'The Commonwealth Government and the Urban Environment' which was presented to this House in May 1978. At this point the Government has yet to respond to that report. I draw the attention of the House particularly to recommendations Nos. 14 and 15. Recommendation No. 14 deals with the nonpayment of general rates by the Commonwealth Government and by State governments. Recommendation No. 15 refers to the noncompliance by the States and by the Commonwealth with local government by-laws. Recommendation No. 14 states: >The Commonwealth Government recognise explicitly its obligation to compensate municipalities for loss of general rate revenue as a consequence of Commonwealth Government immunity in respect of Crown property. There is a section (b) to that recommendation but the pertinent one is section (a) which I have just quoted. What is happening in effect is that many local authorities around this nation are being paid no general rates on large tracts of land held by the Commonwealth or by the State. In the inquiry to which I have referred evidence was taken from a number of local authorities and from the Local Government Association of New South Wales. Of course, in the course of that evidence the Association, no doubt pointing out the most blatant cases, cited the municipality of South Sydney which lost a substantial portion of its rates when the Leyland company sold its complex to the Department of Defence. That municipality suffered a further loss of rate revenue as a result of the extension of Telecom facilities and of the provision of new workshops and a container depot in the Waterloo industrial area. It suffered further because of the expansion of Sydney University and several schools in the area. Of course, there was additional vacant land owned by the Housing Commission on which it received no general rates. It was stated further that the rate revenue lost on that Commonwealth and State land in that municipality amounted to 1 5 per cent of the total rate revenue of that Council. I believe that, although one can argue that there are mechanisms to bring equality to that local authority through the State Grants Commission, there ought to be a separate Commonwealth amount allocated by the Grants Commission to local authorities which have large tracts of land held in Commonwealth and State ownership on which no rates are received by those local authorities. Finally - {: .speaker-KN9} ##### Mr Martin: -- Hooray! {: .speaker-00ATA} ##### Mr HODGES: -- It would appear from some of the cries from the Opposition that it has little or no interest in this Bill and in the funds which flow to local government. This is an important measure and ought to be treated as such by all members of this House. The final point I make is in relation to Commonwealth departments and instrumentalities complying with State and local government by-laws and regulations. Too frequently we find that both Commonwealth Government departments and instrumentalities and State Government departments and instrumentalities are not abiding by the regulations of local authorities. I believe that they ought to abide by those regulations. Of course, in many instances regulations are approved by the State governments and those governments see fit to flout the regulations. *Wednesday, 26 March 1980* Question resolved in the affirmative. Bill read a second time. Message from the Governor-General recommending appropriation announced. {:#subdebate-32-1} #### Third Reading Leave granted for third reading to be moved forthwith. Bill (on motion by **Mr Fife)** read a third time. {: .page-start } page 1188 {:#debate-33} ### ADJOURNMENT Plant Breeders' Rights- East Timor- Defence Motion (by **Mr Fife)** proposed: That the House do now adjourn. {: #debate-33-s0 .speaker-KN9} ##### Mr MARTIN:
Banks -I raise in this House tonight a matter which should be of great concern to the National Country Party. The honourable member for Angas is umming and aahing opposite, so obviously it is not. {: .speaker-KB8} ##### Mr Giles: -- Angas has been eliminated. {: .speaker-KN9} ##### Mr MARTIN: -- The seat of Angas has been eliminated; Wakefield might end up being eliminated also. The matter I raise tonight is a vital one to certain sections of my electorate. I refer to the very vexed matter of plant breeders' rights, a matter about which members of the National Country Party and the Liberal Party of Australia obviously know nothing. I will explain it to them. Plant breeders' rights or, as it is commonly called, plant variety rights protection, basically is a system of patents. {: .speaker-L0J} ##### Mr Sainsbury: -- Haven't you read the draft legislation? {: .speaker-KN9} ##### Mr MARTIN: -I point that out in case the honourable member for Eden-Monaro wants to know. Obviously he knows little about the matter, even though he supposedly represents a country electorate. It is a system of patents applicable to newly developed cultivars used commercially in agricultural, horticultural and pastoral industries. This must be of interest to hourable members opposite. Plant variety protection legislation confers on individual plant breeders or organisations employing them the right to levy and to collect royalties from the user end of the new cultivars which have been developed. These rights which are conferred by plant variety protection legislation- I hope that one day it will be introduced into this Parliamentusually extends over a period of 15 to 18 years in other countries and, in general, remains operative for the same period as patent rights remain operative in the country of origin. It offers one of the main benefits accruing to the Australian primary producer. I am forced to speak on behalf of Australian primary producers because unfortunately the Country Party is not representing them tonight. I would like some members of the Country Party to come into the House and speak in defence of their people. Because they have not done so, at this hour of 20 minutes past 12 1 have to speak on behalf of country people. One of the main benefits accruing to Australian primary producers from plant variety protection legislation would be the guarantee that the world 's best varieties of all types of crops and pastures could be imported- naturally subject to certain plant quarantine legislation- and made available for general use on the basis that the selling price would include a small royalty payable in due course to the originator of the particular new cultivar. Specific cases are known- I remind National Country Party members of this- regarding overseas originators of different varieties of plants, such as beans and wine grapes. The honourable member for Wakefield **(Mr Giles)** is out of the chamber when I am referring to wine grapes. He walked out earlier. I mention also apples and certain ornamental species. Where is the honourable member for Denison **(Mr Hodgman)** and the honourable member for Franklin **(Mr Goodluck)** when I am speaking about apples? They are not in this chamber when they should be here defending the apple growers of Tasmania. Where are they? They should be defending the apple growers of Tasmania, but they are not even in the chamber. It is only 20 minutes past 12 in the morning. Where are they? They are probably at home sleeping. Who has to get up in this chamber and defend these people? I have to. It should not be my role to do so. I am concerned tonight at the apparent inaction of certain members of the National Country Party; not all of them. There are some good members of the National Country Party, but not very many. The whole trouble is this: There appears to be a real fear about what this plant variety rights Bill might do. Apparently certain parties with a vested interest in their own rights have got at the present Minister for Primary Industry **(Mr Nixon).** The portfolio used to be Agriculture but this Minister does not know very much about agriculture. The present Minister for Primary Industry seems to have gone to water on this legislation. Why is it that this Bill, which was promised to the plant breeders and which would improve the standard of our horticulture and agriculture, has not been introduced by the Government? Is it a fact that the plant variety rights Bill has been excluded from the current parliamentary session by order of the Prime Minister **(Mr Malcolm Fraser)** on the grounds that it was not considered to be of sufficient importance to warrant introduction during this parliamentary session? The Prime Minister is not even here to answer that charge. I would like to ask the Minister for Primary Industry about the present position regarding this Bill. He is not even in the chamber and it is only 22 minutes past 12. The attitude of the Fraser Government and the present Minister is to be condemned. It is a mixture of inefficiency, procrastination and plain ineptitude. Why are National Country Party members not screaming out about it? I ask some member of the National Country Party to get up in this place and answer this charge. Why are National Country Party members not protecting the interests of people whom they are supposed to represent. I have lost faith in them, **Mr Deputy Speaker.** On that note, I sit down. {: #debate-33-s1 .speaker-L0J} ##### Mr SAINSBURY:
Monaro · Eden -- I do not want to keep people out of bed for too long but I was prompted to speak in the first place by the basic lack of knowledge of the honourable member for Banks **(Mr Martin)** about plant breeders' rights and in the second place by his basic lack of knowledge of the reasons why a Bill has not been introduced into this House. In the first place, I must say that I was surprised that a member of the Australian Labor Party had not been following the Professor Ted Wheelwright line that the plant breeders' rights legislation, if it ever comes into the place, would be a bad thing. In fact in an Australian Broadcasting Commission program called *Notes on the News* which is broadcast at 1.23 every afternoon, Professor Wheelwright put forward the view that if we ever had plant breeders' rights legislation in this country it would inevitably lead to a monopoly situation whereby, through a conglomeration of companies being involved in the breeding of plant varieties, people would be excluded from having access to the wide range of plant breeds that they should have access to. He also said that if that should happen there would also be an exclusion of many of the genetic strains we now have access to because it would be in the interest of monopolies to eliminate those genes. On the Ted Wheelwright line, I point out, as has been pointed out by the honourable member, that plant breeders' rights are an important matter to go on the legislative program. It is not possible for the genes to be eliminated. For instance, the British are at present setting up a bank of genes, as has the Commonwealth Scientific and Industrial Research Organisation in Australia, to ensure that the genes available in plant varieties that have been gathered from a number of countries throughout the world will be preserved so that in the case of a hybrid variety contracting problems with respect to nonresistance to disease the genes that have existed for thousands of years can still be called on. Plant breeders' rights will be a reality. It is important to remember why the reality will not have the effect of bringing about a monopoly situation which will exclude the genes. Another reason why a monopoly situation will not arise in Australia if we establish plant breeders' rights is that if people who care to spend money on research to produce new varieties keep the rights to those varieties for a limited period of 10 years, we would hope that after that period they would have made a reasonable profit. Other people in the community would then also have free access to those varieties so that a monopoly situation could not arise. The reason the BUI has not been introduced until this stage is that some debate is still going on as to whether the European or the American model for the Bill should be introduced into Australia. The present thinking in the Department of Primary Industry is that the American model should come in. Because of the time allotted to speakers in the adjournment debate I am not able to go into all the details. We need a standardisation of the model wherein judgments can be made by experts as to what a plant breeder's right actually is. The American model goes into ways and means of deciding whether a patent is unique, as does the European model. It is important for us to decide which one to adopt. It is also important that we make the right decision. It is important not only to research jobs in Australia, our reputation and our exports of new genes and varieties but also - {: #debate-33-s2 .speaker-CI4} ##### Mr DEPUTY SPEAKER (Mr Millar: Order! The honourable member's time has expired. {: #debate-33-s3 .speaker-EH4} ##### Mr HOWE:
Batman -I raise briefly once again the issue of East Timor, particularly Timorese refugees. I refer to an article by Peter Rodgers in the *National Times* of last Sunday entitled 'Gate shut on 200 refugees from Timor'. The article states: >Indonesia appears to have slammed the door on further departures from East Timor of people included in the Australia-East Timor family reunion scheme. In doing so it has dashed the hopes of more than 200 East Timorese still waiting to join family members in Australia under the scheme. It is quite clear that the Indonesian Government has now dishonoured the agreement it entered into with the Australian Government in 1978 to allow 600 refugees to come to Australia. Peter Rodgers in his article suggests that the reason for this- I think he may be correct- is the extreme sensitivity of the Indonesian Government towards allowing to come to Australia people who may be able to talk about what has happened in East Timor over the past four years. Fewer than half the number of people whom it was promised would be able to come to Australia have actually come. Very few of them are indigenous Timorese. It would seem to me that, as a Parliament, we will have to continue to press this issue. It seems quite incredible that the Minister for Foreign Affairs **(Mr Peacock)** who is making very strong speeches in relation to the situation in western Asia is quite clearly unable to stand up to his opposite number in Djakarta. He is quite unable to exert any serious pressure on the Indonesian Government with respect to a situation which is relatively minor in terms of the kinds of problems that exist in the world. Literally, we are talking about no more than 200 or 300 people but the Australian Government is simply not prepared to press this issue as strongly as it should be pressed. I would argue that it is being extremely weak. It is simply not creating the kind of noise that needs to be created. Peter Rodgers points out in his article that there is developing within Australia a very strong anti-Indonesian sentiment because of this issue. People are getting the message that the Indonesian Government is much tougher, in terms of people- in many ways because they have children and wives in this country- than, for example, the Soviet Union has ever been in relation to Jewish people in that country. It will not allow a family reunion in the case of 200 or 300 people whose kids are already in this country and are separated from their families. I put it to honourable members that the Minister for Foreign Affairs is being gutless on this question and that the Government is being gutless because it is not prepared to use a strong voice for fear of producing a reaction in Indonesia. The Government's policy of handling Indonesia with kid gloves will be absolutely counter-productive. It will develop in this country a very strong antiIndonesian feeling. People will not want to cooperate with Indonesia or be sympathetic to it. That will flow from the fact that they see the Indonesian Government as incredibly insensitive on this issue. I believe that they will see the Australian Government as being extremely weak. I raise this issue and will continue to do so because I believe that when the Government is talking about taking strong action in the Foreign Affairs area it ought to be able to sort out what is, relatively speaking, a minor problem such as this. If it cannot do so, why is it talking about involvement in the Indian Ocean and Arabian Sea, or about extending the ANZUS Treaty to cover a vast new ocean. It cannot even cope with a minor problem 200 or 300 refugees. **Mr DEPUTY SPEAKER (Mr Millar)Order!** The honourable member's time has expired. {: #debate-33-s4 .speaker-KSF} ##### Mr Les McMahon:
SYDNEY, NEW SOUTH WALES · ALP -- Yesterday the Minister for Defence **(Mr Killen)** brought down a White Paper which involves my electorate. I would like to discuss it in the few minutes that remain. At page 24, the White Paper states: >In eastern Australia, the New South Wales Government has agreed to defence acquisition of the unused Maritime Services Board berths adjacent to Garden Island. This will provide extra berths for RAN ships and will permit the efficient modernisation of Garden Island in a manner which will also enhance the aesthetics of the area. > >The Government intends to acquire ANL's interest in the Mort Bay container terminal in Sydney, and to use the site as a base for the deployment and logistic re-supply of elements of the Defence Force. As well as contributing significantly to our Defence Force deployment capability, the relocation of Army terminal regiment elements to Mon Bay will allow the Commonwealth to meet a commitment to NSW to transfer a further 6.S hectares of Commonwealth land at Middle Head to the control of the State. > >The Mort Bay acquisition will also give the Commonwealth guaranteed shore access to the facilities at Cockatoo Island dockyard, where a major employment-generating project is in progress. I refer, of course, to the new underwayreplenishment ship for the Navy. > >I should point out here that the Commonwealth recently transferred back to the people of New South Wales 305 hectares of prime Sydney harbour foreshore land. > >Any suggestion, therefore, that the Commonwealth is now engaged in a 'land grab' is a mathematical falsehood. These acquisitions are unquestionably in the national interest. The Minister has just brought down this White Paper but negotiations in the matter have been proceeding during the last six months. I have been involved in them with the Minister, as well as with Bill Armitage, the Chairman of the Resident Advisory Committee, Alderman Les Rodwell, the mayor of Leichhardt, Roger Degen, the State member for Balmain, and local residents. There has been a feasibility study of the area, and from that it was agreed that there be an open space for the people of the area. For the last three or four months I have asked the Minister for Housing and Construction **(Mr Groom)** whether there is any possible chance, as the bicentenary celebrations will be held in 1988, that the land will come back to the people of the area where the first settlement was made 200 years ago. That land extends from Balmain to Annandale, from Annandale to Glebe, and from Glebe to Pyrmont and from Pyrmont to Woolloomooloo. The decision brought down today by the Minister that the land go to the Army after negotiations have taken place is a little heavy on me, as the member for Sydney, in that negotiations have not taken place. This feasibility study has been submitted to the Federal and State governments, and as late as last week in the New South Wales Parliament the Minister for Planning and Environment, the Honourable Eric Bedford, stated that the Government has had no cooperation with the Federal Government and that it is willing to do the best it possibly can to bring back the open spaces and give that land back to the people. There is open space in North Sydney and the North, East and Middle Harbour but the foreshores of Sydney are still lacking in regard to many issues. Last Monday week 300 residents at the Balmain Town Hall agreed to demand from the Commonwealth Government that it give this land back to the people. I am pleased to say that the Minister expressed through his secretary when I telephoned him yesterday a willingness to discuss this matter with the Town Clerk of Leichhardt, and a deputation will see the Minister in the next couple of days. The residents in the area are very worried because of industry coming in the area, as is the case now with the Australian National Line. They are worried that in the future there could be more of the trouble that has arisen in the last 20 years. There will be more traffic, smoke and smog and residents are paying great pricessometimes $130,000- for houses in Balmain. They expect the change to come back to the people. The value of the Balmain area has dropped, and it will drop completely today. That is the reason I have had to put my views as the member looking after the area. **Mr** DEPUTY SPEAKER **(Mr MillarOrder!** The honourable member's time has expired. Motion (by **Mr Hodges)** agreed to: >That the question be now put. Original question resolved in the affirmative. House adjourned at 12.38 a.m. (Wednesday) {: .page-start } page 1191 {:#debate-34} ### PAPERS The following papers were deemed to have been presented on 25 March 1980, pursuant to statute: >Defence Amendment Act- Interim DeterminationsStatutory Rules 1980, Nos. 55, 56, 57, 58, 59, 60. > >Export Market Development Grants Act- RegulationsStatutory Rules 1980, No. 53. > >Life Insurance Act- Regulations- Statutory Rules 1980, No. 54. > >Naval Defence Act- Regulation-Statutory Rules 1980, No. 49. > >Public Service Act- Regulations- Statutory Rules 1980, No. 52. > >Public Service Arbitration Act- Public Service Arbitrator- Determinations accompanied by statements regarding possible inconsistency with the law- 1 980- > >Nos. 35 to 39- Australian Public Service Association (Fourth Division Officers). > >No. 40- Association of Architects, Engineers, Surveyors and Draughtsmen of Australia. > >No. 4 1 -Professional Officers Association, Australian Public Service. > >Nos. 42 and 43- Australian Public Service Association (Fourth Division Officers). > >No. 44- Association of Professional Engineers, Australia. > >No. 45- Association of Architects, Engineers, Surveyors and Draughtsmen of Australia. > >No. 46- Association of Professional Engineers, Australia. > >No. 47- Amalgamated Metal Workers' and Shipwrights Union and others. > >No. 48- Federated Storemen and Packers Union of Australia. > >No. 49- Association of Professional Engineers, Australia and another. > >No. 50- Association of Architects, Engineers, Surveyors and Draughtsmen of Australia. > >No. 5 1- Professional Officers' Association, Australian Public Service. > >No. 52- Association of Officers of the Commonwealth Scientific and Industrial Research Organisation and another. > >No. 53- Amalgamated Metal Workers' and Shipwrights Union and others. > >No. 54- Federated Liquor and Allied Industries Employees Union of Australia. > >No. 55- Australian Theatrical and Amusement Employees Association. > >No. 56- Professional Musicians Union of Australia. > >No. 57- Australian Broadcasting Commission Senior Officers ' Association and another. > >Nos. 58 to 60- Australian Journalists Association. > >No. 6 1 -Royal Australian Nursing Association.* > >No. 62- Association of Professional Engineers, Australia and others. > >No. 63- Association of Architects, Engineers, Surveyors and Draughtsmen of Australia. > >Nos. 64 and 65- Hospital Employees Federation of Australia. > >No. 66- Administrative and Clerical Officers Association, Commonwealth Public Service. > >No. 67- Actors' and Announcers' Equity Association of Australia. > >No. 68- Administrative and Clerical Officers' Association, Commonwealth Public Service and others. > >No. 69- Professional Officers Association, Australian Public Service. > >No. 70- Amalgamated Society of Carpenters and Joiners of Australia and others.* (* Not accompanied by statement) > >Quarantine Act- Regulations- Statutory Rules 1980, No. 51. > >Seat of Government (Administration) ActOrdinances 1 980- > >No. 4- Court of Petty Sessions (Amendment). > >No. 5- Coroners (Amendment). > >No. 6- Companies (Amendment). > >No. 7- Betting (Totalisator Agency) (Amendment). > >Regulations- 1980- No. 3 (Adoption of Children Ordinance and others). > >States Grants (Petroleum Products) Act- Amendment of the schedules to the subsidy schemes in relation to the States of New South Wales and Victoria, dated 13 March 1980. > >Student Assistance Act- Regulations- Statutory Rules 1980, No. 50. {: .page-start } page 1193 {:#debate-35} ### ANSWERS TO QUESTIONS The following answers to questions were circulated: {:#subdebate-35-0} #### Employment Discrimination Committees (Question No. 4403) {: #subdebate-35-0-s0 .speaker-KH4} ##### Mr Barry Jones:
LALOR, VICTORIA · ALP asked the Minister for Employment and Youth Affairs, upon notice, on 22 August 1979: >What has been the outcome of discussions with the States, national employers' organisations and the trade union movement on the possibility of providing a unified and coherent legislative basis for the National and State Employment Discrimination Committees established pursuant to International Labour Organisation Convention No. 1 1 1- Discrimination (Employment and Occupation), 1958, which Australia ratified on 15 June 1973 *(Hansard,* 12 April 1978, page 1475). {: #subdebate-35-0-s1 .speaker-EE6} ##### Mr Viner:
LP -- The answer to the honourable member's question is as follows: >The NLCC has been advised that it is the Government's view that the Committees on Discrimination and Occupation are the appropriate bodies to deal with employment discrimination matters. > >Advice has been sought from the NLCC of the Council's views on the appropriate form for legislation to establish the Committees on a statutory basis. > >When this response has been received and considered, the Government will formally take the matter up with State Governments. Lead in Petrol (Question No. 4802) {: #subdebate-35-0-s2 .speaker-QH4} ##### Mr Kerin:
WERRIWA, NEW SOUTH WALES asked the Minister for Health, upon notice, on 9 October 1 979: {: type="1" start="1"} 0. 1 ) Has his attention been drawn to a report by the University of New South Wales entitled Lead Burden of Sydney School Children which raises serious concern about elevated lead burdens in 1,500 school children. 1. Does the report show that 42 per cent of children at a Mascot school and 22 per cent of children at a Mosman school had levels of over 25 micrograms of lead per 100 mis of blood. 2. Have overseas studies indicated that children with elevated lead levels in their milk teeth perform significantly worse on a range of IQ and other neuropsychological tests and have poorer concentration, oral skills and classroom behaviour. 3. What steps is he taking to (a) screen Australian children at risk for elevated lead or lead activity, (b) urge the Government to eliminate lead in petrol and (c) urge positive measures to reduce air polution from motor vehicles. {: #subdebate-35-0-s3 .speaker-0I4} ##### Mr MacKellar:
Minister Assisting the Prime Minister · WARRINGAH, NEW SOUTH WALES · LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) Yes, I am aware of the findings of the report, as it was financed in part by the National Health and Medical Research Council (NH & MRC) and has been closely studied by my Department. I am, however, unable to determine the source of the figure of 1,500 for the number of school children with elevated blood lead levels quoted by the honourable member. The survey itself was conducted on 1,200 children, not all of whom had blood lead values of concern. {: type="1" start="2"} 0. The report, in fact, shows that 42 per cent of children at the Mascot school and 26 per cent (not the 22 per cent quotes by the honourable member) of children at the Mosman school had blood lead levels above 25 ug/ 100 ml blood in the spring 1974 survey. The corresponding figures in the Autumn 1975 survey were 18 per cent and 14 per cent respectively. 1 1.5 per cent of all the Sydney schoolchildren in the Spring survey and 3.3 per cent in the Autumn survey had blood lead levels above 30 ug. 1. A recent US study (Needleman et al, 'Deficits in psychologic and classroom performance of children with elevated dentine lead levels', N. *Eng.* J. Med., 300: 689-95, 1979) showed that children with high lead levels scored significantly less well on the Wechsler Intelligence Scale for Children (revised) than those with low lead levels. The study concluded that lead exposure, at doses below those producing symptoms severe enough to be diagnosed clinically, appeared to be associated with neuropsychological deficits that may have interfered with classroom performance. 2. (a) Screening of Australian children has been considered by my Department and the question of lead metabolism in children has been referred to the Nutrition Committee of the National Health and Medical Research Council. {: type="a" start="b"} 0. The concern of health authorities in relation to the general population is the reduction of lead in forms which can be inhaled, absorbed or ingested into human tissue. The NH & MRC has recently denned appropriate goals which will assist in consideration of the wider implications relating to lead in petrol. Positive measures have been taken to reduce air pollution from motor vehicles by the definition by the NH & MRC of appropriate goals for lead and photochemical oxidants. The details of these recommendations are as follows: Criteria for atmospheric lead Council noted that on present knowledge, lead had no essential role or beneficial effect for humans, and that the total body burden of lead, for persons not occupationally exposed, was derived mainly from food, air and water. It is noted that recent investigations had indicated that lead levels lower than those previously thought to be significant may now be producing adverse health effects. The contribution to the total body lead burden by food and other ingested substances remained of concern in spite of efforts made by Council over many years to reduce lead uptake from the many varied sources. Further efforts to effect overall reductions were considered essential. Having considered extensive Australian and overseas data, Council recommended that 30 ug lead/ 100 ml blood in the Australian population be taken to represent a level of concern. The maintenance of blood lead levels below this figure would ensure adequate protection from the potentially harmful effects of lead, particularly in the more susceptible groups such as children and pregnant women. A geometric mean lead level of 15 ug/100 ml blood would ensure that the majority of the population at risk would not exceed the recommended level of concern. Council accepted that 20 per cent of the total body lead burden could be contributed by lead in air, particularly in areas subject to heavy pollution, and that, consequently, of the geometric mean level of 15 ug/100 ml of blood, up to 3 ug/ 100 ml of blood could be attributed to lead derived from the air. It also accepted that a general relationship of 1:2 between air lead (ug Pb/m3) and blood lead (ug Pb/ 100 ml) was appropriate. In accepting the above air/blood relationship, Council recommended that the maximum permissible level of lead in air in the urban environment should be 1.5 ug/m³ averaged over 3 calendar months, the level of 1.5 ug Pb/m1 being an average 3-month level calculated on the basis of 15 x 24-hour samples collected over a 3-month period taken at 6 day intervals thereby ensuring that samples were collected on different days of each week. It recommended that State health authorities be urged to institute programs directed towards compliance with these recommended goals. Council stressed that goals for lead and similar toxic substances remain subject to review with the passage of time and in the light of future medical and technological advances. Levels for photochemical oxidants Council recognised the need to safeguard the health of the Australian population from the potential hazards resulting from raised photochemical oxidant levels to which they may be exposed. It examined all available reports and literature, and considered that there was sufficient scientific information available to allow the determination of a photochemical oxidant level, based on human health effects, defined by adopting ozone as an indicator of the degree of photochemical oxidant formation. Council therefore considered that, as a long term goal, the number of days in a year, with maximum hourly average ozone concentrations above 240 ug/m³ (0.12 ppm) should not exceed one. It recommended that action designed to attain this goal should be implemented as soon as possible. It recognised that authorities responsible for the design and implementation of control strategies to achieve this goal will need to take account of the statistical distribution of ozone concentrations. Council also recommended that a public warning should be given when ozone levels are expected to rise above 500 ug/m³ (0.25 ppm) to enable appropriate precautionary measures to be taken. It stressed that the goals for ozone and related air pollutants should be subject to review in the light of new medical and technical knowledge. {: type="a" start="c"} 0. As foreshadowed by my colleague the Minister for Transport in his statement to the Parliament on motor vehicle emissions during April 1979, and by the Prime Minister in his energy policy statement in June 1979, the Commonwealth is studying the development of a more effective long term emissions strategy which is capable of jointly achieving health, environment, and energy objectives. This study is being progressed in consultation with the States through the Australian Transport Advisory Council (ATAC). Preliminary results of the study were announced following the ATAC meeting on 8 February 1 980. Pay-roll Tax Exemptions (Question No. S0O2) {: #subdebate-35-0-s4 .speaker-9E4} ##### Mr Dawkins: asked the Treasurer, upon notice, on 25 October 1979: {: type="1" start="1"} 0. 1 ) What sum has the Australian Government paid to each State Government to compensate the States for pay-roll tax exemptions for each year since 1 972. 1. What are the bodies or organisations for which State Governments claim Commonwealth compensation on payroll tax exemption. 2. ) What sum was claimed for each body or organisation in each year since 1 972. {: #subdebate-35-0-s5 .speaker-ZD4} ##### Mr Howard:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. 1 ) At the June 1 97 1 Premiers ' Conference, the Commonwealth agreed to transfer pay-roll tax to the States on the basis that, subject to certain qualifications, there would be offsetting reductions in financial assistance grants paid to the States by the Commonwealth. One of the qualifications was that the deductions from the financial assistance grants would be reduced by an amount equal to the estimated pay-roll tax payable in respect of 'non- business ' activities of local authorities. The effect of this was that the Commonwealth would meet the cost of exempting these activities by way of higher financial assistance grants to State Governments than would have been paid if the authorities had not been exempted. Commonwealth and State legislation to transfer pay-roll tax was passed and the transfer took place as from 1 September 1971. The following amounts representing notional pay-roll tax collections at 2.5 per cent on 'non-business' wages and salaries of local authorities paid on or after 1 September 197 1 were added to the respective States' financial assistance grants for 1971-72: The amounts were agreed between the Commonwealth and State Treasuries and were formally determined by the then Treasurer in accordance with the State Grants Act 1 97 1 . A notional full-year figure of pay-roll tax collections on 'non-business' wages and salaries of local authorities in 1971- 72 was incorporated in each State's base amount for purposes of calculating its financial assistance grant for 1972- 73. The base amount for the State concerned was then increased by application of a formula which took account of the change in the population of the State, the increase in average wages for Australia as a whole, and a betterment factor of 1 .8 per cent. The amounts included in the respective States' base amounts were: In succeeding years up to and including 1975-76, the financial assistance grant for each State was determined by increasing the grant payable to it in the preceding year by reference to the formula described above. Details of calculations were published in relevant issues of Budget Paper No. 7 'Payments to or for the States and Local Government Authorities'. In 1976-77, the system of financial assistance grants was replaced by the present system of tax sharing; under these arrangements the States are entitled, subject to certain guarantees, to receive annually a specified share of net personal income taxation collections by the Commonwealth. During the period 1976-77 to 1979-80, the States are guaranteed that their entitlements will not be less in a year than the amount which would have been yielded in that year by the financial assistance grants formula. Details of calculations of States' tax sharing entitlements are set out in the 1977-78, 1978-79 and 1 979-80 issues of Budget Paper No. 7. {: type="1" start="2"} 0. Pay-roll tax, except for pay-roll tax in Commonwealth mainlaind Territories, has been a State matter since I September 1971. An example of relevant State legislation enacted in 197 1 was the New South Wales Pay-roll Tax Act, 1971 which exempted from the tax all wages paid by councils except those paid in respect of business undertakings or activities- Under the Act business activities included those connected with the supply of electricity or gas, water supply, sewerage, the conduct of abattoirs, of public food markets, of parking stations, of cemeteries, of crematoriums or of hostels or of any other activity that is a trading activity within the meaning of Part XVII of the (N.S.W.) Local Government Act, 1919. 1. As explained in the answer to Part ( 1 ), payments in relation to exemption of 'non-business' activities of local authorities from State pay-roll were made by the Commonwealth by way of notional aggregate amounts which were added to States' financial assistance grants. Payments were not made in respect of individual bodies or organisations. The benefit gained by each body or organisation each year has been the amount of pay-roll tax it would otherwise have been required to pay.

Cite as: Australia, House of Representatives, Debates, 25 March 1980, viewed 22 October 2017, <>.