House of Representatives
23 November 1978

31st Parliament · 1st Session

  1. House of Representatives
  2. 31st Parliament
  3. 1978

Mr SPEAKER (Rt Hon. Sir Billy Snedden) took the chair at 10.30 a.m., and read prayers.

page 3267

PETITIONS

The Clerk:

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

The Budget

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

The humble Petition of we the undersigned citizens of Australia respectively showeth-

That because this budget will further increase the number of persons unemployed, because it reduces the average worker’s spending power by $10 per week, because it will reduce the income of pensioners, because it is unfair in placing a greater burden on the poor rather than the rich, and because it is driving this country into a depression.

Your petitioners therefore humbly pray that

The Federal Government withdraws this budget and provides Australia, within this session of Parliament, with a revised budget that increases the level of economic activity in Australia, lowers unemployment, removes the burdens placed on the disadvantaged, and revives business and consumer confidence in the future of this potentially great country.

And your petitioners, as in duty bound, will ever pray. by Mr Armitage, Mr Charles Jones, Mr Kerin and Mr Uren.

Petitions received.

Retail Oil Industry

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

We citizens of the Commonwealth, employed in the small business sector of the oil industry, earnestly request our government to implement, as quickly as possible, the package of measures as announced by the government on 3 1 October 1 978, designed to ensure that many thousands of Australia’s small businessmen and their employees be retained in the retail oil industry.

And your petitioners as in duty bound will ever pray. by Mr Dobie, Mr Graham, Dr Klugman and Mr Ruddock.

Petitions received.

Pornographic Publications

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 we the undersigned, having great concern at the way in which children arc now being used in the production of pornography call upon the Government to introduce immediate legislation:

  1. To prevent the sexual exploitation of children by way of photography for commercial purposes;
  2. To penalise parents/guardians who knowingly allow their children to be used in the production of such pornographic or obscene material depicting children;
  3. To make specifically illegal the importation, publication, distribution and sale of such pornographic child-abuse material in any form whatsoever such as magazines, novels, papers or films;
  4. To take immediate police action to confiscate and destroy all child pornography in Australia and urgent appropriate legal action against all those involved or profiting from this sordid exploitation of children.

Your petitioners therefore humbly pray that your honourable House will protect all children and immediately prohibit pornographic child-abuse materials, publications or films.

And your petitioners as in duty bound will ever pray. by Mr Corbett, Mr Hodges and Mr Martyr.

Petitions received.

Australian Broadcasting Commission

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 says we are concerned about the deteriorating standards of ABC radio and Television programmes.

Your petitioners therefore humbly pray that Parliament take immediate steps to appoint an independent inquiry into the ABCwhich:-

  1. Investigates the practical experience and qualification of the commissioners to perform their duties.
  2. Determines the effects of staff ceilings and reduction of funds, in real terms, on standards.
  3. Thoroughly reviews the organisation to determine its present effectiveness.
  4. Ascertains if any external or internal censorship exists.
  5. Makes recommendation to reduce censorship and improve the efficiency and standards.

And your petitioners, as in duty bound, will ever pray. by Mr Armitage and Mr Staley.

Petitions received.

Medical Benefits: Abortions

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 provision of payments for abortion through items of the Medical Benefits Schedule is an unacceptable endorsement of abortion which has now reached the levels of a national tragedy with at least 60,000 unborn babies being killed in 1977.

Your petitioners therefore humbly pray that the Government will so amend the Medical Benefits Schedule as to preclude the payment of any benefit for abortion.

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

Petition received.

Aboriginal Land Rights

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

The humble petition of undersigned citizens of Australia respectfully showeth-

That, contrary to election promises, the Federal Government is progressively dismantling Medibank to the detriment of those most in need and, in the long run, at the expense of national health.

Your Petitioners most humbly pray that the House of Representatives in Parliament assembled, should- retain bulk billing; ensure that there be no decrease in refund rates; ensure that long term hospital patterns be not penalised; continue refunds on termination of pregnancy; pledge that no further cuts in Medibank be made.

And your petitioners, as in duty bound, will ever pray etc. by Dr Everingham.

Petition received.

Medibank

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

This petition of citizens of Australia respectfully showeth that

  1. . Australia ‘s Aboriginal and Islander peoples have not been compensated for the loss of their traditional land, social and cultural independence and self-respect.
  2. Australia lags behind other nations with white majorities in providing a Treaty of Commitment to its indigenous peoples giving them ° a defined proportion of national income for a defined period ° freehold title to traditional land, waterways and seaboards, ° control over related resources and over the introduction of alcohol and other alien cultural influences in their regions.

Your petitioners therefore humbly pray that your honourable House will take urgent steps to concur with the wishes of a majority of electors at every polling booth in Australia at the 1976 referendum by resumption from the States of the major traditional Aboriginal land areas and reserves and former reserves as at 3 1.3.78, to become federal Crown land pending prompt determination of freehold title for Land Trusts and eventually for defined community co-operatives.

And your petitioners, as in duty bound, will ever pray. by Dr Everingham.

Petition received.

Australian Capital Territory: Water Pollution

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 they are deeply concerned at the increasing pollution of areas within the ACT, and in particular Jerrabomberra Creek and its tributaries, especially in the area near the Integrated Forest Products plant and the Larry’s Creek and Paddy’s River. that pollution is a dangerous threat to the fragile ecology of these areas and is causing severe economic difficulties for individual people, especially in these areas. that there is completely inadequate environmental protection laws at the moment in the ACT. that there is an inadequate interest within the administration of the ACT for the problems caused by pollution, especially those problems which affect the livelihood of people who suffer through pollution. your petitioners therefore humbly pray that the concern of those undersigned shall be recognised by the Parliament, and that the petition will not be simply forgotten among the many which the Parliament receives. that action will be taken urgently to establish proper environmental standards to prevent water pollution in the ACT. that breaches of the law setting out those standards should be treated with the greatest seriousness.

And your petitioners, as in duty bound, will ever pray. by Mr Haslem and Mr Hodgman.

Petitions received.

Broadcasting: Radio 3CR Melbourne

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

That Radio 3CR Melbourne, be made to adhere to the required standards of broadcasting, as laid down for all other radio stations.

Your petitioners therefore humbly pray that the government will enforce the required standard of broadcasting as laid down for all other stations, on commmunity radio 3CR call on Federal Government to legislate against incitement to racial hatred and violence. by Mr Roger Johnston.

Petition received.

Medibank

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-

That we believe the Federal Government changes to the health insurance system are unjustified, costly and artificially bureaucratic.

The planned abolition of bulk billing will place an unnecessary burden on the poor and the disadvantaged in our community. The decision to reduce the rebate paid from 85 per cent to 75 per cent of the scheduled fee is an attack on real wages.

Your Petitioners therefore humbly pray that the Government should reverse its decisions on these matters and develop proper consultation with the trade unions and the community.

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

Petition received.

South Australian Country Rail 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:

  1. That any downgrading or closures of Country Rail Services in South Australia would have grave consequences for the Railway Industry, Primary Industry, Individual Country Communities and the State as a whole and calls on the Parliament to ensure that the Federal Minister for Transport takes the necessary action to maintain all existing services.
  2. That continued and increased Public Subsidy is fully justified in the long term National Interest. by Mr Porter.

Petition received.

Royal Commission on Human Relationships

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

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

That because the Report of the Royal Commission on Human Relationships and especially its Recommendations-

  1. Have been widely condemned for its support of unAustralian, anti-family, anti-child behaviour and morals such as incest, promiscuity, abortion, pornography, homosexuality, prostitution and brothels, etc. (Note: Refer quotations reverse side)
  2. Have been strongly criticised by the medical profession for the absence of any medical practitioner on the Commission or on its staff of 3 1 persons, and for the Commissioners action in rejecting or ignoring relevant medical evidence.
  3. Have been discredited as irresponsible in adopting a new definition of the family, i.e., ‘a varying range of people living together in relationships of commitment’, which has effectively confused the real meaning and intentions of the Report where it refers to the ‘ family ‘.

Therefore the Parliament has a responsibility to the families of Australia not to adopt this controversial report and its Recommendations.

Your petitioners therefore humbly pray:

That the Australian Parliament will:-

  1. Simply receive the Report and not adopt its recommendations,
  2. Set up a Select Parliamentary Committee along the lines of the New Zealand Select Committee to conduct a public inquiry into the ways and means of supporting and strengthening family life and providing adequate protection for children from physical and sexual abuse before as well as after birth in accordance with the UNO Declaration of the Rights of the Child as part of Australia ‘s support for the Year of the Child.

Your petitioners therefore humbly pray that your honourable House will take no measures concerning the Royal Commission on Human Relationships Report that will further undermine and weaken marriage, child-care or the family which is the basic unit of our society.

And your petitioners, as in duty bound, will ever pray. by Mr Ian Robinson.

Petition received.

Political Asylum

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

It appears, from reports in the Australian Press, that Jacob Prai and Otto Ondowame, refugees from West Irian who are now imprisoned in Papua New Guinea, may seek political asylum in Australia. It is clear that if asylum is not granted, their lives are in serious danger.

Your petitioners therefore humbly pray:

That, in the interests of human rights, the Australian Government immediately grant this asylum if it is sought.

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

Petition received.

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QUESTION

QUESTIONS WITHOUT NOTICE

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QUESTION

TAXATION OF HOUSING ACCOMMODATION

Mr HUMPHREYS:
GRIFFITH, QUEENSLAND

– I refer the Treasurer to his statement of 12 July in which he announced the Government’s decision to review the section of the Income Tax Assessment Act dealing with the taxation of housing accommodation and to his assurance that pending the outcome of the review the Commissioner of Taxation has decided not to pursue current initiatives in the matter. Is it a fact that the Taxation Office is continuing to tax workers in the sugar industry on the value of their company housing and that objections against those assessments have been dismissed? If so, how can the Treasurer reconcile this fact with his statement of 12 July and with the fact that workers in other industries are not being assessed on the value of their houses?

Mr HOWARD:
Treasurer · BENNELONG, NEW SOUTH WALES · LP

– The reference to current initiatives in my statement of 12 July was to current initiatives in the sense of fresh valuations by the Commissioner of Taxation to be assigned to particular housing accommodation. I should mention that although the procedure adopted by the Commissioner of Taxation in a number of industries is for him to assign a value, the final determination of whether that is a fair value or not in terms of the Income Tax Assessment Act is something that an individual taxpayer can pursue through the usual review and appeal procedures of the Act. The honourable gentleman’s question echoes a concern expressed by a number of members on both sides of the House that the matter be resolved.

I can understand the honourable gentleman’s interest and also that of other Queensland members on behalf of sections of the sugar industry. Only in the last couple of days I have requested that preparation of the necessary submission to the Government on the review of section 26E be expedited as much as possible. I should add, finally, that a review of the section will not be an easy matter because obviously the Income Tax Assessment Act must contain a provision which in broad terms provides for taxation of surrogate income.

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QUESTION

MINERAL EXPORT CONTROL GUIDELINES

Sir William McMahon:
LOWE, NEW SOUTH WALES · LP

– My question is directed to the Minister for Trade and Resources.

Has he received a letter from the Australian Mining Industry Council which in substance rejects the present mineral export control guidelines? Will the Minister be good enough to table this letter in the House or make it available to members? I understand that the letter is not confidential and is not intended to be. Is the substance of the letter similar to the substance of a statement released late yesterday by the Council setting out the free enterprise principle that the marketplace provides the most efficient system known for the allocation of resources? Is not this wholly consistent with the Liberal and National Country Party philosophy and platform?

Mr ANTHONY:
Deputy Prime Minister · RICHMOND, NEW SOUTH WALES · NCP/NP

-The statement put out by the Australian Mining Industry Council is basically consistent with and similar to a letter written to me which I received this week. It is a consistent attitude of the Australian Mining Industry Council that it believes in the free enterprise system, as I do, and that there ought to be the minimum of Government involvement in the operation of the sale of Australian minerals, as I believe. On this side of the House, we all remember only too well, and I know that the Austraiian rnining industry remembers only too well, the disruption, the lack of confidence and the confusion that can be caused when there is undue government interference. The days of 1972 to 1975 will not be forgotten. I am sure, however, that the Mining Industry Council recognises that the Commonwealth Government has national responsibilities and that the national interest must be attended to. However, AMIC does not seem to understand that the announced guidelines on the export controls are not trying to beat the market force nor are they attacking the single buyer practice of the Japanese. We are trying to support the negotiating position of Australian exporters to enable them, through a more co-ordinated approach, to deal fairly with such buyers. In the very difficult market circumstance of today, such support is required in the national interest.

Last Friday I met all the representatives of the Australian coal rnining industry. All of them said that they were prepared to work under the guidelines. A few companies, basically overseas companies, stated a point of view that they did not want any controls operating on them- that has been a consistent attitude of those companies- but that they are prepared to give the guidelines a try. As I said, I do not believe, nor does the Government believe, that there should be undue interference or exercise of export controls. My Department is reviewing the whole operation of the use of export controls outside the areas that have already been announced, that is, coal, iron ore, bauxite and alumina. Shortly a report will come to Cabinet as to whether export controls ought to apply to other forms of ores or minerals. I hope to be in a position to make an announcement shortly.

I would be very disappointed if the great bulk of the controls which are now operating could not be eliminated to enable industries to operate in free market circumstances. As I mentioned, pressures are being applied to some of our mining industries, particularly the coal mining industry at the moment. There is a need for that industry to work together in a co-ordinated way to see that it obtains the best and fairest return. In doing that it will be acting in the national interest.

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QUESTION

AUSTRALIAN BROADCASTING COMMISSION

Mr HAYDEN:
OXLEY, QUEENSLAND

– I ask the Minister for Post and Telecommunications: Is it a fact that the Chairman of the Australian Broadcasting Commission, Mr Norgard, has written to the Minister protesting at the Government’s interference in the Commission’s administration? Was Mr Norgard particularly critical of the Government’s decision to reduce further ABC staff ceilings without any consultation with the Commission? Do Mr Norgard ‘s criticisms parallel those of the former Chairman of the Commission, Sir Henry Bland, who complained in 1976 that the ABC has been cut to the bone’? Will the Minister reassure the House that the Government’s policies of financial attrition against the ABC are not simply a device to exert stringent political control over the operations of the ABC?

Mr STALEY:
Minister for Post and Telecommunications · CHISHOLM, VICTORIA · LP

-I can assure the House that the Government’s very proper policies of financial restraint in the difficult circumstances with which Australia is faced have not in any way amounted to a campaign of attrition against the Australian Broadcasting Commission, nor have they in any way amounted to an attempt to infringe the independence of the ABC. The ABC has understood that in difficult times it has been necessary for the ABC to take budgetary restraints, as have all other areas of government expenditure. It is true that the Chairman of the ABC has written to me recently indicating in clear terms certain problems which the ABC has faced. I can give the House an assurance that the Government is having a look at the matters which the Chairman has raised.

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QUESTION

MINERAL EXPORT CONTROL GUIDELINES

Mr COTTER:
KALGOORLIE, WESTERN AUSTRALIA

-I direct to the Deputy Prime Minister and Minister for National Resources a question which relates to the same matter as that raised by the honourable member for Lowe, but which is different from that question and is quite specific. I refer to the Minister’s recent announcement regarding’ export control guidelines for bulk minerals. Will the Minister agree that Australian producers of bulk raw materials have been relatively well treated in the past by Japanese buyers and that the producers have a good record of development, using to good advantage their negotiating ability? In the face of mounting evidence that government interference in the market place will harm Australia’s trading position in the long term, will the Minister now modify his statement, taking into consideration the overwhelming body of opinion, and bring his approach into line with the free enterprise philosophies of the coalition?

Mr ANTHONY:
NCP/NP

– I thought I gave an indication that the first group of industry representatives I met- there is an urgent requirement for coal producers to come to some resolution- are of the overwhelming opinion that there needs to be be a co-ordinated approach to the selling of Australian coal and that everybody is prepared to work towards that end. The point that needs to be made loudly and clearly is that the national interest, has to be looked after and that there needs to be some government involvement in bringing together the various sections of industry. As I have pointed out, that can be done only by means of a direction from me to bring them together for the purpose of protecting the foreign companies from the United States anti-trust laws. That direction has been given.

Certainly we have done very well in our dealings with the Japanese. We are pleased to work with the Japanese. Australia has a special relationship with Japan in relation to the sale of our minerals to that country. There is a mutual interdependence between our two countries. However, I think one would have to acknowledge that at the moment it is a buyer’s market. Heavy pressures are being put on some of our exporters. When there is a single buyer it has the capacity to divide the industry in order to gain the best possible price. One recognises that fact and one should not complain about it. A real complaint can be made only if one does not take some measures to try to get the best out of those circumstances. That is what the Government is doing at the moment in producing guidelines. It is doing so merely to help in the negotiations. It is not trying to resist market forces but is trying at least to establish a co-ordinated approach by all Australian producers. In accomplishing that objective I am having talks with industry representatives and with the State governments. In that way everybody can have a better understanding of what the Government is aiming to achieve.

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QUESTION

BUTTER FAT

Mr LLOYD:
MURRAY, VICTORIA

-The Minister for Primary Industry will be aware of criticism to the effect that the Commonwealth Government has taken a long time to consider a request from the Victorian Government to administer that Goverment ‘s promise of establishing a minimum price of 80c per lb of fat in milk for prescribed dairy products for Victorian dairy farmers for the current season. What is the situation?

Mr SINCLAIR:
Minister for Primary Industry · NEW ENGLAND, NEW SOUTH WALES · NCP/NP

– The honourable member will recall that on 19 May 1978 I announced, on behalf of the Commonwealth Government an offer to dairy farmers around Australia to underwrite a selected range of manufactured milk products up to 75c per lb butter fat. At the same time, on behalf of the Federal Government, I added that if the respective State governments would be prepared to join with us, we would be prepared to provide underwriting for dairy products up to 80c per lb butter fat. About four months later, I received an approach from the Victorian Government to the effect that, not on the terms of our offer but on other terms, it would be prepared to join the Commonwealth in ensuring that Victorian dairy farmers received a guaranteed price of 80c per lb butter fat. Therefore, the responsibility is predominantly with the Victorian Government to ensure that that increase of 5c per lb butter fat is paid to Victorian farmers. The offer that we made was not accepted in a formal way. The offer made by the Victorian Government was designed specifically to meet, as it saw it, the circumstances of the Victorian dairy industry.

Several important issues apply. On a number of occasions, within the Australian Agricultural Council and in concert with the agricultural Ministers of the respective States, I have said that the Government is concerned that Australian dairy products should reach a point of approximate equilibrium with the available world markets. Of course, it is a problem to ensure that we produce dairy products that we can sell and for which the dairy farmers throughout Australia can be paid a fair price. It was with that objective in mind that the Commonwealth Government entered into the underwriting arrangements designed specifically to give dairy farmers a guaranteed minimum income.

However, there are problems, in the legal sense, of looking at only one State in providing an arrangement in the form that the Victorian Government has suggested. I have said to the Victorian Government that, as far as possible, we will seek to provide it with whatever assistance is possible within the Austraiian Dairy Corporation to ensure that it is able to fulfil the commitment it made to Victorian dairy farmers. However, there are difficulties on the legal side. Firstly, the nature of the payment would require a resolution of the Federal Parliament to ensure that under section 91 the payments could be made by the Victorian Government. An approach on that basis was initially rejected by the Victorian Government. At this stage it seeks a modification of the legislation so that the payment can be made by the Commonwealth as, I understand, its Budget has not provided for funds to make that supplementary underwriting payment. It was only this week that I received formal advice from the Commonwealth Attorney-General as to the form and manner by which that type of amendment could be constitutionally possible.

Mr Uren:

-i take a point of order, Mr Speaker. The Minister has been speaking for nearly five minutes.

Mr SPEAKER:

-The honourable gentleman will resume his seat. I ask the Minister to draw his answer to a conclusion.

Mr SINCLAIR:

-Once again the Labor Party has demonstrated a complete lack of interest in what is a major problem for Victorian dairy farmers.

Mr Uren:

- Mr Speaker, you have consistently stated that, with the exception of the Prime Minister, Ministers should make their replies brief and to the point. This Minister has a right to make a statement after Question Time if he so wishes. He is wasting Question Time. I ask you to remind him of your earlier ruling that all Ministers, with the exception of the Prime Minister, should make replies brief.

Mr SPEAKER:

-I ask the Minister to do two things: One is not to comment on my ruling and, secondly, to draw his answer to a conclusion.

Mr SINCLAIR:

– Certainly, Mr Speaker. I think it is of interest to members of this House, however, to note that the new resolve of the Labor Party Executive to concentrate on country seats around Australia was shown in its true light by the honourable gentleman in his intervention a moment ago. The problem is a legal one essentially, and a constitutional one. Unfortunately, because we have just received the advice, it will now be necessary for us to develop legislation. If that is the way by which the payments have to be made to Victorian dairy farmers, legislation will be introduced into this place when the House resumes in the new year. In the meantime perhaps the Victorian Government can make the payments as that is its undertaking and its commitment to dairy farmers in that State.

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QUESTION

FRASER ISLAND RESTORATION

Mr COHEN:
ROBERTSON, NEW SOUTH WALES

-I ask the Minister for Environment, Housing and Community Development a question supplementary to that asked by the honourable member for Wide Bay last week. Despite his praise for the restoration work done in sand mined areas of Fraser Island by Dillingham Murphyores and Queensland Titanium, will he assure the House that the Government has no intention of removing the ban on the export of sand mined products from Fraser Island?

Mr GROOM:
Minister Assisting the Minister for Employment and Industrial Relations · BRADDON, TASMANIA · LP

– As I mentioned in my answer to the question asked by the honourable member for Wide Bay, the advice that has been received from departmental officers who inspected the work done by the mining companies indicated that the rehabilitation work is progressing very satisfactorily. I think the companies concerned should be complimented for that work. The policy announced by the Government on Fraser Island is quite clear. I have nothing to add to that policy statement.

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QUESTION

EDUCATION: VIETNAMESE CHILDREN

Dr JENKINS:
SCULLIN, VICTORIA

– My question is addressed to the Minister for Immigration and Ethnic Affairs. Has the Minister’s attention been drawn to a report in the Melbourne Herald of Friday, 17 November, concerning a school for Vietnamese children in Altona? If so, is it a fact that the teachers had to purchase teaching materials at their expense? Is it also a fact that the teachers had to borrow furniture because the State Department of Education did not supply any? Is there a similar school in Blackburn where the teachers are forced to provide teaching materials at their expense? Is the Federal Government responsible for the payment of the teachers’ salaries? Is it also responsible for providing the furniture and teaching materials? If so, will the teachers be reimbursed for the expenses incurred by them in providing those materials?

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

– As far as I can recall, my attention has not been drawn to that article, except now by the honourable member. He has asked a series of detailed questions. I will certainly investigate them and give him a detailed reply after Question Time.

page 3273

QUESTION

UNIONS: BALANCE SHEETS

Mr CADMAN:
MITCHELL, NEW SOUTH WALES

– My question is addressed to the Prime Minister. Is it the Government’s intention to legislate for union balance sheets to be forwarded to union members? Is it a fact that previous governments have attempted to frame such legislation against great opposition? Will this Government do so?

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

– It is obviously very important that members of a trade union have a full report of the way their contributions and subscriptions to that union are spent. That clearly would give an insight into the management of the affairs of a union. It is perfectly appropriate and proper that members of a trade union be fully informed on their union’s affairs, especially its financial affairs. We have legislated in relation to this matter. As part of the amendments that have already been passed through the Parliament, union balance sheets and other financial statements are to be made available to members. At present, regulations to give effect to the amendments have not been finalised. They are currently under consideration by a Committee of the National Labour Consultative Council. I hope that its work will be completed very shortly and that this provision will become effective especially as I know that there is a considerable body of bipartisan non-political support for this move.

I have a letter written to Mr George Crawford, General Secretary of the Plumbers and Gasfitters Employees’ Union of Australia. I understand that there is no objection to the letter becoming public. Indeed, the last paragraph of the letter indicates a wish that the letter be published in full. One way of achieving that may be to have it incorporated in Hansard, if there is no objection, at a later point. In part, the letter states:

You will recall that apropos of nothing other than my greeting you, you burst into a tirade of abuse against me for allegedly amending the Conciliation and Arbitration Act to force you to post to all members of the Plumbers & Gasfitters Union a copy of their union’s balance sheet each year. That, as you ought to know, is demonstrably false!

I did nothing of the kind; but it is something I should have considered because as I reminded you whenever I found it possible to put in a word, your members have every right to see how you and your executive colleagues spend their money.

You responded by shouting: ‘My union’s balance sheets are properly audited’, and I replied: “Then that means you have nothing to hide’. I am still trying to work out what motivated you to flare up into such a state of wild excitement over the union ‘s balance sheets.

The letter continues:

Your attitude on the question of balance sheets caused me to tell you that the Plumbers and Gasfitters Union is not George Crawford. It is the thousands of rank and filers who constitute the membership of that union of very fine Australian Tradesmen. I repeat again: it is their union, not yours. You are their paid servant- you are not their master.

The letter refers to a royal commission report by Mr Justice Sweeney which made the point that the Act as at that date made no provision for the reporting of financial information to the membership. The letter continues:

He said that it was ‘highly desirable that the general membership be regularly acquainted with these details and able to express its views. ‘

I think that recommendation was contained in a report into certain activities of the Seamens Union of Australia. The letter continues:

So, before you hurl another mouthful of abuse at Mr Justice Sweeney or me, what about reading his report and getting your facts right on the nature of the amendments I put through the Parliament?

Let the unions run their own affairs ‘, you yelled. But in the context of our argument that could only mean that you want to prevent the rank and file from having the rights which the law now guarantees. I believe that the rank and file should have enforceable rights to effectively control their union’s policies and paid servants … I have never heard you object to the law giving your union monopoly rights to enrol plumbers and gasfitters. I have never heard you object to the law that permits you to prevent another union seeking award coverage for plumbers and gasfitters. Nor have I ever heard you complain against the law that permits the Commission to give preference of employment to plumbers and gasfitters who belong to your union.

I have never heard your objection to the law that prohibits victimisation against your union’s members. I have never heard you complain about the law that gives you right of entry to places employing plumbers and gasfitters. I have never heard you protest against the law that permits your union to sue an employer for breach of award and for wage arrears.

The letter then goes on a little later:

But if you don ‘t accept the sections of the Act that provide protection for a union ‘s membership -

Mr Young:

– How about incorporating the letter?

Mr MALCOLM FRASER:

– I do propose to ask that the letter be incorporated in full. The letter continues:

But if you don’t accept the sections of the Act that provide protection for a union ‘s membership against the possibly tyranny of their paid officials, and if you object to those laws which protect the ordinary plumber and gasfitter against rules that are ‘oppressive, unreasonable or unjust’, and which give him a legal right to force you to observe the union’s rules, then why don’t you try to persuade your members to allow your union’s registered rights to be taken over by some other organisation and try working outside the Act?

The correspondent indicates:

You did not like what I said about the rights of the rank and file and shouted something about democracy. But you were led away from my company before you could hear my reply and that is one of the reasons why I thought you might like to know what I would have said had you permitted me to share your company a moment longer.

I intended to say that if, in fact, your union rules now ensure full democracy, i.e. that right of every rank and filer to have a . . .

Mr Armitage:

– I rise to a point of order. I realise the Prime Minister is engaging in his pet practice of union bashing, but there is a reasonable time. He has been speaking for eight minutes of Question Time, reading from a paper.

Mr SPEAKER:

-The honourable member will resume his seat. There is no point of order.

Mr MALCOLM FRASER:

-The letter continues:

I intended to say that, if, in fact, your union rules now ensure full democracy, i.e., that right of every rank and filer to have a direct vote in the election for the position you now hold, then they have me to thank for it; because I amended the Act to make that requirement compulsory and you opposed those amendments.

The letter concludes:

It won’t surprise you to learn that I am not excessively impressed by your performance as a union official. I guess you will remember that when you told me that I know nothing about trade unionism I retorted that I knew more about the union movement than you would learn if you live for a hundred years.

I am quite certain that is right. He went on:

It is therefore with regret that I find myself forced to cut into my memoirs to pen this epistle. But, as the many listeners and observers of your behaviour would have noticed, the score of your rendition seems to make no allowance for any other voice but your own.

I now invite you to publish this letter to rank and file members of the Plumbers and Gasfitters Union because I believe they are entitled to have the benefit of my views as well as your own.

Mr Speaker, I am glad to note that there has been agreement that the full letter should be incorporated in Hansard. It is a very good letter. Could I suggest that special arrangements be made so that a copy of the relevant Hansard containing the letter is forwarded to every member of the Plumbers and Gasfitters Union because quite certainly they will not get it from Mr George Crawford? The letter was signed by a senior and most honourable member of this Parliament, Mr Clyde Cameron. I seek the leave of the House to incorporate the letter in Hansard.

Leave granted.

The document read as follows-

Commonwealth Parliament Offices AMP Building 1 King William Street Adelaide, SA5000 Tel 6 1.7400 2 October 1978

Mr G.Crawford, General Secretary, Plumbers & Gasfitters Employees’ Union of Australia, 52 Victoria Street, Carlton South 3053

Dear Mr Crawford,

At the reception to celebrate China’s National Day at the Canberra Rex Hotel last Thursday evening you distinguished yourself by becoming the only guest who could be heard above all others in that part of the room in which you and I were discussing, i.a. your union’s balance sheet.

You will recall that apropos of nothing other than my greeting you burst into a tirade of abuse against me for allegedly amending the Conciliation and Arbitration Act to force you to post to all members of the Plumbers & Gasfitters Union a copy of their union’s balance sheet each year. That, as you ought to know, is demonstrably false!

I did nothing of the kind; but it is something I should have considered because as I reminded you whenever I found it possible to put in a word, your members have every right to see how you and your executive colleagues spend their money.

You responded by shouting: ‘My union’s balance sheets are properly audited’, and 1 replied: ‘Then that means you have nothing to hide’. I am still trying to work out what motivated you to flare up into such a state of wild excitement over the union’s balance sheets.

After all, the various Companies’ Acts, which can’t be described as terribly radical, make it compulsory for every shareholder of a public company to be supplied through the post with a copy of the balance sheet. Don ‘t you regard your members as being shareholders of the union? I do!

You then abused me about the appointment of Mr Justice J. B. Sweeney as a Royal Commissioner to look into certain allegations concerning some seafaring unions.

May I again inform you that it was not I who appointed Mr Justice Sweeney as you allege? It was Mr Whitlam. However I fully endorsed what he did and fully endorsed what he said in his Press statement of 5 September 1974 when he commented:

The Australian Government agrees with the declared policy of the ACTU in condemning the demands and payments allegedly made. The Government is gravely concerned by the public declaration of officials of one of the unions alleged to be involved that the ACTU decision would be defied’.

Your attitude on the question of balance sheets caused me to tell you that the Plumbers and Gasfitters Union is not George Crawford. It is the thousands of rank and filers who constitute the membership of that union of very fine Australian Tradesmen. I repeat again: it is their union, not yours. You are their paid servant- you are not their master.

To help you with the facts, may I tell you that Mr Justice Sweeney did not present his final report to the Parliament until 25 May 1976? I ceased to be Minister for Labor and Immigration on 6 June 1975.

Mr Justice Sweeney made the point that the Act as of that date made no provision for the reporting of financial information to the membership. He said that it was ‘highly desirable that the general membership be regularly acquainted with these details and able to express its views’. He called for the reports to be presented promptly; but he did not recommend changes in the existing procedures of those unions which already made reasonable provisions to supply financial information to their membership and which permitted proper examination of that information prior to its adoption by the general meeting.

He even recommended that where unions used their official journals to publish the financial reports there was no need for any further publication. So, before you hurl another mouthful of abuse at Mr Justice Sweeney or me, what about reading his report and getting your facts right on the nature of the amendments I put through the Parliament?

Let the unions run their own affairs’, you yelled. But in the context of our argument that could only mean that you want to prevent the rank and file from having the rights which the law now guarantees. I believe that the rank and file should have enforceable rights to effectively control their unions’ policies and paid servants. So does the ALP and so do the Vh million workers who constitute the real trade union movement. As a political proposition I have always said that the anti-Labor Parties are welcome to the votes of those who want to leave the rank and file to the tender mercies of their paid officials.

I have never heard you object to the law giving your union monopoly rights to enrol plumbers and gasfitters. I have never heard you object to the law that permits you to prevent another union seeking award coverage for plumbers and gasfitters. Nor have I ever heard you complain against the law that permits the Commission to give preference of employment to plumbers and gasfitters who belong to the union.

I have never heard your objection to the law that prohibits victimisation against your union’s members. I have never heard you complain about the law that gives you right of entry to places employing plumbers and gasfitters. I have never heard you protest against the law that permits your union to sue an employer for breach of award and for wage arrears.

It was my amendment to the Act which now entitles you to recover wage arrears for up to six years- I have never heard you complain about that law. I have never heard you object to the law that gives you and your fellow officers the right to make, alter and rescind the rules and to have them registered and made binding upon your rank and file. I have never heard you object to the law that gives you the right to expel members who fail to observe those rules. And, I have never heard you object to the law giving you the right to sue your members for union fees and fines. But I could go on and on, for I have already listed 23 additional powers which go with registration under the Conciliation and Arbitration Act. All of these are essential and I support them; but they all represent interference by the law in the relationship between union officialdom and union membership.

But if you don’t accept the sections of the Act that provide protection for a union ‘s membership against the possible tyranny of their paid officials, and if you object to those laws which protect the ordinary plumber and gasfitter against rules that are ‘oppressive, unreasonable or unjust’, and which give him a legal right to force you to observe the union’s rules, then why don’t you try to persuade your members to allow your union’s registered rights to be taken over by some other organisation and try working outside the Act?

There is nothing, except commonsense, that stops you from doing that if you find it too tedious to supply your members with a balance sheet of their finances, or if you find participatory democracy too cumbersome for comfort.

You did not like what I said about the rights of the rank and file and shouted something about democracy. But you were led away from my company before you could hear my reply and that is one of the reasons why I thought you might like to know what I would have said had you permitted me to share your company a moment longer.

I intended to say that if, in fact, your union rules now ensure full democracy, i.e. that right of every rank and filer to have a direct vote in the election for the position you now hold, then they have me to thank for it; because I amended the Act to make that requirement compulsory and you opposed those amendments.

In fact, I still have the telegram I received from you on 8 May 1973, calling upon me to withdraw my amendments to the Act which required that all union officers exercising powers to make or alter rules, impose fines upon members, expel members or to exercise the functions of union management, must be elected by a direct vote of all of the union members likely to be affected by those decisions.

Tell me now, what is wrong with that? But your telegram informed me that my amendments were ‘Causing concern’ to your union and called for their withdrawal. The National Civic Council took the same line. Malcolm Fraser also supported the stand stated in your telegram and has obligingly amended the Act to repeal those democratic procedures which I put through the House of Representatives in 1 973.

In doing so, Malcolm Fraser had the full support of Mr B. A. Santamaria who, in ‘Point of View’ published in ‘News Weekly’, 26 May 1976, demanded that the Parliament should not be permitted to end its 1976 Autumn Session without deleting these amendments from the Act. He went on to defend the collegiate system for the election of union officials and condemned direct rank and file elections on the ground that they would ‘ultimately hand moderate unions over to the Communist-extreme-left coalition, behind the camouflage of an ALP ticket’. Supporters of the NCC were unanimous in their support of the Fraser-Santamaria axis on this question.

As a Labor Minister for Labour I was bound by my pledge to carry out the policy of the Australian Labor Party as set out in the Federal Platform. And, as a member of the Victorian Branch of the Party, so were you!

That Platform pledged that ‘Labor will also ensure a system of democratic control of all unions, allowing the fullest participation by members in their union affairs, a system of participatory democracy’. It went on to demand amendments to the Conciliation and Arbitration Act to provide that all members of a Union committee exercising any powers of management shall be elected by and made subject to the effective control of the membership’. And, ‘that no financial member shall be deprived of the right to vote in union elections’.

If my memory serves me correctly, you were a delegate to the Federal Conference which adopted the abovementioned policy. In fact, I think you were then President of the reconstructed Victorian Branch of the ALP; and as such it is not unreasonable to assume that you might have glanced at the Parry’s Platform on Industrial Relations. If not, you should have done so. Moreover, you should have felt the same obligation as I did to defend it.

But to return to your telegram: let me assert at once that you were not speaking for the rank and file of the Plumbers and Gasfitters Union when you sent me that telegram. You were speaking for yourself. But, as I reminded you on Thursday evening, you are not the union. You are its paid servant and the views you expressed in that telegram were not endorsed by the membership as you were to subsequently discover.

I know that you did not consult the membership before sending me that telegram because I received widespread support from the rank and file unionists, for what I did to return the Plumbers and Gasfitters Union to its members. Your members wanted the right to have a direct vote on the election of their General Secretary- a right which you said would cause ‘concern’ to ‘this union’, meaning you.

It won’t surprise you to learn that I am not excessively impressed by your performance as a union official. I guess you will remember that when you told me that I know nothing about trade unionism I retorted that I knew more about the union movement than you would learn if you lived for a hundred years. I also expressed the view that your own performance as a union administrator compared most unfavourably with my own. That made you shout even louder, but it still left me unconvinced that my assessment of our two selves was wrong.

As I remarked in my reasoned accompaniment to your outburst, ‘abuse is no substitute for argument’. It is therefore with regret that I find myself forced to cut into my memoirs to pen this epistle. But, as the many listeners and observers of your behaviour would have noticed, the score of your rendition seemed to make no allowance for any other voice but your own.

I now invite you to publish this letter to rank and file members of the Plumbers and Gasfitters Union because I believe they are entitled to have the benefit of my views as well as your own.

Yours sincerely, (CLYDE P. CAMERON) MHR for Hindmarsh

Mr SPEAKER:

-Somebody else will have to make the arrangements for distribution to members of the Plumbers and Gasfitters Union.

page 3276

QUESTION

DISSOLUTION OF PARLIAMENT

Mr LIONEL BOWEN:
KINGSFORD-SMITH, NEW SOUTH WALES

-I direct my question without notice to the Prime Minister. I remind the right honourable gentleman that on 3 November 1977 I asked him whether he would table in this Parliament his request to the then Governor-General for an early dissolution and the Governor-General’s letter of acquiescence. At that time the right honourable gentleman said he would check on precedents. I point out that there are many precedents for the tabling of those dissolution reasons in earlier years, particularly the years 1975, 1974, 1951, 1931, 1929 and 1914. In view of that fact I now ask the right honourable gentleman- because there has been a lapse of 12 months- whether he will now table his letter to the former Governor-General and, in particular, whether he will table the former Governor-General’s letter of acquiescence setting out the reasons for the earlier dissolution.

Mr MALCOLM FRASER:
LP

– I regret that there has not been a reply given to the honourable gentleman over that period. I will pursue the matter forthwith.

page 3276

QUESTION

EUROPEAN ECONOMIC COMMUNITY

Mr DOBIE:
COOK, NEW SOUTH WALES

-Is the Minister for Primary Industry aware of an article which appeared in yesterday ‘s Australian Financial Review stating that the European Economic Community’s agricultural commissioner is expected to press for an across-the-board freeze on farm support prices for next year’s farm price review for that organisation? In view of the Deputy Prime Minister’s response to a question of this nature on 16

November regarding agricultural subsidies in the European Common Market and following the British Prime Minister’s recent statement regarding agricultural price support, can the Minister inform the House and Australian rural producers what are the chances of Australian farm produce gaining easier access to European markets in the foreseeable future?

Mr SINCLAIR:
NCP/NP

– One of the incredible aspects of the stance generally taken at the moment by the European Economic Community is that its own customers are the people who are paying so dearly. As the honourable member has just suggested, the particular bite comes when one looks at the way in which, for example, our traditional customers in the United Kingdom are called on to pay a price significantly higher than that for which subsidised European Community agricultural produce is sold in world markets. Indeed, only this morning in another article in the Australian Financial Review I noticed that Mr John Silkin, the United Kingdom Minister for Agriculture, Food and Fisheries remarked on the fact that the EEC has sold subsidised butter to the Soviet Union at a price of about 47.5 pence a pound compared with 60 pence a pound paid by British shoppers for the same product. Without wishing to disclose the price that has been received in the recent sale of Australian butter to the Soviet Union I think it is apparent that Australia’s ability to sell agricultural produce in Third World markets is seriously prejudiced by the maintenance of the very high subsidies on European produce that is applied through the Common Agricultural Policy. My colleagues the Deputy Prime Minister and the Minister for Special Trade Representations within the Multinational Trade Negotiations are very strongly pushing this perspective. One would only hope that the statements by the British Prime Minister and the British Minister for Agriculture, Food and Fisheries are registered by their colleagues within the European Community, for the price at present being paid by the European consumer is maintaining a generally inefficient and highly overpriced system of agriculture which unfortunately tends to react to the detriment of Australian primary producers and our whole nation. I commend the honourable gentleman for his sentiments and I hope that the efforts of the British Government will be successful.

page 3276

QUESTION

USE OF INTERNATIONAL FLIGHTS FOR DOMESTIC TRAVEL

Mr DAWKINS:
FREMANTLE, WESTERN AUSTRALIA

– Has the Minister for Transport seen reports that Qantas Airways Ltd has approached Trans-Australia Airlines and

Ansett Airlines of Australia with a proposal for the utilisation of the spare capacity of the Australian sector of international flights? Has the Minister noted that the proposal opens the way for greatly reduced fares between Sydney, Melbourne and Perth? As this proposal is in line with the recommendations of the recent review of domestic air transport policy, what action has the Minister taken to ensure the acceptance of this proposal?

Mr NIXON:
Minister for Transport · GIPPSLAND, VICTORIA · LP

-The honourable member may have noticed that in my second reading speech on the Air Navigation (Charges) Amendment Bill I mentioned that negotiations are presently under way with the two domestic airlinesAnsett Airlines of Australia and Trans-Australia Airlines- on the outcome of the domestic aviation review. The point the honourable member raises is part of that review and is presently under negotiation with the two airlines.

page 3277

QUESTION

PUBLIC SERVICE: VOLUNTARY EARLY RETIREMENT

Mr HASLEM:

– I direct a question to the Minister assisting the Prime Minister in Public Service matters. He will be aware that school leavers will be coming onto the labour market over the next two months. Will the Government consider opening up job opportunities for young people as well as widening job opportunities generally by reintroducing legislation to provide for voluntary early retirement of Commonwealth government staff?

Mr VINER:
Minister Assisting the Prime Minister · STIRLING, WESTERN AUSTRALIA · LP

– I am pleased to receive the question from the honourable member. I know his interest in the position of school leavers coming onto the job market as well as the position of public servants. He has spoken to me before concerning the intentions of the Government with regard to the voluntary early retirement and redeployment Bill which was introduced into the House in 1976.

The Government has considered this matter in the light of discussions that have been held between the Public Service Board and the staff organisations. It has decided to proceed with the legislation which was introduced in 1 976. It is the Government’s intention to introduce that legislation again in the early part of the autumn session. The Government will be taking into account the discussions that have taken place, as I have said, between the Board and staff organisations. Amendments will be made to the Bill which was introduced in 1 976.

I remind the House that the legislation is aimed to do two things. Firstly, it will provide an option to employees of voluntary early retirement from the age of 55 with accordingly reduced superannuation benefits. Secondly, it will also provide for the Board or management to initiate early retirement in situations where redeployment is impracticable. But I do emphasise that specific appeal rights will be provided to individuals so that they cannot be adversely affected. The honourable gentleman particularly made mention of the prospect of school leavers being provided with job opportunities as a result of this action. I am sure that there will be increased job opportunities as the vacancies flow down the line from early retirement in particular. It is well known that many long-serving public servants desire to take advantage of legislation of this kind. They feel that they have served the country well and they want to make way for younger people.

Mr SPEAKER:

-I ask the Minister to bring his answer to a conclusion.

Mr VINER:

– This will be an important initiative by the Government within the Public Service in the area of creation of job opportunities. I mention one other aspect, Mr Speaker, to clarify the Government’s position. In the first place, this legislation will apply to the Public Service. There will be power to make regulations to extend it to other government employment.

page 3277

QUESTION

INDONESIAN TAKEOVER OF EAST TIMOR

Mr FRY:

– My question is directed to the Minister for Foreign Affairs. I refer the Minister to the continuing delay in arrangements for the reunification of Timorese families in Australia. I ask the Minister: Is the de jure recognition of the Indonesian takeover of Portuguese East Timor a precondition for the finalisation of these arrangements? If not, what is the cause of the delay? I also ask: Is de jure recognition also a precondition of the finalisation of the sea bed boundary between Australia and Indonesia in the Timor Sea?

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

-The person primarily responsible for family reunion, as the honourable member knows, is the Minister for Immigration and Ethnic Affairs. We are pressing on in regard to family reunions. I expect to discuss that matter and the question of the closing of any boundaries when the Indonesian Foreign Minister comes here. The question of seabed boundaries- there is a gap so far as Timor is concerned- is all tied in with the boundary negotiations that we will be having in due course in a variety of areas. As the honourable member knows, we have negotiated in the area from the Arafura Sea right through to the Coral Sea, not just on Torres Strait. We will have negotiations with the Solomon Islands and the French over their territories et cetera and so, too, we will be negotiating with the Indonesians on 200-mile zones as well as the closing of the gap-

I will not go into questions of recognition. The Government’s policy as I answer this question is as I enunciated it in January- namely, de facto recognition based on effective control of Timor by Indonesia. If there is a duty to negotiate in these areas I will proceed. The family reunion matter, as I said, is for the Minister for Immigration and Ethnic Affairs. I would not like it to be thought that by passing over the matter one is not concerned about the humanitarian element. We have made commitments here and we will be looking forward to further progress in this matter when we discuss the full issue with the Foreign Minister next month.

page 3278

QUESTION

POSTAGE RATES FOR NEWSPAPERS

Mr IAN ROBINSON:
COWPER, NEW SOUTH WALES · NCP

-I direct a question to the Minister for Post and Telecommunications. I refer to the proposed increase in postage rates for category A publications, which include most newspapers. I ask: Is this increase scheduled for early 1979 and will it be of the order of 30 per cent to 40 per cent compared with present rates? In view of the grave consequences of this exorbitant increase on residents throughout country areas of Australia who rely on mail services for their local and national newspapers, will the Minister reconsider the matter with a view to having Australia Post review the proposed increase? I further ask that the serious disadvantage such an increase will impose on country residents be taken to heart by the Government and the Australian Postal Commission.

Mr STALEY:
LP

-The answer to the honourable member’s first two questions is: Yes. The increases are not insignificant. They relate roughly to the amount of inflation which has occurred since the last increases. I will discuss with the Chairman of Australia Post the matters raised by the honourable member and, indeed, by other honourable members.

page 3278

QUESTION

PUBLIC SECTOR BORROWING REQUIREMENTS

Mr HAYDEN:

– I ask a question of the Treasurer. Is it a fact that total public sector borrowing requirements this year will be a record amount of more than $5,300m? In the light of this borrowing, how does the Government propose to achieve and sustain any marked reduction in interest rates, as it promised? In particular, how does it propose to do this with money supply already ahead of target and with the danger of substantial capital outflow as overseas interest rates move against Australia?

Mr HOWARD:
LP

– This Government in the conduct of its economic policies has tried to create conditions where interest rates can fall. We will continue to pursue policies which are designed to create those conditions. The impact of increases in overseas interest rates on capital outflow or potential capital outflow to Australia is naturally a matter that the Government has under notice. I do not accept that what has happened to United Kingdom and United States interest rates is necessarily going to have an adverse effect on capital inflow into Australia. I point out to the Leader of the Opposition that, whereas the effect of those increases has been to alter the interest differential between domestic and overseas borrowing, he ought also to bear in mind that the inflation rate in the United States is higher than the inflation rate in Australia, with a tendency to increase. The same can be said about the inflation rate in the United Kingdom. If we are trying to assess the impact of those changes on capital flows in and out of Australia, we also ought to bear in mind -

Mr Hayden:

– Exchange rate movements also will be influential and they will be against us soon.

Mr HOWARD:

-Yes- we also ought to bear in mind the course of domestic policy in the countries that we are seeking to compare. The Leader of the Opposition mentioned the money supply target and indicated that so far it is running ahead of the Budget projection. It is not unusual for the money supply at various stages of the year to be running ahead. I remind the Leader of the Opposition that month after month in the last financial year commentators and members of the Opposition said that the monetary target was not going to be achieved because seasonally it was running ahead of the stated target; yet the reality of the matter was that the final result for 1977-78 was very much in line with what was predicted in my predecessor’s Budget in 1977.

page 3278

QUESTION

MINISTER FOR DEFENCE: BIRTHDAY

Mr HODGMAN:
DENISON, TASMANIA

-My question is directed to the Minister for Defence. I notice in a publication entitled Pickering’s Playmates that today is the Minister’s birthday. Does the enhanced new look of the Minister for Defence as advertised in the 1979 Pickering calendar herald a new era for the defence forces? Can they, as shown by the example set by the Minister, expect newer, bigger and better equipment?

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

– My attention was drawn to this publication. When I first saw it I thought that all my birthdays had come at once. I was greatly impressed and enormously flattered. I thought that it was quite the kindest thing that had happened to me in the whole of 1 978. There is an observation made by Chaerephon in Plato’s Char.mides to this effect on seeing the undraped male figure, ‘my, it makes one forget the face’. I have to be honest about it and acknowledge the fact that it was my face. As for the equipment, I must say- in envy, mark you- that I suspect that in radically refurbished form the equipment belongs to the honourable member for Robertson.

Mr Cohen:

- Mr Speaker, I have been misrepresented grievously. I ask for a withdrawal.

Mr Malcolm Fraser:

– I ask that further questions be placed on the Notice Paper. With your indulgence, Mr Speaker, may I say also that the honourable gentleman who asked for a withdrawal knows perfectly well that it is within his own capacity to demonstrate whether or not he was misrepresented.

Mr Cohen:

– I want to say ‘thank you’ to the Prime Minister and the Minister for Defence. I am going to have the best year I have had in my life.

page 3279

REPORT OF THE AUDITOR-GENERAL

Mr SPEAKER:

-I present, pursuant to statute, the supplementary report of the Auditor-General for the year ended 30 June 1978.

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

  1. That this House, in accordance with the provisions of the Parliamentary Papers Act 1908, authorises the publication of the supplementary report of the Auditor-General for the year ended 30 June 1 97S.
  2. That the paper be printed.

page 3279

NEW AND PERMANENT PARLIAMENT HOUSE

Mr SPEAKER:

-I present the following report of the Joint Standing Committee on the New and Permanent Parliament House:

Report relating to the proposed erection of a viewing platform on Capital Hill.

Ordered that the report be printed.

page 3279

EXPORT FINANCE INSURANCE CORPORATION

Mr ANTHONY:
Minister for Trade and Resources · Richmond · NCP/NP

– Pursuant to section 88 of the Export Finance Insurance Corporation Act 1974 1 present the report of the operations of the Export Finance Insurance Corporation for the year ended 30 June 1978.

page 3279

PRIMARY INDUSTRY BANK

Mr HOWARD (BennelongTreasurer)Pursuant to section 10(2) of the Primary Industry Bank Act 1 977 1 present the first report on the operation of Part II of the Act dated 23 November 1978.

page 3279

JOINT COMMITTEE ON FOREIGN AFFAIRS AND DEFENCE

Mr KILLEN:
Minister for Defence · Moreton · LP

– For the information of honourable members I present the Government’s response to the report of the Parliamentary Joint Committee on Foreign Affairs and Defence relating to industrial support for defence needs and allied matters.

page 3279

DEFENCE FORCE

Mr KILLEN:
Minister for Defence · Moreton · LP

– pursuant to section 14 ( 1 ) of the Defence Forces Retirement Benefits Act 1948 I present the fifth supplement to the twenty-fifth report of the Defence Forces Retirement Benefits Board on the operation of the Act for the period 1 July 1972 to 30 September 1972, and pursuant to section 16(2) of the Defence Force Retirement and Death Benefits Act 1973 I present the sixth report of the Defence Force Retirement and Death Benefits Authority, dealing with the general administration and working of that Act and of the Defence Forces Retirement Benefits Act 1948 (other than Part III of the Act) for the year ended 30 June 1 978.

page 3279

CAPITAL HILL VIEWING PLATFORM

Mr VINER:
Minister for Aboriginal Affairs · Stirling · LP

– Pursuant to section 5 of the Parliament Act 1974 1 present a proposal for the erection of a viewing platform on Capital Hill. I intend to give notice of a motion seeking the approval of the House to the proposal under the terms of the Act.

page 3279

COMMONWEALTH LEGAL AID COMMISSION

Mr VINER:
Minister for Aboriginal Affairs · Stirling · LP

– Pursuant to section 33 of the Commonwealth Legal Aid Commission Act 1977 I present the report of the Commonwealth Legal Aid Commission for the period 22 March 1978 to 30 June 1978, together with the text of a statement by the Attorney-General (Senator Durack).

page 3280

ABORIGINAL HOSTELS LTD

Mr VINER:
Minister for Aboriginal Affairs · Stirling · LP

– For the information of honourable members I present the 1978 annual report of Aboriginal Hostels Ltd incorporating the audited accounts for the period ending 24 June 1 978.

page 3280

ANGLO-AUSTRALIAN TELESCOPE BOARD

Mr McLeay:
Minister for Construction · BOOTHBY, SOUTH AUSTRALIA · LP

– Pursuant to section 19 of the Anglo-Australian Telescope Agreement Act 1970, I present the report of the AngloAustralian Telescope Board for the year ended 30 June 1978, together with the text of a statement by the Minister for Science (Senator Webster) relating to this report.

page 3280

AUSTRALIAN CAPITAL TERRITORY

Mr ELLICOTT:
Minister for the Capital Territory · Wentworth · LP

– Pursuant to section 10 of the Seat of Government (Administration) Act 1930 1 present a statement of receipts and expenditure by the Commonwealth in the administration and development of the Australian Capital Territory for the year ended 30 June 1978.

page 3280

AUSTRALIAN WAR MEMORIAL

Mr ELLICOTT:
Minister for Home Affairs · Wentworth · LP

– Pursuant to section 23 of the Australian War Memorial Act 1962 1 present the report on the operations of the Board of Trustees of the Australian War Memorial for the year ended 30 June 1978.

page 3280

CONSUMER AFFAIRS ORDINANCE OF THE AUSTRALIAN CAPITAL TERRITORY

Mr ELLICOTT:
Minister for the Capital Territory · Wentworth · LP

– Pursuant to section 17 of the Consumer Affairs Ordinance of the Australian Capital Territory I present the report of the operations of the Australian Capital Territory Consumer Affairs Council and the Consumer Affairs Bureau for the year ended 30 June 1978.

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

That this House, in accordance with the provisions of the Parliamentary Papers Act 1908, authorises the publication of the report of the Australian Capital Territory Consumer Affairs Council and the Australian Capital Territory Consumer Affairs Bureau for the year 1977-78, and that the report be printed.

page 3280

AUSTRALIAN NATIONAL PARKS AND WILDLIFE SERVICE

Mr GROOM:
Minister for Environment, Housing and Community Development · Braddon · LP

– Pursuant to section 52 of the National Parks and Wildlife Conservation Act 1975 I present the report by the Director of the Australian National Parks and Wildlife Service on his operations for the year ended 30 June 1978. This document is a photocopy of the final report and has been circulated to all honourable members. The printed version will be circulated as soon as it becomes available.

page 3280

BILLS RETURNED FROM THE SENATE

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

Wheat Industry Stabilization Amendment Bill 1978.

Maternity Leave (Australian Government Employees) Amendment Bill 1978.

Superannuation Amendment Bill 1978.

Public Service Amendment Bill 1978.

Remuneration and Allowances Amendment Bill 1 978.

Income Tax Assessment Amendment Bill ( No. 3) 1978.

Income Tax Assessment Amendment Bill ( No. 4) 1978.

Income Tax (Non-Resident Companies) Bill 1978.

Income Tax (Companies and Superannuation Funds) Amendment Bill 1978.

Income Tax (Rates) Amendment Bill (No. 2) 1978.

Air Navigation (Charges) Amendment Bill 1978.

Life Insurance Amendment Bill 1978.

page 3280

SPECIAL ADJOURNMENT

Motion (by Mr Sinclair) agreed to:

That the House, at its rising, adjourn until tomorrow at 10 a.m.

page 3280

GRIEVANCE DEBATE

Industrial Safety and Health- Small Businesses Unemployment- The Fraser Government- Taxation- Drug Problem in Australia- The Parliament- New Postage Rate for Registered Publications- Capital Punishment- Human Rights in the Union of Soviet Socialist Republics

Question proposed:

That grievances be noted.

Mr HOWE:
Batman

-Earlier this week the Minister for Productivity (Mr Macphee), in his general statement on the work of the Department of Productivity referred to the whole matter of industrial health and safety. He said:

The need to improve our industrial safety and health record, particularly when it is realised that industrial accidents could well be costing Australia in the region of $2 billion each year . . .

I referred to this matter of industrial safety and health in a previous speech in May, when I outlined the dimensions of the problem as it exists in Australia; the difficulties of achieving action in this area, given the differing legislation of the various States; and the need for the development of a national approach to the whole matter of occupational and industrial safety and health. More recently in a speech I made during the adjournment debate I referred particularly to the problems associated with the development in Australia of what might be described as a multicultural work force. The fact is that the vast majority of people working in Australian industry were born overseas and many of them do not speak perfect English. They have problems which give rise to their being more highly represented in industrial accidents than is the community in general. I come back to that issue in my contribution to this grievance debate. I shall make several points and conclude with some proposals.

The key point I make is that in developing industrial safety and health policies in Australia we must constantly be aware that the work force is so diverse. Increasingly non-English speaking migrants form the basis of manufacturing and construction industries. It is such migrants, therefore, who are most exposed to risk in terms of industrial safety. Yet the current government health and safety codes barely acknowledge this fact. It is written as though the present Australian work force is homogeneous, monolingual and monocultural. The aims of this code are to involve all workers in their health and safety. This is commendable but, by not acknowledging the present multicultural reality of the Australian work force, such a code, if it is administered in its present form, is both foolish and irresponsible and ultimately a waste of money.

I refer in particular to a study carried out and completed earlier this year by the Centre for Urban Research and Action. That study was concerned with a large manufacturing industry. It is one of the top Australian companies which for a long time has relied on non-English speaking migrant workers. In the plant studied 87 per cent of the workers were migrants from nonAnglo Saxon countries. The work in that particular industry was hard, dirty and it was a manually labour intensive industry. Of the workers surveyed in the industry, 58 per cent had experienced loss of time through an accident. Most accidents- 57 per cent of them- occurred to persons in their first 12 months of work experience, and 44 per cent occurred to workers who had less than six months work experience. Employees with least experience tend to be most recently arrived migrants. Accidents occurred mostly to backs and shoulders, with leg and arm strains.

There was a wide range of lacerations, burns, eye injuries, and crushed hands and feet.

Proportionately more accidents happened on night shift than occurred on day shift. Proportionately more non-English speaking workers work on night shift than on day shift. Migrant workers also work in the most difficult work sections where they tend to have higher proportions of machine related accidents when compared with those of English speaking workers. NonEnglish speaking migrant workers who took part in this study felt that they were more alienated from their work than did Australian born workers. A high proportion of them- 80 per cent- stated that they disliked their work. They distrusted both management and unions and saw them as working in collusion to oppress them and to use their labour. They did not fully understand their machines, their induction or even the work systems. They intensely disliked the bonus systems- 71 per cent gave that indication- 65 per cent disliked shift work and 75 per cent disliked their supervisors. They stated that all these things upset their physical and home life and created problems of nervousness as well as the basic injuries to which I have been referring.

Many non-English speaking migrant workers- 39 per cent of those surveyed- were so frightened of management that they did not attend the medical centre for attention to cuts and other accidents because they claimed that they would lose money or even their jobs. Related to all this was the fact that only 16 per cent of the entire industry work force could read and speak English to any extent. Yet all communication and training was conducted entirely in English or by demonstration. Workers stated in the survey that they wanted better training, consultation with management and unions and to be involved in safety and health matters of their factories in their own languages. The strongest support for this came from most recently arrived migrants from Turkey, Lebanon and the Middle East.

These are only a few of the results of this research project, but they indicate the need for appropriate processes, structures and legislation that understand the nature and diversity of the Australian work force. The same report also provides comparative data from Western European countries, the United States of America, South Africa and the Arab region of the Organisation of Petroleum Exporting Countries in order to show how recently arrived migrants fulfil functions in those countries which are similar to those they fulfil in Australia, namely, to carry out the dirtiest, most difficult, most unpleasant jobs which are denned widely by the respective societies as being socially undesirable. Given this analysis and the fact that non-English speaking migrants are increasingly doing such socially undesirable jobs in Australia- that is, those jobs marked by low social status in one or more of the following traits: Work which is heavy, dirty, dangerous, monotonous, relatively poorly paid, and which has irregular working hours- I argue that it is increasingly important, in developing policies concerning the safety and health of workers, that this fact be made most explicit.

One would generally support the aims and hopes of the proposed code for occupational health and safety in Australian government employment, but one would hope that greater acknowledgment and emphasis would be given to the fact that the work force affected is diverse, multicultural and multilingual. If health and safety of such a diverse work force is to be improved, all workers must be involved with their unions and management. All persons and groups must be committed to, must understand and must be part of the process of achieving appropriate health and safety initiatives. Any changes imposed by one group on the others is doomed to failure. I think the Minister for Productivity recognised that fact in the speech he made earlier this week.

In line with this overall guiding principle the following specific steps should be taken: All communication, induction, and training must be multilingual; health and safety information must be passed on to workers in their own languages, preferably by means of multilingual communication discussion groups; more appropriate safety, induction and training sessions should be established for migrant workers; courses for supervisors are urgently required; and English language training on the job should be provided as a right to all non-English speaking workers, perhaps through a tax incentive scheme for employers, such as a social investment allowance. These courses should involve workers and bilingual educationists to enable the most relevant material to be used. Unions should be encouraged to contact non-English speaking migrant workers in their own languages about awards, rights and conditions, safety and health legislation and about how unions work. This would encourage participation and involvement. Management, unions and government departments should use migrant self-help agencies and involve such ethnic welfare and community agencies in the development of safety and health initiatives on the job. Unions and workers must have access to safety records, accident records, and work conditions. If all these initiatives could be encouraged we would have some hope of establishing a more appropriate occupational health and safety code.

If over a period of time we could develop such an occupational health and safety code which managed to encourage some commitment and involvement of the diverse array of persons and groups that make up Australian industry, it might be appropriate to work towards the development of a Commonwealth health and safety Act which would set the basic standards and processes that would be required for all Australian industry. Such an Act could be evolved on the basis of experience with the code in Australia and other countries. It could perhaps be introduced via the appropriate sections of the Constitution which deal with Federal powers. Perhaps the sections which deal with interstate trade or with foreign affairs could be used to implement the International Labour Organisation covenants. Inevitably, however, such an Act would depend on the support and co-operation of the States.

I think that the subject I have raised is an important one. It is one about which I think there is some recognition on the part of the Government that it should do something. I believe that the Government needs to go much further but, of course, one has to recognise, as it is recognised on this side of the House, that inevitable contradictions are built into the capitalist system. For example, there is a contradiction within the Minister’s own portfolio in that he emphasises the drive towards productivity, as if somehow that drive towards productivity will not involve the exploitation of the work force. In the post-war period Australian manufacturing industry has been built on the systematic exploitation of an imported working class. The problems to which I have referred are endemic to that capitalist system as it has been reflected in Australian postwar history. If Victorian resolutions mean that ultimately while that system remains -

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

Mr DONALD CAMERON:
FADDEN, QUEENSLAND · LP

– I realise that what I am about to say in this grievance debate is perhaps more appropriately a matter for consideration by governments at local and State government level. However, I believe that a sufficiently serious situation arises in our community to justify my raising the matter in this place. Besides, we have also recently seen

Federal Government intervention on the question of petrol pricing where the Minister for Business and Consumer Affairs (Mr Fife) has foreshadowed intentions in relation to the Government endeavouring to protect the retailer from the large oil company combines. Furthermore, there is another example of Federal Government intervention and protection of business in the form of the existence of the Foreign Investment Review Board which is designed to protect local industry from foreign takeover.

The subject which I intend raising is a more recent development in our community, that is, the creation of these huge drive-in shopping centres throughout various areas of Australia. My electorate is a growth area. The electorate of Fadden would probably be the fastest growing area in Australia. Therefore it is natural that if people have a keen eye for business they would be looking towards the area which I am privileged to represent in this Parliament. My attention has been drawn to the fact that there will be approximately 10 of these huge shopping complexes within a small radius in my electorate by the end of 1979. 1 am referring to something which creates problems for me insomuch as I believe in the private enterprise system and, as far as competition is concerned, I also believe that the market establishes balances. But I find it difficult to accept that free enterprise should be allowed to work in such a way that it destroys so many others who have contributed so much over the years.

I believe that we are seeing a vast change take place in our society in that the traditional shop owner, store keeper or professional businessman who has his business in a suburb is being turned from a shop owner to a person who simply pays rent. Day after day we are seeing the closure and ruination of many established businesses as a result of the creation of these Taj Mahals across the country. Regrettably local governments, as are other levels of government, often are pressed for funds and see the creation of one of these complexes as a cheap way to solve some traffic problem in a particular area. Probably they often receive some other benefits which are unknown to others as a result of approving these sites.

I acknowledge that change is always about us and that nobody can stop what is often described, perhaps, incorrectly, as progress. I point out to the big combines, such as Woolworths Ltd, G. J. Coles and Co. Ltd, AMP Society and in Queensland the State Government Insurance Office, which has an involvement in this field and to all others, that they have an obligation to the rest of the community. Whilst they also have an obligation to those people who have invested in their companies, whether they be policy holders or shareholders, that does not give them licence to disregard the existence of other people. Many years ago we saw the expansion of retail outlets for oil companies at such a prolific rate that only a few years later we saw the results of those unwise earlier decisions. We are now seeing the proliferation of these huge complexes. Whilst I am not suggesting that we are reaching the stage of having a complex on every corner, as occurred with service stations, we are reaching a stage where one of these huge complexes is on almost every second corner.

Indeed my new office in the suburb of Sunnybank will be next to a K-Mart. Another huge shopping centre is diagonally across the road and at the moment a battle is going on for the establishment of a third complex. I recognise that these complexes can be beneficial to the public in terms of parking, prices and the conglomeration of assorted stores in one area. I concede all that. But what I do not concede is the justification given by the giants that state that they are creating employment. The only part of that suggestion that I will concede is that they are creating opportunities for the construction industry. Generally the long-term effect is that if 100 or 200 people start work in the new complex one can be fairly certain that at least 100 to 1 50 people away from that area will lose their jobs because shops will have to close.

There is a danger that the surburban business centre in the future will become simply a ghost centre. When one realises that many people in small business have invested all their savings and turned all their profits into giving themselves some security, it is rather strange that levels of government that really have a responsibility to those people should turn a blind eye to their being destroyed virtually overnight. I simply say that there is room for the new complexes and the stores of yesterday to work together. Both systems can work side by side. But for this to happen there will have to be some rationalisation and somewhere along the way someone will have to take decisions as to the number of these new complexes, whether it be local government, State government or those companies which are creating these huge complexes. They will have to get together and say: ‘You have gone into that area. Not only do we have to consider the fact that we have to be some distance away from you before another such complex will be viable, but also we have to consider that there are a lot of established businesses in that area. ‘

Finally, I will briefly make reference to another subject. A question was asked today by the honourable member for Robertson (Mr Cohen) about sandmining and restoration and we heard the reply from the Minister for Environment, Housing and Community Development (Mr Groom). I recently took time off to visit Stradbroke Island where sandmining companies have revegetated areas which have been mined.

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

Mr MORRIS:
Shortland

-My grievance today concerns the hypocrisy and double standards of the Fraser Government. On one hand it calls on the Australian community, State and local governments to exercise economic restraint. On the other, it engages in a program of squandering the taxpayers.’ money in the lavish indulgence of the whims and fantasies of the Prime Minister (Mr Malcolm Fraser) for high speed imported limousines and luxury jetliners for his constant safaris abroad. The latest seasonally adjusted figures put unemployment in this country at 422,000 persons, an increase of 34,000 since February this year, the month when the Prime Minister said that unemployment would begin to fall. The true level of unemployment in this country is in the vicinity of 650,000, much higher than the figures themselves show.

Mr Ellicott:

-Come on!

Mr MORRIS:

– The Minister at the table says Come on’. If he talks to people and moves around the community, he will find that the people who have dropped out of the work force are not the concern of this Government. It has a totally callous attitude towards the people who are out of work and the people in this community disadvantaged by the harshness and brutality of its policies. It is all very well for Ministers on their salaries to sit in luxury in Canberra and pontificate about the needs of the unemployed. The inflation rate is locked into 8 per cent. The Government is quite happy to think only about inflation and ignore the needs of the unemployed and the socially disadvantaged. Yet, in the three years of this Government the Prime Minister has found the money to make 12 international safaris. It was the Prime Minister in his policy speech in November 1975 who said that Australia did not need a tourist for a Prime Minister. I am sorry, Mr Deputy Speaker, we have one.

Let me refer to the $65,000 spent on hotel bills in New York last recess. Let us hope with all the sincerity of honourable members in this chamber that there be no repetition of the extravagance of the Prime Minister and his entourage during the approaching recess. Even the Australian newspaper, that well known advocate of the Government’s causes, was moved on 9 June 1978 to write an article headed ‘An extravagant touch’. It referred to the use of Concorde aircraft by 19 members of the Prime Minister’s entourage across the Atlantic. An additional $2,500 was spent to give those people the thrill of being able to say that they had travelled in a Concorde. There was the charter of personal jets for use by the Prime Minister abroad. I will not go into that long list. It is already on the record. It is no wonder that the Government has consistently refused to provide information on the cost of overseas travel for its Ministers. It is no wonder that it persists in hiding the true costs of those exercises among the estimates of the respective departments. After 18 months of questioning and probing we are still not sure of the extent of expenditure on overseas travel by the Government. On 26 August, the National Times was moved to write about an unpublicised Federal Cabinet decision that tightened the requirements for Government Ministers travelling abroad. The article stated:

We understand that the new measures were taken after a well-travelled Liberal minister approached Thai International Airlines to try to use his travel entitlements to take his wife with him on a trip of which only part was official business.

The Cabinet decision was to tighten the rules so that members seeking to use their air travel entitlements must make their bookings through the Australian airline, Qantas Airways Ltd. That is a responsible and proper decision. It is only proper that people travelling abroad at the taxpayers’ expense should use our nation’s own airline. I turn now to the other side of the coin, the set of double standards of this Government and the blitz being waged on low income earners by the Taxation Office at the behest of this Government. I mentioned last week three instances in my own electorate which were brought to my attention. A young unemployed girl trying to find work received a bill of over $50 from the Taxation Office. She wrote and asked for time to pay $5 a week from her unemployment benefit. The immediate response from the Taxation Office was: ‘You must pay forthwith. Your application is refused.’ There could be nothing more callous and brutal than that, one would think.

Mr Ellicott:

– You cannot blame the Minister for that. What nonsense. You cannot blame the Minister when a clerk sends out a letter.

Mr MORRIS:

– The Minister at the table said: What nonsense. ‘ I deplore the standards that he applies. The letter was sent out over the signature of Mr Gray, the Deputy Commissioner of Taxation in New South Wales. If the Minister is not responsible, it is time he did something about it. The honourable member for Wentworth should not bleat about him carrying out his instructions. The next case was that of a man who became sick. He was off work for six months. He found that he owed over $300 to the Taxation Office. Again, he offered to pay $5 a week from his sickness benefit. Again, the reply from the Taxation Office was ‘Payment forthwith’. The next case was that of an invalid pensioner in a similar situation. It was brought to my attention yesterday in correspondence from the Sydney area. This is an example of what the Government is about. The invalid pensioner, a retired employee of the Public Transport Commission in New South Wales, owed the Taxation Office just over $100. He sought time to pay and was told to pay forthwith. He had to borrow the money from a finance company. Those are the double standards that I am trying to point to in this debate.

How do we contrast those standards with the tax avoidance schemes being operated by the leaders of the Government parties through the use of family trusts? What a disgraceful set of standards. Those at the very top of this nation are taking advantage of tax avoidance and minimisation to reduce their proper responsibility to pay income tax. The sick, the unemployed and the aged in this country are forced to pay immediately. They have to go to a finance company to borrow the money. That indicates the absolute callousness and brutality of this Government. This is the Government which sought to abolish the funeral benefit, a paltry $20 given to the families of people who leave this life. It was given to help pay for their burial expenses. Can anyone think of a more immoral move than to rob families of that amount? The Budget went one step further. The Government tried to steal money from the pockets of children. It sought to put a means test on the children’s allowance. The public outcry against both those measures, led by the Opposition, forced the Government to backtrack.

However, the Government succeeded in reducing the maternity benefit, an allowance brought in in the 1940s. Its specific purpose was to help young Australian couples building a family to meet the initial impact on household expenditure when a child was born. The Government managed to cut back that allowance. Where will that money go? It will help to pay for the Boeing 707s and the high speed imported cars. The Government tried to take money from people when they leave this life. It tried to take money from them as children. Having failed in those moves, it is now taking money from people when they are born by reducing the maternity allowance. Where will all the money go? What is it being used for? I say to this House and the Prime Minister that in the name of decency the Government should abandon this mad proposal to spend $40m of the taxpayers’ money to buy two luxury long range 120-passenger Boeing 727 aircraft to take the Prime Minister and his entourage abroad. As he cannot find such aircraft, he has gone even further. He has tried to buy 149-passenger Boeing 707 aircraft. For heavens sake, where is the decency and the morality of this Government? What set of priorities does it have?

Mr Ellicott:

-Stick to the facts.

Mr MORRIS:

– They are the facts. The Minister is uninformed, as usual. To me and, I am sure, to the average man in the street this $40m program and the hunt around the world to buy these aircraft is a gross indecency and a gross abuse of taxpayers’ money. I ask the Government to abandon that proposal. I ask it also to abandon the proposal to purchase two imported high speed limousines designed in Israel and helped to be built by Fiat, Cadillac, Mercedes Benz and Rolls Royce. I am told that they are waterproof, soundproof, bulletproof, even smellproof. There is no justification for spending taxpayers’ money of the order required on those cars. If the Government wants more cars, it should buy Australian made cars. I am told by the media that the cars are the subject of a Dnotice. That is a gross impropriety and a misuse of the powers of a D-notice.

Mr Ellicott:

– Did you say shellproof or smellproof?

Mr MORRIS:

-I said smellproof. The Minister will probably need it. Those cars are the subject of a D-notice. That should not be the case. There is no need for that kind of lunacy in security measures in this country. I ask the Government to abandon both these proposals and to spend the money instead to help pensioners. If the Government purchases two 707 aircraft abroad they should be named ‘Pensioner One’ and ‘Pensioner Two’. At least there would be some identification of where the money had been taken from and the priorities of this Government in extravagantly spending money on luxury imported airliners for which there is no reasonable justification would be identified.

Mr BOURCHIER:
Bendigo

-Before raising the subject that I did wish to speak on in the grievance debate, I feel it only proper that some answer be given to the outburst by the member for Shortland (Mr Morris) who claims decency is one of his goals. I think we could well record a quip he made at the time of the bombing in Sydney which accurately describes his standards of decency. However, he mentioned the purchase of cars. It was his former Leader who purchased the car the Prime Minister (Mr Malcolm Fraser) is now driving, an imported Mercedes-Benz. It is the present Prime Minister who is purchasing an Australian made car, so he should get his facts right. The honourable member talks about travel and mentions the cost of a trip to America. Let me remind him of some of the extravagances of his former Leader when he was Prime Minister of this country. Without going into the many, many details which have been published before, I would mention one or two things.

Firstly, in the first S30 days of the Fraser Government the ministerial visits were 54 covering 584 days. With the Whitiam Government there were 71 visits covering 1,053 days. One of the highlights of the former Prime Minister’s visits was a 35-day trip to 13 countries in December 1974- January 1975 accompanied by 42 people. He would need two of the planes the Prime Minister is talking about buying to accommodate the troops he took with him. The cost of that trip alone was $495,000. We only needed the former Prime Minister to stay home for three trips and we would have been able to buy a whole fleet of planes for this country.

The matter I raise is of much more importance than the trivia that the honourable member for Shortland goes on with. It is the problem of drugs in this country. Recently in my area I became aware- as I am sure the whole country was made aware- of the tragic loss of a young boy who died through experimenting with drugs. I am not going into the details of his death because his parents have had enough sorrow over it. However, the point is that in this country today books on drugs can be purchased from various booksellers throughout the country. I have one here called The Basic Drug Manufacture: Easy to follow instructions for the synthesing of Mescaline, LSD, et cetera. It sets out step by step procedures whereby young people today can go into shops and purchase from chemists the readily available materials listed in this book to make these drugs. I am not going to speak about them or name these particular drugs.

The book also points out the steps that should be taken to obtain these chemicals without being discovered. It is encouraging the young in this country to go out and purchase such devastating materials. It is not so much the materials themselves in that form that has been devastating. By using the step by step program in the book young people can learn to make LSD and other such drugs. I did raise the matter with the Minister for Business and Consumer Affairs (Mr Fife) as a matter of urgency. I think the country should be doing everything possible to prevent such books coming into this country. I will not ask for this book to be included in Hansard because I think the less seen of it the better for everybody concerned. In his reply to my request the Minister pointed out that the Government in which he is a Minister has asked his Department to have a look at the situation. He raised the matter at a recent meeting of Federal and State Ministers responsible for drug matters and all expressed concern at the distribution of this type of material.

Each State agreed to examine closely the possibility of amending appropriate legislation. That was 1 1 July 1 978 and I do not recall having seen any legislation appropriately redrafted to overcome this problem. It is no good standing around the country bleating about the problemwhether it is State or Federal- facing young people today in the drug scene. We have to act. It is all right to have security people checking on the importation of drugs. I go along with that and they are doing a great job. In fact the news we read in the Press advising of the capture of people bringing drugs into the country is surely good news to every decent citizen, particularly concerned parents; but surely if this sort of thing can go on unchecked through the universities or wherever else these books are distributed- by being distributed I mean made available for sale- then I think as responsible members of Parliament, both in the Federal and in the State area, we should demand that such books are not allowed into this country. If any are printed in this country under licence they should be banned.

I would go further to say that anybody handling such books in a retail way should be made liable for a very heavy penalty. The people who sell this type of booklet freely on the bookstalls and advocate the making of drugs are just as culpable of causing the drug abuse in this country as anybody importing the other forms of drugs. Following the last election I was rather disgusted to read that a Tasmanian Labor senator advocated the legalisation of pot. An article in the Launceston Examiner in July 1978 said that a Tasmanian Labor senator supported the legalisation of marihuana. What sort of thinking is that when we are seeing an expansion of the drug problem in this country? There is talk about pot being taken used without any ill effects. That is a lot of nonsense. It is a first step down the trail to drug taking. In my opinion, anybody who supports this sort of thing has no right to be in Parliament. We should be standing here trying to stop drug growth in this country by whatever means a government is able to use.

I did not hear the comment of the honourable member trying to interject. I will not name him as I do not want to embarrass him. I hope he is not advocating anything other than support. Knowing the person concerned I am sure he would not be. I am sure he would be one of the many members on that side of the House agreeing about the drug problem in this country. I hope that he in his own party takes back to his own State where his party is in control of the State Government a note of what I am saying. He may have a copy of the booklet to take back and to ask the State Government to take action. We do not want to see any headlines as we saw in the Melbourne Sun about the ‘Deadly Experiment’, with young school children playing around with experiments and ending up dead. Sad though that boy’s case is with the loss of a life, possibly it is better that it happened than he had gone along with an experiment where he would have ended up a total drug addict with no future. Every day we see the problems in this country relating to drugs. Any one who talks to the police forces will be advised of the number of arrests that are being made of people trafficking in drugs. It appears to me that we, as responsible people sent both to this Parliament and to State governments, have a moral duty to take whatever action is possible to make sure that the drug situation in Australia, if not totally wiped outwhich probably would be an impossible situation- should at least be curtailed as much as possible.

Let us face it, the penalties for drug trafficking are insufficient. Unless the governments instruct and ensure that the penalties for drug trafficking and drug usage are raised and the people who promote such filthy literature as this book are subject to a much greater penalty, I am afraid it is a waste of time just running around and expecting the police to apprehend them because as fast as these people are apprehended they pay the fine. You can read of people being caught weekly who will hand over $900,000 in cash to pay for drugs. Surely money is not the answer to stop these people. They should be locked up for a very long time. I hope the members on the opposite side do take some notice of what I am saying and will try to take some action in regard to their own State governments, as I intend to do in my State and in this Federal Government.

Dr BLEWETT:
Bonython

-Although I have devoted much of my adult life to a study of this institution, I had imposed upon myself a self-denying ordinance that I would not comment on the procedures of this House until I had some practical experience of them. Having now spent some 10 months in Parliament I would say a little about two of those procedures; firstly, Question Time and, secondly, the handling by this House of the Estimates for the year. Firstly, I think we would all agree that Question Time is extremely lopsided. It is a system which functions at the moment overwhelmingly in favour of the Executive as against the legislature. I do not want to put this in particular party terms because it seems to me that the lopsidedness disadvantages the total Parliament- perhaps particularly the Opposition- but indeed the whole Parliament. David Solomon wrote in relation to questions: the contest between those who ask the questions and those who answer them is most unevenly weighted in favour of those on the receiving end of the question.

I simply remind those honourable members on the Government side whose horizons are narrowly partisan, who welcome this lopsidedness because at the moment it favours their parties, that governments are peculiarly ephemeral. Honourable members opposite might spend the coming two years considering the needs of the Opposition in relation to the question period. Basically I direct my appeal to all those who believe that we must restore the balance between the legislature and the Executive. It is the task of all who believe in some sort of effective parliamentary democracy. We need a commitment to the restoration of the authority of the Parliament. The concern here is not in any way to emasculate government but to make the Parliament once more a worthwhile institution.

I suggest three relatively minor amendments to Standing Orders which would do much to remove the lopsidedness of the question period: Firstly, there should be the right to ask relevant supplementary questions. A single question is an extremely soft-nosed torpedo. Without provision for supplementaries there is little opportunity to expose weak, evasive or inadequate answers from Ministers. A disciplined system of supplementaries would make Question Time a far more effective arena for this House. Secondly, there should be an insistence that ministerial answers be succinct. It is a requisite, and it is insisted on by the Speaker, that questions themselves be short. Equally, we need to insist that ministerial answers be succinct. An answer necessarily may have to be somewhat longer than the question. I recognise that. But there is no excuse for the present situation whereby, on a brief calculation, the period given to answers on average is five times as much as the period given to questions. Much of the verbiage is simply waffle and much of the ministerial answers is irrelevant waffle.

I did a cautious estimate of this week’s answers and questions which suggested that at least half the time- I think that is a fairly objective calculation- the answers were simply irrelevant to the questions asked by honourable members. As a House we should insist much more strongly on relevance in ministerial answers simply to increase for all of us- not just the Opposition- the value of Question Time.

Of course those who have followed my argument to date will recognise that it implies necessarily a more critical and independent role for the Speaker. I make no apology for this. One of the key ways of restoring the authority of this House is to turn the Speaker from a creature of party to an independent servant of the House. I mean no particular criticism of the Speaker by that remark. It is simply that we have given him an impossible task because we have tied him to a party yet expect him to be an adjudicator.

I turn now to my other point, that is, the Estimates. Much of the time of the House in September and October was devoted to desultory and dreary consideration of the details of the expenditure proposals of the Government. Are there any honourable members who would defend the futility of those proceedings? They were quite useless for effective consideration of the details of the Government’s financial proposals and as a means of interchange between Ministers and back benchers. Indeed, one former member of this House who has now fled to another chamber commented:

Probably realising the futility of the whole proceedings, many members do not seem to read the Estimates that are being debated and approved; they merely take the opportunity to make political points on policy issues.

Even when an honourable member reads the Estimates- that is if he can understand them given the somewhat obfuscatory way in which they are framed- the rewards are minimal. I take just two personal examples. I went to great length in relation to one of the Estimates debates on the problem of unemployment payments this year. Yet in reply there was not a single squeak out of the responsible Minister against the facts and figures produced. Again, I made some comments on the details of overseas aid and all I got was a neurotic burst from the Minister concerned that did not address itself to the gravamen of my charge. I am sure that every honourable member in this House could cite examples of that kind of experience during the Estimates debates.

This failure of the House to develop contemporary procedures for dealing with expenditure proposals of the Government contrasts sharply with the achievement of the Senate where appropriate machinery in the form of Estimates committees has been established. An assessment of these committees is stated approvingly by the Clerk of the Senate: the new system of examining the Estimates enabled Senators to probe and obtain far more information from Ministers and departmental officers than was possible under the former Committee of the Whole procedure.

Which we still pursue-

Senators for the first time had the opportunity to question the departmental specialists responsible for the carrying out of policies. Furthermore, the question and answer sessions provided unique opportunities for the officers themselves to communicate directly with Senators, to explain policies and aspirations, and to establish a closer relationship and understanding between Parliament and the Public Service.

Is it not extraordinary that the Senate should have machinery to probe and to obtain information on finance denied to the House of Representatives? Is it not extraordinary that the senators are provided with an opportunity, denied to most members of the House of Representatives, to question and to probe departmental specialists on the Estimates? The contrasts go even further. All honourable members are no doubt familiar with the explanatory notes on estimated expenditure issued by each Department. Those documents go by right to each member of the Senate. Members of the House of Representatives have to beg, borrow or steal them. They certainly do not get them by right in the way they are supplied to senators.

All these procedures diminish and impair the financial authority of this House. Yet under the Constitution it is the House of Representatives, not the Senate, which is given the primacy in financial matters- despite the diminution of that authority which occurred in 1975. Clearly under the Constitution the chief financial prerogatives lie with the Representatives, not the Senate. The consequence of this is that the Representatives, not the Senate, needs the most appropriate and contemporary machinery for dealing with financial matters. It is interesting that the Joint Committee on the Parliamentary Committee System recognised this. In its report it stated:

It is the constitutional responsibility of the House of Representatives to oversee financial matters. A corollary of this proposition is that the Senate need not retain its Estimates committees.

So far, so good. The Committee recognised the constitutional principle plus the implication of it. But at that stage sense and fortitude deserted that Committee. Listen to this as an example of the worst kind of evasion which then followed. The report stated:

Whilst the Committee acknowledges the general constitutional principle, it considers that the interests of economy and efficiency require the continuation of this established procedure of the Senate.

This was a triumph of expediency over constitutional principle.

If we are to arrest the erosion of the financial authority of this House and to provide in this House more effective ways of scrutinising the financial activities of the Executive we need to replace the present dreary, desultory and pointless Estimates debates with effective Estimates committees. Our constitutional purists might be horrified but given our numbers and the limited parliamentary and support services of the Australian Parliament and to avoid needless duplication in questioning it might well be worth considering joint parliamentary Estimates committees. Certainly if we are to arrest the decline of the authority of this House of the legislature, over financial matters, we seriously have to reconsider, and immediately, the procedures in this House for dealing with the Estimates.

Mr MacKENZIE:
Calare

-Before coming to the subject I wish to raise I must congratulate the honourable member for Bonython (Dr Blewett). I suggest that all honourable members who are listening to the broadcast in this House might take the trouble tomorrow to read what he said. In the short time available to me I wish to raise some concerns I have about new postage rates that are to be introduced from 1 January next year which apply to registered publications, particularly those in category A. These increased postage rates represent substantial rises. Honourable members will recall that the general standard postage rate was increased for the first time for a number of years this year, representing an 1 1 per cent increase. However, when we look at the situation in regard to registered periodicals, particularly category A, we find that the increases are much more substantial than that. They range from between 30 per cent to SO per cent. This applies to standard and nonstandard articles.

The categories that are hit hardest are those weight categories in which most newspapers face. It is this aspect that I wish to discuss today. The history of the concessional rates for registered publications, of course, is quite a long one. At the time that it was introduced it provided some concession for what were regarded as essential publications for people living in rural and remote areas. This subsidy has been an internal one since the Australian Postal Commission was formed. It has pointed out that the continued concession in that particular area creates a net loss to its operating costs of some $15m. The last report of Australia Post, stated that the Commission had made it clear that it intended to recover a greater proportion of this particular cost for the registered publications category. However, I must take issue with the Commission because it said that in the years ahead it would aim to close the gap by reducing somewhat, albeit gradually, the extent of the concessions. I find it hard to accept that a 50 per cent increase at the one time is a gradual measure to close the gap. It is important because the increase in postal rates affects not only remote areas but also a broader spectrum of the community. I would point out that many charitable voluntary organisations, religious associations, trade union organisations- a multiplicity of organisations- have been able to benefit from the subsidised postage rate. Maybe too many organisations have taken advantage of the subsidised postage rate and that may have created the problem. I suggest that the Commission look at this matter.

In certain weight categories there are also very substantial rises for small local newspapers. This does not affect the people in the cities anywhere near the same extent as it affects those in country areas. Most local newspapers in country areas provide a very essential service for that particular area, not only with local news but also with market reports, wheather reports and all sorts of local information which, of course, is not available through the major metropolitan dailies. Many of these newspapers are also in difficulties and have had to increase their prices to a figure which, in many cases, is well beyond that of the metropolitan dailies. We now see a situation where a small, say a 12-page tabloid rural newspaper, will cost some 30c to 35c at the point of delivery by mail. That, of course, is the increased postage rate plus the subscription rate. I am more concerned, however, about the people who reside in the very remote areas of Australia and who we seem to forget so often in our urbanised country.

Mr Innes:

– Don’t forget the pensioners around the city areas.

Mr MacKENZIE:

– I was even going to mention, for the honourable member, the migrant publications that are very important and which come within this category. I am sure he would be very concerned on that basis. The people who live in the very remote areas of Australia are suffering extreme disabilities, certainly not so much in my electorate but in electorates in Western Australia and north Queensland where they have no television, virtually no radio, very few roads, very poor health services and they are endeavouring to teach their children by correspondence. Now, on top of all that, we find that their only means of really communicating with the rest of Australia- through their mailed newspapers- will cost more. They will now suffer an increase of 42.9 per cent in postal rates.

I cannot fully accept the arguments put by Australia Post. I believe that there certainly needs to be some closing of that gap. But if we are going to apply the user pays principle as viciously as this then I believe there are many other areas in the operation of Australia Post where the user pays principle is not being applied. A very small increase in charges in other areas would obviate what I think is quite a severe discrimination against people who can least afford it. I suggest that Australia Post reconsider the position that it has taken. It may at least assure Australian postal users, particularly the people I have mentioned, that further increases will not be considered in the immediate future. Certainly, the increase of SO per cent is placing a severe cost burden on the people to whom I have referred. Furthermore, I find that other areasparticularly in the communications field- are affecting rural Australia.

I refer to telecommunications matters. Whilst I congratulate the Telecommunications Commission for announcing that it will be upgrading all manual exchanges within the next ten year at a cost of $300m, nevertheless, I still find that rural Australia is experiencing many disadvantages. I take a particular case which is parochial. I represent the towns that are contained within the Bathurst-Orange growth centre. We know that STD rate concessions right across the board will be applicable from 26 November. But we find, because of the arbitrary limits on radial distances, that the city of Bathurst will now have a 10 per cent concession applied to business calls whereas the city of Orange, 50 kilometres away, will not have this concession.

We now have the rather ludicrous situation where, if somebody were looking at the Bathurst-Orange growth centre as an area for decentralising, he would look at communication costs because they are in fact one of the largest cost factors in determining whether a company should decentralise. He will find that the cost of telephone calls from Bathurst to Sydney are 40 per cent cheaper than they are from Orange to Sydney. I think this is indicative of some of the inflexibility that we find in semi-government statutory authorities. I believe that telecommunications charges are one of the most serious disincentives to decentralisation in Australia. Rightly, the Telecommunications Commission claims that under its charter it has no responsibility specifically for decentralisation. I agree. But it also has within its charter a requirement, as does Australia Post, to take special notice of the needs and requirements of those people in Australia who live outside the major metropolitan areas.

I come now to another point concerning communications. I refer to the Australian Broadcasting Commission which is a sensitive issue at the moment. I find it rather ironic that when there are complaints about government cutbacks and certainly complaints about the staff elected Commissioner- we find that the Australian Broadcasting Commission Staff Association takes action against those people who are least concerned and who will be hurt the most. I refer to the threat by the Staff Association to reduce the rural services of the ABC. The rural services of the ABC, unlike most of its other services, provide a very necessary means of communication for people in rural Australia. It is not simply a matter of finding out what technical advice one can get for spraying crops; it is an essential matter of market reporting, weather reporting, meetings and matters such as grain silo opening hours. The ABC provides a very necessary service. It is perplexing to me.

The reduction of staff is a matter with which I have some issue as far as the Government is concerned. Reductions of staff in country offices of the ABC affect the broadcasting capacity in those areas much more significantly than in city areas. Many ABC regional offices are operated by four or five people and a cutback of one or two staff within those offices can have disastrous effects. In conclusion, I place on record my concern about some of these matters which are affecting rural Australia, particularly remote Australia. I, for one, would be delighted if Australia Post could review its decision on the proposed increases in postal charges, particularly as they affect to those people who have no means of obtaining information, except from the newspapers through the mail.

Mr BARRY JONES:
LALOR, VICTORIA · ALP

-The Victorian Liberal Party at its State conference in

Melbourne last week took an instinctive lurch to the Right. It rejected the initiatives of the Gas and Fuel Corporation of Victoria in exploring for natural gas in Bass Strait and told it to sell its exploration interests to private enterprise. By a vote of 197 to 163 the conference also decided to repudiate its Premier Mr Hamer, the Deputy Premier, Mr Thompson, the Minister for Social Welfare, Mr Dixon, and call for the restoration of the death penalty. Four Liberal back benchers supported restoration of hanging. Their names, which will be unaccountably unfamiliar to honourable members, deserve to be recorded. They are: The Honourable Vernon Hauser, M.L.C.; Mr Bruce Skeggs, M.L.A.; Mr Robert Suggett, M.L.A.; and Mr Aurel Smith, M.L.A. It will be conceded that they are not exactly the people the Victorian Liberal Party is looking to for leadership in the 1980s. I commend the Speaker, Sir Billy Snedden, Messrs Lynch, Street and Staley and Senator Missen who opposed the death penalty resolution at that conference. Nevertheless, it is understandable that people should react instinctively towards atrocious crimes of violence. ‘Let us do something’, they seem to say, ‘anything, so long as it is decisive’. They presumably walked away from the conference having voted for death with a sense that something decisive had been done and that the problem of crime control had been solved.

Vengeance is the penal superstition of the Right just as rehabilitation is the penal superstition of the Left. In this extremely uncertain area neither has any demonstrated effectiveness. Punishment is a cherished part of the Australian way of life. It is a concept that Australians understand and warm to. The last remnant of the puritan ethic is the sense that everyone who goes to prison deserves to be there and that conditions ought to be tough, otherwise offenders will prefer the security and comfort of prison to the hazards of life outside. Most Australians, I suspect, have little faith that prisons can rehabilitate. This pessimism is realistic. They see retribution as the main element of our penal system. Their attitude is that if reform is unlikely, we should just keep prisoners out of the way.

Australia began as a convict settlement and penology was its primary industry for 50 years. Our penal birthstains and convict ancestry has not- the ‘mateship’ legend to the contrarygiven us much sympathy for prisoners. They are not seen as victims of society, but as outlaws, people who have declared war on the community. Ned Kelly, our most celebrated felon, is an exception who captured sympathy in odd areas of the bush and in some cities, but it is hard to add another convict name to our pantheon. There is a strong class element in all this.

Mr Lusher:

– What about Ben Hall?

Mr BARRY JONES:
LALOR, VICTORIA · ALP

– Ben Hall is another exception, from the electorate of the honourable member for Hume. Except for the small but growing area of middle class crime, such as fraud and embezzlement and some classless crimes, such as murder and serious motoring offences such as manslaughter, most crimes are committed by the poor. Jails are overwhelmingly filled by the poor, the illiterate and the disadvantaged. Aborigines are jailed out of all proportion to their numbers. The middle class alcoholic has the protection of friends and family. So does the middle class drug addict. They rarely find themselves in jail. Poor drunks are a significant group in our prisons. Most are isolated, alienated, friendless, remote from family or friends and socially defenceless. To have been jailed is a stigma of failure. To have slipped down society’s greasy pole makes it much harder to climb up again.

Prisons have a profound symbolic significance. They are closed and violent micro-societies conducted on behalf of and in the name of the large open society outside. But what are their aims? Do they succeed and how do we measure their effectiveness? It is easier to measure the effectiveness of other institutions. Some patients are carried out of hospitals but most walk out, demonstrably fitter than when they went in. We would be sceptical about hospitals if patients went in with one broken leg and came out with two, or if students entered a university with employable skills and emerged with no prospects at all. The best protection against crime in the long run is a society in which there is steady and unyielding pressure against every form of violence in a community which relies on reason rather than emotionalism and blind instinct. That is why we have much to learn from the succeess in crime control in countries such as Norway, Sweden, Denmark and the Netherlands, where from the earliest schooldays, children are taught to abhor violence. This is not to support the criminal interest as against that of the victim. I adopt the words of the great French Nobel Prize-winning novelist, Albert Camus, who said:

I stand as far as possible from that position of spineless pity in which our humanitarians take such pride, in which values and responsibilities change places, all crimes become equal, and innocence ultimately forfeits all rights.

We need to know far more about the causes of crime, and why patterns of criminal behaviour differ from suburb to suburb and from city to city. If a typhoid epidemic broke out in a particular area, we would know how to handle it, but in crime control we blunder about blindly. Boris Pasternak wrote in Dr Zhivago:

I think that if the beast who sleeps in man could be held down by threats- any kind of threat, whether of jail or retribution after death- then the highest emblem of man would be the lion tamer in the circus with his whip, not the prophet who sacrificed himself. But don’t you see, this is just the point- what has for centuries raised man above the beast is not the cudgel but an inward music; the irresistible power of warmest truth, the powerful attraction of its example.

Most Australian States retain huge, ugly, destructive, expensive multi-purpose central prisons such as Pentridge Prison in Victoria, Long Bay gaol in New South Wales and another one yet to be built, Boggo Road Gaol in Queensland, all of them monuments to futility. No one is proud of them. They are universities of crime, hospitals that infect patients, asylums that increase madness, warehouses of misery, that exist only to satisfy our collective folk myths or ignorance about crime and punishment.

I wish to talk about the death penalty itself. A reasonable man thinking calmly might well conclude that the death penalty ought to be a unique deterrent because it horrifies him. But examination of criminal statistics does not bear this out. There are some classic examples of how close familiarity with the death penalty does not seem to have had that unique deterrent effect. Sir Ernest Gowers found that, of 167 prisoners hanged in Bristol in the 19th century, 164 had witnessed one or more executions. The appropriately named Charles Justice, who invented the clamps for holding condemned prisoners in the electric chair, was himself electrocuted for murder.

Until 1939, when guillotinings were public in France, a majority of French murderers had observed one or more guillotinings. David Bennett, who was hanged at Pentridge Prison in 1932, was a lifelong friend of Angus Murray, who was hanged in 1924. Thomas John Ley, a former New South Wales Minister of Justicenot Labor of course- and an ardent retentionist was sentenced to death for murder in England in 1947. Harold Green who organised the petition for the hanging of the ‘Moors Murderers,’ Ian Brady and Myra Hindley, was soon after convicted of child murder. Sergeant William J. Mulrine III, a senior police officer who campaigned for the restoration of capital punishment in Delaware in 1951, murdered his wife 10 days after the death penalty was restored.

It is striking that with the much publicised political assassinations and attempted murders in the United States of America-for example, the murders of President John Kennedy, Senator Robert Kennedy, Dr Martin Luther King, Medgar Evans, James Meredith, and George Lincoln Rockwell and Malcolm X, and the attempted murders of President Truman and George Wallace- all without exception took place in States in which the death penalty applied, although all these men were highly mobile and in theory might just as well have been shot down in an abolitionist jurisdiction. But it does not happen. One might have expected that many murderers in the United States of America would have taken their victims over State lines into an abolitionist area to kill them, but they did not. For a unique penalty to deter uniquely it would need to be effectively publicised. Even supporters of capital punishment are squeamish about media coverage of current methods of execution. An inexpert hangman may bungle the long drop, and with lessening execution rates expert hangmen are hard to find. The electric chair causes convulsions, scorching and sparks which would look gruesome on colour television; the operation of gas chambers is protracted; the guillotine has never been popular in the English speaking world; the garotte has few supporters outside Spain; and the Australian Medical Association would be uneasy about lethal injections which may be in conflict with its members’ ethical codes.

The retentionist dilemma is that executions conducted in public or on television may maximise any deterrent effect of capital punishment while at the same time arousing revulsion among the non-committed. Abolitionists have always argued that capital punishment encourages a morbid fascination with murder, turns trials into gladiatorial contests, and invariably produces sympathy for even the most unprepossessing criminal. No one has been executed in Australia since February 1967. 1 do not believe, despite the breast beating we have seen from retentionists in the last few days, that there is anybody in a responsible place in Australian public life who believes that there will ever be another execution in Australia.

Mr DEPUTY SPEAKER (Mr MarthaOrder! The honourable member’s time has expired.

Mr HODGMAN:
Denison

-In recent months mankind right around the world has strongly and vociferously condemned the systematic persecution of civil rights dissidents in the Soviet Union. The mock trials of Orlov, Scharansky, Ginsberg and the Baltic dissident Petkus besmirched the name of justice in the eyes of all right-thinking men and women in all corners of the globe. It was no surprise that the strong voices of protest echoed from every conceivable sector of the political spectrum. In the United Kingdom and the United States voices of conservatism mingled with the loud cries of protest of every single Communist Party in Western Europe. There were spontaneous calls for the removal from Moscow of the 1980 Olympic Games. There were calls for the boycott of the 1980 Olympic Games unless the Russians were prepared to recognise and respect basic human rights. Australia’s Minister for Foreign Affairs (Mr Peacock), I believe to the pride of all Australians, was devastatingly trenchant in his denunciation of brutal violations of human rights by the Soviet state.

I believe it to be a matter of profound regret that 1 1 November 1978 will be remembered by many Australians as a day of national shame for this country. On Remembrance Day 1978 a small section of the Australian community but an influential section of the Australian community not only chose to forget those who are fighting for basic human rights in the Soviet Union, but they callously turned their backs on those freedom fighters in the Soviet Union, the modernday martyrs of 1978. On 11 November 1978 a motion was proposed at a political forum, and I read it:

  1. . deplores and condemns the actions of the Soviet Government, most recently demonstrated in the trial and conviction of Orlov and Ginsberg, in denying the rights and liberties of those of its citizens who wish to exercise their democratic rights of freedom of expression and peaceful dissent.

That motion repeated a decision made by the administrative committee of one of the two major political parties in the State of Victoria, but on Saturday, 11 November 1978, the procommunist left wing of the Victorian branch of the Australian Labor Party defeated that resolution by 142 votes to 130. What a day of shame for Australia when one of the two major political parties in the State of Victoria came out publicly and refused to condemn the Soviet Union for its treatment of civil rights dissidents.

Mr Bourchier:

– Were there any Federal members among that number?

Mr HODGMAN:

-There were indeed, and I will come to that. I believe that every person who has come to this country seeking freedom since World War II, from whatever nation of the world, will deplore and condemn, as will all right-thinking Australians, the disgraceful, cowardly, callous actions of the Victorian ALP in refusing to utter one squeak of protest. It is one of the most disgraceful backdowns and acts of appeasement since Munich. It is very significant to note the total silence of the Leader of the Opposition (Mr Hayden) in this Parliament, his total failure to condemn, his total failure to dissociate himself. What did the Press have to say about it? I will read from the Melbourne Sun on the Monday afterwards, Monday, 13 November, in an article headed ‘Surprise rebuff on Red rights’:

The State ALP surprisingly has refused to condemn the Soviet Government over its treatment of dissidents.

The State ALP administrative committee had decided in July it deplored and condemned the Soviet Government policy on dissidents.

The article goes on:

But the State ALP conference at the weekend decided against supporting the administrative committee’s decision. Conference voted by 1 42 votes to 1 30 to reject it.

Another report reveals that the vote was taken immediately after an address by the State President of the ALP, Mr Clyde Holding, the honourable member for Melbourne Ports. I would have thought that in opening the conference he would have drawn attention to motions that were coming up, motions that he would like delegates to consider carefully. I do not know whether the honourable member for Melbourne Ports emphasised the importance of standing up on the question of human rights and having the ALP adopt an honourable course and support the decision of its administrative commi ttee. It has also been drawn to my attention that the State Leader of the Opposition, Mr Wilkes, has remained silent on this matter. Are they so frightened of the pro-communist left within their own party that they are not prepared to stand up and condemn? I say that as long as the Victorian ALP continues to act in this way there will be no need for Soviet Russia to have an embassy in Australia. These fellows will do a far better job for them. I go on record as saying that one of your delegates -

Mr DEPUTY SPEAKER (Mr MartinaOrder! It being 12.45 p.m., in accordance with Standing Order 106 the debate is interrupted.

Question resolved in the affirmative.

page 3293

INTERNATIONAL AIR FARES

Discussion of Matter of Public Importance

Mr DEPUTY SPEAKER (Mr Martin:
BANKS, NEW SOUTH WALES

-Mr Speaker has received letters from the honourable member for Shortland (Mr Morris), the honourable member for Indi (Mr Ewen Cameron) and the honourable member for Denison (Mr Hodgman) proposing that definite matters of public importance be submitted to the House for discussion today. As required by Standing Order 107, Mr Speaker has selected one matter; that is, that proposed by the honourable member for Shortland, namely:

The Government’s failure to introduce lower international airfares.

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

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

Mr MORRIS:
Shortland

-The bungling incompetence and blatant political dishonesty of this Government is nowhere more evident than in its failure to introduce lower international air fares. After almost two years of public discussion and frustration at the Government’s efforts to reduce international air fares, not one person has been able to travel overseas at the lower air fares suggested by various proponents or promised by the Government. If from the outset the Government had been candid and honest with the Australian public in its deliberations on international air fares the Opposition believes that lower air fares could have been introduced sooner, the enormous public anxiety over international air fares could have been avoided, and the Australian tourist industry would not have been damaged by people deferring their travel plans. This up-in-the-air policy mess, as it was described recently by the Travel Trade magazine, has been created by the total inability of the Minister for Transport (Mr Nixon) to grasp the complexities of negotiations involved in reducing air fares, especially in relation to developing new bilateral agreements for international air travel. Added to that has been the alarming lack of frankness and constant and confusing changes of attitude by the Minister for Transport towards the new proposals.

On the second last day of sitting of this session we have yet to receive from the Minister a precise schedule of lower international air fares and a firm timetable for their introduction. Over the past 1 S months the Minister has pursued a course of deliberately misrepresenting proposals for reduced air fares. After actively encouraging Laker Airways to submit a proposal for the operation of services to Australia, the Minister reversed his stance and rejected the Laker application. I hold no brief for Laker, but by encouraging Laker Airways the Minister not only raised public expectation that substantial fare reductions were possible but he also raised expectations that they would be available soon. The sole achievement of the Government to date on air fares by overt action has been to order a raid on ACTU-Jetset Travel Service in an attempt to prevent some six million people having access to cheaper travel. The raid can be described only as one of blatant political discrimination. Let me quickly recall the Minister’s record in his attempts at reducing air fares. On 25 August 1977 he told the Parliament that he:

  1. . hoped Mr Laker would make a submission on cheaper air flights to and from Australia.

On 12 October 1977 on the AM program he told the interviewer, Geoff Duncan, whilst dismissing the need for a public review on aviation:

What the public will be able to evaluate is what conclusions the Government comes to and that’s the important thing.

Here again he was exhibiting a total disregard for public interest. Since then he has shown nothing but contempt for the mounting public concern about air fares. In the same interview, when asked if cheaper air fares might result, he responded:

I’m sure that there will be cheaper fares somewhere along the line, yes.

What a firm indication and statement from a Minister who knew what he was about and who knew what was involved! His reply was a further illustration of the priority that this Government has accorded the reduction of international air fares. The Minister confirmed his support for the Laker proposal when he told the House on 16 March this year:

Having had discussions with Mr Laker about his proposal, I have said publicly many times that I am greatly in sympathy with the suggestions he is making about low cost fares.

Can we discern when the Minister really expected that the new fares would be introduced? In an AM interview early this year he said that there would be changes in air fare structures before the middle of the year. Six days later, on 24 January, he told the AM reporter in London, Tim Clarke, that he could not put a timetable on cheaper international air fares. One month later the Sydney Morning Herald reported him as stating on his return from overseas:

Cheaper fares would become available within 5 to 6 months following the Report of the ICAPR-

That is, the International Civil Aviation Policy Review- due on 31 March.

By the middle of this year the Minister had shifted his ground again. On 23 June 1978 he told the Sydney Morning Herald that he hoped to announce a new policy by the end of June. Earlier he had said that he hoped that new fares would be available to travellers as a Christmas present. This was despite his advice to Australians on 9 June that they should not delay their travel plans and, if they proposed to travel in the next few months, they should go ahead and make their arrangements. On 16 June the Australian reported the Minister as saying that he was still hoping to introduce cheap air fares on the London route before Christmas. On 1 1 October 1978 in his statement to the House on the Government’s aviation policy he said that some of the new fare scales would operate early next year. We have heard similar statements from the Minister recently following the Government’s belated action to negotiate cheaper Pacific air fares.

The whole saga of the Minister’s handling of the issue has been episode after episode of conflicting statements and amazing ineptitude. Clearly, from the outset the Minister did not understand the complexities involved in the air fares issue, nor apparently did he take the trouble to apply himself to the task- that is, until about eight weeks ago. This is highlighted in two ways. When speaking on the AM program from London on 24 January 1978 and when questioned on the timetable for the introduction of cheaper fares he said- I quote from a transcript of the interview; we should remember that this was a statement by Australia’s Minister for Transport, who ought to know what he is talking about when abroad:

Well 31 March is the timetable for the report to come to me from the International Review Committee, government will need to consider that, there will need to be consultations with the British Government at this end-

Then these dramatic words were uttered- and perhaps other interested airlines and perhaps government . . .

It is incredible that the Australian Minister for Transport would go abroad to negotiate international air fares and not be clear about or understand what the processes were- that we might have to talk to other governments and to other airlines. These are not our charges; his own words which are documented make that charge. He ought to have known then that new bilateral arrangements would have to be entered into when Australia made any adjustments to its international civil aviation policy. Quite clearly he did not know what was involved. Governments initiate negotiations with other countries, not airlines. It is not strange that more recently the Minister has been saying: ‘We need more time to complete these negotiations’? These are the negotiations which last January he did not know would have to take place. The Minister’s ‘bareback riding’ approach to negotiations with other countries has presented Australia with foreign policy difficulties with member countries of the

Association of South East Asian Nations. Quite obviously last year and earlier this year when the Minister was talking about international air fares he did not have any grasp at all of the difficulties that arise in the ASEAN scene. I need to remind the House of a statement in relation to ASEAN made by the Foreign Minister (Mr Peacock) on 15 September, when he said:

Australia’s relationships and influence are being judged more directly by countries of the region in terms of our capacity to contribute to economic co-operation.

Clearly, the countries of the ASEAN group see air travel as another commodity in international trade. Clearly complex, delicate, sensitive negotiations and compromises have to be entered into with those nations. Maybe later in the debate the Minister will tell us just how far he has got. In our view, by that ‘bare-back riding’ approach, that blunderbuss approach, that ‘ride ‘em in and shoot ‘em down’ approach, the Government and the Minister have delayed the whole process. As every day passes the Minister’s promise of a Christmas present of cheap fares becomes more and more of an illusion. I was going to say that the Minister is like a Santa Claus without hair, but rather he is like a Santa Claus without a beard. Wanting to play Santa Claus is not good enough. He should be able to put before us a firm timetable and the precise fares before the House rises for the Christmas recess. However, only last month we saw in the Sydney Morning Herald a report of a statement by a spokesman for British Airways, who stated that there would be:

  1. . at least a six month delay before implementation of any new UK fares package had ‘stunted’ traffic with a drop in forward bookings and the airline unable to tap a potential market of 1 million Australians waiting to fly to London.

That appears to be the public view of British Airways of what kind of timetable is involved. As I said earlier, the Opposition believes that the cheaper air fares would have been available sooner if the Government had taken a responsible and frank approach in its handling of the issue; if the subject had been handled with more competence and with a greater sense of responsibility.

The proposed fare levels, as announced by the Minister so far, continue the Government’s deception on the issue. Prominence has been given to the off-peak fare without highlighting the fact that the off-peak fare, when it becomes available on an advance purchase basis, will be available for the smallest period of the travel year. On the United Kingdom route the off-peak fare will be available for only 90 days in the year and that 90 days will be during the European winter. On the Pacific route it will be available for 16 weeks, a minor segment of the year. I ask the Government to reconsider its proposals in the light of the following: People who travel at short noticepeople who have a sudden bereavement overseas, a sudden illness in the family, or some sort of sudden emergency- will be penalised under the fare schedules outlined in the Minister’s statement of 1 1 October.

I refer briefly to those details. Under the immediate purchase excursion fare people can buy a ticket and immediately leave for a minimum stay abroad of 21 days and a maximum stay of 270 days. As that schedule is to be abolished, people will have to pay instead the new economy fare of $1,450 return or $725 each way. That means that during the off-peak months of February, October and November people will have to pay $1,450 return, whereas presently they need pay $1,000. In that class of fare and in those circumstances, the jump is $450 on the return fare. In the shoulder months of January, March, August and September the jump in return fare will be $250. In the peak months of April, May, June and July the increase will be $150 on the return fare. Those proposals, if they are to stand, will impose hardship, particularly upon those three million Australians who were not born in this country and who have close family and emotional links abroad. I believe that we have a special responsibility to people to see that they are properly catered for.

The proposed fare regime also makes no provision for people who, because of illness or age, cannot undertake a long non-stop journey in an aircraft- people who, because of some kind of illness, cannot sit for 24 or 28 hours in an aircraft. Some consideration has to be given to those people as well. As I mentioned, there are also those people who have to travel at short notice and who are not within the group of three million people that I mentioned. Each of these matters needs to be considered. I ask the Minister to give some hope to the people in these categories. Because of the Government’s incompetence in its handling of this subject and because of its failure to introduce low air fares, the Australian public has been denied the benefits of cheaper overseas travel. Unnecessary anxiety has been caused and the tourist industry has been thrown into chaos by the substantial amount of travel that has been deferred.

Sitting suspended from 1 to 2.15 p.m.

Mr MORRIS:

-Prior to the suspension of the sitting I was referring to the Government’s failure to introduce lower international air fares. I had pointed out to the House that this was because of the Government’s incompetence and its bungling in the handling of the issue. Because of its failure to introduce lower air fares, the Australian public has been denied those benefits. The Australian public has been caused unnecessary frustration and anxiety and the tourist industry has been caused avoidable confusion and deferral of travel. In specific terms, the Minister for Transport is responsible for the sorry sequence of events that has occurred. It is understandable that he is now coming under criticism from people within government ranks. It is understandable that moves are being touted for his transfer from the transport portfolio and for his replacement by somebody who has a better undertanding and grasp of the complexities of the issues involved in aviation policy.

The Opposition sees it as the Government’s responsibility to set down clearly and categorically a time-table for the introduction of lower air fares before the House rises this week. It has a responsibility to inform the Parliament of its progress in negotiations with European and Asian countries and of developments on the Pacific front. Frankly, the Australian public is fed up with the promises made by the Minister for Transport. It is fed up with the fudging about lower international air fares. The Australian people want to see action and they want to enjoy the benefits that lower international air fares will bring to them and to Australia. It is not good enough for the Minister to present, as he did on 11 October, a catalogue of excuses as to why lower air fares are not available. He suggested that they may be available some time m the future. Because of that situation, the people of this country just do not trust this Government and they do not believe what the Minister says, particularly on the matter of international air fares. The Government is deserving of the strongest condemnation for its failure to make cheaper overseas air travel available to the Australian public.

Mr NIXON:
Minister for Transport · Gippsland · LP

– The poor effort put forward by the honourable member for Shortland (Mr Morris) today I think is best demonstrated by referring to the poor material that he used, namely, the snippets of gossip taken out of the hundreds of Press briefings that I have given over the period. The selective quotes he used just show the poor case that the honourable member could make out. He said that the people of Australia wanted to see some action taken in relation to cheaper air fares. I agree with that. But certainly they will not see action from the Labor Party or from the honourable member for Shortland because, in the Labor Party’s policy, platform, constitution and rules, the word ‘aviation’ does not appear once. There is no section dealing with aviation or airline policy in the Labor Party’s policy.

Mr Morris:

– You are telling a lie. You are lying to the Parliament.

Mr DEPUTY SPEAKER (Mr MillarOrder! I require that the honourable member for Shortland to withdraw that remark.

Mr Morris:

– The word does appear in the Labor Party’s policy. I withdraw the statement.

Mr NIXON:

– Let me read what does appear, now that we have settled that matter. All that I can find and all the Parliamentary Library can find is an extract from the 32nd National Conference in Perth 1 977-1 do not know whether this is out of date- under the heading ‘Research and Planning’. It reads:

Examine the effects of the existing airlines policy on passenger and freight carriage.

Therefore, the Australian people will not get any action out of the honourable member for Shortland or the Labor Party because in the whole period it has not brought forward any aviation policy at all, nor has it brought forward in specific terms a policy in relation to international aviation. All that the honourable member for Shortland has sought to do in raising this matter of public importance today is to try to associate the Labor Party in some cheap political way with what will be an effective change in air fare regime policy. It is not making its own efforts but is simply hanging on to the Government’s coat tails. The situation is as simple as that.

The International Civil Aviation Policy Review Committee report was tabled 1 1 October. The Government instituted the review late last year to seek total investigation and policy options. In tabling that report I said that the policy had not been clearly set down and discussed by this House for many years, despite significant changes in the manner of operation of international air services, their dramatic growth and a very radical shift in the pattern of demand. The Government was concerned that the travelling public have available the cheapest possible international air fares within the frame-work of regular scheduled services which meet other demands such as business travel and travel requiring immediate and reliable departure- in other words, meeting demands of all sections of the travelling public in a non-discriminatory fashion. The Government recognised the need to consider carefully the method by which to achieve a reduction in fares on all routes.

On 9 June this year I announced that a negotiating team would leave to hold discussion with British Government officials on ways and means of seeking cheap air fares on the Kangaroo route which is our most important international trunk route. It is important to recall that these discussions began long before my tabling the International Civil Aviation Policy Review report, and I believe this demonstrates clearly the sincerity and the urgency with which the Government regards the issue. In a public statement that day I said:

As I have explained on a great number of occasions during the last 12 months the Government is determined to achieve a regime of non-discriminatory cheaper air fares to and from this country.

I also said that day that negotiations would necessarily take time. They are complex and involve many countries along the route. Both we and the British Government recognise that arrangements between each other are interdependent on arrangements each of us has separately with other governments on the route. It is gratifying to note that British authorities found our proposals attractive in that they provided lower fares and met all consumer demands and maintained regular scheduled services.

I have already announced the Government’s proposed advance purchase excursion fares to London which are $568 return, low season; $870 return, shoulder, and $998 return, peak, from eastern Australia. There is the added benefit of exit from and entry to all five gateways, allowing for maximum utilisation by the Australian public. This meets a major concern of the Government that services should be spread over all gateways to benefit all member States of the Commonwealth. The British negotiations are going very well and I still hold confidently to my prediction that I will make an announcement before Christmas on future arrangements on this route. As part of our continuing negotiations an Australian team will hold more discussions in Britain tomorrow.

Consistent with our policy it is the Government’s intention to seek lower fares in and out of Australia to Frankfurt, Athens, Rome, Belgrade, Amsterdam and Paris. Again I emphasise that the seeking of these cheaper fares is our initiative. It is not a Labor Party initiative, nor is it a European one. It is important to recall in this context that when the current advanced purchase fare of $850 return to London was agreed early last year other European airlines flying into and out of Australia declined to introduce a similar fare structure. At that time they made their own commercial judgment and as a result the present lowest direct fare to London on Qantas Airways Ltd and British Airways is subsequently cheaper than present direct fares to other European destinations. Migrants would appreciate more than anybody else the need for regular scheduled services to other countries of origin rather than the uncertainty of a one class charter operation when they are faced with the need for a quick visit home or a visit to Australia by a relative or friend. The Government’s proposals will ensure that regular scheduled services are maintained.

In pursuit of our policy, discussions have already been held with Germany, Italy, Greece, Yugoslavia, France and the Netherlands, and a second round of discussions with some of these countries has either commenced or will commence shortly. We have strong evidence from the European governments that they are very interested in our policy objectives. Indeed generally the reaction has been very encouraging. We wish to maintain the present network of air services from Europe as far as possible to and from these countries, not only for the benefit of Australians who wish to holiday there and Europeans who wish to holiday here, but also because of the special needs of the migrant community and development of business relations. In all of our negotiations in Europe we have been mindful of these important matters. Again I anticipate being able to make appropriate announcements before Christmas.

Our policy objectives in Asia are exactly the same as those for the rest of the world. Since tabling the report on 1 1 October- it is now only 23 November- we have already held discussions with Indonesia, Thailand and Malaysia. A firm date has now been agreed by the Government in Singapore for talks in early December, and we are hopeful of having similar talks with the Philippines in the second week of December. All of the talks to date have been most encouraging and our proposals have been given a very cordial reception. There has, however, been only a first round of discussions, and each of the governments will need to assess their proposals and make detailed responses. I believe the Asian governments recognise the advantages of our policy of having fares between Australia and their countries as low as possible. It is in our mutual interests. Our policy is also important in that it respects the interests of developing countries. I would emphasise that stop over arrangements will be available for those Australians wishing to visit Asia en-route to Europe.

There have been consistent allegations that proposals we are putting forward to both European and Asian governments would deny visitors to and travellers from Australia the opportunity to take stop overs in Asia en-route. This is not the case. I have said consistently that there will be provision of stop overs in Asia. It is the Australian Government’s wish to ensure that this may be done by a combination of sector fares in a simple way that consumers can readily understand and in a way that they can determine themselves the cost of their travel proposals. Recognising that it may take time for fares between intermediate countries and counties in Europe to be decided the Government has also proposed that there should be retention of excursion fares at current levels as a transitional device to ensure that this very popular travel need is met. Slightly changed conditions may apply to the fare and of course its introduction is dependent upon the agreement of other governments. First indications are that such an arrangement will be acceptable to those governments.

Additionally I wish to emphasise that there will be arrangements negotiated for maintenance of flexible type first class and economy fares which allow the same travel flexibility as at present. Of course these fares will be priced higher than point to point fares and it will be a matter for the consumer to decide for himself or herself which is more appropriate to their needs. The aim is to develop fare packages which allow consumers to make choices and flexibility in thentravel arrangements and which are cost related. Obviously there will be a need for experimentation by carriers with fare types and the conditions that are attached to fares, but in making changes the Government would expect that its policy objectives of securing the satisfaction of the needs of all consumers, including those for whom price is the most important determinant, are met as fully as possible.

On 23 January this year, the Acting Minister for Transport, Mr Macphee, announced that the Government was seeking consultations with the United States on air fare arrangements. In February we held the first round of those discussions which dealt with cheaper air fares across the Pacific and the proposal at that time to introduce a second American carrier, Continental. The second major round of negotiations was due to resume in Washington on 28 August, but the United States called these talks off. It is true that Pan American filed on two occasions prior to this time a cheaper fare proposal, but this was rejected for two reasons: The limited seat availability of about 2S0 seats out of Australia per week at about $800 return; and a desire by Australia to resolve the question in its totality in public benefit in government to government talks.

These talks resumed in Canberra on 13 November on an informal basis. On 14 November I announced our proposals. They provided for a new low fare for one-third of the year of $450 return for advanced purchase tickets compared with the current year round APEX fare of $951. 1 also announced our proposals to seek the introduction of a shoulder fare of about $670 and a peak season fare of about $896 return. Both of these fares respectively will also cover one-third of the year. The details are yet to be confirmed and these fares are yet to be formally submitted to the appropriate authorities in both countries. I understand that Qantas filed its proposed fares, in line with my proposals, with the United States Civil Aeronautics Board yesterday. We have been given every indication that the filing will be treated as a matter of urgency. As I have said, and I repeat, I am confident that the new regime across the Pacific will apply from 1 February next year.

Cabinet has approved the entry of Continental subject to the formal acceptance of my proposed cheap fares package and successful negotiation of other important details. These matters will again be discussed when the talks resume in Canberra on 4 December. In this context it is important to note that agreement has been reached more quickly with American authorities than with the British for a simple and obvious reason, that is, that the end to end services operate on a much less complex basis between the United States and Australia over an ocean. Most nights now operate directly between Australia and United States territory, whereas along the Kangaroo route bilateral discussions are required with a great number of countries.

This Government is the first government to undertake a complete review of Australia’s international civil aviation policy for many years. A report of the review committee provides the House with detailed information on the operation of our overseas air services, information which in its scope has never previously been available to the House. I point out that the Labor Government was in power for three years but did nothing whatsoever about it. It made no effort at all to introduce a change of air fare regime. Nor has the honourable member for Shortland, the Opposition spokesman for transport matters in this House, done anything to produce an aviation policy at all, let alone a policy on cheaper air fares. It was this Government that realised the potential that existed for lower air fares into and out of Australia. It was this Government which established the review and it is this Government which is actively pursuing changed policy arrangements and changed arrangements with other countries which will allow both lower fares and the maintenance of scheduled services from gateway points throughout the Commonwealth. The Australian Labor Party Government did nothing.

Its most recent transport policy which was adopted at the ALP Perth Conference in 1977, prior to the last election, made absolutely no reference at all to aviation, let alone to international air policy or specifically a case for lowering air fares. The honourable member for Shortland has been reduced to inane carping and meaningless and vacuous calls for public examination and participation, presumably as the only way for him to be seen as taking an interest. The Opposition now alleges that there is substantial capacity for reduction in the level of international air fares. It was Government recognition of this that lead to our establishing the review. It was the Government which recognised the complexities and problems available. It was the Government that made available to this House, to the public, the work of the review committee- in two volumes of several hundred pages.

When announcing the review the Government emphasised the complexities that change involved. It emphasised the need for agreement by other countries. It recognised that change would have an impact on Australian relations with other States. It recognised that certain classes of consumers were being denied the opportunity to travel. It was cognisant of the tourist industry’s request that air fares to this country be loweredand it was cognisant of the fact that benefits from change must be available throughout the Commonwealth. The Opposition alleged that considerable public confusion has been caused by the Government’s failure to indicate the complexities involved. I am delighted that the honourable member for Shortland has finally realised there are complexities involved. To state the government was unaware of these, or has caused public confusion, belies the facts. From the time of announcement of the review that has been the underlying theme of all my public statements. I have emphasised the interdependence of satisfying different classes of demand of international air services. If there is value from this debate today it is to further underline to members and the public the fact that determination of international air fares involves the agreement of at least two governments, and usually more.

Mr DEPUTY SPEAKER (Mr MillarOrder! The Minister’s time has expired. The discussion is concluded.

page 3300

AUSTRALIA AND PAPUA NEW GUINEA

Ministerial Statement

Mr PEACOCK:
Minister for Foreign Affairs · Kooyong · LP

– by leave- Honourable members will be aware that at my meeting with the Papua New Guinea Minister for Foreign Affairs and Trade, Mr Ebia Olewale, in Daru on 2 November, we adopted, and agreed to submit to our respective governments, the text of the treaty that is to be concluded on maritime boundaries between our two countries and on other matters relating to the Torres Strait. I am now pleased to be able to inform honourable members that the treaty text which Mr Olewale and I adopted has been approved by both the Australian and Papua New Guinea Governments. I also inform honourable members that both Governments have agreed that the treaty will be signed in mid December at Papua New Guinea House in Sydney by the Prime Ministers and Foreign Ministers of Australia and Papua New Guinea.

The treaty is a long, complex and detailed document. It incorporates in formal treaty language, and with the necessary degree of precision, the principal basic elements which I had agreed with the Papua New Guinea Foreign Minister would be included in the Treaty. I informed honourable members of these elements in my statements to the Parliament on 1 1 and 25 May. The treaty settlement which has now been achieved is one which protects the interests of Australia and all Australian citizens, while being, at the same time, a fair and equitable settlement between Australia and Papua New Guinea. A fundamentally important part of the treaty is that all Australian islands remain Australian, and all Australian citizens remain Australian citizens.

I take this further opportunity of assuring honourable members that the Torres Strait Islanders, through their chairmen, have been fully consulted and have expressed their support of the Treaty settlement. Since the negotiations with Papua New Guinea were resumed earlier this year, there has been close and continuous consultation with the Government of Queensland and the Torres Strait Islander chairmen. My colleague, the Minister for Aboriginal Affairs (Mr Viner) held extensive consultations with the chairmen during visits to the Torres Strait in March and May. Since March, there have been three ministerial meetings with the Premier of Queensland and his ministerial colleagues, and many discussions between Commonwealth and State officials.

The Premier and I, accompanied by the Minister for Aboriginal Affairs and the Queensland Minister for Aboriginal and Island Affairs, held joint consultations with the chairmen and deputy chairmen of the Torres Strait Island communities on Yorke Island on 31 October. The Islander chairmen endorsed the Treaty unanimously. The Queensland Government has concurred in the terms of the Treaty.

The final negotiation of this Treaty, after years of patient negotiation between the Australian and Papua New Guinea Governments, is a most dramatic and important achievement. It reflects the sound basis of the relationship between the two countries and justifies the determination of the two Governments that this very complex issue could and would be resolved by direct negotiation between them. This has not been easy. We faced issues relating to sovereignty and sovereign rights and special legal and humanitarian problems which involved important national interests for each country.

The Treaty will establish clearly the division of sovereign rights over resources between Australia and Papua New Guinea in the whole area between them- from the Arafura Sea to the Coral Sea. All these matters have been resolved by a Treaty which is equitable and meets the interests of both parties. The Treaty will give practical effect to a number of developing principles of international law. This will be significant in the process of development and acceptance of those principles.

A most important aspect of the Treaty, and one to which Ministers of both governments have given deep personal attention, has been the need to provide for the special protection of the interests and the traditional way of life of the peoples of both countries who live in and adjacent to the Torres Strait. In this context, particular care has been directed to the preservation of the unique marine environment of the Strait. These most important objectives will be achieved by the establishment under the Treaty of a protected zone in the Torres Strait. The Government believes that the Treaty resolves all these problems in a way that sustains the interests of all Australians, snares fairly and justly the resources of the area and reconciles the claims of the peoples and governments of Australia and

Papua New Guinea on a permanent and equitable basis with justice for all concerned.

The team of officials who assisted me throughout these extensive and intricate negotiations was a major contributing factor to the successful conclusion of what has been a very complex exercise. Without the persistence, attention to detail and dedication of those officials, I would not have been able to reach this conclusion. I present the following paper

Australia and Papua New Guinea- Negotiations on Maritime Boundaries and on Other Matters Relating to Torres Strait- Ministerial Statement, 23 November 1978.

Motion (by Mr Groom) proposed:

That the House take note of the paper.

Mr LIONEL BOWEN:
Smith · Kingsford

– This is the third statement that the Minister for Foreign Affairs (Mr Peacock) has made this year in respect of these very important complex negotiations. The Opposition fully supports the thrust of what the Minister said particularly that part of his statement which stated:

The Treaty settlement which has now been achieved is one which protects the interests of Australia and of all Australian citizens, while being, at the same time, a fair and equitable settlement between Australia and Papua New Guinea.

This is an objective which the Opposition supports without any equivocation whatsoever. We are very appreciative of the help given through the good offices of the Minister by his own officers in briefing members of the Opposition which, of course, helped them come to an understanding of the complexity of the negotiations. We applaud those officers for their dedication and interest in the matter and for the fact that a number of questions has been answered.

However, some factors have come to the minds of members of the Parliament. Not the least of these is the concern of some of our colleagues in the Senate that they were not invited to attend any of the negotiations. A number of them represent Queensland. They feel that they should have been consulted. Questions will be asked either inside the Parliament or elsewhere as to the nature of the negotiations. There is great value in the fact that the Minister’s officers were able to meet some of the senators to indicate clearly some of the background to the situation.

We recognise the fact that these negotiations have been directed towards the demarcation of boundaries between a former colonial power and a former colonial territory. The decolonisation process was stimulated by the Labor Government. It is gratifying to see that that stimulation has come to fruition. The border affects the lives of people but in no way does it affect relationships between them which must be strengthened by the fact that treaties such as this can be negotiated.

The situation is complex. Problems will arise because of the number of people involved and the rights of those people. There are the questions of traditional fishing rights, seabed resources and territorial seas around islands. The human involvement in an area towards which we, as Australians, have a direct obligation is complex. By the same token, we must recognise that resources will be found and developed from time to time, not the least of which could be petroleum resources.

That leads us to wonder what the position will be in the context of the difficulty of these negotiations. We are well aware of the fact that there will be an embargo for 10 years before there is any suggestion of developing seabed resources. We can put at rest also the suggestion that the people of those islands will not have the protection of Australian citizenship. They will be Australian citizens. We welcome and recognise that fact. We are delighted to say that that is also recognised by our very good friend and neighbour, Papua New Guinea. There will be a criss cross of the utilisation of migratory fishing resources. The maintenance of traditional fishing habitats will be a complex matter. People will not be disturbed by the practicalities of the situation which has obtained for a number of years. The future will involve the normal commercialisation or what is euphemistically called progress. That, of course, is doubtful in respect of what it does to people. That progress may be applied to fishing resources. There need to be negotiations as to what sort of commercial fishing should be allowed.

The Minister said that there have, been discussions with the people on the Islands about the negotiations. We note that there was a meeting on 3 1 October. Some of my colleagues were concerned whether there was adequate preparation for those discussions. The officials advised us and we are pleased to put on record that, prior to the discussions taking place on 3 1 October, the documents concerned were made available. The islanders could have obtained independent advice as to their present and future rights and their entitlements in respect of future development of any resources. It is very significant that we place on record that that was worked out well in advance. It is understood that the normal traditional fishing rights will be preserved. That is the first priority. The people themselves will be accepted as Australian citizens.

In respect of the future situation, a very effective representation of people was needed at the meeting on 31 October. I am advised by the officials- I thank them for their advice- that representation of the Island people was adequate. I understand that there are 17 island communities each of which represents an island or part of an island. The island communities each elect a council consisting of a chairman, a deputy chairman and a councillor. In turn, the island communities come together in three groups known as the eastern, central and western groups. I am informed that at the meeting on Yorke Island on 31 October to which the Minister referred, 33 people were present to represent the Islanders. Those 33 people included the following: The chairman of each of the 17 island communities; the deputy chairman of each of the island community councils except in several cases where the councillor was present as acting deputy chairman and except in the case of Stephen Island- where there is no deputy chairman or councillor at present- and in the case of Badu where the deputy chairman stayed in Badu to prepare ceremonies for the visit by the Ministers concerned. I am also informed that Mr Getano Lui, chairman of the Yam Island community council was present also in his capacity as chairman of the Central Island Council. Mr Joey Nona was present as chairman of the Badu Council and as representative of the Western Islands group, and Mr George Mye was present as representative of the Eastern Islands group.

I make the point that there was adequate and very worthwhile representation because there is a suggestion that the people may not have been adequately represented. There is an inference that perhaps somebody else should have been there. I do not want to say that there is any support for that at all but there could be the suggestion that perhaps people in Queensland felt they should have been the subject of some acknowledgement as representing the Torres Islanders. From our point of view I would say that on the face of it, in light of that evidence, it was a very representative gathering. It is clear, arising from that, that there has to be a continuing process because it has got to deal not only with the Islanders’ rights as they now are and the maintenance of those rights as they must be maintained; there also has to be the future situation as to what problems may arise and how they are best dealt with. There could be no better way than having some form of advisory council, which the Minister has not adverted to in his statement, and which I think would be elementary from the point of view of what we are about; that that should be representative of the national Government and also particularly of the islanders.

We are not attracted- Mr Deputy Speaker, I hope you do not take personal umbrage at this- to the fact that the Queensland Government in our view is not noted for its ability to protect the rights of people. It makes the point at times that it proposes to intrude into the issues of what are people ‘s rights. I think it is very important when dealing with this on a national basis with another government, as we are, that if there is to be a question of future rights, that that be the subject of negotiations and discussionsconsultation certainly between both governments- but with the advice and consent of the people concerned. There could be no better way to enforce that than by having an advisory council representative in the main of the Islanders themselves, certainly the national Government, and I would hope that those two together would more than outnumber any Queensland representation. It is not good enough to have national rights protected by treaties, or the subject of negotiation by treaties, to be the subject of what we would say are some of the appalling decisions that have been made by Queensland Government officials in the past and at present. I make that point because it is not adverted to in the statement.

Subject to all those matters, the Opposition welcomes the fact that these negotiations have proceeded in a most amicable fashion. On the evidence submitted to us and in the light of the explanations given to my own senatorial colleagues there can be no objection to what the Minister has in mind. We make the point that we assume this meets also with the wishes of the Papua New Guinea Government. We are not aware of whether it is announcing today an agreement of the same fashion which the Minister has done but I assume it would do so. We note that the treaty itself would be concluded in the coming month. Having said those things and having adverted to the fact that we applaud the progress that has been made between our two governments, we hope that the future for the Torres Strait Islanders is a bright one in the sense that their future will be one of progress and that they will have the rights of determination which must be recognised and have not to the present been recognised.

Mr THOMSON:
Leichhardt

-As the member in this House representing the people of the Torres Straits, I was present during the visit of the Minister for Foreign Affairs (Mr Peacock) and the Premier of Queensland on 3 1 October and I was there when the consultations with the Island chairman and deputy chairman took place. I am quite satisfied in my own mind that they understood the details of the treaty and that they are satisfied with the treaty. They have been consulted at great length by Ministers and officials of both governments and I congratulate the Minister for Foreign Affairs and his officials who worked so very hard on this problem. Further, I congratulate the Foreign Minister and now Deputy Prime Minister of Papua New Guinea, the honourable Ebia Olewale, with whom I share an electoral boundary in this area for his foresight, patience and dedication to the national interests of his country in the reaching of this agreement; it could not have been easy for him. I believe he must have come under much the same pressures that I came under from the people of the area.

I congratulate the Deputy Leader of the Opposition (Mr Lionel Bowen) on his speech. It was a statesmanlike speech and I was delighted to see the bipartisan approach which the Opposition has adopted in this very important matter. However, I would take up the point he made about the support for the rights of the people by the Queensland Government. There is no doubt in my mind that the Premier of Queensland must take very great credit for the fact that a solution satisfactory to the people of the Torres Strait has been reached. If it had not been for him we may not have got quite so satisfactory a treaty. He insisted at all times that the rights of the people must be protected. This was not always easy for me, being rather the meat in the sandwich between the State and Federal governments, trying to represent the people. I place on record the splendid achievements of the Premier in this particular field. I look forward to the signing of the treaty next month.

I know the Islanders are to be represented by the three group chairmen and they will represent a people whom I believe are relieved that at long last their future and that of their children and grandchildren is secure. They are a splendid people with, I believe, a great future. They are strong and were of course very warlike characters. They have fought very hard with words- not weapons- for this solution. I congratulate the people of the Torres Strait for their understanding and patience. I thank the House.

Question resolved in the affirmative.

page 3303

REMUNERATION TRIBUNALS AMENDMENT BILL (No. 2) 1978

Bill received from the Senate, and read a first time.

Second Reading

Mr STREET:
Minister for Employment and Industrial Relations · Corangamite · LP

– I move:

This Bill gives effect to the Government’s decision to amend the provisions of the Remuneration Tribunals Act 1973 relating to the Academic Salaries Tribunal. The Act established the Remuneration Tribunal in 1973 and was amended in 1974 to establish the Academic Salaries Tribunal. Provision was made for the chairman of the former Tribunal to consitutute the latter Tribunal. Due to changed circumstances the link between the two tribunals, namely, the provision for the chairman of the Remuneration Tribunal to constitute the Academic Salaries Tribunal, is no longer appropriate. The Chairman of the Remuneration Tribunal, the honourable Mr Justice W. B. Campbell, has been elected Chancellor of the University of Queensland. As a result of this closer involvement with university affairs, he has indicated to the Government that he does not consider it appropriate for him to deal further with academic salary matters. To remedy this situation the Government has decided to make changes to the Act.

Clause 3 removes restrictions on the Chairman of the Remuneration Tribunal in respect of his association with tertiary academic institutions. These restrictions are no longer required because the Chairman of the Remuneration Tribunal will not in future constitute the Academic Salaries Tribunal. Clause 4 breaks the nexus between the tribunals. Concurrently with the above changes it was thought expedient to effect, through clause 4 of the Bill, some minor consequential changes to the Act. These consist of making provision for the term of office, the qualifications, resignation and dismissal of the person occupying the office of Academic Salaries Tribunal.

Incidental changes, contained in the Schedule to the Bill, are merely those designed to bring the Act up to date in the light of changed circumstances since the original Act was passed, such as the Independence of Papua New Guinea. Clause 6 is a ‘savings’ clause which provides for continuity between the former Academic Salaries Tribunal and that which will be appointed in the future, by ensuring that determinations made prior to these amendments to the Act shall be deemed to have effect on and after the date of commencement of this Act. I commend the Bill to the House.

Leave granted for debate to continue forthwith.

Mr LIONEL BOWEN:
Smith · Kingsford

– This matter has already been debated in the Senate. It is virtually a matter of formality which relates to the chairmanship of the Remuneration Tribunal. As the Minister for Employment and Industrial Relations (Mr Street) has explained, Mr Justice Campbell, who is the Chairman of the Remuneration Tribunal and the Academic Salaries Tribunal has now been elected chancellor of the University of Queensland. We can understand that in those circumstances he feels that it is not appropriate for him to deal with academic salaries matters. Accordingly we support the legislation.

By way of background, the Remuneration Tribunal was originally established by the then Labor Government so that one tribunal might be able to deal with all the salaries subject to determination including those of academics. At that time the academics felt- if I may use these words- that they should not be bracketed with members of parliament because that might affect their status and entitlements. We accepted that view and appointed members to the Academic Salaries Tribunal other than the Chairman. In other words the Chairman, Mr Justice Campbell, was a common denominator on both tribunals. We place on record our appreciation of the work His Honour has done during the whole period of time he has been on the tribunals and also our appreciation of the work done by the other members of the tribunals, particularly those relating to parliamentary entitlements.

We applaud them for their efforts. At the same time I think there is some reason to suggest that there has to be some uniformity in the appraisal and understanding of entitlements. One notices that appearing in legislation affecting Commonwealth employees. The Public Service has always been considered as some form of yardstick. The Government should also consider this principle in regard to the Academic Salaries Tribunal. I am adverting back to the fact that we had a common Chairman on the two tribunals so that there would be some understanding of the problems on the evidence submitted to the two tribunals in respect of matters which the public at large would think are ancillary to the determination of academic salaries. Having made the point and having indicated the background, we support the legislation.

Question resolved in the affirmative.

Bill read a second time.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr Street) read a third time.

page 3304

PUBLICATIONS COMMITTEE

Mr HODGES:
Petrie

-On behalf of the Publications Committee of the House of Representatives sitting in accordance with the Publications Committee of the Senate I present the report of the Committee entitled ‘Australian Government Publishing Service and its Role in Commonwealth Printing and Publishing 1964-1978’ together with the transcript of evidence.

Ordered that the report be printed.

Mr HODGES:

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

Leave granted.

Mr HODGES:

-This is the sixth special report presented to the Parliament by the Joint Committee on Publications since investigatory powers were conferred upon it by amendments to the Standing Orders in 1970. The inquiry into the Australian Government Publishing Service was initiated by the Committee since it felt that, after eight years of operation, it was timely for a review of AGPS activities to take place. The Australian Government Publishing Service was established on the recommendation of the Joint Select Committee on Parliamentary and Government Publications 1964- often referred to as the Erwin Committee after its Chairman, the Hon. Dudley Erwin. Since it was anticipated that future oversight of AGPS activities, functions and responsibilities would be undertaken by the Joint Committee on Publications, the Committee determined that it was the appropriate authority to carry out such a review. Initially, the Committee was content to examine AGPS operations only. However, as the inquiry progressed, it became apparent that there was a need to broaden its scope to cover the part played by departments, statutory authorities and other bodies associated with the Commonwealth’s responsibilities in printing and publishing.

The Role of Publications

The availability of published government material is an essential element to democracy as it exists in Australia. Good communication via the medium of print is necessary between the Government and the people: To enable the law of the land to be available to each citizen, to be read and understood; to enable the reasons behind government policy and its involvement in the life of each citizen to be publicised; and to provide to the electorate information on the Parliament and Government and their respective roles and activities.

The moves towards open government and freedom of information go hand in hand with the need to publish a greater volume of Commonwealth material. Honourable members are no doubt aware that the number of reports and other published material placed before the Parliament has increased considerably over recent years. Figures available to the Committee reveal that in 1964 the Commonwealth, through the Parliament, departments and statutory authorities published some 2,000 publications. Today AGPS alone publishes over 4,500 publications at an estimated value of $24m. There is little doubt that without the establishment of the AGPS, the Commonwealth would not have been equipped to carry out the huge publishing and distribution task facing it during the 1970s.

Australian Government Publishing Service Achievements

Since its establishment in 1970 the Australian Government Publishing Service primarily has been responsible for the huge improvement in style and production quality of Commonwealth publications. Any person who would care to examine a selection of Commonwealth publications produced in 1968 and compare them with their 1978 counterparts could not fail to be impressed by the design and production standard of the latter. In other instances, AGPS circulars have been responsible for restricting the more lavish departmental publications to an acceptable standard.

The AGPS has achieved a substantial improvement in the availability and distribution of Commonwealth publications to the public since the establishment of AGPS bookshops and the mail order service. AGPS sales of Commonwealth publications have gone from $441,000 in 1970-71 to almost $3m last financial year. The number of titles available through the AGPS has grown from minimal numbers prior to 1970, to 2,000 in 1973 and to 17,000 in 1978. The Committee can only conclude from these observations that the concept of the AGPS as originally proposed by the Erwin Committee in 1964 and eventually established by the Government in 1970 is basically sound and has led to vast improvement in the standard of Commonwealth publications and their availability to the public.

Administration

Initially in 1970, the AGPS was established as a semi-autonomous body comprising three branches- the Printing Branch or the Government Printing Office, the Publishing Branch, and the Management Services Branch. Since then, AGPS has undergone substantial administrative and structural variations until today when the Printing Branch and the Publishing Branch have been absorbed into the Department of Administrative Services. The Management Services Branch has been abolished and its functions carried out by the central Management Services Branch of the Department of Administrative Services.

The Committee is concerned to note that, by being a part of the Department of Administrative Services, AGPS as a service agent has been subject to extensive reductions in personnel through the lowering of staff ceilings. This has occurred to such an extent that many of its services have been reduced or are in the process of being decentralised to other departments. In the Committee’s opinion, the benefits to be achieved by the AGPS as a central publishing agency are under threat of being eroded to an unacceptable extent. If the AGPS is to provide an effective service which is capable of reacting to the needs of government and the publications market, it must be free to adjust its services and personnel to meet the current circumstances. Its present position within the Department of Administrative Services does not allow it this flexibility.

The Committee feels that this can only be achieved if the AGPS is re-established as a semiautonomous and commercially independent body and has recommended accordingly. To ensure that its costs of operation are acceptable, the Committee has recommended that the AGPS, within its autonomy, be established as a separate financial entity operating to a total trust account concept. In this way total services can be provided to client departments and the public on a user pays principle. The Committee is of the opinion that this approach will encourage client departments to be more responsible in their publishing programs, since they will have to pay a rate for AGPS services which is more in keeping with a commercial charge. So far as the AGPS is concerned, the provision of additional staff would have to be carefully weighed against its cost to the trust account. Wherever the employment of additional staff can be justified by increased sales or revenue, the Committee can see no reason why they should not be employed. The Committee feels that staff ceilings should not apply if the AGPS is able to operate without unduly draining Consolidated Revenue.

Consistent with its recommendations which seek to place AGPS operations more on a commercial footing, the Committee has recommended that an outside commercial publishing expert be appointed to act as controller of the AGPS for a limited contracted period. In addition, the Committee seeks to expand the activities of AGPS in the commercial field by recommending the establishment of more retail outlets in conjunction with commercial booksellers. To ensure the success of the expanded sales activities of the AGPS, its sales promotion campaigns must be drastically revised and improved.

Role of the Australian Government Publishing Service

Essentially the Committee has not recommended any major changes to the present role of the AGPS. Rather, it has attempted to firmly establish its existing role as the primary publisher of government publications. Wherever functions are performed by departments which could be more efficiently and economically carried out by centralising the function, the Committee has recommended that these be transferred from departments to the AGPS. In other areas, the Committee has recommended that AGPS adopt a more flexible attitude in the application of its guidelines, and return a degree of responsibility to departments. In a number of areas, the Committee is concerned to note that the existence of the AGPS has encouraged an abdication of responsibility by departments. Wherever possible the Committee has recommended steps to reverse this tendency.

The Government Printing Office

Throughout its inquiry, the Committee devoted a great deal of attention to the operations of the Government Printing Office. Currently the Government Printer has little control over the amount of work which passes through his factory, nor has he direct control over matters of staffing, industrial relations, and general financial and accounts administration. These are all the responsibility of either the Publishing Branch of the AGPS, or the Management Services Branch of the Department of Administrative Services. The Committee believes that the lack of administrative control by the Government Printer is a key element in the significant losses recorded by the Government Printing Office over recent years. For these reasons, the Committee has recommended that the Government Printing Office be removed from the AGPS structure and be established as a separate and self-contained unit. It sees the Government Printing Office running to a total trust account with full responsibility for its operations being vested in the Government Printer. The Committee has recommended that for administrative purposes, the Government Printer be directly responsible to the Secretary of the Department of Administrative Services.

The Role of the Government Printer

The role of the Government Printer has never clearly been established. The functions which his Office perform have accumulated gradually as a result of past practice. There are certain conflicts between these functions which should be clarified. For example his responsibility to the Parliament through its Presiding Officers for the production of Hansard, Notice Papers, Bills, et cetera, and his duties associated with the provision of printing services to the Government. While it has been understood that Parliamentary work shall always attract priority, such priorities have never been clearly established. The Committee has recommended that at the commencement of each session of Parliament a resolution be passed by both Houses of Parliament declaring the Government Printer’s responsibility to the Presiding Officers for the printing of all parliamentary publications; that he be provided with all necessary resources to meet this responsibility; and that at all times the Government Printer give priority to parliamentary work. In addition to these responsibilities the Committee has added that the Government Printer, wherever possible, should carry out urgent and confidential work for the Government as may be required from time to time. Much of the other printing associated with the Government’s publishing program would be undertaken by commercial firms.

I draw the attention of honourable members to a number of other matters referred to in the report which due to considerations of time I mention here only briefly. The Committee has recommended that greater responsibilities be given to the Government Printer to check and rationalise the purchase of departmental inhouse reproduction and printing equipment. A grave situation still exists concerning the inadequate salary paid to the Government Printer in comparison with that paid to his State counterparts. This is exampled by the fart that the salary proposed for the Northern Territory Government Printer will be substantially higher than that of our own Printer. The Committee fails to see why the Commonwealth Government Printer on any comparison of responsibilities should have the lowest remuneration of all Australian government printers. Over past years the Government Printing Office has not been provided with sufficient work to enable his plant to be worked to an economic capacity, and significant losses have consequently occurred. The Committee has recommended that a review of its plant and equipment be undertaken to ensure that it is the most appropriate to carry out the role as prescribed by the Committee in this report. Once this equipment has been installed and made operational, the Committee is firmly of the view that it should be worked to full and economic capacity, wherever possible. It has made recommendations to ensure that the Government Printing Office be provided with sufficient work to keep its plant running to an economic capacity.

The Need for a Clarification of Responsibilities

A major overall deficiency of the Commonwealth’s publishing program lies in the fact that nowhere have the respective printing and publishing roles and powers of the Government Printer, the AGPS, departments and statutory authorities been clearly established in a formalised document. Rather, these have been developed by intermittent Cabinet decisions over the years. The lack of clarity in government decisions in this area is such that confusion of responsibility between the various Commonwealth publishing agents has become a significant problem. As a consequence, there has developed a considerable amount of interdepartmental bickering and the establishment of jealousies over each other’s functions. Often departments and statutory authorities ignore or resist AGPS circulars. In other areas, client departments consider that the AGPS has overly asserted its role to a degree where it has been labelled as a policeman and regulatory authority rather than a servicce agent.

In chapter 18 of the report, the Committee has laid down in the form of a charter of responsibilities, what it belives to be the role of the various Commonwealth printing and publishing agents. The clarification of roles given by the charter, if adopted, should remove many of the difficulties which are currently being experienced by the publishing agents of the Commonwealth.

Supervisory Role

During its inquiry, the Committee became aware of the need for the Government to establish a policy body with sufficient authority to direct and supervise departments and statutory authorities when undertaking their publishing programs. The Committee has suggested that the body which it has called the board of review be established and be comprised of senior officers from a number of departments. Its establishment is an essential element of the Committee’s overall design to establish a common sense and flexible approach within the field of Commonwealth printing and publishing. The AGPS as a service agent cannot and should not be placed in a situation where it is in conflict with the publishing aims of its clients. The Committee believes that AGPS should not have an oversighting responsibility and that, consistent with overseas practice, much can be gained by the establishment of a board of review which would undertake this responsibility. It would also look to the board of review to ensure that the proposed charter of responsibilities, if adopted, would be carried out by the various publishing agents. In the event that the board is unable to resolve differences of interpretation or responsibilities, it is suggested that it be given ready access to the Committee to enable further investigation to be carried out. Then, where appropriate, recommendations would be placed before the Government.

Joint Committee on Publications

In the years to come, the Committee will be undertaking a more active role in the oversighting of the Commonwealth’s publishing program. While its investigatory powers are complete and to the satisfaction of the Committee, it feels that the Standing Orders are deficient in that powers to travel and to form itself into a sub-committee are not provided. To assist in its supervisory role the Committee feels that such powers should be available and has recommended that the Standing Orders be amended accordingly.

Other matters

In this report, the Committee has taken the opportunity to recommend a strengthening of the bibliographical control of Commonwealth publications, and the establishment of set procedures to govern Australia’s overseas exchange commitments. It also draws attention to the need for the introduction of a computer generated information retrieval system for members of parliament within the parliamentary building.

Conclusion

While in many respects, the recommendations contained in the report are far reaching and in some areas will attract opposition from many of the parties involved, the Committee firmly believes that a positive attitude should be taken to ensure their adoption. It considers that they are in the best interests of the Commonwealth’s publishing program and ways to achieve their implementation should be investigated rather than reason sought as to why they should not.

In conclusion, I thank the officers of the AGPS who throughout the inquiry offered a great deal of assistance and thoughtful advice to the Committee. In particular, I must also thank the members of the Committee both past and present who have taken part in this inquiry. I draw particular attention to my Deputy Chairman, Senator Missen, who has always given ready attention to the inquiry. It has been a long inquiry and one which has made great demands on its members. Finally, I must commend the staff of the Committee, namely, Mr Tom Wharton, who is Deputy Usher of the Black Rod and has acted in a part time capacity as Secretary of this Committee; Mr Craddock Morton who is a research officer for several Senate committees; and Mrs Nancy Saunders, a typist.

I should say that if inquiries of this nature are to be conducted in the future, availability of staff will be a real problem. I believe part time staff to be inadequate. During the period of any inquiry in the future extra staff should be obtained or at least secondments should be made from other departments on a full time basis to enable such an inquiry to be conducted satisfactorily. I believe that it is unfair to expect part time staff to be involved in giving so much of their out-of-work time to ensure that these inquiries are completed satisfactorily. I commend the report to the House.

page 3308

INCOME TAX ASSESSMENT AMENDMENT BILL (No. 5) 1978

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

Second Reading

Mr HOWARD:
Treasurer · Bennelong · LP

That the Bill be now read a second time.

This Bill contains further measures designed to prevent income tax avoidance. It covers three main matters and in each case the amendment now proposed was foreshadowed in announcements I made earlier this year. The measures contained in this Bill, along with those that have already been introduced in both the income tax and the sales tax fields, constitute a most significant attack on tax avoidance. They are further evidence of the Government’s continuing effort to ensure greater equity in the tax system. Other legislation against tax avoidance was foreshadowed during the year and I regret that it has not been practicable to bring forward all the planned measures before Parliament rises for the summer recess. Legislative form remains to be given to proposals outlined in my statements of 24 September and 3 October 1978. I assure honourable members that avoidance schemes identified in these announcements will be the subject of legislation introduced soon after the recess.

I would like to think that it is understood that anti-avoidance and other taxation legislation introduced this year has, because of its wide scope and unavoidable complexity, placed a considerable strain on those responsible for its preparation. It has just not been possible to do any more in the time. So I think those who might be inclined to be critical that this or that has not yet been done might acknowledge that an extraordinary amount of difficult tax legislation has been produced and a lot of it put into the administrative system. There has been some criticism of the Government’s policy of announcing an intention to legislate against particular avoidance schemes as soon as they are identified, with legislation being introduced at a later date to take effect from the date of the announcement. I am convinced, however, that this is the right way to take action against what, in most instances, are blatantly contrived and artificial arrangements. At the same time, an early announcement is vital to prevent a continuing and substantial loss of revenue. I do accept, however, that lengthy intervals between announcement and introduction of legislation should not occur. The Government will be guided by that objective.

Turning now to the subjects of this Bill, I point out that the first group of amendments are about the pre-payment schemes I referred to in my statement of 19 April 1978. The second group is concerned with avoidance of tax on income from ex-Australian sources derived through trusts, and related problems concerning partnerships. I spoke about these in my statement on 8 June 1978. The third lot of amendments is concerned with tax avoidance arrangements involving truststripping. I made a statement on this subject on 12 June 1978.

Pre-paid Interest, Pre-paid Rent and Similar Schemes

In my statement of 19 April 1978, I described schemes involving pre-payments that fall within two general classes and outlined remedial measures proposed. The first class embraces schemes for pre-payments of amounts under arrangements designed to secure an income tax allowance for what purports to be deductible expenditure but is, in essence, either not a real expense or one of a non-deductible capital nature. An example of a scheme designed to secure an income tax deduction for an unreal or manufactured expense is the pre-paid interest scheme described in my announcement of 19 April 1978. Under that scheme, a taxpayer obtains a loan of $1,000, promptly pays $700 as a pre-payment of interest, and then buys back, or has an associate buy back, the rights in the loan for $370. The aim is to secure a $700 tax deduction for interest for a net outlay of only $70. The $70 is the lenders reward for participating in the scheme.

An example of a scheme designed to secure a deduction for an otherwise non-deductible capital expense is the pre-paid rent scheme I referred to last April. Under this scheme, a taxpayer wishing to obtain new business premises worth $lm arranges for a tax-exempt institution to purchase the premises for that amount, then leases the premises from the institution and pays it $800,000 rent for five years in advance. The taxpayer also takes up an option to acquire the premises for $250,000. The institution makes a non-taxable profit of $50,000 and the taxpayer aims to secure a deduction, in the guise of an expenditure on rent, for the major pan of the capital cost of the building. Provisions of the Bill relating to these pre-payment schemes will preclude the allowance of income tax deductions for outgoings incurred under such schemes after 19 April 1978.

The second type of scheme referred to in my April statement embraces tax avoidance arrangements between associated parties designed to provide a tax deduction to one of the parties in a year of income for an amount that, in whole or in part, will not be taxable to the other party until a later year or over a series of later years. Provisions of the Bill relating to these schemes will apply in two different ways according to whether or not the arrangements involve outlays for the future provision of goods or services. In cases involving such outlays, a deduction is to be available in a particular year of income for only so much of the total amount as can reasonably be apportioned to the goods or services actually provided in the year. In other cases, the deduction in a particular year of income is to be limited to the amount actually paid in the year. The provisions will apply only where the arrangements between the associated parties are entered into for the purpose of tax avoidance and the outgoings are incurred after 19 April 1 978. T stress that the provisions of this Bill designed to counter pre-payment schemes are concerned only with the schemes outlined in my announcement of 19 April. They do not extend to variations of the schemes referred to in my later statement on 24 September. Legislation directed against the further schemes will be introduced early in the autumn sittings.

Foreign Source Income of Trusts and Partnerships

The second group of measures contained in the Bill is designed to limit opportunities to avoid tax on income from an ex-Australian source that is derived through a trust or a partnership. These measures were foreshadowed in my statement on 8 June 1978, and as indicated then, will apply for the 1978-79 income year. The need for these amendments arose out of a High Court decision to the effect that the trust provisions of the income tax law do not apply to income of a trust that is derived from a foreign source. The Asprey Committee described this result as ‘unacceptable’ because it means that Australian residents can defer- or even escape completely- tax on foreign source income that is accumulated for their benefit.

The basic thrust of the proposed provisions is to ensure that both Australian and foreign source trust income to which an Austraiian resident beneficiary is presently entitled in the year of income will be taxed under the trust provisions to the beneficiary or, if the beneficiary is under a legal disability, such as infancy, to the trustee. To provide also for situations in which there is trust income to which no beneficiary is presently entitled- broadly, income that is being accumulated without any beneficiary having a right to demand it from the trustee- a concept of a resident trust estate is being introduced. This was recommended by the Asprey Committee. A resident trust estate will be one with a resident trustee, or with its central management and control in Australia, at any time during the year. In terms of the Bill, a trustee of a resident trust estate will be taxed on the part of world-wide income of the trust estate that is assessable income under the general provisions of the income tax law and to which no beneficiary is presently entitled. As at present, no further Australian tax will be payable by a beneficiary to whom such income is subsequently distributed. The Bill provides, however, for refunds of Australian tax in a special and unusual case. This is the case where foreign source income is later distributed to a beneficiary who was a non-resident at the time the income was derived by the trust estate. In that case Australian tax attributable to the foreign income so distributed is to be refunded on application by the beneficiary.

Provisions are also included to ensure that a resident beneficiary is taxed on foreign source income that had first been accumulated but was later paid or applied for the beneficiary’s benefit. These provisions will apply if the income was not taxed in Australia while accumulating in a trust estate that is not a resident trust estate and would have been taxable to a resident beneficiary had he or she been presently entitled to it when it was derived by the trustee. The provisions include rules designed to prevent a beneficiary escaping tax on a technicality that an amount or benefit is not received as income. Existing provisions of the Income Tax Assessment Act will prevent double taxation of foreign source income to which the amended trust provisions potentially apply where that income has also been taxed in the foreign country of source. To aid administration, a trust which does not have a resident trustee, and which carries on business or derives income from property in Australia, will be required to appoint a public officer in the same way as a company is now similarly required.

The Bill also contains provisions to make it clear that income from abroad is to be included in calculating the net income of a partnership, and that a resident partner is liable to tax on a share of the partnership’s world income, subject to provisions giving relief from double taxation of foreign source income that is taxed in the country in which it arises. Non-resident partners will continue to be subject to Australian tax only on income attributable to sources in Australia. Before moving to the next group of amendments I note that, as I said in my statement on 8 June 1978, the taxation of trust income of beneficiaries is- as has always been intendedbased specifically on the present entitlement of the beneficiaries. The fact that a beneficiary is paid income to which he or she is otherwise presently entitled will not impair the operation of provisions of the income tax law the application of which depends on the beneficiary being presently entitled to income.

Trust Stripping Schemes

The remaining provisions of the Bill will implement proposals I announced on 1 1 June 1978 to deal with trust and associated arrangements seeking to bring about the happy situation that neither the trustee nor an intended beneficiary, nor anyone else, pays tax on substantial income derived by the trust estate. As explained in my earlier statement, there are several variants of the schemes but, for the most part, they rely on a nominal beneficiary being introduced into a trust and being made presently entitled to income, thus relieving the trustee of any tax liability in respect of the income. It is, however, a feature of the arrangements that the introduced beneficiary also escapes tax by one means or another. For example, the nominal beneficiary may be a taxexempt body such as a charitable institution. In any event, this nominal beneficiary retains only a minor portion of the trust income, while the group for whose benefit the trust in substance exists secures effective enjoyment of the major portion, but in a tax-free form. For instance, the nominal beneficiary may have acquired its interest in the income by payment of a broadly equivalent sum to the persons really intended to take the benefit.

The provisions designed to counter these schemes will look to the existence of an agreement or arrangement under which, for purposes of tax avoidance, present entitlement to a share of trust income is conferred on a beneficiary in return for the payment of money or the provision of benefits to some other person, company or trust. In those circumstances, the provisions will treat trust income dealt with under what is aptly termed the ‘reimbursement agreement’ as not being income to which any beneficiary is presently entitled. The effect will be to make the trustee liable to tax on the income under section 99a of the Income Tax Assessment Act at the prescribed tax rate, which is 61.5 per cent for 1978-79. The change in the law will apply to trust income paid to or applied for the benefit of a beneficiary on or after 12 June 1978 under tax avoidance schemes of the kinds mentioned and will not apply in the context of an agreement or arrangement that is entered into in the course of ordinary family or commercial dealing.

Mr Deputy Speaker, I mention that the Government does not seek passage of this Bill until the autumn sittings. As I indicated earlier, I readily accept the need to bring in legislation as soon as practicable after an announcement is made. It is to this end that the Bill is being introduced so that provisions giving effect to the earlier announcements on subjects of the Bill are available for study by interested members of the public and the Parliament, before being debated by the Parliament. The Government is strongly committed to the policy expressed in the legislation but it is of course ready to examine any constructive comments that might be made about technical features of the legislation after it has been examined by interested parties. Details of the various provisions of the Bill are contained in an explanatory memorandum that is being circulated to honourable members. I commend the Bill to the House.

Debate (on motion by Mr Willis) adjourned.

page 3311

NORFOLK ISLAND BILL 1978

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

Second Reading

Mr ELLICOTT:
Minister for Home Affairs and Minister for the Capital Territory · Wentworth · LP

-I move:

As announced in May last, the Government believes that it should try to develop for Norfolk Island an appropriate form of government involving the Island’s own elected representatives, under which the revenue necessary to sustain that government will be raised internally by its own system of law. This Bill provides a framework within which that object can be achieved. It is therefore a landmark in the history of Norfolk Island. It will confer on the Island residents the opportunity to become increasingly involved in their own affairs. It is the Government’s intention that this Bill lie on the table until our next sittings. This will provide an opportunity for public discussion and for the Norfolk Island Council to indicate any views that it may have on particular matters. The Government will then consider whether there is a need for any amendments in the light of any representations it receives.

Under the Bill, wide powers will be exercised by an elected Legislative Assembly and an Executive Council of Norfolk Island comprising the executive members of the Legislative Assembly, who will have ministerial-type responsibilities. The Bill also contains provisions that will ensure the preservation of the Commonwealth’s responsibility for Norfolk Island as a Territory of the Commonwealth. As honourable members will recall, the Royal Commission into Matters Relating to Norfolk Island, conducted by Sir John Nimmo, presented its report in October 1976. That report, which contained 74 recommendations, has been closely examined and has served as a focal point for much of the public discussion on the future of Norfolk Island, particularly on the Island itself. Although, as a result of this discussion and its own consideration, the Government has departed from the report’s recommendations in certain respects, the report remains a valuable document and must be taken into account in any debate on the matter. I am sure both sides of the Parliament and the public are grateful to Sir John for the careful and thorough way in which he reported on these matters.

In determining its policies on the main issues, the Government has had special regard to the attitude of the Norfolk Island Council and residents of the Island, and to the need to take account of the structure of the Island’s economy, its historical background and its way of life that has in a number of important respects preserved the tradition of the Pitcairn Islanders. In broad terms, the Bill constitutes the administration of Norfolk Island as a body politic and equips the Territory with responsible legislative and executive machinery to enable it to run its own affairs to the greatest practicable extent. The Government intends to review these arrangements over the next five years and to increase the scope of the Legislative Assembly’s powers as may be appropriate.

Before turning to the more detailed provisions of the Bill, I would inform honourable members that the Government has decided that Australian taxation and Australian social service benefits should not be extended to the Island. Indeed, it is the Government’s intention as expressed in clause 18 of this Bill that a law of this Parliament should not extend to Norfolk Island unless a special provision to that effect is made in the law. There is a system of social service benefits applying on the Island at present. Needy people can apply to be placed on a list and, if approved, they become eligible for a weekly payment and for free hospital, medical and pharmaceutical services. The Government does not believe that the services provided need be at the same level, or cover the same range, as mainland social service benefits. However, it is firmly of the view, and I have stressed this from time to time, that any benefits available on the Island should be as of right. The Government will retain the executive and legislative responsibility for social service benefits, but it intends to determine appropriate social service benefits and their levels after consultation with the Norfolk Island Council. The capacity of the Island to pay for these benefits will be of fundamental importance.

There is a dearth of reliable statistical information on which to assess the capacity of the Island’s economy. The Government believes that, in order to make decisions about such matters as the Island’s revenue potential and the nature and level of social welfare benefits, it is necessary to have much more information on the economic strengths, weaknesses and potential of the Norfolk Island economy. For these reasons, Professor R. C. Gates, Vice-Chancellor, University of New England, and Professor M. Treadgold, Professor of Economics at that University, have been commissioned to report on the capacity of the Norfolk Island economy. Professor Treadgold visited the Island recently and conducted a census of population and housing and an economic census of business enterprises as part of the economic study. Another matter on which I would touch at this time is that of parliamentary representation. After lengthy discussions with the Norfolk Island Council, the Government has decided that no immediate steps should be taken to provide representation in this Parliament for the residents of the Island, but will review the question at a later date.

I now turn to the provisions of the BUI. Part I provides for the usual preliminary matters of commencement and interpretation. It also repeals the Norfolk Island Act 1957 and the Norfolk Island Act .1963. Part II deals with matters of administration. The Administrator will still have the responsibility to administer the government of the Territory. At present he does so in accordance with the tenor of his commission and in accordance with such instructions as are given to him by the Minister. Provision is made in this Part for him to act in accordance with such advice as is given to him by the Executive Council in relation to a wide range of matters over which executive members have authority. These are listed at Schedule 2 of the Bill. Certain other matters of particular sensitivity or national importance, over which executive members have authority, are subject to veto by the Administrator. These are listed in Schedule 3. Part II also provides for the establishment of a body politic by the name of the Administration of Norfolk Island.

An Executive Council of Norfolk Island to advise the Administrator on matters relating to the government of the Territory will be set up under Part III. The Council will consist of the persons for the time being holding executive office. The number and designations of executive offices will be determined by the Legislative Assembly from time to time and members of the Assembly will be appointed to those offices by the Administrator, acting on the advice of the Assembly. The Administrator may terminate such appointment on the advice of the Assembly or, in exceptional circumstances, on his own initiative. It is also provided that the Administrator will be entitled to attend meetings of the Executive Council, shall preside when he is present and shall convene all meetings. Any member of the Legislative Assembly is entitled to attend all meetings of the Council-

Part IV deals with the legislation-making process. It provides for the continuation of existing laws and for the amendment and repeal of those laws. The Legislative Assembly will have power to make ordinances for the peace, order and good government of the Territory. This power is not limited to those matters in respect of which executive members will have executive authority as specified in Schedules 2 and 3. All ordinances passed by the Assembly will be presented to the Administrator for assent. The Administrator shall assent or withhold assent to all such proposed ordinances which in his opinion make provision for matters listed in Schedules 2 or 3. In all other cases he shall reserve the ordinance for the Governor-General’s pleasure. Where an ordinance is in relation to a Schedule 2 matter he will act in accordance with the advice of the Norfolk Island Executive Council. If Schedule 3 matters are involved, he will act in accordance with the instructions of the Minister.

Where the Administrator reserves an ordinance for the Governor-General’s pleasure, the Governor-General shall assent or withhold assent to all or part of the ordinance. The Governor-General may disallow an ordinance assented to by the Administrator within 6 months of assent. Reasons for withholding assent to any ordinance shall be tabled in the Legislative Assembly at the first opportunity. Any proposal to dispose of or charge any public moneys will require a message of the Administrator to the Assembly before it can be considered.

The Governor-General may, by message of the Administrator, introduce an ordinance into the Assembly. In such cases, where the Assembly does not within 60 days pass the proposed ordinance or amends it in a manner considered unacceptable, the Governor-General may make the ordinance. In cases of urgency or for other special reasons, the Governor-General may make an ordinance without first introducing it to the Assembly. These powers do not extend to Schedule 2 or 3 matters. The Governor-General will have power to make ordinances authorising the expenditure of the public moneys of the Territory in cases of urgency. This is to deal with a special case, for instance where the Assembly holds up a Budget and there are no funds available to carry on a public service. Where the Governor-General exercises his powers as I have just described, the ordinance shall be laid before each House of Parliament within 15 sitting days. If it is not so laid it shall be void and of no effect. Either House may within 15 sitting days disallow all or part of such an ordinance. Ordinances made by the Governor-General will prevail over an ordinance made by the Assembly where they are in direct conflict but in other cases will operate concurrently.

Part V of the Bill deals with the Legislative Assembly. At present there is a Norfolk Island Council of eight elected members which may consider and tender advice to the Administrator concerning any matters affecting the peace, order and good government of the Territory. This Council will be abolished and replaced by a Legislative Assembly of the Territory consisting of nine elected members, with the wide powers that I have described earlier. Provisions for qualifications for election, filling of casual vacancies, dates for elections, meetings, procedures, election of a President and Deputy President, minutes of proceedings and the making of standing rules and orders are included in this Part.

Under Part VI, which deals with finance, it is provided that there shall be a Public Account of Norfolk Island consisting of all public moneys of the Territory, available for the purposes of the government of the Territory. This will preserve the existing financial arrangements for public moneys. Receipt, expenditure and control of public moneys, including investment, shall be as provided for by ordinance. The Minister for Finance will be empowered to lend money to the Administration or a Territory authority. The Treasurer will be empowered to approve borrowings from other sources and to guarantee repayments by the Administration of such borrowings. Part VII provides for the continuation of the judicial system which was set out in the Norfolk Island Act 1957. Reference in that Act to appeals to the High Court has been omitted because such appeals now lie to the Federal Court of Australia under the provisions of the Federal Court of Australia Act 1976.

Part VIII ensures the continuation of present laws regarding employment and appointment of officers, grants of land and audit by the AuditorGeneral, and provides for the regulation-making powers of the Governor-General. The Part also provides that the remuneration payable to members of the Legislative Assembly and the Executive Council may be determined by the Remuneration Tribunal. There are transitional provisions under Part IX for the first general election of the Assembly, existing appointments of Administrator, Acting Administrator and Deputy Administrator, certain proposed ordinances and regulations, laying of ordinances before Parliament, the validity of existing ordinances, preservation of existing contracts and the transfer to the administration of the Public Account of Norfolk Island.

I take this opportunity to place on record my appreciation of the work done by the members of the present Norfolk Island Council who took up office in July of this year, and those of the previous Council, towards the preparation of suitable legislation for the future government of Norfolk Island. I also wish to express my confidence in the political and economic future of the Territory of Norfolk Island. The process of responsible government which will be set in train by this Bill is a very important step forward for the Territory in managing its own affairs.

As will be clear to honourable members, the success of the arrangements now proposed will depend greatly on the maintenance of close cooperation between the Commonwealth Government and the Norfolk Island Legislative Assembly. On many important matters, of which financial and Public Service arrangements are leading examples, the only workable method of proceeding is by way of consensus. Thus, it is intended that in practice there will be only one fiscus and one Public Service to serve the needs of the Administration as a whole. I am sure, from my discussions with members of the Norfolk Island Council and residents, that the necessary spirit of co-operation will prevail and be reinforced over the years. It is therefore with confidence that I commend the Bill to the House.

Debate (on motion by Mr Innes) adjourned.

page 3313

AUSTRALIAN DRIED FRUITS CORPORATION BILL 1978

Second Reading

Debate resumed from 15 November, on motion by Mr Sinclair:

That the Bill be now read a second time.

Mr ELLICOTT:
Minister for Home Affairs and Minister for the Capital Territory · Wentworth · LP

- Mr Deputy Speaker, may I have the indulgence of the House to raise a point of procedure on this legislation. Before the debate is resumed on this Bill I would like to suggest that it may suit the convenience of the House to have a general debate covering this Bill, the Dried Vine Fruits Equalization Levy Bill 1978, the Dried Vine Fruits Equalization Bill 1978 and the Dried Fruits Export Charges Amendment Bill 1978 as they are associated measures. Separate questions will, of course, be put on each of the Bills at the conclusion of the debate. I suggest, therefore, Mr Deputy Speaker, that you permit the subject matter of the four Bills to be discussed in this debate.

Mr DEPUTY SPEAKER (Mr Drummond:
FORREST, WESTERN AUSTRALIA

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

Mr FitzPATRICK (Riverina) (3.46)-I have discussed the provisions outlined in the four dried vine fruit Bills which are before the House- they are the Australian Dried Fruits Corporation Bill 1978, the Dried Vine Fruits Equalization Levy Bill 1978, the Dried Vine Fruits Equalization Bill 1978 and the Dried Fruits Export Charges Amendment Bill 1978- with the growers and grower organisations in my electorate. Both the growers and the grower organisations seem to be unanimous in their support of the establishment of a statutory equalisation scheme for equalising market returns on dried raisins, dried currants and dried sultanas. They are also in agreement that the relevant statutory authority be restructured and be given additional powers, including that of administering the equalisation scheme. It appears from an examination of the four Bills that the legislation has been drawn up to achieve that purpose, namely, the establishment of a statutory scheme for equalising market return on dried fruit.

Because these Bills have the support of the grower organisations, I believe that they will achieve the equalisation of market returns on dried currants, dried sultanas and dried raisins that are sold both on the domestic and export markets. This should remove some of the major grievances that have been bugging growers and packers of dried vine fruit for a long time.

The Minister for Primary Industry (Mr Sinclair), in his second reading speech, said that he was dealing briefly with the reasons for introducing these measures. It appears to me that he has given a pretty clear explanation of the reasons for introducing these measures. I am happy to say that the reasons given are consistent with the wishes of the growers and grower organisations in my electorate. It is true that the voluntary scheme or system of equalising returns from the domestic and export outlets has been operating for over 50 years. However, the very fact that some packers and growers were getting higher prices by selling on the domestic market without carrying their share of the obligation to supply the export market at a lower price was undermining the value of this voluntary scheme. Because of this, the growers in my electorate have continually asked the Government to secure the equalisation system by placing it on a statutory footing.

The principle of imposing a levy on the production of each variety of fruit in a season and of relieving from the levy fruit that is exported seems to me to be the best way in which to achieve this equalisation. It certainly has the approval of the growers. However, growers are keen to see that no loopholes are left in the Act. They require more information on what the Minister meant in his second reading speech when he stated:

Fruit that is exported will be relieved from the levy as will also fruit which for some reason does not pass into commercial channels as packed fruit for human consumption.

The growers want, as far as possible, all fruit to pass through the commercial channels. I would like to see no loopholes left in the Bill under which the scheme can be bypassed as was the old equalisation scheme. I ask the Minister whether he can give some explanation on that point. We have no objection to the equalisation payment being made payable to the producer of the fruit; that is, the dried fruit grower. However, we do see some danger in the remainder of the Minister ‘s statement in that paragraph. He goes on to say: but packers will have a right subject to appropriate authorisation by the producer, to apply such moneys in their hands to discharge producer indebtedness to them, including indebtedness arising from costs and charges associated with the packing of a producer’s fruit.

Under the old scheme, growers often complained to me that because they were in debt to the packing sheds not enough of their money was released to give them a comfortable living. I see some danger in that situation and I hope that some safeguards can be written into the legislation to protect people in those circumstances. It is realised that provision must be made for exemption of some fruit from the levy. The example given by the Minister is certainly one of the classes of fruit that should be exempted. The Minister said that that class of fruit was dried fruit processed at certain packing establishments from fresh grapes by a relatively costly process of dehydration in tunnels. We know that small quantities of such fruit are produced to meet the requirements of specialty markets and because of the cost of the process it is not appropriate that the return for it should be equalized with dried vine fruit produced in the traditional manner, as this would place other growers at an unfair advantage.

We have to ensure that care is taken to see that the exemption provisions do not get out of hand and that they are not extended in any way. We want some restriction kept on that exemption. The Opposition agrees that fruit exempted in this way is not entitled to an equalisation payment and exports, if any, would not participate in the export accounting arrangements. It is also noted that in particular circumstances a variety may be completely exempted from a levy in a season. Where this occurs, the equalisation mechanism is, in effect, put in abeyance for the variety for that season, as no equalisation payment would be payable and the system of transfers between the fund and the exporters would not operate.

The examples given by the Minister of where this situation would apply seem to be very logical. They are: Where production of a variety falls to a level close to the Australian market requirements, where the differential between domestic return and assessed average export returns becomes marginal- that is, less than $20 per tonne- and where the assessed average export return exceeds the domestic return. In those circumstances there will be no need for the equalisation scheme.

The Opposition sees no reason for the transfer of money in those cases. We agree that whether the marketing circumstances in 1979 will necessitate the application of the equalisation mechanism to that season is a matter for recommendation by the Corporation in due course. It does not appear to us that it will be necessary to apply the mechanism in 1979. However, there is a possibility that, through chance factors, very high export prices may be obtained in a particular season. It does not really remove the essential problem that statutory equalisation is designed to meet. The Opposition agrees that the dried fruits equalisation levy is necessary to meet the objectives of the dried vine fruits equalisation scheme and to impose a levy under certain conditions on the dried fruit that is produced in Australia.

The Opposition also agrees that the Dried Vine Fruits Export Charges Amendment Bill 1978 is necessary, consequential to the Australian Dried Fruits Corporation Bill 1978. The Opposition thinks that the Dried Fruits Corporation Bill represents a major change in the production and marketing of the dried vine fruits because it provides for the establishment of an Australian Dried Fruits Corporation to replace the Austraiian Dried Fruits Control Board which has been in existence since 1925. Although I suppose that overall it could be said that the Board did a fairly good job, there have been several complaints about it and the consensus seems to be that it is time for a change. Most of the growers seem to be satisfied with the set-up of the new Corporation which of course has only 8 members, compared with 11 members of the Board.

It gives the opportunity for four members to be representatives of the growers. They will be selected from a panel by the Minister for Primary Industry. Two members will be ministerial appointments and will be persons who are specially qualified by reason of experience in marketing or promotion of dried fruits or other products or who have experience in commerce. The Opposition thinks that this is common sense. Not too many growers have this expertise to see that fruit is marketed properly. It is good to know that, in making these appointments, the Minister will consult the Australian Vine Fruits Association and other bodies that he considers are appropriate. The fact that all members will be appointed as part time members and that the term of office will be three years meets with the approval of Opposition members. We have found that one of the main complaints about the old system was that some people whom the growers did not like were on the Board, and it was a major operation to remove them. We think this provision is good. It seems to meet the general approval of the producers, as I have already mentioned.

The revision of the Board to the Corporation will provide for a smaller and more compact body with a wider range of skills and expertise available. As the Minister pointed out in his second reading speech, it will have wider powers and functions. It appears that the Minister has gone out of his way to produce a set of Bills that are consistent with the wishes of the producers. There is no doubt that this is of some satisfaction to the dried vine fruit producers because, as the Minister and anyone else who is connected with the dried fruit industry knows, the producers have had more than their share of problems in recent years. It is only because of the failure of crops overseas that many of them have been able to survive. The fact that dried fruit was being shipped over the border was causing some problem in the dried fruit area. The producers still have many other problems, including the problem of overproduction due to the lack of agreement about new planting between the various States.

I point out that the dried vine fruit grower is not in this financial predicament through his fault. He had to face adverse seasons in 1971, 1973 and 1974, so much so that the Australian Dried Fruits Association made a submission to the Industries Assistance Commission. The recommendation was that the Commission inquire fully into the federal raisin insurance program for dried fruit producers in California so that it may be able to recommend to the Australian

Government the establishment of a rain insurance program that would be appropriate to the Australian dried fruits industry. My mind goes back to last year when hail damaged a lot of the fruit in the Sunraysia district. The Board considered that if the industry had had suitable insurance during those adverse seasons it would not be in the financial predicament in which it is today. Further, it made a recommendation that consideration be given to the establishment of a food bank throughout the world in strategic centres, together with the provision of suitable transport and distribution facilities.

This is another factor which is causing a great deal of problems for the Australian fruit growers because they have a fluctuating production level. Sometimes they do not grow enough fruit and at other times they have too much. They feel that if they could have this food bank it would have a cushioning effect. Unfortunately often they have had to cut off supply to their markets. So that they could supply the bigger markets, they have had to drop other markets altogether. With some kind of a food bank this problem could be overcome. I have already pointed out to the House the interrelationship between the dried fruits industry and the citrus juice industry. I have also indicated that the IAC has recommended that the 65 per cent ad valorem tariff on imported juices be removed and replaced by a 20 per cent duty. I point out that if this Government endorses the IAC’s recommendation all the good work that is contained in these Bills will be wasted because the towns in the dried fruit growing areas are interdependent. Some farms produce citrus fruits as well as dried vine fruits. Many of those towns will be only half their present sizes if the IAC’s recommendations are implemented.

The growers of citrus fruit need $100 a tonne to produce the juice. If they have to compete with this lower standard imported citrus juice they would have to sell their fruit at less than $62 a tonne. I ask the Government to consider that point. I believe that all of us have some obligation to see that the dried vine fruits industry survives not only because some of our best inland towns depend on that industry for their survival but also because there are 5,500 dried vine fruit producers and 70,000 other people who are dependent on the industry. The history of the dried vine fruits industry has shown that it has always been able to adjust to a change in circumstances. Even at present it is earning valuable export income for the Australian Government. I ask the House not to overlook its problems because I think they are really worthy of consideration.

Mr FISHER:
Mallee

-I support these four Bills that relate to the Australian dried fruits industry. Basically these Bills do two things: Firstly, they provide for a statutory scheme for equalising the market returns that are received for dried currants, dried sultanas and dried raisins that are sold on our domestic and export markets; and, secondly, they provide for the establishment of an Australian Dried Fruits Corporation to replace the Australian Dried Fruits Control Board which has been in existence since 1925. The development of the dried fruits industry in the Murray Valley by the Chaffey brothers has been of enormous magnitude, both in economic terms and as a successful decentralisation program. Although the first crop of five tonnes of dried fruit was not recorded until 1891, the production of some varieties already was in excess of Austraiian requirements by 1907. 1 think this indicates the development and suitability of this crop to this region of Australia.

A simple equalisation scheme was introduced by the Australian Dried Fruits Association in 1909. This scheme was observed only by ADFA members. Although several methods of enforcing observance of export quotas by members outside the Association was attempted, few of these measures proved successful. As early as 1915, representations were being made to the Commonwealth and the State governments seeking administrative and legislative assistance so that the objectives of orderly marketing could be advanced and protected. High export prices from 1915 to 1922 gave an added confidence to the industry and led to considerable expansion mostly under the sponsorship of the war settlement scheme. However, in 1923 as many areas were coming into production Mediterranean fruit reached the United Kingdom market in large quantities and the price of dried fruit on this market dropped by 50 per cent.

The voluntary scheme of market control by the ADFA could not withstand these economic pressures. In 1923 the industry again approached the Commonwealth and the State governments seeking legislative assistance to establish and enforce fruit quality standards as well as enforcing market equalisation. A final scheme was approved. It provided that each of the producing States would declare the percentage of its production which had to be sold outside Australia and that the Commonwealth would determine the terms and conditions under which dried fruit could be exported. A dried fruits board was established in each producing State to control Australian sales. A Commonwealth board was established to control export sales. In addition, at that time immediate financial assistance was provided to the industry through the Dried Fruit Advances Act 1924. These advances were repaid by the growers at a 6 per cent interest rate.

Under this scheme the States played a dominant role in market equalisation by determining the quantity of fruit that any one agent could sell in Australia. The Commonwealth Control Board ‘s role was more passive. It effected control only over that fruit offered for export. However, an added inducement for packers to export was provided by empowering the Board to make expedient advances of up to 80 per cent of the fruit value against fruit offered to it for export. This provision was supported by the Export Guarantee Act 1924. As a result of challenges in the High Court of Australia, the 1924 Act was declared invalid as being contrary to the provisions of section 92 of the Constitution. As a result, in May 1928 the Commonwealth Dried Fruit Act was introduced. From this time until today the State governments have played no part in market equalisation. The dried fruit industry has, from that time to the present, been successful in maintaining orderly marketing of dried fruit within Australia on an independent voluntary basis. The Dried Vine Fruits Equalization Bill 1978 that has now been introduced by my Government at the request of the industry establishes this statutory scheme.

At least one-third- probably close to 40 per cent- of the Sunraysia and Robinvale populations and a major percentage of the population of the mid-Murray area in my electorate is directly or indirectly dependent on the dried fruit industry. Annual production of dried fruit today is approximately 60,000 tonnes, one-third of which is marketed in Australia. The value of this crop varies, depending on the season and the price, between $40m and $S0m. In ordinary circumstances the return from Australian marketing has been much more attractive than the return from the export market. However, it can be anticipated that for the first season of this statutory equalisation scheme circumstances will exist in which export returns exceed the domestic return. This has come about through the substantial failure of the 1978 Californian crop. There is every likelihood that export prices in 1979 will be at an extremely high level. This, however, does not remove the essential problem that statutory equalisation is designed to meet.

The scheme will provide for a compulsory levy disbursement arrangement under which dried vine packing houses will receive for ultimate payment to growers an equalised return for domestic and export sales. Levies will be raised on the production of each variety of fruit but there will be an exemption for the production which is exported. The rate of the levy will, therefore, be the difference between an assessed average domestic return and an assessed average export return to the packing house. Levy proceeds will form varietal equalisation funds into which will also be paid by exporters export receipts in excess of the assessed average export return. Disbursement from the funds will be made by two packers to achieve the equalised return.

Before I comment on the structure of the Australian Dried Fruits Control Board I will mention one or two other areas that are concerning the dried fruit industry at the moment. One that is of prime concern is the possible entry in the near future of Greece and Turkey into the European Economic Community. I have asked both the Minister for Primary Industry (Mr Sinclair)- he has now replied- and the Minister for Special Trade Representations who is presently in the EEC to study closely the problems that may develop as a result of these two countries, which are the greatest competitors of the Australian dried fruit industry, entering the Common Market. I also refer to the negotiations last year by the dried fruit industry of a hail insurance scheme. Horticultural crops do not attract successful hail insurance schemes within the commercial sector. It has been difficult for many years to establish a viable insurance scheme to protect the industry, particularly the dried fruit industry. Last year a scheme was developed in negotiation with a major insurance company. It has proved to be of enormous benefit already this year when some growers had their crops damaged by hail in the Sunraysia area. I appeal to growers involved in the dried fruit industry to insure their crops. Not only will this ensure protection of their incomes but also will it ensure that the premiums paid by all growers will be as low as possible.

I am sure that the honourable member for Riverina (Mr Fitzpatrick) is in a more relaxed mood over the last three years in supporting some of the Bills that have been put forward by our Government in the agricultural sector than he was a few years ago when, tongue in cheek, he had to support the Bills put forward by the Labor Government. I congratulate him on the understanding that he has of the industry and for the work he does for the people he represents on the New South Wales side of the River Murray. I turn now to the establishment of the Australian Dried Fruits Control Board. It should be recognised that this measure also was requested by the industry. With the development of a statutory equalisation scheme, the Government is taking the opportunity to restructure the composition and functions of the Australian Dried Fruits Control Board. This restructured body will be known as the Australian Dried Fruits Corporation. Aside from its administration of the equalisation scheme it will continue the regulatory control of export carried out by the former Board. It will have the power to engage in trade, subject to ministerial approval. It will also have the authority to borrow money for this purpose. Appropriate provisions are being made in the legislation for a government guarantee for such borrowings.

Another major change in respect of the Constitution of the controlling authority is that it will have fewer members than the Board it replaces. The number will be reduced from 1 1 to eight. Four members will represent growers. These will be selected for appointment by the Minister from a panel of nominees submitted by the industry itself. Two members will also be appointed as ministerial appointments. They will be persons specifically qualified by reasons of experience in marketing or promotion of dried fruits or other products. They may also be experienced in commerce, finance, economics, science or other industrial matters. In making these appointments the Minister for Primary Industry will consult with the dried fruit industry and with any other bodies that he considers appropriate. The two remaining members of the new corporation will be a member to represent the Commonwealth and an independent chairman. These will also be appointed by the Minister. All these members will be appointed as part time members and the term of office will be three years. The Dried Fruits Corporation will be financed, as was the former Board, by a charge on exports of dried vine fruits. It is anticipated that the smaller and more compact body with a wider range of skills and expertise available to it and with its widening powers and functions will meet the needs of the industry in the future. I think it is also fair to mention, as the representative of the electorate producing almost all the dried fruit in Australia, that there has been some opposition and some difference in opinion to this particular legislation.

This different opinion has been held mainly because of the view that in any marketing system which seeks to achieve anything like optimum performance from all the sectors involved, be they grower, packer, processor, agent or retailer, it is imperative to seek out the means by which either the rewards or the penalties incurred in the market place are accurately transmitted to each sector of that industry. Some people in the industry do hold the view that in a close appraisal of this equalisation scheme it does not achieve that particular objective. I disagree. I emphasise that the Government and I, as the member representing the Sunraysia area, believe that the views expressed by the Australian Dried Fruit Association represents the majority of people involved in the dried fruit industry. That industry has had a long history of self-help and regulation. This has been achieved through the co-operation and loyalty of its members, the growers, packers and the various organisations. This loyalty has often been retained through times of quite substantial difficulty and now, fortunately for the industry, through times of prosperity.

I am convinced that this legislation implementing a compulsory equalisation scheme and the restructuring of the corporation proposed at the same time, will place this industry in a position that will allow it to cope with the enormous pressures that any agricultural industry in Australia faces- facing the high internal cost structure of our nation yet having to operate very largely on a difficult export market. Further, I am convinced the policies the Government is following mainly in reducing inflation and in reducing interest rates are of major importance to the agricultural sector of the Australian economy. With the member for Riverina (Mr Fitzpatrick) and I am sure the member for Wakefield (Mr Giles) who is to follow me in this debate, I have great pleasure in supporting this legislation. I am quite sure it offers to the Australian dried fruit industry continued stability and viability.

Mr John Brown:
PARRAMATTA, NEW SOUTH WALES · ALP

– The Opposition basically supports the Bills relating to the Australian dried fruits industry and recognises the importance of the dried fruits industry to the Australian economy. Whilst there are no dried fruit growers in the Parramatta electorate, I think it is pertinent to suggest at this stage that the grape industry started in Parramatta along with the granny smith industry and a few other industries so I guess it gives me some reason to speak on this Bill. There is also the fact that we have a great number of fruit cake eaters in Parramatta who are very concerned about the dried fruit industry, particularly with Christmas coming along. In opposition to the honourable member for Mallee (Mr Fisher) I do not think we can totally subscribe to his views that the Labor Party in office did great damage to the agricultural industry. I do not think that is the case at all. The fact that we are supporting these Bills is evidence that on this side of the House we are very worried about the agricultural industry and we are very anxious to support it. I know we are accused of being socialists. We make no apologies for that but we consider our socialist activity should extend to the country as well as to the city. It is for that and many other reasons that we support these Bills.

Australia ranks approximately equal third with Greece among the world producers of dried fruits, after the United States and Turkey and ahead of Iran. In the 1977 season Australia produced 64,467 tonnes of dried vine fruits. As you would know, that would make a lot of fruit cakes. The value to the Australian economy in the year 1977-78 was $55.4m of domestic sales and $35. 8m from exports, so it is obvious that this is a very big revenue earner in both the domestic and export areas, so it is the reason for our concern. Of the dried fruit produced in 1977, 56.2 per cent was consumed by the export market and 43.8 per cent by the domestic market. However, the industry is beset by several problems. As indicated by the production figures, domestic prices for dried vine fruits are maintained at a higher level than export prices. In order to regulate this situation the industry has since 1911, operated a voluntary system of equalising the returns from domestic and export outlets through the Australian Dried Fruits Association.

This voluntary scheme is now increasingly subject to the pressures of developing competition between dried fruit producers with the inherent risk that fruit will be diverted from the export market to the domestic market which, whilst more lucrative is less able to absorb increased production. This is one of the reasons why I am suggesting to all those who may be listening that they should be buying another fruit cake for Christmas to support this wonderful industry. Export prices fluctuate greatly from year to year according to world supply and economic conditions in the consuming countries; unfortunately incomes received by growers have fallen behind those of other sectors of the economy for equivalent investments of capital and skills. Hence many farms producing dried vine fruits are not economically viable units. The Industries Assistance Commission in its 1976 report on dried vine fruit stated that in Sunraysia, one of the major grape growing areas of New South Wales, ‘between thirty and forty per cent of the present commercial farms have little prospect of viability as full time fruit growers.’ Further, ‘a major reorganisation of the industry is therefore necessary.’

The purpose of the four Bills before the house is the establishment of a statutory scheme for equalising market returns for dried vine fruits and restructuring of the Australian Dried Fruits Control Board to provide it with additional powers. The Australian Dried Fruits Corporation Bill 1978 seeks to establish the Australian Dried Fruits Corporation to replace the Australian Dried Fruits Control Board. It reduces the number of members of the Board to eight, of whom four will be representatives of the growers. The Corporation will continue to carry out the functions of the Board and will have the additional function of administering the statutory equalisation scheme. The Dried Vine Fruits Equalization Levy Bill 1978 aims to impose a levy upon certain dried vine fruits in order to meet the objectives of the Dried Vine Fruits Equalization Bill. That is all very involved, but what it amounts to is that the four Bills complement one another.

The Dried Vine Fruits Equalization Bill seeks to place the previously voluntary system of equalisation on a statutory footing. The levy is collected on fruit destined for the domestic market and held in an equalisation fund maintained by the Australian Dried Fruits Corporation. This levy represents the amount by which the anticipated average return from the domestic market for the variety exceeds the assessed average export return. Thus fruit sold on the Australian market will receive an initial return comparable to the anticipated average level of return from similar fruit sold on the export market. I said at the outset of this speech that the Opposition basically supports the Bills relating to the Australian dried vine fruits inustry. I would point out that the Industries Assistance Commission Report of 1976 relating to the dried vine fruits industry recommends the replacement of the equalisation scheme by a two pool system of marketing. The two pool system provides for the separation of the domestic market from the export market. I think a great number of growers would prefer that scheme. My colleague on my right says he doubts that but I know a great number of growers who believe that the scheme as proposed by the Industries Assistance Commission would be preferable to the Government scheme. I will have to agree to disagree with him on that small point.

Growers are allocated quotas or entitlements to a share of the higher priced domestic market. Production additional to these entitlements would be paid for at the market price. The advantage of this scheme is that it gives the producers the incentive to sell their over-quota production only to those export markets they find profitable. Decisions to produce dried vine fruit would be made on the basis of the actual values of additional output, thus eliminating the costs of resource misallocation and allowing the owners of non-viable holdings better to transfer their resources to other activities by selling their domestic market shares. In short, the two-pool system would better facilitate the necessary restructuring of the industry than would the equalisation scheme.

The final Bill before the House, the Dried Fruits Export Charges Amendment Bill 1978, seeks to introduce amendments to the Dried Fruits Export Charges Act 1924 that are consequent to the Australian Dried Fruits Corporation Bill 1978. With reservations regarding the preference of the two-pool scheme recommended by the Industries Assistance Commission over the equalisation scheme, the Opposition supports the four Bills relating to the dried fruit industry. It is fortuitous that the first season of the statutory equalisation scheme, 1979, should produce circumstances in which the export return exceeds the domestic return. This came about through the substantial failure of the 1978 Californian crop of grapes. I guess that that could be a cause of great worry to Dean Martin and others in California who like a drop of wine. It may have a very good effect on our situation in Australia in that export prices in 1978-79 will be extremely high. We feel that perhaps this year the equalisation scheme might not cost that much money. In short, we support this Bill because we believe that this industry- along with many other agricultural industries- needs the support of the Government. The Opposition supports the Government’s effort to supply that support.

Mr GILES:
Wakefield

-I do not think there is much point in repeating the mechanics of the legislation as dealt with so well by my friend from Riverina (Mr Fitzpatrick). I rise to support my better friend the honourable member for Mallee (Mr Fisher). I do not intend to go over the machinery of the schemes which in debates in this House over a period of time have been well worked over. This afternoon I will take just a few minutes to be a little more contentious and to question some of the beliefs with which we have grown up and with which the dried fruit industry itself has grown up. I do not mean in any way to denigrate the great efforts of the Australian Dried Fruits Association in the past It is certainly one of the more successful producer groups that operates in the rural scene.

This House should look at the latest Bureau of Agricultural Economics forecasts and assessments on rural incomes during this year to see where the income increases come from- in which industries- that show a rise of 40 per cent plus in farm income and a rise of 30 per cent plus in constant terms. I cannot see that these figures come from irrigated areas. Obviously those industries that of necessity are labour intensive will not build up these sorts of increases in this year. I appreciate, as do the honourable member for Parramatta (Mr John Brown), the honourable member for Riverina and the honourable member for Mallee, that the dried fruit industry has performed- and also the Australian Wheat Board- almost above capacity over the years, if it is not rude to say that of both of them, to a far greater extent than perhaps some of the cooperative boards in the dairying industry and elsewhere which have not been as efficient.

At this stage I think one should stop to question whether these measures will enable the industry to operate in the next decade as well as it has operated in the past few decades. I have already made the point that the dried fruit industry is dealing with its own problems. It equalises the incomes of many of its producers according to the quality of the varieties supplied and handles its own affairs very effectively. Now and again the House should stop to look at the question of whether the system of stabilisation and equalisation really give full merit to the highly efficient producer. There is no earthly use in deceiving ourselves that there is not a need for constant adjustment, both on the decision of the farmer and on occasion by decision of the Government by operating attractive schemes.

In this day and age there is no such thing as an industry that has to persist because it is there. A holding that has 10 acres today might need IS the day after tomorrow to be productive. That is not necessarily an across the board argument. We always have to be aware that growers must not be locked into, shall we say, a degree of poverty by a stabilisation scheme. This Parliament should not accept that principle. Looking far enough ahead, the acceptance of that principle could be dangerous. Everybody has to adjust. The huge increase in cost input brought about by the three years of the Whitlam Government drove this home more than anything else. I do not say that in any impolite fashion. People on small farms had never experienced this before. They are now posed with the problem of a lifetime investment in vines or trees on which they cannot continue to function at their old level. Their attitude is that therefore the Government is wrong. Honourable members on both sides of the House have to get that clearly into their heads and if need be show some guts sometimes when they are out in these rural areas. It would be unreal for members of this House, from one side or the other, to go out and to adopt the view that due to the largesse of government expenditure, the heavy use of taxpayers’ funds, because a farmer is on his property he has more right to be there than a corner shopkeeper. Both have to adjust to the changing circumstances of the day.

The honourable member for Parramatta is a new voice on horticultural Bills. I thought that about two-thirds of the way through his speech he made a lot of sense and I congratulate him for it. I also congratulate other speakers. I do not want in any way to denigrate the capacity of this industry to look after itself. It has a good record and it will have a good record in the future. It needs some help from overseas storms and frosts and what have you. We know that the present situation may be a bit artificial. I strike the note of warning that a stabilisation scheme coupled with an equalisation scheme should not lock people into a situation in which they are inefficient. I do not mean that they do not work hard; I mean where they have a form of production which means that they cannot operate profitably. That is the final warning note I would sound.

I congratulate the Government for not including tree fruit products in the provisions of these equalisation Bills. One might well ask why. The honourable member for Parramatta said that these Bills must be good Bills because they are bringing socialism into the country. We could debate whether a co-operative is the final form of free enterprise or indeed whether it is socialism and compare the situation with corporations at great length, but I will not do so now. I think it is proper to compare this scheme with other agricultural schemes the Government has produced recently. The Australian Dried Vine Fruits Corporation joins a list of corporations that are almost coming out of the woodwork at present. I would have liked to have seen a body with such an important sounding tide as ‘corporation’ have a different implication over the entire crop growing field. I would have liked to have seen this Corporation incorporate the activities of the Aus.tralian Wine Board and all sorts of grape growing activities including the alternative use of grapes over a wide variety of subjects. The record of this Board has been good. Let us take a look at its complement. The size of the old Aus.tralian Dried Fruits Control Board was 1 1 but that number has diminished to eight. As other speakers have said four of those eight members on the new Australian Dried Fruits Corporation will be grower representatives. I think this is a measure of the fact that the industry has done very well by its growers in the past. One should compare this situation with other industries. Growers were upset at the poor performance, in their view, of what was previously the Australian Meat Board. The Meat Board, of course, had a majority of primary producers on it.

My rural committee fought very hard to bring in the new system. Of course, we had to stand up to thousands of highly irate farmers because, for the first time, with the new information of the Australian Meat and Livestock Corporation it did not have a majority of grower representatives. Quite frankly I think honourable members must realise- undoubtedly they will in relation to this Bill- that some people are very adequate and expert at producing a commodity but they are not necessarily the right people to help market and sell that commodity. That was why my committee took the view it did on the Australian Meat and Livestock Corporation. To varying degrees, the Australian Dried Fruits Corporation joins the Australian Dairy Corporation and the Australian Apple and Pear Corporation and one other body whose name does not occur to me at this time. I wish these corporations well. I hope with all my heart that they take into account in the years to come the need to be merciless and the need to take a realistic attitude. They should not prolong agony as a rural attitude. Honourable members opposite may criticise honourable members on this side of the House who are involved in the rural scene. But I think that they should refer to this Government’s treatment of the dairy industry in late 1969 and in the early 1970s. What did we do? We propped up the dairy industry with a variety of subsidies. We succeeded in prolonging the individual misery of a whole lot of small dairy farmers for 10 years longer than we needed. On the other hand, I am not in tune with allowing attrition to take place through market forces.

There is a limit as to how far governments can go. I think one of the roles of governments is to encourage people to work out their own destinies, not to interfere any more than they have to. Governments should encourage growers or their sons to realise that, for instance, when time is running out on a five-acre dried fruit block they should be thinking about getting into an area that is more productive and more satisfying for them and for the industry. I support the Bill, in spite of the theorising I have gone on with today and I think it is important to do that from dme to time. I wish the new Corporation the best of fortune in its work on behalf of the industry.

Mr KERIN:
Werriwa

-I would not like to indulge in too much philosophical or economic theorising but I do largely agree with what the honourable member for Wakefield (Mr Giles) has said with respect to the dried vine fruits industry. I also concur with what the honourable member for Parramatta (Mr John Brown) said with respect to the reasoning behind the recommendations of the Industries Assistance Commission for a two-pool price scheme as an alternative. The situation is that a stabilisation scheme based on price does not address itself to the major cause of income instability in the dried vine fruits industry. That major cause of instability, of course, is fluctuating output. Studies carried out by the IAC showed that between the period of, I think, 1946 to 1972, 78 per cent of the total variability in gross returns for dried vine fruits could be attributed to changes in export quantities available. I do not quite understand what the honourable member for Wakefield was getting at when he spoke about locking people into the industry.

Mr BARRY JONES:
LALOR, VICTORIA · ALP

– Locking them into poverty.

Mr KERIN:

– Locking them into poverty. I think that the smaller farm will go broke and there are many small farms.

Mr Giles:

– I also meant locking them into the enterprise. It is a long term investment.

Mr KERIN:

– I accept that. The honourable member for Wakefield says that it locks them into the enterprise. That is why I particularly support the second part of the LAC recommendations with respect to really being serious about adjusting the industry by implementing the full provisions of the fruit growing reconstruction report which the IAC brought down. It suggested the development of Area Redevelopment Authorities, counselling, concessional adjustment finance and assistance for the removal of vines through the industry, particularly in the South Australian Riverland as well as in some areas where there are very small blocks, such as Sunraysia. That is my only criticism of the Bill. The Opposition has agreed to go along with the traditional stabilisation scheme even though the honourable member for Parramatta and I have expressed some doubts about it. My worry is that it is just a bit more of the same. Nothing is looked at in relation to the long term future of this industry.

It is very pleasing to note that we have another two years of good export prices. When the IAC wrote that report it was not really aware of the future- that future is now when compared with quite a while ago when the IAC report was written- but I think one can realise, given the normal run of events, that not only has the industry changed since the IAC wrote that report but also by the early 1980s the industry will be again under pressure and in difficulty. I think one of the pleasing things is that some of the dried vine fruit growers themselves realise that they are now inextricably linked and worked in with the wine grape industry. Rather than call the industry the dried vine fruits industry, it is probably more appropriate to call it the multi-purpose grapes industry. It is encouraging to see that many growers, even in a period of high prices, now regard the contracts with the wineries as something to be held on to because they see this as the longer term future for the growing of these multipurpose grapes.

There is not much heat in this debate. I think it has all been set out clearly. We are now making statutory what was formerly voluntary. We are setting up the Australian Dried Fruits Corporation to replace the Australian Dried Fruits Control Board. The principles are well known and they are well supported in the industry. Honourable members most closely associated with dried vine fruits growing- the honourable member for Riverina (Mr Fitzpatrick) who made an excellent speech and the honourable member for Mallee (Mr Fisher)- have expressed very clearly the attitudes of the growers in their electorates and what the Australian Dried Vine Fruits Board has been able to negotiate. I stress this whole problem of production and how production is characterised by large annual fluctuations.

The most recently published information by the Bureau of Agricultural Economics at the farm level stated that the production varied over a one-year period from 128.1 tonnes to 138.9 tonnes; from 131 tonnes per farm in Victoria to only 36 tonnes per farm in South Australia. South Australia by and large is where the amounts are the smallest. When we have an industry that fluctuates in production due to the weather and even in a good year only produces 36 tonnes, one can see how quickly it will get into trouble. Of course the yields per harvested hectare also vary greatly. For example, the yields in the most recently published information vary from 1S.S tonnes to 8.1 tonnes to 4.3 tonnes per hectare respectively for sultanas, currants and raisins. For example, sultana yields varied between 18.6 tonnes per hectare in New South

Wales down to 1 1.1 tonnes per hectare in South Australia. Not only are there variations in production through the years but also in yields per hectare which vary from State to State.

If we look at the total production figures for 1972, which was the top year of production of dried vine fruits, we will find that the total production was 550 kilotonnes- I suppose that is 1,000 tonnes. Production went down during 1973-74 to something less than 300 kilotonnes In 1 978 it went up to slightly over 400 kilotonnes The total production of all grapes in the present year is something like 800 kilotonnes and the crop for the coming year is estimated to be at about that level, giving an estimated aggregate value of about $135m. But the grape surplus at present is calculated to be 75 kilotonnes, including the 30 kilotonnes left on the vines. So we have a potential for over-production in addition to this problem of fluctuating production. Again, some regions are affected by this situation much worse than others.

Another problem causing more instability at present arises from the fact that the Government in the 1978-79 Budget has increased the excise rates on brandy by 84 per cent to something like $18.75 per Lal. In the light of that fact it is quite certain that brandy consumption will fall to disastrous levels. As I have said, dried vine fruit production itself is expected in 1979 to be in excess of 70 kilotonnes dry weight but final production levels in the months ahead will be sensitive to climatic influences. Production in 1978 at the dry weight level is 69 kilotonnes including some 700 tonnes of shiraz grapes. This production level is about 10 per cent higher than the production level for 1977 despite the substantial storm damage suffered in the Red Cliffs area in north western Victoria. Dried vine fruits gross value is projected to be about 15 per cent higher in 1979, at around $65m. The domestic market for dried vine fruit is expected to remain fairly static but exports in 1979 are estimated to rise by about 15 per cent to about 40 kilotonnes. Gross value of exports is expected to rise by 30 per cent to about $45m reflecting the expected higher export prices about which I was speaking a moment ago.

A feature of multi-purpose grape production is the extent of market diversion. Again relying on the most recently available published information, I understand that three-quarters of the production of raisins in 1973-74 and 1974-75 was delivered to wineries and in South Australia, for example, some 91 per cent of the raisin crop was sold to wineries. Sultanas are increasingly being diverted into wine grape production, I think particularly in the Robinvale area of Victoria. If we look at the figures for the year ahead with respect to exports we will see that the dried vine fruit export price and demand are expected to be strong following below normal world stocks and production in the northern hemisphere. As mentioned by other honourable members, an important factor in this regard is the extensive storm damage which has occurred this year to the Californian crop. Export prices for dried vine fruit are expected to rise by 15 per cent or more. Significantly, the American shortfall may enable Australian exporters to gain a foothold in traditional markets for United States dried vine fruit, such as Japan. What I have been saying is that the year ahead looks good for dried vine fruit but the long term future of the industry does not look so good.

As I said at the outset, whilst basically agreeing with the honourable member for Wakefield, we have to look to the long term future of this industry. We hope, as he hopes, that the Corporation can address itself to some of these longer range concerns to try to make more accurate market predictions. But I think particularly in relation to horticultural crops we simply cannot do that to any degree of certainty. There is no sense in making commodity projections when an overnight frost or hail-storm can wreck the whole crop. The reason why the IAC recommended against such a stabilisation scheme is that it believes that price stability is not central to the problems of the DVF industry. It believes that stabilisation policy would be better directed towards protecting growers against instability of production.

Crop insurance was nominated by a number of witnesses as the most effective measure to offset the effect of adverse weather conditions on yields and growers’ incomes. I believe that these insurance schemes are well intentioned, but again with an industry such as horticulture I frankly do not see them working in anywhere near the same way they can work for other commodities. I do not see them working anywhere near as well as, for example, the State wheat board in Queensland works its scheme for wheat. I will not delay the House any longer other than to say that, although I think the IAC’s recommendations are a little out of date and although I think the Government and the industry itself believe a continuation of stabilisation type measures is the best policy in the short term, the long term future of this industry with respect not only to fluctuating production but also to over-production will mean different measures will have to be taken in the future.

Question resolved in the affirmative. Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr McLeay) read a third time.

page 3324

DRIED VINE FRUITS EQUALIZATION LEVY BILL 1978

Second Reading

Consideration resumed from IS November, on motion by Mr Sinclair:

That the Bill be now read a second time.

Question resolved in the affirmative. Bill read a second time.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr McLeay) read a third time.

page 3324

DRIED VINE FRUITS EQUALIZATION BILL 1978

Second Reading

Consideration resumed from IS November, on motion by Mr Sinclair:

That the Bill be now read a second time. Question resolved in the affirmative. Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr McLeay) read a third time.

page 3324

DRIED FRUITS EXPORT CHARGES AMENDMENT BILL 1978

Second Reading

Consideration resumed from IS November, on motion by Mr Sinclair:

That the Bill be now read a second time.

Question resolved in the affirmative. Bill read a second time.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr McLeay) read a third time.

page 3324

NATIONAL HEALTH AMENDMENT BILL (No. 3) 1978

Second Reading

Debate resumed from 17 November, on motion by Mr Hunt:

That the Bill be now read a second time.

Dr KLUGMAN:
Prospect

-The Bill we are debating today is in a sense a panic measure introduced into this House following the exposure of the shortcomings of the new scheme which came into being on 1 November. I make it clear at this early stage in the debate that the Opposition does not oppose the legislation. On 1 November the Minister for Health (Mr Hunt) gave the following advice to prospective health insurance contributors:

The best advice I can give is that people should check the offers being made by the funds before signing up.

Many people around Australia will be wondering why the Minister himself did not take his own advice and check the offers of the funds- the tables in conjunction with the rules- before approving the new rates. We all welcome legislation, however limited, which gives the Minister power to direct the funds not to discriminate against a particular group of contributors. I emphasise, however, that the Minister should not have approved fund tables which cannot conceivably be studied without reference to the rules in the first place. In view of his laxity only a month ago, can we expect the Minister to employ the powers given to him under this new legislation? The legislation would have been unnecessary if the Government had not been in such a hurry to change health insurance arrangements. On 9 November the Sydney Morning Herald commented:

As has happened so many times before, it has failed to think through all the implications of its changes. There is, for instance, an extraordinary conflict of opinion between Mr Hunt and the HCF about whether its rules- as distinct from its rates and contribution tables- were approved by him or his Department. It is difficult to reconcile the opposing statements.

The editorial continues:

Needless anxiety has been caused to an important group of health fund contributors, and the whole episode has been a very poor advertisement for the Government’s ability to handle, with even average competence, the fairly intricate arrangements involved in what is now voluntary health insurance.

I submit, however, that the ostrich mentality of the Minister was deliberate. In a circular in October to the registered health organisations from his own Department of Health the following stands out: ( 10.8) Minimum control will be exercised by the Department over the variation tables. Control will be limited to the financial viability of the tables and section 78 of the National Health Act will be amended to limit Commonwealth control to the approval of contribution rates in respect of the tables . . . ( 10.9) Organisations will be required to submit rules determined by organisations governing the provision of variations to basic benefits. With the exception of the rates of contribution these will not be subject to approval but will be for information purposes and, as necessary, to access the financial viability of the organisation.

I say in passing that I cannot see how the financial viability of an organisation can be assessed and its rates of contribution approved without knowledge of what the cover is, what the exclusion clauses are, how many consultations, pathological tests and so on the fund is prepared to pay for. Clearly, the Minister and the Department hope to minimise their supervision of the fund tables and rules. Again, I challenge anyone to deny that it is impossible to study fund rates without reference to the rules. The literature distributed by the funds stated in the summary bylaws that discretionary clauses could be employed. Unfortunately, one cannot expect every contributor to be conversant with the bylaws of a fund. However, one would have expected the Minister or his staff to have read them.

The Minister took a chance that no one would notice. However, encouraged by this attitude, the funds were determined to capitalise on it, and at least the Hospitals Contribution Fund had the decency to admit its intentions. As the Sydney Morning Herald noted, the whole affair quickly became ‘a chronic case of confusion’. The Minister reasoned that if he said he had not seen the fund’s rules he would not have to accept responsibility- the actions of a bureaucrat seeking to shift responsibility and not those of a responsible Minister. Mr Turner, the director of the HCF, responded to the Minister’s denial of having seen the rules: ‘He has got to be joking. ‘

The Minister persists in saying that the Government’s health insurance arrangements are working ‘exceptionally smoothly except for this group of people with chronic or pre-existing conditions’. I challenge whether the provisions for bulk billing for the disadvantaged are working smoothly. Around Australia deserving people are being denied bulk billing procedures. A part old age pensioner from Braddon in the

Australian Capital Territory has thrice been refused bulk billing by her specialist, despite the fact that her total income before deductions is less than one-third of the average wage. At the City Health Clinic she was actually informed that only refugees were disadvantaged and that all students, unemployed and part age pensioners would have to pay. This was at the City Health Clinic run by the Minister’s own Department in the Australian Capital Teritory. The disadvantaged under this Government increase every day. We have got the problem at the present time in New South Wales and in other States- the Minister tried to imply that it was only the case in New South Wales when replying the other day to a question from the honourable member for Grayndler (Mr Stewart)- that country doctors working in country hospitals are threatening to strike as from 1 December, the end of this month, because of the Minister’s indication to the States that he will accept only a 75 per cent modified doctor’s fee as part of his cost-sharing with the States.

Mr Hunt:

– That is a lie. I am sorry, but it is not the truth.

Dr KLUGMAN:

– That is the indication the Minister gave to the States.

Mr Hunt:

– I gave no such indication to the States whatsoever.

Dr KLUGMAN:

-Now the Minister says, and I am pleased to hear it, that apparently he will pay whatever the States negotiate.

Mr Hunt:

– It is up to the States to negotiate with the doctors, and those negotiations are taking place under our hospitals agreement.

Dr KLUGMAN:

– So no matter what kind of agreement the States come to with the doctors, apparently now the Federal Government- I am pleased to hear the Minister say it- will pick up 50 per cent of the cost under the cost-sharing agreement. The unfortunate thing about the present situation is that many people in the community have been led to believe that this legislation has now covered them, despite chronic or pre-existing conditions, at the level of hospital or medical benefits for which they insured. Of course, that is not the case, and many will find it out in the near future. Many people are thinking of the Minister’s words following public reaction to the now notorious HCF letter, and I quote from the Minister’s statement:

I now put all health funds on notice that the Government could take fresh determinations to withdraw their right to reject contributors with chronic illness to any table.

For contributors to high insurance tables who are facing high hospital costs for a chronic condition, this legislation is hardly encouraging. We are frequently told by the Government, the private funds and the Australian Medical Association that a greater direct contribution by the patient is necessary to ensure more frugal use of medical services. It is generally implied that our economic system may collapse if the fee or a substantial part of it is not paid at the point of service. The same sources that attack Medibank for contravention of this holy principle, however, are now exhorting the public in favour of indiscriminately taking out private gap medical insurance. Indeed, the young and the healthy have been urged to contribute to 100 per cent medical cover in order to maximise the profits of the funds. It depresses me that the Minister has become part of the clique employed by the funds to get them unnecessary contributions. He did not start off that way, but suddenly for some reason during this controversy he has joined that group.

My own views on insurance are well known to this House. People tend to over-insure. On 2 November, in a rare moment of clarity, the Minister advised that people should not waste money paying for an insurance cover they may not be entitled to under the rules of their fund. That advice still applies. Those with chronic conditions can still be left with insurance which they bought, in a sense, in a poke. The unfortunate thing is that many people, thinking that the legislation prevents funds reducing benefit levels for chronic or pre-existing conditions, will find this to be the case too late. More than ever, when it is important that Australians understand the health insurance system because of the number of options available, they are confused, insecure, and likely to be coerced into taking out unnecessary insurance. Under this legislation, improper discrimination by a fund against a contributor must now be brought to the Minister’s attention. It is a time-consuming process for a worried contributor facing high medical and hospital costs. What does the Minister intend to do with the funds which discriminate against those over 65 years of age and refuse to insure them? Under the new rules on improper discrimination, is the Minister going to insist that the fund insure people over 65 years of age?

If he does, obviously, the funds will have to increase their contribution rates. What does the Minister intend to do with the Australian Union of Students Friendly Society, which has different rates for people under 31 years of age and those over 31 years of age; and with the Hospital Contribution Fund of Australia, whose Selectaplan discriminates against pregnant women, who are not covered by this plan.

Most importantly, how is the average contributor to be made aware of his rights to appeal to the Minister to direct the funds? Clearly, the pamphlet issued by the Department of Health informing people of the new 1 November arrangements proved a dismal failure, confusing more than it enlightened. It would be interesting to know how much Johnathon Gaul, consultant to the Liberal Party of Australia, was paid for this leaflet. Contributors want to know how they stand and no one is telling them adequately. Under this legislation the medical benefit to the contributor cannot be reduced below 75 per cent of the common fee, but it can still be reduced from 100 per cent to 75 per cent unless the Minister directs otherwise. When people talk about a 75 per cent refund from a health fund all they are really talking about is a maximum of a 35 per cent refund because the Government pays a 40 per cent refund in any case. In cases where the common fee for the service is greater than $33-odd the Government in fact pays more than 40 per cent. So the funds only insure people for less than 35 per cent of the common fee.

The hospital benefit cannot be reduced below the basic table for contributors but can still be reduced from higher tables. If a contributor’s membership has been cancelled, the contributor, believing there to have been improper discrimination, can ask the Minister to direct the fund concerned to reinstate him without loss of entitlement. One important point of the legislation is that the Minister will have the power to prevent discrimination against hospital benefits contributors where the discrimination, on or after 1 May, is related to the question of whether, having regard to a person’s medical condition, hospitalisation is necessary, desirable or appropriate. Most honourable members have heard that some of the funds have decided that they will not pay for hospitalisation for their contributors because they do not consider hospitalisation to be ‘appropriate’, whatever that might mean. Clearly the Minister’s powers of discretion will be wide. I hope that the Minister will be willing to use this power. He certainly was dismissive of his power not to approve fund tables prior to 1 November.

The effectiveness of this legislation will depend to a great extent on contributors knowing their entitlements and what action they can take. I am well aware that the funds are not in the business for their contributors’ health. However, on this rare occasion I agree with the comment of Roger Bush- I do not know whether he is still a reverend- which was published in the Sydney Sun on 10 November. The article states:

It might be a far better thing if rather than touting for new business with advertisements the funds set out in laymen’s language, exactly how the funds are managed and handled.

It is doubtful that the funds will openly inform contributors of their new status under this legislation. I suspect, however, that the deliberately created confusion by the funds, the Australian Medical Association and the Government will eventually rebound on them. Indications are that this is happening, with the number of people who apparently are registering with Medibank Private to receive the Government refund only. By making this legislation retrospective, the Government has tried to minimise its embarrassment. Its ineptness in health insurance policy formulation, however, has been brought home clearly to all Australians. I again ask the Minister to implement the legislation for contributor representation on the boards of private funds that he promised in February 1976. These representatives might prove more generous towards their fellow contributors. I also ask the Government to take the advice of the AMA, which is as follows:

It’s time we sat back and had a calmer look at what’s going on.

On 24 May this year, when discussing the paper which I think was prepared by Dr Sax, the Minister said:

Until an improved data base becomes available the Government believes that it would be premature to proceed further with the consideration of major adjustments to the Health Insurance system.

The new arrangements were not just premature; they were stillborn and cannot be resuscitated by these sorts of ad hoc adjustments. It is no longer a joke that people should receive rebates for nervous disorders brought on by trying to understand the new arrangements of 1 November. Perhaps Government members, especially the Minister, also require such a rebate. No significant new data has become available since 24 May. Certainly none came to the notice of the Minister between 24 May, when he said what he did, and IS or 16 August, when the changes were introduced. What has been happening is quite ridiculous. I hope that the Minister and the Government will agree to the motion which I will move at the end of the second reading debate, which will seek to refer this legislation to a legislation committee. Legislation committees have been set up for this purpose.

Already masses of amendments have been made to die National Health Act. If I remember correctly, part of the legislation with which we are now dealing relates to one section of that Act, section 73, and seeks to insert a new section, section 73BFB. Honourable members wil know just how many amendments this implies. We started off with section 73a, then we added section 73b and have gone right down to section 73z. Then, after section 73B, we inserted 73BA, 73BB et cetera. We got down to section 73BF, then we inserted section 73bfa, and now we are inserting section 73BFB. I will check this before I move my motion seeking to refer this Bill to a legislation committee, but of the order of a dozen amendments have been made to that section of the Act since this Government came into power. Since 1976 about a dozen amendments have been made to a single section of the National Health Act.

I hope that the Minister, in his calmer and less political moments, will agree with me that this is not the way to run legislation. The National Health Act- this Bill seeks to amend it, so I will refer to it in general- ought to be amended significantly. Probably it ought to be divided into a number of parts, each dealing with health insurance, nursing homes, hospitals, pharmaceutical benefits, et cetera. It is quite ridiculous to have all those areas covered by one Act, to have a huge Act and to have masses of amendments to it. When one asks for a copy of the Act from the Table Office one is never quite sure whether all the amendments have been included in the copy one receives or what we are really doing with the Act that is in force at any particular time.

I make a couple of additional points which deal with the National Health Act but do not relate specifically to the amendments contained in this Bill, although maybe they should have been included in the Bill. One point is that at least some of the funds are transferring contributors to a higher scale and are getting the contributors’ paymasters to make the transfer without the agreement of the contributors. In fact, the contributor has to contract out of the transfer. I do not think that that is fair. I think that it should be quite clearly stated that if there is to be a transfer to any sort of higher scale the contributor ought to have to contract in rather than contract out.

Another point is that it has been brought to my attention that the Medical Benefits Fund of Australia Ltd has refused payment of a refund under one of the ‘extra’ tables on an account because the account was paid after the person concerned had become unfinancial with the fund. The actual service was rendered when the person was a financial member of the fund. I would certainly argue that that person is entitled to a refund because at the time the service was givenwhen the debt was incurred- the person was financial with the Medical Benefits Fund. That person has now been refused a refund because the bill concerned was not paid until 2

November, which was two days after the cover had expired. It is quite ridiculous that this should be done.

Finally, I re-emphasise a point that might well have saved the Minister a lot of embarrassment that he suffered because of the procedures adopted by the Hospitals Contribution Fund of Australia. I emphasise again that that was not the only fund which introduced the limits to which we now refer as ‘unfair discrimination’. The Minister promised me in February 1976, soon after he became Minister for Health, that he would look at the possibility- obviously with the hope that he would be able to do something about it- of bringing contributor representatives on to the boards of these funds such as the Medical Benefits Fund in New South Wales, the Hospitals Contribution Fund in New South Wales and a number of other funds. He made that promise. I understand that he set up an interdepartmental committee to deal with the matter. Nothing has happened. The contributors to those funds have no representation on their boards. I noted that the Hospital Benefits Association in Victoria has at least a small number of contributor representatives on the board. That is a step in the right direction. I appeal to the Minister to look at the matter again. Maybe that rather heartless letter from the Hospitals Contribution Fund of Australia would not have been sent out if some contributor representatives had been sitting on that board. I realise that it would not have altered the net result. Maybe the situation would have been worse. Perhaps the attention of the Minister might not have been drawn to what was going on. At least it could have been done in a more genteel or gentle manner as far as the contributors are concerned.

As I said earlier, the Opposition is not opposing the legislation. We believe that the Minister ought to have the powers which are being given to him under this amending legislation. We will certainly chase up the Minister if he does not use the powers given to him under this amending legislation. I make a final appeal to him to try to persuade the Whip or the Leader of the House (Mr Sinclair) to allow this legislation to go before a Legislation Committee so that some intelligent cross-examination of the officers of the Department can be conducted in order to find out just exactly what it means. In order to save discussion during the Committee stage I wish to draw the attention of the Minister to clause 3. It reads:

  1. . ‘improper discrimination’ means a discrimination that is related to all or any of the following matters:

    1. the suffering by a person from a chronic disease, illness or other medical condition or from a disease, illness or medical condition of a particular kind.

Does that mean that the funds will not be able to exclude those people if the Minister thinks they should not be excluded? After all, they are defined as being people against whom improper discrimination is practised. Does it mean that the funds will not be able to contract out, for example, for cosmetic surgery, for terminations of pregnancies and for all kinds of things because they are obviously medical conditions, diseases or illnesses of a particular kind? When the Minister replies at the end of the second reading debate he might give us some response to that matter.

Mr Hunt:

– That is in respect of cosmetic surgery?

Dr KLUGMAN:

– All kinds.

Mr LLOYD:
Murray

-The National Health Amendment Bill (No. 3) 1978 has the quite specific purpose of closing loopholes discovered by a certain health fund, particularly in relation to new optional deduction medical benefit tables which, of course, were a part of or one of the innovations of National Health Amendment Bill (No. 2) which commenced operation on 1 November. To a lesser extent the purpose of the Bill is to deal with an earlier problem which arose in relation to hospital and /or nursing home bed declaration. These amendments are really about the problem of chronic illness or, as I am advised by the Minister for Health (Mr Hunt), chronicity. I do not think I will use that word again. I will refer to chronic illness. The Minister assures me that the word appears in Webster’s dictionary and in the Oxford dictionary and that it is quite correct. Apparently it means the problem of illness basically of old people.

Of course, the percentage of such people is increasing in our community and therefore it presents an increasing problem in relation to health care. One can question whether changes to our health insurance policies will be required in the future to overcome the problem of insurance arrangements and health care arrangements for those people who are suffering from chronic illness. How appropriate is the insurance principle for the care of people with a chronic illness? On the one hand, we have the problem of maintaining equity for old people and the ability for them to obtain health care, whether it be hospital or medical, without discrimination. Yet, on the other hand, we have to allow flexibility for the health funds in their insurance arrangements.

This problem of chronic illness and the insurance principle is not just confined to the medical section. That is so because of the increased usage of medical services- visits to general practitioners and so on- by old people. It is concerned also with the question of acute hospital beds and /or geriatric ward beds in hospitals and nursing homes. I understand that in the near future a decision will be reached and announcements will be made by Federal and State authorities on the question of the closing down of wards in larger hospitals, perhaps reclassifying some of the present acute wards as geriatric or nursing home wards, and the reclassifying of patients in smaller hospitals- country areasfrom acute patients to nursing home patients.

There is also the problem of the capacity, or perhaps the over-capacity, of hospital beds generally. Already this year the Australian Hospitals Association has stated that it believes that there should be a reduction in the number of acute hospital beds in Australia. I think I am right in saying that the Australian Medical Association supports that particular viewpoint. I know that the Minister has stated this particular point of view. Mr Minister I am referring to this problem of the over-capacity of hospital beds generally in Australia which is an additional argument to the question of whether some of the wards should be reclassified as geriatric wards or nursing home wards or whether perhaps there should be a reclassification of certain patients. I understand that measures are under way which will do something about this situation in the public hospital sector.

We have the problem of private hospitals not being subject, as I understand it, to ministerial direction and, of course, government funding. Recently, the Hospitals Corporation of America stated that it would invest millions of dollars in the creation of new private hospital beds in Australia- several hundred, in fact. It has made this announcement at a time when we are saying that there are already too many hospital beds in this country and that in the public sector certain restrictions and disciplines are required. According to the Press statements made by this Corporation its sole purpose in providing those hospital beds is to make a profit of the order of 17 per cent to 20 per cent. I am not against profit making, but one can ask in the context of hospital care in this country: At whose expense is profit gained? I suggest very strongly that it is basically at the expense of the Government and the taxpayer. I hope that the Minister is able, either under his own powers or in discussion with the States, to do something about what we will call an overall rationalisation of hospital beds in this country, whether they be acute or chronic. His efforts should not just be restricted to the public sector. We should not allow, as I believe has happened in the United States of America, a restriction on the one hand of the public sector and at the same time a proliferation of beds in the private sector.

This Bill restricts the ability of a fund to defeat the spirit of the new health scheme. I believe that the Minister has introduced these amendments with some sadness because they are contrary to his philosophy and the Government’s philosophy espoused in the 1 November changes, namely, to provide more flexibility and freedom for the health funds to go about their business. We see that the purpose of this Bill is to impose more specific regulations, because one fund out of approximately 80 in Australia has tried to flout the spirit of the health insurance system. So these amendments are necessary to protect the insured person.

I congratulate the Minister, firstly, on the speed of his response to the problem. As the scheme commenced only on 1 November and as we are still in the month of November, that is not a bad achievement in the bureaucratic world that reigns here in Canberra. One can argue that it was probably also necessary for speed because this is now the second last day of the sittings of the Parliament. Nevertheless, I think the Minister is to be commended for his ability to introduce the legislation now rather than to make announcements and at a later date to introduce legislation backdating everything from the autumn session. I commend the Minister secondly on the degree of explanation that is provided in his second reading speech. I believe that it is one of the best second reading speeches I have read in that it details quite clearly, step by step, the points raised in the amendments.

The third area of commendation is the way in which the Minister has allowed, even though he could have retained power over interpretation and declaration in these amendments, for parliamentary scrutiny and parliamentary disallowance. He does that on two occasions in the amendments, and in another part of the legislation he allows appeals to be made to the Administrative Appeals Tribunal in relation to any declaration or decision he may make. That is something that cannot be said of all legislation and all Ministers in this place, that they are willingly allowing a greater role for the scrutiny by this Parliament of their actions. The second reading speech which details or explains the amendments contained in this BUI makes four points: Firstly, protection from improper discrimination by a fund to cover chronic illness, age, limitation on frequency of services, etc; secondly, to protect subscribers in both the pre- and post- 1 November situation from rule changes made by medical benefit organisations; thirdly, protection from reduction below the 75 per cent level by any fund; fourthly, protection from arbitrary reclassification of the patient from a hospital to a nursing home situation. Then, of course, follow the disallowance provisions.

I would support the honourable member for Prospect (Dr Klugman) in one of the comments that he made towards the end of his speech, that is, that there is a great need to consolidate the National Health Act. With so many amendments and loose sheets of paper, as he said, it is an impossibility for an ordinary person, such as a backbencher, to follow it through quickly and clearly. He also made the point that it may be of advantage to provide in different volumes the medical section and the pharmaceutical benefits section. That point would also be worthy of consideration. I commend the Minister and support the BUI.

Mr Les McMAHON (Sydney) (5.26)-I agree with my colleague the honourable member for Prospect (Dr Klugman) who said that the Opposition does not oppose the National Health Amendment Bill (No. 3) 1978 which will amend the National Health Act 1953. But Opposition members disagree with the way in which the Minister for Health (Mr Hunt) has carried out his job in putting this Bill together. The honourable member for Murray (Mr Lloyd) congratulated the Minister but we in the Opposition criticise the Minister for the way in which he has carried out his job in having to amend the National Health Act. The people of Australia, particularly the people of New South Wales, wonder how long it will be before another amendment is introduced? The Opposition welcomes the Government’s moves to remove some of the discriminatory practices which exist in the area of health insurance. Of course, these practices would not have been developed if the Government had honoured its election promise to maintain Medibank as it was introduced by the Labor Government.

The Government dismantled Medibank, supposedly in the interests of reducing the total amount that was being spent by Australians on health care. It was of the opinion that because Australians were entitled to health care as of right, and not as of means, they were seeing their doctors far too often. It determined that a disincentive was needed to discourage this alleged over-use of medical services. The disincentive was to shift the burden of payment more towards the patient and away from the insurance fund, whether it be public or private, so that the patient would pay more and accordingly would buy less. Naturally the process did not work for two fundamental reasons which forever seem to be beyond the grasp of this Government. Firstly, the alleged over-use of medical services arising from the introduction of Medibank is a myth. The Government is unable to produce any statistics to show that this is true. Of course the number of persons who were obtaining health services under Medibank had increased, but this was the reason for the introduction of Medibank- to bring basic health care within the reach of every Australian. Secondly, the only effect of the Government’s strategy is to force more people out of the health insurance system. As benefits have dropped, more people are opting out of taking health insurance because it is more economical for them to bear their own health costs.

Let me provide an example. In New South Wales the present schedule fee for a general practitioner consultation is $8.90. After 8 p.m. or on weekends it goes up to $24. The premium for basic medical cover is about $1.60 a week for a single person. For that person to break even with his insurance costs he would need to visit a general practitioner 26 times a year. It would be very unusual for a healthy young person to visit a doctor more than six times per annum. Thus, by not taking health insurance, that person would save $64.48 a year. The result of the Government’s strategy is to force the healthy people out of the insurance system and leave only those people who expect very high health bills, that is, the aged and the chronically ill. The result will be that insurance premiums for these people will rise. This is discrimination which the present Bill will not remove.

The Government, if it wishes to reduce the total health bill, will do better to identify and inquire into the three main areas of health costs, that is, hospital and medical charges and administration costs. The 1977 report of the Health Insurance Commission indicated that the area of administration costs is quite vulnerable. The report disclosed that administration costs of Medibank Standard were only 4.2 per cent of benefits paid, whereas those of Medibank Private were 15.7 per cent, a figure that is comparable with the other private funds. The substantial difference can be attributed to a number of factors, two important ones being bulk billing and the greater volume of claims that were handled. The figures indicate that substantial economies can be obtained by channelling claims through one administrative force and by eliminating the middle man. The Minister might take note that these two aspects- the high cost of administration and the falling numbers of insured personswill combine to cause the demise of some private insurance funds within 12 months.

Other aspects of discrimination have arisen out of the present scheme. For example, the Hospitals Contribution Fund of Australia offers a type of insurance that is called ‘budget cover’. To obtain this cover one must be a fit and healthy person because no pre-existing or chronic conditions are covered. If one becomes ill and requires more than 12 consultations a year, the level of the cover drops down automatically. This type of insurance effectively requires those persons who are in need of health insurance to pay more for the same benefits. For those people who were covered originally, when they are in dire need of assistance the level of aid drops. Surely this is discrimination. But we cannot solely blame the funds for introducing this sort of cover because it merely reflects the rationale that was introduced and encouraged by the Government- the principle of optional deductibles. Its purpose is to discriminate between those people who are ill and those people who are healthy. It is a wholly inappropriate concept.

Health insurance is not comparable with motor vehicle insurance. There is a very large element of personal control and individual responsibility in operating a motor vehicle. That is not so with one’s health. Good health is fortuitous and those people who are unlucky enough to become ill should be assisted by the remainder of the people. This could be classed as socialism a Christian way of life or helping one’s fellow countrymen. The Liberal Party of Australia and the National Country Party have rejected their supporters on this issue. Discrimination is also possible because doctors have the capacity to bulk bill but they are not required to do so. Take the glaring example of the new concept of socially disadvantaged persons. These questions have all been asked before: Who determines who are socially disadvantaged persons? What criteria are used to determine whether persons are sufficiently socially disadvantaged? Leaving such a decision in the hands of doctors, with no possibility of adequate review, is opening a Pandora ‘s Box of discriminatory possibilities on the basis of race, creed, colour, age and sex. A further discriminatory aspect of bulk billing arises in relation to pensioners holding pensioner health benefit cards. As I said before, doctors have the capacity to bulk bill but they are not required to do so. In fact one of their unions, the Australian Medical Association, in its 1978 policy statement, emphatically advises against it. Paragraph 106 of the statement states:

The Australian Medical Association is opposed to direct billing of health insurance organisations and advises members not to accept assignment of benefits.

Thus some doctors at least W111 not bulk bill. Some pensioners will therefore have to pay thendoctors and then recover their insurance benefits from a fund. A doctor’s bill of $8.90 out of a pension of $53.20 a week is a hefty sum to have to fork out. It is worse still if a pensioner is referred to a specialist who does not bulk bill. About half of a week’s pension may disappear in the payment of a specialist ‘s fee. It is said that doctors on the whole are compassionate towards pensioners and that the same union, the Australian Medical Association, recommends that doctors subsidise pensioners. But they are not required to do so. Pensioners on substantially equal bases will be treated differently to the unnecessary detriment of some of them. There is a chilling rider to the AMA’s recommendation to subsidise pensioners in the statement referred to earlier. It states:

This attitude could change if the number of Health Benefit Card holders was increased without consultation.

The union is obviously concerned that too many patients will become subsidised and, therefore, cause a drop in doctors’ incomes. That does not augur well for the broad definition of the socially disadvantaged. After all, doctors receive only 75 per cent, not 85 per cent, if they classify a patient as socially disadvantaged. They forgo their right to recover the remaining 25 per cent. There is nothing to prevent them recovering the remaining 15 per cent when pensioners are charged.

These inequities ought to be removed forthwith. Doctors should be required to bulk bill all pensioners holding PHB cards so that equitable conditions apply to all such persons. In addition, the 85 per cent should be all that can be recovered. Pensioners should not be required to contribute to health costs. Again, the HCF- I am not really picking on that fund; it is just that it is so vulnerable to criticism- has a policy of requiring contributions six months in advance for its Plan 61, hospital-only insurance. For pensioners holding PHB cards such a requirement is disgraceful. To have their choice of doctor in hospital single people are required to pay out in a lump sum $52.02, or a week’s pension and married pensioners are required to pay twice that amount to obtain family cover. A married pensioner has to pay $ 100 six months in advance.

I refer the Minister for Health who is at the table to a statement that I made in the Sunday Telegraph of 29 October 1978. Constituents of mine at Petersham, Mr Clem Cowell and his wife, Gwen, made inquiries of me. They had to pay health insurance contributions to HCF six months in advance. They had contributed to the fund for over 50 years. Under the new rules from 1 November they have pulled out of the HCF after contributing in advance for 50 years. I am pleased to say that they have joined Medibank. I had to send a telegram to the Minister for Health about the matter. On 7 November he replied to me. He said:

Dear Mr McMahon,

Thank you for your telegram of 30 October 1978 which brought to my attention the fact that the HCF are apparently requiring some contributors to pay contributions for a minimum period of six months in advance.

The HCF have submitted for approval the following new rule- 2.1.4. Weekly contributions are available only for group contributors. Monthly and quarterly contributions are not available to non-group contributors if the weekly contribution rates payable for the combinations of tables insured by the contributor are less than $5.00 at the family rate or $2.50 at the single rate ‘.

The explanation forwarded with the proposed rule was that it ‘ensures that the rninimum cash payment under any HCF plan is reasonable in relation to the commission rates payable and the cost of processing the receipt. ‘

Consideration will be given to rule 2.1.4. at the same time as the other proposed HCF rule changes are considered. The effect that the rule would have on persons with restricted means will of course be taken into account.

Kind regards, (Ralph J. Hunt)

I hope that the Minister for Health will take note of my comments and try to help those people. Pensioners have to pay six months in advance. Many of them have to be bulk billed. Because they are old fashioned in their attitudes, they are insuring themselves. As I said earlier, young people are opting out. Pensioners are losing on the deal.

Mr Hunt:

– Can they not join Medibank Private?

Mr Les McMahon:
SYDNEY, NEW SOUTH WALES · ALP

– They can but how much does Medibank Private cost? They are paying almost $18 a month now from their pensions. Under the new rules they can go into a public hospital. If they have a pensioner health benefit card they are entitled to register themselves for the Commonwealth benefit and receive free consultations. Approximately 30 per cent of constituents in my electorate are pensioners. Although many people who are sick or who have families have to take out health insurance personally, I believe that it would be better for a pensioner to go into a public hospital although he would not have his choice of doctor. He would then be bulk billed. I had reservations but now I believe that by opting out of health insurance pensioners will get a better deal without spending a minimum of $ 1 8 per month.

I have disagreed with the AMA. An article in the Australian of 14 November states:

The Australian Medical Association has made an urgent plea to federal authorities for an immediate 20 per cent cut in next year’s medical student intake . . .

The AMA fears that more doctors, especially in metropolitan areas where there is an over supply, would increase competition for patients and lead to an escalation in health costs and a decline in medical standards.

It is worried too, that Australia, with its ‘unsatiable demand for medical care’, is prepared to accept more doctors than it needs . . .

We believe a 20 per cent reduction in medical school intake now is a sensible step and it’s not going to cause a sudden shortage considering, the long lead time of six years-

The AMA is again interfering in the actions of this Government. According to a survey taken in Australia in the last 12 months a doctor earns a minimum of approximately $70,000 a year. If the unions took action because of this, the Trade Practices Act would be invoked forthwith. The honourable member for Grayndler (Mr Stewart) asked questions about the medical profession during the adjournment debate last week. Medical students in future will not be able to get jobs. They will not have a chance to work in hospitals for the compulsory period of 12 months. The AMA is dictating to the Government. I know that the Minister for Health is sympathetic. Many times I have referred to him the cases of people in my area and he has been worried about them. But I am perturbed that the Prime Minister (Mr Malcolm Fraser) is stepping on his toes and telling him how to run his Ministry. The Government has almost killed Medibank. I think that the AMA is interfering in government decisions. It has not given an opinion about HCF or whether people should take out insurance. It has not attempted to look after people. I hope the Minister will note my comments relating to the underprivileged.

Another case to which I refer is a young girl who is a single parent. She had to pay $ 1 8 in cash to a doctor in my electorate. He asked her for the money at the time of the service. She had only $ 1 8 in the flat in which she was living. So there is injustice taking place through some in the medical profession. I wish we could have a full inquiry of the whole health scheme in Australia, as the Minister for Health (Mr Hunt) did state in answer to the honourable member for Grayndler (Mr Stewart).

Debate interrupted.

page 3333

QUESTION

RULE RELATING TO DEBATE: RULING ON INTERPRETATION

Mr SPEAKER:

– On a recent occasion my ruling on the interpretation of the rule relating to debate on the conduct of a Minister has been the subject of a motion of dissent moved by the Leader of the Opposition (Mr Hayden). The House upheld my ruling. The Leader of the Opposition in dissenting from my ruling on a separate and later occasion accused me of being biased. The words he used were most offensive to me. I did not require their withdrawal even though I would have done so if used against any other member.

I remind the House that Standing Orders and long established practices regulate the manner of debate on these matters. I will state them clearly to the House so that there can be no doubt about their meaning and intent. First, Standing Order 142 provides that a question may be put to a Minister relating to public affairs with which he is officially connected or to any matter of administration for which he is responsible. May’s Parliamentary Practice, page 331, which this House uses as a guide, further amplifies this rule by stating that a question may not be asked which deals with the action of a Minister for which he is not responsible to Parliament

Standing Order 153 states that questions shall not be asked which reflect on or are critical of the character or conduct of those persons whose conduct may be challenged only on a substantive motion. Among those persons are the Speaker, Chairman and members of both Houses of Parliament. I have not prevented honourable members from criticising a Minister or any other person. I have upheld the rules of the House so as to ensure that any criticism of a Minister or any other person takes place in the established parliamentary form for which there is a sound procedural reason. The precise rule is set out in May, pages 328 and 368. As recently as 19 June this year Mr Speaker Thomas in the United Kingdom House of Commons had cause to remind the House of the rule. He said:

On Thursday last, I caused the honourable member to withdraw a reflection on the conduct of a member. To clear up any lingering doubts about my reasons for doing so, I shall try to make the position absolutely clear.

The conduct of certain categories of persons may be criticised only in a substantive motion, of which due notice must be given.

It is not the case in Australia that due notice must be given. Mr Speaker Thomas continued:

Those categories include members of either House of Parliament. If such a motion is debated, the criticism embodied in the morion can, of course, be repeated in the course of the debate. The criticism can then be answered and the motion decided, if necessary on a vote. This procedure ensures fair play on all sides.

. Thus it is not in order, as Erskine May makes clear, for personal conduct to be criticised in a question.

This notice need not be given because there is a practice in this House often availed of, although I am not encouraging it, to suspend Standing Orders for the purpose of moving such a motion. If the House feels that the Standing Orders are inadequate and should be changed, it is open to any honourable member to take action to have them changed. While they stand in their present form it is my task to apply them to all proceedings in the House and I will not be influenced by pressures from any quarter.

page 3333

NATIONAL HEALTH AMENDMENT BILL (No. 3) 1978

Second Reading

Debate resumed.

Dr BLEWETT:
Bonython

-First, I would like to echo the remarks made by the honourable member for Murray (Mr Lloyd) about the promptness of the response by the Minister for Health (Mr Hunt) to this latest collection of erstwhile unrecognised problems in his rather hastily prepared health Bill. On the other hand, I suspect that the fact we do not meet in December is the only reason we will not be having a National Health Amendment Bill No. 4 in this session. I think we should be grateful that the present BUI is not a further massive switch in the health policies of this ministry, as were its two immediate predecessors. In many ways it is a minor BUI and I would predict the first of many minor Bills which the Ministry wil need in order to plug the present health scheme.

I refer to a brief section of the BUI, section 9, and the incredible complexity of the clauses. In reading 105AB, 73BE, 4aa and 73BFB I was reminded of, if I may be a little flippant, the taxation Acts. That suggested to me that perhaps the Minister was really determined to challenge the Treasurer (Mr Howard). As the Treasurer introduces a tax avoidance BUI practically every month these days in order to plug the tax system, I suspect we are now in for a series of monthly Bills from the Minister for Health in which he Will be plugging the national health system. I would not be at all surprised if in the next session of this Parliament we regularly encounter Bills to plug gaps in the national health system, gaps which have been referred to in this debate.

What are the gaps that this particular Bill is plugging? I do not want to go into it in too much detail because these have been mentioned in this debate by both sides of the House, but we might nickname the Bill the ‘Hospital Contributions Fund Disallowance Bill’ since it was specifically stimulated by the Hospitals Contributions Fund’s effort to disallow 100 per cent cover to some of the chronically ill. Despite many denials it does seem these rules providing for this exclusion were approved by the Health Department. Indeed it does not seem unreasonable for these HCF rules to have been approved, nor does it seem that the HCF was acting unreasonably when it introduced them, because if you take the words of the Minister he positively encouraged this sort of development in the health system.

If the Minister argues that he ‘quite deliberately allowed flexibility, innovation and competition between the funds’, was not the HCF being flexible? It was minimising its bad risks, maximising its good risks; a good flexible insurance principle. It was being innovative. It was merely the first to recognise that free enterprise is alive and well in the health insurance field and was acting appropriately. It was certainly being competitive because what better competitive principle is there in the insurance business than to drive your bad risks over to your competitors? Once you decide to have an active free enterprise system in the health insurance field- and this has been actively encouraged by the Governmentyou will get these kinds of activity. I think it was naive of the Minister to expect other behaviour from the funds and after two years experience of them I am surprised that he was caught on the hop and forced to act in this way.

You will control this kind of activity only by massive and complex legislation and by creation of a much enlarged bureaucracy at considerable cost; this bill is the start of the process. Once you have this ethic at work in the health field you will control it only by massive regulation, by increased bureaucracy and increased cost. This bill is the first step down that path and an inevitable step. It will be followed by more.

The Bill has four major provisions which I will not reiterate and, as the honourable member for Prospect (Dr Klugman) said, we on this side support those four provisions. We believe them to be necessary given the scheme that the Government has now fathered. But there are two comments I would make about those provisions.

First, nearly all of them would have been unnecessary if Medibank Mark I had been maintained; that is, nearly all of them are the result of the changes that have been made in the system and each of them adds to the complexity of the present scheme. As I said before, it is becoming like the taxation system, a confused labyrinth for the ordinary citizen. Further, I fear that because of the structure of the medical scheme this Bill represents the first and, unfortunately, a necessary step into an ever deepening morass.

Why do I argue that? I feel it is necessary to justify it.

As this Bill superbly illustrates, to encourage flexibility, innovation and competition between the funds- in other words, to encourage rampant free enterprise in the health field- is simply to encourage abuse. I do not believe that unbridled private insurance agencies is compatible with effective and adequate community health delivery. If the insurance ethic is to be pursued logically the chronically ill have to be jettisoned or charged peculiarly high rates. That is a perfectly sensible thing for insurance organisations, as insurance organisations, to do. As I said, they try to maximise the good risks and minimise the bad risks. This is perfectly logical for health insurance agencies to do- good free enterprise ethics. Of course the private agencies will seek to exploit the system at every opportunity in order to maximise their contributions and to minimise their pay-out on claims.

Of course no government- not even this onecan tolerate unbridled free enterprise in the health field. Therefore, as in this Bill, it will seek to constrain and to confine the free enterprise principle to limit its worst ravages. As with tax evasion, each effort to confine it will produce new evasions and thus a demand for new rules, new bureaucratic oversights. It is not a pleasant prospect that looms before us. Moreover, the prospect is clouded by the significant deductible element in the new scheme. There are two major aspects of the deductible element. One is the massive and obvious deductible- no levy, no insurance. Innumerable other deductibles are being brought forward in the competitive struggle between the funds. The classic problem with the deductibles is that if they are sufficiently attractive- in the competitive situation they are likely to be attractive- they will draw off the young, the healthy and those wealthy enough to take the risks. All those people will be drawn off from the standard tables of the funds. Thus the cost of standard cover must inevitably rise because the good risks have departed. This means that the cost of health cover will tend to rise for the sick and the poor. One can predict with the same certainty as that the sun will rise tomorrow that basic fund rates must rise within the next 12 months, simply because of the draining off of the young and healthy from the standard tables of the funds.

The principle of an equitable and universal health system is gradually being eroded to be replaced by the insurance principle that the sick, the old, the handicapped and people with large families must bear the bigger financial burden. My view is that the only benefit that will come in the long run from the present scheme will be the hope that it will convince an increasing majority of Australians that the most equitable and fairest system is to have a single universal scheme to which everyone contributes according to his means and on which everyone draws according to his needs. If such a system were properly supervised it would not only be the most equitable; it would be more efficient than a mass of competing agencies. It would be less expensive than a host of competitive funds with their massive advertising bills. We have seen plenty of evidence of that in recent weeks. It would be more capable of yielding the comprehensive health statistics which though we have been promised them for some time we are still without. Finally, it would be more capable of enforcing cost constraints than the present system of a host of agencies which indeed will tend to generate costs for the whole community.

Sitting suspended from 5.58 to 8 p.m.

Mr WEST:
Cunningham

-The minister for Health (Mr Hunt) has introduced this National Health Amendment Bill to ameliorate some of the anomalies that have appeared since the package of legislation was passed some weeks ago. It is the most positive example we have had yet that the Minister and the Government are in fact engaged in making policies on health insurance on the run. The House, of course, will remember the substance of that legislation passed some weeks ago. Of course, then we saw the abolition of Medibank Standard, the removal of the levy- the 40 per cent general subsidy paid to all people whether they are in health insurance or not- and, of course, the abolition of general bulk billing. The theory was that bulk billing would be abolished for all people except pensioners, for whom doctors would receive 85 per cent of the medical fee, and disadvantaged people, for whom doctors would receive 75 per cent.

The effect of this legislation was to create two pools of health insurance. As I said in my speech on that occasion, it creates a position that is actuarially unsound. We ought to have one single health insurance fund in Australia. Surely the best principles of funding demand that. The Minister in fact is inciting people to gamble with their own future good health. This creates a situation where a number of those people who are in fact healthy will stay out of health insurance, while those who are chronically ill and those who have large families, of course, will seek health insurance. The whole basis of successful insurance funding is that all people should be in one pool. Australians are entitled to expect that during their lifetime they will be adequately covered by the cheapest and best system of health insurance. That should mean that people, when they are young and healthy, should be paying to help subsidise those who are not so lucky. Of course, as time moves on and they themselves become older then there is another group coming up behind them, so to speak, to help keep down their health insurance rates. I repeat that this position is actuarially unsound. As I said before, the Minister knows it. In his second reading speech, the Minister said: . . I would like to inform honourable members that the Government’s new health insurance arrangements are working exceptionally smoothly . . .

He must be joking. Firstly, we saw the Hospitals Contribution Fund of Australia outrage. I put it to the Minister that what happened when the HCF in New South Wales moved to exclude the chronically ill from the 100 per cent cover was inevitable. It was always going to happen because it was inherent in the system that the Government created. I ask: Why allow the insurance funds the opportunity to take such action? Why do we need all these private health insurance funds in Australia? It would be much simpler and more efficient if we simply had the one national health insurance fund in Australia.

I will give another example of why the legislation that the Minister put before the Parliament some weeks ago is certainly not working smoothly. I refer to the bulk billing situation. Certainly with Medibank Mark I and Medibank Mark II doctors were able to bulk bill on behalf of everyone. Of course, that was changed some months ago. A great deal of evidence is mounting that doctors in fact are not prepared to bulk bill for disadvantaged persons and, in some cases, for pensioners. The worst feature of this aspect of the legislation was that the doctors themselves were allowed to decide who was a disadvantaged person. They were to be the arbitrators, so to speak- the unpaid social security agents for the Minister. I predicted trouble then and I submit that I was right. I said that there are 24,000 doctors in Australia and we could have some 24,000 different sets of criteria. Hard evidence is mounting that many doctors, particularly specialists, and also x-ray centres and pathology centres are refusing to bulk bill. In fact, many of then are demanding cash. I shall read into Hansard an article which appeared in the Illawarra Daily Mercury to re-inforce my statement.

Mr Cotter:

-Great stuff.

Mr WEST:

– I ask the honourable member to listen to it and he will find out what is happening. It states:

A 1 3-year-old girl with a respiratory complaint was turned away from a Dapto doctor’s surgery this week because her mother did not have the $9 with her to pay for a consultation.

Under the Medical Practitioners’ Act, the doctor was legally in the right.

It goes on to state:

From a doctor’s point of view, her condition was not serious.

But her mother . . . was worried. She thought her daughter’s condition was serious.

It goes on to mention the history of the patient. A history of asthma and respiratory complaints in the family had meant that they had spent hundreds of dollars on medical consultations. They had paid all their bills previously. The article continues:

But on Monday when Mrs Atkin took Susan to the doctor, she was told Dr Ali no longer kept accounts and saw patients only on a cash basis.

I am so angry about this that I am inclined to name doctors in my electorate who are demanding cash and who certainly will not bulk bill disadvantaged persons. We are also having trouble with pensioners. I will not read out the names but I will supply them to the Minister later if he requires them. There are at least two doctors at Shellharbour, one at Warilla and a group of at least six doctors practising together in a suburb of Wollongong called Dapto who are demanding cash before they see their patients.

Mr Hunt:

– Disgraceful.

Mr WEST:

– I tell the Minister that it is true. People who have been turned away have telephoned me. I refer now to the situation with pathology. In Market Street, Wollongong, there is a major private pathology centre. People, including pensioners, have telephoned me to say that this centre was bulk billing them as pensioners up until 1 November but now it is demanding cash. It will not accept the 85 per cent rebate it gets from the Department of Health. One lady gave me the following facts:

She was sent to have some blood tests taken because of a cancer on the lip. The doctors demanded $46 from her. She was a pensioner. She paid the $46 and she had the test. Leaving aside the argument whether the doctors should be bulk billing, this example points to the real heart of the trouble. The doctors who are sending these people to these private clinics are at fault. I made inquiries and I found that that test could have been done at the public hospitals at Wollongong or Port Kembla. Why was it not done there?

All of this evidence is mounting up. What will the Minister do about it? He said in his second reading speeches on this Bill- he knows what he said so I will not bother picking up the Hansard and reading it out- that the Government would watch the situation very closely and if the system was not working he would take some action. I understand also that the Minister for Social Security (Senator Guilfoyle) stated in relation to these cases: the Minister for Health and his Department would want to hear about them because the Government intends to take whatever action is necessary to overcome any difficulties that may result from the Government’s proposals for disadvantaged persons.

That is recorded on page 1632 of Senate Hansard. The Opposition asks: What is the Government going to do about this situation? There are 422,000 people unemployed throughout Australia and a good percentage of doctors are refusing to treat these patients as disadvantaged people. We want to see some action on this matter. I will be very interested to hear what the Minister has to say in his reply on this legislation.

Let me examine quickly the reasons why I believe the Australian Medical Association has always been vehemently opposed to bulk billing. I spoke to some of the members of the national executive of the Australian Medical Association and asked the direct question: ‘Why have you always been opposed to bulk billing? Is it because you know that once it becomes the accepted procedure throughout Australia it will mean that the Government has in fact imposed a control on medical bills in a de facto situation simply by virtue of the fact that it has become accepted that doctors accept 75 per cent or 85 per cent of the total fee?’ They said: ‘Yes, of course that is the reason.’ That is the real reason why the AMA has always been opposed to bulk billing.

I think the Minister has passed up the chance to control doctors’ fees. By abolishing bulk billing generally, he is supporting doctors who wish to charge the maximum fee. Surely it would have been possible to check the malpractices that undoubtedly occurred without destroying the whole concept of bulk billing. It would have been a great weapon in the Minister’s hands. He says that he is seriously concerned about controlling medical costs. This would have been the way to control the costs. The main reason for increasing health costs is to maintain the fee for service system. The secondary reason is the fact that I mentioned earlier Doctors are inclined to send to specialists patients who ought not to be going to specialists. Doctors send people to private x-ray and pathology centres for blood tests and x-rays when they should be sending them to public hospitals.

The AMA has always encouraged a sort of mystical approach to medicine. It is a hangover from the Middle Ages and even from prehistoric eras. Is there any real reason why this should be so and why this practice should be encouraged to continue? Medical practitioners and specialists acquire their training and their expertise at public educational institutions. The majority of them receive practical instruction as interns in public hospitals. Why has the AMA considered that it should dictate to society that private practice is the natural and desirable order of things? Let us take as an example the skilled engineer. Like a doctor, he has most likely been trained in a public university at the taxpayers’ expense. An engineer can choose to work as an employee- that is, if he is lucky enough to obtain employment in this economic situation- or he can choose to work as a private consultant. But no one, including honourable members opposite, would seriously say that an engineer should not work for a salary. So why does the AMA supported by the Minister for Health and the Government, oppose salaried medical staff in such a biased, bigoted and sectional manner? The answer must be, above all, that the Government wishes to support the members of the AMA in their attempts to maximise the position in society, to preserve their privilege and to set their own incomes. Why does this Government not attempt to control doctors’ incomes in some way as it moves to control the incomes of ordinary wage and salary earners? It is all very strange, particularly as the Minister is so very fond of lecturing us on the necessity to control escalating health costs.

I ask further What of the future? What is to be done about health insurance in Australia? I submit that we ought to go back to the concept of a single national scheme. We could do that by increasing the 40 per cent general subsidy to 75 per cent or 85 per cent, by once again allowing bulk billing for those doctors who would accept the return as a set percentage of the bill without charging for the remainder of the bill. In fact, that would be going back to the Medibank mark 1 situation. I think the argument how it should be funded- whether by a levy or by general taxation- is academic. Probably a levy would be necessary but that would be infinitely preferable to the present situation. Having re-established Medibank as the single system of national health insurance, we must ensure that it is not just a means of guaranteeing fee for service for doctors. We have to do something extra. I hope that, when the Labor Party achieves government in 1980, after having set up that medical insurance system, we will also move to set up medical centres employing salaried doctors so that the new Medibank does not just become a system of guaranteeing doctors’ salaries in the fee for service system.

How do we overcome the objections of the AMA? We overcome those objections very simply. The Minister for Health, the AMA, the Health Commission and Dr Sidney Sax all tell us that the universities and colleges of advanced education are turning out too many doctors.

Mr BARRY JONES:
LALOR, VICTORIA · ALP

– There are 2,000 unemployed doctors.

Mr WEST:

– Yes. A report in the Sydney Morning Herald under the heading ‘AMA call for cut in student intake’ tells how many doctors there are now in Australia- some 24,000. It states that if we continue at the present rate by 1991 there will be 32,200 doctors in Australia one for every 500 people, and that that will be too many. It states that we ought to help to preserve the AMA’s privileged position by cutting the intake. What nonsense that is. We should be turning out the same number of doctors and not allowing them to go on unemployment relief. We should be employing them in government medical centres. That is what we should do with the extra doctors whom the universities are turning out. That is why the AMA wants to cut back the intake.

This Bill is conspicuous for what it does not do rather than for what it does. I have carefully spelled out the proven deficiencies of the Government’s latest Medi-muddle and what ought to be done. Let the Minister try again. Let him bring down legislation that will provide for 85 per cent of the scheduled fee to be returned to doctors who bulk bill for all services. Let the surplus of doctors and specialists who are being turned out from universities and colleges of advanced education be employed in hospitals, outpatient departments and medical centres at a generous salary. It would be far cheaper to do that than to carry on the way we are. Let the Minister stop, think and start again. Let him try to bring down a health insurance system that will serve the people of Australia, not just the medical profession.

Mr CONNOLLY:
Bradfield

-This is the first occasion since I have been a member of this House on which I have spoken on the subject of national health. Perhaps one of the problems I have faced is that, like others, being reasonably healthy myself I take it for granted that other people also are generally healthy. However, a situation which occurred in Sydney on the weekend leading up to 1 November brought quite clearly to my mind the fact that every Australian citizen has a right to expect from the health service available to him what I call simply a ‘fair deal’. Regrettably, on that occasion a number of people, citizens of Australia, residents of the State of New South Wales, were informed by a medical health fund of which they had been members for some years that because they had the misfortune of having chronic illness they were to be asked, in fact advised, to transfer their medical cover elsewhere. The legislation before us, the amendment to the National Health Act, is one for which I believe the Government and in particular the Minister for Health (Mr Hunt) deserve our highest commendation. They have seen, as those of us in Sydney saw, that no medical system worthy of the name could possibly be implemented for the Australian people if it permitted such conduct to be continued by any medical fund. Discrimination, in whatever form, has no place in this land, and I hope that all parties in this Parliament agree on that point.

This legislation is directed specifically towards preventing or reducing discrimination against medical benefit contributors in relation to the scope and level of benefits available to them for medical services rendered on or before 1 November 1978. In the Bill, improper discrimination is clearly defined as relating to chronic diseases or other illnesses of a particular kind, age, maximum benefit rules applied by organisations, and any other prescribed matter referred to and decided upon by the Minister. I hope that this legislation once and for all will close what were obviously seen by some people in the medical health insurance area as an opportunity to rid themselves of those human risks which they preferred not to have and, hopefully, could be passed on to someone else. As the Minister said on that occasion:

It is totally against the ethics of the health insurance industry for one fund to try to offload its bad risk members to another fund.

I believe that such behaviour is abhorrent. I believe that it is quite contrary to basic ethics, and common decency. I have been accused by some of believing that we should apply the same standards of ethics to the health insurance industry as to life insurance, the house insurance industry or the general insurance industry. Some people find that difficult to understand. Frankly, I do not. In all those areas there is one common thread, and that is the law of contract. A contract is entered into between a person and an organisation and, having accepted that contract, the organisation has no choice, as I see it, in the case of health care but to give that person the full opportunities to which he is entitled under the specific schedules for which he has paid regular contributions.

In recent weeks I have received a number of letters from constituents pointing out their own specific problems. In many cases, they contain details of great sadness, of young children who have become sick following years of common membership by their families in a fund. Because they are chronically sick, some unprincipled people want to take advantage of their situation. I am delighted that this Government is closing that opportunity. As I said to the Director of the Hospitals Contribution Fund in a telegram I sent to him, I and my colleagues in this Parliament will take whatever steps are necessary to ensure that legislative action is initiated to prevent discrimination of that type. I am delighted that I have had the opportunity to participate in this debate and to congratulate the Government for the action it has taken in this regard.

A few points have been made by speakers on the other side to which I would like to draw attention. The honourable member for Cunningham (Mr West), for example, made the point that medical costs were going up. The reality is that medical costs have stabilised to a much greater extent over the last 12 months than they had in recent years. I believe we can hope that that situation will continue. As the Minister and the Government have said on numerous occasions, all sections of the health industry- the doctors, the hospitals, the funds, and all paramedical services- have a responsibility to ensure that in the national interest medical costs are kept at a reasonable level. We should take whatever action is necessary to keep down medical health costs. I believe that the proposal now before the House, which strengthens the recently amended National Health Act, goes a long way to guaranteeing that all Australian citizens should be given a degree of choice in terms of the medical services that they may want and did not have under Medibank No. 1, which we have heard glorified in its death throes by members of the Opposition.

Reference was also made by the honourable member for Cunningham to the fact that we have too many doctors. The honourable member is aware, as I am and as the Minister is, that in New South Wales in particular there are now two graduating classes at the same time. We all know that this should have been thought out some years ago when that situation developed. With respect previous members of this House and of the State Parliaments, for reasons best known to themselves, ignored that situation which obviously was going to be created. If the honourable member finds that there are too many doctors, may I also draw to his attention the fact that in South Australia, which I understand is a Labor governed State, they are still allowing foreign doctors to go on the South Australian register. To my knowledge, it is the only State in the entire Commonwealth which is still allowing foreign doctors open entry to the register of medical practitioners. I suggest that that is a matter worthy of consideration. I have no objection to people migrating to Australia under the new guidelines put forward by the Minister for Immigration and Ethnic Affairs (Mr MacKellar), and L welcome them. The fact remains that if there is a great shortage of opportunities for Australian doctors, if there is a clear case of over-supply in relation to demand, I would expect that all State governments, because that is where the regulations have to be applied should look upon this as their responsibility. A State of the honourable member’s political persuasion, South Australia obviously is at least as responsible for maintaining some control over entry to its medical register as other States of the Commonwealth.

We are bringing forward these amendments because we believe they are necessary, but the honourable member for Prospect has made the complaint that nothing has been done. He asked why this matter was not dealt with in the first place. I take this opportunity to remind the honourable gentleman that one member of the managing body of the HCF I believe is a representative of the New South Wales Labor Government. What was he doing? Perhaps he was not attending meetings and did not know what the policies of the fund were going to be. It is all very well to come in here and complain about what we have not done, but his State

Government in New South Wales had a representative on the Board of the HCF. If he really had at heart the interests of the Australian constituents, especially those of New South Wales, I venture to suggest that he should have taken some action to advise Mr Stewart, the Minister for Health, and if necessary take unilateral action to prevent, to nip in the bud, this most heinous situation that was allowed to be created. The New South Wales Government, as usual, huffed and puffed about the matter but did nothing. The legislation is now being amended and I sincerely believe that we will not see situations such as this developing in the future.

Before I conclude, I would Uke to ask a question which I hope the Minister will answer. I am particularly concerned about the fact that patients in New South Wales psychiatric hospitals are, to the best of my knowledge, being charged fees and apparently, for reasons I discussed earner, they are not able to get reasonable coverage from existing health funds. I ask the Minister: Does he consider that this places an unfair financial burden on such patients and their families? I sincerely believe it does. I believe that this is an area of medical health which should be given serious consideration by all levels of government.

Mr HUNT:
Minister for Health · Gwydir · NCP/NP

– in reply- I would like to say how delighted I am that all members of the Parliament including those opposite, have supported the general thrust of this legislation, in spite of some of the more political comments that have been made and that one would expect to be made in the course of such a debate. I take the House back briefly to what caused the problem. It was the issue of the Whitlock family, which had been insured with the Hospitals Contribution Fund of Australia at tables higher than the basic table. After 1 November the table at which Mr Whitlock was a contributor was abolished and a higher table was created. Then, because of a recent history of chronic illness, the fund chose to write and tell the family that as from 1 November it would be entitled to a maximum number of benefits. This family had been contributors to that fund for a period of 10 years. So nobody in his wildest dreams could have believed that any health insurance fund would have taken the liberty that the HCF took in respect of the flexibility that was being offered to him.

The purpose of this National Health Amendment Bill (No. 3) is to ensure that no fund will be able to take such a mean advantage of contributors to health insurance funds in this country again. Health insurance funds have had opportunities to do what HCF did before. In fact, they have had chronic illness rules in their medical tables, and certainly they have had them in their hospital tables, for many years. We have never seen such a mean advantage being taken of a rule that the fund intended to apply. Sure, the fund intended to apply the rule in a very frank and honest way. It wrote to all its contributors.

Time is getting on, Mr Deputy Speaker, and I know that the House wants to proceed to other business. I would like to answer one point raised by the honourable member for Prospect (Dr Klugman). I refer to his point relating to improper discrimination as it might apply to benefits for procedures, such as cosmetic surgery. The Bill does not prevent this. The purpose and the objective specified in the Bill are to ensure that benefits will continue to be available to persons who suffer from chronic illness or other medical conditions when cover is needed most. Any discrimination must, in the opinion of the Minister, be improper discrimination. This Bill is not directed to maintaining benefits cover for services such as cosmetic surgery where funds tables exclude benefits for these services. I would not envisage the power of direction being used to that end. I point out, however, that to the extent of any action taken under the Bill, optional tables will be controlled. I conclude by once again thanking all honourable members who have participated in this debate. I thank the House for its support.

Question resolved in the affirmative.

Bill read a second time.

Dr KLUGMAN:
Prospect

– I move:

That, pursuant to notice, this Bill be referred to a legislation committee for report by 24 November 1978.

Mr DEPUTY SPEAKER:

– (Hon. Ian Robinson- Is the motion seconded?

Mr BARRY JONES:
LALOR, VICTORIA · ALP

– I second the motion, Mr Deputy Speaker.

Dr KLUGMAN:

-I would like to make a couple of points in support of the motion. The first point relates to the difficulty involved in dealing with this type of legislation in the Committee of the Whole. I think that such a procedure with this type of legislation is completely unsatisfactory. What we really need is an intelligent discussion on the meaning of the National Health Amendment Bill (No. 3 ). Just to illustrate that point, the Minister for Health (Mr Hunt) said that we are dealing only with chronic disease. That is just not true. The Bill states: improper discrimination’ means a discrimination that is related to all or any of the following matters:

One of the matters is: or from a disease, illness or medical condition of a particular kind;

That has nothing to do with chronicity. Another of the matters that is referred to in that definition is: the age of a person;

I should not think that the age of a person would have anything to do with chronicity. The next matter referred to in the definition is: the frequency of the rendering of professional services to a person;

That has nothing to do with chronicity.

Mr Hunt:

– It could well have.

Dr KLUGMAN:

– It might well have, but it need not have anything to do with chronicity. The point I am making is that the power that is being given to the Minister is not restricted to chronicity. I am not suggesting for one minute that it ought to be restricted to chronicity. The only point I am making is that a number of other issues can be dealt with. To add extra weight to my request that this legislation be referred to a legislation committee, since I spoke in the second reading debate on this Bill this afternoon, I have checked how many times just one section in the National Health Act has been amended since this Government started to amend it on 29 February 1976. 1 refer to section 73B of the Act; not to section 73, but to section 73B, which was inserted after section 73A had been inserted. Section 73B has been amended 1 5 times in 2Vi years.

Mr Hodges:

– Tell us what you are proving.

Dr KLUGMAN:

-I am proving that this Bill should go before a legislation committee. It could just possibly be that the first, second, up to the thirteenth amendment, were not the proper amendments. If they were, why did the Government have to amend the section twice more by way of this Bill?

Mr Hodges:

– Dealing with bushrangers like you, anything could happen.

Dr KLUGMAN:

– The honourable member has been on the grog again. The point surely is that, if we could have an intelligent discussion about this in a room where the proceedings were not being broadcast and where the Minister, on the advice of his legal advisers, could answer questions on the legislation, surely it could be argued, even to the satisfaction of the Deputy Government Whip, the honourable member for Petrie (Mr Hodges), that 13 amendments, now followed by two further amendments, seem excessive for one particular section of an Act. All I am putting to honourable member is that all the amendments cannot be correct.

Mr Hodges:

– Have you put a submission to the Minister on this?

Dr KLUGMAN:

-I have moved a motion that the Bill be referred to a legislation committee. A few months ago this House decided, on a motion by the Leader of the House (Mr Sinclair), that such a procedure would be followed so that we could have some intelligent discussion on legislation. I do not mind. The Government gets into political strife every time something like this blows up. Honourable members opposite know very well that the kudos does not go the Government ‘s way if it has to bring in further amending legislation. Just over a month ago the Government brought in amending legislation on this subject. That legislation was passed. Now the Government has introduced legislation to make two further amendments to section 73b. Does this not give honourable members opposite some vague feeling that maybe they should talk about this legislation?

This Bill seeks to amend section 73be of the Act, not by deleting it but by adding two full pages of printed matter. The Bill seeks to insert a new section, section 73BFB. Honourable members can see from that how much this section has been amended. Proposed section 73BFB covers one and a half printed pages. Surely that is sufficient argument in favour of having the legislation dealt with by reasonable, rational honourable members from both sides of the House, for them to be given some knowledge of what this legislation is all about and for them to have the help of expert advisers.

Mr HUNT:
Minister for Health · Gwydir · NCP/NP

– The Government cannot accept the amendment because of the urgency of this legislation. We have a very serious problem. A health insurance fund has sought to use a rule to the disadvantage of health insurance contributors to a table. Many of the contributors have contributed to the maximum tables of that fund for up to 25 years. So let us get on with the job. Let us get this legislation through so that a determination can be made to protect the contributors. I assure the Opposition that we have sought the best legal advice possible. A tremendous amount of time has been given to this legislation. I do not think that legislation which has wider powers has been introduced into this Parliament in the time that I have been responsible for the health insurance area. The BUI contains provisions which protect the community from the excessive powers that are vested in the Minister, in that his directions must be laid on the table of this Parliament. The powers contained in this legislation are very embracing indeed. I have no doubt that the legislation will close the loopholes that were present in the Act prior to this evening.

Mr BARRY JONES:
LALOR, VICTORIA · ALP

-I think it should be pointed out that we recognise the urgency of this legislation and we recognise that the session is very quickly drawing to a close. The whole purpose of the establishment of Legislation Committees was so that it would be possible for honourable members to leave the House when it is crowded, as it is at the moment, and to-

Mr Bourchier:

- Mr Deputy Speaker, I rise on a point of order. There is no way in which a Legislation Committee can meet unless everybody agrees to it. It cannot meet if there is one dissenting voice. The Minister has already put-

Mr DEPUTY SPEAKER:

– (Hon. Ian Robinson) - Order!

Mr Bourchier:

– Just a moment Mr Deputy Speaker, you have not allowed me to put my point of order.

Mr DEPUTY SPEAKER:

-Order! I am asking the honourable member to put his point of order.

Mr Bourchier:

– I am. The honourable member for Lalor is out of order in that there has been one dissenting voice. Therefore there can be no argument.

Mr DEPUTY SPEAKER:

-The question has not been put in order for there to be a dissenting voice.

Mr BARRY JONES:
LALOR, VICTORIA · ALP

– We appreciate the urgency of the situation, but it can be pointed out also that a Legislation Committee could meet tomorrow morning. The very points that were made by the honourable member for Prospect (Dr Klugman)- they were not made in a contentious spirit but in order to seek consensus- could be put and argued out and some agreement reached in a Legislation Committee. The suggestion is that, in dealing with clauses which have proved to be inadequate, in the past the method that very often we used in the Parliament- the method of confrontation; one side against the other- may be inferior to the method of seeking consensus. In that situation 15 members sit around a table, talking the situation out, trying to reach some kind of agreement on points that are tricky and contentious, and putting a variety of points of view. All we are suggesting is that we allow a Legislation Committee to meet tomorrow morning.

Mr Bourchier:

– You do not want people to get health care. You are against health care.

Mr BARRY JONES:
LALOR, VICTORIA · ALP

– The Government Whip’s remarks suggest two things: Firstly, that he is in serious need of medical attention himself and, secondly, that he does not understand the nature of the point we are making. We are not making the point of order in order to try to score political advantage. We are trying to produce legislation which will cover all the future exigencies. When the legislation is carried, its application will be retrospective and it is hard to see that there will be any serious delay in its passage through this House and through another place. I ask the Minister for Health (Mr Hunt) to give serious consideration to the proposal. It is not offered in any spirit of contention. Its intention is to try to get the best out of the legislation, not for the Government, not for us, but for the community at large.

Mr DEPUTY SPEAKER:

– (Hon. Ian Robinson)- The motion before the House is that: This Bill be referred to a Legislation Committee for report by 24 November 1978’. There being a dissenting voice, the question is resolved in the negative.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr Hunt) read a third time.

page 3342

NEW BUSINESS AFTER 11 P.M.: ADJOURNMENT OF THE HOUSE

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

– I seek leave of the House to move a motion to suspend Standing Order 48A, Adjournment of the House, and Standing Order 103, 11 o’clock rule, for this sitting. The reason for my seeking leave to move this motion is that I am advised that the statements we wish to make, under our present schedule, might not be made by 1 1 o’clock. I wish to have them made tonight, and I therefore seek the co-operation of the House in doing that.

Leave granted.

Motion ( by Mr Sinclair) proposed:

That Standing Order 48a, Adjournment of the House, and Standing Order 103, II o’clock rule, be suspended for this sitting.

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

-The statement just made by the Leader of the House (Mr Sinclair) could best be described as ambiguous. The House is being asked to suspend the 1 1 o’clock rule in order that some statements can be made. I think the Minister ought to make it plain to the House what the statements are in the first instance. Then he should try to indicate why it is so important to suspend the 11 o’clock rule so that those statements can be dealt with tonight rather than tomorrow. There is a saying to the effect that men love darkness rather than light because their deeds are evil. That saying is of biblical extraction. I should not imagine it is out of order.

Mr Bourchier:

– Do you mean the extraction is out of order?

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

-I should not imagine that it is out of order at all. It could even be appropriate; I do not know, and I do not think anyone else could know, including the Government Whip who is interjecting. In other words, we are being asked to rubber stamp a proposal that we suspend the 11 o’clock rule so that we can deal with some statements about which we know nothing.

Mr DEPUTY SPEAKER:

- (Hon. Ian Robinson)- Order! I draw the attention of the honourable member for Hughes to the items listed on the Notice Paper. It shows clearly that it is intended that two ministerial statements be made by leave. I would imagine that you, as Opposition Whip, would be aware of that.

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

-If there is a simple explanation I will be very glad to hear it.

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

– in reply- Let me assure the honourable member for Hughes (Mr Les Johnson) that I rather thought that the blue sheet imparted light rather than darkness. Of course, statements are made available to the Opposition two hours before they are delivered. In addition, Orders of the Day Nos 7, 8, 9, 10, 1 1 and 12, and two ministerial statements, are listed on the Notice Paper all of which I trust we will conclude tonight.

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

– With the indulgence of the House, I could possibly have -

Mr DEPUTY SPEAKER:

– (Hon. Ian Robinson)- Order! I have just realised that under the Standing Orders the Minister has closed the debate. I am therefore obliged to put the question.

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

– Will not the Minister grant his indulgence?

Mr Sinclair:

– I would be happy to grant the honourable member indulgence if he is seeking indulgence.

Mr LES JOHNSON ( Hughes )-I simply wish to say that an apology might be in order. It could be that I am on the wrong track. I understood that the Opposition was seeking to raise a matter in connection with the particular problems of the Leader of the House (Mr Sinclair) and that the whole issue was in a state of abeyance pending the appearance of the Minister in the Parliament.

Mr Sinclair:

– You must be nuts. I have been here all day. I was away for two hours at lunch time. Your colleague wished to withdraw his notice of motion because he was not prepared to be in the House.

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

-I think that is a point well worth clarifying. At least it draws attention to a matter which might otherwise have been regarded as surreptitious.

Mr KEATING:
Blaxland

-by leave-The notice of motion to which the Opposition Whip alluded was withdrawn because the Government would not facilitate a debate in the early hours of the evening. It would not allow a debate to take place until after the statements had been presented to the House, which would be around midnight. The Opposition withdrew the notice of motion with the view of moving it or of giving notice of it tomorrow.

Mr SINCLAIR:

– by leave-Mr Deputy Speaker, with your indulgence, let me say that the motion I think had its correct priority in that I notice today that first of all a notice was given with respect to Standing Orders. There was then a matter of public importance. There was also a grievance debate. The Opposition gave other notice of motion after all those matters. I rather suspect that the degree to which the Opposition believes there was substance in the motion is reflected by the order of priority that it gave in its submissions to this House today.

Question resolved in the affirmative.

page 3343

NEW SOUTH WALES GRANT (CHRYSOTILE CORPORATION) BILL 1978

Second Reading

Debate resumed from 22 November, on motion by Mr Eric Robinson:

That the Bill be now read a second time.

Mr KEATING:
Blaxland

-The New South Wales Grant (Chrysotile Corporation) Bill 1978 is to grant assistance to the Government of New South Wales by way of a section 96 repayable grant for lending to the Chrysotile Corporation which is situated at Barraba near Tamworth in New South Wales, otherwise known as the Woodsreef asbestos mine. The problem with this mining operation has been that over a period the mine has become uneconomic because of changes, mainly in currency exchange rates. The mine was on the point of closure when it appealed to the Federal Government for assistance. The Federal Government disapproved of short term assistance to the mine. It was only after the New South Wales Labor Government indicated that it would spend up to $2m in underwriting the operating losses of the mine that the Federal Government came to the party with legislation which is before us tonight for a maximum of $ 1.4m, virtually on a dollar for dollar basis with the Government of New South Wales.

The New South Wales Government which has spearheaded the attempt to resurrect the mine has done so mainly on the basis that this is the largest asbestos mine in Australia. Indeed it is really the only asbestos mine operating in Australia. There are 435 employees at the mine and about 700 people who are employed indirectly from the mine, which brings the employment base that is created by the mine’s continuing operations to about 1,135 people, which is significant for any rural area of Australia. The export earnings of the mine roughly are about $22.5m which again is not inconsiderable. The mine is a relatively new operation. It began in 1972. Because of the currency exchange rate fluctuations in 1973 when there was a revaluation of the Australian dollar of 25 per cent against the United States dollar, the mine got into difficulties mainly because asbestos is priced in Canadian dollars. It was because of this fact that there was therefore a loss of revenue which forced the mine into receivership only a year after it began.

The mine then came to an arrangement with the Commercial Bank of Australia, its banker, and continued in operation thereafter. It has only experienced difficulties again in recent times after the Canadian dollar was devalued, which led to a 15 per cent decrease in revenue for the mining operation. Again the change in the parity of the exchange rate between the Australian dollar- loans to the company are made in Australian dollars- and the Canadian dollar which it earns has of course produced this disparity. As well as that, the Woodsreef operation was forced to reduce its prices because of a price cutting war in the asbestos industry, mainly because of an over supply facing a limited demand situation. The price cutting was begun by the Rhodesians about 18 months ago. It has led to a further 6 per cent decrease in earnings. With the 1 5 per cent loss from the exchange rate differential and the 6 per cent loss from price cutting, there has been about a 2 1 per cent loss of revenue. Of course this has been almost more than the mine could bear.

The matter was investigated by the Industries Assistance Commission with the view to granting short term assistance. The Commission recommended against short term assistance. The New South Wales Government, recognising that it was not just an economic problem but also a social problem- 1,100 or 1,200 people would be thrown out of employment in an area of New South Wales where there was no alternative employment base- saw fit to resurrect the case and appealed to the Commonwealth to join it in giving joint assistance. The. New South Wales Government, as well as offering $2m towards the cost of underwriting the mining operation, has sought to waive the mine’s royalty commitments to the State of New South Wales and has forgone additional revenue from what would otherwise have been reasonably handsome royalty payments. The Wran Government of New South Wales has demonstrated its bona fides in trying to keep the mine open and encouraging the Federal Government to reverse its decision which originally was to accept the IAC report and reject short term assistance for the Woods Reef mine.

The funds have been provided as repayable loans at commercial rates of interest. The loans will be repayable out of the earnings of the mine. One has to be reasonably optimistic to think that there will be earnings to enable the loans to be repaid. An assessment was carried out on the future of the mining operation and its earning potential. One of the factors which encouraged both governments to support short term assistance was the fact that the company had moved towards the recovery of tailings from its earlier mining operations which should increase its revenue by about IS per cent. The company also expects a 7Vi per cent price increase from January 1979. It is expected that the demand during 1980 will be increased. At this time of the year in the asbestos industry- this period is called the mating season- companies that mine asbestos sell their products for the ensuing year. Prices are fixed for the ensuing year.

The New South Wales Government’s consultant who was commissioned to study the prospects of the mine has indicated that he believes that the increased demand that is expected in 1980 and the likelihood of a 7 1/2 per cent price increase, coupled with a IS per cent increase in revenue coming from the tailings recovery equipment which the mine management has increased, plus the fact that the Commercial Bank of Australia has been prepared to accrue interests over the period gives the mine a chance to continue into the future and ultimately to operate profitably again and hence repay its loans from the Commonwealth and New South Wales governments. We on this side of the House believe that government moneys cannot just be handed out to bail out commercial operations. With a reasonable prospect of return and, given the fact that banks on any commercial basis cannot continue with their lending program, which of course would force the mine’s closure, funds have been made available to meet the operating cost of the mine over that period.

It is not insignificant that 1,100 to 1,200 persons in the Barraba area of New South Wales will be kept in employment. I think it is also important to recognise that in that area private ownership is worth about $2m. With a lot of the mining operations around Australia the townships are in fact company owned and there is no cost to any of the employees in the event that the mining operation closes, given the fact that they are normally provided with severance conditions and pay. Because they do not have mortgage commitments and the like they do not go away having incurred a loss. But in this case about $2m has been expended on private dwellings. There would be a very heavy burden placed on those 435 people who are directly employed at the mine and the other 700 people who are indirectly employed, which I think would be far too onerous. In the cause of good sense and compassion for an isolated community which is relying exclusively for its employment on the asbestos mine at Barraba, I think the New South Wales and Commonwealth governments have acted with prudence in trying to maintain the mining operation by underwriting its operating losses.

One can only hope that the prognostication of the New South Wales mining consultant will, in fact, come to pass and that the mine will move towards a positive cash flow position in the foreseeable future. We on this side of the House have much pleasure in supporting the legislation. Confidence has been placed in the mine’s management and its employees. Let me dwell on that point. I had the pleasure of meeting the employees and the management a month or so ago. I was very impressed with their co-operative corporate effort to try to save the mine and to make sure that there is complete harmony between the management and the employees. That factor will make a very great difference to the prospects of the mine moving towards a positive operating surplus in the future. The Opposition joins with the Government in supporting this legislation. It hopes that its faith is not misplaced and that the mine management and employees will do their best to take the mine back to a positive cash flow position, repay their obligations and continue to operate the mine on a positive basis in the future.

Mr O’KEEFE:
Paterson

-On behalf of my colleagues, the Minister for Primary Industry (Mr Sinclair) who represents the electorate of New England and the Minister for Health (Mr Hunt) who represents the electorate of Gwydir, I strongly support the New South Wales (Chrysotile Corporation) Bill 1978. The right honourable member for New England has the towns of Manilla and Barraba in his electorate. Therefore, he is vitally interested in this legislation. The Minister for Health has Bingara in his electorate which provides a lot of employment for Woodsreef Mines Ltd. He, too, is vitally interested in it. It is pleasing to see that the honourable member for Blaxland (Mr Keating) and his colleagues support the legislation. It is interesting to hear that the honourable member met the Managing Director, Mr Robinson, the staff and employees on the mine site recently.

The Bill provides for a loan of $ 1.4m by the Commonwealth Government. This is to be matched by the State Government which will forgo royalties also. The loan of $1.4m by the Commonwealth Government is for a period of 15 months at commercial rates of interest. It is secured by a mortgage on some of the equipment. The Commercial Bank of Australia Ltd which is heavily involved in the Woodsreef mine has also come to the party. This is a combined operation by the Federal Government, the State Government and the Commercial Bank of Australia Limited. Woodsreef mine is the only asbestos mine in Australia. As you would know, Mr Deputy Speaker, it has a small operation at Baryulgil on the far north coast which employs a significant number of men. The Woodsreef mine employs 435 men. At least 700 people are employed in providing ancillary services to the mine covering a wide area, including the City of Tamworth, Manilla, Bingara, Bundarra and possibly Armidale. At least 60 homes have been built in the town of Barraba. If the mine should close, this would have a disastrous effect on this fine country town.

The mine has been operating for the past six years. It is equipped with the most modern machinery. The life of the mine is anticipated to be well over 10 years. If it should close the Government would have to pay millions of dollars in unemployment relief to those people put out of work. The State Government would lose pay-roll tax and the Commonwealth would lose valuable export income of about $20m. We import on average 50,000 tonnes of asbestos a year. At present the Chairman and Managing Director of the company and a top executive are overseas gaining orders for the mine for the 1978-79 financial year. The mine has secured an order from the Australian company James Hardie Asbestos Ltd for 20,000 tonnes. There is no doubt that the prospects for Woodsreef in the future seem extremely good.

The mine has experienced financial problems because of the lowering in value of the Canadian dollar and the dumping of asbestos on the world market. There was an over-supply of asbestos when Rhodesia and Russia dumped their surplus on the world market. This seriously affected the Woodsreef financial operations. The prospects this year are much brighter. I understand that the executive overseas are achieving success in securing orders. When they come back in the next few weeks it will be interesting to see just how they have gone. The sales forecast for the mine this year totals $28.6m- $6.9m on the Australian market, including the 20,000 tonnes to James Hardie and $2 1.7m from overseas sales. The Government has everything to gain and nothing to lose by keeping this mine open. As I said, it is the only asbestos mine in Australia. It produces good quality asbestos. Despite what health authorities have said about asbestos, we have been assured by the executives of the mine that there is very little danger of the employees being contaminated with the dust which is supposed to have caused considerable health problems in asbestos mines in other parts of the world.

We support fully the legislation. As the honourable member for Blaxland said, there were delays whilst the New South Wales Government considered what assistance it would make available to keep the mine operating. The Government in Canberra had to carry out full investigations to see what contribution it would make. As I have mentioned, it is by way of a loan. It is good to see that the governments are prepared to keep this mine operating, for the reasons I have given. The Bill is fully supported by the Government.

Mr KERIN:
Werriwa

-The honourable member for Blaxland (Mr Keating) and the honourable member for Paterson (Mr O’Keefe) have set out very clearly the economics and history of this mining operation and the impact on this town if mining does not continue due to a withdrawal of funds. They have set out some of the human ramifications of the problem. I would raise a few general points with respect to the dangers of asbestos because the Chrysotile Corporation have asked for repeated exemptions in meeting the New South Wales regulations set up to protect the workers in this industry. Recently the honourable member for Blaxland has assured me that he understands the mine is going on to the wet milling process and after that is carried out and machinery is installed, the mine will then meet all New South Wales standards with respect to the protection of the health of the workers at the mine itself. If the amount of funds now being advanced is inadequate to meet the standards then I say that funds need to be increased. As the honourable members pointed out, the Industries Assistance Commission did not recommend assistance to this mining operation. The Government here first said it was going along with the recommendation but later changed its mind, given negotiations and the expressed concern of the New South Wales Government. However, the Industries Assistance Commission report did take into account environmental health standards and the possible effects on the workers at that mine. I believe I need to quote in some detail from what the IAC said. The report in part read:

The effects on the health of employees and those living in close proximity to the activities associated with asbestos mining and the manufacture and use of goods containing asbestos were discussed at the inquiry. In particular, health and environmental issues were discussed by Woodsreef, the New South Wales Department of Decentralisation and Development, EHCD, the Division of Thoracic Medicine of Royal Prince Alfred Hospital, James Hardie, members of the medical professions, and representatives of unions.

Witnesses indicated that there is a close correlation between the level of asbestos dust to which people are exposed and diseases which can be regarded as being a result of asbestos fibre in human tissue or developing as the result of the presence of asbestos fibre. Their evidence was based on research conducted in Australia and overseas.

Further on in the report there is this section:

The standards for asbestos dust levels in New South Wales are controlled by Section SS General Rule 65b Mines Inspection Act 1901, and Section 17 of the Clean Air Act 1961. General Rule 65b allows the Chief Inspector to specify the standard for any particular type of dust. In December 1 972 the then Chief Inspector set the standard for Chrysotile asbestos dust levels at Barraba and Baryulgil at 4 fibres per millilitre in accordance with the recommendation of the National Health and Medical Research Council. In March 1978 the operating companies were informed that a new standard of 2 fibres per millilitre would apply as recommended by NHMRC.

CCA’s operations at Barraba do not comply with the standards in all work areas. Because of financial difficulties, installation of capital equipment required to meet the standards has been deferred. In July 1977, the State Pollution Control Commission issued an order under Section 17 of the Clean Air Act requiring the installation of air pollution control equipment. To assist the company to comply with the standards the New South Wales Minister for Mines and Energy agreed to waive royalty payments in respect of the mining operation for the period 1 November 1977 to 31 October 1 978. The company was required to place orders for the equipment by 31 October 1978 and have it installed by 31 March 1979. As part of its request for short term assistance -

Which is now being met by this Government-

CCA requested a repayable cash grant from the Commonwealth Government of $650,000 to cover the cost of environmental equipment required by the Department.

It goes without saying that the company is liable to a substantial penalty for non-compliance with the regulations. I would like an assurance from the Minister- I am not sure whether the responsible Minister is the one at the table- that some of these funds are going directly to meet these requirements with respect to health standards. The report continues:

In 1973, shortly after the Barraba mine opened -

As the other members have said, it is a very modern mine, recently opened-

CCA arranged for the Division of Thoracic Medicine to carry out a survey to monitor the health of its employees particularly in respect of asbestos related diseases. The first survey was carried out in 1973 and another in 1977. It was stated that these surveys did not detect any asbestos related diseases but a number of cases of unrelated diseases were detected.

This is to be expected because the dormant period of these disease outbreaks involving asbestos is in the region of approximately 20 years. The report goes on:

Between August and December 1977 the Health Commission of NSW conducted a health survey of current employees at Baryulgil and of as many previous employees who work at the mine for a minimum period of 12 months as possible. In addition, for control purposes the survey covered a group of Aboriginal males with no occupational exposure to asbestos and women and children over the age of 12 years living at Baryulgil. Some findings of that survey were supplied to the Commission in confidence. It is still under consideration by the New South Wales Government.

I hope that the results of those surveys are soon known to all of us. I think it goes without saying that the creation of dust containing asbestos, not just in the mining operations but throughout Australia and throughout the world, wherever asbestos is used, is causing more and more concern because it is known to give rise to a risk of development of two types of disease of the lungs, asbestosis and cancer mesothelioma. The degree of risk is dependent upon the amount of dust inhaled and on its size distribution; fine, invisible airborne fibres in the dust are the most hazardous constituents. Asbestos has numerous different uses, notably for building materials; insulation, noise suppression, fire resistance and against friction. Being so widely used it represents quite a potential hazard. For example, asbestos-containing materials commonly used in the home and which can release asbestos fibres when worked without adequate precautions being taken, when broken, or from general deterioration through wear and aging include asbestos sheets, insulation boards, ceiling tiles, ceiling insulation, vinyl asbestos floor tiles, and plugging compounds. One could go on to a wide range of products.

Asbestos is the name given to a group of fibrous silicate minerals with a crystalline structure, the most common of which are: Serpentine, that is Chrysotile which is the white asbestos; Amphibole, which is Crocidolite, the blue asbestos; Amosite, the brown asbestos; and Anthophyllite, which is the white asbestos. It seems to me from reading the Industries Assistance Commission Report that they downgrade the risk with respect to some of these forms of asbestos. They say the blue asbestos is by far the most dangerous. Whilst that may be true, I still think it is medically proven that Chrysotile and Amostie are just as dangerous in most conditions and it is the level of exposure that is the key factor in determining the level of risk. Blue asbestos was found largely in insulation materials in Australia where it was used before 1970. In the opinion of most regulatory authorities the levels of exposure to blue asbestos which can be regarded as non-hazardous are so low that it is not possible to achieve them in a practical situation. The NHMRC Occupational Hygiene Committee recommended a hygiene standard of exposure to Crocidolite of 0.1 fibres per millilitre in January 1 978, but this has not been accepted.

I turn now to the biological and clinical effects of exposure to asbestos. Here I am relying on medical evidence. The diseases that we are talking about include asbestosis- which is a progressively disabling pulmonary fibrosis or type of pneumoconiosis- an excess of bronchial carcinoma and malignant mesothelioma of the pleura and peritoneum. There is also evidence that asbestos is associated with an excess of cancers in other organs of the body. Other adverse effects of asbestos in the respiratory system include benign pleural effusion, that is, fluid on the lung; collagenous pleural thickening, that is, thickening of the lung wall; and focal pleural calcification.

Asbestosis usually becomes evident about 20 years after initial exposure. When a significant proportion of the lung is affected breathlessness may occur, leading to partial or total incapacity, and there is no cure. These asbestos induced diseases are dose related. One must stress that there is a lot of ongoing research and there is a need for research to be collated. The inhalation of dust from all forms of asbestos can cause asbestosis. A significant number of people with asbestosis develop bronchial carcinoma. This applies particularly to smokers with asbestosis. Mesothelioma of the pleura and peritoneum is also related to the type of fibre.

This risk is very much greater in the case of crocidolite- that is blue asbestos- than it is with amosite and chrysotile. Mesotheliomas- that is the cancerous form- have also been reported in people who have had no known exposure to asbestos. Cigarette smoking greatly increases the likelihood of lung cancer among people exposed to excessive asbestos dust. It has been worked out that asbestos workers face a risk of lung cancer eight times greater than that of the general smoking population. There is also medical evidence showing that there is a multiplicitive effect with smoking and asbestos exposure in the causation of cancer of the lung; so that risks are increased as much as 70 times normal. Some researchers say that the risk is up to 95 times more than for non-smoking, non-asbestos exposed people.

Even slight exposure to asbestos may cause pleural plaques or the presence of asbestos bodies in the lungs or sputum, but neither of these signify anything but evidence of exposure. Cancers in other sites of the body have been attributed to asbestos dust. The uncommon form of cancer I have already mentioned, mesothelioma, may occur in the chest or abdomen many years after initial exposure. This is not common but causes concern because reported cases are believed to have resulted from relatively low exposures. Mesotheliomas appear to be much more frequently associated with exposure to blue asbestos than to the other varieties of asbestos.

The quantitative relationship between the atmospheric concentration of asbestos dust and the risk of cancer is not known. It is therefore not possible to specify a safe standard for asbestos exposure at which this risk is removed, although it is generally agreed that the minimum exposure needed to cause mesothelioma is considerably less than that required to cause other asbestos induced diseases. We simply do not know what the levels are. The danger to the general public lies in the fact that inhalation of asbestos fibres may lead to the production of cancers. The two most common types are the common bronchial carcinoma and the rare mesothelioma which I have just mentioned. The induction of mesothelioma is particularly associated with exposure to crocidolite, blue asbestos, but it is probable that some risk of developing this tumour is also associated with exposure to other types. The risk of bronchial carcinoma cannot be attributed specifically to one type rather than another.

I hope that I have put before the House enough evidence that has been gleaned and collated by various people concerned with this industrially caused problem of asbestos caused diseases to convince honourable members that we need to take into account the real danger in respect to the use of asbestos in our society rather than simply discussing this Bill here tonight in terms of economics and the impact on employment in the Barraba area. I think that the House needs to take into account the problems that can be caused by the use of asbestos and the fact that a lot more research is needed in this matter.

Question resolved in the affirmative.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr Eric Robinson) read a third time.

page 3348

STATES GRANTS (SCHOOLS ASSISTANCE) BILL 1978

Second Reading

Debate resumed from 26 October, on motion by Mr Staley:

That the Bill be now read a second time.

Mr ERIC ROBINSON:
MCPHERSON, QUEENSLAND · LP

- Mr Deputy Speaker, may I have the indulgence of the House to raise a point of procedure on this legislation. Before the debate is resumed on this Bill I would like to suggest that it may suit the convenience of the House to have a general debate covering this Bill and the States Grants (Tertiary Education Assistance) Bill as they are associated measures. Separate questions will, of course, be put on each of the Bills at the conclusion of the debate. I suggest therefore, Mr Deputy Speaker, that you permit the subject matter of both Bills to be discussed in this debate.

Mr DEPUTY SPEAKER (Dr Jenkins:
SCULLIN, VICTORIA

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

Dr CASS:
Maribyrnong

-The Opposition is not opposing these Bills, but we disagree with the philosophy underlying them and we expressed those views of course during the Budget Session when these ideas were first proposed. I wish to make some comments on the approach that the Government is taking to education and its funding. The allocation of funds in the States Grants (Schools Assistance) Bill in no way represents the independent view of the Schools Commission on proper priorities based on real needs. These allocations represent a gross distortion reflecting the bias of the Liberal Government in favour of privilege.

Before discussing that in more detail, I am intrigued to note in the States Grants (Tertiary Education Assistance) Bill a similar bias expressed in a very subtle way in the funding of universities, colleges of advanced education and technical and further education institutions. Funding for the universities is on a three-year basis. In other words, the universities are aware of where they are heading in the next three years; they have had funds allocated three years ahead. However, for the CAEs and technical and further education institutions funds have been appropriated for one year only. We are told that the explanation for this is that the Government is awaiting the report of the Williams inquiry. What worries me is what conclusions we may draw from this. I suppose from this we can assume that the universities are to be considered sacrosanct. They have been allocated funds for three years ahead whilst the changes- by the attitude of the Government to other public funding one can be only pessimistic- will involve the CAEs and the TAFE institutions.

If this behaviour means anything, surely it means funds will be cut. Hence the funding at present levels is for one year only. If there were a chance that, as a result of the Williams inquiry, there was a proposal to increase funding for these institutions, then surely the Government could have afforded the luxury of allocating funds at the present level for three yeas ahead. If, as a result of the report, it is decided that additional funds can be granted then, at Budget time, additional funds could in fact be given. If, however, the intention is to cut spending then it is understandable that funding has been specified for one year only. It would be very difficult to allocate funds for three years and then, as a result of the recommendations, decide to cut the funds for the last two of the three years. That is what makes me fearful that, in essence, that is what is likely to arise from this inquiry.

However, I return to the funding for schools. Despite the talk the Schools Commission tried to propose an overall increase of 5 per cent for education. Following the issuing of guidelines by the Minister for Education (Senator Carrick), in real terms we find that there is a one per cent increase in the Budget allocation. Capital grants for schools are down by $8m which represents a decrease of 5.9 per cent or 6 per cent. On the other hand, capital grants for non-government schools- the private sector- have been reduced by $lm which represents a cut of only 3.3 per cent. There is a clear differentiation between the two main school systems in favour of the private sector. We have been told that there will be an increase in migrant and multicultural education. I will refer to that again later.

I refer again to grants to non-government schools. Recurrent grants for non-government schools will go up by $14m. This is the real increase in expenditure for education. The amount of $9.1 m is to be distributed to allow for automatic linking of non-government school recurrent grants to average expenditure for each pupil in government schools. As the cost of education in government schools goes up, the funds allocated to private schools will increase automatically to maintain the same relationship. The amount of $2. 4m will be given to levels 1, 2 and 3 schools. They are the schools which are better off in the community than most of the other private schools which most private pupils attend. These schools, generally speaking, are at least as good but mostly far better off than the State school system. The amount of $2.5m has been given as a flat increase to the poorest private sector- $5 a head for the primary pupils and $6 a head for secondary school pupils at the level 6 schools.

In the report on education of the Minister for Education, which has just been released, we find that it is claimed that the level 6 schools are those eligible for the highest level of government support. That sounds good until one examines the situation and dissects it a little more. The level 6 schools are the poorest schools and are mainly Catholic parochial schools. They represent approximately 90 per cent of the non-government primary school pupils. Sixty five per cent of secondary pupils go to those sorts of schools. In the Minister’s report in the table labelled Table 2, we discover that average expenditure for the six States, in the government primary school sector, has reached 106 per cent of the Karmel target. In the secondary school sector- that is the government schools- the average is much the same, maybe a huie less. However, in the nongovernment combined, primary and secondary schools, level 1 schools are already at 124 per cent of the Karmel target. In other words, they are up by 24 per cent on where they hoped they would be. The level 2 schools are 6 per cent above the target. Levels 3, 4, 5 and 6 are much lower. Level 6 schools received significant mention in the report which states:

Table 2 shows that Level 6 schools were on average operating at 34 per cent below the Karmel target in 1976-77 . . .

The Government has recognised the deficiency in level 6 schools. But what has it done about it? Despite the brave statement to which I referred earlier that the level 6 schools are those eligible for the highest level of government supportthey are certainly eligible for it- the question is: Will they get it? If one looks at Table 3 contained in the Minister’s report one will find some interesting figures. Let me quote some of them. These are general recurrent grants for each student in non-government schools for 1979. That is what they will get compared to 1978 grants. At the level 1 schools- that is, the best quality schools where the minority of private pupils go; in the primary sector it is only 10 per cent- the payments for each pupil for 1 979 in the primary sector will increase over the 1978 figure by $27 a pupil. Level 2 will increase by $30 a pupil; level 3 by $13 a pupil; level 4 by $16 a pupil; and level 5 by $18. But the poorest level, level 6- the level that needs the greatest amount of support- will get the same level of support that is, $27, as the richest schools in the community. We admit that level 6 schools need most, but in fact they will get only $27 a head more which is the same as the amount received by the most privileged schools in the community.

At the secondary level, the situation is even worse. The first level schools- the richest, the poshest and the ones attended by the elite of the community- will get an increased government subsidy of $35 a head. Level 2 schools will get an increase of $37 a head. Levels 3, 4 and 5 do not do so well. They will receive an increase of $33, $10 and $1 1 a head respectively. When we get to level 6 schools where the government itself admits there is the greatest need- that is something that the Schools Commission has been saying all the time and something that the Karmel inquiry first stated very clearly- we find that they will receive less than the three top levels in the private sector. The level 6 schools will get $20 a head. Let me repeat the figures. Level 1 schools will receive $35 a head; level 2, $37 a head; and level 3, $23 a head. That is hardly reflecting the real needs of the children in those schools. It is hardly living up to the claim the Government makes that it recognises the need that the highest level of support should go to level 6 schools. That is complete hypocrisy. The figure of $ 14m has been bandied around as an increase in support for private schools. When it is lumped together conveniently and not analysed it looks as though the poorest schools are getting a lot because $9m or $ 1 lm is allocated to them. If one analyses that amount in terms of the numbers of pupils attending the schools, one finds that level 6 schools are decidedly worse off than the most privileged secdons of the community. I now deal with an area of specific interest to me at the moment because of my involvement in immigration and ethnic affairs. I refer to migrant education. In the second reading speech, the Government’s decision was announced in relation to migrant education. It stated:

Until now the child migrant education program has operated as part of the general recurrent grants program. From 1979 it will be a separate program and the main purpose of the program, namely the teaching of English as a second language . . .

This is emphasised in the Bill. In other words, the Government is giving the impression that it really recognises the problem and that it really intends to do something about it. The Minister also stated:

The Bill provides for the introduction of the new multicultural education program in 1979. Both Government and non-government schools will benefit from the program which, in 1979, will focus on the teaching of community languages.

So, there will be more emphasis on the teaching of English, separate from the rest of the school curriculum and funded out of the general recurrent grants. We will have another program which will focus on teaching of community languages funded out of the general recurrent grants and separate from English to get us all more acquainted with the new multiculturalism which we all have now begun to realise we have to understand, accept and do something about.

I wish to point out some of the doubts that I have about the separation, this concentration on a specific problem. I think that the best way to deal with the matter is to discuss it in terms of the approaches that we have made over the years to the problem of what we do with migrants. Of course, there has been a range of approaches over the years. They have varied. The first policy was a policy of assimilation. This was predicated by a myth. In a speech entitled: ‘It’s time for migrant education to go’, the Commissioner for Community Relations, Mr Al Grassby, said this:

The myth was that there is only one Australian type- 6’ tall, lean, blond, blue-eyed and named Smith.

Mr Yates:
Dr CASS:

– I am not sure that there is one in this Parliament. I share the view of the honourable member that of course it was a racist approach. But of course, if we are honest we have to admit that it was the view held by many people in the community and it was the policy that we pursued. We felt that we ought to encourage people from wherever they came to become Australians. That was the popular view of what an Austraiian was. As a policy it has failed as it did in the United States of America and in Canada. For the same reasons as applied in those countries, we in this country are going to have to change our approach. The next approach was to tolerate cultural diversity, but to consider it in a sort of subsidiary role, to see it as something designed for people who are slightly peculiar or who are a bit different. We were going to learn to tolerate them. They were rather interesting and nice to have around.

Mr Yates:

– Like Pommies.

Dr CASS:

– Precisely. That policy has not been accepted. The third approach has been to try to recognise the need to implement multicultural policy for all Australians, particularly in the educational sphere because we are now a multicultural nation whether we like it or not. In essence, the approach of assimilation tried to treat all children as alike, as if there were no difference among them. The second approach was one of recognising that some people were a little peculiar or a little odd and involved tolerating their cultural diversity. But it placed an emphasis on teaching English as a first language. So, therefore, we had to provide additional help to those children who needed it.

There were some 400,000 children whose first language was not English. They must be given help so that they can better master the English language. The approach in trying to implement this policy has usually been to withdraw the nonEnglish speaking children into remedial classes so that their language difficulty is equated with physical or mental handicap. In fact, many of the children came to feel that they must be inferior because they had to be given special instruction. In other words, they felt that if one’s first language was not English one was clearly a handicapped child. As a community relations exercise, this approach has been disastrous, almost as disastrous as the assimilation approach which pretended that there was no difference at all between individual people. It has been disastrous not just because of the effect it had on migrant children but also because of the effect it had on English speaking children. A monolingual, monocultural English speaking youngster would feel his ego growing every time his neighbour in school was hauled off to the special class where that child was to be taught English. The child needing special instruction in English, we also recognise- this is the latest development- ought to be given help to maintain his native tongue, his first language, as well.

The end result of all this is that the migrant child, having been given additional help, will have a mastery of English. He will be helped also to maintain his own language. The English speaking child will be monolingual, in my view disadvantaged. What about the situation of a school- this is an example that Al Grassby gave- where there were 25 per cent of Australian children and 75 per cent migrant children? Some of the parents of the children attending that school claimed that the 25 per cent Australian, the English speaking, children, were being discriminated against.

The 25 per cent were being discriminated against, they claimed, because the 75 per cent were receiving additional tuition, support in English and were getting support also in their own language. The Australian children were getting no support in their own language and they were not being taught an additional language. In my view they were suffering educational deprivation. It will only be when all the children in all of the schools in Australia receive the same teaching about our multicultural society and when all of them are given access to a second language that we will be able to say that discrimination has been abolished and everyone is being given the same opportunities. For these reasons, although the Opposition is not opposing the Bill, we are very sceptical about the philosophy behind the moves that have prompted the legislation. We register our disapproval.

Mr McVEIGH:
Darling Downs

-The debate on the States Grants (Schools Assistance) Bill and the States Grants (Tertiary Education Assistance) Bill gives us the opportunity for some considered thoughts on the use and what the Opposition might term the misuse of Government funds for education. At the outset, I wish to pay tribute to the pioneers in this Parliament who in the years gone by have been the people who were responsible for the injection of Commonwealth funds into the education of the Australian child and the Australian adult. It is good for us to reflect and give credit to these people who paved the way for us. We find now that the Commonwealth Government is responsible for the total costs of tertiary education and is a considerable provider for funds in the area of the Schools Commission responsibility and the area of primary and secondary education, mentioned by the previous speaker, the honourable member for Maribyrnong (Dr Cass).

Whilst not wishing to enter into a great debate with the honourable member, I wish to point out that there have been many pluses in the successes of education and education funding since the return of the Fraser- Anthony coalition government approximately three years ago. One of the significant areas is the area of teacher-pupil relationships. This has fallen from 22.8 students per teacher in 1975 to 20.8 students per teacher in 1978 in primary schools and from 14.2 students per teacher to 12.7 students per teacher in secondary schools. That to me is a significant increase in education input. I also wish to comment on the fact that we can read many different factors into a table of figures. Quite rightly, the honourable member for Maribyrnong cited increases in certain areas in terms of dollars but I believe he did not quote the salient factor, that is, that, in the Level 1 schools, the percentage of standard costs which the Government bears by way of general recurrent grants for students is 1 6 per cent of the estimated costs of educating a child in a government primary school for a year, namely, $845. In level 6 schools the percentage of standard costs has increased to 33 per cent. Whilst the number of dollars is exactly the same, the significant factor is that there is a greater percentage increase in the level 6 schools in the primary area. The same relationship is evident in the secondary area, where 15 per cent is the norm for level 1 schools, and this increases to 3 1 per cent for level 6 schools. I indicate those percentages to allay some fears that may be held in the community that the Government has not injected finance into the area of greatest need.

It would be appropriate also for me to relate our philosophical approach which is different from that of the Labor Party. I certainly do not want to criticise its philosophical approach; beliefs it holds near and dear. Our philosophy is that each child in Australia, irrespective of the income of his parents, is entitled to some basic contribution to help his or her education in a school of the choice of the parents by virtue of the fact that they are taxpayers. So there is a combination of need and justice. It is also worth pointing out that, contrary to rumours, outlays on education in the last Budget increased by 6. 1 per cent to $2,497.6m, or 8.7 per cent of estimated total outlays. That is a significant input by the Commonwealth Government into education, notwithstanding a very tight economic climate and environment. Some 8.7 per cent of estimated total outlays are funded by the Commonwealth Government in the area of education, and that is an increase of 6. 1 per cent over the previous year. Those figures are worthy of note by people who criticise us for not making an input in the education area.

We live in an inquiring era and fortunately it has developed a sense of accountability. It is an era which is distinct from the global swirl of the high policy that said that money satisfies every need. We submit that quantity in itself is not the only answer. There has to be a relationship between quantity and quality of education, and that leads me to the absolute necessity to have accountability in educational funding. Fortunately, these impulses are comfortably on the assendancy. It is necessary for us to make sure that we do not develop a handout mentality whereby we fund every application. It is necessary to make sure that the educational share of the available government dollar goes as far as possible. We have adopted a policy of funding for recurrent purposes on the basis of a triennium. It is true that funding for recurrent costs for colleges of advanced education is not included in this Bill, and the previous speaker gave the reasons for that. We are awaiting the release of an exciting report. Let us hope that the report of the Williams Inquiry into Education and Training will be released by the end of the year.

Basically, recurrent costs also will be funded on the basis of a triennium for colleges of advanced education. I suggest to the Government that it is absolutely imperative that we also adopt a system of three-year funding at least, for capital purposes. It would be better if funding was carried out on that basis because it would enable a more disciplined approach, greater flexibility, better planning, and probably the securing of better contracts because of an on-going commitment whereby people would know well ahead that the total program was going to be for a three-year period. I hope that the Government will give some consideration to adopting a triennial approach also for capital costs. There is some difficulty, of course, in financial budgeting. We have a fiscal year which goes from July to June whereas educational funding is done on a calendar year basis, a school year basis.

Whilst the Commonwealth Government is often criticised for not giving enough money to the States for purposes that the States believe are essential to allow them to fulfill their commitments, it is appropriate to recall that the Commonwealth meets all the costs of tertiary education. It is good to know that in 1975 135,000 students were helped in one form or another by Commonwealth assistance, and that figure has increased to 170,000 in 1978, an increase of 26 per cent. It is important to let people know what we have achieved in a positive sense. I become somewhat disturbed when I pick up newspapers in a certain State of Australia wherein a Premier, because he is upset that he is not getting enough money for main roads purposes, say, to make himself politically popular, says: ‘If you damage your car by hitting a pothole in a road, ring up your friendly Federal member and blame him. ‘ Let us be fair. If the States are going to adopt that approach they should also display at the entrance to every college of advanced education and university a sign stating: ‘Your child attends here by virtue of the generosity of the Federal Government. ‘ That is justice. You cannot have it in one way and not accept it in another way.

Mr Corbett:

– There should be signs on the freeways too.

Mr McVEIGH:
DARLING DOWNS, QUEENSLAND · NCP

– The honourable member for Maranoa has always said, quite rightly, that we should put such a sign on the freeways. I hope that the Commonwealth Government will receive praise and not carping criticism for what it has done. We look forward with great anticipation to the findings of the Williams inquiry for one very obvious reason. For far too long in Australia we have looked at education merely for education’s sake. It is time we considered education with greater emphasis on training for work and training for living. What is the sense in turning out people through an educational system who are the best dressed men and women in the world but have nowhere to go and do not know how to get there. The system should educate people for work and for living. The Williams inquiry will touch on the topical aspect of whether our present education system is the best one. We must have accountability, a critical analysis. We must have a disciplined approach and far-sighted vision as we launch education into the 1980s and 1990s and beyond into the 21st century. Those are some of the inputs that we hope the Williams inquiry will bring forward. We await its report with keen anticipation. What a wonderful Christmas present it will be. The inquiry underlines the philosophic aims and objects of education.

In relation to this BUI I also want to deal with some specific matters that are contained in the schedule. I have talked about the national approach. Now I want to get down to the local approach as it affects people out in the field. I want to talk about colleges of advanced education and point out that in the Darling Downs area next calendar year the Commonwealth Government wil be injecting the huge sum of $ 14.356m into the colleges of advanced education- the Queensland Agricultural College at Lawes and the Darling Downs Institute of Advanced Education at Toowoomba. The Darling Downs Institute will receive $8. 5m for recurrent costs and the Queensland Agricultural College will receive $4,558,000. For their capital programs, the Darling Downs Institute will receive $791,000 and the Queensland Agricultural College $507,000. What a tremendous input into a regional area. What a wonderful encouragement to decentralisation. There will be a direct input of $14. 5 m into a local region to serve the people there who seek higher and better education in a wonderful environment. That is big business, and we pay tribute to a government which has spread its wings wide and has not looked at education as being just the province of the metropolitan areas.

Let us consider for a minute the wonderful input of these regional colleges of advanced education and the great service given by people. On Saturday night I will have the privilege of being present at a testimonial dinner for Mr Neil Briton, C.B.E., who for 40 years has been Principal of the Queensland Agricultural college at Gatton.

Mr Corbett:

– He helped to educate Doug Anthony too.

Mr McVEIGH:
DARLING DOWNS, QUEENSLAND · NCP

– I am reminded by the honourable member for Maranoa of what a wonderful contribution Mr Briton has made to the Australian nation. To think that this man moulded and guided the basic education of a great Australian. a man who has done a tremendous amount in developing honesty of purpose and sincerity in the Australian population. I am reminded that this man is an honest man. Mr Briton has helped not only local Australians but also students from overseas who attend Gatton College under all sorts of programs, including the Colombo Plan. Neil Briton has seen the college grow. On Saturday night it will give me great pleasure in saying to him: ‘A tall tree grew from the small acorn you planted here’. He has seen the college grow from a purely agricultural college to a college of advanced education, a college which now has courses not only in rural matters but also in hospitality, valuations, food technology, food processing, food service management. It services 550 students and has 320 staff members. It attracts funds from private industry for research in the area of Aviculture, chicken meat, eggs and the pig industry. It’s research program is also funded by private enterprise, such as the Commonwealth Development Bank and the Dalgety organisation. It is carrying out research to determine the level of bos indicus blood needed to maintain immunity from ticks and to produce lean meat through bos europa blood from the chianina, charolais and simmental breeds of cattle. This is progress.

Neil Briton has developed a college from a time when a graduate was looked upon as being a man devoid of practicality- a theorist- to a time when now he is considered a partner. We have the inquiring personality of the researcher and scientist, coupled with the dedication of the field worker and the trained mind of the business man all being developed at the college of advanced education, which is funded by this Government.

Mr Keating:

– Who built it?

Mr McVEIGH:

– The Queensland State Government. On Saturday night Neil Briton will be told at the end of his career: ‘Well done’. In the personal scene, we owe him a debt of gratitude for the heritage he has given us; a man who preserved for the future of Australia in the mechanical era the clydesdale horse, which represents the strength and toughness that made Australia great. What a pity we do not have a bit more of that strength and toughness.

I turn now to the Darling Downs Institute in Toowoomba, which was developed in 1967 because of the interest of local people. There was none of this hand-out mentality, of always going to government. The local people got together and put up portion of the money. There were 1 54 students enrolled in the first year, 1967. Now the Institute has an enrolment of 4,21 1 students. In an era when accountability is sometimes questioned, it is good to see that the Institute has a reorganisation plan under which it is critically looking at how best it can spend the Australian taxpayers dollar. Like Neil Briton of the Queensland Agricultural College, the Darling Downs Institute has a Dr Lindsay Barker, a good man with good lieutenants. It is not a Portuguese army. These men have observed, they are devoted and they have experimented and out of all this has come stability.

There is a need for the changing technical education environment to be looked at and the study going on at this institute is the most thorough and full, as well as the first, critical analysis of an ongoing institution. What a refreshing approach. We have had a macro approach over the total area of education. We have had micro approaches in certain faculties, but here we have a total single institution which from A to Z is aware of the fact that there must be accountability for public money. What do people and students expect? The old departmental system has been abolished. We now have an academic program approach to enable greater flexibility with staff, with fewer staff members teaching a greater number of students because they all come in on a program basis rather than a discipline basis. The rationalisation of lectures avoids unnecessary duplication. They are looking at areas of growth, areas of decline and areas of restructuring. It is good that this progress has been made because these colleges are locally autonomous.

What has been achieved at the Institute is the result of a combination of council, staff and students. That is the type of approach that is being adopted there. In a few weeks time stage 3 of McGregor College, a boarding complex associated with the Institute, will be completed. Again, it is funded by the Commonwealth Government in association with local people. Local people are concerned. They do not have an expectation of complete government funding.

In the few minutes left to me I want to talk about the 19 per cent increase in real terms in technical and further education. The Commonwealth adopts a topping-up approach. In Queensland 15.3 per cent of costs are met by the Commonwealth Government. We have an exciting program of pre-vocational courses which is extended by the Queensland Government to every centre in Queensland where there is a technical college, except Mount Isa and the Gold Coast. It grew from a pilot program of three years, with 224 places. Next year there will be 840 places. In the local area of Toowoomba 56 students, after they have completed grade 10, if they are not terribly sure of the type of life they want to lead as far as earning a living is concerned, will have the opportunity and the time to study and to find out where they want to go. They will have a wide range of options, not stereotype ones but what we might term a ‘family of trades ‘ education.

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

Dr JENKINS:
Scullin

– It is always a pleasure to follow the honourable member for Darling Downs (Mr McVeigh) in a debate. I am delighted to hear that his tertiary institutions are going so well. Shortly I am going to have something to say about country schools. With the defects that are still there, I think that it would have been more appropriate if the honourable member had talked about the defects in that area. In this cognate debate we are dealing with the States Grants (Schools Assistance) Bill and the States Grants (Tertiary Education Assistance) Bill. It is my intention to concentrate on the schools assistance aspect.

I want to make just one passing reference to the tertiary education field. Recently when the Government was floating the proposition that tertiary fees should be restored for students at tertiary institutions- thank goodness that that has now been retracted- it was said that freedom from paying fees at tertiary institutions had not appreciably assisted children from lower income families to gain tertiary education. I think that that was an improper way to put the position. I thought that that was more a function of defects in the primary and secondary education systems than it was a matter of the fees being charged at tertiary institutions.

In the late 1960s and early 1970s education was a vital field of great public and parliamentary debate. It occupied a great prominence in the debates of this chamber and, indeed, in many State parliaments. Between 1972 and 1975 there were massive changes in educational opportunities and in the involvement of financing from the Australian Government and, I believe, there was a great deal of improvement in our education system. However, I am appalled at the present dearth of public and parliamentary debate on education. The placing of these education Bills at the tail end of the session, and with so little involvement, indicates how much interest in the subject has been lost by parliamentarians. So much inequality still exists in the education system. Honourable members will recall how the concept of the needs basis took so much heat out of the old government school versus nongovernment school debate- the State aid issue. It was a debate that had a great deal of effect on the political party to which I belong. However, the institution of the needs principle allowed almost universal acceptability of the programs that were introduced.

I fear that the recent guidelines set by this Government have caused a rekindling in the community of those old fears and the old arguments about education funding. My colleague, the honourable member for Maribyrnong (Dr Cass) has mentioned this matter. I deplore the fact that these guidelines are restoking the old fires of dissension. For example, in my own electorate I received recently communications from committees at Lakeside High School, Greenbrook Primary School, Kingsbury Primary School, Reservoir High School, Preston Girls High School, Epping High School, Keon Park Primary School and the Preston Technical

Teachers Association of Victoria. All these communications expressed disappointment at the redistribution of finance between the government and non-government sectors in favour of the latter. In addition, they referred to the cuts in capital expenditure and the failure of capital commitment in the field. One can understand why some of these schools have this feeling. I shall quote from a letter I received from the Lalor West Primary School Council. It states:

The School Council, together with the parents of children attending this school, are deeply concerned with the lack of education facilities within the Lalor area.

This is an outer urban area. The letter continues:

Lalor West Primary School has accommodation for approximately 770 pupils, and is now at a level not far from this figure, and we also believe that Lalor Park Primary School is in a similar situation.

With new housing developments steadily increasing within Lalor West and Lalor Park boundaries, it is evident that, with potential new incoming pupils, these schools could not cope with such an increase in numbers.

In view of this serious situation, we would request that the Government urgently investigate the situation…..

These are the sorts of problems that the lack of capital commitment is causing. This is occurring in an area where there is a high migrant population.

Let me return to a more general topic of discussion. I am disappointed, as I have mentioned before, at the restricted debate which we are having on this matter. In recent months we have seen the Schools Commission’s report; we have seen the issuing of a discussion paper on some aspects of school finance in Australia from the Schools Commission; and we have had the ministerial statement on education on 2 1 November. In addition, material has been circulated by the Australian Teachers Federation, the Council of State School Organisations, the Australian Union of Students, the Federal Catholic Education Office, the University Staff Association, and so on. It is appalling that an appropriate opportunity has not been given for a wide ranging debate on these matters by this Parliament when one considers the increased involvement of the Federal Government in school financing.

I refer honourable members to an article by Dr Don Smart which recently appeared in Education News. I think this article gives us a very good indication of the increasing involvement of this Parliament and of the Federal Government in school financing. Dr Smart in referring to an incident in 1 945, commented as follows: the then Leader of the Opposition, Mr R. G. . . . Menzies, rose in the House of Reps to move an urgency motion calling for substantial federal aid to Australian education at all levels. Mr Menzies told the House that he deplored the current state of Australian education, and urged the Commonwealth Government to make a major contribution to educational reform. He said that the Government should begin by establishing- in collaboration with the States- an independent committee of experts to investigate Australia’s educational problems and to make suitable recommendations for all sectors.

As honourable members know, from that date on some activities started to take place. Unfortunately, it was that sort of activity that aggravated the situation between government and nongovernment schools. John Gorton made this statement:

In its own Territories, the Commonwealth is, of course, solely responsible for financing education but, even in the States, education is tending to become, in effect, a partnership between the Commonwealth and the States. The States have the prime responsibility, particularly in primary and secondary schools, but the Commonwealth is now sharing with the States in financing tertiary education and is making a direct contribution to secondary education.

We then move a little further along the road to when the present Prime Minister (Mr Malcolm Fraser) stated:

I should like to commence my remarks about the Commonwealth’s education program for 1971-72 by emphasising the close concern which the Commonwealth has, and will continue to have, with educational matters. The Government fully recognises the national importance of education and of the development of educational services, and its objective is to do what it appropriately can, in co-operation with the State governments, to improve the quantity and quality of education in Australia.

We then progressed to the step where tertiary fees were abolished and where there was a massive influence on total education throughout Australia. Mr Whitlam stated:

The Labor Party is determined that every child who embarks on secondary education in 1973 shall, irrespective of school or location, have as good an opportunity as any other child of completing his secondary education and continuing his education further. The Labor Party believes that the Commonwealth should give most assistance to those schools, primary and secondary, whose pupils need most assistance.

It was on this principle that that great program was started. One could not leave this matter without quoting also a comment made by Mr Beazley, the Minister for Education of that era. He said:

What has to be recognised in Australia is the power of simple snobbery and the extent to which education is regarded as a weapon to ensure the advantage of ‘our child over their child’. Perhaps there is a growing tendency to regard education not as a weapon of advantage, but as an instrument of the dignity of all children and young people. If this view becomes general, the educational revolution that matters will have been achieved.

Unfortunately it has not yet been achieved. I think we should be able to discuss and to carry on some of those matters of which Mr Beazley spoke. Dr Smart, in his article, analysed the reasons for the increased involvement of Commonwealth governments in education. I feel that time does not allow me to go through those reasons. One of the other factors that we have to consider is that many of the changed government guidelines and the comments of the Schools Commission are based on the proposition and the recording that many of the resource targets that were set out initially have been reached. At about the middle of this year, the Australian Teachers Federation produced material in which it cast some doubt on the effects that have been attained. The Australian Teachers Federation carried out a national survey and produced a sheet which compares the configuration and the facts.

Mr Yates:

– When was it done?

Dr JENKINS:

-It was done in the middle of this year. The paper is dated May 1978, so it is quite recent. The configuration is stated as follows:

The Schools Commission in its 1978 Report gave details of a configuration of resources for schools. They felt that this configuration might be achieved in Australian schools soon.

Then the comment of the Federation is this:

Information from the ATF National Survey of Conditions in Schools shows that Government schools are a long way from achieving that configuration.

The factors are set out under the heading ‘The Configuration’ and state:

  1. teaching staff sufficient to ensure that- infants classes need not exceed 25 students. primary or junior secondary classes need not exceed 30 students. senior secondary classes need not exceed 25 students.

The findings are: 42 per cent of infants’ classes exceed 25 students, 39 per cent of primary and 33 per cent of junior secondary classes exceed 30 students, and 24 per cent of senior secondary classes exceed 25 students. That is not very close to target. There is still a lot to be done. ‘The Configuration ‘states:

  1. relieving teachers are available when teachers are absent from duty.

The facts are that this is achieved in very few States and Territories. ‘The Configuration’ further states:

  1. 10 per cent of the total staff working hours to be distributed among staff for recognised administrative duties.

This target is achieved. It continues:

  1. enough additional primary teachers to allow release of teachers from direct classroom instruction for two hours per week.

On an Australian average this would require an additional 1,200 teachers- a long way from target. ‘The Configuration ‘ further states:

  1. new teachers to have a 10 per cent reduced working load in the first year of service.

There were 9,400 new teachers in 1978. An additional 900 teachers would be required to achieve this target. “The Configuration’ further states:

  1. an average of five days per year for attendance at inservice programs aimed at professional development.

The facts are that it would need an additional 3,000 teachers. The next factor is:

  1. classroom aides at the rate of one full-time equivalent per 250 students in primary and 1 50 in secondary.

The rate is one full-time equivalent for 230 primary/infants students and one full-time equivalent for every 166 secondary/technical students. I suppose those figures are quite good. The Configuration ‘ further states:

  1. clerical assistance equivalent on a full-time basis to one per 400 students in primary schools and one per 200 students in secondary schools.

At the moment the rate is one full-time equivalent for every 478 primary students and every 223 secondary students. The final factor is:

  1. sufficient cash resources to obviate the necessity for semi-compulsory fees in government schools for the purchase of needed equipment and consumable resources.

At an average of $30 a student this would cost an additional $70m. So one must query how close we really are to the targets. Of even more concern was the survey that teachers carried out into country schools. This is why I mentioned this fact to the honourable member for Darling Downs (Mr McVeigh) who I thought would have been very concerned about this matter. I will comment on what the teachers found in conducting a stratified random survey of 591, or 14 per cent of, country schools. They found that country schools throughout Australia are characterised by the inadequacy of buildings in secondary schools, the lack of remedial teaching staff in primary schools and overcrowded classes in the majority of country primary schools. That is really an indictment after aU the effort that has been put into the matter. The survey goes on further to comment:

The situation that exists in Australia generally also exists in the country schools. 49 per cent of those students perceived by their teachers to be needing migrant or intensive English were receiving no extra assistance, 60 per cent of those students perceived by their teachers to be needing remedial number help were receiving no extra assistance and 49 per cent of those students perceived by their teachers to be needing remedial reading were receiving no extra assistance.

Surely these are factors which indicate that despite the effort that has been put in and despite what has been happening, as a matter of responsibility we in this House should be discussing these matters and seeing what the answers are, instead of letting the great education debate and the concern for it just die. The investigations found that country children, particularly primary school students, were less likely than city children to be receiving the help that they required. The survey states:

Nearly three quaners of the students in country primary schools who need extra help with number work are missing out on that assistance, and over half the students in country primary schools who need remedial reading help do not receive that assistance.

There are not the specialist teachers in the country. The survey found:

The ratio of total teachers to specialist teachers in country schools is 14.7 whereas for Australian schools generally, the ratio is 11.3.

One of the other matters for concern in this age of unemployment is the fact that careers counselling in country schools is totally inadequate. All that is provided is 1.3 hours a year for each student in secondary schools in small country centres and 3.8 hours a year on average for students in larger country centres. We already have a situation in country areas where the job opportunities for the children are limited. They have more problems with their careers counselling than the students in city areas have. Yet there is this lack of facility for career counselling in those country areas. If one looks at the school building program one would see that the country schools have far worse than average conditions. That is one of the problems with our capital expenditure. The Schools Commission realises that these problems have to be overcome in country areas. It has made recommendations to the Government.

Mr Yates:

– Are they well taught in the country?

Dr JENKINS:

– The honourable member for Holt asks: ‘Are they well taught?’ That is important but I would have thought that any honourable member would have heard that 49 per cent of those students perceived by their teachers to be needing migrant or intensive English were receiving no extra assistance, 60 per cent of those students perceived by their teachers to be needing remedial number help were receiving no extra assistance and 49 per cent of those students perceived by their teachers to be needing remedial reading were receiving no extra assistance. Surely this assessment shows that we do not have those conditions that are required or the staff that is required. Whatever the quality of teaching, the present numbers of teachers can do only a certain job. Those are the defects in these areas.

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

Question resolved in the affirmative.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr Viner) read a third time.

page 3357

STATES GRANTS (TERTIARY EDUCATION ASSISTANCE) BILL 1978

Second Reading

Consideration resumed from 15 November, on motion by Mr Staley:

That the Bill be now read a second time.

Question resolved in the affirmative.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr Viner) read a third time.

page 3357

BILLS RETURNED FROM THE SENATE

The. following Bills were returned from the Senate without amendment:

Atomic Energy Amendment Bill ( No. 2 ) 1 978. Customs Amendment Bill 1978.

page 3357

QUEENSLAND GRANT (SPECIAL ASSISTANCE) BILL 1978

Second Reading

Debate resumed from 15 November, on motion by Mr Howard:

That the Bill be now read a second time.

Mr WILLIS:
Gellibrand

-The Bill before the House gives effect to the Grants Commission recommendation that a special assistance grant of $2 1.7m be paid to Queensland this year. This sum is broken up into two amounts. The first amount of $5. 7m is a completion grant for the year 1976-77. The second amount of $16m represents an advance grant for the financial year 1978-79. The Opposition does not oppose this legislation. The purpose of these grants is to compensate a State for its lower revenue raising capacity than the more populous States and for the greater costs of providing services than in those States because of such factors as distance and population spread. The grant represents a final calculation of the amount needed to put a claimant State on the basis of being able to provide services to the same standard as in the more populous States, that is, New South Wales and Victoria, if that claimant State were to utilise its taxable capacity to the same degree as those States. Some of the difference in taxable capacity is made up by higher per capita payments under the tax sharing arrangements.

If the State still believes that it is at a disadvantage with regard to revenue or expenditure it can claim a further payment through the Grants Commission. The only claimant State in 1976-77 and so far in 1978-79 is Queensland although I hasten to add that Tasmania which has not been a claimant State in recent years has lodged a claim in respect of the 1977-78 financial year. This payment is assessed by a very detailed investigation by the Commonwealth Grants Commission into the revenue and expenditure needs of the claimant State. The revenue needs are assessed by calculating the amount of revenue the State could have raised if its taxes and other charges were at the same level of severity as the average of those in New South Wales and Victoria and by comparing that sum with the amount that would result from applying the average per capita revenue of New South Wales and Victoria to the whole population of Queensland. The difference between these two amounts is the measure of the claimant State’s need for financial assistance arising from its lower capacity to raise revenue in practice.

Queensland’s taxable capacity is rather below that of the other States. Half the revenue lost resulting from its lower taxable capacity is made up by its greater capacity to raise revenue from mining and land. The prime reason for the lower taxable capacity per head in Queensland is simply that its income per head is the lowest of all the States. That is perhaps a surprising fact to learn given what one hears about Queensland and what we know about its natural advantages. Details relating to this fact are contained in the Grants Commission report. Table C-12 on page 127 shows that in 1976-77-the latest year for which statistics are available- the personal income per head of population in Queensland was $4,563 compared to an Australian average of $4,995. Queensland had the lowest figure of all the States. The next lowest was Tasmania with $4,696. That is a broad indicator of the lessened taxable capacity of a State. It is also reflected, as one would expect, in the lower levels of personal consumption expenditure per head of population. Tables relating to that factor are contained on page 1 3 1 of the Grants Commission report. The tables show that in 1976-77 Queensland had the lowest personal consumption expenditure per head of population of all the States. It was 9.3 per cent below the average. The figures indicate broadly that this State which has many natural advantages nevertheless has the lowest figures of all the States in respect of income and, therefore, has a diminished taxable capacity compared with the other States.

A claimant State is assessed to have an expenditure need when it has to spend a larger amount per capita than the average per capita cost in New South Wales and Victoria in providing a government service of the same range and quality as in those States. The Commission found that, because Queensland has a higher proportion of its population in the age group of 0 to 18 years than New South Wales and Victoria, it has need for a greater per capita expenditure on child welfare, for instance. Similarly, it found that Queensland’s higher ratio of farm units of population than Victoria and New South Wales increases its expenditure needs on services for agriculture. I note also that an assessment is made of Queensland’s needs for higher per capita expenditure on police. This is because of the remote and sparsely settled areas of Queensland and the cost of providing police services to them.

I say in passing that I hope the Grants Commission, in determining grants in the future, will not give such dispersal of police services any added weight because of the Government’s periodic calling in of police from outlying areas to Brisbane to prevent people undertaking their democratic rights to march in protest through that city. The cost of administering this undemocratic law is enormous. It has certainly cost Queensland millions of dollars. I sincerely hope that the Grants Commission will not in any way recommend that the Commonwealth subsidise such blatantly undemocratic behaviour by the Queensland Government. If it did so recommend, we would be obliged to take a harsher view of the legislation giving effect to such a recommendation than we have taken of the legislation now before the House.

The report of the Grants Commission is extremely detailed. It contains a great deal of comparative information regarding expenditure, revenue, economic circumstances and performance of the various States. In the context of this Bill, it is particularly relevant to look at the comparative level of expenditure on important services provided by the State governments. I refer to page 156 of the Grants Commission Report. Table E-7 indicates net State expenditure on certain social services from Consolidated Revenue and special funds. It also shows the total amount spent by various States on various social services on a per capita basis. Queensland’s performance in this regard is appalling. The total amount spent by Queensland on social services per capita is 12V4 per cent below the average of the six States. It is the lowest of any State. The total amount spent by Queensland per capita in 1976-77 was $308.06 compared with a State average of $351.97. In this regard, Queensland does not fare well.

In table E-6 on pages 154 and 155 of the Grants Commission Report, expenditures on social services are broken up into more detail. I ask the House to consider the deficiencies in the services provided by Queensland in these important respects: On secondary education, the expenditure per head by Queensland is 27.2 per cent less than the average of the six States. On technical education, expenditure per head by Queensland is 23.2 per cent below the average of the six States. On libraries and museums expenditure by Queensland is 23.4 per cent below the average of the six States. The total in this education area which includes those I have mentioned- primary education, training of teachers and so on- is 11.7 per cent below the average of the six States. With regard to health, hospitals and welfare for public health, Queensland spends 41.1 per cent less per capita than the average of the six States. In respect of hospitals, an area where one would have thought Queensland had a lot to be proud of, given the history of free hospitalisation in that State, we find that it spends 8.4 per cent less per capita on hospitals than is the average for the six States. On mental hospitals Queensland spends 36.7 per cent less per capita than the average of all States. With regard to relief of the aged, indigent and infirm- one would have thought a very worthy area of expenditure- Queensland spends 57.4 per cent less per capita than the average of all the States. With regard to recreation, Queensland spends 34.4 per cent less than the average of all the States. On child welfare, Queensland spends 18.6 per cent less than the average of all the States. In this total area of health, hospital and welfare, Queensland spends 21.5 per cent less than the average of the six States for such per capita expenditure.

However, perhaps not surprisingly, Queensland expenditure on police is above the average of that of the six States- 2.8 per cent above the average. There we see by looking at those tables a rather remarkable exposition of the degree to which the State of Queensland has given extraordinarily low priority to expenditures on what one would have thought were absolutely essential and very worthy areas of expenditure. It is an appalling record that the expenditure in those areas is so low, particularly- I emphasise this- as the very legislation that we are now discussing is designed and its very purpose is to enable the claimant States- in this case it is Queensland- to be able to provide services which are at the same standard and quality as those provided by the more populous States. That is what this legislation is all about.

Queensland has been getting these grants since 1971 and yet the standard of service that it provides per capita is quite clearly far below that of the other States in these very many worthy areas. That is an extraordinary indictment of the administration and government of the State of Queensland. It is a factor which should be borne in mind by the people of Queensland that they are getting a level of service in these very important areas of education, health and welfare which is far below that being provided by the other States, despite the fact that their own government is being funded by the Federal Government specifically with funds designed to enable the Queensland Government to provide services which are of the same standard, quality and range as those provided by the other States. This is an extraordinary revelation and one which should be borne in mind by the members of this House and by the people of Queensland. In conclusion, it is also relevant in this context to bear in mind that Queensland was the leader in the abolition of probate as it is called at the State level. Queensland has sacrificed revenueperhaps it is politically popular to do it- but it has sacrificed an important area of revenue.

In 1976-77 the amount was $25m and since 1 January 1977 no probate has been applied on estates in Queensland. Queensland has abandoned this area of taxation. It is true that other States have moved towards the abolition of probate but by being the leader Queensland has suffered a loss of revenue which is not made up in any way by equalisation grants such as the one we are discussing at the moment. Therefore, having lost that revenue, it has to make up that revenue from some other area or reduce services even more. I think the most likely thing that the Queensland

Government would do would be to restrict the level of services it provides even more than it has done hitherto. Of course this is the other side of the coin.

If you lose the revenue from such taxation areas as probate which apply only at levels which are relatively high- although at the State level that is less true than it has been in the federal area- there has to be some other loss somewhere else; either you raise taxes in some other area or you reduce services; it may be that you do not expand services. In Queensland there is clearly a desperate need to expand the services in the health, education and welfare area. If you lose this kind of revenue on probate then you suffer either from increased income taxes or reduced services. In Queensland there is no scope whatever for a reduction in the standard of services as they are already far below that of the other States. The disadvantaged people of Queensland, those who are the most disadvantaged, the most dependent on these sorts of services, are the most disadvantaged people in Australia and are the ones who suffer most from such moves as the total abolition of probate.

Mr HODGES:
Petrie

-At the outset I wish to mention a couple of points that were made by the honourable member for Gellibrand (Mr Willis). I apologise for not being present during the entire speech. However, he was rather critical of the Queensland Government in its provision of certain services. I say to him in relation to his selective criticism that the Queensland Government has an excellent electoral record over the past 20 years or so and indeed I think it has the best record of any State government or of any political party in any State in the Commonwealth. It is the democratic right of every State in Australia encouraged by the Federalism policy of this Government that the States have the right to select their own priorities. On occasions I am rather critical of the Queensland Government but the people of that State are happy with the government they have; their electoral record reflects their satisfaction. The people have rejected the Labor Party in Queensland and I would suggest to the honourable member that the Labor Party in Queensland would be the weakest of any division in the Commonwealth. One cannot get past the will of the people and the will of the people in Queensland is very strong for the non-Labor parties.

I wish to speak tonight specifically to the fortyfifth report of the Commonwealth Grants Commission which recommends, as the honourable member who preceded me has stated, that Queensland receive a special grant of $2 1.7m in the 1978-79 financial year. This special grant is over and above the $795m that Queensland automatically receives from the Commonwealth as general revenue from the tax sharing arrangement during the same period. It is also over and above the $42 8. 7m which Queensland received from the Federal Government in the form of specific purpose recurrent grants- the third highest in the Commonwealth. One surely may ask the question: Who is it that says Queensland does not get enough Federal aid? It should be pointed out that since the Grants Commission was established in 1933, none of its reports has ever been rejected or modified by any Commonwealth Government regardless of that government’s political persuasion. This reflects in no insignificant way the high regard and the impartial nature that have come to be hallmarks of the Commonwealth Grants Commission.

These are characteristics which are unique not only in Australia but indeed in federal systems throughout the world. Consequently, I will devote some time to considering why this is so and why the Grants Commission came into existence. A second aspect which I believe patently warrants some discussion is the concept of horizontal fiscal equalisation; that is, the equalisation between the States where this special grant is aimed towards equalising Queensland’s fiscal limitations to that of the other wealthier or more affluent States.

I also want to comment on the criticism that has been levelled against the Commission in recent years, criticism which is unfounded on any facts and based on uninformed observations which has led to what I term as illogical conclusions. I want firstly to look at the history and background of the Grants Commission. It became obvious a few years after Federation that the less populous States, namely, Tasmania, South Australia and Western Australia needed extra Commonwealth financial assistance. As a result special grants have been given to Western Australia since 1910-11; to Tasmania since 1912-13; and to South Australia since 1929. However, the threat of secession by Western Australia and the difficulties imposed by the Great Depression made the need for these equalisation grants even greater. What is more, special grants were being given on inconsistent sets of guidelines or by any one institution. Often it was given to the Commonwealth Public Accounts Committee to investigate the States’ claims. In June 1931 the Public Accounts Committee recommended:

The time has arrived when a permanent body should be appointed to make a continuous study of the financial relations of the Commonwealth and the States . . .

Prime Minister Lyons said when he introduced the Bill to establish the Commission: the Government feels that there should be a comprehensive investigation of the whole case by the one body. When one commission is sent to inquire into an application for a grant by Tasmania, and another into a similar application by Western Australia . . . it is not possible to obtain any degree of uniformity in the recommendations.

That quote came from the House of Representatives Hansard record of 18 May 1933. Consequently Prime Minister Lyons went on to say:

The Government now desires that a comprehensive investigation shall be made by an impartial body which does not owe allegiance to either the Commonwealth or the States.

The Government let the Commission decide its methodology. The Commission very early rejected arguments that special grants should be based on the principle of compensation for disabilities resulting from Federation, for poverty of resources or for inequalities among individual citizens. Instead it adopted the following criteria:

Special grants are justified when a State, through financial stress from any cause, is unable efficiently to discharge its functions as a member of the Federation and should be determined by the amount of help found necessary to make it possible for that State by reasonable effort to function at a standard not appreciably below that of other States.

That quote came from the Grants Commission third report in 1936. Thus the concept of fiscal horizontal equalisation was clearly stated. Over the years, the methods and nature of special grants have changed. Firstly. there has been a shift from minimum needs to full Budget equalisation as the purpose of the grants. Secondly, there are new methods of calculation whereby the claimant State’s financial needs have come to be assessed directly by reference to differences in revenue raising capacity and costs of providing services instead of indirectly by reference to differential Budget results.

In recent years the proportion of funds going to the States as a basis of the Commission’s recommendations has declined. This is partly because Queensland is now the only claimant State, partly because of the success of the Grants Commission’s operations and partly because of the use of equalisation measures in other Federal grants to the States which I will detail a little later. Suffice to say at this juncture that the Commission was founded on a semi-judicial basis. Appointments to the Commission were on fixed tenure, dismissal was only by approval of both Houses of Parliament, evidence was taken on oath and persons of very high calibre were appointed. This tradition continues today and the uniqueness and value of the Commission are best summed up by Professor Russell Matthews who stated:

The Grants Commission’s procedures almost certainly represent the most sophisticated and systematic application of equalisation principles in any country- federal or unitary.

No other country has made provision for such detailed assessment of financial needs by an independent, quasi- judicial body. Central governments in many countries make equalisation grants to provinces . . . but, the grants are usually based on ad hoc or political assessments . . .

The Grants Commission has helped the smaller States to overcome the haggling and bazaar-like bargaining which all too frequently pervade intergovernmental relations in Australia. It is, without doubt, an impartial body which should have the respect of all political parties and all units of government-State and Federal. Any State which believes it is facing certain problems can apply to the Grants Commission for an independent assessment of its difficulties.

I turn now to horizontal fiscal equalisation. As well as the Commission’s special grants, the smaller States such as Queensland have received further subsidy over the more populous States by, firstly. specific purpose grants provided under section 96 of the Constitution. They may be for roads, universities or other things. Many of these grants include equalisation factors- for example, for vastness of the State, distance to be traversed by roads and the number of school children. They are just a few examples. Secondly, these States receive further subsidy by financial assistance grants which operated up to 1975. They were based on formulae that had certain elements that would favour some States- for example, the number of children attending school, distance factors, wage and salary movements, et cetera. Under the new federalism arrangements equalisation is assured by the same State relativities for general revenue, tax sharing grants, as the financial assistance grants. The four less populous States remain free to apply to the grants Commission. State surcharges by smaller States were to be equalised by the Commonwealth. That point has not been generally recognised in relation to the operation of the Grants Commission and the Fraser federalism policy. State relativities and general revenue assistance per capita are contained in a table which I seek leave to have incorporated in Hansard.

Leave granted.

The table read as follows-

Mr HODGES:

-I thank the House. This table clearly shows that the average per capita payment was $272.08. Victoria received $223.60; Queensland received $323.72 and Tasmania received the most with $455.38. One can see from this table the equalisation that comes about as a result of consideration of the capacity of the less populous States to raise revenue.

I want to look specifically at the position in Queensland and the criticisms of the Commission. I turn now to the question of Queensland’s assistance from the Grants Commission. Queensland first became a claimant State in 1971. 1 understand that the honourable member for Lilley (Mr Kevin Cairns) wishes to make a few brief comments in relation to this matter later. Since that time it has received special grants from the Commonwealth based on Commission recommendations. Once again I seek leave to have incorporated in Hansard a small table which indicates the figures.

Leave granted.

The table read as follows-

Mr HODGES:

-I thank the House. These finally adjusted figures show that in 1971-72 Queensland received $9m. The figure rose to a peak of $35. 8m in 1975-76 and in this financial year the amount is $21m. Thus the Queensland Government has considered since 197 1 that it requires special assistance from the Commonwealth over and above the extra equalisation grants which the State receives in the form of general revenue and specific purpose grants which I mentioned earlier. In 1975-76 Queensland received $416.28 per capita in general revenue and specific purpose grants. New South Wales and Victoria on the other hand received only $359.76 and $364.08 respectively per capita. The Commission in making its recommendations looks at the revenue capacity and expenditure needs of Queensland. I emphasise the words ‘the revenue capacity and expenditure needs of Queensland’. I emphasise this capacity because the Commission calculates the capacity of Queensland to raise income compared to the two standard States of New South Wales and Victoria. It does not consider the actual revenue raised by Queensland but rather its capacity to raise revenue. That is the point I want to emphasise. Thus, if Queensland decides to reduce its taxes- as it has in death and probate duties and payroll tax, which I think was referred to by the honourable member for Gellibrand (Mr Willis)- The Commission will not take this as a reduction of capacity by Queensland. Similarly, if Queensland decides to spend more money in certain areas such as forestry- I use that as an example- the Commission does not consider this a higher expenditure need as this is a decision which the Queensland Government has made.

I turn again specifically to the Queensland situation. Queensland has received since 1971, including this year’s grant, a total of $ 182.65m in special grants. To some members of the Parliament and the public this extra assistance, which no other State receives at the moment because the other States that were claimant States have not made such approaches in recent years, may seem to be somewhat incongruous. It may seem somewhat incongruous considering that the Queensland Government has been bragging constantly about Queensland’s wealth, about its growth and about the significance of its mineral exports to Australia. I want the honourable member for Lilley (Mr Kevin Cairns) in particular to take note of what I am saying at the moment. It seems even more incongruous considering the Queensland Premier’s oft repeated but never attempted threat to make Queensland secede from the Commonwealth.

Mr Kevin Cairns:

– Why pick on me.

Mr HODGES:

– I am not particularly belting into the honourable member for Lilley. I just want to make the point specifically because he and I are at somewhat of a difference in relation to this particular matter.

Mr Bradfield:

– He should listen.

Mr HODGES:

– I take the point raised by the honourable member for Barton that the honourable member for Lilley should listen to what I am saying. In 1973-1 want the honourable member for Lilley to listen to this in particularthe Premier was reported to have said that he would ‘not hesitate to take the necessary steps for a referendum on Queensland’s secession from the Commonwealth if circumstances warrant it’. That was reported in the Age on 14 May 1973. On 1 August, the Press reported: ‘Joh seeks full home rule for Queensland’. That again appeared in the Age on 1 August 1974. The report also stated that he was ‘poised to call in the United

Nations to investigate dissatisfaction over Australian rule in Queensland’. This is a laughable situation. The Premier of Queensland for whom, in many respects, I have a great regard, talked about going to the United Nations and expressing dissatisfaction over Australian rule in Queensland. It is strange indeed that Mr Petersen has attacked the United Nations in recent times, yet he saw fit at that particular stage to call on the United Nations to intervene in Queensland’s position in relation to the Commonwealth. But, of course, Mr Petersen is well known for his inconsistencies. On 8 November 1976, the Premier again hinted at secession and said that Queensland ‘did not really need the rest of Australia’. That was reported in the Australian on 8 November 1976. This view was expressed again on 24 March 1977, in the CourierMail. The Premier stated:

Queenslanders are paying dearly to be pan of the Australian federation . . .

He stated further . . without Queensland, Western Australia and Tasmania, Australia would go broke.

What a crazy state of affairs this is. If that is the case why is Queensland- a claimant Staterequesting additional funds from the Commonwealth through the Grants Commission and also through the general revenue and specific purpose grants. It is interesting to note that Tasmania receives twice as much in general revenue grants as Victoria. Inconsistency and illogical statements seem to be the basis of the Queensland Government’s action. I challenge the Premier and the Queensland Government to hold a referendum on the secession question and to stop talking such utter hogwash. As well, if Queensland is doing so well, then the State should not seek special grants because, according to the Queensland Government, it does not really need them anyway. I hope that the honourable member for Lilley is listening to my comments in relation to this matter. Queensland now has the power to raise extra revenue through an income tax surcharge. I hope the honourable member for Lilley recognises that point also. The Queensland Government has the power to raise this extra revenue through a surcharge if it believes it needs more revenue for local government or for the development of the State. That is the great virtue of Fraser federalism.

Mr Bradfield:

– They could get a refund.

Mr HODGES:

-They could get a refund, as the honourable member for Barton has stated. If the Queensland Government believes that the residents of Queensland deserve a refund then it can make that decision. In 1976 the Queensland

Premier signed a document- I have had a look at it- requesting that income tax powers be returned to the States in the manner established by the new federalism policy. On 12 April 1977 the Premier said that the Commonwealth should give back income tax powers to the States. Yet, only a fortnight before the Premier said that Queensland does not want to go into State income tax at any stage ‘.

Mr Yates:

– He is a schizophrenic.

Mr HODGES:

-Somebody said that the Premier of Queensland is a schizophrenic. I will not go as far as the honourable member who made that suggestion. I will say that there is a tremendous amount of inconsistency in the argument of the Premier of Queensland. I think that ought to be emphasised. Similarly, Mr Petersen has repeatedly requested Canberra to lower income taxes. That was commented on in the Australian on 20 April 1977. He even proposed that sales tax should be halved. These are laudable objectives but it is only cheap politicking because Queensland is always criticising the Commonwealth and asking for more funds. I have a file in which I place every Canberra bashing statement that comes from the Queensland Premier, a Queensland Minister or a Queensland member of Parliament. The file at the moment is so high that a kangaroo could not jump over it. The file, of course, has only been in operation for two years. The temporary Queensland Treasurer, Mr Knox, recently stated:

Give Queensland a fair go or else.

That statement appeared in the Courier-Mail on 15 March 1977. How can the Commonwealth reduce taxes and increase funds to the State? The States have to be realistic and they are certainly not being that. The question I ask is: Has Queensland tried to raise revenue within its own capacity?

Mr Bradfield:
Mr HODGES:

– The answer is: ‘Not to a sufficient level’. For years it argued that its mineral royalties were high enough. It said so in its original submission to the Grants Commission in 1971. Further investigation by the Commission showed that Queensland was making a relatively -

Mr DEPUTY SPEAKER (Mr MillarOrder! The honourable member’s time has expired.

Mr KATTER:
Kennedy

-This debate has been quite remarkable. At this low of the night I would have imagined that some constructive comments would have been made in relation to this Queensland Grant (Special Assistance) Bill. It appears to me that it is a grand old night out to shoot down the Premier of Queensland. There is just one thing wrong with people who have almost an unbelievable hatred of the Premier of Queensland. I think most of those people would like to have the attributes that he has which make him probably one of the most outstanding leaders this nation has ever had. I am not saying that I agree with everything that he does. Our rather immature shadow Minister for Trade and Resources, the honourable member for Blaxland (Mr Keating) is grinning to himself in his normal manner. Can honourable members imagine making a comparison between the honourable member for Blaxland and the Premier of Queensland. It would be so laughable that I would not waste time on it. I would have thought that anyone contributing to this debate would have attempted to give some sort of evidence as to why this $2 1.7m is to be made available to Queensland.

Before I deal with that, I shall refer briefly to one of the comments made by the honourable member for Gellibrand (Mr Willis) in particular. He made great play of the fact that Queensland ‘s expenditure in certain departments was much less than that in other States. Let us look at the question of health. To me, it is perfectly obvious why the expenditure per head of population in Queensland is somewhat less than that in other States. In Queensland we do not have abortions on demand. Queensland people wanting abortions go south. We do not have the same sort of carnage on the roads that they have in other States. If one visits the Royal North Shore Hospital in Sydney one will find ward after ward filled with paraplegics and tetraplegics who cost the State tens of thousands of dollars. That is why expenditure on health in Queensland is less than in other States. Queensland is a fairly healthy State.

I pay tribute to the honourable member for Lilley (Mr Kevin Cairns) who came under a little bit of fire a few minutes ago. It was due to the agitations of the honourable member for Lilley that attention was drawn to the absolute necessity of Queensland getting the extra millions of dollars to balance its Budget. Let us examine the general spectrum of the earnings of this nation. Let us look at the per capita capacity, desire and productive capacity of every Queenslander against those in other States. Is it just our natural resources? Not one damn bit of it. It is the development of those natural resources. It is because of the people who stay out in the inland areas and are there to this very day. Many of these people have never seen a television test pattern in their lives. These are the people who sustain the industries which are producing a great part of the wealth of this nation. Associated with this development is the infrastructure- the building of roads and building homes around mining settlements. ‘Oh’, honourable members may say, Utah built a town at Blackwater’. But remember the skills and remember all of the various elements that the State government has to contribute. It is beyond its capacity to keep pace with the exciting and accelerating development of Queensland. The difficulty is that honourable members wish they were Queenslanders. God damn it, take for example this man sitting here, the honourable member for Blaxland (Mr Keating). People from his State are pouring across the border into Queensland to become Queenslanders, to enjoy the rule of Joh BjelkePetersen.

Opposition members- Oh!

Mr KATTER:

-The answer is there. Honourable members opposite sneer and go on. At this hour of the night, they probably do not know what they are doing. The point is that figures are what tell the story. People have poured across the border into Queensland. We are finding it hard to accommodate them. But we will manage.

Mr Deputy Speaker, I wish to point again to some of the necessities of our having these extra millions of dollars in Queensland. There is the question of airport development. There are more airports in my electorate of Kennedy than in any other electorate in Australia, and most of them are sustained, developed and maintained by the local authority. If the local authority is drawing from one particular fund, it is running short in another fund. So it looks again to the State Government to give it sustenance, assistance and subsidies to create employment and to make up for the necessity of maintaining airports. Then there is the question of roads and bridges and their maintenance. Is all that coming from the Federal Government? A very generous part of it is, certainly. I agree with the honourable member for Petrie (Mr Hodges) in that regard. But there is a tremendous imbalance which has to be met by such grants as this $2 1.7m for which we, the people of Queensland, are infinitely grateful to the Government. I hope that the Minister for Aboriginal Affairs (Mr Viner), who is at the table at the moment, will tell the Treasurer (Mr Howard), the Prime Minister (Mr Malcolm Fraser) and the ministry generally that we appreciate this assistance.

It is quite silly to go on as did the honourable member for Gellibrand (Mr Willis) and point out the discrepancies in the Queensland situation. There is another matter, the matter of water. Queensland is a very arid State. It is a State which is bursting at the seams with development and in almost every case we face the unfortunate fact that mineral resources are found in isolated places. It just seems to be one of those things that the good God has decreed. We have to find water to sustain those industries. The lifeblood of any industry is a water supply. So, if I might cite a parochial example, in our own area we find the Julius Dam being sustained to a very great extent by the Queensland Government. Again we have the necessity of getting this grant of $2 1.7m.

The money is being invested; it is being well spent; it is being provided to an exciting and developing State, a State which has a Premier who has made an impact not only in Australia. I remember having lunch on Capitol Hill with a group of United States senators. It suddently occurred to them that I came from Queensland. They said: ‘Wait a minute. You are from the State with that pistol packing Premier. By God, man, we could do with him over here. ‘ That was on Capitol Hill in the United States. Anyone who knows me and who knows my background will know that I totally disagree with the Premier on many matters but he is the greatest Premier in Australia. It is as simple as that. These fellows hate him. If he can make them hate him and constantly hate him, it shows that he is making an impact. One does not kick a dead dog. We see these lightweights, these Johnny-come-latelys who are attempting to make some sort of impact with their few scattered numbers on this side of the House, making themselves look ridiculous by getting up and trying to denigrate a man who has made a great impact on this nation and beyond it. Let me say, finally, that never has the Federal Government made a greater investment than it has with this $2 1.7m. It will lead to greater development in Queensland and it will lead to greater money pouring into the Federal Treasury.

Mr KEVIN CAIRNS:
Lilley

– It was a delight to listen to the honourable member for Kennedy (Mr Katter) and to realise the universal support and approbation throughout this House, not only from the Government side but also from the Opposition side, for what he has said. One could feel the support growing by the minute for everything that he said. I am delighted to follow him in this debate tonight.

I am also delighted in a special way to speak to the Commonwealth Grants Commission Bill. For many years I tried to persuade the Queensland Government to approach the Commonwealth Grants Commission as a claimant State. There were others who helped. A notable journalist, Wallace Brown, helped in that campaign from 1966 to 1971. As a result of that approach this application as a claimant State has been worth $250m to that State. I am delighted that that has occurred. I know that all honourable members in this House will support the proposition that it should occur. I will refer to one or two points with respect to the Grants Commission report and will then make a wider case of matters that presently are not being considered by the Commonwealth Grants Commission but which are very important.

For the first time, this Grants Commission has considered a case by the State Treasury that the cash grants which are in substitute for a proportion of the loan funds should be taken into account for the equalisation measures between the States. I pointed this out in 1974, in 1975, in 1976 and last year. I am pleased to see that for the first time the argument is being promoted. Simply put, it is this: Over the years the allocation for the loan funds for the various States has rested upon history. States which initially had a low allocation under the loan program were consequently able to get a fairly low proportion of assistance through capital grants. It has certainly meant that the assistance to the States which was first developed in 1970 under the Gorton Government and which had been carried on since to make capital grants for nonrevenue purposes free has assisted some States more than others. Therefore, the point to which Queensland had a low loan allocation reflected the extent to which it received less assistance through that scheme than would otherwise occur.

I hope that, as the years go by, the Commonwealth Grants Commission will see the merit of that case. I do not believe that it is sufficient to say that, because Loan Council allocations are consummated by the Commonwealth and the States according to a certain formula, therefore, the consideration of the effect of those allocations as between States should be ignored completely. I do not agree with that proposition. If that proposition were to apply, all kinds of section 96 grants would be excluded from valid consideration in this respect.

I refer to one point, perhaps the crucial point, that may have been missed by the honourable member for Petrie (Mr Hodges). This measure concerns fiscal equalisation. It concerns an attempt to provide equalisation in terms of Government services between one State and the other States of the Commonwealth. Originally Queensland would not go to the Commonwealth Grants Commission because it was persuaded that, by doing so, it would lose its free hospital scheme. That assertion was always incorrect. In 1971, the State grasped the nettle and went to the Commonwealth Grants Commission. It did not lose its free hospital scheme. Other events intervened in the meantime.

So, fiscal equalisation applies only in respect of government revenue, government expenditure and the provision of government services. But that does not mean that there is to be a much broader economic equality. I would suggest that the Commonwealth Grants Commission should take into account other measures in order to look at the wider measure of equality as between States. It ought to take into account the matter of the application of tariffs and quotas and of the external trade policy effects as between the States of Australia. Unless it does this, there will always be some parts of the country which may have a greater net value added from each input into their industry but which will have a lower standard of living. That is precisely what is happening in Australia at the moment. Queensland happens to be the second great exporting State of this country. It is second to Western Australia in the amount that it exports per person in the State. I ask the House to consider this: Should a State in that position have one of the lowest standards of living in Australia? One has only to state that proposition to see how absurd it is. I ask the House to consider why that is so. It is so for one overwhelming reason- the effects as between the States of Australia of the application of tariffs and quotas. I have already made application this year to give some evidence at the hearings of the Commonwealth Grants Commission to discuss those matters. Unless they are discussed, equality will never be achieved, and equality will be to the economic benefit of Australia. I have never believed that the subsidisers should have a lower standard of living than those who are receiving the subsidy. Yet in fact that is what occurs. Why should the matter of the application of tariffs and quotas as between States be considered? In the first speech in this House on the Bill setting up the Commonwealth Grants Commission, Prime Minister Lyons had this to say in 1 933:

If a State feels that as a result of, say, the operation of the tariff, it is suffering disadvantage, there will be nothing to prevent it from not only putting that to the Commission as a reason why it should be assisted, but also assessing the value of that disadvantage.

That has never yet been done in a considered and ordered manner. In the first report in 1934 the Grants Commission listed the matters for consideration by the Commission for subsequent years, and on page 12 of its report it stated:

The more important of these factors may here be enumerated:

There are 12 factors listed, but I will read only two:

  1. The diversity of the States in size, population, natural resources and state of development;
  2. b) The effect of the tariff policy of the Commonwealth;

This matter was foreshadowed by Prime Minister Lyons. It was foreshadowed in the first report of the Commonwealth Grants Commission. In the second report of the Commission at page 10 it considered this matter again: the States asserted that these losses had been accentuated by Commonwealth policy, particularly the tariff.

The report went on:

The idea that all the potentialities of Australia should be developed had led to the adoption of a policy for the encouragement of secondary industry, and the instrument selected for this purpose was a protective tariff.

The question that needs to be asked by the States is this: What enables the standard of living to be achieved in those parts of Australia which are protected by the tariff? The answer is simple: The ability of industry to function in those States at less than the average rate of protection of the tariff. Simply stated, there is a transfer from the exporting States to the net importing States. What is the extent of that transfer? When I hear members in this House from either the Government or the Opposition pour scorn upon the Mount Isas or the Utahs or the Blackwaters of this world- on the coalmines- I believe that they are being incredibly absurd. The Chrysler Australia Limited factory in Adelaide, as with the Ford Motor Co. works in Melbourne, is enabled to pay the level of wages and profits that it does pay through the operation of tariffs and quotas. It is able to pay its workers and managers an amount in excess of the net value added as a result of its activity through the operation of the great exporting industries. There is a transfer from the export industries to those that are protected. That is the way it occurs.

I want to go over one or two other matters because they deal with the very principles of this legislation and I do not think that they have been previously dealt with in this House in this way. From the beginning of this financial year to the end of September about $900m- worth of subsidy equivalents were paid to industry in Australia through the application of the Budget but overwhelmingly through tariffs and quotas. The overwhelming part of that assistance went to the south-eastern corner of Australia. The overwhelming part of it went to Victoria and to a lesser extent South Australia. It was enabled to be paid in terms of the return to workers and managers in those industries because of the efforts of the exporting industries. More precisely, what has happened over the last six or seven weeks is that decisions have been made for tariff and quota protection. I do not disagree with that, but let us look at the size of the transfers. Assistance has been paid through tariff and quota protection since the beginning of October to the extent of about $130m. Those who pour scorn on the outlying States ought to remember that between $60m and $70m of that assistance went to Victoria. The rest was divided almost totally between New South Wales and South Australia. That is why the basic exporting States are always battling uphill to get a standard of living for their people equal to that which applies in the trade-protected parts of the Commonwealth.

Consider the assistance given since the beginning of October to the carpet industry and to the bed sheeting and linen industry, and remember that in one of those the net subsidy equivalent per person is $20,000 a year- yes, some of it applies to Victoria as well- and an extra bounty was given to that industry. That is all to the good, but let us understand who ultimately pays for it. Assistance was given to the manufacture of gear boxes and associated parts, to hosiery and underwear, to certain engines and so on, to the extent of $ 130m. In total, between 19,000 and 20,500 workers have received assistance through the decisions to protect those various industries. The amount of assistance which goes to people in my State would apply to between 800 and 900 workers. That is the ultimate disproportion that occurs and that is the ultimate disproportion that needs to be rectified. Those transfers need to be taken into account and must be taken into account when the other grants and loan funds and revenue funds are divided between the States. It will occur, and it ought to occur. In case the House might think that this is a theoretical argument and one that is not important, let me put it in this way: The disproportionate effects within a country of the application of protection policies should never be ignored. The events that led up to the United States Civil War were duc in large measure to the effects of protection policy advantage in the north and the feeling of grievance that lay upon the southern States. The honourable member for Lalor (Mr Barry Jones), with his sense of history, will immediatly recall the South Carolina resolutions, the nullification proposals.

Mr BARRY JONES:
LALOR, VICTORIA · ALP

– John C. Calhoun and all that.

Mr KEVIN CAIRNS:

– That is right. He made his name by that means, but he felt about it. They were not able in those days to formulate precisely the disadvantage but they felt that there was a disadvantage. What I am saying to this House is that that feeling of grievance as well as the slavery issue played its own part in the development of the American Civil War. In Australia that revolt of the south against the north owed its origins to some economic issues. In this country one has to be careful that a feeling of grievance on the part of the outlying States does not develop when they compare their situation with that of the protected States.

Dr Jenkins:

– Are you saying that Queensland is revolting?

Mr KEVIN CAIRNS:

– Let us not distort a serious proposition. If there is a growing inequality and people feel that there is a transfer of real resources from their industry to people living at a higher standard of living but having a lower net value of production, there will be a genuine sense of grievance. That cannot be avoided. It is the basis of a fair go for all. It also has its application in terms of a sense of fiscal equality. So I hope that the House will consider those matters.

In the early days of the Grants Commission it was hoped that those matters would be considered. It might be that the precise consideration of these effects are outside the terms of reference of the Grants Commission as they were defined in the late 1930s and, perhaps, as they are denned in the present legislation. Those matters must be considered. The Grants Commission legislation has to do with fiscal equalisation on the part of governments, but its interest extends no further. The other transfers in this nation must be considered and I believe that they will be.

I make one other point. As a result of such transfers there is, of necessity, a distortion in the exchange rate that applies to a country, and the exchange rate will be kept at a higher level than would otherwise be the case. That high level of exchange rate can help protected parts of the country but can disadvantage those parts of the country that export to the rest of the world. That is the second and significant distortion that deserves to be considered. I support this Bill. It is a very important Bill. I believe that the wider matters that are involved in it deserve consideration by this House and by the Parliament in the future.

Dr EVERINGHAM:
Capricornia

– I do not wish to detain the House, but I wish to reply to a few points raised by the last two speakers on the Government side. I accept the valid points made by the honourable member for Lilley (Mr Kevin Cairns), namely, that exchange rates, tariff and excise should be considered in making grants, when the Grants Commission is making determinations as between States -

Mr Kevin Cairns:

– And in a wider context too.

Dr EVERINGHAM:

– Yes, and in other contexts besides that of grants. I point out, however, that not only matters that are within the competence of the Federal Government, such as exchange rates, tariffs and excise but also matters that are within the competence of the States when there are inequalities in export earnings, particularly in the matter of mineral royalties, should be taken into account. Initially Queensland charged Thiess Peabody Mitsui 3d a ton royalty on coal when the Rockhampton City Council was charging 2/6d a ton royalty on gravel from the town quarry.

Mr Kevin Cairns:

– Did the gravel companies build a railway line?

Dr EVERINGHAM:

– The railways in Queensland made a loss this year. Later Queensland put up the royalty to Se a ton. It is only since the Whitlam era that the States have even started to look at the possibility of imposing something Uke a reasonable royalty on their minerals. In fact, when the Federal Government opts out of export charges on minerals that will be the time when the States could hop in and impose a higher royalty, if they are really interested in the long term value of their export earnings and not just in the fast buck and in getting as much exported as quickly as possible.

As to comparing the Utah Mining Co. with Chrysler Australia Ltd, the Ford Motor Company of Australia Ltd and so on within the manufacturing sector, it is true that we support our manufacturing industry. I dispute the claim that the earnings of workers in those industries are greater than the net value added. In fact, motor car manufacturing employees in Japan have a 20 per cent higher standard of living than their counterparts in Australia. The reason we can get Japanese cars cheaper than Australian cars is that the Japanese have more modern, more specialised and longer production runs. In fact, the Japanese are starting to export jobs from Japan to Korea to get the benefit of cheap labour. Japan is no longer a cheap labour area and the workers in General Motors-Holden’s Ltd, Chrysler and Ford works are approximately as efficient and as productive in their work as the Japanese.

I refer also to the point raised by the honourable member for Kennedy (Mr Katter) that Queensland spends less on social services because the people there are healthier. He mentioned hospitals in particular. He mentioned the number of paraplegics at the Royal North Shore Hospital. Paraplegics are in all States. Queensland has a bad record of road accidents. I do not know what its record has been in recent years, but certainly when I was in the ministry Queensland was one of the worst States for road accidents and road fatalities. If Queensland is spending less on paraplegics it is not because it has fewer of them but because the service offered is less efficient. Certainly in Queensland hospitals the level of staffing per bed is lower than in other States. Less is spent per bed in Queensland hospitals than in other States.

The diagnostic services there are provided largely- outside the capital city anyway- by Federal health laboratories. There are many other reasons for Queensland spending less on hospital services than the ones advanced by the honourable member for Kennedy. He mentioned abortions being performed outside Queensland, but 99 per cent of them are performed in private clinics and not in State hospitals. The only government funds that are helping them out are federal funds. So let us not get too emotional about the great paradise of Joh Bjelke-Petersen.

Mr DEPUTY SPEAKER (Mr Giles:
WAKEFIELD, SOUTH AUSTRALIA

-I call the honourable member for Fadden.

Opposition members interjecting-

Mr DONALD CAMERON:
FADDEN, QUEENSLAND · LP

– I wil make a very brief contribution to this debate. I have every right as a Queenslander to do so.

Opposition members interjecting-

Mr DEPUTY SPEAKER:

-Order! If the honourable member does not address the Chair I will ask him to resume his seat.

Mr DONALD CAMERON:
FADDEN, QUEENSLAND · LP

-You are not going to ask the honourable members opposite to cease interjecting?

Mr DEPUTY SPEAKER:

-No. You provoked them. Will you make your speech and get it over?

Mr DONALD CAMERON:
FADDEN, QUEENSLAND · LP

-Well, to the South Australian member who is presently Deputy Speaker I direct these comments. Very briefly, I wish to join with my fellow Queenslanders who have tonight presented a case in support of Queensland. I was very pleased to hear the honourable member for Capricornia (Dr Everingham) support some of the comments made by the honourable member for Lilley (Mr Kevin Cairns) because I believe that the contribution made by the honourable member for Lilley to this debate was a most constructive one. In defence of the honourable member for Kennedy (Mr Katter), I agree with the assessment by the honourable member for Capricornia that some of the comments made by the honourable member for Kennedy were correct. One must remember that the honourable member for Kennedy was sitting in this House peacefully and without a problem on his mind when he was stirred by a most surprising attack on his State, to which he responded. I am sure that the honourable member for Capricornia, who is a doctor, would concede the point that expenditure in fields such as health is not necessarily the yardstick of quality. I thank the exMinister, the honourable member for Capricornia, for indicating his agreement with my observations that expenditure on health in Queensland might be lower than the expenditure in other States because, for instance, Victoria imposes many more regulations on the way in which some of the institutions and hospitals are run. That could have the effect of reducing expenditure in Queensland.

If ever there were a crying example of the way in which industry treats Queensland badly it would be the closure only a few weeks ago of the Olympic tyre factory, when approximately 380 Queenslanders were cast on to the lists of the unemployed because the Olympic Tyre and Rubber Co Pty Ltd decided to withdraw all its manufacturing operations and to place them in Victoria. I am not indulging in an attack on Victoria. However, I say in conclusion that if companies based in the south wish to market their products in Queensland they have an obligation to consider employment opportunities in Queensland and also to establish factories to manufacture products for local sale. I am sick and tired, as are so many other Queenslanders, of so many companies adopting the attitude: Right, we will keep our companies and our manufacturing plants in the south and we will just ship the finished product to Queensland where there is a growing and thriving population which we can treat simply as a market’. That is all the effort they are prepared to make. In accordance with your desires, Mr Deputy Speaker, I will conclude my comments.

Question resolved in the affirmative.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Third Reading

Leave granted for third reading to be moved forthwith.

Debate (on motion by Mr Fife) read a third time.

page 3369

COUNCIL OF EUROPE

Mr CHARLES JONES:
NEWCASTLE, VICTORIA · ALP

-by leave-I present the report of the Australian delegation to the thirtieth ordinary session of the Parliamentary Assembly of the Council of Europe. Copies of the report are being reproduced and will be circulated to all honourable members. A limited number of copies will be placed in the Parliamentary Library and in the Table Office.

page 3369

BOUNTY (COMMERCIAL MOTOR VEHICLES) BILL 1978

Second Reading

Debate resumed from 15 November, on motion by Mr Fife-

That the Bill be now read a second time.

Mr BARRY JONES:
LALOR, VICTORIA · ALP

-The purpose of the Bounty (Commercial Motor Vehicles) Bill 1978 is to give effect to the Government’s decision to provide assistance to the assembly in Australia of heavier general purpose commercial motor vehicles, including buses. This follows report No. 154 of the Industries Assistance Commission dated 16 December 1977 on commercial motor vehicles, parts and accessories. That report was tabled in the Parliament on 15 May 1978. It was the result of the Government’s rejection of an earlier IAC recommendation to increase slightly import duties on heavier general purpose commercial vehicles. The Government considered that that measure would be insufficient to arrest the decline of the industry. Indeed, the Government returned the original reference to the IAC with the explicit suggestion that it study a package deal aimed at expanding production and employment in the Australian industry.

On 10 August 1978 the Government announced a package of measures designed to boost employment and production in heavier vehicle assembly. This package included the following: Firstly, duties of 22½ per cent on assembled heavier general purpose commercial vehicles and 25 per cent on prime movers for articulated dump trucks; secondly, duty free admission under by-law of completely knocked down- that is, CKD-vehicles and original equipment- that is, OE- components based soley on the extent of their assembly; and, thirdly, bountry assistance to local vehicle assemblers at the rate of 20 per cent of the instore cost to them of certain locally produced OE components. The new arrangements applied from 17 August 1978 and are to terminate on 31 December 1984.

This Bill proposes to implement part of this package, namely, that part relating to the bounty scheme. Two other aspects- one involving the setting of rates of duty on imported completely built up vehicles at 22 ‘A per cent and the other involving the duty free importation under by-law of imported OE components- were part of Customs Tariff Proposal No. 21 (1978) introduced into the House on 16 August and passed by this House only yesterday as part of the Customs Tariff Amendment Bill (No. 4) 1 978. 1 note that I still have 28 minutes of speaking time remaining, but the House will be gratified to know that I do not intend to use it all.

The Opposition does not oppose this Bill. Indeed, we recognise that this measure should have immediate beneficial effects for this industry and, I may say, for my own electorate as well, because Rockwell Standard of Australia Ltd which manufactures axles and which is located in Sunshine has been very much affected.

Mr Yates:

– Yes.

Mr BARRY JONES:
LALOR, VICTORIA · ALP

-I am sure that the honourable member for Holt is in a similar situation. The IAC estimated that such a measure would have the effect, firstly, of allowing vehicle assemblers to reduce their prices by an average of 1 1 per cent and, secondly, of increasing employment in assembly operations by the order of some 300 persons, plus a smaller increase in component production employment. I would think that a very high proportion of those 300 persons would be residents of my electorate. The Opposition is anxious to expedite the passing of this Bill. The Government’s action on CKD vehicles became effective immediately on the issue of by-law 2/35 in August which provided definitions for the degree of assembly to qualify for duty free entry of parts. As the result of delays involved in the introduction of this Bill, however, the component industry has been without protection since 10 August 1978. The delay has seen vehicle builders using local parts, which have not yet been priced with the benefit of a bounty, being forced to consider the use of imported equipment to enable them to compete with those companies using components which now are duty free. All this, of course, has been to the detriment of local component producers.

The co-operation of the Opposition in facilitating the passage of this Bill should not be seen as complete endorsement of the aims and the nature of the Bill. I shall now note several aspects of the Bill which worry us. The Government’s scheme conformed with the IAC recommendations, with one exception. Whereas the Commission had recommended that bounty assistance be available on all local components, the Government, in the light of the need to minimise expenditure commitments, decided ‘on less extensive, and less costly, assistance’. In particular, the Government’s scheme would provide bounty assistance to locally produced axles, gear boxes, propeller shafts, wheels, air brake equipment and suspension systems, if they were used as OE in the production of heavier general purpose commercial vehicle and buses. The reason given for that provision was that it would reduce the cost of the scheme.

However, neither the statement of the Minister for Business and Consumer Affairs (Mr Fife) announcing the decision, nor his second reading speech gives any indication of the total cost of the package. No indication was given in these public sources as to how much the cost of this restricted scheme would differ from the cost of the IAC’s broader scheme which was estimated to be about $4Sm to $50m; that is to say, about $ 18m in bounty assistance, and the remainder being customs revenue forgone. However, leaked reports- as we all know, that is the standard method of communication to this Parliament- indicated that the Cabinet submission of the Department of Industry and Commerce put the direct cost of the bounty scheme between $3m and $5m a year, making a total cost of about $30m when lost customs revenue is also included. When the 350 jobs which might be created are taken into consideration, the annual cost of the scheme would appear to be about $100,000 per additional job created. Despite the Government’s revision of the IAC proposal, the Government has failed to avoid a significant cost-per-job problem.

Another cause for concern is that the Government has published no reasons why it singled out the particular components which qualify for bounty assistance from the whole range of components to which the IAC broader scheme would have applied. I know that Ministers occasionally respond to pressure from anguished members. That has been known, as I think the honourable member for Holt (Mr Yates) would confirm. What it illustrates in a sense is that whilst I am gratified with the result for my electorate and no doubt the honourable member is gratified with the result for his electorate, it is another illustration of a made to measure tariff policy, something that is appropriate for one area but not appropriate for another. It is something which is difficult to explain as a piece of economic rationality for the whole nation.

Therefore, while serving an entirely deserving aim, the scheme that has been devised would appear to adopt clumsy, excessive measures to achieve this aim. This is the direct result of the Government’s doctrinaire rejection of any positive intervention and planning in industry, and the consequent over-reliance upon varying levels of tariff and bounty assistance as the principal means of achieving the objectives of its industry policy. In relying upon tariffs and bounties, the Government is abdicating its responsibilities for directly tackling the structural reorganisation of those industries which need it. Whilst the Opposition cannot oppose the Bill- a measure which is necessary to bale out industries, given the Government’s doctrinal blinkers- we must make it clear that we view these limited policies as being just another example of the Government’s myopic industry policy. We look forward to comprehensive policies instead of a whole series of hundreds of made to measure policies.

Mr CHAPMAN:
Kingston

-Before dealing specifically with the Bounty (Commercial Motor Vehicles) Bill 1978 and the Industries Assistance Commission report on which it is based, I wish to direct some general remarks to the concept of protection of local industry and comment on the various forms of protection, namely, tariffs, quotas and bounties. Protection in its various forms inevitably involves government intervention to distort the free market forces in an economy. This is basically contrary to the Liberal philosophy of free enterprise which involves competition in the market place. Therefore before a Liberal government intervenes to provide protection it must have strong justification. In pure economic terms protection is difficult to justify. Excessive protection in all forms, but particularly in the form of tariffs, is obviously detrimental to economic growth and wealth creation. It insulates an economy from change which is essential to real growth. Furthermore, it insulates particular industries which need to adapt to changing international conditions, to increase their productivity and to develop and apply new technology.

A certain element of protection may be justified on occasions on other than economic grounds, for example, social grounds. One example is that excessively large cities could and have developed through the location of industry on purely economic grounds. Society therefore suffers the attendant problems of mass societyalienation, crime, family breakdown and drug addiction. The maintenance of smaller cities through the protection of local industries to provide an employment base for a regional economy and prevent the drift to bigger centres may well be justified in such a situation. In particular, I use the city of Adelaide as such an example. The maintenance of a regional economy in South Australia through some protection may well be justified for social reasons. However, in such instances it is important to monitor the level and nature of assistance. The economic disadvantages of excessive protection would ultimately outweigh the social advantages. We must always remember that protection results in a diversion of resources away from their most productive and economic application.

Protection is a cost which has to be borne by the community in one form or another, so the alleged benefits should always be carefully analysed. One area where the cost is not readily recognised but is probably most severe is protection through tariffs. Only last year the DirectorGeneral of the Associated Chambers of Manufacturers of Australia, Mr W. Henderson, agreed with the IAC argument that the consumer and exporters ultimately pay for tariff protection. He also agreed with the lAC’s arithmetic that the cost of such tariff protection is about $4,300m annually. So a significant price is paid in Australia for tariff protection. Ultimately this protection is paid by the export industries. This is because the costs of production which are associated with tariff protection are passed down the Une until they can be passed no further. Of course, the buck stops with export industries which have to seU their products on world markets under free competition. They cannot set their own prices on those world markets. Hence it is finally the exporters who have to bear the full cost of tariff protection. This means in particular that Australia’s rural industries bear about half the tariff cost burden.

Tariffs are a cost which is borne by export earners. Whilst not readily identifiable, research can identify the particular costs to those export earning industries. The general disadvantage of tariffs is that their costs are borne by exporters; they shield an economy from the need to change and the need to develop in accordance with international economic developments and because they are applied to imports rather than to local producers, their application is general rather than specific. Therefore tariffs cannot provide the benefit of protecting a regional economy for social reasons, which I mentioned earlier may be a significant justification for protecting a particular industry.

The attempt is often made to justify tariffs on the basis that they maintain employment. This is a questionable assumption. Various IAC reports show that industries with the heaviest protection have had the greatest decline in employment. Because of the cost burden which tariffs put on the inputs to economic and efficient industries they restrict the growth of such industries and their capacities to employ. Whilst jobs may be destroyed by the abolition of tariff protection in one sector, replacement jobs may well be generated in another sector which is able to expand through increased demand for its products as a result of lower prices derived from lower cost inputs after the tariff burden has been lifted from its weary back. If that is not true in terms of transferring jobs directly, it is certainly true that lifting the tariff burden will result in increased utilisation of total resources.

In the Australian context it may well be that the most productive and efficient use of resources is in capital intensive spheres and areas of high technology industry rather than in areas of labour intensive industry.

It may be true that the actual number of, for example, 40 hour a week job units may decline. This should not cause unemployment. Rather, because of the resulting greater productivity and greater total production, it will result in the generation of greater real wealth within the community. Hence it will allow scope for reduced working hours, job sharing, permanent part time work and other benefits for which trade unions in Australia have been striving. Ultimately the abolition or reduction of such tariff protection will allow more people to hold jobs. It could afford this opportunity without a real reduction in wages because of increased productivity and the more efficient use of resources. In contrast, the present situation in which, because of excessive protection, many resources are not directed to their most efficient use, such benefits for employees can be achieved only with a severe cut in real wages. Excessive tariffs deny the opportunity for benefits to be derived from the most efficient and productive use of total resources, both labour and capital.

Protection by quotas has a similar impact to that of tariffs. Quotas also have the added disadvantage of allowing windfall gains to import licence holders. On the other hand, bounties although susceptible to the general dangers of excessive protection have specific advantages over tariffs and quotas. The first of these advantages is that the cost is more evenly borne throughout the community. The bounty is paid out of government revenue. It is raised from taxation and, therefore, is a charge on the whole community. In contrast, tariffs are borne by only one segment of the community, those who are producing for export.

The second advantage of bounties is that, because they are paid out of general revenue, they are a visible means of support whereas tariffs are a hidden form of support, not easily identifiable. The third advantage is that they can be made specific and can be applied to protect and support a regional economy which, for social reasons, it has been determined is worthy of protection. Nevertheless, it should be emphasised that even protection through bounties has a cost. That cost is not eliminated. However, if protection can be justified on social grounds clearly, on the basis of justice and equity, it should be provided through a bounty rather than a tariff or a quota.

I particularly commend the Government’s courage in providing assistance to the manufacturers of heavy commercial motor vehicles in the form of a bounty through this legislation. It is worth noting that bounties are not as politically attractive as tariffs. Tariffs are borne by a relatively small proportion of the voting public. Their costs are not as politically significant as those of bounties which are borne by the whole community through taxation.

Secondly, whereas tariffs raise revenue and provide a source of revenue for the Government, bounties are less politically popular because they provide a cost to revenue. But bounties are a more just and equitable means of providing protection. If it is deemed in Australia’s national interest that such protection should be afforded to a particular industry, on the basis of justice and equity, a bounty is the appropriate mechanism for providing such assistance. On the basis of political expediency, tariffs are often more popular with governments. Therefore, the Government should be commended on this occasion for taking the courageous decision to apply a bounty rather than a tariff mechanism.

The purpose of the Bill that we are debating is to provide assistance by way of a bounty to the assembly in Australia of general purpose motor vehicles, including buses, having a gross vehicle mass of 2.72 tonnes or more.

Mr BARRY JONES:
LALOR, VICTORIA · ALP

– I was wondering when you were going to finish the introduction.

Mr CHAPMAN:

– I hope that the honourable member for Lalor found some value in my introductory remarks. I am glad to see that he is nodding his accord in that regard. The scheme will operate from 17 August 1978 to 31 December 1984. The Bill reflects the general acceptance of the Government of the recommendations by the Industries Assistance Commission contained in report No. 1 69 of 1 5 May 1 978 on light commercial and four-wheel drive vehicles and heavier commercial vehicles and components. It is part of a total package of measures approved by the Government to encourage the assembly in Australia of commercial motor vehicles to maintain generally employment in the industry and, at the same time, to provide opportunities to reduce the impact of the prices of commercial motor vehicles on transport costs in Australia.

The bounty provides assistance at the rate of 20 per cent of the into-store value of axles, gear boxes, propeller shafts, air brake equipment and suspension systems, having an Australian content of not less than 65 per cent, which are purchased from suppliers not associated in business with the vehicle assembler for use as original equipment in the assembly of general purpose commercial motor vehicles, including buses, having a gross vehicle mass of over 2.72 tonnes.

Overall, Government policy is to encourage the assembly of heavier motor vehicles rather than their manufacture through reducing duties on fully imported heavier commercial motor vehicles to 22.5 per cent, reducing duty payable on imported original equipment components to nothing and providing bounty assistance on certain selected original equipment components provided for in this Bill. The bounty has been restricted to certain prescribed components. As I have said, it will exclude components manufactured in house- that is, by firms associated in business with assemblers. Components for heavier commercial vehicles are manufactured both by vehicle manufacturers and by assemblers in house and independent specialist component manufacturers. This bounty applies only to that latter category.

One area of concern to me in this Bill is the impact it could have had on W. H. Wylie & Co. Pty Ltd, a component manufacturer which operates on the fringe of the Kingston electorate. It is a wholly owned subsidiary of Chrysler Australia

Ltd. However, I am assured by the Minister for Business and Consumer Affairs (Mr Fife) that components produced by W. H. Wylie for sale to other assemblers will be eligible for the bounty under this legislation and that it is only the items used by Chrysler Australia which will not receive the bounty. I am glad for that assurance from the Minister.

This Bill reflects the recommendations of the IAC report on heavier commercial motor vehicles and components. The aim of the Government in sending that reference to the Commission was to provide for increased employment in this sector of the industry. However, the evidence which the IAC collected suggests that the scope for significantly increased employment is limited. To provide the best prospects of achieving this objective, the IAC concluded that the maximum spread of duty would be required- that is, a duty of 22.5 per cent on assembled vehicles and duty-free admission of components and CKD packs- combined with the payment of a bounty on all local components. It concluded that assistance in this form would allow vehicle assemblers to reduce their prices by an average of 1 1 per cent.

However, the IAC also suggested that the effective protection which would be afforded to the industry if these recommendations were adopted would be to more than double the effective assistance which was previously being accorded to the industry. In fact, it would afford protection of approximately three times the average level of assistance available to manufacturing industries generally. If continued indefinitely, this level of assistance would have undesirable resource allocation effects and would conflict also with the Government’s long term strategy for lower protection which was indicated in its White Paper on Manufacturing Industry.

So the Industries Assistance Commission recommended that this assistance be reviewed in five years’ time. I am glad that the Government has accepted that recommendation. The bounty payable expires on 31 December 1984. 1 assume that the Government has done this not only because of the recommendation of the Industries Assistance Commission but also because of recent statements by the Government, particularly the Minister for Industry and Commerce (Mr Lynch) that a new policy framework for the motor vehicle industry will be adopted around that time involving lower levels of protection. I welcome these announcements -

Mr Young:

– You are not going to take 20 minutes, are you?

Mr CHAPMAN:

– I hope the honourable member for Port Adelaide will listen. He might learn something. During my investigation of the motor vehicle industry overseas earlier this year, my own long held view of the need for greater rationalisation of the industry was confirmed. Certainly the emergence of the world car concept with international commonality of design and component complementarity is very clear.

Australia must share in this trend if its motor vehicle industry is to remain viable. I am glad to see that the Minister has adopted the same views since his recent overseas investigation. Recent Government decisions in respect of which I made strong representations will confirm Australia’s involvement in this trend. I refer in particular to the flexibility allowed Chrysler in meeting the 85 per cent local content requirement and also the removal of reversion control. Chrysler is the company which has initiated the trend towards rationalisation in the motor vehicle industry and it is now reaping the rewards through the sales success of the Sigma motor vehicle. We see that General Motors-Holden is now following suit in this regard with the release of the Commodore vehicle.

So the Government must avoid the temptation to provide excessive protection. Where protection is justified it is preferable to be provided in the form of bounties rather than quotas. Furthermore, the Government must allow Australia ‘s industries to rationalise in accord with international trends. Because this Bill meets all of these tests I support its passage through the House.

Friday, 24 November 1978

Mr SCHOLES:
Corio

-After listening to members opposite for four years talking about the evils of tariff cuts and the evils of cuts in quotas, it is interesting to find a member who has suddenly found a reason why he would advocate the abolition of tariffs, the abolition of quotas and the increases in income tax. The realities, of course, are that quotas are only a significant form of protection when on low volume items and can readily be borne by the revenue. Tariffs are a quite different form of protection and are, with quotas, the only form of protection available on large quantity items and likely mass import items from countries with different wage structures. The fact of the situation relative to the car industry and other industries is that, unlike what the honourable member for Kingston (Mr Chapman) has said, employees in that industry do not welcome unemployment and are not seeking unemployment as he would seem to suggest.

The second point is that the present plans which have allowed the car manufacturing firms in Australia to expand their operations to meet market demands were criticised by members on his side of the House at the time that they were adopted. The reason why the car firms were unable to meet that market situation at a much earlier stage was that the plans evolved in the 1960s locked the car firms into a 95 per cent manufacturers’ plan and gave them practically no room to manoeuvre; they were undercut by Japanese imports during that period. The honourable member should distribute his speech amongst all car workers in his electorate. I think it would be very welcome to his political opponents because it is a speech which indicates a complete lack of any rational knowledge of industry in Australia, the economic realities of protection or otherwise. One matter concerning the Bill which I would mention is that the exclusion of in-house components from bounty provisions can have the effect of moving existing manufactured components from an in-house situation to an external supplier. The competitive edge given to an external supplier with the loss of employment of people in one region can move that em.ployment to another contract supplier or even importers because of disadvantages which could be created by a discriminatory bounty where the relative costs and operations are similar. I draw that to the Minister’s attention because I think that part of the Bill could have the effect of disrupting existing employment with no advantage to the industry.

Mr CHAPMAN:
Kingston

– I seek leave to make a personal explanation.

Mr DEPUTY SPEAKER (Mr Giles:

-Does the honourable member claim to have been misrepresented?

Mr CHAPMAN:

– Yes. I was misrepresented in that the honourable member for Corio (Mr Scholes) claimed that I said that unemployment would be introduced through the reduction of tariffs. I did no such thing. In fact I pointed out very clearly that protection could be justified on social grounds -

Mr DEPUTY SPEAKER:

-The honourable member is now arguing his case and will resume his seat.

Mr SCHOLES (Corio)-I seek leave to make a personal explanation.

Mr DEPUTY SPEAKER:

– Does the honourable member claim to have been misrepresented?

Mr SCHOLES:

-Yes. The actual words the member used were ‘employment in the industry would be lower’.

Mr DEPUTY SPEAKER:

– This is not going to be a dog fight between two members at this time of night.

Question resolved in the affirmative.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr Fife) read a third time.

page 3375

TRADE UNION TRAINING AUTHORITY AMENDMENT BILL (No. 2) 1978

Second Reading

Debate resumed from 15 November (on motion by Mr Street):

That the Bill be now read a second time.

Mr YOUNG:
Port Adelaide

-I am a little alarmed that I have only half an hour to speak on this. The House would be aware that earlier in the year the Opposition was very much opposed to changes that were made to the original Bill that set up the Trade Union Training Authority in this country. We place great emphasis upon the work that it can do. Nevertheless, the changes have been made and we find that the Bill now before us makes the alterations that are necessary to see that the newly appointed director and the chairman from the various States or people who may be candidates or members of Parliament who play some role in the affairs of TUTA can be adequately catered for. We find no opposition to the essence of the Bill in that effect. A future Labor Government would reverse the decisions that have been made by this Government in altering the way in which the machinery of TUTA is now set up. The Opposition supports the Bill.

Question resolved in the affirmative.

Bill read a second time.

Third Reading

Leave granted for third reading to be moved forthwith.

Bill (on motion by Mr Street) read a third time.

page 3375

INTERNATIONAL LABOUR CONFERENCE

Mr STREET:
Minister for Employment and Industrial Relations · Corangamite · LP

– For the information of honourable members I present the texts of the following ILO instruments adopted by the 63rd Session of the International Labour Conference held in Geneva in June 1977:

Convention No. 148- Working Environment (Air Pollution, Noise and Vibration), 1977;

Recommendation No. 156- Working Environment (Air Pollution, Noise and Vibration), 1977;

Convention No. 149- Nursing Personnel, 1977;

Recommendation No. 157- Nursing Personnel, 1977

I seek leave to make a brief statement regarding these instruments.

Leave granted.

Mr STREET:
LP

– Honourable members will be interested to know that the four instruments were referred to the appropriate Commonwealth and State authorities for examination and comment. This examination suggests that whilst there is substantial compliance with the requirements of each instrument in most jurisdictions, in no jurisdiction is there full compliance with provisions of any of the instruments. Against this background, ratification of the two conventions and acceptance of the two recommendations would not appear to be possible at present. However, the joint Commonwealth/State Consultative Machinery on ILO Conventions will keep the two conventions under review, with a view to their possible ratification in the future.

Mr YOUNG:
Port Adelaide

-by leave-The Minister for Employment and Industrial Relations (Mr Street) has presented a most significant statement. At the behest of the Government I attended this year for the first time meetings of the International Labour Organisation. I was somewhat amazed by the machinery of the ILO and not altogether undaunted by the work done by the Australian representatives in making decisions and reaching agreement on resolutions and conventions, and the politics that are involved in the ILO itself. I place on record my thanks to the Government for continuing the practice that was established by the Labour Government of sending the shadow Minister responsible for labour to the International Labour Organisation meetings. I am not too sure whether the Government will continue that practice. Nevertheless I have had the benefit of attending a meeting, observing what happens and meeting with the people from the employers, the trade union movement and the Government. As a consequence the ILO has a much more important role in my thinking about industrial relations than beforehand.

I cannot place too much emphasis upon the role of the people who attend the meetings. I must say- I think the Minister for Employment and Industrial Relations (Mr Street) would agree with me on this-that the senior spokesman from the employers, who is in the House tonight, Mr Polites, and the senior spokesman for the union movement in Australia who is in this city tonight, Mr Hawke, have an influence way above what one would think Australia is entitled to at a forum such as the International Labour Organisation. I am not sure that they do not work out tactics before they go into some of these meetings. Nevertheless, whatever they do, it works very successfully. Those of us who have had the privilege of attending meetings as observers have found it gratifying to watch the operations of the ILO. It give us some insight into how international industrial relations are progressing and what is occurring as a result of the ILO ‘s practices.

After I left that meeting of the ILO I took the opportunity of visiting several countries, one of which was South Korea. That country comes in for a certain amount of criticism for the way in which it carries out its industrial practices. Certainly it receives a lot of criticism about the way in which people may be restricted in organising and perhaps presenting a case for better working conditions. The influence of the ILO now is even reaching that country, as I found just a few days after I left Geneva. I was told that for the first time a delegation from the ILO was allowed into South Korea to investigate, in this case, industrial accidents there. Undoubtedly most countries are very sensitive to observance by the ILO of the way in which they carry out industrial practices. I know that many people in Australia do not think that is very important. Because the time of travel is contracting so greatly it is becoming increasingly important that we should understand what is occurring in some of these countries. The Minister tonight in tabling this document said, against this background: . . Ratification of the two conventions and acceptance of the two recommendations would not appear to be possible at present

The ILO can pass a certain resolution. Politics are present at every session, committee and tripartite meeting of the ILO, so some things are not possible. Nevertheless, the ILO makes certain decisions which it wants to have accepted internationally. For Australia to say that it cannot accept that means that we are saying to the overwhelming majority of countries in the world: ‘If Australia in our circumstances cannot ratify a convention of the ILO there is certainly no chance that most other countries could do the same thing’.

Mr Street:

– One of the main problems is the federal structure.

Mr YOUNG:

– The Minister interjects, quite legitimately, to say that one of our main problems is the federal structure. Perhaps it means that we need a greater involvement of the States in the ILO at every level if there is no other way of overcoming the problem. I know the effect and influence just going to the ILO meeting had on me. Before I left Australia a number of people who had not attended an ILO meeting previously said to me: ‘This will be a great junket; you will have a great time going to Geneva; it is beautiful; the Labor Government established the principle and this Government is carrying it out; you do not have to do anything; you will have a good time’. I must say to all honourable members- I am not talking about myself in this instance because I had no specific responsiblity, apart from the observation of what was happening at the various committees and the General Assembly of the ILO- that those people who go to the ILO work very hard and conscientiously, far beyond my wildest dreams about what people would be doing at an international conference. They worked for long hours every day. They took the series of conferences and committee meetings extremely seriously.

The Australian representatives were doing their best to show that we have a sophistication of POlitiCS between employers, government and employees that can compete with the best that other groups or interests may be able to present at the ILO. I thought it was terribly important, but it is also important to note that the Minister made a statement tonight. I am not critical of the Minister. All I am saying is that there is a barrier in the federal system in Australia as a result of which we cannot ratify these conventions or adopt the recommendations. Perhaps that is another matter that should be looked at by the various meetings which the Minister calls between the State Ministers.

The newspapers today ran articles stating that the Commonwealth employees stand-down provisions legislation is coming in for a great deal of criticism by the committee that has been set up by the ILO. I do not think in any circumstance, in spite of the fact that Australia may be in a position to say that it has certain legal and constitutional barriers that prevents it from doing all the things that the ILO would like it to do, we want to be in the spotlight and the ILO saying that the Federal Government of Australia is introducing legislation which it finds contrary to the best interests of industrial relations. I do not know that those people who attend regularly the meetings of the ILO Executive, Mr Hawke or Mr Polites or government representatives, want to present those views. I think the Minister would have to look very seriously at the legislation that is being introduced into this Parliament- I do not forget also the inclusion of industrial relations provisions in the Trade Practices Act which may also become subject to ILO scrutiny- and I think the Minister should do more to explain to his colleagues in the Cabinet that we have not only a national responsibility but also in this case, when we are talking about the ILO, an international responsibility: I hope that the Government would have second thoughts about the legislation which it has previously introduced which has become the subject of criticism by an international organisation.

I think that the practice of sending people to ILO meetings is good. I am not too sure that in my own case a representative of the Opposition, or the same Opposition spokesman, should be sent to every meeting, but if the problem be that we should have more representatives from the States so that when the Minister comes back to Australia he then does not have to go through the problem or hurdles of explaining in detail word by word all the things that the ILO expects of Australia, as it does of most other countries around Australia. The Minister should discuss that with the States in the hope that we can overcome these problems so that when these recommendations are made, when these conventions are to be ratified, we can have a unified voice in Australia.

page 3377

DEFENCE SERVICE HOMES SCHEME

Ministerial Statement

Mr McLeay:
Minister for Construction and Minister Assisting the Minister for Defence · BOOTHBY, SOUTH AUSTRALIA · LP

– by leave- On 1 June 1978 the House of Representatives Standing Committee on Expenditure tabled the report on its inquiry into the Defence Service Homes Scheme. Honourable members will be aware that the Prime Minister (Mr Malcolm Fraser) has assured standing committees of the Parliament that there will be a ministerial statement, within six months of presentation of a standing committee report, on the action the Government proposes to take. I am now in a position to make that statement on behalf of the Government. The report has been carefully considered by the Government which has also had the benefit of the views of an interdepartmental committee. Before dealing with the individual recommendations I should like, on behalf of the Government, to thank the Standing Committee for conducting its examination of the Defence Service Homes Scheme. As the Committee itself said, its inquiry represents the first in-depth and searching examination since the Scheme was established 60 years ago.

Recommendation 1 of the Standing Committee called for the appointment of a qualified person from outside the Public Service to assess the relative effectiveness of programs designed to attract persons into and retain them in the Defence Force and for methods to be devised to enable continuing measurement or assessment of the effectiveness of these programs. This would no doubt facilitate decisions being taken as to whether Defence Service Homes loans should continue to be available to members of the peacetime Defence Force, as one segment of an overall conditions of service package. The Government accepts that the availability of Defence Service Homes loans is a valued condition of service and, as such, it could have a beneficial effect on attraction and retention rates in the armed Services. To measure its effectiveness by comparison with all other conditions of service is another matter. Past endeavours by psychology research units and operational analysis teams have been inconclusive in establishing a direct co-relation between conditions of service at large, or any one of them in particular, and reasons for discharge and-or resignation. It is worth nothing, however, that Service housing is a major source of dissatisfaction.

The recommendation of the Standing Committee not only envisages an initial assessment being made, but also the development of methods to enable continuing measurement and assessment In view of the far reaching and costly nature of such a proposal and the likelihood that the results will be inconclusive, the Government has decided not to take up this recommendation at the present time. In arriving at this conclusion the Government was conscious that the Committee of Reference for Defence Force Pay and the Defence Conditions of Service Committee machinery is available to monitor continually the overall package of pay and conditions with a view to ensuring their currency in present day conditions. In its second recommendation, the Standing Committee called for a restatement and explanation of the objectives of the Defence Service Homes Scheme. Although the purposes of all amendments to the legislation have been explained at the time of introduction, a statement of the kind recommended by the Standing Committee is long overdue.

The original War Service Homes Scheme was established shortly after the First World War to assist returned servicemen and their dependants towards home ownership. Since then the eligibility provisions of the Scheme have been expanded from time to time to include persons who served in the Second World War and later warlike operations in which Australian Forces were involved and, since 1973, certain members of the peacetime Defence Force. It is clear that there are now two broad categories of persons eligible for the benefits of the Defence Service Homes Scheme; namely, those who served, or volunteered to service, overseas in wartime and those who serve in peacetime. The Defence Service Homes Scheme exists as part of a wide range of benefits available to servicemen and exservicemen and its current objectives can be defined in their simplest form as: To provide a housing-specific benefit, firstly, to discharge the nation’s obligation to those who served, or volunteered to serve, overseas in wartime and, second, to attract and retain regular servicemen in the Defence Force in peacetime.

I emphasise that these objectives are subject to review and revision from time to time. The Standing Committee’s third recommendation proposed that the long tide of the Defence Service Homes Act should be amended. The Government is not prepared to adopt the long title suggested by the Committee but has agreed that this technical issue might be taken up with Parliamentary Counsel on the next occasion amending legislation is drafted.

Perhaps the most innovative and challenging proposal put forward in the 60 years existence of the scheme is the Committee’s fourth recommendation, namely, the amendment of the Defence Service Homes Act to allow eligible persons to choose to receive either a housing loan or a cash grant which would also be used to acquire a residential dwelling. The Government is attracted to the principle of offering a range of choices wherever possible so that persons concerned may make their own judgments as to which option is most suitable to their particular circumstances. However, it is not prepared, for a number of reasons, to adopt the recommendation put forward. It is difficult to equate the value to borrowers of the current loan in terms of a cash grant, and to see how relativity between loans and grants could be maintained under an optional grant scheme. Depending on the assumptions made, arguments may be advanced for grants as little as $3,000 and as much as $5,000 with similar cost to the Commonwealth per beneficiary on a discounted cash flow basis. On the other hand, the calculation of a grant of equivalent benefit to a person seeking to acquire a home indicates that an amount of the order of $7,000 would be required. A grant of this size is beyond the resources of the Government at the present time. Further, as a matter of principle, the Government cannot accept the proposal by the Standing Committee to hypothecate to grants under the Defence Service Homes Scheme any administrative savings that might be achieved in future by the introduction of a grant option. Since recommendations five and six are entirely dependent upon the acceptance of recommendation four, I do not propose to deal with them. I shall refer to recommendation seven when dealing with recommendation 13.

In recommendation eight the Standing Committee proposed a new method of identifying the extent of the concession involved in Defence Service Homes loans. The concession or interest subsidy is represented by the difference between the interest charged by the Defence Service Homes Corporation on its outstanding loans and the interest payable by the Corporation on the capital appropriations it has received over the years. Since 1975 when the concept of identifying a measure of subsidy was introduced, interest has been payable on the corpus of initial capital vested in the Corporation at the weighted average of long-term security rates over the previous 25 years. Capital drawings from Consolidated Revenue in each subsequent year attract interest at the rate applying to the longest securities of the most recent issue before the drawing. The rate of interest to be applied to the capital of the Corporation is a matter for determination by the Minister for Finance (Mr Robinson). The Government agrees with the basic approach of the Standing Committee in seeking a ‘rolling over’ of the corpus of initial capital but it believes that the Minister for Finance might well consider some modification of the Committee’s formula. The Government believes there is no parallel between the Corporation and the major home finance institutions which pay interest at current rates on all depositors ‘ balances or shareholders ‘ funds. On the other hand, it sees merit in arrangements whereby funds available to the Corporation through the repayment of loans would attract the same rate of interest as funds appropriated each year from Consolidated Revenue.

In its ninth recommendation, the Standing Committee dealt with staffing arrangements with the Defence Services Homes Corporation. As the reductions proposed by the Standing Committee have already been exceeded through the Corporation ‘s ongoing manpower review programs, no specific action by the Government is necessary. I think we should acknowledge the work of the Standing Committee in that respect. In recommendation 10 the Standing Committee made specific suggestions on improving performance and minimising costs in the use of computers. The Government is satisfied that the equipment purchased by the Corporation, and the uses to which it will be put, are consistent with both the Corporation’s requirements and the guidelines established by the Public Service Board. Accordingly, it does not propose to adopt the recommendation for a further study. However, the Government recognises that there is potential for cost savings if the Corporation’s computer facilities could be shared with other Departments. The Department of Veterans’ Affairs will be liaising with the Public Service Board in this regard.

In recommendation 11, the Standing Committee called for an examination of the costs involved in collecting instalments from borrowers, particularly the cost incurred in providing the faculty of payment at any post office. The Government endorses the principle of user payment, but difficulties would arise for many borrowers if the long standing arrangements for payments through post offices were withdrawn or altered. On balance, the Government has decided that it will continue for the time being to make available this facility to persons who have earned eligibility for a defence service homes loan. The publication of specific physical performance data related to the operational efficiency of the Defence Service Homes Corporation was the subject of the Standing Committee’s twelfth recommendation. The Government believes the details the Standing Committee has suggested for publication are in the category of information that is more suitable for internal management purposes than for publication. However, it agrees that the publication of some indicative measures of efficiency is desirable and the Corporation will publish information of this kind, in future annual reports.

The Standing Committee’s thirteenth recommendation called for legislative changes to permit persons who obtain loans under the Defence Service Homes Scheme to insure the properties with the insurer of their choice. This Government subscribes to the principle of freedom of choice and it has accordingly decided to adopt the Committee’s recommendation. Legislation will be introduced next year to amend the Defence Service Homes Act as necessary. I mention in the content of this decision and the Committee ‘s recommendation 7- that is the recommendation dealing with the distribution of a pamphlet on new options for eligible personsthat immediately after the passage of amending legislation all applicants for a loan will be notified of their right of choice of insurer and all current borrowers will be so informed in advance of the expiration of their existing insurance cover.

Mr Deputy Speaker, I take this opportunity to refer briefly to another matter which, whilst not directly related to the Committee’s report, does have a bearing on the Defence Service Homes Scheme. Honourable members will recall that one of the recommendations of the Committee of Inquiry into the Citizen Military Force was that the provisions of the Defence Service Homes Scheme be extended to include Citizen Force soldiers as an incentive to service. The Government has considered this proposal on the basis that any benefit of this type would have application to the Reserve elements of all three services. A considerable range of pay and related matters has already been implemented as a result of the Millar report and, in current circumstances, the Government has decided not to extend the Defence Service Homes Scheme to members of the Reserve forces. I present the following paper:

Defence Service Homes Scheme- Ministerial Statement, 23 November 1978

Motion (by Mr Ellicott) proposed:

That the House take note of the paper.

Mr UREN:
Reid

-The statement by the Minister for Construction (Mr McLeay) is very disappointing. It is disappointing not only to me and to the Opposition in general but also especially disappointing to the needy members of the defence forces. It is disappointing to the members of the House of Representatives Standing Committee on Expenditure whose recommendations have been largely rejected and diluted. I know how disappointing this statement must be for the honourable member for Lilley (Mr Kevin Cairns) and particularly the honourable member for Grayndler (Mr Stewart) who worked so hard on these recommendations.

I say firstly that the Minister’s statement shows up the Government’s hypocrisy and its crude lack of concern for people in need. It shows up particularly the lack of understanding of the Minister for Construction for the problems of needy members of the defence forces. The Government’s rejection of the substantive recommendations of the Committee needs to be seen in the broader context of the recent and severe downturn in the building industry generally. At a time when ample tradesmen and resources are available this Government is cutting back on defence service homes. The Government could make money available particularly to the needy.

I refer now to the activity within the Defence Service Homes Scheme. The number of homes provided by a Labor Government under the Scheme in 1974-75 was 9,380. The number provided by this Government in 1977-78 was only 6,1 15- a drop of 35 per cent. The decrease will be even greater this year than it was last year. In 1 974-75 the Labor Government spent $ 1 30m on the Defence Services Homes Scheme. In 1977-78 this Government spent only $90.3m and under this year’s Budget the Government expects to spend only $78.8m- a cut of $5 1.2m, or a reduction of 40 per cent in money terms, on the 1974-75 expenditure. If the expenditure were calculated on constant prices at the 1974-75 level the decrease would be much greater.

At the same time the cost of buying a block of land and a home has increased from $25,456 on average in 1974-75 to $37,900 in 1977-78-an increase of some 50 per cent in only four years. The amount of money available under this Scheme for each loan has not been increased from the $15,000 level set in 1974-75 under a Labor Government. At that time the Scheme provided only 60 per cent of the value of a block of land and a house; now it provides only 40 per cent. One can see that this Scheme is only for the wealthy. The average cost of a house is $37,000 so the $ 1 5,000 will not go very far.

Let me also remind the House of the regressive amendment that the Government has made to the legislation and the inadequate amount of money that is made available under this Scheme. As a result of the Government’s action the waiting period for loans for eligible applicants has increased from 1 1 months last year to 14 months this year. The period of service necessary to qualify for a loan also has been extended from three years to six years- the additional proviso is that the ordinary defence service personnel now must serve more than six years. After serving six years they have to sign on again in order to qualify for the loan. This means that the normal rank and file serviceman has to serve something like 9 years to qualify for the loan. On the other hand an officer in the Army has to serve only six years. That is blatant discrimination by this Government, but such discrimination is not unusual. This is a sectional government, a government of discrimination.

The amendment introduced by this Government to the Defence Service Homes Scheme also includes the penny-pinching imposition of a $75 loan application fee. Already the wealthly have better access to the scheme than do the financially needy.

Mr Cadman:

– Talk to the report.

Mr UREN:

– Honourable members who interject have to understand, and the honourble member for Lilley can set this out, that the Committee recommended against the $75 charge being imposed. The application charge will make the scheme more inequitable by discouraging the needy from making application. That discouragement comes on top of the inadequacy of the size of the loan-$ 1 5,000, with $ 12,000 at VA per cent interest and a further maximum of $3,000 at 7V4 per cent over 32 years- in relation to the price of the house in the western suburbs of Sydney, for example. The honourble member for Mitchell (Mr Cadman) should know that in his electorate it is not possible to get land and a dwelling for less than $35,000. 1 agree with the Committee, which was representative of both sides of the House. It took its job seriously and did a lot of hard work, and found that there should be no application fee for those who receive grants. More broadly, I accept that the defence service housing scheme is not working equitably or efficiently. On the point of efficiency, I agree with the Committee’s proposal for the appointment of a suitably qualified person from outside the Public Service to assess the relative effectiveness of the programs.

The Minister has even acknowledged that such an appointment could have a beneficial effect on attraction and retention rates in the armed services. He acknowledged that service housing is a major source of dissatisfaction, but he rejected the proposal because it would be too costly. The whole point has been missed by the Minister and by the Government. In order to make the scheme more effective an outside program evaluator is necessary, and the Committee set that out very clearly when it said:

Since significant sums of money are spent either directly or indirectly on the attraction and retention objectives it is very necessary to assess the relative effectiveness of the various programs in use.

That is not the only purpose of the evaluation. I want to stress the need to ensure that the needy and not the wealthy get help from such a scheme. I have asked before in this House whether privates and colonels should be entitled to the same benefits. I ask now whether there should be some criteria of need for assessing priorities for those on the waiting list. Here again, I do not mean giving preference to wartime service personnel over peacetime service personnel. I am talking about those people most in need. That matter was dealt with in the Committee’s report. I am disappointed too that the Government persists with the demarcation between peacetime and wartime service. I know that the Minister for Veterans ‘ Affairs (Mr Adermann) has suspended that proposal because of lack of funds, but again, it is in the Act and that is one of the discriminations. The work carried out by the Committee, and it has presented a very detailed report, should have been given more understanding by the Minister and by the Government, but they have not done that. They have not shown much understanding.

I will not say any more because I know the time is short. Two members of the Committee want to express some criticisms, I am sure, of the Government for at least not giving their recommendations more serious consideration. Therefore I can only condemn the Government generally for its whole approach to defence service homes. These homes and housing in general have received a very low priority from this Government. The Government knows that this is a time when resources of both men and material are available. It could provide money to make defence service home loans more readily available and to do away with the 14-month waiting period. If it does not do away with the 14-month waiting period, at least it should start to deal with those on the waiting list on the basis of need and not allow the colonels and those on high incomes to use this scheme to buy houses worth $80,000, $90,000 and even $100,000. Those people should not be allowed on the waiting list or at least they should be put well down the list. These loans should be dealt with more on the basis of need.

Mr KEVIN CAIRNS:
Lilley

-I will respond very quickly on behalf of the House of Representatives Standing Committee on Expenditure to the response by the Government through the Minister for Construction (Mr McLeay). I appreciate that the Minister was acting for the Minister for Veterans’ Affairs (Mr Adermann). It is in the Department of Veterans’ Affairs that the Defence Service Homes Act is presently administered. I will go through the points that have been made as quickly as I can. I believe that the response has been grudging and rather bare and very unfair. I will deal with the recommendations seriatim.

The first recommendation referred to the Government appointing a suitably qualified person to assess the relative effectiveness of programs, et cetera. Very little comment is deserved on this matter at present. In passing, one would say that if one of the objectives of the Defence Service Homes Scheme is to attract and retain regular servicemen in the Defence Force, and if there is really no method of assessing the effectiveness of this and other programs which are designed to do a similar job, then one might as well pull policies and money values attached to these policies out of a hat and treat them appropriately.

The second recommendation was to explain the objectives of the Defence Service Homes Scheme. I am pleased that the Government has defined the objectives of the scheme. We would like to study the response because it does not make it clear whether the objectives have also been explained as asked for in the recommendation.

The third recommendation referred to the title of the Defence Service Homes Scheme. It is in this way that I think it may be demonstrated that the response of the Department which the Minister assisting the Minister for Defence (Mr McLeay), acting for the Minister for Veterans’ Affairs, has read, has been mean. That is the only way to put it. This recommendation was made because the Committee felt that the long title of the Defence Service Homes Act 1918-‘. . . to make provision for homes for Australian Soldiers and Female Dependants of Australian Soldiers’- was no longer appropriate. The third recommendation made an attempt to make the long title more appropriate, although the Committee would never claim to have any expertise in legal drafting. It seems quite mean, therefore, for the Government to respond by saying it is not prepared to adopt the long title suggested by the Committee, but has agreed to leave this technical issue, as it defines it, in the hands of the Parliamentary Counsel. That is a grudging concent if ever one was to see one.

Recommendation 4, the cash grant alternative, which lay at the heart of our proposals, was that beneficiaries be given an option of a subsidised housing loan or a cash grant to be used to acquire a residence, this recommendation is central to the Committee’s report. Indeed, it is referred to as the most innovative and challenging proposal put forward in the 60 years of the scheme’s existence. Although some broad judgments are required, the Committee provided arguments which suggested that a grant of about $5,000 would not increase the cost of the scheme to taxpayers, and yet would prove attractive to many Defence Service Homes Scheme beneficiaries, particularly those who now must take out bridging loans or who might be unable to take advantage of the defence service home loan because of a deposit gap.

The Government simply asserts that a grant of $7,000 would be needed to make our proposal viable. We never mentioned $7,000. 1 could not get the calculation up to $7,000, no matter what interest rate might be used. I ask: Why? By what process of reasoning is a grant of this order necessary? It would seem that this figure has been based on a totally misleading distinction between the way benefits to recipients and costs to taxpayers are calculated. It has also been based on the same inaccurate line of reasoning put forward by the Department of Veterans’ Affairs, which seeks to put the grant proposal in its worst light. For example, the argument ignores the savings that eligible persons would make from having to pay bridging finance of about $1,500 and, in some cases, $3,000 as reported in the sixty-first annual report of the National Executive of the Returned Services League of Australia.

The Committee’s further argument that some of the administrative savings made available under a cash grant scheme could be given to recipients has been rejected by the Government ‘as a matter of principle’. We ask: What principle? How can such a matter be rejected when the whole basis of the Committee’s argument is that in the short term a cash grant should not cost more, whilst in the long term it could lead to significant savings in administrative costs which could be shared between the recipient and the taxpayers? If a loan is given somebody has to be kept in employment for 30-odd years to receive the monthly payments. Under the system we suggested, no one has to be kept in employment for 30-odd years or, in some cases, 40 years to receive the monthly payments so surely that would represent an administrative saving, on top of other savings. Our suggestion has been totally ignored.

The honourable member for Grayndler (Mr Stewart) was a highly valued and honoured member of the Committee. The honourable member for Parramatta (Mr John Brown), the honourable member for Berowra (Dr Edwards) and the honourable member for Henty (Mr Aldred) put a lot of work into developing the idea of the cash grants. We examined very carefully departmental arguments. Our consideration of the case for the cash grant was presented in detail in about 30 paragraphs of the report. I must express disappointment that these arguments have been treated in a cavalier fashion.

Mr Cadman:

– Tell us the good news.

Mr KEVIN CAIRNS:

– The very good news for the Government is that it would be of benefit to the Government to adopt some of the Committee’s recommendations. It would gain a lot of credit throughout the country. A number of other recommendations followed upon the cash grant proposition. They did not find favour. The other recommendations fall according to the response we have received so far from the Department of Veterans’ Affairs.

Recommendation 8 concerns the interest rate payable by the Defence Service Homes Scheme on the accumulated capital. We suggested that it should be shown as being paid at the long term bond rate. I do not quite understand the nature of the response which has been read in respect of this matter. It is certainly not very clear at all. It might be that a variation of the decision on that matter is still possible. Recommendation 9 referred to the number of staff which were employed in the processing of new applications in a number of States. We stated that the number of staff could be reduced in Victoria, South Australia and Tasmania by eight, four and two staff members respectively.

I say that the Government’s response to this recommendation frankly is unsatisfactory. It simply states that the Defence Service Homes Corporation’s on-going manpower review programs have led to greater staff reductions than those recommended by the Committee. It does not comment on the relevance of the Committee ‘s technique in reaching its conclusion, nor does it give figures to show the extent to which the reductions we proposed have been exceeded, nor does it indicate when those reductions came about, whether before or after this report became public. It became public at the end of the autumn session of Parliament in 1978. That timing is of importance. I believe that it might show that the Department of Veterans’ Affairs has been far too grudging in its response to the initiative which the Committee has shown.

Recommendation 10 is a technical recommendation with respect to the use of magnetic tapes. I will read the response to that recommendation. Once again, the response is quite unsatisfactory. It states:

The Government is satisfied that the equipment purchased by the Corporation, and the uses to which it will be put, are consistent with both the Corporation’s requirements and the guidelines established by the Public Service Board.

What does that mean? I do not know what is means. Does the Government agree that, as is stated in the report at paragraph 136, the feasibility study which led to the purchase of equipment had limited objectives in that it merely viewed the computer as an alternative to the accounting operations then in use? What about the recommendation concerning the cost effectiveness study to determine whether magnetic tape units should be used as an alternative to microfiche in registry work? The Government just has not responded to this recommendation.

I refer to recommendation 1 1. The honourable member for Grayndler had a great deal to do with this recommendation. One can do so irrespective of the side of the House on which one sits. This recommendation concerned an alternative method of payment. I believe that the Government again has misunderstood the whole purpose of the section which dealt with charges of the Australian Postal Commission. In a sense, paragraphs 139 to 148 state that there is a prima facie case for alternative arrangements, or for a combination of alternative arrangements, to be examined because of the potential for significant cost savings. Honourable members should realise that the Postal Commission charges 2.31 per cent for processing each monthly repayment of each borrower. For example, for a person whose monthly repayments are $73.82- that is the repayment for the present $15,000 loan over 32 years- the Australian Postal Commission’s commission is $1.71 a month. This appeared to us to be an inordinately high figure. We suggested the examination of a variety of alternatives which could have resulted in savings of about $lm. What is the Government’s response? It says that ‘difficulties would arise for many borrowers if the long standing arrangements through post offices were withdrawn or altered’. What are the difficulties? Tell us the difficulties. This statement itself is misleading because one of the alternatives related to new borrowers and not existing borrowers. Therefore it appears that the Government’s response is misleading to say the least.

Then, of course, there is the intriguing conclusion which says that on balance, et cetera, things will be continued for the time being. I regard this as a typical piece of Public Service language which resides in people who are unable to come to any conclusion. We had offers from national organisations. The honourable member for Grayndler would agree that each repayment could cost 40c or 60c instead of $ 1 .7 1 .

Mr Stewart:

– Sixty cents.

Mr KEVIN CAIRNS:

-There is a very significant difference between 60c a repayment and $1.71 a repayment per month for 30 years. Yet this suggestion seems to have been rejected out of hand. I do not know why this was done. The Minister for Construction, who is at the table, is a thoroughly decent Minister. I know that he has read the response of the Department of Veteran’s Affairs very accurately. But why should that recommendation be rejected?

I would like to make two other points very quickly. I will then sit down. We suggested that the annual reports of the Defence Service Homes Corporation include information on unit costs of processing new applications. The response to that is rather up in the air, but there seems to have been a win in that appropriate changes have been made to the relevant legislation to allow persons to insure their properties with the company of their choice. The members of the Committee- the honourable members for Grayndler, Parramatta, Henty, Berowra and me- are very disappointed with this response. The Committee will, of course, consider the response in detail and no doubt at a later date it will give a fuller reply in respect of its attitude to the response. We hope that the very good sense of what we propose will be seen for what it isthat is, very valuable to the Government- when this matter is debated after that reply is examined. We believe that the major parts of our recommendations, if adopted, would be very valuable to those people who are eligible for a defence service homes loan.

Mr SCHOLES:
Corio

-I will delay the House for only about one minute. The honourable member for Grayndler (Mr Stewart) wants to respond on behalf of the Opposition members of the House of Representatives Standing Committee on Expenditure. The matters I want to raise are directly related, although not directly arising out of, to the ministerial statement of the Minister for Construction and Minister Assisting the Minister for Defence (Mr

McLeay). The first matter I raise is the failure of the Minister to mention- I do not know whether the report mentions it- the continuing discrimination against Australian Citizen Military Forces servicemen who served in theatres of war within Australia in the Second World War and who are excluded from benefits under this Act. Persons who served outside Australia and who did not necessarily face the same risks have Defence Service loans available to them.

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

– Prescribed areas, theatres of war.

Mr SCHOLES:

– Well, prescribed areas, but those people are still excluded. Persons who in fact were under enemy attack on the mainland of Australia are excluded from benefits under this Act. They are not excluded from benefits under other Acts which cover ex-servicemen. I make that point briefly. I hope that the Minister will take up the matter. I have already had correspondence about it either with him or with the Minister for Veterans’ Affairs (Mr Adermann).

The other matter I raise is equally related to the conditions of service of servicemen, and I think it relates directly to the responsibilities of the Minister. I draw his attention to the almost total lack of adequate maintenance of defence homes as opposed to Defence Service homes. I draw specific attention to the defence homes in Darwin which were damaged during cyclone Tracy. Of those damaged two-thirds still have not been repaired and Darwin is presently in the fourth wet season since the cyclone struck. I draw the Minister’s attention to the fact that it is an unsatisfactory situation that defence personnel in Darwin are required to live in houses which, on the basis of the standards laid down for civilian housing in that area, are sub-standard. I think it is time that permanent repairs were undertaken to those houses. Fairly constantly I receive complaints about the almost total lack of maintenance to defence houses or the proper upkeep of those houses. Thus they have lost value as an asset to the Government because of neglect in almost every part of Australia. They are the remarks I wanted to make. I hope that the Minister takes them into account.

Mr STEWART:
Grayndler

– Due to the lateness of the hour I will not delay the House for very long. I support the remarks made by the honourable member for Lilley (Mr Kevin Cairns) who is the Chairman of the House of Representatives Standing Committee on Expenditure. In its inquiry the Committee thoroughly examined the Defence Service Homes Scheme. It was the first time that the

Scheme had been looked at thoroughly since its inception. The Committee considered very thoroughly on the 13 recommendations that it subsequently made. Today we find that the Minister Assisting the Minister for Defence (Mr McLeay) has grudgingly accepted one of the 13 recommendations that were brought down. He admitted that the main recommendation concerning the optional grant was innovative and a major recommendation made by the Committee and that it represented a major alteration to the Defence Service Homes Scheme. That recommendation has just been thrown out the window, despite the fact that the Committee argued it quite thoroughly in its report.

The other matter of some significance is the amount charged by the Australian Postal Commission to collect moneys on behalf of the Defence Service Homes Corporation. The charge is $1.71 per month on the average loan of $15,000 on which the monthly payments are $73. Even under the new health insurance scheme the private medical benefits funds which will pay out moneys on behalf of the Government will be allowed, I think, only $1.54 for each transaction. When we consider the amount that the Aus.tralian Postal Commission Will be getting from the Government just for collecting these moneys, there is reason to wonder whether the Committee’s report was considered thoroughly by the Government.

Mr Kevin Cairns:

– It is the first time that has been exposed.

Mr STEWART:

– It certainly is. It is the first time that that excessive amount has been brought to the light of day, as the honourable member for Lilley says. The only other point that I make is that there is no doubt in my mind- as the Chairman of the Committee, the honourable member for Lilley said- that the Committee will examine thoroughly the Minister’s response, although there is not a great deal to examine. Much of the eight pages is gobbledegook. There are no definite statements explaining why the recommendations of the Committee were rejected. In order to allow honourable members to get home to bed at this hour of 1.15 in the morning I will reserve my further comments for the Committee’s full and considered response to the statement brought down by the Minister earner today.

Mr McLeay:
Minister Assisting the Minister for Defence · BOOTHBY, SOUTH AUSTRALIA · LP

– I realise that it is extremely late, a quarter past one in the morning. Nobody likes his bed more than I do, except perhaps the Deputy Speaker and one or two others, but it would be entirely inappropriate if I did not respond in at least reasonable detailwithout spending a lot of time in doing so- to the matters that have been raised in this debate by honourable members, whom I thank for their participation.

Contrary to what has been said by almost every speaker, the Government did examine this report very carefully. The honourable member for Reid (Mr Uren) expressed his dissatisfaction but what he was really expressing was disappointment that all of the recommendations were not adopted. There is a difference. In fact, contrary to what has been said by almost every speaker, if some of the recommendations that we have rejected were adopted they would create great and justifiable dissatisfaction amongst both servicemen and exservicemen. That ought to be acknowledged. I hope that I shall be excused for leaving the remarks of the Chairman and Deputy Chairman until last, because they I think express the same views, and I need to attempt to explain what we have done. What the honourable member for Reid said had very little to do with the statement Unfortunately, he is not now in the chamber, but no doubt he will read my remarks.

Mr Morris:

– There are only eight people in the chamber.

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

– I do not criticise or blame him. If I were in his position I would be home too. He said that $15,000 did not go far enough. We agree, but it is a queston of what funds are available. I would remind the House that when the Labor Party was in government it extended eligibility for participation in the war service homes scheme to all who served, as an inducement for people to enlist. Thus, hundreds and hundreds more people became eligible for a loan. The loan was no longer based on war service alone. Participation was offered as an inducement to people to enlist Thus, the money available has not gone as far as it would otherwise have done. It should not be suggested that- setting aside all the obvious arguments about inflation- it is entirely the fault of this Government that the funds are not there. That is all that I would like to say about the remarks of the honourable member for Reid.

The honourable member for Corio (Mr Scholes) raised one or two valid points which I will undertake to refer to the Minister for Veterans’ Affairs (Mr Adermann). Much of what he had to say concerned defence forces homeshomes for people in the services- which has nothing to do with the present statement. I think that the honourable member acknowledged that fact. We would admit that the quality of some of the homes that are owned by some of the defence forces is not as high as it ought to be. A significant effort has been made to update some of those homes. In fact, in recent times we have been able to return to the States hundreds of apartments and dwellings that we would all regard as not being satisfactory for service people or other people, if it comes to that. That is really quite irrelevant to a consideration of this statement.

I would like now to discuss, in justification of what the Government has done, one or two of the remarks that were made by the Chairman and Deputy Chairman of the Committee. The first question concerned the recommendation of the Committee that some person should be engaged from outside the Public Service to tell us how we should improve recruitment procedures. The wording used was:

To assess the relative effectiveness of programs designed to attract persons into, and retain them in, the services.

The Government rejected it. In the first place, there is a continuing committee within the Department of Defence which is called the Conditions of Service Committee. It does not just sit one day and go home the next. It examines the conditions of service on a daily basis.

Mr Stewart:

– It doesn’t know what results it is getting. Its members could not answer the questions from members of our Committee.

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

-This Committee sits all the time. Conditions of service are being changed all the time. So this is an ongoing process. Furthermore, in recent times- in fact when the Labor Party was in Government- a committee of inquiry- the Kerr/Woodward Committee- was appointed to do exactly the job that was suggested by the Expenditure Committee. The work of that Committee cost several hundred thousands of dollars. Some of its suggestions that were implemented have created more problems than they have solved. The Government believes as I believe that an inquiry of the sort that has been recommended by the Expenditure Committee would be equally inconclusive. That is the straight answer to that direct recommendation and the suggestions put forward by the Committee’s Chairman and Deputy Chairman. Cost is quite significant.

The second recommendation was adopted in toto. More than one recommendation was adopted, and that was one of the criticisms of the honourable member for Grayndler (Mr Stewart). The third recommendation was the subject of some criticism by the Chairman. I accept the criticism because I can understand that for a committee that has put as much work into its report as this Committee has put there is a natural disappointment when all of its recommendations are not adopted. There are good reasons for those recommendations not being adopted.

Mr Kevin Cairns:

– The attitude to that was very grudging.

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

-I acknowledge that perhaps the english that was used in the statement was not as expansive as it could have been. I am attempting now to put that right. In dealing with the third recommendation, the long title of the Defence Service Homes Act, the Chairman of the Committee, the honourable member for Lilley (Mr Kevin Cairns), said- I think I quote him correctly; he said it in a somewhat grudging way, if I might say so- that this was to be left to the Parliamentary Counsel.

Mr Kevin Cairns:

– I thought it was very gentle.

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

-I thought that it was a very good and appropriate speech but the fact is that it is being left to the Minister for Veterans’ Affairs and he will consult with the Parliamentary Counsel. In due course an amendment will be made. I think that really that is a victory for the Committee and not a rejection, as the honourable member for Lilley suggested.

Let me illustrate the sort of problem that we came across in the recommendation of the Committee that the Act should be changed to read that the Act should assist eligible persons to acquire a residential dwelling. That is the ‘short’ long title that was suggested by the Committee. Even that is deficient in a sense if one takes it in semantic terms. I would like to call a ‘residential dwelling’ a ‘home’. The matter has been looked at very carefully. I have no doubt that in due course that long title will be amended. The Committee really won on that matter too.

Mr Cadman:

– They are not really rushing things, are they?

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

– The worst thing that one can do is to rush things and make mistakes. It does not matter a tinker’s benediction to exservicemen whether it has a long title or a short title. Really, in the final washup, that does not matter at all.

Mr Neil:

– Aren’t all dwellings residential?

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

-That is what I would have thought. Why not just call them ‘homes’? Why call them ‘residential dwellings’? I think I am getting some support. The fourth recommendation- I think the Government’s failure to accept it offended the Committee mostsuggested that there should be a cash grant in lieu of the existing mortgage arrangement or the existing loan. I can assure the House that there is a general apprehension amongst servicemen that that recommendation should ever be adopted.

Mr Kevin Cairns:

– As an alternative?

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

– That is another matter. As an option, that is not such a problem for servicemen. It would not be a goer at this stage because, as it is now, people have to wait for a loan and for a grant. What servicemen want- this is one of the odd occasions when I agree with the honourable member for Reid- is not a cash grant and not even a fast loan but, rather, a bigger loan. I think that probably most honourable members would agree with that. I believe that servicemen would prefer to obtain a higher loan even if they have to pay a slightly higher interest rate. That is what servicemen want.

Mr Kevin Cairns:

– But this does not include that.

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

– I know it does not. I am saying what servicemen want. They do not want a cash grant and they especially do not want a low cash grant. The Government is not in a position to make a grant available which would be sufficient to bridge the deposit gap. So far as the optional and non-optional aspects are concerned, there would be no savings, certainly in the short term, in respect of this arrangement because they would still have to be parallel.

Mr Neil:

– Why do servicemen complain that it is an option only?

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

-The honourable gentleman will have to put that question in a way that I can understand. I do not hear servicemen complaining about this. What they complain about is that they cannot get the loan, that they have to wait and that it is not big enough. Consequently there are not as many servicemen, certainly not those in the lower and middle income groups, who can afford to buy a home because the grant is not big enough. That is what servicemen care about. They do not want the cash grant because if some future government increased the loan those who have taken the cash grant today would then miss out on getting a bigger cash grant.

Mr Neil:

– It might have helped with the deposit gap.

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

– It would help with the deposit gap if it was a decent cash grant.

Mr Morris:

- Mr Deputy Speaker, I raise a point of order. Can some assistance be provided to the Minister to enable him to make his contribution without constant interjections from Government supporters. The time is late and the Minister is tired.

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

- Mr Deputy Speaker, I acknowledge that it is as much -

Mr DEPUTY SPEAKER (Mr Jarman:
DEAKIN, VICTORIA

– Order! The Minister will resume his seat. I do not want to inhibit crossfire or interjections across the chamber which may help to elucidate matters but I suggest to certain members on my right that they allow the Minister to continue.

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

– Thank you, Mr Deputy Speaker. I acknowledge that it is as much my fault -

Mr DEPUTY SPEAKER:

-The Minister does not need to respond to my ruling.

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

– The hour is late. It is a great shame that the report had to be brought in at this time- I believe that it is one of the most important reports we have ever had- but we are obliged to bring it in within six months of the tabling of the original report. That means that it has to be in either today or tomorrow. Perhaps it should have been in yesterday. Yesterday is finished and we are now well into tomorrow, and if I continue like this we will be here until Saturday. However I think that a proper response is required. In spite of what the honourable member for Grayndler says, recommendation No. 7 was adopted so there is no point wasting any time on that. Recommendation No. 8 was adopted philosophically.

Mr Stewart:

– You only admitted that one was adopted. You grudgingly accepted two or three of the others.

Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

-Mr Deputy Speaker has stated that I cannot acknowledge these interjections so I will not. The position in regard to turnover of capital has been adopted as a fundamental view. We go along with that. The position is that the capital of defence service homes is the aggregation of the advances from the Budget over a period of 25 years. Those advances were calculated at the then equivalent of the long term bond rate which was much lower than it is today. The Government has decided to apply that philosophy to last year’s principal so that over the next 10 or 1 5 years the whole of the principal will be rolled over- that is the expression- in such a way that will achieve the objectives of the Committee. So, to that extent we have agreed with the Committee’s recommendations. Recommendation No. 8 has been adopted. I do not know when it was adopted but surely we can be given credit for having agreed to it. The first part of Recommendation No. 10 has been adopted. When there is computer space available it will be offered to other departments. The computer system is not yet completely installed.

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

Mr Morris:

– I take a point of order. I draw your attention, Mr Deputy Speaker, to the Minister’s remark and ask for your ruling. He said that this report had to be dealt with within six months of being tabled. The report of the Standing Committee on Road Safety on motor cycle and bicycle safety was tabled on 1 June. The six months will lapse before the House resumes next year. I think it is unfair that the Minister has had to table this report at this hour particularly because of the importance of the report. The recommendations of the Road Safety Committee should have been responded to by the Minister for Transport.

Mr DEPUTY SPEAKER:

-The Chair has no control over that matter.

Question resolved in the affirmative.

House adjourned at 1.31 a.m. (Friday)

page 3387

NOTICES

The following notices were given:

Mr Sinclair to move That the orders of the day, government business, for the resumption of the debate on the motions to take note of the following papers, be discharged:

Science and the Environment- Senate Standing Committee- Report on annual reports- Government response- Ministerial statement.

Foreign Investment in Australia- Paper.

Legal aid- Revised guidelines and solicitors’ feesMinisterial statement and papers.

United Nations- General Assembly- Special session on disarmament- Report of Australian Delegation- Paper.

Nuclear energy agreements- Papers and ministerial statement.

Defence force personnel entitlements- Ministerial statement.

Immigration policies and Australia’s populationMinisterial statement and papers.

Population and Australia- Paper

Uranium export policy- Ministerial statement.

Welfare and health- Paper.

Migrant services and programs- Paper.

Australia-Japan relations- Paper.

Consular services for Australians overseas- Ministerial statement.

Borroloola land claim- Paper.

Parliamentary committee reports- Ministerial statement.

Aboriginal communities in the Northern TerritoryImpact of mining royalties- Paper.

Health care costs- Ministerial statement.

Australia-Papua New Guinea maritime boundaries and other matters relating to Torres Strait-Ministerial statement and papers.

Australia-Papua New Guinea maritime boundaries and proposed Torres Strait protected zone- Ministerial statement.

Foreign policy- Ministerial statement.

Croatian Embassy’- Ministerial statement.

Trade relations with the European Economic Community- Ministerial statement.

Tactical fighter force project- Ministerial statement.

Police resources in the Commonwealth area- Report.

Security and counter-terrorism- Ministerial statement.

**Mr McLeay** to move That, in accordance with the provisions of the *Public Works Committee Act* 1969, it is expedient to carry out the following proposed work which was referred to the Parliamentary Standing Committee on Public Works and on which the committee has duly reported to Parliament: Construction of stage 1 development, Bonegilla army site, Victoria. **Mr Hayden** to move That the following new standing order be adopted: 15 1a. The time limit for an answer to a question with out notice shall be 3 minutes but may, by leave, be extended'. **Mr Hurford** to move That this House censures the Minister for Primary Industry because, among other reasons, he has failed- {: type="1" start="1"} 0. 1 ) to provide the Parliament with a satisfactory expla nation in rebuttal of serious public charges made against him in relation to his financial affairs, and 1. to justify, in particular, taxation claims for misappro priations made by companies with which he is associated amounting to over one quarter of a million dollars which deductions cost the public purse over $115,000. (Notice subsequently withdrawn) {: .page-start } page 3389 {:#debate-60} ### ANSWERS TO QUESTIONS UPON NOTICE The following answers to questions upon notice were circulated: {:#subdebate-60-0} #### Department of Productivity: Contracts (Question No. 1794) {: #subdebate-60-0-s0 .speaker-CH4} ##### Mr Holding:
MELBOURNE PORTS, VICTORIA asked the Minister for Productivity, upon notice, on 22 August 1978: {: type="1" start="1"} 0. 1 ) How many contracts entered into by Departments and Statutory Corporations under his control for the purchase of equipment, contained clauses specifying an offset arrangement with the vendor for the purchase of Australian manufactured goods, components and/or technology during the last 10 years. 1. What were those contracts. 2. What was the sum involved in each offset clause and what were the terms of its discharge. 3. What is the extent to which the terms of these clauses have been implemented specifying in each case the monetary value of the implementation. 4. What sum is currently available under these clauses for the purchase of relevant Australian manufactured goods, components and/or technology. {: #subdebate-60-0-s1 .speaker-6I4} ##### Mr Macphee:
Minister for Productivity · BALACLAVA, VICTORIA · LP -- The answer to the honourable member's question is as follows: >For the purpose of answering the series of questions 1773-1799 as Minister responsible for the Department administering and co-ordinating the Offset Program I have provided information which was sought from the other Ministers to whom the question was directed with the exception of the Minister for Defence. > >My colleague, the Minister for Defence, will provide a detailed reply to question number 1773 regarding offset obligations required and discharged for major defence purchases. > >I will therefore confine my answer to the contracts entered into by other Departments and associated statutory bodies and the offsets generated in this regard up to 30 September 1978. > >The Australian Offsets Program has its origin in a decision by the Australian Government in 1970 to require that offset orders be placed in Australia against major Government purchases of overseas manufactured equipment. Offsets were first sought against purchases of defence equipment and civil aircraft. The program was later extended to include other major purchases by the Government including computers, telecommunications and electronic equipment It aims principally to stimulate technological advancement in Australian industries and to broaden the capabilities of industries of strategic significance. > >It achieves its objectives by obtaining tasks that either stimulate continuing activities in the same field of technology as the equipment being purchased or that result in a transfer of technology in areas of significance to Australian defence or industrial development. Other factors taken into consideration are the extent to which Australian design and development resources can be utilised and the workload that can be obtained for underutilised sectors of industry of technological or strategic significance. > >Tasks undertaken include involvement in part production programs were overseas contractors arrange for Australian industry to participate in the manufacture of selected assemblies or sub-assemblies of the prime equipment being purchased. Co-production programs are also undertaken where items are manufactured in conjunction with the overseas supplier either for domestic and overseas use or the latter alone. In some instances Australian firms have succeeded in becoming the sole suppliers of certain items. > >The program also seeks to obtain collaborative tasks which involve overseas and Australian firms participating in the conceptual, design, development and production stages of a project. > >Encouragement is also given to the purchase of Australian products of defence or technological significance by overseas firms or Governments. Commercial items that normally have ready overseas markets and purchases of primary and mineral products do not qualify as offsets. > >Since its inception in 1970 the program in total, including Defence buys, nas resulted in offsets for Australia amounting to more than $220m. In some cases overseas companies have placed orders in Australia as offsets which because of their nature will be spread over a number of years. These are included in the above figure. Most offset work has gone to the aircraft industry with computer and electronic firms benefiting to a lesser extent. > >While overseas companies are required to submit appropriate offset proposals before being awarded a major Government contract a number of companies have placed approved offset work on Australian industry without commitment. These overseas companies build up an offset credit which can be used if and when the company tenders for and obtains a contract against which offsets are required. > >It should be emphasised that the Offset Program is not an isolated means for obtaining workload for significant sections of Australian industry. In defence and public communication spheres conditions are written into contracts where appropriate, requiring that certain tasks and work content be undertaken locally. In other situations licence agreements are entered into which permit the production in Australia of specific equipment such as military aircraft, arms and ammunition and patrol craft. The Offset Program complements these arrangements by ensuring that workload is obtained relating to equipment that cannot at this point in time, for good reasons, be manufactured in Australia. > >1 ) During the eight years over which the Offset Program has operated, a total of 33 contracts incurring an offset obligation have been entered into by Departments and Statutory Bodies. > >Contracts have covered major purchases such as civil aircraft bought by TAA, Qantas and Ansett, simulators for civil airline pilot training and computers for use by Government Departments and Statutory Bodies. Details of the value of contracts entered into are contained in the summary below. > >Offsets are negotiated in a competitive situation. Details of the individual arrangements between overseas and local firms and the exact type and value of work placed in Australia are treated as company confidential. > >However the offsets generated against overseas orders have been of considerable benefit to Australian industry. While explicit details cannot be given it can be stated that aircraft component manufacture (including wine flaps, rudders, elevators, doors and escape systems for Boeing, Douglas and Fokker aircraft) is being successfully undertaken in Australia. > >Against computer purchases offset orders have been obtained for terminal manufacture, software development and component design and development. In addition offset work has also been generated in the telecommunication field in areas such as component manufacture, radar modules and electronic simulator production. > >Individual offset obligations against each contract let are a matter of discreet negotiations between the parties concerned- namely, the overseas prime supplier and the local firm receiving the offset order. Overseas tenderers are required to submit proposals for offset work to be placed in Australia to a substantial percentage of the value of the overseas order- nominally 30 per cent. This may include partproduction of the prime equipment, co-production to satisfy larger markets, or the reciprocal purchase of goods and services of Australian origin. Offset credit is also allowed for the value of transferred technology, the waiver of licence fees, manufacturing rights and royalty payments and the like. > >It is the practice with any major purchase to try to finalise offset arrangements so that aU details can be included in the contract. Where this is not possible, contractors must enter into a firm commitment to continue to try to place work in Australia up to the target level. > >Because of the confidential nature of offset negotiations and the manner by which some firms place work far in excess of immediate requirements it is not possible to identify individual offset achievements against the various contracts entered into by the Government. > >The Australian Offset Program is an ongoing scheme in which offsets are negotiated against individual contracts let, or anticipated. > >Offsets placed in Australia as a result of the program sometimes exceed the value of offsets sought. This credit can be utilised against future orders. > >In other situations there is a considerable time span between the placement of an order requiring offsets and the discharge of the offset obligation. In these cases an early comparison of offsets owed and those actually received would infer that a considerable offset debt exists with respect to certain individual contracts. This assumption should not lead to the conclusion that the full amount of the offset obligation will not ultimately be met. > >In general it can be stated that the Offset Program in its eight years of operation has been a success. In this period more that $220m worth of offsets have been placed in Australia. As well as providing invaluable workload these offsets have stimulated the technological and managerial capabilities of Australian industry. {:#subdebate-60-1} #### War Service Pensions (Question No. 2080) {: #subdebate-60-1-s0 .speaker-5J4} ##### Mr Scholes: asked the Minister for Veterans' Affairs, upon notice, on 19 September 1978: {: type="1" start="1"} 0. How many war service pensioners are receiving compensation for an accepted disability of hypertension and/or cerebral vascular accident not related to brain tumour or kidney dysfunction. 1. Are there any war service pensioners receiving compensation for the disability referred to in pan ( 1 ), not related to brain tumour or kidney dysfunction. 2. Are there any war service pensioners receiving compensation for this disability which has been accepted as stress related. {: #subdebate-60-1-s1 .speaker-KSB} ##### Mr McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP -- The answer to the honourable member's question is as follows: >Statistics are not kept in the form requested by the honourable member. > >Manually recorded disease indices are maintained in each State Branch of the Depanment of Veterans' Affairs. > >A search of these indices would require a considerable, and expensive, manual effort. > >It would also be difficult to identify relevant cases as the indices are kept in different terms from those used in the question. {:#subdebate-60-2} #### Telecom (Question No. 2125) {: #subdebate-60-2-s0 .speaker-JM9} ##### Mr Armitage: asked the Minister for Business and Consumer Affairs, upon notice, on 19 September 1978: {: type="1" start="1"} 0. 1 ) Is Telecom bound by the provisions of the Trade Practices Act or its Regulations in regard to the question of competition. 1. If so, what are the relevant sections of the Act or Regulations. 2. If not, why is Telecom excluded from the competition provisions of the Act and/or Regulations and what are the relevant sections of the Act and/or Regulations which exclude it. {: #subdebate-60-2-s1 .speaker-CG4} ##### Mr Fife:
Minister for Business and Consumer Affairs · FARRER, NEW SOUTH WALES · LP -The answer to the honourable member's question is as follows: (1), (2) and (3) So far as Telecom carries on a business it is, by section 2a of the Act, bound by the provisions of the Trade Practices Act. However paragraph 51 (1) (a) of the Act excepts from the restrictive trade practices provisions of the Act, acts or things specifically authorised or approved by other Commonwealth Acts or regulations, other than Acts relating to patents, trade marks, designs or copyrights. The Telecommunications Commission Act 1975 specifically authorises or approves certain matters (e.g. monopoly on operation of telecommunications installations within Australia- section 94). The question of whether particular conduct of Telecom is subject to the Trade Practices Act would therefore depend on the resolution of questions of fact and law in the circumstances of particular cases. {:#subdebate-60-3} #### Department of Primary Industry: Computers (Question No. 2207) {: #subdebate-60-3-s0 .speaker-RK4} ##### Mr Hayden: asked the Minister for Primary Industry, upon notice, on 27 September 1978: {: type="1" start="1"} 0. How many computers are (a) owned, (b) operated, (c) in the process of being purchased, (d) rented, by his Department, and Statutory Authorities and business undertakings under his control. 1. What is the cost of purchase or rental of each computer. 2. For what purposes is each computer used. 3. What is the nature of the data stored by each computer. 4. What interconnections exist or will exist between any of these computers. 5. Who has access to each computer. 6. What savings in staff numbers have been achieved or are anticipated as a result of the installation or operation of each computer. {: #subdebate-60-3-s1 .speaker-5E4} ##### Mr Sinclair:
NCP/NP -- The answers to the honourable member's question is as follows: {: type="1" start="1"} 0. The Department of Primary Industry owns four and rents one mim computer. The Statutory Authorities under the Minister's control own a total of twenty-one computers with one on order and one being rented. The answers for questions 2-7 are set out below in respect of each computer within the Department of Primary Industry and in respect of all computers owned or rented by each Statutory Authority. Department of Primary Industry Computer No. 1 and No. 2- Bureau of Animal Health {: type="1" start="2"} 0. The cost of these computers was $29,000 each. 1. Both computers are used in the development, implementation and running of the Australian National Animal Disease Information System. 2. Information stored consists of detailed records of activitites associated with eradication of bovine brucellosis in Australia. 3. Information is able to be transferred at present by computer medium (disk or diskette). 4. Only scientific officers employed full time by the Australian Bureau of Animal Health have access to each computer. 5. The computers have been an integral feature of the program from the outset and no staff savings have therefore resulted from their use. Computer No. 3- Bureau of Agricultural Economics {: type="1" start="2"} 0. The purchase cost was $ 109,000. 1. 3 ) This computer is used to provide a data entry service. 2. Bureau of Agricultural Economics (BAE) rural industry survey and other data are captured on this data entry system and then transferred onto magnetic tape to the CSIRO computing network (CSIRONET) for further processing. Information is not permanently stored on this computer. 3. Other than this transfer to CSIRONET, there are no connections to other computers. 4. Only authorized departmental staff have access to this computer. 5. No staff savings have resulted from the implementation of this data entry system. However, its greater throughput capacity on data in more complex forms has enabled a greater workload to be dealt with by existing staff Computer No. 4- Bureau of Agricultural Economics {: type="1" start="2"} 0. This computer was purchased at a cost of $28,400. 1. It performs as a communications controller giving remote job entry and inter-active access to the CSIRONET computer service bureau. 2. This computer's linkage to CSIRONET is used to process and store a wide range of data both for the BAE and some other Divisions of the Department. The data stored includes extensive holdings of raw and processed data from BAE rural industry surveys, raw and processed data from surveys of Australian fishing industries, files of data which are extracted from the publications of other organisations both in Australia and overseas which form important input into BAE analyses and files of data to facilitate departmental management, for example, mailing list and file registry information. 3. Apart from the connection to CSIRONET, this computer is not connected to any other computers. 4. Only authorized departmental officers have access to this computer. 5. This computer replaced earlier forms of access to CSIRONET and has not resulted in any staff savings. However, since the Department and the BAE in particular, commenced using CSIRONET computer facilities in the early 1960s substantially increased workloads associated with the processing of survey data, the computations associated with economic analyses and the management of departmental information have been absorbed without a commensurate increase in staff. Computer No. 5- Management Services Branch {: type="1" start="2"} 0. ) This computer was rented from CSIRONET at the beginning of 1978 at a cost of $95 1 per month. 1. It performs as a communications controller giving remote job entry and inter-active access to the CSIRONET computer service bureau. It was leased specifically for the purpose of processing claims made on the Beef Industry Incentive Payments Scheme (BHPS). 2. Information on BHPS claims and payments is maintained by CSIRONET. 3. Apart from the telecommunication link to CSIRONET this computer is not connected to any other. 4. Only authorised departmental officers have access to this computer. 5. This computer has been an integral feature of the program from the outset and no staff savings have therefore resulted from its use. Statutory Authorities Australian Dairy Corporation {: type="1" start="2"} 0. The Australian Dairy Corporation owns two computers, the purchase cost of each being $29,142 and $187,438. 1. 3 ) Both computers are used for processing of information and statistics required by the Corporation to perform its functions as specified in the Dairy Product Act. 2. The data stored in the computer is of the nature required to enable the Corporation to distribute certain revenue to the industry, to enable maintenance of production statistics, and to enable proper exercising of the export permit controls. 3. There are and will be no inter-connection between these computers or with computers outside the Corporation. 4. Only authorised Corporation personnel have access to each computer. 5. It is not possible to quantify precisely any savings in staff numbers that have been achieved. It would, however, have been necessary to employ additional staff if the functions now being carried out by the computer had to be performed manually. Australian Wool Testing Authority {: type="1" start="2"} 0. The Australian Wool Testing Authority owns and operates sixteen computers and has one on order. None are rented. The total cost of these computers is $554,233. 1. The purposes for which these computers are used are as follows: management and financial accounting; quality control monitoring and scientific computation of wool testing data plus production of final printed certificate; data entry, preparation and verification; data entry and calculations; data preparation and calculations. 2. Data stored are test measurements plus adequate sample identification to verify the validity of certificates issued, as required by international testing standards. 3. No interconnections exist with external computers or between AWTA laboratories. None are planned for the foreseeable future. 4. Only authorised AWTA operators and staff have access. 5. The AWTA installed these computers to enable an expansion of testing services. There have been no direct staff savings but additional staff would otherwise have been required to handle the large growth of these services. Australian Wool Corporation {: type="1" start="2"} 0. The Corporation rents one computer on a five year lease at a cost of $ 1 80,000 per annum. 1. Administrative support for all AWC functions, including the Reserve Price Scheme and government and industry statistics. 2. Data stored on the computer is directly related to functions carried out by the AWC, such as wool statistics, inventory details, raw wool sales, economic models of wool forecasting plus general administrative data. 3. No interconnection exists. 4. Permanent staff of the AWC employed in the ADP Department and maintenance staff for the computer supplier. 5. No direct savings are evident, since the computer was installed at the same time as the then Commission commenced its responsibilities. The responsibilities since that time have grown considerably; however, staff numbers and ADP equipment levels have remained below this rate of increase. Australian Wheat Board {: type="1" start="2"} 0. The Australian Wheat Board owns one computer costing $305,000. 1. The primary objective of the computer is to facilitate payments to growers. The other purposes to which the computer is put to use are: Stock, shipping and marketing statistics. Recording term payments due on credit sales. Processing daily selling price data. Cheque reconciliations. Sundry reports for Australian Barley Board, Victorian Grain Elevators Board and Vicrail. {: type="1" start="4"} 0. The nature of data stored in the computer is detailed below according to each of the computer functions: Payments to growers. Stock/shipping/marketing statistics. credit sales/shipments. Daily price lists/sundry reports. cheque reconciliations. {: type="1" start="5"} 0. The only interconnection or interaction between the Board's computer and any other computer is in respect of magnetic tape supplied by the Reserve Bank of Australia detailing paid cheques during a specified period. 1. Other than very occasional use of the computer by Honeywell during non-working hours, the only access to the computer is by the A. W.B. computer staff. 2. There have been no savings in staff numbers, although the advent of the computer has reduced the need for the employment of casual staff during the payment period. The major saving to the Board has been in the area of avoiding the costs which would otherwise have been payable to the Computer Service Bureau. Australian Meat and Livestock Corporation {: type="1" start="2"} 0. The AMLC owns 2 computers costing $39,800 and $60,000. 1. Both machines are used for processing the Corporation's internal data management requirements. 2. Data stored consists of payroll, superannuation, meat export statistics and internal financial information. 3. Both machines share an interchangeable central processing unit. 4. Access is restricted to authorised personnel. 5. No staff savings have been made to date but it is expected that some will occur in the future through natural attrition as the range of applications being computerised expands. {:#subdebate-60-4} #### Department of Productivity: Computers (Question No. 2226) {: #subdebate-60-4-s0 .speaker-RK4} ##### Mr Hayden: asked the Minister for Productivity, upon notice, on 27 September 1 978: {: type="1" start="1"} 0. How many computers are (a) owned, (b) operated, (c) in the process of being purchased or (d) rented by his Department and statutory authorities and business undertakings under his control. 1. What is the cost of purchase or rental of each computer. 2. For what purposes is each computer used. 3. What is the nature of the data stored by each computer. 4. What interconnections exist or will exist between any of these computers. 5. Who has access to each computer. 6. What savings in staff numbers have been achieved or are anticipated as a result of the installation of each computer. {: #subdebate-60-4-s1 .speaker-6I4} ##### Mr Macphee:
LP -- The answer to the honourable member's question is as follows: {: type="1" start="1"} 0. (a) Owned 7; (b) operated 7; (c) in the process of being purchased/rented l;(d) rented nil. 1. In respect of the seven computers already owned: In respect of one computer which is in the process of being hired: {: type="1" start="1"} 0. 3 ) In respect of those computers already owned: {: type="1" start="4"} 0. In respect of those computers already owned: {: type="1" start="5"} 0. The Digital Equipment PDP 11/10 located in Central Office, Canberra, is linked by Telecom line to the ICL System 4/50 in the Regional Office, Melbourne, in accordance with its function as a remote data terminal to the Melbourne machine. No interconnections exist or are planned between any of the Department 's other computers. {: type="1" start="6"} 0. At all installations listed in answers to parts (2), (3) and (4) above, access is limited to authorised personnel within the Department who need access in the course of their official duties. In addition, access is given to the staff of other organisations who need access to perform specific duties as follows: {: type="1" start="7"} 0. Staff savings have not been the main objective behind the installation of computers in the Department of Productivity. In answering this part of the question I am therefore providing some information on the reasons for computer installation, followed by the consequent or expected effect on sta fling where this is known. In respect of those computers already owned: Reason for Installation These computers were installed primarily to replace obsolete data processing equipment which in previous years had recorded excessive incidence of breakdown. None of the computers were justified solely on the basis of staff savings although it can be predicted that, as a result of systems using these computers, some savings may occur over the next decade in areas affected by the systems. Improvements in the timeliness and accuracy of information have occurred since the installation of these machines and these should lead to increased management efficiency in the areas affected. With the installation of these computers an increase in ADP and related staff at each factory has occurred and this increase is shown in the table below together with the anticipated savings of equivalent non-ADP staff. The increase in ADP and related staff is due to the recruitment of Computer Systems Officers who provide support to the systems under development {: type="a" start="d"} 0. Patent, Trade Marks and Designs Office-NCR C151. Installed: April 1978. Reason for Installation This computer was installed to replace electro-mechanical devices which were prone to malfunction and downtime, and as a means of increasing efficiency in the Patent Office. In the submission to the Interdepartmental Committee on ADP under the heading Staff Savings, the Department stated: Existing staff will increase their throughput and work more efficiently and accurately when assisted by computer systems. These benefits have been quantified by the equivalence of staff savings of the order of $ 1 58,920 which includes 100 per cent overhead '. Data processing staff who previously manned the electromechanical devices are being retrained to man this new computer and organisation proposals are being prepared to enable two Computer Systems Officers to be recruited. Initially therefore it is proposed to have a small staff increase as a result of this installation. It is too early to assess: whether or not any saving has been achieved, or what effect any savings will have on staff numbers in the non-ADP areas of the Patent Office. {: type="a" start="e"} 0. Government Aircraft Factories- Burroughs B1726. Installed: 1975 Reason for Installation: This computer was installed as a replacement for a smaller computer which had been in operation for approximately 10 years. The installation was part of an overall attempt to improve management systems and to improve the availability of information on the factories ' projects. Staff numbers in the data processing area of the factories have increased by eight (8) as a result of Computer Systems Officer recruitment. The effect on non-ADP staff in the factories in terms of numbers is not readily available but it is believed that significantly productivity gains have been made in the management areas as a result of the installation. The factories look to advanced technology to attract work from the world aerospace industry, thus maintaining employment in the industry in Australia. {: type="a" start="f"} 0. Regional Office (Victoria)- ICL System 4/50 Installed: 1968 This machine was installed approximately 10 years ago and because of: the time the machine has been installed; the changes in departmental structures in that time; the lack of records relating to staff savings; and the difficulty of providing meaningful estimates of staff savings; it is considered not practicable to provide the details sought {: type="a" start="g"} 0. Central Office (Canberra)- {: #subdebate-60-4-s2 .speaker-5E4} ##### Mr Sinclair:
NCP/NP -- The answer to the honourable member's question is as follows: >The Department of Primary Industry owns four and rents one mini computer. The statutory authorities under the Minister's control own a total of twenty-one computers with one on order and one being rented. The answers for questions 1-3 are set out below in respect of each computer within the Department of Primary Industry and in respect of all computers owned or rented by each statutory authority. {: .page-start } page 3394 {:#debate-61} ### PDP11/10 Installed: 1976 Reason for Installation: This equipment is a Remote Data Terminal connected by Telecom line to the ICL System 4/50 (see 'e' above) in Melbourne. Staff savings were not an objective in this installation as the machine was installed to facilitate the movement of data and information between Melbourne and Canberra. In respect of the computer in the process of being hired: Reason for Acquisition: This computer, when installed, will provide a production control facility which in turn will provide improved management information and enable more efficient operation in the workshop. The machine was not justified on the basis of staff savings but on the basis of expected improvements in efficiency and productivity at the management level. Finally I would make the general comment that in relation to the computers installed at: Ordnance Factory, Maribyrnong; Ammunition Factory, Footscray; Small Arms Factory, Lithgow; and Government Aircraft Factories the increases in staff employed in the ADP and related areas have been contained within the total employment levels allocated to each location. Department of Primary Industry: Computers (Question No. 2236) MrHayden asked the Minister for Primary Industry, upon notice, on 27 September 1978: >1 ) In respect of each computer owned or operated by his Department and statutory authorities and business undertakings under his control, what information stored therein can be sold, hired, lent or given to any person or organisation other than properly authorised employees of his Department, authority or business. > >Under what circumstances can this information be (a) sold, (b) hired, (c) lent or (d) given. > >On what occasions, and to whom, has any information been sold, hired, lent or given in the past {: .page-start } page 3395 {:#debate-62} ### DEPARTMENT OF PRIMARY INDUSTRY Computer No. 1 and No. 2- Bureau of Animal Health Computer No. 3- Bureau of Agricultural Economics Computer No. 4- Bureau of Agricultural Economics A report based on information stored on CSIRONET has for some years been supplied annually to BAE survey cooperators. Each co-operator is supplied with a computer printout which summarises the data collected on his or her farm together with the relevant average figures for farms in the co-operator's region. Co-operators are thus able to compare their own performance with the average performance of other farms in the region. No information about other individual farms is given. The BAE is returning data to its source in this case. The BAE has entered into joint survey collection arrangements with State departments of agriculture. Survey cooperators in this situation are made aware of the joint collection arrangement with the usual specific assurances in this case relating to both organisations. Such a joint collection arrangement has been made twice since 1973. In each case individual data and tabular output were made available to the State department from information stored on CISRONET. The Director of BAE has loaned sets of BAE survey data to agricultural and economic researchers usually in universities. In each case the Director has satisfied himself of the integrity of the individual or organisation concerned, that there were no other suitable data available for the task, and that the research to be undertaken was of value to the Bureau's own work program and to agricultural economic research in Australia generally. All personal identification has been removed from the set of farm survey data provided. The figures given could not be identified with any individual BAE survey co-operator and were not of value for purposes other than genuine technical professional research. On completion of the research project all materials provided by the BAE have been returned or destroyed. Computer No. 5- Management Services Branch Since payments made to beef producers under this scheme are assessable income, and in accordance with Section 264(1-3) of the Income Tax Assessment Act, the Commissioner of Taxation is supplied with a list of names, addresses and payments made under the Scheme. The list of applicants, names and addresses has also been used to draw a random sample of four thousand seven hundred and fifty-six beef producers for use in a voluntary survey of farmers attitudes to Infectious Bovine Keratocojuntivitis. The survey is being undertaken by a school of veterinary studies at a university and the project is funded by the Australian Meat Research Committee. The veterinary school has provided a specific assurance that the sample of names and addresses provided will only be used for the purposes described. {: .page-start } page 3396 {:#debate-63} ### STATUTORY AUTHORITIES Australian Dairy Corporation ( 1 ), (2) and (3) No information can be or has been supplied to any person or organisation other than properly authorised employees of the Corporation, except in special circumstances. These special circumstances relate to the provision to the Australian Government and to appropriate sectors of the Australian dairy industry of certain factual production statistics to enable the industry and the Government to make the necessary managerial decisions within the industry. Australian Wool Testing Authority Australian Wool Corporation Australian Wheat Board Where a grower signs an authority for information to be released to the Bureau of Agricultural Economics for survey purposes. State Probate Officers in respect of deceased estate. To Federal/State courts upon subpoena. Lists of growers names and addresses to the Commonwealth Electoral Office in order to conduct AWB elections. To any person where a grower authorises in writing the release of his own information to that person. Australian Meat and Livestock Corporation

Cite as: Australia, House of Representatives, Debates, 23 November 1978, viewed 22 October 2017, <http://historichansard.net/hofreps/1978/19781123_reps_31_hor112/>.

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