31st Parliament · 1st Session
The PRESIDENT (Senator the Hon. Sir Condor Laucke) took the chair at 10.30 a.m., and read prayers.
– I present the following petition from 20 1 citizens of Australia:
To the Honourable the President and Members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth:
That we the undersigned, believe in and support the idea that Australia should join in with the current American, Russian and Canadian efforts for SETI- Search for ExtraTerrestrial Intelligence- using existing facilities and personnel.
And your petitioners as in duty bound will ever pray.
Petition received and read.
– I present the following petition from 132 citizens of Australia:
To the Honourable the President and Members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth that the construction of a uranium enrichment plant in North Queensland and the mining of uranium on the Herveys Range area should not be proceeded with on the following grounds:
1 ) No safe method has yet been devised for the disposal of nuclear waste.
The mining of uranium ore exposes workers to considerable danger from radon gases.
The danger of poisoning chemicals seeping into surface and underground water supplies as a result of uranium ore mining and refining of uranium ore could pose serious health hazards for persons living in the Townsville region.
Your petitioners most humbly pray that the Senate in Parliament assembled should take all possible steps to abandon or postpone indefinitely the mining of uranium in the Herveys Range area, and the construction of an enrichment plant in the Townsville region.
Petition received and read.
-1 present the following petition from 9 citizens of Australia:
To the Honourable the President and Members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth:
That further cutbacks in Commonwealth funding to State Schools and transferral of funds to wealthy independent schools as required under the guidelines to the Schools Commission announced by the Minister for Education in early June arc of vital concern in that they mitigate against the interests of the great majority of Australian Children in State Schools.
That Queensland State Schools have not reached the Resource Usage Targets set by the Schools Commission, and even at those financial levels will fall well short of actual provision standards envisaged by the Commission.
That Queensland’s effort in respect of Capital works is particularly of concern being less than half the per capita effort of other States.
Your petitioners therefore call on their legislators to ensure:
That Federal funding to State Schools is restored to at least 1974-75 levels;
the independence of the Schools Commission to recommend the allocation of funds to schools on the basis of need, unhindered by Government directive; and
that sufficient funds are provided to Queensland, appropriately tied, to ensure achievement of National standards in this State.
And your petitioners as in duty bound will ever pray.
Petition received and read.
– I present the following petition from 1 52 citizens of Australia:
To the Honourable the President and Members of the Senate in Parliament Assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:
That whereas the Government has not sought to increase radio licence fees for Citizens Band radio users it has recently raised licence fees on marine two way radios and marine base stations.
Your humble petitioners believe that by increasing these licence fees the Government has: discouraged the use of this vital safety device from being fitted to all marine craft; placed an additional burden on organisations such as the Volunteer Coastal Patrol who volunteer their services free of charge to help save lives and who rely extensively on marine two way radios and base stations; added greatly to the costs associated with enforcing these licence fees; and placed revenue collection ahead of the lives of users of marine craft.
Your petitioners humbly pray, that the members of Parliament assembled will take steps to reverse the licence fees to a more modest or nominal fee in keeping with safety equipment that does and can continue to save many lives and at the same time save the Government thousands of dollars on air and sea search and rescue operations.
And your petitioners as in duty bound will ever pray.
– A petition has been lodged for presentation as follows:
To the Honourable the President and Members of the Senate in Parliament assembled. The humble petition of the undersigned members and ex-members of the Citizens Forces of Australia respectfully showeth:
Your petitioners therefore humbly pray
Your Honourable House take appropriate action to resume the award of the several distinctive and historic Reserve Forces Decorations and Medals to members of the Royal Australian Naval Reserve, Citizens Military Force (Army Reserve) and Citizens Air Force.
And your petitioners as in duty bound will ever pray. by Senator Hamer.
– My question is directed to the Minister representing the Minister for National Development. I refer the Minister to an answer he gave yesterday relating to supplies of avgas. In paragraph 3 of the answer he said:
That is the National Iranian Oil Co.- may be in a position to determine export availability around October/November this year.
In paragraph 5 the Minister said that the Minister for National Development: had commenced discussions with the oil companies with a view to increasing Australia ‘s refinery capacity -
Is it correct that there was a submission put to Cabinet on Monday of this week, before the Minister answered this question, in which it was made quite clear firstly that the possibilities of supplies of avgas from Iran were remote indeed, contrary to the answer given in paragraph 3 yesterday? Secondly, was it also not made quite clear in the Cabinet submission that supplies of avgas from Australian refineries would not be available for at least 1 8 months to two years? In view of those facts is not the answer the Minister gave yesterday totally misleading in relation to this important and urgent matter?
– I thought that the Opposition would have realised by now that members of this Government regard the deliberations of Cabinet as confidential. They will not reveal what transpires at Cabinet meetings. Senator Button asked whether certain answers that were provided by me yesterday on behalf of the Minister for National Development are correct or whether they are misleading in any way. The Minister for National Development provided the answers after careful consideration and after a question had been asked the day before. In the light of some reflections made by Senator Button upon the answers, I will refer the honourable senator’s comments to the Minister for National Development and ask him to provide any further , comments.
-I wish to ask the Minister a supplementary question. Firstly, is it a fact that Australia’s refinery capacity will not produce supplies of avgas for 18 months to two years? Secondly, is it a fact that no supplies from Iran are assured for 1979 and 1980?
– I do not propose to add anything to my answer which I provided yesterday on behalf of the Minister for National Development. I will refer those additional questions to the Minister.
-My question is addressed to the Minister representing the Minister for Foreign Affairs. I refer to radio reports today on what appears to be a major human disaster in Kampuchea. Has the Government received any official or further reports on this disaster? In addition to the gifts of rice which have been announced today are there any other plans for relief from Australia? Are there any international negotiations in relation to this matter in which the Government is involved? Does the Minister expect the situation to affect the already complex problem of other refugees from Indo-China?
-As to the general situation in Kampuchea, the Government has made a number of statements over recent months. In common with the people of Australia, the Government has been horrified at the death and disaster that has happened in that country. The diminution of the population, which has reached the proportions almost of genocide, and the war that has gone on there have been matters of public comment by the Government. It is perfectly clear that the situation is very much complicated by the major power politics of the Russian and Chinese conflict in the area. Certainly, the refugee problem, the shortages of food, and the nature of the regime there will tend to aggravate the increase in the number of boat people, and the Government and the Minister for Immigration and Ethnic Affairs have been making major efforts in that regard.
My advice is that unless large scale humanitarian relief is provided soon, famine and associated health problems will result in a further major human tragedy in Kampuchea. Senator Mcintosh directed a question to me on Tuesday on this matter. In response to a recent approach from the World Food Program, the Government has approved the immediate provision of 3,500 tonnes of rice for distribution in Kampuchea by the World Food Program. Several international agencies are currently negotiating with the Kampuchean authorities with a view to reaching agreements for the implementation of an international relief program. The value of Australia’s contribution is approximately $ 1 .7m and will be taken from the bilateral reserve for emergencies.
The decision to commit Australia to contribute to an international operation was made on the understanding that every effort would be made to arrange for relief supplies to be distributed throughout Kampuchea, that no political strings would be attached by any side to the provision of assistance, and that the distribution of supplies would be supervised and monitored by the relevant international agencies. It has been made clear that the Australian contribution would carry with it no implication of recognition of the existing regime. Australia also will consider making a further contribution to humanitarian relief efforts in Kampuchea when an international appeal is launched.
The Government believes that with the imminent prospect of a human disaster in Kampuchea, it is vital that massive international relief reach the Khmer people at the earliest opportunity. It is because of the urgent need for food aid that the Government has approved the immediate provision of rice, even though the relevant international agencies are still negotiating the modalities of distribution with the Kampuchean authorities. The Government hopes that, with the co-operation of all interested parties, mass starvation, death by disease and a renewed refugee exodus into Thailand can be mitigated or averted.
– Is the Minister representing the Minister for Health aware of reports that prices for proprietary pharmaceuticals can vary by as much as $ 1 from chemist to chemist and that this is due to the pricing policies of the drug companies? In view of the large sums citizens spend on pharmaceutical goods, can the Minister indicate what relief the Government or the Trade Practices Commission can provide to bring about some standardisation of price of such medicinal products?
– I will need to refer Senator Gietzelt ‘s question to the Minister for Health and seek some information from him on the matter.
– I direct a question to the Attorney-General. In the coin theft scandal involving Mr David Gee and Mr James Miller Henderson, were coin dies stolen from the public collection? If so, where are these coin dies now and what action is being taken to restore them to the Australian public? If they are not in the possession of the proper authorities, is it possible that they could be used again to reactivate or perpetuate the coin scandal? Finally, what measures are being taken to ensure that public collections can be protected from the activities of unscrupulous coin experts?
– Some aspects of the question asked by Senator Baume go beyond my responsibilities or knowledge, but insofar as I can provide information in answer to the question I do so as follows: Mr David Gee was convicted of stealing certain coin dies from a collection that was under the control of the New South Wales Government. As far as we know, none of these dies has been recovered. At all times all coin dies in the Commonwealth collection at the Royal Australian Mint have been adequately protected and accounted for. I do not know where the stolen dies are now. In a statement from the dock at his trial, Mr Gee said that he got the coin dies from a fellow coin collector and had returned them. They have not been recovered by the police and no further information has come to hand which would assist in their location.
If the coin dies are still in existence, they could be used again. However, none of the dies is for a coin that is in everyday use. Coins made from the dies would be of special interest or value to coin collectors. To the best of my knowledge, the Commonwealth collection of dies which is held at the Royal Australian Mint has always been adequately protected and accounted for. Since the facts of the Gee case came to light new and more stringent security measures have been introduced to protect that collection of both dies and coins. I am not aware of the measures taken to protect the State collections. Senator Baume asked what measures are being taken to ensure that public collections can be protected from the activities of unscrupulous coin experts. It is a matter of concern that coin collections could be affected or, in some way, put at risk as a result of the existence of the dies. Although I said the dies are not for coins in current use, nevertheless they would affect collectors items.
– You are better on this than you are on avgas.
– This matter happens to be within my direct responsibility, senator. There are, as I have said, aspects of Senator Baume ‘s question which go beyond my responsibility. I share the concern expressed by Senator Baume on behalf of collectors. I will refer the matter for further consideration to the Minister for Administrative Services who is responsible for police and to the Treasurer who is responsible for the coinage.
– My question is addressed to the Leader of the Government in the Senate and follows the question asked earlier about aid to Kampuchea. The Minister’s answer was to the effect that the Government has now decided to provide aid to that country. I refer to the question asked by Senator Mcintosh two days ago in the Senate concerning aid to Vietnam and Kampuchea to which the Minister in reply stated:
The Government had decided to terminate its aid to the area on one very good basis. The Vietnamese were sustaining a very severe military action.
In view of the Government’s changed policy now and its decision to provide aid to that area, does the basis on which it refused to provide that aid earlier no longer exist?
– Had Senator Wriedt read out the whole substance of Senator Mcintosh ‘s question and of my answer, he would have revealed that the relationship in my answer was to the reason why we had terminated our aid to Vietnam, which was that Vietnam had sought warlike action against Kampuchea. In our view, any domestic aid to Vietnam enhanced its capacity for military warfare. I went on to say that. This is an entirely different situation. This is a situation in which aid is being given as a special measure to the people of Kampuchea themselves who, being the victims of devastation from war, are starving. I was referring to the grounds on which we had withdrawn our aid to Vietnam itself.
– I ask the Minister representing the Minister for Defence: Is it true that Navy oil storage tanks at Windsor, Brisbane, have been sold and are to be dismantled? If so, on what basis was this decision made? What effect will it have on our ability to meet a defence crisis?
– I am not aware of any such action on the part of the Department of Defence. I am aware that the Government and the Department of Defence are taking effective measures to ensure that throughout Australia there is substantial storage and maintenance of oil for our defence needs. As to the specific oil storage to which the honourable senator refers, I will refer the matter to the relevant Minister and seek his comment.
– I direct my question to the Minister for Science and the Environment. It is prompted by the warning of Professor Harry Messel that some crocodile species in northern Australian waters face extinction. I ask the Minister what action the Australian Government contemplates, probably in partnership with the Northern Territory Administration, with particular emphasis on how satisfaction of our fishing needs can be balanced with a preservation of the crocodile habitat. What result has been obtained for the Finniss River from money channelled in after the second Fox report? Thirdly, but by no means least, what is to be the fate of the crocodile which, we have heard, adopts a militant posture when it hears a power boat? Is it marked for slaughter, or will the Government accept Professor Messel’s plea and leave it be, a militant advocate for the retention of its own habitat?
-Some of the questions that are asked by the Opposition are nearly impossible for me to answer, but I will do my best. Crocodiles are a matter of concern to me. The honourable senator, who is obviously interested in this matter, will know that the Federal Government recognises that the two species of crocodile in Australia, the salt water crocodile and the fresh water crocodile, are endangered. For the benefit of those who are cackling on the Opposition side, both species of crocodile basically are protected throughout their range, and indeed are listed on appendices of the Convention on International Trade in Endangered Species of Fauna and Flora.
The honourable senator is correct in saying that during the last few years, in order to find out more about the biology and ecology of crocodiles, the Federal Government has financed in part the research that has been undertaken by Professor Messel. The Australian National Parks and Wildlife Service commissioned a review on the status, conservation and management of crocodiles. An assessment of the potential for the commercial exploitation of crocodiles in Australia was conducted by Dr Webb of the Australian Museum. With the eventual completion of the Kakadu National Park, there will be great concern for the protection of the two species of crocodiles. There will be options for the control and management of fish, including the barramundi, which are threatened in those northern rivers, not only because with the netting of fish crocodiles are caught in the nets and generally drown but also because concern is now being expressed about whether barramundi will be able to survive under existing conditions. The honourable senator would know that, on the introduction of buffaloes, they greatly damaged crocodile nests and destroyed fresh water swamps. The Federal Government has a policy of eradicating buffaloes as one of the threats to crocodiles, except where they are in small controlled areas within the park.
I have not had addressed to me for my consideration the question of what posture we are likely to take with respect to crocodiles which are prone to nip the motors off the back of speed boats. Obviously, it is a scientific question and I will do my best to seek an answer to it.
– Has the Minister representing the Treasurer seen a report regarding a tax plan providing superannuation benefits which has been developed by the Australian Association of Surgeons? Is it a fact that a loophole exists which would admit the legality of such a plan? Is it a fact that such a scheme would mean a loss of government revenue of the order of $2 8 m annually? Is the lack of superannuation and similar benefits one of the main arguments for the very high fee-for-service charged by medical practitioners and their consequent very large incomes? Would it not be desirable to encourage the provision of superannuation and similar benefits, provided there was a corresponding substantial drop in the fees charged by medical practitioners receiving such benefits and providing such a fee drop was enforceable? Would not such a trade-off benefit both the medical profession and the community?
– Be careful now.
– That’s a change after what you said about me yesterday.
- Mr President, I notice from the interjections that both the lawyer, Senator Button, and the doctor, Senator Grimes, will be appearing before their respective ethics committees to say publicly what they have said in this Parliament. I will welcome the opportunity to have a copy of the script when they do. If they believe what they are saying now by way of interjection they have an ethical duty as practitioners to go before their respective ethics committees. So let us not have any further interjections.
I have a brief on the matter raised in the honourable senator’s question. My understanding is that the proposal described in the question has not yet been finalised. I understand also that that and other rather similar proposals have been discussed on a preliminary basis with taxation officials, when it was pointed out that whilst income tax deductions for superannuation contributions to provide benefits on retirement are allowable in the case of funds for the benefit of employee surgeons and other medical practitioners in the same way as they are allowable for other groups of employees, there are significant problems in the way of setting up arrangements whereby practising surgeons can be treated effectively as their own employees for income tax purposes.
I am unable to say that there is any loophole in the superannuation provisions or that the proposed scheme will result in a loss of taxation revenue. I am not aware that medical practitioners have sought to justify the level of their fees on the grounds that they are unable to make provision for superannuation and similar benefits and I am unable to comment on whether the provision of taxation deductions for selfemployed doctors would result in a substantial lowering of their fees. However, I remind the honourable senator that a task force currently is looking at a whole range of matters connected with superannuation. I am assured that the provision of superannuation for self-employed persons, including surgeons, will be one of the matters studied.
– Has the Minister representing the Treasurer noted a report in today’s Press that the Institute of Chartered Accountants in Australia has come out officially against tax avoidance schemes? In view of this welcome break between the accountancy profession and those people who would subvert our society by refusing to contribute their fair share to government revenue, will the Government ensure that the Institute President, Mr John Bishop, is immediately called in for consultation on the drafting of a new section 260, dealing with the artifices of tax bludgers? Further, can the Minister indicate what stage the drafting of a new tax law in that regard has reached?
– I read with considerable pleasure the report in the newspaper that Mr John Bishop, as the leader of the Institute, had made a statement which I think will be welcomed by all Australians. It is a statement of ethics which I was commending to other practitioners, namely, Senator Button and Senator Grimes; and no doubt there will be some consultation between Senator Tate and his colleagues in that regard. I know that the Treasurer has been in consultation with leading chartered accountants and tax experts in an endeavour to get better and more expert advice on this matter. I will refer to him the suggestion that, if he has not already done so, he might invite Mr John Bishop to put forward his views. I am not aware of the precise stage the amendments have reached. I will invite the Treasurer to comment on the matter.
– My question is directed to the Minister representing the Treasurer. Under section 78 of the Income Tax Assessment Act the Government recognises the worth of philanthropic bodies and educational institutions and allows taxpayers a deduction for donations and gifts exceeding $2 to the named bodies. Will the Government consider adding to this list the Child Accident Prevention Foundation of Australia as recommended by Mr Justice Meares?
– I am aware of the very good work of the organisation presided over by Mr Justice Leycester Meares. Over the years he has discussed his thoughts and his work with me. I am aware of the Foundation. I do not know whether it has approached the Government to seek tax deductibility. I do not know, therefore, whether the Government has considered the matter. I will bring it to the attention of the Treasurer.
– I ask the Minister representing the Minister for Post and Telecommunications what response the Government intends to make to the invitation issued by Mr Bruce Gyngell, the Chairman of the Australian Broadcasting Tribunal, to direct the Tribunal to conduct an inquiry into the problem of concentration of ownership in the media. I remind the Minister of the words of Mr Gyngell when he made public his decision on the Channel 10 takeover. He said:
The Tribunal readily agrees that the general question of the aggregation or concentration of media ownership and control is a matter of great public interest and deserving of serious examination. In so far as it relates to broadcasting and television, the question could be an appropriate subject for a special public inquiry by the Tribunal under Section 1 8 of the Act. It would be open to the Minister to direct the Tribunal to hold such an inquiry and to make recommendations to him on the matter.
I ask: What is the response of the Minister to this invitation on such an urgent matter?
– That passage now appears in Hansard more often than any other passage I can think of. It was referred to extensively in a debate in this place a couple of weeks ago. I will refer to Mr Staley the question of what his intentions are with respect to a special inquiry under the Act and ask him to respond to the honourable senator.
-Has the Minister for Science and the Environment noticed a recent article in the Australian alleging that there is a kangaroo plague on the western plains of New South Wales?
– And the Australian Capital Territory.
– According to the article, the national parks people estimate that three million kangaroos and wallabies are roaming the plains. The article also reports that the feeling in the area is that protection has got out of hand. Could the Minister inform the Senate what action, if any, has been or will be taken to safeguard the livelihood of farmers in that area?
– I have noted a number of articles relating to the problem of kangaroos in Queensland and New South Wales. The honourable senator for the Australian Capital Territory mentioned that there is some problem in the Australian Capital Territory. I think that, due mainly to seasonal conditions, every State in the Commonwealth has a problem of some infestation of these animals. The Commonwealth Government’s policy about kangaroo conservation and management programs is implemented basically by the States. It can be said that New South Wales has a proper service in this regard and knows what the problem is in that State. The discussions on the subject between the Australian National Parks and Wildlife Service and the States involve consultation with various officers, biologists, administrators, shooters, dealers and rangers, who all have important parts to play in programs. New South Wales has proposed that the quota for harvesting be increased this year. The 1978 quota was about 365,000 kangaroos and this year the request has been for a figure that is almost a doubling thereof. I have directed that approval be given to New South Wales to harvest as many as 645,000 kangaroos this year.
The survey in New South Wales of the kangaroo population has been carried out by Dr Graeme Caughley, a very responsible biologist from the University of Sydney, who has advised what the harvest figure should be. lt is of interest to note that during the past five years in New South Wales and I believe this applies in most States, it has not been possible to harvest in excess of 50 per cent of the maximum quota requested by them. The honourable senator raises an important matter. It is one which affects both conservationists and farmers and I am sure that where kangaroos prove to be a hazard it is obviously necessary for States to advocate an increase in harvesting numbers.
– My question is directed to the Leader of the Government in the Senate. Further to his answer to questions from Senators Davidson and Wriedt regarding aid to Kampuchea, I ask: What stage have negotiations between the international agencies and the Kampuchean authorities reached and when can it be expected that the aid set aside by Australia will reach the Khmer people? If no such agreement is in sight, will the Government consider giving the aid to the Kampuchean authorities direct, for immediate distribution to the starving people of that country?
– When I responded to a question from Senator Davidson, and by implication to an earlier question from Senator Mcintosh, I made it clear that the Commonwealth Government had acted rapidly because it recognised the enormity of the deprivation and starvation in Kampuchea, that it was seeking to take immediate means to get the food to the people themselves, and that it recognised the difficulties of so doing and wanted to ensure that no political barriers were put in the way, or that such foodstuffs would not be wrongly applied. I understand the implications of the honourable senator’s question but I cannot say precisely what stage negotiations have reached. I will seek that information for him. I can say that the Government will be taking every step that it can to impose a degree of urgency and immediacy upon the giving of the aid referred to. If I can obtain early information for the honourable senator I will let him have it.
– I preface my question, which is directed to the Minister representing the Treasurer, by saying that no doubt the Minister is aware of suggestions that have emanated from certain quarters lately that the lc and 2c coins be dropped from the Australian coinage. No doubt he is aware also of questions that I have asked regarding the minting of a $ 1 coin. I ask: Is the Government considering redesigning all of Australia ‘s coins with a view to reduction in size and also the issuing of coins of higher value? If not, why not? I am sure that most people in Australia would agree that our present coins are much too large and tend to wear out one’s pockets much more rapidly than they should.
– I can understand Senator Townley ‘s interest in this matter. It has been a persistent one and I notice that he is embarrassed by a growing amount of money in his pocket, which is natural enough under the trends of the Fraser Government. Senator Townley has expressed an interest in the whole question of currency and the size, shape and design of coins. He has previously expressed an interest in a special $ 1 coin. I am not aware of what consideration has been given or what steps may have been taken to redesign. I will bring the honourable senator’s question to the attention of the Treasurer and seek an answer.
– My question is directed to the Minister representing the Minister for National Development. Is it a fact that because of the difficulty in obtaining petroleum product carriers on the international shipping routes, it will be some months before distillate distribution shortages in north Queensland are overcome? When was the Government first made aware of this situation?
-I think that I have answered questions in relation to the problems of distribution, particularly of distillate, in north Queensland. I have indicated what shipments are coming forward. In relation to the obtaining of carriage on international routes, I will refer that question to the Minister for National Development and ask for an early reply.
- Mr President, I wish to ask a supplementary question. The second part of my question was: When was the Government first made aware of this situation?
– I said that I would refer the whole question to the Minister concerned.
– My question is addressed to the Minister representing the Minister for Employment and Youth Affairs. Is there to be a meeting of State and Federal Ministers of labour on Friday? Will the South Australian Minister, John Wright, be attending the meeting? If not, is his absence due to illness, or some other personal reason, or to pressure from his union masters to stay home because of the desperate state of the Australian Labor Party in the last days of the State election campaign?
– There is to be a meeting of Ministers for labour and industrial relations on Friday. I understand that the South Australian Minister of Labour and Industry, Mr Wright, has informed my colleague the Minister for Industrial Relations, Mr Street, that he will not be able to attend the meeting that is taking place tomorrow. This is a very important meeting. Its purpose is to discuss the major question which was raised at the Premiers Conference regarding the rationalisation of State and Federal laws in relation to industrial relations. This will lead to further meetings between Ministers of labour and Attorneys-General with a view to preparing submissions for a special Premiers Conference on the subject in November. So it is somewhat strange that the South Australian Minister will not be present at the meeting.
- Mr President, I raise a point of order. I ask you to rule that any further comments by the Minister are out of order. The question has been asked about the fact that the South Australian Minister has indicated that he will not be present at that meeting. It is not proper for this Minister in this chamber to canvass any reasons as to why the South Australian Minister cannot attend. This is the most puerile political exercise that I have seen this week in this chamber. If the Attorney-General has any sense of fairness, he ought not to say any more with respect to the answer.
-Mr President, if honourable senators have never before heard a frivolous point of order, I think they have heard one now. The fact of the matter is that I have been asked whether we were aware of any reasons why Mr Wright was not going. I am informing the Senate of what a very important meeting it is and how there must be some very good reason that Mr Wright is not attending.
– That is his business, isn ‘t it?
– I do not know, I think the reason that the Minister will not be attending this meeting is the business of the people of South Australia. That is all I am saying. I cannot provide any further answer but perhaps people will draw some interference from it.
– I draw the attention of the Minister for Social Security to an answer she gave to me this week to a question on the Notice Paper concerning her Department’s rejections of Social Security Appeals Tribunal recommendations. The Minister will note that so far as New South Wales is concerned, in comparison with the rest of Australia, an abnormally high ratio of the Tribunal’s recommendations is not accepted by her Department. For example, whilst 407 recommendations were accepted in the case of New South Wales, 1 34 recommendations were rejected. In respect of Queensland, 378 recommendations were accepted and none was rejected. Should I infer from these figures that the Minister’s Department regards the New South Wales Appeals Tribunal as being too lenient in its recommendations? If that is not the reason, will she look carefully at the position to ensure that her Department is not discriminating against people from New South Wales?
– I have before me the table from the answer to which Senator McClelland referred. The figures that he has quoted with regard to New South Wales are accurately stated, in that 1 34 recommendations out of a total number of appeals of 1,760 were not accepted by the Department. I will look at the reasons that these recommendations were not accepted by the Department but I would want to assure him that careful attention is given to recommendations from the Social Security Appeals Tribunal. The figures that he quoted were for the year 1978-79 and it may be of interest to look at other years to see whether a similar pattern occurs. If there is any further information that I can give to Senator McClelland, I will see that he is advised.
– 1 ask the Leader of the Government whether he has seen reports in this morning’s Press on the Australian Council of Trade Unions Congress. Mr Jack Marks, who is the assistant secretary of the Western Australian branch of the Amalgamated Metal Workers and Shipwrights Union, and who is also junior vicepresident of that State’s Trades and Labor Council, referred to a visit to the Middle East by the Western Australian Premier, Sir Charles Court, during the national controversy over charges against unionists. Mr Marks was quoted as saying:
If ever the PLO failed it was then. There were 15 holes for Court to plant trees in and there was not one land mine.
Does the Minister consider that statement to be an incitement to violence?
– I cannot say whether that comes within my jurisdiction. I think that those who read the Press can draw their own conclusions.
– I ask the Minister representing the Minister for Foreign Affairs whether, in light of the Government’s gift of $200,000 to the Red Cross for aid in East Timor and the statement that such aid is to be distributed by both the Indonesian and the International Red Cross, can he state how many personnel from the International Red Cross are available in East Timor to help in this task?
-I do not have that information available at the moment. I will seek it and see whether I can get from the relevant Minister the data to convey to Senator Primmer.
– My question to the Minister representing the Minister for Transport relates to my concern about one particular aspect of vehicles which have been converted to use liquefied petroleum gas. I understand that they present a particular hazard to emergency services attending accidents because any leak from the cylinder is virtually undetectable and potentially highly explosive. As is usual in these cases, Victoria has led the way by requiring all such vehicles to carry a special identification mark. Will the Minister give consideration to seeking agreement from all the other States for vehicles to carry a similar identification mark?
– The honourable senator raises a matter which could be quite serious. I will certainly draw it to the attention of the Minister for Transport, Mr Nixon. As the honourable senator would know, State transport Ministers meet regularly as members of the Australian Transport Advisory Council, which would be the appropriate body to take up this matter. I will draw it to Mr Nixon’s attention and ask him to deal with it with some urgency.
– I direct my question to the Minister representing the Minister for Administrative Services. Have there been discussions between his Government and the Government of the Northern Territory concerning the role of the Australian Electoral Office in the conduct of the Northern Territory Legislative Assembly elections? If there have been discussions, could the Minister indicate the outcome of them?
– I have no personal knowledge of discussions of the sort mentioned by the honourable senator. They may well have taken place. I will ask the Minister for Administrative Services, Mr McLeay, to provide the honourable senator with a reply to his question.
-Has the attention of the Minister representing the Minister for National Development been drawn to Press articles in which Mr Hayden and Mr Corcoran, the Premier of South Australia, are reported to have said that Australia produces 90 per cent of its petrol supplies from Australia’s indigenous crude oil? Do Australia’s refineries in fact produce this amount of motor spirit from Australia’s crude oil? If not, are not such statements a blatant distortion of fact?
– It is true that the present production of Australian crude oil could be processed to meet 90 per cent of the demand for motor spirit if the need arose. However, the refineries do not operate in this way. They process a mixed feed stock made up of about 70 per cent local crude and 30 per cent imported crude so that the full range of products required by the Australian market can be produced. The refinery design takes account of the properties of feed stock mix and refiners can make the necessary investment in hardware to enable them to meet the needs of the market by processing that feed stock. In the case of complete isolation from any imported crude or if an emergency arose, as I have said, the refineries could produce about 70 per cent of Australia’s needs. However, there would then be a considerable shortfall in our requirements for industrial fuels and no lubricants could be produced.
– My question, which is directed to the Minister for Social Security, arises out of a question asked by Senator Douglas McClelland. While the Minister is searching for the difference in the acceptance or rejection ratios of appeals to Social Security Appeals Tribunals, will she endeavour to ascertain whether social security payments have been made to a person in Queensland but denied to a person in New South Wales although the criteria are the same? Will she study the matter to ascertain whether this is a breach of section 1 1 7 of the Constitution?
– The Department of Social Security, when administering the Social Services Act, uses manuals in making determinations. Those manuals are uniform throughout Australia. A Social Security Appeals Tribunal recommendation needs to be judged by the Department to be in accordance with the Act and the terms of eligibility used by the Department. The Social Security Appeals Tribunals were set up by the former Government as a means of giving people the right of appeal against determinations. The Appeals Tribunals comprise a lawyer, a social worker and a member of the departmental staff. The manner of recording a decision is to forward a recommendation to the Department. At present the Department takes the ultimate decision. As I have said frequently in this place, arrangements are being made for the Administrative Appeals Tribunal to determine ultimately those decisions where the DirectorGeneral or his delegates do not uphold the Social Security Appeals Tribunal’s recommendations. In this way the ultimate right of appeal will be to the Administrative Appeals Tribunal. That will take the appeal mechanism one step further than the former Government had taken it. I believe that the ultimate right of appeal under the Social Services Act should be in the same form as it is for people having determinations made under other Commonwealth Acts. 1 hope that when the Administrative Appeals Tribunal is able to take over this part of our work there will be no reason why people should decide that the system of appeal is not fair.
To answer Senator Cavanagh ‘s question, as I said to Senator McClelland, 1 will look at the recommendations from the appeals which have not been upheld by the Department in New South Wales. I point out that in the State of South Australia, of the 1,033 appeals that were heard 33 recommendations were not accepted by the Department. Going to the other States, we find that of a total of 2,241 appeals heard 27 recommendations were not accepted by the Department.
– It looks like discrimination against New South Wales. That is obvious.
– I said that I would be prepared to look at the New South Wales position to determine the class and nature of recommendations from the Appeals Tribunal which were not accepted.
– You had better change your Deputy Director.
– It will affect them throughout their lives.
– Perhaps both honourable senators who are interjecting are making somewhat hasty suggestions with regard to the determinations made in the Department as a result of the recommendations presented.
– My question is directed to you, Mr President, as the officer responsible for this building. I ask: Do all the food handling facilities in this building comply with the standards of hygiene laid down by public health authorities? Secondly, is the design of the equipment such that adequate levels of service can be maintained and what routine microbiological investigations are made? You are aware of my high regard and respect for the staff of the Parliamentary Refreshment Rooms for their unfailing courtesy and efficiency. My concern is that they may have to operate with equipment which prevents them from doing their best.
– At all times very close care and attention are given to equipment and cleanliness, and to the presentation of food in a form which is of a very high standard. I am aware of the excellent service rendered by the staff, who in certain areas certainly work in restricted space. As to the microbiological investigations, I can assure the honourable senator that health requirements are met absolutely in this place.
– My question, which concerns Trans-Australia Airlines, is directed to the Leader of the Government in the Senate because it is an important matter, although it concerns Senator Chaney as the Minister representing the Minister for Transport. I refer to continuing reports, including reports in the Press today, that there are strong moves in Government circles to sell TAA. I direct the Minister’s attention to the statement in Hansard as recently as 29 August by the Minister for Transport, Mr Nixon, when he said that there was no truth in the reports and that discussions were proceeding with the two major operators with a view to revising the twoairline agreement covering a privately owned airline and a government owned airline. He said that the people who had been promoting the sale of TAA had been told of the Government’s decision. Because this matter could destabilise the industry and because it concerns the government airline, I ask the Minister whether there is likely to be any reconsideration of the decision announced by Mr Nixon?
– I read in the newspapers today a report which purports to arise out of a discussion in the joint Government parties room and purports to be an expression of the views of some Government senators and Ministers. What happens in party rooms is not for verification or justification outside, or indeed for report outside. I can say only that the Government has not made any change to policy with regard to its attitude to Trans-Australia Airlines. I think if there is to be any kind of change the responsible Minister will announce it. It will be done in that way and not through other means.
– I draw the AttorneyGeneral ‘s attention to his statement in the Senate on 25 October 1978 regarding the Australian Legal Aid Office. In dealing with the question of legal aid for dissolution of marriage proceedings, the Attorney-General stated:
Will the Attorney-General inform the Senate of the special circumstances which are applied in determining whether there is sufficient hardship to justify the granting of aid? Does the AttorneyGeneral agree that these restrictive special circumstances are denying assistance in cases of genuine hardship? Will he investigate the most recent guidelines for the Office with the aim of ensuring that assistance is made more accessible to those divorce applicants most in need?
– I am aware of the statement on the guidelines for reasonable legal aid which I made in the Senate in October last yearthey have been applied since then- and of the provisions in regard to those guidelines referred to by Senator Missen. I am also aware that some problems arise in relation to the application of those guidelines. I have been looking at some of these from time to time. I think it would be preferable if I did as the honourable senator requested and get a fuller statement and provide a more detailed report for him.
-Can the Minister representing the Minister for Health advise me whether the National Health and Medical Research Council has standing committees on health education and health promotion? If so, what are the essential differences between the two? What are the terms of reference of the two committees? What is the membership of those committees?
– I am sorry I am not able to advise Senator Coleman on those matters. I will refer the question to the Minister for Health and seek information for the honourable senator.
– My question is directed to the Minister representing the Treasurer and concerns Commonwealth grants to South Australia for transport or, indeed, grants for other purposes. I note on this topic the enormous inconvenience and annoyance felt by the public in Adelaide arising from this week’s widening and irresponsible union imposed bus strike. Given the generous financial assistance for urban transport that the Commonwealth Government gives to South Australia and other States, can the Commonwealth guarantee that such funds will not be used for environmentally damaging and unnecessarily expensive and grandiose schemes such as the North-East Area Public Transport Review which is proposed by the South Australian Labor Government and which would damage the approaches to the city, confuse Adelaide suburban roads and destroy the Torrens River Valley?
– The latter part of the question concerns my colleague in another place.
– Tell us about the generous grants.
– At Senator Cavanagh ‘s invitation, I will not only tell the Senate about the generous grants but also remind it that yesterday and the day before factual evidence based on Treasury figures was read into Hansard showing that South Australia had benefited far more from the Fraser Government than from the Whitlam Government. That was substantiated by the former Labor Premier, Mr Donald Dunstan, who said he had had the worst deal ever under a Federal Labor Government. He pleaded that there should be a tax sharing arrangement in order to get a better deal. I am very grateful to Senator Cavanagh for that interjection. I will refer to the Minister for Transport the specific matter raised as to throughways by Senator Teague. Of course, no Federal government can prevent harm being done by bad government. It is in the hands of the electors on polling day to rectify that matter.
-I refer the AttorneyGeneral to an answer he gave earlier in Question Time concerning the presence of the South Australian Minister for Labour, Mr Wright, at a ministerial conference to be held tomorrow in which he indicated to the Senate that that Minister would not be present. I ask the Minister: Is he now aware that Mr Wright will be present at that meeting? In view of the fact that he gave wrong information to the Senate, will he indicate the source of his information? If that information is incorrect, will he apologise to Mr Wright for what he incorrectly conveyed to the Senate?
– I cannot give the source of that information, but I will check it out. I would certainly regret it if I have been given wrong information about Mr Wright’s attendance at the meeting, but what I said was based on information which I had been given. I am certainly very pleased to know that Mr Wright will be at the meeting because, as I said, it is a very important meeting.
-Yesterday Senator Wriedt reminded me that information on a number of matters that he had sought through me from the Treasurer relating to the tax scale had not been responded to. I undertook to get that response. It came by way of a letter which passed through me to Senator Wriedt. With
Senator Wriedt’s agreement I incorporate in Hansard the text of that letter.
The document read as follows-
Treasurer Parliament House Canberra 2600 13 Sept. 1979
Senator the Hon K. S. Wriedt Leader of the Opposition in the Senate Parliament House Canberra ACT 2600
Dear Senator Wriedt,
You have sought from Senator Carrick a response from me on the table prepared by Mr Eric Risstrom of the Australian Taxpayers Association which has been taken by some to show that taxpayers will pay more tax this year than they did last year.
Since the Budget, this matter has been dealt with at some length. The essential feature of Mr Risstrom ‘s calculations is that, with an assumed increase in income of 9 per cent over the course of the year, the amount of tax payable at the end of the year will be greater than the amount which would be payable at the start of the year.
As I have said on many occasions since Mr Risstrom published his calculations, this is not a particularly revolutionary discovery. It is a feature of any progressive income tax system that as incomes rise more tax is payable. Indeed, the Government has never denied this. Mr Risstrom ‘s arithmetic is correct. It is also clear that if tax indexation had operated for 1 979-80, as well as the tax reduction announced in the Budget, taxpayers would be still better off. It was not possible, however, to allow such a large additional cost to revenue.
One should not become bemused by the spectacular percentage increases in tax at low incomes shown in Mr Risstrom ‘s tables. When the base of a percentage is small, a large percentage of that base is still small. To use an extreme but nonetheless valid example, if one starts in 1978-79 with an income of $3,894 (i.e., $1 above the tax threshold), last year’s tax would have been $0.33. If income increased by 9 per cent in 1979-80, to $4,244, this year’s tax would be $1 16.07, an increase of about 35,000 per cent (after tax income rises by $234.26). Or if one starts at a slightly lower income, tax would be nothing last year and something this year- an infinite increase. Despite the spectacular percentages, not much is involved.
At the same time, the Government has stated- quite correctly- that after 1 December the take-home pay of every wage and salary earner will be greater.
Let me illustrate by use of the example which you raised in the Senate, namely an income level of $10,000 per year or approximately $ 1 92.00 per week. In the pay-week before I December, an individual taxpayer on this income level will pay $42.35 in tax. After 1 December, as a result of the tax changes I announced in the Budget, that same person receiving $192.00 per week will pay only $39.25 in tax. This is an unambiguous decrease in the amount of tax payable.
To imply that taxes are being increased is, therefore, absurd. Employees will see from their pay packets- and this is the practical criterion- that after 30 November their taxes will have been reduced and their take home pay increased.
It is important to realise that what Mr Risstrom is saying and what the Government is saying are not contradictory. Indeed, Mr Risstrom does not deny the Government’s claims. As evidence of this, you could refer to the debate which took place between Mr Risstrom and me on the ABC’s PM Program on 24 August. On that program Mr Risstrom himself agreed that what the Government was saying was clear and honest.
Mr Risstrom has made a further claim that there should be some ‘minor’ changes to the tax scales to remove what he considers to be undesirable features of the system. His socalled minor changes will in fact cost about $900 million and are clearly beyond the capacity of a responsible Budget.
– At Question Time on Tuesday Senator Missen asked me about the debate on the report of the Royal Commission into Human Relationships. I should mention that this debate is an Order of the Day under General Business. It can be expected to be debated during these Budget sittings, probably soon after the Estimates committees have reported.
On 8 June, in reply to a question from Senator Puplick, I undertook to see what could be done about this matter in the early stages of these Budget sittings. I would remind the Senate, however, that the Government does not arrange items of General Business. They are taken in the order in which they appear on the Notice Paper so that all honourable senators have an equal opportunity to debate them.
- Senator Messner asked me a question regarding depreciation allowances on motor vehicles. I am advised that, under the income tax law, depreciation allowances on a vehicle are available to the person who owns it. The Budget announcement made it clear that it is depreciation allowances that are to be affected by the $18,000 limit. In a lease situation the depreciation allowances are available only to the lessor, that is, the owner and, therefore, the $18,000 limit will apply to reduce depreciation allowances available to the lessor. The Budget announcement also made it clear that the $18,000 limit would be taken into account in ascertaining any balancing charges in respect of depreciation allowances that have to be made when a vehicle that cost more than $18,000 is disposed of. The Government is aware of reports of some confusion in the business world as to how the Budget proposals are to work in respect of leased cars. A persistent and, I hasten to add, quite unfounded, rumour understoood to be circulating is that, for cars costing more than $ 1 8,000, the Budget proposals mean that the income tax deductions available to lessees for their lease charge payments are to be reduced. I emphasise that this is not so. Obviously, if it had been proposed to limit deductions for lease charges it would have been an important feature of the Government’s decision and, as such, would have warranted a specific reference in the Budget Papers. There is, however, no suggestion in the Budget Papers that the deductibility of lease charges is to be limited in any way. On the contrary, the Budget Papers refer very clearly to a limit on depreciation allowances.
– Yesterday the Leader of the Opposition, Senator Wriedt, referred to a figure of $77. 3m appearing at page 75 of the Budget Speech. I gave an interim reply to his question. He responded and sought further information. I undertook to get that specific and objective information. As I explained to the honourable senator, the reduction in funds for government schools in the States for the calendar year 1980 was a much lower figure than the $77.3m which he quoted. I refer the honourable senator to Hansard of 5 June 1979, which records my announcement of the Government’s financial guidelines for the programs of the Schools Commission for 1 980. That shows a reduction of $42.6m, at estimated December 1978 price levels, for programs specifically for government schools. The figures in the Budget Speech quoted by Senator Wriedt are financial year cash flow figures, in money terms, and are not the calendar year figures, expressed in real terms, which reflect the policy decisions taken on funding levels for the Schools Commission’s programs and which are the amounts appropriated in States grants legislation during the Budget sittings. I made that clear yesterday.
More significantly still, I draw the honourable senator’s attention to the preamble to the table, at page 74 of the Budget Speech, which would have been known to him, in which it is explained that the financial year figures for schools and for technical and further education for 1979-80 are not comparable with the figures shown for the earlier years. Whereas the total expenditures for those sectors are shown in the tables for 1977-78 and 1978-79, only the specific purpose payment components are included in the 1979-80 estimates as a result of the take-over of responsibility for education by the Northern Territory Government from 1 July 1979. It follows, therefore, that in relation to expenditure for 1978-79, the figures in the table for 1979-80 are significantly lower than would otherwise have been the case had the Commonwealth continued fully to fund Northern Territory government schools.
– In relation to a question I was asked by Senator Messner about Mr Wright, the South Australian Minister for Labour, attending a meeting of Labour Ministers tomorrow and the further information provided by the Leader of the Opposition, Senator Wriedt, in his question to me asking what was the source of the information I gave earlier to the effect that Mr Wright would not be attending the meeting, I have had the matter checked out. I am now informed that yesterday Mr Wright’s Senior Private Secretary rang the Senior Private Secretary to the Minister for Industrial Relations, Mr Street, and provided the information that Mr Wright would not attend the meeting. That is as far as I can go in replying to the request for information. 1 do not want to say any more about the matter except that I am pleased to hear that Mr Wright will be attending the meeting.
-On 30 August Senator Keeffe asked me a question about the infant mortality figures which were published in the Northern Territory. He asked about the delay in providing those statistics. In fact, Dr Charles Gurd, who is the Secretary of the Department of Health in the Northern Territory, has replied directly to Senator Keeffe, but I think that as this is a matter of general interest and of interest to a number of honourable senators I should provide the Senate with the gist of that reply. Dr Gurd has advised that the Northern Territory Department of Health continues the practice established in Commonwealth days of publishing a quarterly bulletin and annual report. Both those publications are brought up promptly. Bulletin Issue No. 23 for the first quarter of this year reported the infant mortality rates for 1978. A copy of those rates was sent to Senator Keeffe.
Dr Gurd pointed out that the Aboriginal infant mortality rate last year was 48.1 deaths per 1,000 live births. That figure is significant because in 1977 there was a very worrying figure which, for the first time for many years, showed an increase in the infant mortality rate. That figure went up to 77 deaths per 1,000 live births, whereas over a period of years there had been a drop to around the 50 mark. I am very pleased, and I am sure all honourable senators will be pleased to learn that the drop has been resumed.
Just why there was that bad year in 1 977 is something which I have not been able to determine. I thought that the Senate should have its attention drawn to that response from Dr Gurd although it was sent directly to Senator Keeffe by the Northern Territory Department of Health.
I make one further comment which arises out of Dr Gun: ‘s letter. The figure of 48. 1 deaths per 1,000 live births is still, of course, a very unsatisfactory figure when compared with that for the general Australian population. In the Northern Territory the figure for non-Aboriginal infants, 9.7 per 1,000, is lower than anywhere else in Australia. That quote is from Dr Gurd. There is a substantial discrepancy between non-Aboriginal and Aboriginal infants and that, of course, is a matter for concern. However, Dr Gurd draws attention to the fact that in many countries there are very much higher rates- for example, some as high as 200 per 1,000 live births. That is not in any sense a cause for satisfaction; it merely gives the lie to the suggestion that Aboriginal infant mortality rates are the highest in the world, a statement which is sometimes made irresponsibly, and, I am sure, out of an excess of genuine concern, but which is simply not true.
Matter of Urgency
– I inform the Senate that I have received the following letter, dated 13 September 1979, from Senator Walsh:
Dear Mr President
Pursuant to Sessional Order, I give notice that I intend to move this day:
That in the opinion of the Senate the following is a matter of urgency:
The failure of the Government ‘s trade negotiations. ‘
Yours sincerely, PETER WALSH (Senator for Western Australia)
Is the motion supported?
More than the number of senators required by the Standing Orders having risen in their places-
The failure of the Government’s trade negotiations was exposed in the most dramatic way in a report on the front page of last Saturday’s Age regarding the outcome of last week ‘s discussions with United States officials in Canberra on beef quotas. Among other things it was reported that we have won from the United States a firm commitment to import at lest 590 million kilograms of beef a year. Elsewhere the report stated that if the global import quota drops below 590 million kilograms and if Australia’s share of that quota is cut, Australia is able to take redressing action such as altered import concessions. In another place it stated that counter-cyclical legislation is to be introduced in America later this year to provide for a minimum import quota of only 568 million kilograms compared with the previously promised 590 million kilograms. The report also stated that the United States delegation involved in the Canberra talks refused to alter the proposed counter-cyclical legislation but Australia did not expect to win such a concession.
What the uninformed reader would make of that bewildering array of contradictions is a matter for wide-eyed conjecture. The amazing package appeared under the headline ‘Windfall for Beef Exports’, which I think is a very significant tribute to the efficiency of the Government’s propaganda machine, at least at sub-editorial level. The sub-editors and others- the whole community- have been exposed to a three-year barrage of propaganda from initially Mr Howard, Mr Garland, Mr Fraser, Mr Anthony and Mr Sinclair, among others. I do not propose, and I have not time, to review the whole three years of that propaganda exercise, but I would like to start at last December with the return of the Prime Minister (Mr Malcolm Fraser) from his post-Christmas but pre-Boeing trip to the United States when he boasted that he had won new access to the United States beef market. The Australian newspaper, ever eager to oblige Mr Fraser, claimed in a headline:
Boost for US Beef Exports. Fraser Wins Deal.
Countless other ministerial trips to America this year have been justified on the same pretext. Although Mr Fraser made the first claim of an amazing breakthrough, a number of others quickly followed him. In March Mr Anthony globetrotted off to the United States. Commenting on the multilateral trade negotiation talks, he said that he was satisfied from discussions with Mr Bergland that the United States Administrative was firmly committed to a base import level of 1.3 billion lbs, which, incidentally, is 590 million kilograms, the figure that was mentioned earlier. In April, while on the same trip, Mr Anthony said:
For Australia, possibly the most significant part of the settlement with the United States involves guarantees covering US imports of beef.
Guarantees which are now shown to be worthless. Mr Anthony was, of course, referring to the same so-called deal that Mr Fraser had dramatically announced after Christmas. Even back in Australia, some months later, Mr Anthony continued to boast about his alleged achievements in the United States beef market. On 19 July he told the inaugural meeting of the Cattle Council of Australia:
I wrote to ambassador Robert Strauss on this matter again recently. A few days ago he advised me that the Administration continues to strongly support the inclusion of 1 .3 billion pounds minimum access level in any counter-cyclical meat import law.
That is now seen to be meaningless. That is what the Minister for Trade and Resources and Deputy Prime Minister was saying as recently as 19 July. It is now meaningless. The clear conclusion, of course, is that either the Americans were taking Messrs Fraser, Anthony and others for a ride or they have been taking the public for a ride. All of these claims of victories and breakthroughs are starkly revealed as being as worthless as a Fraser election promise. In sharp contrast to all of this very public boasting of illusory gains, I quote this item, which was tucked away in the Australian Broadcasting Commission ‘s National Farm Report of 30 August:
As from January the 1st next year, duty on imported tobacco will be reduced by 60 per cent following the multilateral trade negotiations between Australia and the United States which gave a 60 per cent drop in the US wool levy and guaranteed exports of beef. Under the agreement, Australian tobacco manufacturers who maintain their prescribed utilisation of SO per cent or more of Australian tobacco leaf, will pay 47 cents a kilo duty on imported leaf, the present duty is$1.18.
The report goes on to say that the President of the Tobacco Growers Council of Australia, Mr Don Hastie, states that: the changes will save manufacturers $7m a year, make a political football out of the tobacco industry and further threaten the viability of Australian tobacco growers. It is highly significant that there was no ministerial announcement that this concession had actually been implemented for the United States. It does, however, bear out the truth of a statement which Mr Sinclair made on 28 March pertaining to this matter when he said: . . the Government does not intend to offer one industry for another. How very true. What, in fact, the Government is doing is offering an industry to the United States without insisting on any trade-off at all. For once a Government statement can be seen to have been reliable.
With respect to beef the Age report makes it perfectly clear that the Government has failed to hold what it had so extravagantly and repetitiously guaranteed. Now that it is an accepted fact that counter-cyclical legislation will be approved by the United States Congress and Administration there are no hastily-arranged dramatic flights to Washington such as we saw last October. Can we anticipate that the Minister for Primary Industry will repeat that stunt when the Finnane report is tabled and, if so, will the one or two gullible journalists who pose as agricultural specialists again swallow the official version? Will the next serious trade-negotiating Australian politician who arrives in Washington be asked by the President what it is that he is running away from in Australia? But whether the stunt is repeated or not, it is now quite clear that the Government has failed to deliver in this matter. Not only has it failed to produce what it said that it would produce, but also the claims that it has made over almost 12 months, alleging breakthroughs and victories, have now been shown to be patently false. In this matter we are not just concerned with the United States and beef markets. I want to refer to a statement which was made not by one Minister but by two Ministers in the House of Representatives on 29 May, that is by Mr Garland and Mr Malcolm Fraser- they both decided to get into the act, to compete for the limelight- regarding negotiations with the European Economic Community. In his statement the Prime Minister, among other things, stated:
I believe that as a result of the informed debate which this occasioned there has been increasing acceptance in Europe of the basic correctness of the Australian position.
What does increasing acceptance mean? He went on to say:
I said earlier that we did not seek to overthrow the basis of the Common Agricultural Policy . . . But this is the first step forward that we have taken in this area for many, many years. I look forward to further such steps.
Where has that alleged step forward taken us? There is no answer. The Prime Minister continued:
I therefore regard what has happened as a beginning and certainly not an end of a process of continuing change to the advantage of Australian producers and, indeed, all Australians.
Precisely what change does he claim will continue? There is no clue in the statement to provide an answer to that question. He continued:
It may remain open, but what will the dialogue produce? What has it produced? He went on:
These arc all signs that Australia and the European Economic Community are on the threshold of a new and better trading relationship . . .
What signs are there that we are on the threshold of a new and better trading relationship, whatever that might mean? He continued: . . undeniable scope for signficantly increased trade and economic and political co-operation between the Community and Australia.
Precisely what does significantly increased trade and economic co-operation mean? So much for the Prime Minister. The Minister for Special Trade Representations, Mr Garland, was if anything even more nebulous. With regard to beef, he said:
This quota is to be increased, and although it is allocated on a global basis, Australia should benefit from this increase in proportion to its current share of EEC imports under the quota.
The increase was not quantified. By how much is it to be increased? He said that Australia should benefit from this nebulous and underlined increase in the quota. In addition, he said that we would get a new and much smaller quota for high quality beef. How much more will we get? Again it is unquantified. How big will the alleged quota be? In respect of cheese, Mr Garland said:
That is in return for- offered to guarantee access for worthwhile tonnage of cheese under favourable conditions.
Here we have a compound non-statement. It refers to certain conditions, which are not stated, which have been made available for European penetration of the Australian market. Unstated conditions have been made available for the penetration of the Australian market by European cheese. It also refers to the trade-off for favourable conditions of entry for Australian cheese into the EEC. What are the favourable conditions and for how much do they apply? For what quantity do they apply? Again there is no answer from Mr Garland. He went on to say:
Australian primary industries will also benefit from European Economic Community concessions on some other agricultural items, including offals, meat extracts, dried fruits and certain canned fruits.
What are the concessions and how substantial will the benefit be? Again, no clue is offered in the ministerial statement. However, the Australian Liberal- which I understand is a monthly journal of the Liberal Party- must have access to information which the Parliament does not get because it was able to say in its June issue:
The agreement on bilateral trade worth $400 million between Australia and the European Economic Community was achieved by the persistence of the Liberal- National Country Party government.
How does the Australian Liberal manage to place a precise evaluation on the nebulous and unquantified criteria given to the Parliament? Does the Liberal Party have access to material which is not presented to Parliament? If so, it is about time that that material was presented to Parliament. Or, are honourable senators to conclude- I think this is much more likely- that whoever writes for the Australian Liberal took a stab in the dark and said, ‘Well, we will write $400m, that sounds as good as any other figure’, which would be in keeping with the way in which this Government has estimated its Budget deficits, amongst other things, over the last couple of years? He may have decided to throw in any figure because he probably would not get found out and nobody would have a better idea. That appears to be what happened. The Austraiian Liberal had the audacity to publish this item under the heading ‘No help from ALP on EEC agreement’. It claimed that this magnificent achievement- which the Australian Liberal has managed to quantify on the basis of non specific data- was achieved without the support of the Opposition, which persistently knocked the Government’s efforts to gain increased access to the European Economic Community.
Of course, the Opposition is not knocking the Government’s efforts; it is condemning the Government for its failure. The Opposition is not obstructive, it would just like some results to show for the globetrotting activities of at least five Ministers who have been involved in this over the last three years; it would just like to see some results in place of the windy and nebulous rhetoric which all of them either send back while they are overseas- as the Prime Minister did last December- or which they release when they return. We condemn the Government for its failure and its wilful and persistent attempts to mislead the public with, at best, exaggerated and not unusually completely illusory stories about alleged trade breakthroughs which have been achieved. The Opposition is saddened by the spectacle of this gaggle of globetrotting Ministers, from the Prime Minister in his Boeing aircraft to lesser mortals flying on Qantas and other international airlines, all pathetically competing for the limelight by giving meaningless assurances and hollow guarantees in an attempt to justify their junketing. If the public is to be forced to foot the bill for the Prime Minister’s tandem Boeings, worth twenty million bucks, and then to fuel them as they fly around the world while he is ostensibly dealing in these trade negotiations, the public is entitled to expect something substantial as a result of it. Nothing substantial has been given.
– This is even worse than usual.
– I do not know whether Senator Baume is to reply to this motion, since he chose to interject, but if he is I would like to ask him to explain whether the following statement from last Saturday’s Age newspaper is correct:
We have won from the United States a firm commitment to import at least 590 million kilograms of beef a year.
If the global import quota drops below 590 million kilograms and if Australia’s share of that quota is cut . . . (Australia) is able to take redressing action . . .
Perhaps Senator Baume can tell us which of those mutually exclusive statements is correct. Either we have a firm commitment to a global quota of 590 million kilograms, or we do not. All that we got out of the Department of Industry and Commerce last week was that mutually exclusive pair of assertions. In fact, that was not all we got; there were also a couple of other mutually exclusive assertions. It is just not good enough. People have been fed on a diet of windy rhetoric by assorted Ministers in this Government for a couple of years. The Minister for Primary Industry compounds the lack of results by cynically using the last move within the United States to impose counter cyclical legislation as an excuse to skip from the country when he knows that something about his personal business affairs is to be published in the Bulletin. He shows no interest in it whatsoever now but I guess that interest which he displayed last October will be resurrected when the Finnane report comes down in about 3 weeks or a month.
- Senator Walsh has brought forward a motion of urgency which he calls the failure of the Government’s trade negotiations. It is a broad, sweeping claim in relation to the whole of the Government’s trade policies. I am sure those honourable senators who had the courage even to bother to listen to Senator Walsh would have expected a wide ranging attack on the Government’s trade policies. What is the case that he has brought forward? It seems to be based largely on an article in the Age newspaper. I have not seen that article but, from his account of it, either he has misunderstood the article or the Age has misunderstood major aspects of the negotiations. I hope I will be able to enlighten the Senate about that in the course of my speech.
In his usual fashion, Senator Walsh has had to lace a very weak and narrow case with his usual snide remarks about the Minister for Primary Industry (Mr Sinclair), throwing in the Prime Minister (Mr Malcolm Fraser) and Mr Garland for good measure because of their globetrotting, as he calls it. The fact is that the activities of Mr Garland, as the Minister for Special Trade Representations, have necessitated, as anyone with any sense would realise, constant moving around the world and constant attendance at discussions.
I would have thought that this Parliament would be grateful that there is a man of the competence and energy of Mr Garland who is prepared to take on such an onerous responsibility and task. The position is that this motion has been brought forward by Senator Walsh, who was not a member of but a supporter of the Labor Government from 1972 to 1975. 1 would have thought that he had great effrontery, as a supporter of that government, coming into this Senate and complaining about the trade policies of the present Government because, as I will show later, they are considerable. The Labor Government dismantled the growth formulas of the export incentive scheme, one of the major incentives for export trade; it presided over the shutout of Australia from one of our major traditional markets, the European Economic Community; and it was also in power during the disastrous shut-outs of beef from the United States and Japan in 1 974. Indeed, that Government made no approach at all to the United States for an access commitment when that tragedy hit the beef industry in 1974and 1975.
Furthermore, Senator Walsh is a leading member of the Labor Party whose policies not only had whilst in government but still will have, if implemented, most negative effects on Australia’s international trade and investment. Apart altogether from the Labor Party’s record that I have mentioned, just look at its policy in relation to uranium. Opposition senators complain about the failure of the Government’s trade negotiations but their Party, the Labor Party, is opposed to any uranium mining. Uranium will be one of the major resources of this country and it will be in major demand throughout the world, particularly in 1 980s. This is the Party that, if it were in government, would pursue a policy which could have only the most depressing and negative effects on Australia’s trade. The other difference- I think it probably is the most fundamental difference- between the Government and the Opposition so far as trade is concerned is in respect of our anti-inflation policies. Our successful anti-inflation policies are putting Australia into probably the best position it has been in for many years to advance our trade. The Government is succeeding in advancing our trade. This can be seen from the success our manufacturing industry has been enjoying in recent months. The skyrocketing inflation that Australia suffered under the policies of the Labor Government placed our exporters in a most unfavourable position when compared with our major trading partners. The policies of this Government reduced inflation levels in recent years and, as a result, we have been able to place Australian exporters, of all products, in a much more favourable position, thereby encouraging much greater activity and investment in many export industries. That is, I think, the fundamental basis for the success of trade policies and trade negotiations.
– Why didn’t he mention that?
– Of course, that is the fundamental weakness of the Labor Party’s case. It destroys the Labor Party’s case. In government, Labor pursued policies which allowed inflation to skyrocket and placed our industries in virtually an impossible position in relation to our trading partners. The alternative economic policies it would pursue if returned to government would return Australia to those high levels of inflation and have depressing effects on our export trade.
In the short time remaining to me I must refer to some of the positive achievements of this Government as far as trade policies are concerned. I mentioned earlier the importance of the export incentive schemes. Honourable senators would be aware of the new export expansion scheme which provides a very important growth formula. That is a vital incentive. Over $200m is provided in the present Budget for the export incentive grants scheme and the export market development scheme.
I turn now specifically to the subject under discussion, namely, the trade negotiations that have been conducted by this Government in recent years. I refer not only to the special trade negotiations with the European Economic Community- I will deal with some of the positive benefits that have come from those later- but also to the bilateral negotiations and bilateral agreements with a number of other countries, particularly the United States of America, Japan and the Middle East countries, including Saudi Arabia. We have had a most active and successful expansion of trade with the countries of the Association of South East Asian Nations. There has been a very great upsurge in our export trade with most countries.
Firstly, let us consider some of the benefits that we have obtained through the multi-lateral trade negotiations that have been going on for some time. Some very specific benefits have been obtained for Australia in these negotiations with individual countries. From Australia’s point of view probably the most important benefit has been obtained for the beef industry. We have now obtained for the first time a guaranteed access commitment for 70 per cent of our beef exports. This is a dramatic improvement and change from the situation that existed when we came into government.
Senator Walsh commenced his remarks by saying that the negotiations with the United States had been a failure. In fact, what we have got from the United States is a firm general agreement on tariffs and trade type commitment to a minimal global level of imports of 1.2 billion tonnes of beef of which 5 1 per cent will come from Australia. Australia has the right to adjust the overall settlement if United States imports fall below 1.3 billion lb in the event of counter cyclical measures being introduced. We have also obtained a United States duty reduction of lc per lb, phased in over a two-year period. As a result of negotiations which have taken place recently- I think they are probably the ones that Senator Walsh referred to and which were mentioned in the Age article last week- there has been an additional allocation of 16,000 tonnes of beef for Australia in 1979. This will give Australia a record 390,000 tonnes quota for 1979. Certainly, a problem could arise in the event of counter cyclical legislation coming into force in the United States but that would not affect the basic allocation or commitment of 1.2 billion tonnes which I have mentioned.
The assurance of further negotiations in the event of counter cyclical legislation being introduced refers only to that additional figure of 1.3 billion lb, that is, an increase above the 1.2 billion lb. That is the only area in which there is to be any further negotiations in the event of counter cyclical legislation being introduced. There is no reduction in that basic access figure of 1.2 billion lb. We have had a commitment from Japan to import 135,000 tonnes of beef by 1982 with provision for a further increase in 1983. The EEC has agreed to a global quota for levy free imports of frozen beef from 50,000 tonnes to 65,000 tonnes and a new levy free amount of 5,000 tonnes of high quality beef from Australia.
There have been other matters, apart from beef, on which there has been success with the EEC in multi-lateral trade negotiations. There has been an agreement under which Australia will be able to export 3,000 tonnes of cheese to the EEC. This is the first time since 1972 that Australia has had the expectation of exporting cheese to the EEC. Also, a new quota has been agreed upon for Australia to export 2,250 tonnes of buffalo meat. We have achieved new minimum guaranteed access commitments for beef in three of our major markets. This is in addition to the EEC quota for high quality beef and buffalo meat. This is giving the beef industry a major basis for future planning. As far as wool is concerned, in negotiations in the United States we have gained a 60 per cent reduction in the duty on wool, to be phased in over three years. This has removed what all honourable senators know has been one of our longest-standing trade problems with the United States. Through the multilateral trade negotiations we have obtained useful tariff reductions on a range of rural products. Unfortunately, in the time available I will not have the opportunity to go through them in detail. As far as manufacturers are concerned, as a result of our full participation in the MTN we will benefit from an overall 30 per cent average reduction in tariffs of major industrialised countries, covering processed minerals and manufactures.
Australia, along with something like 90 other countries, has participated in the multilateral trade negotiations over a long period. There has been a most imporant and vital series of negotiations and discussions to try to contain what was a serious threat and impediment to international trade by restrictive and protective measures of one kind or another. Difficult as the MTN negotiations are, and there are many problems still to be solved, at least they have proved to be a most important way of containing the serious and growing problem of restrictions in international trade.
As far as the EEC is concerned, I have indicated some of the specific benefits that have been obtained as a result of Australia’s constant negotiations in this area, particularly by Mr Garland. A major breakthrough has been obtained in the attitude of mind of leading figures of the EEC. When all is said and done, the only way in which Australia can get any solution to the problem is through a change of heart, mind and policy by leading EEC figures, and some heartening statements have been made lately by those people. Although I do not have time to quote them now, I refer honourable senators to the annual report of the Department of the Special Trade Representative and to statements made by German Chancellor Schmidt, Vice-President Gundelach of the EEC Commission, and President Jenkins, which show that in recent months there has been a very clear indication that the EEC is changing its views and probably will further modify its policies, particularly its common agricultural policy. I am sure that these changes of view can be brought about only if countries such as Australia constantly protest at the effects of the policies, visit these countries, and do the very things about which Senator Walsh has complained. One of the significant features of the record of the Labor Party and of people such as Senator Walsh is that they have been totally negative in their attitude to the efforts that have been made by the Government. Senator Walsh said that the Opposition was not criticising what the Government was doing, it was criticising only the fact that the Government had not been successful, I think he said. The Government hopes to be more successful, of course, but it can be more successful only by maintaining the efforts that have been made by Ministers in doing the very things about which Senator Walsh has complained. I do not believe that the motion brought forward by Senator Walsh is worthy of further consideration by the Senate, and I therefore move:
That the question be now put.
Question resolved in the affirmative.
Original question resolved in the negative.
Senator DURACK (Western AustraliaAttorneyGeneral) For the information of honourable senators I present the first report of the Uranium Advisory Council, 1978-79, together with the text of a statement by the Minister for Trade and Resources relating to the report.
Senator DURACK (Western AustraliaAttorneyGeneral) For the information of honourable senators I present the reports of the Industries Assistance Commission on ceramic floor and wall tiles, et cetera; and spanners and wrenches.
Senator DURACK (Western AustraliaAttorneyGeneral) On behalf of the Minister for Science and the Environment, for the information of honourable senators I present the interim annual report of the Australian Wool Corporation for the year ended 30 June 1 979.
Senator DURACK (Western AustralianAttorneyGeneral) On behalf of the Minister for Science and the Environment, for the information of honourable senators I present the interim annual report of the Australian Honey Board for the year ended 30 June 1 979.
Senator DURACK (Western AustraliaAttorneyGeneral) On behalf of the Minister for Science and the Environment, for the information of honourable senators I present a report on the National Environmental Economics Conference held in 1978. Copies of the report are available from the Parliamentary Library. I seek leave to incorporate in Hansard a statement relating to the report.
The statement read as follows-
I would like to bring to the attention of honourable senators the recent release through the Australian Government Publishing Service of the publication Environmental Economics by the Department of Science and the Environment. This book contains the collected papers of the National Conference on Environmental Economics held last year in Canberra under the cosponsorship of the then Department of Environment, Housing and Community Development and the Australian National University’s Centre for Resource and Environmental Studies and in association with the Confederation of Australian Industry.
The conference was seen as an important initiative- one which would result in a breakthrough in environmental thinking in Australia. Discussion focused on the relationship between economics and the environment. The conference was well attended by more than 250 representatives from Federal, State and local government, industry, the trade union movement, academic institutions and environmental groups. It was noteworthy in that it provided the first opportunity for these groups to come together to discuss important economic perspectives of environmental activities. The conference was successful in achieving its aim of encouraging greater interchange and debate between private industry, government, and education and research institutions. It was also effective in creating a greater appreciation of the economic implications of environmental policies. This is important for government in obtaining balanced views and objectives input into environmental planning and decision-making.
It is increasingly being recognised throughout the world that close attention will have to be paid to the economic implications of environmental policies, especially in times of changing economic conditions. At the recent meeting of the Organisation for Economic Co-operation and Development ‘s Environment Committee at ministerial level, it was concluded that ‘in the long run, environment protection and economic development are not only compatible but interdependent and mutually reinforcing’. In recognition of this, the Department of Science and the Environment is proceeding with further research and investigations directed at estimating the benefits and costs of environmental protection measures.
I commend the publication to honourable senators as an important contribution to the state of knowledge on environmental economics in Australia. I understand copies are available through the Parliamentary Library.
Senator DURACK (Western AustraliaAttorneyGeneral) On behalf of the Minister for Science and the Environment, for the information of honourable senators I present a review of the Australia Council’s activities for the year ended 30 June 1979.
– by leave- I move:
I welcome the appearance of this review of the Australia Council’s activities. It seems to me and to the Opposition that the Australia Council has established a very useful precedent by bringing before the Parliament prompt reviews of its activities during the previous financial year. As the review points out, the Australia Council has difficulty in presenting annual reports in the period immediately following the financial year because of the complicated procedures involved in accounting for individual grants and things of that kind. There have now been two reviews of this kind whereby the Australia Council has brought before the Parliament an up-to-date survey of its funding and other activities. This is most welcome.
The review presents the Parliament with a thorough account of the Australia Council’s various activities during the last financial year, but from that thorough account it is very easy to deduce that the question of arts funding in Australia has become a very urgent one. It is quite clear that successive Fraser governments have not allocated adequate funds to the Australia Council for its very important work of promoting the performing and creative arts in Australia. If one compares the current allocation for the Australia Council with the last allocation by a Labor government, one will see that the Council has slipped down by 37 per cent in the funds that it secures from this source. In no way has the Australia Council been enabled to keep pace with inflation, which to a great extent has eroded the ability of the Council to carry out its important statutory obligations.
I draw to the attention of the Senate the very significant effect of inflation on the activities in which the Australia Council is involved. Arts activities are labour intensive, and therefore the effect of wage rises on the budget of the Australia Council has been very serious. As well as the labour intensive aspect of the Australia Council, which causes such a serious inflationary effect, many arts activities are now required to tour throughout Australia. That is a most desirable situation and one that the Australian Labor Party has always favoured. Because these activities have to tour over the vast distances of Australian provincial and outback areas, the rises in the price of petrol have also constituted a serious erosion of the budget available for arts activities in Australia. With the combination of wage increases in a labour intensive industry and petrol increases for activities which are engaged in constant touring over vast distances, the effect of inflation on arts activities in Australia has been very serious. It is in the light of this situation that the Government’s failure even to index arts funding is a serious inadequacy.
I also point out that the review has drawn attention to the way in which a great deal of talent in Australia is going unassisted by the Australia Council because of inadequate funds. The review points out that awards for individual artists, writers and so forth may fall short of the number of qualified applicants. I suggest that that is a serious matter. I believe we are losing the potential talents of many creative people throughout Australia because an adequate amount of money is not available to make individual grants to assist these artists. Some artists who are unsuccessful in getting a grant will, of course, be able to continue their creative activity. They may have jobs or they may find some other source of support. However, it is undoubtedly the case that many artists, particularly young artists, who are unable to secure a grant are unable to continue their creative activity. So, a loss to the whole of Australia’s society and to our national culture is represented by these people ‘s being unable to continue.
It is also important to remind ourselves that the burgeoning Australian film and television industry of which Australia has so much cause to be proud is dependent in many ways on an adequate funding of arts activities throughout Australia. People who end up directing Australian films, scriptwriting for them, acting in them or are engaged in other ways in making films or films for television, in many cases have been assisted in the early stages by Australia Council activities. If we are to continue to have a thriving film industry and if we are to continue to develop our capacity to make films which are successful on the home market and also have a great possibility of success on international markets, we must not cut off funding at the base level.
It seems to me from a study of the review of the Australia Council that the ability of the Council to provide that ongoing assistance and encouragement to artists on whom ultimately the film and television industry depends has been seriously eroded. There have been new and extensive demands on one board in particular of the Australia Council. I refer to the Community Arts Boards, one of the newest boards of the Council. The Board’s activities probably reach more Australians than any other arts activities. I think it is the case now that in every Federal electorate in Australia there has been some activity by the Community Arts Board. It is often activity which involves children or people who have previously had very little contact with the arts. It is a most important developmental program. I think it is unfortunate- I must comment- that the Community Arts Board at this stage secures only 6 per cent of the Australia Council ‘s budget.
I point out too that the Community Arts Board has responded to a newly recognised need in this area in Australia, and that is the assistance of ethnic groups which are engaged in arts activities. There are now over 400 ethnic groups concerned with the arts in Australia, and many of these are receiving assistance from the Community Arts Board. Clearly the demand is much greater than can be supplied by the allocation of 6 per cent of the Australia Council’s budget. I hope that the Government takes note of this aspect. With the interest it claims it has in ethnic affairs, in promoting the identity of ethnic communities and in the ability of ethnic communities to retain their homeland culture in Australia, I suggest a more generous allocation would be in order in the next Budget.
The review again draws our attention to the problem of staff ceilings. I repeat the criticism I have made on many occasions of the strategy of using an across the board staff ceiling formula to reduce expenditure in the public sector. In areas where a great deal of flexibility and creativity is required, an across the board staff ceiling formula is not a way of inducing efficiency; it is a way of inducing inefficiency, although the review does state that to date the Council has been able to improve many of its procedures to maximise the effect of its staff allocation. I welcome too the emphasis on assessment and valuation procedures which the Australia Council describes. It is most important I think that bodies engaged in this sort of creative activity have some idea of where they are going and have a fairly clear idea of what has been achieved by previous programs. I think it is true to say that in the past there was neglect of internal evaluation procedures and of the effectiveness of various Council art programs.
I welcome the new emphasis on assessment and valuation procedures within the Council itself. In the same vein I welcome the various research projects in which the Australia Council has engaged. It is most important if we are to have a rational and appropriate national arts policy in this country that we actually know the needs and tastes of the Australian public. Until recently we have had very little sound indication of what the wider community wants and expects with regard to arts programs. So, I welcome the various research projects in which the Australia Council has been involved. I look forward to the results of those research projects informing all of us in Parliament of the true needs of the Australian community with regard to arts programs.
I comment too that although some developments in encouraging private patronage for the arts have been successful and that this is a development which the Australian Labor Party welcomes, the ongoing responsibility of a national government to provide national support for the arts in a wide ranging and adequate way is not in any way reduced by the appearance of private patronage. I state very firmly that it is the view of the Australian Labor Party that private patronage of the arts is to be encouraged in all possible ways but that it is always an extra. The ongoing work of providing assistance to community arts, ethnic arts, Aboriginal arts and of our major arts companies must be a government responsibility. Anything that private patronage likes to add to that is welcome, but I warn against the Government’s regarding the development of private patronage for the arts as an excuse for withdrawal of public funding. I will not take the time of the Senate any longer at this stage. I seek leave to continue my remarks later.
Leave granted; debate adjourned.
– Pursuant to section 22 of the Public Service Act of 1922 I present the annual report of the Public Service Board for the year ended 30 June 1 979.
-by leave- I move:
I seek leave to continue my remarks later.
Leave granted; debate adjourned.
– Pursuant to section 1 22 of the Repatriation Act of 1 920 1 present an interim statement on the activities of the Repatriation Commission for the year 1978-79.
– Pursuant to section 50b of the Defence Service Homes Act 1918 I present an interim statement on operations under the defence service homes scheme 1978-79.
– For the information of honourable senators I present an interim annual report of the Australian Wheat Board for the year ended 30 November 1978.
– I seek leave to make a statement and, as I will explain, to move a motion in relation to the report.
– Honourable senators will note that the report which has been tabled by the Minister for Science and the Environment (Senator Webster) is an interim annual report for the year ended 30 November 1 978. In fact that report contains no financial statements whatsoever. The operations of the Australian Wheat Board are of very large dimension running into hundreds of millions of dollars. It is a matter of interest and of some concern that the financial statements are not available. There is no explanation why they are not available. From my search so far it appears that the last financial statements presented to this chamber by the Board were those for the year ended 30 November 1976. It appears that for the last two years the financial statements have not been available. This is a matter which has been discussed by the Senate Standing Committee on Finance and Government Operations. By arrangement, I seek leave to move a motion to refer the report to that Committee.
– I move:
Question resolved in the affirmative.
-On behalf of the Joint Committee on Publications, I present the Committee’s report relating to the Annual Reports of Commonwealth Departments and Statutory Authorities, together with the transcript of evidence and extracts from the minutes of proceedings of the Committee.
Ordered that the report be printed.
-by leave-The inquiry was undertaken as a result of the matter being referred to the Committee by the then Minister for the Media, Senator Douglas McClelland, in August 1974, at which time it was found that since 1970 there had been a considerable growth in the Commonwealth publishing program and there was a tendency by author bodies to increase the size and the content of their periodicals. It was decided that the matter should be referred to the Committee. It was found that some departments did not produce an annual report at all. There was a considerable lateness in the presentation of others, and certainly a level of extravagance by some that made it necessary that the matter should be investigated. Besides that, there were always questions of what were the difficulties which were apparent in production, and so the matter was investigated by this Committee.
In all 103 submissions were presented. They came from a large cross section of departments and authorities, from librarians and other users of the reports, from Professor Olsson of the Australian Institute of Management, from the Australian Government Publishing Service and from the Auditor-General ‘s office. Evidence was then heard from a representative group of all those who had made submissions. In addition, the Committee circulated a questionnaire to all senators and members seeking their comments. This proved to be of great assistance. The Committee’s principal conclusion was that all Commonwealth departments and statutory bodies should present an annual report. This is important in principle, because their presentation to the Parliament demonstrates the accountability of departments and authorities to the Parliament, and through them to the community. It is important in a practical sense because of the information the reports provide to senators and members, and to anybody who has an interest in those various departments and authorities. For instance, honourable senators will be aware that the first annual report from the Prime Minister’s Department was tabled on 23 August. The Committee is encouraged by the fact that this has been done.
The Committee has, in the production of the report, made several recommendations towards making the annual reports more useful, more timely and more economical. I will limit my comments on the recommendations at this stage, apart from saying that the two areas of greatest concern to the Committee were the problems of delays in the tabling of the reports and the question of the appropriate standards of production.
The Committee appreciates that the Prime Minister (Mr Malcolm Fraser) has requested that production standards should be as economical as possible, and it is disappointing that this request has not been fully complied with. I would mention specifically that in the opinion of the Committee the annual report of the National Capital Development Commission for 1977-78 and that of the Pipeline Authority for 1976-77 are examples of unnecessarily expensive productions. In fact some of them are produced in the sort of glossy form which would do credit to some of the publications which are banned in Queensland. The Committee does, however, recognise that authorities which are in active competition in the market place are justified in using prestige standards of production.
Turning to the question of delays, I noticed in the National Companies and Securities Commission Bill presented on 28 August that the Commission’s annual report must be prepared not later than 3 1 October in each year. While my Committee would like reports earlier than this, the Government must be commended for defining a time limit in this legislation. To the best of my knowledge this is the first, and I commend the Minister for Business and Consumer Affairs (Mr Fife) for setting this deadline and giving it the force of law.
The important areas that were investigated were, firstly, the actual functions and importance of the reports, which I have already covered fairly well; secondly, the contents; and thirdly, standards of production. On the question of contents it was decided that there should be a statement of the legislation under which the organisation operates, the place of the authority in the
Commonwealth administration, the responsible Minister, and so on; the functions of the organisation; the Budget allocation of the funds; the number of staff employed; a brief listing of senior officers; a simple organisation chart; the bibliographical details; a list of the publications that the Organisation produces during the period under review; contact points in the organisation, and the responses that the organisation has made to criticism by other bodies or individuals during the period.
The standards of production have been fairly clearly laid down at various times by certain AGPS circulars, but they have never been completely adhered to, and there is no penalty or comment if they are not. The Committee believes that the preparation of this report should assist in having that done more regularly. The Committee also recommends that the simultaneous production of the parliamentary papers versions and the tabling versions should continue. This is a matter of economy.
The Committee trusts that the report will receive full Government support, and that it will clarify many matters not currently fully clear to the departments and the authorities. I commend the report.
Senator DURACK (Western AustraliaAttorneyGeneral) by leave- On 2 June 1978 the Standing Committee on Constitutional and Legal Affairs, in response to a reference to it from the Senate on 21 April 1977 to review the right of priority of the Crown over other creditors in matters of bankruptcy, corporate liquidations or other cases of impecunious persons or corporations, tabled its report entitled ‘Priority of Crown Debts’. As honourable senators will recall, on 26 May 1978 the Leader of the Government in the Senate (Senator Carrick) announced procedures under which the responsible Minister would make a statement in the Parliament outlining the action the Government proposes to take in relation to any report by a Parliamentary committee. The report of the Standing Committee on Constitutional and Legal Affairs, ‘Priority of Crown Debts’, falls within the portfolio of the Minister for Business and Consumer Affairs (Mr Fife) and, as Minister representing him, I now intend to outline the action the Government proposes to take in relation to the report. The Senate Committee in its report recommended the complete abrogation of all Crown priorities in insolvency administrations.
The Government has examined the report and is fully in agreement with the main thrust of the Committee’s argument. The Government supports uniformity of insolvency administration, which was of particular concern to the Senate Committee. It also acknowledges the desirability of placing the Crown as far as possible on an even footing with the private sector. Accordingly, the Government has decided to abolish all remaining Crown priorities in the Commonwealth sphere and to seek the abolition of all remaining Crown priorities in the State sphere, except in relation to tax instalment deductions and withholding tax on dividends and interest remitted overseas. Special considerations apply in relation to those two categories of debt and separate them from other Crown debts. However, the law will be amended to make it clear that the giving of credit to employees in respect of misapplied tax instalment deductions is mandatory in all situations.
It is proposed to take action as soon as possible to implement those aspects of this decision that relate to bankruptcy and company law. Consequential changes to the Income Tax Assessment Act 1936 and other associated tax legislation will be introduced by the Treasurer (Mr Howard) in due course. This action will also give effect to a long standing commitment by the Commonwealth to the States that the Commonwealth would abandon its common law priorities in company insolvencies. The Office of Parliamentary Counsel is currently preparing a Bill to amend the Bankruptcy Act. The Government proposes to include in that amending Bill a provision that omits the whole of paragraph 109(l)(j), which accords priority to a certain amount of any outstanding income taxes. A consequential amendment to paragraph 109 ( 1 ) (k), which would then become the tenth priority, will also be necessary.
To give full effect to the Committee’s recommendations, the Government is negotiating with the States amendments to the legislation proposed to give effect to the Commonwealth’s obligation under the co-operative companies and securities scheme. Those amendments will ensure that the legislation does not accord any special priority to Crown debts in corporate insolvencies other than those in relation to tax instalment deduction and dividend withholding tax. Under the terms of the formal agreement between the Commonwealth and the States in relation to companies and securities, it will not be possible to introduce the amendments unless they are approved by the Ministerial Council of Commonwealth and State Ministers on Companies and Securities.
In addition, the Government intends to legislate to abrogate the prerogative priority of the Crown in right of the Commonwealth and to ensure that, in a company liquidation, the Commonwealth is under an obligation to repay preferential payments in circumstances where other creditors would be obliged to do so. In view of the importance of these proposals to the private sector it is the firm intention of the Government that all these necessary legislative measures will be introduced as soon as possible. I commend these proposals to the Senate. I present the following paper:
Priority of Crown Debts- Ministerial Statement, 13 September 1979.
One concludes from that that the Government accepts the arguments we advanced. The arguments were not just the opinions of the Committee. We called for evidence from all over Australia. As the report reveals, in formulating our final recommendations we had the support of organisations such as the Department of Business and Consumer Affairs. To the officers of that Department the credit; they gave excellent evidence before the Committee in support of complete abolition. The Commercial Law Committee of the Law Council of Australia also gave excellent evidence and examples of problems being encountered. The Australian Society of Accountants gave evidence, as did the Institute of Chartered Accountants in Australia, the Australian Chamber of Commerce and a number of experienced liquidators and receivers. They are people with practical experience of what had been going on. They did not distinguish between the various areas. They said that a great deal of hardship was being caused to a lot of people.
In addition, the Australian Council of Trade Unions and the Conference of Commonwealth and State Ministers for Labour called for the removal of Crown priority, particularly priority over preferred claims of employees. A number of other submissions were received also, including submissions from State governments.
But opposed to the Committee’s recommendations and the views outlined in the evidence received from the organisations I have mentioned were representatives of the Commissioner of Taxation and the Department of Finance. One must congratulate the Treasury and the Department of Finance on their success. Indeed, they have succeeded in the teeth of evidence, in the teeth of the report of the Committee and in the teeth of the opinions of members of parliament and of the Government back bench committee, and even the State governments. I suppose that they could be congratulated on their at least temporary victory in retaining the major part of Crown priority.
Getting back to the statement, the Government has indicated in it a desire to place the Crown as far as possible on an even footing with the private sector. I am afraid that it is not doing that because it makes a distinction. Then we come to what I think is the essence of the statement, which unfortunately is obscure in its language.
Sitting suspended from 1 to 2.15 p.m.
Accordingly, the Government has decided to abolish all remaining Crown priorities in the Commonwealth sphere and to seek the abolition of all remaining Crown priorities in the State sphere except in relation to tax instalment deductions and withholding tax on dividends and interest remitted overseas.
Unfortunately that is grammatically in error because the tax instalment deductions and withholding tax relate to the Commonwealth sphere but in the statement appear to be related to the State sphere. I had wildly hoped that a minor and not a major area was being excluded from the reform that the Commonwealth proposes, but, despite the grammar, I am afraid that it is the major area which the Commonwealth is not going to abandon. I think it is important in this respect to understand the extent of it.
Whilst the Commonwealth is accepting here the validity of the Committee’s general approach and its conclusions, in financial terms it is proposed that the major single item priority for PA YE instalments be continued to be employed by the Commonwealth.
It is worth referring to Appendix IV of the Committee’s reports which sets out an estimatewhich came from the witnesses- of the taxation revenue losses if Crown priority were abrogated. These were Treasury calculations which nobody suggests could be completely accurate, but it was very helpful to have some idea of the nature of them. In regard to income tax it was estimated that in the case of bankruptcies $500,000 would be lost to revenue; in the case of liquidations $2,800,000; in the case of sales tax $1,700,000; and in the case of miscellaneous taxes and charges, $50,000. That made a sub-total of $5,050,000. That is the sort of figure we are talking about. That is what will be abandoned by legislation which will be brought in to carry out the proposals contained in this statement. The major item is: ‘Unremitted tax instalment deductions- stamps and group employersbankruptcies and liquidations’. The loss in that whole area is estimated to be $5m. If the Government had accepted the whole of the Committee’s report the Commonwealth would have abandoned yearly revenue of a little over $10m. Let us bear in mind that the total amount of PA YE collections in 1976-77 was $9,8 1 lm, almost $ 10,000m. We are talking about abandoning $5m. That $5m, as I will attempt to show, relates very much to areas where there are hardships, uncertainties and circumstances where great injustice is done to individuals, particularly small businesses and individuals who have small debts and small claims against companies and who find themselves overthrown in their attempts to collect those amounts by reason of the priority that the Commonwealth claims for PA YE taxation. Unfortunately the Government’s statement makes it clear that it is not going to abandon that more major item. When it comes to giving a reason for this the statement contains really only one sentence, which reads as follows:
Special considerations apply in relation to these two categories of debt and separate them from other Crown debts.
That is in regard to tax instalment deductions, withholding tax and special considerations. One feels that in that statement there would be some indication of the special reasons. The Committee’s report devotes a whole chapter to the situation of these two areas because of the fact that the Treasury and the Department of Finance were claiming before the Committee that there was some just reason that the two areas should be considered separately. But in this Ministerial statement there is not a word as to the reasons or ‘special considerations’ that the Commonwealth finds important. The Committee specifically did not find validity in such special conditions. It came to the conclusion that the arguments in the great mass of evidence before the Committee, which came, as I said before, from business, from trade unions, from governments and from the Department of Business and Consumer Affairs, were much to be preferred to the arguments advanced by the Treasury. I will turn to that chapter of the report a little later, but first I will complete the analysis of this statement.
The statement goes on to say that the Government will take action with regard to bankruptcy and company law and that there will be consequential changes to the income tax legislation. It points out that the Government will also be abandoning the common law priorities which have existed for many years. It states:
This action will also give effect to a long standing commitment by the Commonwealth to the States that the Commonwealth would abandon its common law priorities in company insolvencies.
I might say that the Commonwealth gave that undertaking to the States in December 1969. It has been a long time in being carried out, but it is to be carried out now. The amounts involved in those common law priorities are estimated to total $90,000 per annum, so that is not an item of any substantial importance.
The Commonwealth cannot carry out all the undertakings that it is now giving until it has the co-operation of the States. That is important. It is to be hoped that the States will give that cooperation because clearly the States, and the people who live in the States, stand to gain a great deal by a substantial abandonment- even if it is only 50 per cent- of the Commonwealth’s present priorities. Of course, it would not be fair to expect the Commonwealth to abandon its priorities and to find that the States, thereafter, went up in the priorities and were collecting their debts which at the moment they may not get at all. The problem is that, when the Commonwealth does what it is doing- namely, abandoning half of its priorities- there may be more difficulty in getting the States to co-operate and to abandon theirs. Therefore, the decision by the Commonwealth to go only half way along the road provides it with a bit of difficulty in getting State co-operation.
I remind honourable senators that after taking a lot of evidence the Committee analysed the hardships that were involved in the existence of Crown priority for debts, in the Commonwealth’s coming in and seizing the opportunity to take its share at the expense of all other claims. It considered not only the question of uniformity which the statement speaks about. Many hardships to individuals and to employees are demonstrated in the report. I hope that honourable senators who have not read the report will now do so because this matter will be the subject of substantial argument in the country for some time in the future. The hardships are perhaps well illustrated by quoting from the evidence that was given before the Committee. In the course of taking evidence we had before us a number of liquidators who have dealt with companies and with particular cases. I quote just two passages to illustrate the personal hardship which happens when the Commonwealth claims its priority. Two liquidators who gave evidence before us tendered a letter which listed 17 company liquidations in which the Crown had been paid at the expense of the employees. Let us bear in mind that most of these claims relate to PAYE tax collections that had not been paid by companies. Most of it comes in the area that the Commonwealth is not abandoning. In their letter the following was said:
The two largest ones are Harry McEvoy Shoes Pty Limited where we recall the employees did not get paid the monies due to them, and in particular one employee had worked with the company for something like 30 years, lost his job on the winding-up of the company, and received nothing.
The other company we recall is R. G. Brooks & Sons Pty Limited, where the Commissioner of Taxation absorbed all the monies in hand and none of the employees received monies due to them- many of them had long service leave going back for 1 7 years.
Before us also was the evidence of people who had stayed on in companies, who had not taken leave due to them. They were people who knew that their company was in trouble. They did not know what the liabilities of the company were to the Commonwealth in respect of PAYE tax and ultimately found that they were the losers. If they had left and obtained jobs somewhere else they would have been better off. Because they stayed and helped their companies they suffered. To give another example: ‘
Another liquidator indicated that in one recent matter the company had funds almost sufficient for the unpaid group tax, but that left nothing for the S3 employees who for nearly 2 years had been owed $ 1 3,000 in holiday pay.
That is an exact example of what is being retained by the Commonwealth as a liability. That situation will not be covered. Thus, hardship was a major factor which influenced the Committee in making its recommendations.
The report dealt also with the complexity of the existing law. To a certain extent, because of what is being retained, it will continue. To some extent it will be removed by the concessions that the Commonwealth is now making. The uncertainty of the law was another aspect which we strongly urged the Government to consider. As I have said, we came to the general conclusion that there was no justification for the retention in general of the Crown priority and recommended that it should be abolished. We went on to consider the position in regard to PAYE taxation, which had been the major argument made before the Committee, the matter on which a great fight had been put up by Treasury, Finance and Taxation officers. At the beginning of the chapter on that subject, the report states:
The major application of Crown priority and the area of most significance to the Commonwealth revenue applies in relation to taxation instalment deductions and, similarly, withholding tax deductions contained in Sections 22 IP and 22 1 YU respectively of the Income Tax Assessment Act 1936. They arc accordingly treated separately.
The report then went on to consider the evidence. Of course, the representives of the Australian Taxation Office asserted that these priorities were needed. They said: . . the community purse can never by advantaged by the combined operation of these two sections . . . The employees and other creditors suffer no injustice through the operation of these provisions which merely attempt to ensure that national revenue will be reimbursed, at least in part, to the credit of employees.
They took the view that people had PA YE tax deducted from their wages and that those amounts were no longer theirs; that they were held by employers as trustees on behalf of the Commissioner of Taxation; and that employees should not expect, if a company went into liquidation, to be accorded priority in regard to them. We reported as follows:
The Committee commends the representatives of the Australian Taxation Office for strenuously exercising their responsibility to protect the revenue. However, these assertions cannot bc accepted in the face of the overwhelming evidence which was outlined in Chapter IV.
That is a reference to the overwhelming evidence in the whole general area of what was required. We then analysed the various reasons that were given to the Committee for retention of priority in this case, and rejected them all. We rejected the idea that somehow moneys deducted and retained by an employer, and subsequently misappropriated by him, were to be considered moneys in trust, that the Commonwealth should be entitled to claim it ahead of all other priorities, including such things as holiday pay. We believe that that is not a correct assessment of the situation, and is not backed by the law of the Commonwealth or the statements of judges. Therefore, we did not come to the conclusion that the Commonwealth had any justification for seeking special treatment in regard to this sort of priority. We said:
The Committee rejects the suggestion that the Commonwealth should be entitled to any special priority in respect of tax instalment deductions and recommends that Section 22 1 p of the Income Tax Assessment Act should be amended accordingly. By analagous reasoning, the priority with respect to withholding tax deductions should also bc abolished and similar amendments made to Section 22 1 YU of the Income Tax Assessment Act.
The conclusion of the Committee was unanimous and certain. It was based on the bulk of the evidence that had been placed before it. However, it has now been rejected, at least in respect to these major areas, without any reason being given other than that special considerations are to be made. Unfortunately, the Government has not taken us into its confidence in regard to these special considerations. Therefore, I do not find the statement satisfactory or an explanation which will enable the Senate to feel satisfied that the Committee’s report should be rejected to that extent. As I have said before, it is clear that the Department of the Treasury and the Department of Finance have fought a bitter battle over this issue. Doubtless that has had something to do with the lengthy interval that occurred between the presentation of the report and the presentation of this statement. As I have said, those officers are perhaps to be congratulated in having apparently overcome the vast amount of evidence presented to the Committee, in having been able to override the opinions of the back bench members of the Government parties who supported the report and, as well, what the State governments have stated in evidence. However, this is not the end of the story by any means, certainly not as far as 1 am concerned and, I hope, members of my Committee also. Some of the members of the Committee who signed the report- I refer to Senators Button, Chaney, Devitt, Tehan and Wheeldon- are still very much with us in this Parliament. I hope that they too will feel that this is a report whose day should have come; that, insofar as the Government has accepted the basic evidence that the Committee has put forward, it ought to be logical. A sum of $5m is presently being retained each year at the expense and the hardship of small people in this community who, if they could get their money back, could have a claim in liquidation proceedings, would be earning more. Some of the money returned to them would flow back to the Government in taxation, so it would not be such a great loss. I think that in this case injustice has been perpetrated for many years and, although I welcome the extent to which the Government has accepted the Committee’s recommendations in theory, I do not welcome the fact that it has failed to accept the recommendations on the major area in which justice should be done.
-We are faced today with a Government decision which ignores completely the recommendations of a bipartisan Senate committee- the Senate Standing Committee on Constitutional and Legal Affairsand I will justify that statement in a moment. The Committee had recommended a major social reform whereby, upon the severe financial deterioration of a person or firm resulting in bankruptcy or insolvency, all who wanted to share in the meagre assets of that person or firm would do so equally, whether it be the community seeking to recover tax moneys, a trader seeking to recover unsecured debts or an employee seeking to recover, for example, workers compensation, long service leave entitlements or even ordinary wages and salaries.
The Committee’s recommendation was to the effect that all such creditors should be ranked equally and should share in what would be, by definition, the meagre assets available for distribution. The Government, in response to this- 1 5 months after the report was tabled- said no, and hiding behind a feudalistic notion or at least a feudalistic garb stated that the Crown should take priority over these ordinary traders and employees when it comes to the recovery of taxation where there is a bankruptcy or insolvency. As Senator Missen has so eloquently pointed out, there is no doubt that the claims of equity and fairness have been totally overcome by the perceived need of the Government to raise revenue.
The only departments and witnesses to argue against the abandonment of priority by the Crown in the gathering of taxation were the Departments of Finance and the Commissioner of Taxation. Obviously they have pressed their claim. They have remained obstinate and they have succeeded in getting the Government to agree to their original position. On 8 March I asked the Attorney-General (Senator Durack) in this place during the adjournment debate whether the delay in coming to a decision which the Government had not given in the autumn session could be explained by the fact that questions of revenue were taking priority in the Government’s mind and whether there was a danger that if the decision were delayed until the Budget session, budgetary considerations would become dominant. On 8 March, at page 716 of Hansard Senator Durack replied:
Admittedly the decision will be made outside the time originally indicated -
That is the six-months response time-
But, as 1 said. -
That is Senator Durack speaking- that is due to the complexities of the subject and not to any financial considerations, as Senator Tate feared may be the case.
I think it is beyond doubt that in the absence of any explanation offered by the Minister in putting down this statement, the only plausible explanation for the retention of Crown priority, as it is called- it is community priority, in fact- in the gathering of tax moneys, before the claims of unsecured creditors and employees are met, is the need for revenue. As Senator Missen has pointed out, the amount of revenue is not easy to determine in any case. It may be in the region of $5m or $6m, on the surface. That figure is speculative. It needs to be modified by the consideration that if ordinary traders were able to recover and share in equally the distribution of assets and if ordinary employees were entitled to receive long service leave, workers’ compensation, wage and salary claims and so on, on a par with the community seeking its taxation then, because of the lesser incidence or amount of bad debts, and because of the spending power that would be put into the hands of employees, quite a bit of that $5m or $6m apparently lost would return to Government revenues by the obvious greater income of employees and the good debts within the trading community.
This is what is so difficult to understand in this statement which has been put down. It is totally misleading. It says that the Government has examined the report and is fully in agreement with the main thrust of the Committee’s argument, but then it proceeds to completely gut the Committee report and denudes it of any real significance. To give up Crown priority in relation to trading debts is to give up a very small area indeed. That is signified by the fact that neither the Commissioner of Taxation nor the Department of Finance objected to that when appearing before the Committee. What they objected to and what they have succeeded in maintaining as an objection is the giving up of priority to the gathering in of taxation.
What is the bankruptcy situation in Australia at the moment? We all know that bankruptcies are increasing at an alarming rate. In my home State of Tasmania there were 93 bankruptcies for the year ended 30 June 1976; 95 in the year ended 30 June 1977; 148 in the year ended 30 June 1978, and up to 30 April this year there were 170. The same figures are repeated on the same sort of scale in all other States and the Northern Territory. More and more unsecured creditors and employees are being placed in jeopardy as businesses and firms collapse. The disadvantages and the hardships in the Government’s maintenance of this priority have been, I think, adequately outlined by Senator Missen. I can assure the Government that it is both traders and employees who are concerned to share equally with the community in the assets of the bankrupt or the insolvent. I can assure the Minister that the chambers of commerce and the trade unions in Tasmania, and no doubt in other States, have been equally supportive of this report and are anxious to see it implemented. What is surprising is that the Government has not really thought through the ill-effect of this continuing priority on commercial life and on relations between traders. It was pointed out in the report, as I recall it, that the fact that other creditors know that the Crown is going to take priority lessens their vigilence. They suspect that the Crown will swallow up all the meagre assets in its claim for taxation. Therefore, they become less vigilant and less pressing of their claims.
There is another factor which is of concern. Strangely enough, on an aeroplane a couple of months ago I was sitting next to a director of a company who had had experience of what I am about to speak of. Where the Crown, through the Commissioner of Taxation, waives its claims to press a particular tax debt, it creates an impression in the minds of other traders of quite a sound position of the company against which the Commissioner of Taxation has decided not to press the claim. In other words, a situation of grace on the part of the Commissioner of Taxation creates an impression on other persons within the community that the company or firm concerned is in quite good health. Apparently a good situation of liquidity is portray a bie by that employer and by that trader to his employees and to other traders. This can be quite misleading. This is another small matter which the Government just does not seem to have taken into account in its decision to maintain this dominance of the claims of taxation over other ordinary debts.
I will be seeking leave to continue my remarks in a moment in the hope that we can take up the matter at a later time. My remarks relates to the failure of the Government to maintain its promise to respond within six months of the laying down of these reports. It is a sad day when, 15 months after consideration by the Government of a unanimous and bipartisan Senate Committee report, the Minister comes into this chamber and tells the Parliament in a misleading way that it has adopted the spirit of the report but not the substance, or so little of it that I can assure honourable senators that those who are looking forward to relief, whether they be the small traders or employees represented through the chambers of commerce or trade unions, will be most vociferous in their rejection of the Government’s decision.
Normally, perhaps because of my nature, I seek to find even in government activity those things which are good in any measure, even though as a member of the Opposition one might be opposing the measure as a whole. But I can say that this decision by the Government is so vitiated by its refusal to accept the main contention of the report that one has to say that there is nothing good in the statement that the Minister has put down. Apparently the concessions were minimal and were only given because they were in harmony with the whole weight of bureaucracy advice. They are so minimal and marginal that the Opposition can concede nothing good in this response by the Government. We will certainly be supportive of those members around the chamber and in both Houses of Parliament who will seek to reverse that decision.
-I rise in this debate to support the remarks of my colleague from Victoria, Senator Missen, but I hope to do that from a short distance away, the distance being that I am not a member of the Senate Standing Committee on Constitutional and Legal Affairs, and I was not a member of that Committee at any time when it considered this matter. I think that as chairman of that Committee, and as the only continuing member of it, Senator Missen has been too close to the subject to see what really has been achieved. Also, unfortunately he was only today given a copy of the statement of the Attorney-General (Senator Durack). That is a most unfortunate state of affairs which will have to be rectified in some way in relation to future matters. Because of those factors he has been unable to see what has been achieved. I think he does his committee and the Government a slight injustice. As to the remarks of my colleague from Tasmania, he does the Government more than an injustice; he does the Senate an injustice because he says the abandonment of $5m of revenue by the Government is not worth anything. Frankly, I would have to say to Senator Tate that I would regard his remarks as absolute nonsense.
Unfortunately, there are areas in Australia where only relatively few people within a community are aware of the problems and injustices which arise as a result of the law. A matter which has been of great concern to me- as a senator from the area of Wannon, and living in country Victoria- is the problem of wandering stock. If a motorist in the middle of the night happens to drive into a beast that is wandering on the roads of Victoria and thereby does himself great damage, personally and perhaps to his motor vehicle, he will then discover a grave injustice in trying to recover some damages for the consequences of his accident. However, again that is an area where the public is unaware of an injustice and only the people who happen to run into a wandering beast and those practitioners who are involved in that area of the law discover the terrible injustice.
This is another area of the law where there has been an injustice which has existed for over 50 years. In relation to the priority of Crown debts, I am not sure when the Commonwealth Bankruptcy Act came into force. My investigations indicate that there was such an Act in 1 9 1 8 but I do not know whether there was one prior to 1918. That is over 60 years ago, and I have no doubt that within a very few years after that Act came into force the practitioners became aware of the injustice that was involved; of course, those practitioners who practised in State liquidation proceedings would have been aware of the injustices of Crown priority. So we have had these injustices for over half a century. On 21 April 1977- less than 2lA years ago- this Senate referred the problem to the Senate Standing Committee on Constitutional and Legal Affairs. On 2 June 1978- a little over 13 months later- that Standing Committee reported to the Senate. Today, on 13 September 1979-15 months later- the Government has reported that it has adopted the main thrust of that report. That means that in only 2’/5> years we have managed to rid ourselves very much of an injustice which has been in existence for over half a century. I say to Senator Missen, to his Committee and to this Senate that that is a remarkable achievement. I congratulate the Government.
There is also that part of the report which deals with pay-as-you-earn deductions, which the Goverment has not agreed to adopt. Senator Tate dismissed it out of hand and Senator Missen adopted the approach which I will adopt, which is that continuing pressure will be brought to bear on the Government in the hope that in due course it will find its way clear to change the law in relation to the PAYE deductions. One would have to point out that the consequence of the adoption of this report is to shift this burden of revenue loss from various people within the community to the taxpayers of Australia. The Government has to balance its priorities. It is very easy to come into a parliament and talk about cutting revenue and increasing expenditure. The Government hears that sort of nonsense spoken all the time by the Opposition. I have been disappointed to hear it repeated today by my colleague Senator Tate. On the other hand, the Government has to balance its revenue and its expenditure, and it has to weigh the various possibilities and probabilities.
On a particular occasion- such as in 1979- it may very well be that the Government decides that it cannot forgo an additional $5m revenue. The words are that it cannot forgo; but, in effect, honourable senators know that means that it cannot shift to the taxpayers of Australia an additional burden of $5m. There will be many taxpayers in Australia who will congratulate the Government because it has adopted a reasonable approach. In its Budget arrangements this year the Government has adopted a fair, sensible and reasonable approach. I say to the Senate that the Government has adopted a reasonable approach to this report. The Government has said that it will accept the report in principle. I agree with Senator Missen and I will support him strongly in the party room and in other areas with my lobbying in an attempt to persuade the Government in due course to adopt the whole of the report. But I suggest to the Senate that we crawl first; let us be satisfied that at this stage we have very much saved from a major injustice the people who are involved in these unfortunate proceedings. This has been the first step down the road. I think it is a great first step and I congratulate the Committee and the Government on adopting the report.
– If there are no other speakers I wish to take a few minutes to refer to something that is occupying my mind. I think this matter should be adjourned until another time to let honourable senators look at it. I have never been a supporter of Standing Committees, believing that their recommendations are pigeonholed on every occasion. Subsequently that idea was confronted by the notification that the Government would give notice of its intentions in regard to recommendations within six months. That was brought to an abrupt consideration yesterday when you, Mr President, tabled your document, which may have inspired the declaration of the Attorney-General (Senator Durack) today. Perhaps that declaration was hastily compiled and did not allow time for Senator Missen to see it.
Despite what Senator Lewis has said, and what has been said by Senator Missen and Senator Tate, here we have a case- although I am not an authority on it- where there has been almost a complete rejection of a committee’s recommendation. It is a committee which the Senate established with all confidence that it would explore the matter and, as a result of expert witnesses and hearing the best advice in the country, would come down with certain recommendations. In effect the Government has said that in the main it will not adopt them. What is the position of this Senate? Should we stand behind our Committee or should we let a government decide what it will do? As Senator Lewis has said, $5m may have to be obtained from somewhere else. Should we uphold the justice of the decision of the Committee, one in which we have confidence, and which made the decision on expert advice?
One would think that the Senate would stand behind the Committee. But the only opportunity today for us to stand behind the Committee will arise when we vote on the motion that the Senate take note of the Minister’s statement. If we adopt that motion, we do not say whether we support the Committee or the Government on this question. We will not indicate whether we should let the elected Parliament take control or whether, despite the extent to which we have gone in trying to fathom the justice of the matter, a government will override. the people’s elected representatives and state what it will do.
I think that this is the turning point of the Committee system. Should we simply wipe what the Committe said because of a government’s declaration? Of course, we will not resolve that situation simply by passing a motion that the Senate take note of the paper. That motion achieves nothing. It is the course that is always adopted but this is such a vital issue that something else must be done. I feel that we should add to the motion words to the effect that the Senate is of the opinion that the Government is negligent in not accepting the Committee’s report. It may not be effective for me to move such a motion because I am a back bench senator in an opposition party. Without having some discussion with my party colleagues, I feel unable to go further today. That is why I suggest that the matter should be adjourned.
I have tried to emphasise the importance of a decision on the Committee system. We have a Committee system to inquire into all the facts and receive expert evidence. Are we going to let it down by saying that, regardless of what a committee decides and regardless of what it costs to run, we will wipe aside its decision simply because of what the Government says? This will destroy our whole Committee system. Because we have two Houses I do not know how we can alter the Government’s decision. Senator Lewis, while apparently he is trying to protect the car drivers of Wannon, has not thought about the annual leave of workers. The Government wants to take its share before a worker gets his entitlement, something he has earned by the sweat of his brow. At that stage he may be a pensioner or may be on compensation and may not be able to get his benefits. I mention these considerations because the matter is too important just to move a motion that the Senate take note of the paper. This motion is not sufficient. I do not know how far Senator Missen is prepared to go or how energetically Senator Lewis is prepared to lobby to get a change of Government attitude. An adjournment of the debate may permit us to see the effectiveness of the capabilities of Senator Lewis at any rate.
Debate (on motion by Senator Guilfoyle) adjourned.
Motion (by Senator Missen) agreed to:
That the resumption of the debate be made an order of the day for the next day of sitting.
Motion (by Senator Guilfoyle) agreed to:
That leave be given to introduce a Bill for an Act to amend the Compensation (Commonwealth Government Employees) Act 1971.
Motion (by Senator Guilfoyle) agreed to:
That leave be given to introduce a Bill for an Act to amend the Seamen ‘s Compensation Act 1911.
Motion (by Senator Guilfoyle) agreed to:
That so much of the Standing Orders be suspended as would prevent the questions with regard to the several stages for the passage through the Senate of the Bills being put in one motion at each stage and the consideration of such Bills together in the Committee of the Whole.
Bills presented, and read a first time.
Standing Orders suspended.
– I move:
The main purpose of this Bill is to provide for increases in benefits payable under the Compensation (Commonwealth Government Employees) Act which provides workers compensation for employees of the Commonwealth Government and its statutory authorities. This legislation was last amended for this purpose during the 1976 Budget Session of the Parliament. Since then there have been significant increases in the cost of living and in the benefits payable under the workers compensation legislation in New South Wales, Western Australia, Tasmania and Queensland, while legislation is pending in Victoria. It is therefore necessary that the benefits under the Compensation (Commonwealth Government Employees) Act should be increased.
Compensation for Total Incapacity
Employees who have been injured in activities connected with their work are entitled to receive weekly compensation payments equal to their normal full sick pay rate during the first 26 weeks of total incapacity for work. For long term cases, where total incapacity has exceeded 26 weeks, the compensation is based on fixed weekly rates that are specified in the Act. Under the Bill, the fixed weekly rate for a totally incapacitated employee without dependants will increase from $80 to $90. The additional weekly supplement for a dependent spouse will increase from $2 1 to $23.60 and the weekly supplement for each dependent child will increase from $ 10 to $ 1 1 .25.
Compensation for Partial Incapacity
A similar increase, from $80 to $90 a week, will also apply to the ceiling which operates in relation to the compensation payable for partial incapacity for work.
Compensation for Death
The Bill also provides for increases in the amounts of compensation payable where an injury results in the death of an employee. The basic lump sum payable to dependants will increase from $25,000 to $28,000. The weekly amount payable in respect of each dependent child of a deceased employee will increase from $10 to $11.25 and the minimum total amount payable for each child will increase from $1,000 to $1,125. The maximum amount payable in respect of funeral expenses will increase from $650 to $730.
Compensation for Specified Losses
The lump sums payable under the Act for specified losses will also increase. The maximum lump sum payment for such a loss will increase from $25,000 to $28,000 and the lump sums for the less serious losses will increase in the same proportion. For example, payments for severe and permanent facial disfigurement will increase from $12,500 to $14,000 and compensation for loss of the sense of taste or smell will increase from $2,500 to $2,800.
The maximum amount payable for alterations to buildings or vehicles, or repair or replacement of certain aids and appliances, will go up from $700 to $780. However, clause 7 of the Bill will allow the Commissioner for Employees Compensation to approve payments beyond this limit where he is satisfied that the circumstances of the case would justify an increased payment.
The opportunity has also been taken to make other amendments of a relatively minor nature. The first of these, in clause 3 of the Bill, increases the upper age limit for a dependent student child from 21 years to 25 years, standardising the definition of a student child in Commonwealth compensation legislation with that applicable under the Social Services Act.
The amendments in clauses 4 and 5 will clarify the application of offsetting provisions of the principal Act to employees of Commonwealth authorities and of the Northern Territory Administration where invalid pensions are payable for the same injury. Clauses 6 and 9 are consequential upon changes in other legislation referred to in the principal Act.
Clause 8 will allow partial invalidity superannuation pensions to be taken into account in calculating compensation entitlements. The amendments in clauses 10, 1 1, 12 and 13 will facilitate handling of requests for reference to a compensation tribunal for reconsideration of a compensation determination. The amendment in clause 14 is consequent on the amendments in clause 15, which provides for references of questions of law from a compensation tribunal or a prescribed court to the Federal Court of Australia.
Application of Amendments
The Bill provides that the increases in monetary benefits come into operation on 1 September 1 979. All other amendments will come into operation on the day the Act receives the royal assent. The Bill also contains the usual provisions for the increased weekly payments to apply from 1 September 1 979, notwithstanding that the payments relate to an injury sustained before that date. The increased lump sums for death and specified losses will also apply from 1 September 1979 in all cases where the death occurs or the loss is suffered after that date, even though the death or loss may have resulted from an injury sustained before that date. Increases in other benefits will apply in a similar way.
Cost of Increased Benefits
The total cost of the increased benefits authorised by the Bill is estimated to exceed $lm in a full year. I commend the Bill to the Senate.
The main purpose of this Bill is to increase the rates and amounts of compensation payable under the Seamen’s Compensation Act to seamen and their dependants. The Bill will ensure that the monetary rates payable under the Act are kept in line with those contained in the Compensation (Commonwealth Government Employees) Amendment Bill 1979. I should mention, however, that the proposed amendments will not involve any cost to the Commonwealth Government as payments under the Seamen’s Compensation Act are the responsibility of the shipowners.
Under clause 4 of the Bill the weekly compensation for total incapacity for work is to be increased from $80 to $90 for a seaman without dependants. The additional weekly supplement for a dependent wife will be increased from $2 1 to $23.60 and that for each dependent child from $10 to $1 1.25. The ceiling which applies in certain circumstances in relation to the weekly payments for partial incapacity is also to be increased from $80 to $90. In addition to the increases in weekly incapacity payments, the Bill provides for the lump sum death benefit, to which the lump sum benefits for specified injuries and maximum compensation are related, to be increased from $25,000 to $28,000. The weekly payment in respect of each dependent child of a deceased seaman will be increased from $10 to $11.25 and the minimum total amount payable for each child will increase from $1,000 to $1,125. The maximum amount payable in respect of funeral expenses will increase from $650 to $730.
The opportunity has also been taken in clause 3 to make other amendments of a relatively minor nature. The first of these is in response to representations from the parties to the Maritime Industry Seagoing Award 1975 and operates to prevent the application of offsetting provisions of the principal Act to make-up pay provided by virtue of that agreement. A further amendment in clause 3 increases the upper age limit for a dependent student child from 21 years to 25 years. This is in line with a similar amendment to the Compensation (Commonwealth Government
Employees) Amendment Bill 1979 and will standardise the definition of ‘child’ in Commonwealth compensation legislation with that applicable under the Social Services Act.
Application of Amendments
The Bill provides for the increases in monetary benefits to come into operation from I September 1979. The other amendments will come into operation on the day the Act receives the royal assent. The Bill also contains the usual provisions for the increased weekly payments to apply from 1 September 1979, notwithstanding that the payments relate to an injury sustained before that date. The increased lump sums for death and specified losses will also apply from 1 September 1979 in all cases where the death occurs or the loss is suffered after that date, even though the death or loss may have resulted from an injury sustained before that date. The increases in other benefits will apply in a similar way. I commend the Bill to the Senate.
Debate (on motion by Senator Button) adjourned.
– I have received a letter from the Leader of the Government in the Senate, Senator Carrick, advising that Senator Thomas has requested to be discharged from Estimates Committee F and nominating Senator Withers to be a member of the. Committee. I have also received a letter from the Leader of the Opposition in the Senate, Senator Wriedt, advising that Senator McLaren has requested to be discharged from Estimates Committee A and Senator Sibraa from Estimates Committee F and nominating Senator Sibraa to be a member of Estimates Committee A and Senator McAuliffe to be a member of Estimates Committee F.
Motion (by Senator Webster)- by leaveagreed to:
Estimates Committee A-Senator McLaren
Estimates Committee F- Senator McAuliffe and Senator Withers.
– by leave- I remind honourable senators that, in accordance with the program which has been circulated, at approximately 4 p.m. on Tuesday next, 1 8 September 1979, the sitting of the Senate will be suspended to permit Estimates Committees A, B and C to meet. Committee A will meet in the Senate chamber, Committee B in Senate Committee Room No. 1 , and Committee C in Senate Committee Room No. 6.
Debate resumed from 28 March, on motion by Senator Durack:
That the Bill be now read a second time.
-The Bill before the Senate relates to an agreement between the Commonwealth and Tasmania in connection with the development of Tasmanian native forests. Agreement has been reached to devise a program which will assist in ensuring the supply of raw materials for future forest products and contribute to long term development in Tasmania. It is stated in the second reading speech of the Attorney-General (Senator Durack) that the implementation of this program will assist in alleviating the current employment situation in that State. The provision of $136,000 a year for five years will make an infinitesimal contribution towards relieving unemployment in the State of Tasmania. With a little mental arithmetic, it can be proved that 30 married people on the dole would be paid the equivalent of this grant by the Commonwealth Government. The problem confronting the forestry industry in Tasmania in relation to the amount provided by this legislaton highlights the attitude of the Government to two important matters in Tasmania, the future of our forests and the unemployment problem.
One of the main things, as I see the situation in Tasmania, is the need for research into the whole matter of eucalypt forestry. At the beginning of the century the harvesting of our natural forest was indiscriminate. The sawmillers went through the forests and chose and took out the most suitable logs. They actually scavanged the forests for the best material and left the lesser quality timber. The Forestry Commission in Tasmania, and previously the forestry department, has tried to come to grips with this very great problem of continuity in the supply of this most valuable asset. The Tasmanian eucalypt is claimed to be one of the finest timbers in the world. I refer to the eucalyptus regnans, the stringy bark and the honey coloured hardwood that is described as Tasmanian oak and which is sought after and has a great market in most places throughout the Western world. Yet it has been predicted that the supplies could be limited to a period of less than 20 or 30 years in the future. The report of the Inquiry into the Structure of Industry and the Employment Situation in Tasmania headed by Sir Bede Callaghan is very interesting. It draws attention to one of the recommendations received from the Tasmanian Timber Association. The recommendation stated:
That the Commonwealth should make available to the State sufficient funds to permit the Forestry Commission to develop an adequate program of hardwood regeneration. It was claimed that softwood planting had been well catered for and that the future of the Tasmanian timber industry rests with hardwood.
Another recommendation was:
That the Division of Forest Products of CSIRO be reestablished in Tasmania.
This is one of the matters that, I believe, should be the subject of this legislation. The Division of Forest Products should undertake an overall survey of the forestry situation in Tasmania. The report draws attention to the need for further research into Australian forestry generally. It is of great and urgent importance that this type of research be carried out in the Tasmanian forests. The problem in Tasmania is different from that on the mainland. I refer to the matter of regeneration. In warmer States a good natural regeneration occurs but Tasmania, although it grows splendid timber under natural conditions, has a colder climate and therefore there is a greater risk that land can drop out of production unless seeding is done after burning off.
The matter of seeding must receive much more emphasis. Traditionally foresters have relied on the haphazard method of natural regeneration. The different climatic conditions of Tasmania are adverse to the efficient regeneration of our particular eucalypts. Mention is made in the provisions of this legislation of the thinning of blackwood forests. There is no doubt that forests in the very wet areas of Tasmania get very luscious regrowth of blackwood and wattle, but there is a greater need, in my view, for specialisation with the eucalypt. Despite the fact that blackwood is a beautiful timber and much sought after- finance should be diverted to the regeneration and the scientific husbanding of our blackwood forestsmore emphasis must be given in this legislation towards the great problem that has never been really tackled in Tasmania. I refer to the special climatic conditions and the relative difficulty of regeneration without the assistance of planned seeding.
We have a further problem in Tasmania. Approximately half the forest area of Tasmania is Crown land and the other half is private property. The growing of eucalypts is such a long range plan that people with private property are loath to make the necessary investment and to undertake the long range planning that is necessary to successfully regenerate eucalypts. No mention is made in this legislation about making funds available for private land reafforestation. Some incentive has to be provided in some way or other for all our marginal forest land to be surveyed in regard to the future continuation of this industry. Periodical burning off for grass regrowth does not provide the ideal environment for timber regeneration. This aspect must be given closer consideration. Of course, there is no easy answer. The provision of $136,000 per year for five years is only scratching the surface. The contribution that Tasmania makes to the overall national income proportionately is a considerable amount when we take account of its size and population.
A large proportion of the total production of the forestry industry is exported. The various aspects of forestry- the logging, plywood and wood chip industries and so many other byproductsare basic dollar earners. This industry in turn can help perhaps more than any other industry- because it is a regenerating and continuing process like our tourist attractions in Tasmania- to maintain a high and rising standard of living in our State. Unlike mining, which is a finite industry, where there are deposits which have been worked out and all that is left is a hole in the ground and some bankrupt shareholders, the forestry industry will provide a continuing process, if those responsible can see far enough ahead to plan for regeneration of the sort which will be effective for the generations which will follow us. After all, we have had the good fortune to inherit some magnificent forests in this continent, particularly in Tasmania, and there is a very heavy responsibility on this generation, now that we can see the limits of availability of good quality timber, for us to do something much more positive than is contained in this legislation. 1 am being critical to this extent. I know the difficulties which are present in the economy.
I started off by mentioning the amount that is available in this loan, and that is virtually what it is. After 20 years it will accumulate interest which will make repayment much more difficult, because the expectation of a dividend from regeneration of eucalypts covers a period of 50-plus years. Therefore in the interim period after the interest starts to accrue on this amount it will place a burden on the people of Tasmania until there is logging.
My contribution today is to draw the attention of the Senate to the fact that in my opinion not nearly enough emphasis is being placed on the level of national policy for this tremendous investment that we have, especially in Tasmania where our resources, although they are rich, are limited. This is one area which is not only creating employment opportunities but is also a valuable means of balancing our trade and making a contribution towards the economy. Timber is one of the greatest gifts that man has. Substitutes can be found for most things, but timber is a thing of beauty, whether it is in furniture or the other by-products which come from the forests, and it is something that should be constantly in our minds as one of our greatest assets.
Although I have been critical, the Opposition does not oppose this legislation. We hope it will have a speedy passage, although it has been before the Senate for a considerable time. I do not think the funds available will be sufficient to cover in a planned way the regeneration that should be going on, but the idea is being commenced here. I hope success lies ahead for the people who will be responsible for its implementation, and particularly for the Commonwealth Scientific and Industrial Research Organisation in its research into the whole problem in Tasmania. It has not been done properly in the past. But both State and Federal governments are not directing their attention to the need for planned regeneration. In doing this the Governments will be fulfilling a responsibility that the generations that follow us in this country will expect of us. That is the least they could expect of us. I hope that the Government will see fit to have another look at this very important matter and will be much more generous in its approach to the application of government funds for the regeneration of eucalypts in Tasmania.
– The Senate is debating the Tasmanian Native Forestry Agreement Bill 1979. If that Bill becomes law it will authorise the execution of an agreement between the Commonwealth and the State of Tasmania as set out in the schedule to the Bill. I am not here to canvass that particular agreement. That is an agreement which was worked out between the State of Tasmania and the Commonwealth. I will be supporting the legislation, but I will do so with some reservations and some suggestions.
The main purpose of the Bill is to authorise the execution of an agreement between the Commonwealth and the State and to enable the flow of the amount of money per year for a period of five years for a forestry program to ensure that raw materials are available to future forest products industries. I think that the amount of $ 1 36,000 per year for the initial year commencing 1 July 1 978 is niggardly. But as I say, I do not want to canvass the terms of the agreement. I do want to draw the attention of the Senate to the fact that this arises out of one of the recommendations by Sir Bede Callaghan in his report ‘Inquiry into the Structure of Industry and the Employment Situation in Tasmania’. On page 121 of that report Sir Bede Callaghan had this to say:
In the preceding paragraph but one, I mentioned reafforestation. Earlier, reference was made to a submission by the Tasmanian Timber Association to the effect that there is a need fora program of hardwood regeneration.
I am not a forester but general knowledge suggests Australia, and particularly Tasmania, may be in a most promising position if appropriate action is taken now. That is to say, world prospects some decades ahead are such as to warrant, as I understand the situation, the closest study of action in Tasmania with a view to ensuring a suitable supply of hardwood in due course.
This Bill is a first attempt to implement that proposal. As I mentioned before, it is to initiate a program or ensure that there will be Commonwealth funding for a program for native forestries to assist in ensuring the supply of raw materials to future forest products industries.
Much has been said, including something last night by Senator Knight on the adjournment debate, about the possibility of the transfer of the Division of Forest Research of the CSIRO from Canberra to Tasmania. Personally, I would welcome that transfer. However, I do not wish to go into that today because I believe that will be dealt with by the inquiry that is currently being undertaken by Professor Pryor. Tasmania is represented on that inquiry. Nevertheless, I do believe that, at least at this point in time, there is an urgent need to develop and to reinforce the branch- the very small branch- of the Division of Forest Research of the CSIRO which is now in Tasmania, pending the outcome of that inquiry. I leave that aside.
I believe that a very important project would be the re-establishment of the Division of Forest Products of the CSIRO. That would be of major benefit to Tasmania. After all, what are we talking about? We are talking about the need to service forest products- structural timber, decorative hardwood and softwood, pulp, fine writing paper, newsprint, particle board, hardboard, plywood and wood chips for export. Tasmanian timber is amongst the best in the world but, as was pointed out by the Tasmanian Timber Association, both to the Callaghan inquiry and to the Birch inquiry, Tasmanian timber is amongst the most difficult to season. I ask the Minister for Science (Senator Webster) to give urgent consideration to the proposition that the Division of Forest Products should be reestablished within the CSIRO and should be sited in Tasmania. Of course, that is quite a different matter from the one raised last night.
As the Senate would know, until 1973 there was an excellent relationship with the old Division of Forest Products, as it was known then. In 1973, for reasons which escape me, that division was abolished. Its functions were supposed to have been taken over by the Division of Building Research and by the Division of Chemical Technology, both located in Melbourne. My advice is that at least the sawmilling section of the timber industry, not just in Tasmania but in the whole of Australia, is not being well served as a result of the abolition of the Division of Forest Products. Indeed, the general viewpoint amongst the whole of the industry is that it would be better served now if the Division of Forest Products were re-established and that, because of the circumstances within Tasmania, it was sited in that State. I draw the Minister’s attention to the following statement which appears at page 81 of the report of the Independent Inquiry into the Commonwealth Scientific and Industrial Research Organisation, the Birch inquiry:
The situation in Tasmania merits special mention. We formed the opinion that present arrangements are unsatisfactory from a number of standpoints, including internal CSIRO communications and a lack of focus in the rather fragmented research activities there.
I stress the words ‘a lack of focus in the rather fragmented research activities there’. The report continued:
We note the submissions from the forest products industry and that forest products encompass Tasmania ‘s largest secondary industries. We believe that consideration should be given to the relocation of forest and related research activities as a Division to Tasmania, as a means of alleviating the major problems experienced by CSIRO there and permitting the organised development of a broad range of CSIRO activities in that State.
I consider that the re-establishment of the Division of Forest Products and its location in Tasmania would be welcomed within both the CSIRO and the whole of the industry. It goes without saying that certainly it would be a most welcome step for the Government to take as far as my State of Tasmania is concerned. I support the legislation.
-I support the Tasmanian Native Forestry Agreement Bill. I will not go into great detail in my remarks because the matter has been covered very adequately by other speakers, but I do wish to associate myself with the legislation. Tasmania depends very heavily on the timber and timber-based industries. They are very important to the State. Senator Harradine has spoken adequately on the research aspects. I support what he said. At the present time inadequate provision is made for research on timber throughout Australia. I believe that, with the excellent timber growing conditions which exist in Tasmania for both softwoods and hardwoods, certainly it is an appropriate place for a timber research centre dealing with the growth and treatment of timber to be located.
In Tasmania the timber industry covers the whole of the State. It is a very great stabilising force in a non-urban State. The three great companies, Associated Pulp and Paper Mills Ltd, Australian Paper Manufacturers Ltd and Australian Newsprint Mills Ltd, are all very significant contributors to the economy of the island. The timber industry is a traditional industry. It really had its first major boom at the time of the Victorian gold rush. As a result the industry spread throughout the whole of the island and continues to do so. It is going through a period of reorganisation, like any of the older, established, traditional industries. Regrettably, often the changes are not taken very easily. There are always casualties in re-organisation and, regrettably, there will need to be a shake-up of the operators until the greatest efficiency can be achieved.
This legislation, as part of the Callaghan packet, is appreciated very much by all thinking Tasmanians. It provides more evidence of the tie-up which exists between the Tasmanian Government and the Federal Government on matters affecting Tasmania. Last year, when we debated the allocation of funds for softwoods, I questioned the extent of that funding. I still believe that it was a reasonable proposition then to consider the different nature of softwoods and hardwoods and the extent to which different States need to participate. Of course, Tasmania has needs related to issues other than softwoods, as is demonstrated by this legislation. So do the other States. They have a variety of needs. At present Tasmania’s greatest need is in the area of regenerating areas of hardwood forests. The main purpose of the funding which is the subject of this legislation is the regeneration of forest areas which have suffered devastating fires twice since 1967. The first fire was the major Tasmanian fire and this was followed about three years ago by another one which eliminated the regenerated areas around the south of Hobart and Geeveston. To date this funding has been used for that purpose. I have been into that area and have had a look at the position. With other members of the Senate Standing Committee on Trade and Commerce I made an inspection of the area and talked with all the people who are involved. We met with the Tasmanian forestry officers and the representatives of all the major companies, and I think it would be only right that I should say that the Committee was terrifically impressed by the depth and strength of the officers of the Tasmanian Forestry Department. We thank them very much for the courtesies with which they provided us and the excellent manner in which they demonstrated what they are doing. I think it is only appropriate that I should place that on the public record.
The timber industry has changed much as a result of the changes in the national economy since I was elected to this place at the beginning of 1 976. The industry was then in a fairly rundown state. The timber processing industries were in a like state. Everything from the paper and pulp industries through to the furniture manufacturing and house building industries was in a very sorry state. In common with many other industries the timber industry was probably particularly affected. In those days the paper mill in Burnie was in a declining state, the plywood mill at Somerset was operating at about half capacity and a great number of sawmills were operating less and less. The improvement in the economy and in the value of the Australian currency to a reasonable world parity level, coupled with the Tasmanian freight equalisation scheme, helped the industry to pick up tremendously. At present I think it is fair to say that the majority of the timber and timber-based industries are on an improving scale. As the result of the intention of, particularly, Australian Pulp and Paper Mill Ltd. to improve and extend its works it appears that the timber industries will regain the importance that they had. I hope that some of this money for special purposes will be used for an investigation into what are called the minor species- the indigenous pines, including the king billy pine, the huon pine and the celery top pine, and the myrtle, the sassafras and the blackwood- which are special timbers for special purposes. The terms of this legislation are certainly most favourable. I believe that anyone in Tasmania would appreciate the specially favourable terms which have been granted to the State. As a Tasmanian I would like to express my appreciation.
Tasmania still has a changing economy. If we look back some 30 years, I suppose, we will find that the economy of Tasmania was built around dairying, apples, potatoes, wool, textiles, minerals and timber. So many of those industries have suffered the ravages of freight costs and changes of various sorts that I believe that in the 1980s we will have to look to an economy which is built around tourism, modern mining of various sorts, timber, the processing of timber and timber products, some improved primary industry, wherever possible, and, I hope, various craft industries. The latter, of course, will involve some use of these special timbers. I believe that the population of Tasmania is unlikely to change much in the next 10 to 15 years. I believe that commercial development will be fairly slow and will be centred on the couple of areas that I have mentioned. This makes concentration on these special items even more important. Accordingly, I support the legislation.
– This Bill is important for Tasmania because it deals with one of the most important renewable and exploitable resources in that State. It is important also because it illustrates that the present Budget of this Government is largely a juggling of figures to suit electoral purposes. Most honourable senators will recall that this Bill was introduced on 28 March of this year and has not been debated since then. The Government failed to gain the passage of this Bill through the Senate prior to our rising for the winter recess. So it was with some surprise that I read in the Budget Speech of the Treasurer (Mr Howard) that the Tasmanian Native Forestry Agreement Bill, which we are now debating, was presented allegedly as a new initiative in the current financial year for the advantage of Tasmania. Of course, it is nothing of the sort. The Government is attempting to window-dress its neglect of Tasmania by making this Bill appear to be a new initiative in this Budget year. People who are involved with the Tasmanian forestry industry will recognise the inconvenience and the delay which have been caused by the failure of the Minister for Primary Industry ( Mr Sinclair)and his representative in the Senate must have some responsibility- to have the Bill passed during the last session.
The Young Committee and the Callaghan Committee of Inquiry into the Structure of Industry and the Employment Situation in Tasmania saw forestry as a very important part of Tasmania’s economy. Whilst there may be economic and physical restrictions on the development of softwood plantations, it seems as though the scope for native forest development is quite considerable. For some time the Tasmanian Government has been urging the Australian Government to take an active interest in the expansion of native forests. The results in the short run may be limited, but after seven or eight years, or thereabouts, the harvesting of these young native forests will add particularly to the woodchip resources of the State. Logging and processing of the products involve considerable employment opportunities. The joint Commonwealth-States study group into the processing of raw materials in Australia has shown that there is considerable scope for expanding those opportunities.
The Federal Government has claimed that the passage of this legislation, which we are not opposing- Senator Harradine indicated that he also is not opposing it but has reservations- will positively help the Tasmanian industry. This is true, but only to a limited extent. The history of the legislation is a protracted argument between the two governments, the Federal Government and the Tasmanian Government. The Tasmanian Government sought the maximum assistance from this Government because its resources are limited, but it recognised that Australian Government employment and revenue would benefit if the industry could be expanded. Because of the long period for the product to grow to maturity the State Government sought interest and capital repayment holidays. It asked that there be a 20-year moratorium on interest and capital repayments with interest and capital being repaid after that period. This would have been similar to other agreements which the Australian Government has concluded. As I understand, under the terms of this agreement there will be a deferment of interest, not a moratorium. Under the terms of the agreement over the 20 years the State Government will have to pay $5.40 interest for each $ 1 borrowed and $6.40 for each $ 1 of capital borrowed after that.
– It is not even as good as the softwood agreement.
– I think that that is correct. That is why I have already alerted the Minister for Science and the Environment (Senator
Webster) to the fact that I certainly will be seeking clarification of this point. What appears to be a generous agreement requires, as I read it, that the Tasmania Government will be obliged to repay over the entire period $1 1.80 for every $1 that has been borrowed. I find it very hard to believe that that can be termed a generous deal. No doubt we will get a reply on that from the Minister and will be able to discuss it, if need be, in the Committee stage.
The Tasmanian Government is not disguising the fact that it needs additional funds for forestry work. The available sources within Tasmania are strictly limited and any help from outside is welcome, but the terms and conditions offered by the Federal Government do not appear to be as generous as one would expect. In fact, I think that they could be described as harsh. It is an indication that the Minister for Primary Industry and his colleague the Minister for National Development (Mr Newman) do not really understand the structure of the forestry industry in that State. It is not one which produces a cash flow two or three years after trees have been planted. After the initial seven or eight years there would probably be a limited return, but that would not meet the cash outflow for development and planting costs. It is not until a native forest reaches maturity that it is capable of even looking like making profits. But the Federal Government is engaged in a continual quest for increased revenue and is prepared to explore almost any avenue in that regard.
The agreement has been accepted by the Tasmanian Government because no other source of finance is available to it. The private sector, about which the Federal Government speaks so glibly at times, really has not the incentive to undertake this sort of forestry investment. The trading stock valuation adjustment scheme has been brought to an end by this Government and other incentives which have been available to forestry, and the primary industry sector generally, have also been removed. That is not to say that we, as an Opposition, necessarily agree with those incentives. Over the longer run there is a tendency in some industries to create a false picture of market conditions. Nevertheless, the present Fraser Government had claimed that it would continue incentives of the kind expected by the private forestry sector. The consequence of the Prime Minister (Mr Malcolm Fraser) breaking so many promises has been a reluctance on the part of industry to undertake longer term investment. There is certainly not an incentive of the kind which exists in, for example, New Zealand and the United Kingdom.
We in Tasmania are concerned about a number of matters which I shall indicate because it is important that they should be stated. There is a degree of cynicism about the Government’s now bringing on this Bill, which was on the Notice Paper at the end of the last session but which the Government failed to bring down and have passed before the winter recess. It is quite wrong now to claim that it is a new piece of legislation. We are concerned also at the Government’s promising funds that were already committed to Tasmania. We are concerned about the level of interest repayments. We are concerned that there has been a failure to meet the request of the Tasmanian Government to provide up to $10m for larger native forest development. We are concerned also about the reduction of payments to the State under special purpose grants, which indicates that the Government is not being completely forthright in regard to the overall assistance that it is providing to Tasmania.
We do not oppose the Bill. It does have advantages. The Tasmanian Government does recognise that if it did not agree to the Bill it would probably receive less or perhaps even not be able to proceed at all. It is a great pity that the present Federal Government cannot see the longer term implications for the smallest and economically probably the weakest State in the Commonwealth. I trust that the Minister during the course of his remarks, will be able to give us some clarification, particularly on the matter of the true cost to the Tasmanian Government under these arrangements.
-Until Senator Wriedt rose I had intended to say that the honourable senators who were addressing themselves to this Bill were almost unanimous in their consent to it. On the other hand, my colleague Senator Wriedt has expressed agreement with its general tenor. The Tasmanian Native Foresty Agreement Bill is particularly important to Tasmania because forests cover 43 per cent of the State’s land mass, compared with less than 6 per cent of forest area for Australia as a whole. These forests provide the State with more than 20 per cent of its primary production revenue. The industry, and its associated activities, employs in excess of 10,000 people. It provides 75 per cent of Australia’s pulp and contributes 29 per cent of Australia’s forest exports. These few but important statistics indicate the significance of the industry to the economy of the island. Therefore it is very worthy of the proposed transfer to Tasmania of the CSIRO Division of Forest Research. I welcome the Government’s consideration of that matter, support the initiative and hope that such a transfer can be made expeditiously. At the same time, I would welcome the re-establishment in the Commonwealth Scientific and Industrial Research Organisation of the Division of Forest Products. I trust that it too can be located in Tasmania.
The Australian Government has a number of responsibilities in relation to forestry. These include education, research, control of the exportation of wood chips, and financial assistance to the States in regard to softwood forestry plantings. The Bill is quite unique in that it is the first piece of legislation which has given assistance to any State in respect of native forests. It is also significant because it is the first tangible evidence, in legislative form, of the Callaghan 10-point plan for Tasmania. The Budget pronouncements give further proof of the special recognition by the Commonwealth of the difficulties that are faced in Tasmania.
This forestry project, as such, would not on its own be of momentous value to the State. I trust that it is merely the beginning of a co-operative, co-ordinated approach to forestry between the Commonwealth on the one hand and the States on the other. I agree that it could have been a better agreement. For example, although the repayment period of the loan is not unreasonable, I acknowledge that the method of calculating the interest falls far short of what was provided under the softwood forestry agreement. Therefore, if the forthcoming Callaghan proposals, in legislative form, are to have a major impact on the State, to offset the acknowledged disadvantages that it suffers when compared with the rest of Australia, it would be desirable, if practicable, to have a greater degree of Commonwealth substance in future agreements. If the State does not put forward major proposals to the Commonwealth, one can hardly blame the Commonwealth for waiting for such projects to come to hand. However, as Tasmanians, I think we must show a sense of responsibility to ensure that schemes put before this chamber have an economic or social basis.
The 2,750 hectares of eucalypt plantation on former farmland together with a thinning of blackwood regeneration in the north west, the reafforestation, and the planting of eucalypt forests along the west coast region with $ 136,000 in loan funds in real terms on a dollar for dollar basis with the State for each of five years. This could not be considered an imaginative or a large project. I feel that many other schemes of a similar nature will follow provided that we can get a better communication process between the Federal Government, the Tasmanian Premier and his Ministers. I acknowledge that there were no payments last year due to the delay in passing the Bill through this Senate and that payments will commence in 1979-80 with a sum of $272,000. Also, Mr Howard in his Budget Speech stated that further loan funds of $100,000 per year for the next four years on a dollar for dollar basis would be made to the State to establish eucalypt plantations on marginal farmland and for the purchase of such farmland. I mention that the wood chip industry is increasingly important and significant to the State. The wood chip industry involves the felling of the trees and a mechanical reduction of the wood to a chip the size of something between a 20c and a 50c coin. The first commercial shipment of chips from Australia took place from Eden in New South Wales in 1970. This marked the birth of the wood chip industry in Australia. Although it has brought benefits it has also brought a number of fundamental environmental problems. Since that time we have seen three company operations established in Tasmania; one on the east coast at Triabunna and the other two on the River Tamar in the north of the State. There is a further project in Western Australia and this draws its supplies from Manjimup. The chips are taken from all five areas in specially built and owned Japanese bulk carriers. Whilst the operation is of tremendous commercial value- I emphasise the word tremendous- to the Japanese and to the wood chip companies, the primary producer here in Australia is getting a mere pittance in royalty payment. Incidentally, I believe that the Eden project is wholly Japanese owned. As an example of the rip-off that is going on not only with the Japanese but also with the major wood chip companies, I cite a recent example from my State of Tasmania where Tasmanian Pulp and Forest Holdings has been the subject of a takeover. A rival company offered $15m to this company which, incidentally, has been operating for approximately 10 years. Further investigations showed that that valuation was slightly unrealistic. Within approximately a fortnight a revised offer of $25m was made. Another rival company, Associated Pulp and Paper Mills Ltd then entered the bidding fray. The final settlement, I believe, was over $30m which was twice the initial offer price. This gives some indication of the rate of profitability within this industry. This must be contrasted with the very low returns that are being paid to the primary producers who sell their logs to these wood-chip companies.
I also remind honourable senators that the Japanese are beginning to tighten the screws. At least one company has given notice to the producers on the quality of the chips, refusing to take any dry timber, and it does not want any rot in the logs. As honourable senators will know, if they are timber men, there is often a lot of rot in eucalypt timber. I therefore believe that we need to investigate at a Federal level the Japanese supply situation and provide the State forest services with adequate information on a price structure. Then if prices allow, which I believe they will, future export licences which are governed by the Commonwealth could contain conditions for increased royalty payments, especially to the private land owners. During the early establishment days of this chip industry, the primary producers were assured that the small limb logs and what is known as billet wood could be utilised and that mobile forest chippers would make it possible to convert what is known as the limb wood into the chips. This type of operation has proved uneconomic and the mobile forest chipping operations unfortunately have now ceased. The wood chip companies, therefore, are not getting rid of what we might term the so-called rubbish or the small diameter timber as promised in the earlier days. On the other hand, there is continued pressure by these companies for the replacement of timber.
The quality of the timber which is extracted from some parts of the State for the chipping is of an exceptionally high quality. This leaves the local sawmilling companies and the environmentalists somewhat annoyed, for the wood chip operators are forcing the traditional timber milling companies, particularly the smaller operators, into the more remote areas because of scarcity of material from their traditional sources of supply, thereby adding greatly to this cost at a time of economic downturn for the timber industry. I reiterate the point that the major Tasmanian sawmilling companies have been rather critical of the generous forest concessions that have been legislated to the pulp and paper combines which are capital intensive and publicly owned. The future State concessions must ensure that there is a satisfactory balance between the sawmilling and the forest company interests, because I believe that forests which are properly managed are a renewable resource. Within a relatively short space of time they can again provide almost all the forest benefits, particularly the public owned forest areas of the wood chip concessions which are not destroyed during harvesting but are subsequently regenerated and protected from fire. This is not the case, unfortunately, with most privately owned forests.
The granting of long term pulp wood- rights in Tasmania is conditional upon the construction of pulp mills, if feasibility studies justify the projects. It is now, unfortunately, abundantly clear that these pulp mills for export pulp are not an economic proposition, certainly in the short to the medium term. The pulp mills often provide no more employment than woodchip export plants. What is known as the Weseley Vale Act is designed to encourage the establishment of not only pulp mills but also paper mills because it is the paper mills that are the bigger employers of labour. This is what we should be emphasising now with high unemployment. Ultimate power rests with the Commonwealth, which can refuse to grant an export approval for woodchips. On the other hand, the State governments control and allocate publicly owned areas to the woodchip companies. The conservationists are concerned that there are few State government controls over private forests.
However, I understand that preliminary investigations are taking place in Tasmania into what is known as a Forest practices Act, which will provide minimum standards for all forest operations such as logging and regeneration in order to protect the forests and forest owners. I believe that it is most appropriate that Tasmania should take this positive and forward step to protect its forests and forest based industries to ensure that there is proper management of this most important resource. Firstly, the returns to primary producers must be improved to ensure that there is an adequate interest in the replanting and regeneration of trees. At the moment the extraction rates far exceed regeneration. Secondly, as I have mentioned, there must be a tighter environmental control and a higher density regrowth requirement by the Commonwealth when it assesses the regeneration requirements to meet the export licence needs; in other words, the standards demanded by the Commonwealth are not high enough in relation to regeneration density requirements. Thirdly, there must be realistic government royalties which should at least offset relevant Forestry Commission costs. It is a matter of some concern to Tasmania that the proposed Tasmanian inquiry on forestry royalties was quashed under pressure from vested interests. Fourthly, I believe there is a need for the setting up of a diploma in forestry at the Tasmanian College of Advanced Education. I believe it could be incorporated as part of the Callaghan plan for Tasmania. This would ensure that people who entered the industry had skills appropriate for proper use with forest resources. The need is there, the numbers warrant such a course and all would be aware of the long term benefits that would result.
Lastly, the tax laws need to be changed to encourage primary producers to adopt proper management practices. In Tasmania especially, because of the importance of forestry operations to the State, the economy is unduly penalised by the outmoded Income Tax Assessment Act under which we are operating at the moment. The State government has followed very closely the recommendations of an excellent report prepared by Merv Everett, Q.C., and Dr Gentle from New South Wales. The State government set up a private forestry division within the Forestry Commission. This private forestry division advises private forest owners on proper management techniques in relation to their forests. On the other hand, the Commonwealth has been quite slow in recommending some of the ideas of Mr Everett and Dr Gentle, and other interested parties, on taxation matters in relation to forestry.
I believe that many of the recommendations of Dr Gentle and Mr Everett do not go far enough to offset the worst effect of woodchip operations. Let me give honourable senators an example of the current situation, which I think will emphasise my point. Under current legislation, if a farmer sells timber to a milling company he pays tax on a royalty basis; in other words, it is included in his normal assessable income under section 26. On the other hand, the selling of a whole area or block to a woodchip operator makes the proceeds tax free, or a capital gain. Here is the rub. As soon as a private farmer employs a forest consultant, implements a plan or even takes advice from this newly created private forestry division of the Forestry Commission, he is technically operating a business of forest management and can be assessed on the whole of the proceeds. Therefore, he pays tax in one year on the total proceeds of the harvesting of a crop which, in fact, takes from 40 years to 60 years to produce. This is indeed an inequitable situation and one under which farmers’ accountants say to beware of introducing a forest plan, proper management practices or taking advice from the private forestry division of the Forestry Commission because what otherwise would be a capital receipt would suddenly become fully assessable. Honourable senators know what an astute farmer would do- he would sell the bush block and get a capital profit. Unfortunately, there is no proper planning.
I have referred to the revenue side. I now wish to give honourable senators an example on the expenditure side because here there is a further complication. There are numerous cases which show that people practising silviculture, which is the business of harvesting and planting trees in high density areas, are placed in a situation whereby their expenses are not always deductible in the year in which they are incurred, but are allowed by the Taxation Office over a 10-year period on an equal instalment basis. This is no way to attract farmers into the process of regenerating and replanting for silviculture. As I have mentioned in this chamber on previous occasions, and from the examples that I have given just now, honourable senators must agree that further amendments to the Income Tax Assessment Act are desirable, or preferably a special division, should be inserted into the Act specifically to cover this growing and important industry of forestry operations to prevent the exploitation of our forests, to protect Commonwealth revenue, to legislate for accepted accounting procedures, and also to promote a renewable resource.
At least one important submission on taxation reform in this area has already been shelved. The Government of Tasmania and the Australian Forest Development Institute have almost completed a submission on formulation of a tax plan in relation to forestry. I believe that this will be submitted to the Federal Government very shortly. Regrettably, as I mentioned earlier, extraction rates do exceed the rate of replacement of trees. In addition, I believe that society should be made aware not only of the monetary but also of the non-monetary impacts of forests. Certainly the aesthetic qualities of a forest are greatly reduced after clearing. But with the employment of trained forest officers, some of the worst effects of the problem can be alleviated. I will cite one example: Bush areas immediately beside a road can be preserved and access to the cleared area can be provided by means of a winding subsidiary road to minimise the view of the destruction to passing tourists or motorists.
Some major companies are at last beginning to recognise some problems in relation to forestry and are spending money to alleviate some of the worst effects. I think that I should name these companies so as to encourage others in the spending of money in this area. For example, Alcoa of Australia Ltd spends $3m annually on forest rehabilitation, or $10,000 for every hectare of land cleared and mined every year. This indicates that a lot of money is involved. Associated Pulp and Paper Mills Ltd has announced recently that it will increase its royalty payments by approximately 25 per cent upon farmers agreeing to enter into a plan to regenerate private forests on their land. In other words, these private landowners must be willing to regenerate their forests with professional and financial help from the company. The objective is to provide a further welcome incentive for private landowners to regenerate their forest areas unless the land is needed for agriculture. I believe that this is the only scheme of its type operating in Australia, and it is most welcome.
It is a fact that forests hold and draw mist. Trees purify the atmosphere around a city because they take in some of the carbon dioxide. Trees on hilltops encourage precipitation. Animal life is abundant in the native forest areas. Softwood forests, though necessary, are relatively barren and lifeless in comparison with our native forests which are the natural sanctuaries of fauna and flora. Therefore, the emphasis on the native eucalyptus species in this Bill pleases me tremendously. Certain types of Australian eucalypt now are facing the serious problem of dieback. Gumtrees in sparsely scattered areas are suffering from a fungal disease which, although present since the early days of settlement, is now becoming a major problem. Of course there are advantages to Tasmania in the woodchip operation. The industry has assisted markedly the rehabilitation of the Tasmanian railways. The woodchip operations have required an upgrading of the railway lines. Fortunately, this increased use of rail transport has taken many timber trucks off our roads and the cargo onto rail and this is to be welcomed. Further, woodchip operators have provided a road network with improved access to forest areas. Ultimately, I believe that this will result in better fire protection in our rural areas.
Approximately 66 per cent of the publicly owned forests are covered by what is known as woodchip concessions over which the State Government has control. I come back to the point I made earlier: The inadequate returns to primary producers raise a number of fundamental questions. Will the farmers be prepared to replace their forests with no assurance of an adequate financial return? On the other hand, will farmers, being independent people, accept being dictated to by government foresters who essentially are under political control? I agree with my friend, Dr Maurice Clark, a not impractical conservationist and former chairman of the forestry division of the Tasmanian Farmers Federation, who said:
With inadequate royalties and government controls, farmers may decide it is better business to thin their forests, leave regeneration to providence, and in the meantime manage to carry more stock.
In conclusion, I urge honourable senators to pressure their respective parties and constituents to ensure that the necessary legislation is passed to encourage more Australians to become more forestry conscious and to encourage the growth of trees on this barren continent. Forest areas cover only 430,670 square kilometres of Australia’s 7,682,300 square kilometres. Less than 6 per cent of the continent is covered with forests. Up until now there has been far too little attention given to reafforestation, particularly in developing suitable species for the low rainfall areas. I believe that much more work should be done by the Commonwealth Scientific and Industrial Research Organisation to overcome this problem and to cover our barren continent with a greater range of trees. It was gratifying to note that earlier this year at least one Tasmanian operator- Tasmanian Pulp and Forest Holdings Ltd, which has now been taken over by Australian Pulp and Paper Mills Ltd- donated more than 1 ,000 young gum trees as part of a State celebration for World Forestry Day. I hope that other companies will follow suit. I commend the Tasmanian Native Forestry Agreement Bill 1 979 to the Senate as a small beginning to a very important project, improving native forests, not only in Tasmania but throughout Australia.
– The agreement covered by the Tasmanian Native Forestry Amendment Bill 1979 provides assistance to the Tasmanian Government on a dollar for dollar basis for all of the work done on the native forests for which assistance was sought by the Tasmanian Government in 1977. Since the preparation of this legislation the Tasmanian Government has asked for a further $100,000 per annum for similar purposes and provision has been made in the current Budget for this extra amount to be provided. This will be covered by supplementary legislation. The money is being made available by way of loan, which is the normal procedure for economic revenue earning projects. In recognition of the time taken for forest products to yield a return on investment, the term of the loan in this instance will provide for a 20-year deferment on repayments and the capitalisation of the interest for a similar period. The repayment of capital and interest is spread over the subsequent 40 years.
The Tasmanian Government has advised that these terms are acceptable to it, although naturally it would prefer, as do all States, even easier repayment conditions. Honourable senators who have spoken on this Bill are representatives from Tasmania. As a Tasmanian, I am very pleased to join them in speaking in support of this measure.
– You ran out on us.
– The comment is not quite right because I hold great interest in this industry and, of course, a great interest in Tasmania. Obviously, it is the premier State for the production of hardwoods and this Bill facilitates that situation. Senator Justin O’Byrne opened for the Opposition in this debate. He had some words with me earlier about some of the very eminent people associated with the development of the timber industry in Tasmania, particularly the seasoning activity. He mentioned one Cyril Niven, the most eminent man in Australia in relation to the early seasoning of hardwoods, who had a great deal to do with the industry when mills were being commenced in Tasmania. It was in those years that I was first associated with the timber industry and had quite a deal to do with Tasmania. I mentioned to Senator O’Byrne that in the late 1 940s, I imagine it would have been, two small vessels, the Leprina and the Argosy Lema, were used by a Victorian company named Smith Bros to bring its timber across from Tasmania. In those days it was a great thing to be working about the Melbourne wharves. I was a tally man on the wharves, dealing with timber, and the stories I heard then were most interesting.
– Did you create as much trouble in the union as you do here?
-Senator Wriedt knows that I was a member of the Timber Workers Union in those days. It was very interesting to go to union meetings, and I learned a great deal about the performance of unions, the way they work and the people associated with them. As Senator Wriedt would know, working on the Melbourne wharves at any stage gives one a good grounding in the way anything works. Senator O’Byrne suggested that the work could be expanded in order to increase employment in Tasmania. Whilst this Bill provides $ 1 36,000 per annum over a period, one could convert that to mean that in this instance Tasmania will receive a grant of $680,000 over that period. In addition, there is provision in the agreement to escalate that amount to take account of inflation, if necessary.
The amount provided is the amount that was sought by the Tasmanian Government in 1977. If there was any criticism in Senator O ‘Byrne’s comments, he must take that criticism to his own State Government and suggest that it is its fault because it asked only for that amount. As to the arguments relating to interest rates and the terms of repayment, those rates have been negotiated between the Commonwealth and the State and, when one looks at the amount involved, one sees that it is not an amount which the State Government could not supply. Certainly, Tasmania has a large investment and needed this extra money to push forward its native forestry program.
Senator O’Byrne also suggested that further research work should be done in Tasmania. That is a separate issue. The Commonwealth Scientific and Industrial Research Organisation already has one of its research divisions at Hobart. Both Senator O’Byrne and Senator Harradine commented on the CSIRO ‘s activities, and I will refer to that when I deal with what Senator Harradine said. The other point I noted in Senator O ‘Byrne’s speech was his suggestion of assistance to private forestry operations. Apparently the Government decided that this should be looked at on a national basis. In previous debates in this place on the softwood forestry agreement, which has come up regularly over the years I have been here, it has been said that private forestry is an important matter. I point out that the Joint Committee of Forest Growers, which is a body established by the Australian Forestry Council, is examining the question. When it makes firm recommendations to the Government I do not doubt that serious consideration will be given to them.
Senator Archer did not make any points that required response, but I acknowledge the contribution he made. Senator Harradine suggested that the amount provided is niggardly. I remind him that it was the amount requested by Tasmania and that, if one looks at it correctly, it can be converted to almost $750,000. It is not a niggardly sum, and undoubtedly his State Government feels that it is appropriate. It is all that was sought by the Tasmanian Government, and I presume that it is the amount the Government believes can be spent profitably. It should be remembered that the operations of the woodchip companies mean that the forests that have been worked over will regenerate naturally and, in addition, funds are provided in this agreement for follow-up work. The money being provided is for the rehabilitation of forests which have become run down because of fires or attempts to convert the forests to agriculture. Senator Harradine also suggested the establishment in Tasmania of the CSIRO ‘s Division of Forest Research. He pointed out, and this issue was raised last night, that Sir Bede Callaghan ‘s report on the Structure of Industry and the Employment Situation in Tasmania recommended that the then Division of Forest Products should be re-established in Tasmania. To make this clear, I wish to quote from the report of the 1 970-7 1 research review of the Division of Forest Products of the CSIRO. Under the heading ‘Reorganization of Forest Products Research ‘ the report states:
This is the final of a series of annual reports and reviews which commenced in 1929. On May 24th, 1971, a CSIRO Executive decision became effective and part of the Division of Forest Products joined with the Division of Building Research to form a more comprehensive Division of Building Research with Dr R. W. R. Muncey as its Chief. At the same time the Sections of Physiology and Microstructure and of Paper Science became a part of the Division of Applied Chemistry under the direction of its Chief, DrS. D. Hamann The research work and title of the Forest Products Laboratory will be retained at South Melbourne for the time being, although future research in wood will be reported separately by the two Divisions concerned. The reorganization will give our research workers new affiliations which will provide a stimulus in their various fields of work.
In short, I point out to Senator Harradine that it is obvious from that report that as a result of a decision by the CSIRO the Division of Applied Chemistry took over some important functions, particularly those related to the production of paper. Senator Wriedt and Senator Watson also spoke on this matter, and I appreciate their comments. Senator Wriedt suggested that there should be a capital and interest repayment holiday and not a deferment. If one reads the Schedule one will find that agreement has been reached on a pretty sound basis and that money is being provided for an economic project. Senator Wriedt ‘s comment about the amount that may be involved applies to any project that has an interest rate associated with it. It is worked out on the basis that the borrower will make an economic recovery, and in this case I imagine that the Tasmanian Government will not be out of pocket. The terms are the same as those under the current softwood agreement, with the exception that the interest deferment period is longer, that is, 20 years as against 1 5 years, and the subsequent repayment period is longer, that is, 40 years as against 20 years under the softwood agreement, and that is a wise provision. The first two softwood agreements had a 10-year interest moratorium associated with them, and perhaps the point Senator Wriedt wished to make was that it would be more acceptable to a government if interest was not charged over a particular period. Economic studies have shown that softwood plantations and the projects covered by this legislation are economic and they can afford to pay the deferred interest.
Senator Wriedt also referred to the Government’s claim that this legislation included a new initiative. I have specified the new initiative which is the agreement to supply a further $100,000 a year which has been sought by the Tasmanian Government since the legislation was prepared. This $100,000 will be provided in subsequent legislation. I thank Senator Watson for his exposition and advice on some of the matters that concern Tasmania. Some of these matters appear in the Callaghan report. I am certain that the Minister for Primary Industry (Mr Sinclair) whom I represent will take note of what has been said. I thank those honourable senators who spoke to the Bill.
Question resolved in the affirmative.
Bill read a second time.
– I refer the Minister for Science and the Environment (Senator Webster) again to the matters that I raised concerning the repayment conditions which he dealt with only in a passing sense in his reply to the second reading stage of the Bill. As I mentioned during the course of my remarks, as I understand it the deferment provisions apply for the first 20 years which is a much longer period than normal. Bearing in mind that the whole agreement is over a 40 year period, can the Minister clarify whether a repayment of $ 1 1.80 will eventually have to be paid over that final 20 year period for every dollar that is borrowed under the program. As I understand it, this amount is composed of $5.40 interest over the 20 years which will accrue during the deferment period. An amount of $6.40 will also be payable for each dollar of capital borrowed in the second 20 year period. I ask for clarification on this aspect. If the information cannot be given today I would like the precise amounts involved and the interest which will accrue to be made clear. I would like to know how that will affect each dollar of repayment over the total period of the agreement.
– I think it is perhaps best that I obtain a schedule for Senator Wriedt. He may like it either incorporated in Hansard or sent to him. It is normal that some cost is associated with borrowing. Certain things are connected with borrowing at the long term bond rate. I am not sure of the current rate. Perhaps I can ask Senator Wriedt whether it relates to the $5.40 or the $6.40 that he mentioned.
– No. The Schedule provides for the long term bond rate. I think that it is 8.8 per cent at present.
– If the bond rate of 8.8 per cent is applied over 10 years repayments effectively would be doubled. Senator Wriedt commented that the Tasmanian Government will be paying back 1 1 times the amount that it borrowed. To me that is quite conceivable. However, one can imagine that if one continues to repay at the bond rate of 8 per cent or whatever it is for 20 years one will repay one and six-tenths times the original borrowing. The amount to be paid back will be quite sizable. However at the end of a particular time there will be a thinning and a recovery of cost. The Tasmanian Government has not been forced to accept the agreement. Because the agreement has been reached by negotiation obviously the Government considers it economic.
– It did not have much option, did it? That is the point.
– I imagine that Senator Wriedt, when he was a Minister, was associated with the drawing up of a number of agreements. Perhaps he can give us the benefit of telling us how he negotiated them. Did he ever negotiate any agreements that contained an interest component? I imagine that he did negotiate such agreements in the area of primary industry which required repayments. I am being asked to calculate whether I will have repaid at the end of 40 years $ 1 1 for every dollar I have borrowed because I have been obligated to pay an interest rate of about 8 per cent. I cannot calculate quickly enough to be able to say whether what Senator Wriedt puts forward is accurate. I think a schedule will have to be prepared. I imagine that what Senator Wriedt says is possibly correct.
– I thank the Minister for Science and the Environment (Senator Webster). I think it would be preferable, when he eventually gets a reply- presumably it will come from the Department of the Treasury- to have it incorporated in Hansard.
– Right, I will do that.
Bill agreed to.
Bill reported without amendment; report adopted.
Bill (on motion by Senator Webster) read a third time.
Debate resumed from 22 August on motion by Senator Carrick:
That the Bill be now read a second time.
– This Bill is not opposed by the Opposition. This legislation is of quite a minor nature and therefore I do not intend to deal with it in any great detail. It is quite unnecessary to do so. Its purpose is to clarify the rate of sales tax for certain items involving television and radio components when included in goods with other components. The television and radio components would normally attract sales tax at the rate of 27!6 per cent, while the other components may attract a lower rate. In effect, the legislation means that if an item includes components, the value of which is 50 per cent or more of the item and they are normally taxable at 2VA per cent, that shall be the rate for the whole item. If they are less than 50 per cent of the value the rate shall be the lower rate applicable to the item which is the predominant proportion of the goods being sold.
We do not oppose the legislation but we have some suspicion that it is perhaps another means whereby the Government is seeking to improve its revenue position. Such matters were referred to in the chamber yesterday during the course of an urgency debate on the disparity of incomes in Australia. If this is the case, any increase in sales tax is an unfair imposition on the people on lower incomes. That almost certainly will apply in this case. I do not wish to rehash the arguments. It is sufficient to say that perhaps with some misgivings we do not oppose the legislation.
– I thank the Opposition for its comments on the Sales Tax (Exemptions and Classifications) Amendment Bill (No. 2) 1979.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Debate resumed from 12 September, on motion by Senator Carrick:
That the Senate take note of the Papers.
-Mr President, once again the Senate is debating a
Fraser Budget, the second Fraser Budget within four months. Twice so far this year the people of Australia have been subjected to the stony heart of the Prime Minister (Mr Malcolm Fraser) and his Government, and one can only say that the two Budgets introduced by this Government in the current year have been regressive, Budgets which have sought to take from the poorer section of the community, the unemployed, the low income earners, and to give particularly to the large corporate sector. I do not know quite why treasurers, accountants and statisticians still continue to use the phrase ‘average wage’ in that supercilious way. It means so little when all know very well that there are many thousands of people below that mythical figure than there are above it.
– It is 70 per cent or more.
– My colleague suggests that it is around 70 per cent. I think that politicians, economists, treasurers and all others would be taken a little more seriously by society generally if they could break away from the use of that expression ‘average wage’ which they use in such a supercilious way. These thousands of people on below average weekly wage, to use the term, along with family households and businessmen and women, are being penalised while the oil, coal and mineral exploiters of our country generally continue to be allowed a free hand as they slip their dividends from many areas to tax-free havens around the world.
The Prime Minister, the man who in 1 975 and 1977 pledged to restore prosperity to Australia and its people, continues down the path of broken promises, so much so that his ratings are at an all-time low. His strongest supporters, even within his electorate of Wannon, now see him as a man with feet of clay. Men and women throughout Australia who almost four hears ago saw Malcolm Fraser as the great white hope for this country have had their expectations dashed to the ground, basically I believe for two reasons. Firstly, he and his Government have failed to deliver; secondly, the Prime Minister’s performances on television, seen in the lounge-rooms of the nation, have destroyed him. People have seen him destroyed by his refusal to answer questions put to him by a diversity of interviewers. The whole nation has seen the Prime Minister duck, weave, and shuffle his feet rather than be honest on issues put to him by these interviewers. Television, the medium which exposed and as a result destroyed that American demagogue, Joseph McCarthy, has done likewise to Malcolm Fraser. He stands before the nation as an empty shell, issuing words not necessarily related to the subject matter under discussion. He is in essence not unlike a robot from the British Broadcasting Commission’s production Dr Who. Perhaps the kindest thing the Liberal Party bosses could do for the present Prime Minister would be to take him out of the country again, perhaps to Lusaka or elsewhere in Africa where, according to his party and the Australian media, at the meeting of Heads of Government he played centre stage for the entire performance, to the detriment of all other actors in the cast. But I fear that ratings in Africa are far removed from the bread and butter issues at home, as the present Government will find when next the citizens of Australia go to the polls.
The ink on the Budget documents was hardly dry before even some members of the Government back bench were vocal about its effects on some sections of the Australian community. The Treasurer (Mr Howard) has had to admit that the present tax system disadvantages single income families. The Treasurer knew that when he was drawing up the Budget but saw fit to do nothing about it. It is plums for big business and not even a crumb for the disadvantaged. According to my information even in the city of Canberra we are witnessing the destruction of dozens of small businesses. People are being forced to close down due to lack of spending power in the community. I understand that some people are even threatened with the loss of their homes as creditors seek their pound of flesh all because this Government has failed to restore confidence and to lower unemployment.
A survey conducted by the Australian Bureau of Statistics in March this year shows the following situation with regard to unemployment. This survey was based on interviews of people in some 30,000 houses, flats, and non-private dwellings throughout the Commonwealth. The main features of this document are that in March of this year an estimated 2,847,200 persons aged between 15 and 64 years were not in the labour force, that is, they were not employed or taking active steps to find a job. Of these 2,847,200 persons, 2,167,550 did not want a full time or part time job and 70,000 persons stated that they had been looking for work in the four weeks prior to the interview week. But of these, 46,300 had taken no active steps to find employment and 23,700 would have been unable to start work in the survey week. However, we find that some 524,600 people would have, or might have, liked a job at the time of the survey. Of these, 402,800 were not looking for work because of personal or family considerations, and 63,400 were discouraged job seekers, that is, they wanted a job but were not looking for work. They believed that there were no suitable jobs in their locality, that employers considered them too young or too old, or they lacked the necessary schooling or experience. Some 1 1 , 200 were not looking for work because they believed there were no jobs with suitable hours.
I think that those sorts of figures indicate the feelings which have been evident in our society for a very long time. Hundreds of thousands of people have dropped out of the work force. They are the hidden unemployed. Various people have quoted figures which claim that our society may well have up to one million unemployed people at present. When we consider that back in March this year, at the time that the survey to which I referred, was undertaken, only some 306,000 people throughout the country were receiving the unemployment benefit, we start to comprehend the great problem which is taking over the business sector of our community.
Those figures surely point up that hundreds of thousands of people in Australia today have no income at all. Those people include families which rely on the breadwinner for their income, but the breadwinner is unemployed. Perhaps it includes even some young people who have been denied the unemployment benefit by this Government and have had to rely on some sort of primitive communism to survive. They have got together and formed types of communes in cities and towns right across the continent. All those people, by not being able to bring in an income every week of the year, in effect are denying the business community the opportunity to expand, to sell goods, to turn over goods and to thrive.
Let us look at how this Budget will affect the housing situation. Since the ascension to power of the Liberal and National Country parties in 1975, the percentage of total Budget outlays allocated to housing has declined. It has declined from 2.6 per cent of total Budget outlays in the Hayden Budget of 1975-76 to 2.3 per cent, 1.9 per cent, 1.3 per cent, and to an estimated 1.1 per cent in the current Budget. The allocation in the current Budget, which is 6. 1 per cent less than the allocation in 1 978-79, has attracted the following comments from the Master Builders Association of Victoria in a document dated 3 1 August:
The 1979 Federal Budget will do very little to stimulate the building and construction industry. The budget affects the industry directly, through the changes in total government outlays particularly public capital works funding, and indirectly through the effects of taxation and general fiscal and monetary policy.
Further on in the document we read:
Housing policy has always been a politically sensitive area. Despite the political rhetoric, the net effect of the Budget will not be to provide a direct stimulus to the housing sector.
Further on, the document states:
Direct payments to the States for housing are substantially down on last year.
I turn now to consider the situation in Victoria. The document states:
The reduction of housing funds to Victoria under the Commonwealth State Housing Agreement from $82.5m in 1978-79 to $63m will have two effects. First, the Housing Commission allocation will probably be cut and government dwelling construction will decline further from the level of 1880 commencements in 1978-79. Secondly, the Cooperative Building Societies allocation may also be reduced unless the Hamer Government can reallocate financial resources as it did in 1 978-79 to provide $55m for its Home Assistance Scheme and $ 1 0m for the Home Finance Trust.
My final quotation from the document appears under the heading ‘Housing Prospects are not Good’ and reads as follows:
Despite the Treasurer’s optimism, the prospects for a sustained housing recovery in 1979-80 are not good.
In Victoria the number of dwellings commenced in 1978-79 was 13 percent less than in the previous year. Government house commencements were one third less in 1978- 79 than previously and the Budget cuts in welfare housing will ensure a continuation of this downward trend in 1979- 80.
I have had a reasonable amount of experience with welfare housing in the electorate of Wannon. Towards the end of the period of the Whitlam Labor Government, the waiting time for people in the electorate of Wannon whose names appeared on the waiting list for welfare housing had dropped from some 2½ to 3 years to around six to eight months. Since this Government came to power in 1975, the lists have grown and the waiting time, whether it be for a two or three bedroom Housing Commission home, has gone back to where it was pre-Labor in 1972.
My time in my electoral office is taken up largely with problems concerning welfare housing. That might be because the Prime Minister is in Canberra and because the local State member, the Victorian Minister for Agriculture, Mr Smith, is never in his electorate. I seem to cop the lot. I do not mind doing the work, but the human tragedies which underlie the housing situation in the electorate of Wannon, as I know it, bring no credit to the Prime Minister, the State Minister for Agriculture, in whose electorate I reside, the Federal Government and the Hamer Government. It is a crying shame that in a country such as Australia, in a rich rural area such as western Victoria, many hundreds of young people, old people- people across every stratum of our society- are being precluded from owning their own homes. That is the situation under a government which claims pride in a great belief in home ownership for every citizen of Australia. Repeatedly we have heard, particularly from the Leader of the Government in the Senate (Senator Carrick), the claim that Australia holds pride of place in the world in the percentage of people who own their own homes. I suggest that if that ever was the case we are fast slipping from the pyramid which this Government claims we have ascended.
Let us look also at the situation with respect to education. I think that all of us in this place are aware of the statements which have been made over a long period by the Minister for Education, the Leader of the Government in this place, who uses as an excuse for cuts in government spending on education an alleged decline in school populations right around Australia. I just wonder what the Prime Minister might have to say to the Minister for Education about the following letter, which is addressed to the Prime Minister, from the Acting Secretary of the Warrnambool High School Council, dated 24 August 1979:
The School Council of Warrnambool High School expresses concern at the Federal Government’s decision to cut back funds for education by over $40 m.
In particular the Council is concerned at the proposed 30 per cent reduction in capital funds for government schools. We believe this will seriously affect the standard of buildings available in schools such as our own.
Already ten of our forty classrooms are of a portable nature, and the quality of this accommodation is far from ideal. Indications at present are that our school population will increase by about another forty students in 1980, and present indications are that at best we could expect more of this temporary type of accommodation.
Naturally we are concerned at the effect this will have on the students who attend the school and their education, and therefore request that the Federal Government reconsider the reduction in capital funds for government schools.
That is again some evidence of the way that the present Government and the right honourable member for Wannon, in particular, are allowing school buildings to decline in his electorate. Quite frequently- every Sunday night I think- Mr Fraser goes public in his electorate on one of the local radio stations and talks about all sorts of things. Now and again he gives a bit of a serve to even the South Australian Government across the border from his electorate. But he does not seem to worry too much about the lack of accommodation at public schools around his electorate and, as a result, has received that letter which I have just read. The fact is that Warrnambool High School is about average when compared with all high schools and technical schools throughout the Prime Minister’s electorateacres of portables and nothing very concrete. This is the man who claims to care for people and who at one stage in his political career was a Minister for Education or a shadow minister for education. We hear a lot of talk from the Prime Minister. Of course, talk is cheap, but when we get down on the ground in Victoria, and even in the Prime Minister’s own electorate, we find that there is still a lot to be done and that he does not seem to give two hoots about those sorts of people.
I suppose that there is no policy area in which the Prime Minister’s credibility has suffered more than in the field of health insurance. The man who in 1975 pledged to the nation that Medibank would be retained has been shown, as in so many other areas, to be untruthful. In the field of health insurance the people of Australia are now in a worse situation than they were in prior to the establishment by Medibank by the Labor Government. Today Mr and Mrs Citizen are faced with a bewildering array of insurance options- an array which resembles a tin of worms or a bag of eels- and all this in a climate of fear perpetuated by health insurance organisations in their advertising for clients. Thousands of people undoubtedly are paying their $10 a week, or whatever, for cover which many of them will never use and that payment is not even tax deductible as it was prior to the establishment of Medibank. Perhaps one of the best exposures of the system which this Government has created was published recently in a Melbourne daily newspaper. It was penned by a citizen of rural Victoria. It is a poem entitled Rhyme but no reason’ and reads as follows:
I’ve opted out of Medibank, HBA and Extras. I ‘ve had enough of paying out, and I ‘m not real dextrous At filling in blue forms, pink forms and whiteHave you had the Asian ‘flu, or just the sandy blight?’ What is your status upon the social tree? ‘ Married or de facto, trapped or free?’ Really, madam, can’t you understand all this? Of course you ‘re getting on in life ‘, And I’m a smart young miss’. I ‘ll explain it all again, in a patronizing voice ‘ There are four different standards from which to make your choice’.
It really doesn’t matter; it will change next week, when the Government manipulates the unprotesting meek into paying more and getting less for fear of getting sick: for fear of getting into debt, and landing in the nick. But me, my friends, I ‘ve opted out. The meek has turned at last to bite the hand that pats it, yet leaves it chained, too fast.
The doctors and the specialists that fatten on the sick are feeling somewhat anxious, and don’t like my little trick of opting out of Medibank and using Public Wards.
They might miss out on extras they get from specialist words like ‘Yes, indeed’, and ‘Come again’. ‘My colleague will consult upon your tests and frequent pain’, We might reveal results’. (‘Our incomes might begin to fall, curtail our trips abroad, the best of cars, of tailored suits. We really can ‘t afford to let those new-chum doctors who habitate the wards Of all the public hospitals, take over all the hordes Of suffering humanity, and cut our just rewards’.) Things look a trifle dicey for the Medi-gods on high, next year they might not make so much out of you and I. They’ve had to talk on Nationwide, and let us scummies know that we can ‘t have the best of care unless we weekly go to pay and pay and pay again.
We’ll never cease, it’s clear, paying out for ever to the specialists in fear.
That is what I believe it is all about at present. Thousands of citizens of Australia are overinsured because of the fear syndrome that this Government has created with its demolition of Medibank and the fear that is being created daily by the various health insurance organisations as they spend thousands and thousands of dollars in advertising. Of course, fear of the bills was the very thing, the very motivation, that led the Labor Party to create Medibank. It was created so that no one need fear the financial consequences of being ill. But all that has gone by the board.
I wish to raise one other matter, the Government’s fuel pricing policies. Due to actions taken by this Government over the last couple of years we have seen a doubling of the price of petrol, diesel fuel, et cetera. Despite the fact that we in Australia produce the overwhelming majority of our own petrol- home-grown petrol out of Bass Strait and Barrow Island- the people of Australia have been forced now to pay twice as much for petrol as they were paying even 12 months ago. The Government has used the argument that an increase in the price would have a conserving effect on the consumption of that commodity, but studies overseas and experience here have shown now that this is not the case. This year the Government, as a result of its moves, will collect an estimated $830m in excise over and above what it collected last year. I suppose that if one were in a good frame of mind and were a fairly generous sort of fellow, which I am sometimes, one could give some credit to the Government for what it has done in this regard. It has never been strong on decentralisation, but in one fell swoop it has decentralised the taxation offices and put them on the street corners of every country town and every major capital city. Thousands upon thousands of little taxation offices are spread right across the nation capturing every motorist when his or her petrol tank gets a little low.
I suppose that at first glance one could say that it is a flat rate of taxation on every petrol consumer across the nation; that would be the first estimate that one would make of it. Whether the consumer be Sir Reginald Ansett, me or an unemployed worker in search of work who has a clapped out bomb in which to get around the countryside, under the Fraser Government’s proposals we are all paying a flat rate of tax when we pull up to the petrol pump. However, when one analyses it a little further one finds out that it is not a flat rate of taxation. There are in the community thousands of people who, because they are businessmen or farmers, are able to claim as a tax deduction the cost of their petrol. On the other hand, thousands of working people and unemployed who must use a car to get to work or to look for work, if only because of the paucity of the public transport system in our society, can claim in their income tax return nothing that will in any way compensate them for their outlay on petrol. Therefore, we have what is in fact an inverse taxation measure whereby the poorer people, the low income earners, are in effect paying more for their petrol than are the business community, the farming community and certain other people.
This steep hike in the price of fuel disadvantages in particular people who live in country areas, where public transport is either thin on the ground or non-existent. Doubling the price of diesel fuels, distillates and, of course, petrol pushes up cost inputs in our primary producing areas. I suppose that if it has a greater effect in one activity rather than another it must surely be in the area of transportation, right across this nation. In a country such as ours, in which the capital cities and the areas of production are so far removed one from the other, transportation represents a heavy charge at any time but the Fraser Government, by using this method of taxation, has added immeasurably to inflation levels. Despite all of the rhetoric that daily we hear from Senator Carrick, inflation is not one of the things that this Government has been able to control. Again, it is part and parcel of the long list of broken promises made by the present Government’s leader, Malcolm Fraser, in 1975, and again in 1977, when he sought office. He has had a sorry history of broken promises. As I said earlier, this man stands destroyed in the lounge rooms of Australia.
– I rise to support the 1979-80 Budget which I believe and which industry and commerce inside and outside of this country believe is a blueprint, a responsible document that will take this country along the course to recovery on which it has been set for some years and on which it will proceed in the years ahead. I follow in this debate Senator Primmer, who has spoken for the Labor Opposition. In many respects I have a very high regard for the honourable senator, but today he fell into the mistake of adopting the usual attitude of the party to which he belongs, one which seems to be concerned above all else with launching abusive and destructive attacks upon, in particular, the Prime Minister (Mr Malcolm Fraser). I do not know why the Australian Labor Party and its socialist supporters do not learn that that sort of constant abuse and attack does not really pay dividends. I know that it is quite to the contrary. I stand here in this chamber as a member of a relatively small, numerically, party in this Government coalition.
– You have the quality.
– As my colleague has said, we have the quality. We have been a significant party in this country for some 60 years and over that period we have been constantly the butt of socialist abuse. My point is that that kind of socialist abuse has never been anything other than a strength to us. In fact, it has virtually served as a commendation of us. That is why I express surprise that Senator Primmer, of all people, should have spent a significant amount of time in abusing Malcolm Fraser and saying that he was not a suitable subject for television. I believe that, more and more, Australians recognise in Malcolm Fraser the sort of leader that they really want, the sort of leader that, incidentally, they have elected twice in three years with the highest majorities that this country has ever afforded to any leader. Mr Fraser is proving, somewhat sadly for the Opposition and the socialists, to be one who is determined to keep to a straight and constant line. As this Budget will demonstrate, he is the leader of a government which has adopted the socio-economic measures that are necessary to lead us out of the problems into which a relatively short socialist era led us.
I wish to say in the beginning that I am somewhat sad to see that, in some significant parts of the media, on the Opposition benches and in the minds of a number of commentators and pseudo-academics it has been considered appropriate- as always- to engage in a constant tirade of abuse about and constant and savage opposition to the Budget. Translated into the political circumstances of Australia, it represents a sad situation and does nothing more than slow down economic recovery and our chances of reaching our potential as individuals, as groups and as a nation. It drives further apart the two basic political entities in this country, and the wider that gap becomes the less chance there is for the survival of that free democracy which is the Australian system, the system of which I believe we are all so proud. It is sad reflection that when the Government brings down a document that is, in the main, a responsible and sensible answer to our socio-economic situation, one finds from the other side of the chamber a reaction that is totally abusive, totally negative. In such circumstances no Australian really benefits. I believe that all of us, if we are honest with each other, will know that that is so.
A budget- this Budget is no exception- is an important document, an important design for all of the people of a nation, in this case Australia. This Budget is an important document for Australia itself. More than that, it is important to people and nations round the world. Prosperity, like depression, is a cumulative circumstance. If this country is able to rise along an economic and social course which takes it somewhere close to the maximum of its capacity it becomes a successful economy, a nation which not only benefits its own people but also is able to contribute to greater prosperity all round the world. It can do that because as communication becomes faster and more sophisticated as the decades roll by, not only the people within our own country but also people around the world are more closely interdependent than ever in the history of the world in which we live. In the working of an economy and the society, it is absolutely important that there is a proper and real measure of confidence. It is the purpose of this Budget, when properly understood, to establish that sort of confidence. It is my hope and objective that the Budget will be received in that manner. I seek leave to continue my remarks later.
Leave granted; debate adjourned.
– by leave- This is a statement which has been made by my colleague, the Minister for Industrial Relations (Mr Street) in another place. I seek leave to have the statement incorporated in Hansard.
The statement read as follows-
The major challenge taken up by this Government has been to get Australia out of the economic and industrial morass into which it was thrown by the Labor Government. We have acted in the conviction that Australia’s problems will not just disappear or be overcome by policies which place short-term political popularity first.
As a direct result, the Australian economy has been improving for some time now. But we recognise that, in a democracy, the ability of any Government to shape the directions of the economy is limited by the attitudes and actions of the individual groups within it. Nowhere is this more apparent than in industrial relations.
Under the Labor Government, industrial relations became the battleground for social and economic conflict. That Government was an active participant in dividing the community as it encouraged trade unions to pursue massive wage increases often through industrial action. Evidence of the damage caused to our industries and to the economy is still apparent despite the fact that under this Government there has been a marked improvement in the standard of industrial relations.
In 1 975, the Liberal-National Country Parties recognised that restoring order to industrial relations was inseparable from responsible economic management. When elected, the new Government immediately set about reestablishing the authority of the conciliation and arbitration system and adapting the industrial relations framework to meet the needs of the parties involved and the community.
To do this the Government set in train a number of specific policies.
Secret postal ballots for all elections for management positions in Federally registered organisations were introduced, and provision made for members of these organisations to receive adequate notice of forthcoming elections. The rights of individuals in industrial relations have been protected.
Employers have been given redress against employee secondary boycotts similar to that against boycotts organised by other companies. The Industrial Relations Bureau has been established. The Government has enacted legislation so that it, as a major employer, can meet its industrial relations responsibilities.
The National Labour Consultative Council has been established as a fundamental part of the Government’s policy of encouraging effective consultation and communication between Government, employers and trade unions.
All of the Government’s initiatives have been designed to provide the framework for the orderly conduct of industrial relations. It is up to employers and employees to use that framework to prevent the serious inconvenience and hardship that results from industrial disruption.
While employers and unions have their responsibilities, the Government recognises that it has its own responsibility to protect the public interest. We make no apology for taking a firm stand when the community is threatened with industrial disruption resulting from campaigns designed to intimidate employers or arbitral authorities. The Government’s policy in relation to these circumstances has been made clear and it will be continued.
Through these policies and its legislation, the Government has done a great deal to improve the standard of industrial relations.
Our efforts have had considerable success. Since 1975, there has been a declining trend in the number of disputes and working days lost. During the time of the Labor Government, an average of 4.1 million man days were lost per year. The average for the 3 years 1976 to 78 was 1.8 million, if the Medibank aberration is excluded, 2. 1 million if it is included. However, it is very disturbing that the latest available information indicates that this decline has been reversed, and disputes are increasing.
At this time, when the trend is towards increased industrial unrest, we would do well to remind ourselves that there is a quite contrary view of the sorts of policies a Government should pursue in industrial relations. The most recent, and most important, expression of that view is the policies endorsed by the Australian Labor Party at their 1979 Conference.
As will become clear, the basic proposition which runs through the Labor Party’s platform is that the trade unions should be placed virtually above and beyond the law. This horse and buggy attitude owes its origins to the character of our industrial relations over 70 years ago.
From its beginnings, one of the principal aims of conciliation and arbitration was to legitimise the role of trade unions. Consequently, the trade unions were given certain privileges under the law which carried with them specific responsibilities.
It is generally accepted that the trade union movement is now in a position to exercise more power than at any other point in its history. The Labor Party, by persisting with the archaic belief that trade unions should still be granted extraordinary additional privileges, has isolated itself from the views of the community, including a large proportion of trade union members.
At their Adelaide Conference, the Labor Party committed an ALP Government to repeal immediately ‘all penalties for strikes against arbitral decisions of the Commission or a conciliation committee and the prohibition of action by the Commission to insert or register clauses in awards or agreements excluding the rights of workers to resort to industrial action’.
The 1977 Labor Party Platform called for the repeal of penalties for employer ‘lockouts’ as well. The pretence to even-handedness was thrown out the window in Adelaide. The words and lockouts’ were taken out, meaning that while unions would be free to engage in strike action without penalty, employers would be penalised for retaliating by engaging in a lockout.
Very significantly, the Labor Party’s policy goes beyond unions taking action simply over pay and conditions. An ALP Government would recognise that the legitimate role of the trade unions is not limited to legally defined industrial matters’. Labor has clearly endorsed ‘political strikes’ in adopting this plank, and has indicated its contempt for the democratic parliamentary process. Labor does not accept Parliament as the proper place for voicing its concerns and opinions, but has deferred to the unions in acknowledging that they can strike on any issue at all and force their views on the Australian public. The plank is a direct threat to democracy.
The Labor Party has also given a commitment to recognise ‘the rights of unions to regulate their own affairs in a democratic way free from Government and judicial interference . . .’ While the Labor Party mouths platitudes about democracy in trade unions, it has denied an ALP Government any way of putting it into practice.
A further example of the Labor Party’s ‘hands off attitude to trade unions is its policy to ‘encourage the membership of registered organisations through the provision of preference to unionists in the taking of leave and … in their engagement and promotion and their retention in cases of retrenchment’.
Under a Labor Government, unions would be positively encouraged to trample over the rights of individual workers with a genuine conscientious objection to union membership or to engaging in industrial action.
Furthermore, the Labor Party would exempt unions from the provisions of the Trade Practices Act. As a result, employers would no longer have redress against employee secondary boycotts similar to that against boycotts organised by other companies.
There is a fundamental difference between this Government’s industrial relations policies and those of the Labor Party.
This Government believes that our system of industrial relations must work in the public interest. For this reason we recognise that Government has a duty to establish an effective industrial relations framework within which labour and management can communicate and settle differences. That in turn means that certain rules have to be made and that they must be observed. Those rules must be designed with the aim of preserving a democratic society in which people can go about their legitimate business free from unwarranted interference.
The Labor Party takes a different view. Their approach is to say that employers should be subject to regulation, but unions should not. To the Labor Party, unions should be free to take whatever action they choose on whatever issues they choose.
The Labor Party would place unions above the laws everyone else is expected to observe. Their policies are a direct inducement to the trade unions to operate outside our system of conciliation and arbitration. As such, they are an affront to our democratic process and a deliberate attempt to undermine the effective functioning of our economy.
The Government will have no part of policies which grant any section of the community extraordinary, unjustifiable privileges which can be used to deny others their legitimate rights. The basic objective of this Government has been and still is to restore order to industrial relations. Above all, that means, the Government will continue to do all that it can to encourage the parties to work within the proper processes of conciliation and arbitration.
Currently, the most important example is the Government’s policy on the future of centralised wage fixation.
In handing down its last National Wage Case Decision, the Conciliation and Arbitration Commission said that it had been brought to the brink of abandoning wage indexation. It said the actions and attitudes of various participants in the system were incompatible with its effective operation and the system was not working.
The Commission commented further that the consensus on wage fixation had been weakened to a stage where it appeared ‘that one side wants indexation without restraints and the other wants restraints without indexation ‘.
In particular, the Commission stressed that a voluntary system of wage fixation must be based on consensus and that ‘an equitable sharing of burdens and benefits should continue to be the dominant element of wage fixation’. To try and re-establish that consensus, the Commission called an urgent Conference of all parties to consider whether centralised wage fixation had a future.
Subsequently, all parties agreed that such a system was desirable and that each party should review their respective positions in the light of the Commission’s statements.
At the first hearing of the Wage Fixation Conference on 4 July 1979, the Commonwealth Government gave an undertaking that it would make a positive contribution towards reaching a consensus. At the first available opportunity, the Government met that undertaking.
The Government’s proposals require that two perfectly reasonable pre-conditions be met: first, there is a commitment from all parties not to pursue or grant wage claims outside the wage fixation principles, and second, a rejection of industrial action in support of such claims. In return, the Commission should award wage increases every 6 months for movements in the CPI discounted Tor increases due to Commonwealth Government policy decisions.
At present the Conciliation and Arbitration Commission may be persuaded not to grant full indexation and there have been a number of decisions in which they have not done so. The uncertainty as to whether and to what extent employees will receive a wage increase has influenced some unions to take industrial action for wage increases outside the wage indexation guidelines.
By providing certainty of adjustment, the Government’s proposals would remove this pressure for industrial action.
The Government has proposed that any wage adjustment in line with the CPI be discounted for the effects of Commonwealth Government induced price increases. The Government believes that in cases where its policies involve a cost to the community, one section of the community should not be compensated leaving others to shoulder the entire burden.
Of course, Government induced price increases may not occur every 6 months. In these circumstances, provided the preconditions are met, employees would have the certainty of automatic full adjustment of wages for price increases. I remind the House these pre-conditions are: no wage increases outside the wage fixation principles and a rejection of industrial action in support of such claims. In addition the Government’s proposals recognise that claims for wage increases on legitimate work value grounds may continue to be heard but subject to rigorous examination and testing. No-one who feels they have a genuine case can object to that.
The Government has also proposed that as part of its package there should be no productivity hearing until at least October 1 980 and that in any future hearing only the movement in productivity which occurred over the preceding 12 months should be considered.
I have said that the Commission gave notice to the community that it was on the brink of abandoning indexation because of the attitudes of the various parties. The Commission called upon the parties to re-assess their attitudes.
So far, only the Commonwealth has thoroughly reviewed its position and put forward a positive, constructive proposal. There is now a clear obligation on the other parties, having agreed that they want an orderly, centralised system of wage fixation to continue, to respond to the Commission’s challenge.
The reaction of the ACTU and the ALP was to condemn the Government’s proposals out of hand without attempting to give them any serious consideration. It is precisely this sort of unthinking pig-headedness, so apparent at the time of the attempted prices, wages freeze, which has led to the current difficulties in industrial relations. As the Commission has said, these attitudes must change if we are to return to a sensible equitable system of wage fixation. It would appear that neither the ACTU nor the ALP is interested in a return to such a situation- a situation which is clearly in the best interests of the vast majority of their members and of the community as a whole.
The preposterous claims by the Leader of the Opposition that the Government’s proposals would result in employees receiving about 65 per cent of indexation is clear evidence that the ALP is not interested in reconsidering its own threadbare position or in making a positive contribution to the re-establishment of a consensus on wage fixation. Such statements are mischievous and misleading. Any reasonable estimate of the wage increases likely to flow from the Government’s package shows approximately 80 per cent indexation is the likely result over the life of the package. The Government is able to make this offer only because of the success of our policies in reducing inflation and improving our international competitiveness.
The Government has taken the initiative to reestablish the basis for consensus between the parties invol ved in wage fixation. By contrast, the Labor Party is barren of ideas on this crucial issue. Nothing illustrates this more clearly than the policy endorsed by the Labor Party at its 1 979 Conference and I quote from it:
With the understanding and co-operation of the trade union movement, (Labor would) develop and implement a policy which will encompass prices, wage incomes, non-wage incomes, the social wage, taxation reform, and elimination of tax avoidance, and which will achieve a more equitable distribution of our national wealth and income, with the commitment to supporting the maintenance of real wages by quarterly adjustment and the passing on of the benefits of productivity. ‘
This was the issue on which the Left-wing of the Labor Party enjoyed its major victory and precipitated the rift between Mr Hawke and the Leader of the Opposition. The deep divisions it revealed in the Labor Party were widely reported and remain an explosive issue.
Even the Premier of New South Wales, who is no stranger to hiding divisions, could find no better words to describe this policy than as a ‘hotchpotch’. The Leader of the Opposition, on the other hand, had to buy peace to stop the Conference flying apart. For him, doing that presented a welcome bonus, an opportunity to disown and humiliate Mr Hawke and his economic committee.
The only thing their wages policy commits the Labor Party to is supporting wage increases.
For instance, a Labor Government would support re-introducing quarterly National Wage Case Hearings. Employers would once again be faced with the instability and administrative costs that rapid wage increases bring. The effect would be to reduce business confidence and efficiency and the productive capacity of our industries. That means fewer jobs. The Conciliation and Arbitration Commission itself, in moving to 6 monthly hearings, has acknowledged the unsettling effect of too frequent wage changes.
A Labor Government would support automatic full indexation with no discounting for CPI increases resulting from Commonwealth Government policy decisions. This is a discriminatory approach. Government policies which increase prices should apply equally throughout the community.
Certainly that is the policy of this Government. However, the Labor Party would selectively discriminate between those whose incomes depend on decisions of the Commission and the rest of the community. Active discrimination in terms of compensation is not the only problem.
Another problem is that by agreeing to wage increases to offset price increases flowing from Government policies, a Labor Government would deliberately undermine its own policieswould render them ineffective. This approach is all too reminiscent of the total confusion and lack of co-ordination which characterised the Whitlam Government.
The Labor Party has been quite insistent on what minimum wage increases should be. At the other end of the scale it has nothing to say. When you wade through the verbal quagmire which passes for the Labor Party’s incomes policy, it becomes quite apparent that while they are committed to supporting quarterly indexation of wages for the full CPI and for productivity increases, there is no intention of stopping there. This clearly is a minimum on which the unions with industrial muscle would be free to build to get even larger wage increases.
It was this irresponsible attitude which gave the ACTU the green light to adopt what can only be described as a cruelly selfish and destructive wages policy. According to the ACTU, employers and the Government should abide by decisions of the Conciliation and Arbitration Commission, while unions should be free to pursue any wage claims they want, over and above increases awarded by the Commission. Furthermore, the ACTU has encouraged unions to threaten or use industrial disruption to line their own pockets.
The central role played by Hr Halfpenny in having this policy adopted is highly significant. Nothing could illustrate more clearly the domination of the extreme left, and their total unconcern for the effects of their policies on the economy and unemployment. The ACTU has caved in to the extremists just as the Labor Party did in Adelaide.
The ALP and the ACTU now have virtually identical and equally disastrous wages policiesthe Hayden- Halfpenny axis.
In July this year, the Leader of the Opposition worked actively to have a policy endorsed which has, as its principal feature, a deliberate avoidance of any reference to wage restraint in any shape or form. Yet, on the 18th of February this year, he said, ‘For their part, the unions must accept that the economy cannot bear unreasonable wage claims’.
Quite clearly, when it comes to buying off the Left-wing of the Labor Party for the sake of his own political survival, the Leader of the Opposition can find no place for economic responsibility in his plans.
This policy has taken the Labor Party far away from the views of the people it purports to represent.
A survey conducted by McNair Anderson in May of this year showed that of the 800 members of the workforce questioned 59 per cent agreed that wage increases these days often means someone else loses a job and that twothirds believed that wage increases wouldn’t really help. A similar survey conducted by the same organisation last year showed that 63 per cent of union members do not believe that union pressure for wage increases is supported by the rank and file. Interestingly, only 20 per cent of union leaders held the same views.
It is quite obvious that the Labor Party has aligned itself with that element of the trade union leadership which is determined to push for huge increases in wages irrespective of the capacity of industry to pay. In short, nothing has changed. The Labor Party still refuses to acknowledge the well-established link between wage increases, higher rates of inflation and unemployment. The fact that there is no reference to this link is the most glaring omission in the Labor Party’s so-called wages policy. The Labor Party is still not prepared to stand up to the irresponsible element in the trade union movement and argue for wage restraint and more jobs. The two are inseparable. Instead, they have now supinely added wages policy to their ‘hands off the unions ‘list.
This policy is similar to that followed by the Whitlam Government, a permissive industrial relations policy which saw a dramatic increase in industrial disruption, excessive wage increases, galloping inflation and the loss of hundreds of thousands of jobs. It must be recognised that the economic cost of the Labor Party’s wages policy is measured not only in terms of wage increases but also includes the cost of the increased industrial disruption and increased unemployment associated with the push for higher wages. The cost of disruption and loss of employment can be greater than the cost of wage increases themselves. Disputes destroy business confidence, upset planning and adversely effect a reputation overseas as a reliable supplier. The Labor
Party’s policy would not only condone industrial disputes, it would encourage them.
As for prices, all we can find is a vague assertion that their policy would ‘encompass prices ‘-whatever that means.
The Labor Party’s deliberate neglect of the question of excessive wage increases betrays their lack of will to fight inflation. To the Labor Party, the problems inflation brings- lower business confidence, reduced capacity and fewer jobs- can be overcome by Government spending on a massive scale.
Already they have admitted how they proposed to finance that spending; a massive increase in both public spending and the Budget deficit, 75 cents in the dollar tax on higher incomes, a resources tax in addition to existing company taxes, and an as yet undefined, socalled wealth tax.
What sort of incentive does that provide for taking risks, for hard work, or for investment and expansion to create new jobs.
In short, the Labor Party’s incomes policy means no limit to wage increases and no limit to public spending and the deficit.
However, the people of Australia will have none of it. The previous Labor Government’s policies provided a dramatic demonstration that wage increases have a cost. That cost is reduced profitability, higher inflation and, inevitably, fewer jobs.
However, there are some in the Labor Party who have to face reality. The honourable member for Gellibrand, who has the unenviable task of trying to explain the Labor Party’s view of economic issues to the electorate, when referring to previous experience, was reported as admitting, ‘wage increases of a very large nature made it inevitable that there would be very large price increases following . . . ‘
Yet, that is precisely what the Labor Party proposes to do all over again.
The Labor Party may try and claim that if elected this policy gives them the opportunity to seek some kind of social contract with the trade unions. That kind of contract, and how large the wage increases would need to be to buy off the unions, are questions they are not particularly keen to answer at the moment- and of course, they can’t. The reason is that many in the Labor Party realise that their so-called social contract has absolutely no chance of success.
The Labor Party’s incomes and prices policy is not a policy at all. It is just a few lines of rhetoric designed to cloud the issues until the next election. It couldn’t even cloud the issues for one day between the Leader of the Opposition and Mr Hawke.
This Government has emphasised time and again that industrial relations can make a positive contribution to economic recovery. We believe that if Government, employers and unions are willing to place the national interest first, there is no reason why all parties cannot cooperate to get the most out of what the Australian economy has to offer. Few, if any countries in the world have more to offer. However, the job is made much harder when proposals are put forward under the guise of alternative policies, which on analysis turn out to be nothing more than barrow-pushing for narrow sectional interests.
I am convinced the community recognises that and will see through the Labor Party’s industrial relations and wages policies for what they arejust another repeat of the same old recipe for industrial disruption, inflation and the end of economic recovery.
This Government has worked hard and successfully on behalf of the Australian community to reduce inflation, restore our competitiveness and create more jobs. Much has been done. But the Labor Party would throw it all away. Instead of building on the solid foundations laid down over the last four years they would set about undermining them. We won’t let that happen, and neither will Australia.
– I move:
That the Senate take note or the statement.
-This statement, which I have had the opportunity of reading briefly, is euphemistically described by the Minister for Industrial Relations (Mr Street) us a statement on industrial relations and wages policy. If there are two things that are not coherently explained in this statement they are, firstly, an industrial relations policy, and secondly, a wages policy. This document is a typical document from the Liberal Government, lt is a cynical, political tirade to which we are treated from time to time when the Government feels its fortunes are going particularly bad and it wants to whip up a bit of a diversion in the community in order, it hopes, to consolidate its electoral position. The first thing that one can say very clearly about the statement is that it does not come from Mr Street, the Minister for Industrial Relations. It is a characteristic statement using industrial relations as a cynical exercise in trying to divert attention from the major problems of this
Government which are the problems of economic mismanagement, broken promises, the general question of credibility and the deep social divisions which the policies of this Government have engendered in this country.
As I have said, every now and again, we get the big stick, the huff and puff approach about these issues, seemingly to coincide with the phases of the moon or something of that kind. I noticed during the parliamentary recess that some expert on biorhythms was in Australia and warned us that we should be very careful to take note of the biorhythms of the Prime Minister (Mr Malcolm Fraser) at certain stages of the year. Of course, in my view it is not his biorhythms about which we ought to be concerned; it is his mind. He has clearly displayed the deficiencies of his mind in relation to this statement. I assert that if any honourable senator in this place were up the Amazon in the darkest jungles of Brazil and he read this statement, it would be quite clear to him from where it came. It came from the office of the Prime Minister of Australia. It does not come from the office of the Minister for Industrial Relations because, as I will point out, a lot of things in it are quite inconsistent with the views which have been expressed by the Minister for Industrial Relations over the year. If I can just illustrate that by referring to the document itself. On page 2 of the document, talking about the Government’s industrial relations policy, it states:
Our efforts have had considerable success. Since 1975, there has been a declining trend in the number of disputes and working days lost.
It sets out the working days lost. The paragraph finishes with this extraordinary statement:
However, it is very disturbing that the latest available information indicates that this decline has been reversed, and disputes are increasing.
What an extraordinary admission to have in a document. It is saying: ‘Our industrial relations policies have solved the problems. They have worked for a while ‘. Of course, they have worked for a while because the Prime Minister broke his promise that unemployment would decline in Australia from February 1978. Of course, there was a decline in industrial disputes because of the high levels of unemployment which exist in this country. It is only now that there is a higher level of industrial disputes because in spite of the high unemployment the standard of living of the families of this country has been so eroded by this Government’s policies that unions have increasingly resorted in more recent months to industrial disputation and involvement in industrial disputation. 1 just draw attention to that aspect of the statement because it clarifies in a crystal clear way the indecision and uncertainty that there is about the whole thing. Let me illustrate what I mean by a cynical approach to industrial relations by referring the Senate to something which happened in October 1977 when this Government, the Fraser Government was seeking an excuse for an early election. We had a lot of huff and puff about industrial relations at that time. The Leader of the National Country Party (Mr Anthony), the professional loud mouth of Australian politics at that time, made this statement about industrial relations. He said:
Sooner or later the Government has to face up to this issue and go to the Australian people and say: ‘ We are prepared to govern with courage and a sense of responsibility, but you have got to back us’.
The Government could not stand up to the unions knowing it had only six months life in the Parliament. He said:
We’ve got to know that we’re going to stand up there, be firm, and know that we have a period of two or three years in front of us to try and get this country under control.
That was in October 1977, just on two years ago. The Government has had its two years now. According to this statement, there has been no improvement whatsoever in the industrial relations climate which at first improved, according to the Government, and now has declined, as indicated in the statement. If one contrasts the statement of Mr Anthony- as I have said the hard-line loudmouth on this issue- with the mealy mouth statements of the Minister for Industrial Relations, Mr Street, one sees something of the confusion of industrial relations in the Government’s policies. Let me point out to the Senate where that all begins. It begins where the cause of all this Government’s problems begin- with the Prime Minister. In 1975, when making what was then generally regarded as an important speech about industrial relations, Mr Fraser as shadow Minister for Industrial Relations had this to say:
Our view is that satisfactory industrial relations depend ultimately on the attitudes of mind of people in industry. Attitudes of mutual respect, of willingness to listen, to understand, to reason, and discuss in an informed way, are essential. These attitudes cannot be created by any party’s industrial relations policy.
He went on to say: the L-NCP believed that rules -
As he calls them-
Must be established that carry consequences.
He then announced what he calls the proposal for an Industrial Relations Bureau as a third arm of conciliation and arbitration. They are two quite inconsistent schizoid attitudes to an industrial relations policy. On one hand there is the soft option and, on the other, what he sees as the tough one. Of course, people are pardoned and must be pardoned for being confused about the totally cynical and, as I say, schizoid attitude of this Government on these questions. They are apparent through every statement which has been made in the life of this Government. They are apparent in the personalities of the Minister, ineffective as he is, on the one hand and the hard liners of the Government on the other. What this statement amounts to again is the use of what one might call the scapegoat syndrome in Australian politics. This was a technique very much favoured by the late President Sukarno of Indonesia. It was called Sukarnoism; in Australia it is called Fraserism. When things are going bad for his Government, he can seek to divert the electorate by talking about something altogether different. On this occasion, as on all previous occasions, it is industrial relations.
Let us look at some of the confusions which arise in the application of the scapegoat syndrome in this Government’s policies. First of all, throughout the last four years there have been repeated statements that unions and wage claims are responsible for the Government’s economic difficulties, or if it is not the unions, it is the Arbitration Commission or anybody other than the Government. When it came to power in 1975 in the manner in which it did, it took upon itself the obligation to deal with all these matters. It is an obligation it has never had the guts to discharge on any of these issues. Let me illustrate that particularly by reference to what the Prime Minister had to say only on 16 August and 19 August this year in interviews with the Australian. After four years of talking about wages and the Arbitration Commission being the problem and the cause of inflation, he stated:
I suppose wages have been in a sense neutral in terms of their effect on inflation.
That is what the Leader of this Government- our leader in this country- had to say after four years of saying exactly the opposite. He went on to say:
There has been very little wage drift outside the Commission’s determinations, much less than I think most people would believe.
Talking to the Age in Melbourne a week later, on 25 August, the Prime Minister had this to say:
Wage adjustments have been greater than we wantedgreater than we expected.
That is a totally different answer from the one he gave the Australian a week before, and those answers are totally different from the allegations in this statement which the Government has now brought down. There is an extraordinary confusion of mind. How can the poor wage earners be anything other than confused when they suddenly read the Australian and find that their claims have not been responsible for inflation at all, that they have never got anything outside the Arbitration Commission, and then a week later they read something totally inconsistent with that. How will people believe in a government led by this man? It is an extraordinary characteristic of this statement; right throughout there is a desire to blame anybody else but himself which, by the way, is a particularly immoral position for a public figure to adopt. It is not surprising from the present Prime Minister. The depths of public immorality to which this country has sunk under the leadership of this man are displayed, of course, in the man himself, in his public utterances on matters of this kind.
In the course of the document the Minister then goes on to deal with some of the initiatives of this Government, as he calls them. Let us look at the initiatives of the Government which the statement regards as important. First of all, there is the establishment of the Industrial Relations Bureau. Two years later, the reports of the Industrial Relations Bureau show what it has been up to. The Minister for Industrial Relations, Mr Street, in dealing with the first report of the Bureau really adopts, if I might say so, the mealymouthed approach. He details a number of matters with which the Bureau has dealt and states that a million dollars has been recovered by the Industrial Relations Bureau for employees entitled to receive full award wages. That is in the exercise of the function of the old arbitration inspectorate. He then says that the Bureau is answering a number of inquiries and is investigating a number of complaints.
The fact of the matter is that in the whole period of its existence- at great expense- the Industrial Relations Bureau has really done nothing in terms of the industrial relations scene in this country. It has investigated complaints and engaged itself with some 120 prosecutions against employers for breaches of awards. As is set out in the statement, it has investigated a number of complaints about unions but nothing has ever happened except in one case which occurred in Melbourne and which involved a prosecution of the Melbourne City Council. That was a prosecution nicely timed to coincide with the Victorian State election. Of course, that has been the use to which the Industrial Relations Bureau has been put. What happened to that one prosecution of an employer for allegedly victimising a member of a union, or a person who refused to join a union or take action in accordance with a union strike? That case went to the Federal
Court. It was thrown out by the judge on the basis that it was brought in a manner which was technically deficient. It is apparent from the judgment that in terms of industrial relations policy it was undesirable, anyway.
The Minister for Industrial Relations talks about that as an important initiative of this Government and he talks about the secret ballot legislation in respect of which a number of unions have been granted exemptions, so making nonsense of the whole legislation. He talks about the legislation for the National Labour Consultative Council in respect of which this Government made the petty-minded decision to exclude white collar unions at the establishment of that body; he talks about the trade practices legislation as if to indicate that that was a great and important step in the industrial relations policy of this Government. It is very interesting to note that the Trade Practices Commission, which had its Act amended to deal with industrial matters, in the last two years has developed a very sophisticated arrangement with the Australian Council of Trade Unions and the national employers policy body to refer any disputes which come to the Commission and which have an industrial relations content to those two bodies for resolution.
That is what the Trade Practices Commission thinks of this Government’s legislation. This great record of bandaid initiatives and huff and puff which has gone on for four years in the field of industrial relations really amounts to nothing. The Government has made no attempt to review the Conciliation and Arbitration Act in a thorough way; it tacks on bits here and there when it thinks it suits it politically. It has made no attempt to arrive at a coherent wages policy and it has made no attempt to grapple with the major issues of industrial relations which were referred to by the former Leader of the Opposition and present Prime Minister in his statement in 1975 when he seemed to have some greater appreciation of the real issues involved.
The second aspect of this paper is an effort to denigrate the Leader of the Opposition (Mr Hayden). That is the second point of the statement on industrial relations, lt is really an extraordinary exercise. Of course, the purpose of using a statement on industrial relations to denigrate the Leader of the Opposition is that Malcolm Fraser is running a bit scared and it becomes important now to endeavour to denigrate the Leader of the Opposition at every opportunity. The vehicle for this denigration is to refer to the Austraiian Labor Party Conference which took place in Adelaide in July of this year. From his statement, the Prime Minister seems to find it quite extraordinary that the ALP should have in its platform and should have adopted at that conference a general statement relating to prices and incomes. That is referred to particularly in the statement which has been brought down by the Minister. It uses the following words: . . with the understanding and co-operation of the trade union movement, develop and implement a policy which will encompass prices, wage incomes, non-wage incomes, taxation reform and elimination of tax avoidance . . designed to achieve a more equitable distribution of wealth in Australian society.
That statement is attacked because it brought in the newspapers of the day allegations of a rift between the President of the ACTU and the Leader of the Opposition. There is really no worthwhile attack in this statement on the substance of the platform which was adopted. The sooner that this Government starts to think about the relationship between prices and incomes, between wage incomes and non-wage incomes, between profits and wages and the elimination of tax avoidance as matters which are essential if one is to derive some form of social consensus about these uses, the better. The point which the statement does not mention is the need for the Commonwealth Government to obtain constitutional power so that it can impose a more uniform system of industrial relations throughout Australia. That was inserted in the Australian Labor Party platform at the Adelaide Conference and it is a matter of fundamental importance. Even the Prime Minister seemed to grasp it a few months ago when he was desperately looking for some new initiative in the industrial relations field. He suggested that perhaps the States might refer powers on those matters to the Commonwealth Government. This seems to have been backed away from now, although it is a matter for further discussion.
The whole purport of the statement, as I said earlier, is to distract attention from the Government’s failures in relation to economic policy, from the abandonment of a number of promises which the Government has made, and to try again to divert attention to industrial relations as an issue in respect of which the Government can make tough noises and take no initiatives. That is the record of this Government in the five years that it has now been in office. I refer honourable senators to a view put by Mr George Polites, the secretary of the National Employers Policy Committee, on this very question of politics and industrial relations. When Mr Anthony, in 1977, said that this Government needed a mandate, as he put it, to stand up to the unions- a piece of irresponsible waffle of the first order- Mr Polites was asked this question:
Could you explain to us as simply as you can how an election a year ahead of time is going to help curb industrial unrest?
Mr Polites replied:
I didn’t know that there was going to be an election a year ahead of time. If you know that I am pleased to hear it. I don’t think it’s got anything to do with industrial unrest.
If honourable senators opposite will not listen, as a government, to the overtures made by bodies like the Australian Council of Trade Unions and to the National Labour Consultative Council, which the Government set up as a piece of rhetoric and nothing else, on these important issues perhaps they should listen to the national employers. They are as concerned about this sort of huff and puff stuff that honourable senators opposite go on with as anybody else in this country. National employers are concerned because from day to day they have to negotiate with unions and reach sensible and coherent agreements with them. They know that the way to the settlement of industrial disputes in this country is the way which has always succeeded- by negotiation. There is not one dispute which has been settled during the life of the Fraser Government by any initiative of Malcolm Fraser. Not one. Many have been exacerbated by his actions. The only disputes which have been settled by initiatives have been settled by initiatives of the employers or the Australian Council of Trade Unions. There is no secret about the popular success of the President of the ACTU, Mr Bob Hawke, as a public figure. He has very high public ratings, as distinct from Malcolm Fraser who has very low public ratings. The reason for this is that Bob Hawke stands for conciliation in this country and Malcolm Fraser stands for confrontation.
People do not like that sort of confrontation. We are getting another example of it tonight because of the werewolves in the Liberal Party who howl when the moon comes out. They think: ‘We will wave the big stick and impress our back benchers and the old ladies in white tennis shoes in the Warringah branch of the Party and show them how tough we are in dealing with these problems. ‘ Of course, it is the most phoney political exercise which any Government has engaged in in the history of this country. It is the most phoney activity and the most cynical political exercise. Any government which is genuinely concerned about arriving at a sensible, consensual solution to these problems ought to display totally different attitudes.
I conclude by referring honourable senators to two very important statements which this Government is not prepared to take any note of when it goes on with the sort of stuff that is in this statement. The first is the view of the Jackson Committee, which is something the Government has not taken much account of. Perhaps this passage is worth referring to. The Committee states:
Changes in decision-making processes should be attempted only with the willingness and full involvement of management, employees and unions . . . There can be no progress in an atmosphere of bad industrial relations or of job insecurity . . . Unions for the most part have conservative traditions and find it no easier, perhaps harder to adapt than do firms. Their difficulties are little understood by managements and governments.
That refers to this Government in particular. That statement can be found at pages 13 and 14 of the Jackson report. I commend it, as well as a lot of other wisdom in government reports which is being ignored, to the Senate.
Sitting suspended from 6.1 to 8 p.m.
General Business taking precedence of Government Business after 8 p.m.
If we took the total population of Australia and somehow reduced the persons concerned to the age and status of those under 12 years, we would still have less than one per cent of the child population of the world. There are one billion five hundred million children under 12 years of age round the world. That is the scope of the challenge with which we are confronted by the United Nations in this International Year of the Child. In its Declaration of the Rights of the Child, which I will seek shortly to incorporate in Hansard, the United Nations challenges us to improve the lot of children wherever they may be, without regard to geographical or social barriers. As the last part of the preamble states, mankind owes to the child the best it has to give. I will touch on the appropriate response to the international situation of children towards the end of my remarks, but I wish first of all and largely to concentrate on some aspects of the Australian situation- the child in our own backyardbecause here I believe there is no cause for apathy or complacency.
I was stung into putting this matter on the Notice Paper by my constant attendance- I am sure other honourable senators have shared this experience during the year- at various celebrations, competitions and events to mark the International Year of the Child- all very happy, all very superficial, and perhaps helping to foster a general apathy or complacency in the community about the state of our children. As I want to demonstrate, the rights of our children in various ways are by no means guaranteed by the sort of society we have operating in Australia at the moment. There are three million children under 12 years of age in Australia, and it is concerning their rights that I wish to speak tonight, at least in part. I seek leave to incorporate in Hansard the Declaration of the Rights of the Child as promulgated by the United Nations.
The document read as follows-
DECLARATION OF THE RIGHTS OF THE CHILD
Whereas the peoples of the United Nations have in the Charter, reaffirmed their faith in fundamental human rights, and in the dignity and worth of the human person and have determined to promote social progress and better standards of life in larger freedom.
Whereas the United Nations has, in the Universal Declaration of Human Rights proclaimed that everyone is entitled to all the rights and freedoms set forth therein, without distinction of any kind such as race, colour, sex, language, religion, political or other opinion, national or social origin, property binh or other status.
Whereas the child, by reason of his physical and mental immaturity, needs special safeguards and care, including appropriate legal protection, before as well as after birth.
Whereas the need for such special safeguards has been stated in the Geneva Declaration of the Rights of the Child of 1924 and recognised in the Universal Declaration of Human Rights and in the statutes of specialised agencies and international organisations concerned with the welfare of children.
Whereas mankind owes to the child the best it has to give.
The General Assembly
Proclaims this Declaration of the Rights of the Child to the end that he may have a happy childhood and enjoy for his own good and for the good of society the rights and freedoms herein set forth and calls upon parents, upon men and women as individuals and upon voluntary organisations, local authorities and national governments to recognise these rights and strive for their observance by legislative and other measures progressively taken in accordance with the following principles.
The child shall enjoy all the rights set forth in this Declaration. All children without any exception whatsoever shall be entitled to these rights, without distinction or discrimination on account of race, colour, sex, language, religion, political or other opinion, national or social origin, property, birth or other status, whether of himself or of his family.
The child shall enjoy special protection, and shall be given opportunities and facilities, by law and by other means, to enable him to develop physically, mentally, morally, spiritually and socially in a healthy and normal manner and in conditions of freedom and dignity. In the enactment of laws for this purpose the best interests of the child shall be the paramount consideration.
The child shall bc entitled from his birth to a name and a nationality.
The child shall enjoy the benefits of social security. He shall be entitled to grow and develop in health, to this end special care and protection shall be provided, both to him and to his mother, including adequate pre-natal and postnatal care. The child shall have the right to adequate nutrition, housing, recreation and medical services.
The child who is physically, mentally or socially handicapped shall be given the special treatment, education and care required by his particular condition.
The child, for the full and harmonious development of his personality, needs love and understanding. He shall wherever possible grow up in the care and under the responsibility of his parents, and in any case in an atmosphere of affection and or moral and material security, a child of tender years shall not, save in exceptional circumstances, be separated from his mother. Society and the public authorities shall have the duty to extend particular care to children without a family and to those without a family and to those without adequate means of support. Payment of state and other assistance toward the maintenance of children of large families is desirable.
The child is entitled to receive education, which shall be free and compulsory at least in the elementary stages. He shall be given an education which will promote his general culture and enable him on a basis of equal opportunity to develop his abilities, his individual judgment and his sense of moral and social responsibility and to become a useful member of society.
The best interests of the child shall be the guiding principle of those responsible for his education and guidance, that responsibility lies in the first place with his parents.
The child shall have full opportunity for play and recreation, which should be directed to the same purposes as education, society and the public authorities shall endeavour to promote the enjoyment of this right.
The child shall in all circumstances be among the first to receive protection and relief.
The child shall be protected against all forms of neglect, cruelty and exploitation. He shall not be the subject of traffic, in any form.
The child shall not be admitted to employment before an appropriate minimum age he shall in no case be caused or permitted to engage in any occupation or employment which would prejudice his health or education, or interfere with his physical, mental or moral development.
The child shall be protected from practices which may foster racial, religious and any other form of discrimination. He shall be brought up in a spirit of understanding, tolerance, friendship among peoples, peace and universal brotherhood and in full consciousness that his energy and talents should be devoted to the service of his fellow men.
– I hope to take some areas from that Declaration of the Rights of the Child and describe practical concrete constructive steps which ought to be taken in order to secure some of those rights on behalf of these children. We have to secure their rights; they are inherent in them of course, but the most obvious fact about children is their dependence on us as adults to create the sort of society in which they can grow to maturity as loving and mature human beings. I am afraid that unless politicians and governments take some steps to leave a mark by way of concrete practical proposals on the statute book and administrative action, the whole year will evaporate in a series of sentimental happenings which leave no permanent imprint for the betterment of our children. I intend to take this United Nations Declaration of the Rights of the Child, which was adopted by the United Nations on 20 November 1959, and, looking at some of the 10 principles there outlined, reflect on the situation in Australia.
May I firstly take principles 6 and 9. Amongst other things, principle 6 states:
The child, for the full and harmonious development of this personality, needs love and understanding. . . . grow up . . . in an atmosphere of affection and of moral and material security;
Principle 9 states:
The child shall be protected against all forms of neglect, cruelty and exploitation.
The major theme of 1979 must be to secure the child against gross maltreatment within the home, the very area in which a child should expect security and affectionate nurture and protection. There are powerless, voiceless children in our society who have been battered and sexually molested, and the community needs to bring this to its consciousness so that programs may be devised to deal with this tragic situation. I am not speaking in some abstract sense. One reads constantly of this sort of thing, as in the Examiner of 1 8 May of this year:
A Hobart paediatrician claimed yesterday that there was an epidemic of child abuse in society. This was causing physical injury, neglect, emotional deprivation and even death.
I notice that the Leader of the Opposition in the Senate, Senator Wreidt, has entered the chamber. It is well known from his contributions in this Senate that he has been most concerned about the physical disciplining of children within our educational system. I believe that that is only one instance of a general phenomenon in our society where violence is used against those who are the most defenceless and the most vulnerable- our children. I was told of a case in Hobart recently where a father, in order to cure a four-year-old boy of wetting the bed, placed him on the hotplate of the electric stove and seared his skin through. Unfortunately, that is by no means an uncommon event. Even in the resplendent isle of Tasmania about 100 such cases occur every year and are reported to the Child Protection Assessment Board, and even that number may be only the tip of the iceberg. Perhaps in Tasmania, with our smaller community, there may be fewer instances of battering of children than occur in the large anonymous cities of the mainland. It may be that very many cases go unreported simply because of ignorance of the easy steps which can be taken to alert a social worker, a teacher or a medical practitioner of suspected battery of this type without fear of defamation proceedings, which certainly are available in Tasmania, and I have no doubt in other States. One should pay a compliment to the innovative and largely successful work of those agencies in the various States which have grown up to deal with cases of child abuse.
I am sure that all honourable senators will be as grieved as I am to know that any Australian child is subject to such battery, such physical abuse. We have to devise caring mechanisms which can alert us to situations where a child is really at risk. Luckily, medical research has indicated to us various criteria, which I will not detail but which can indicate to the family doctor, to a social worker or perhaps to the principal of a school that a child is at risk. There are indications in the mother-child bonding at birth. This has emerged as perhaps the most significant event in determining whether a child will be subject to physical abuse by the mother. This contact, this loving bond, has to be established as soon as possible after birth. I am told by medical practitioners that breast feeding is also reemerging as a most significant factor in establishing the psychological and nutritional well-being of the child in its relationship with its mother. As a bachelor, of course, I speak from books and conversations that I have had.
– With ambitions.
-With ambitions. Let society encourage these various steps immediately after birth and in the early months of nurturing, and I am sure we will go a long way towards establishing bonds which will prevent subsequent abuse.
But let us assume that a child really is at risk. What can the community do to support the family concerned? I emphasise both parts of that sentence: What can the community do to support the family concerned? The object must always be to maintain that family unit, however fragile, however desperately close it may be to breaking up. This may require removing the child from the family for a time.
The agent for achieving a reintegration of the family must be the community itself. In a sense it is no good relying on something that is considered to be totally inadequate and incapable of working if total expectations are laid in paid professional social workers. Case loads are so extensive that social workers have not got the time which is emerging as the essence of the healing process in those families which are fractured and where the child is at risk. We need caring networks such as that established by Lifeline in Hobart, say, where 10 volunteers are trained under one social worker to go out, be with and talk to the bereaved, the chronically ill and the socially isolated. It has emerged that in cases where a child is at risk of battery by the mother in particular all that is needed is a woman who herself bears some of the battle scars of bringing up a family- perhaps her children have now grown up- and who has the time for the endless cups of tea needed to help the mother come to an understanding and to experience, perhaps, the love and affection from that older woman who bears the battle scars, so that the mother in turn can show some affection and love towards the child at risk.
We need to ensure that funds from governments support those voluntary organisations which are prepared to tap that tremendous resource in the community and make it available for these families at risk. Also needed is the free installation of a telephone in those homes where a child has been battered or where the risk of battery is apparent. I totally support this. Many instances exist where, with access by the telephone to friends, relatives or the family medical practitioner, a crisis situation can be, if not resolved, then moderated. The cost of installing such a telephone would be infinitesimal compared with the social cost endured and borne by society eventually when a battery occurs and where medical and social treatment is required for the child and the family. People must be able, in a crisis situation, to pick up a telephone and seek to talk with somebody whom they trust. As to the second type of child abuse- the sexual- I intend to say a few words about incest. There is no doubt that incest is the most prevalent form of child abuse in Australia. The situation is highly inimical to the family unit. As the Evatt Royal Commission on Human Relationships says on page 224 of its report:
Incest is highly disruptive of the family unit. Not only does it impair the individual’s capacity for general social relationships but it also disorganises the relationships within the family, leading to a confusion of roles.
There is no doubt in my mind that society must express its view by retaining incest within its criminal codes. I totally oppose those who suggest that this particular offence ought to be removed from the criminal codes of the various States or Territories. Incest ought to remain as a crime, as an expression of society’s opinion. But I moderate that view in this sense: It should be remembered that there will be occasions when a girl in her young teens perhaps will have to recount in a formal way three or four times in the legal process the incident or incidents with her close relative. This could lead to a situation of a father, say, being convicted, shame being brought and, if the father is imprisoned, further fracturing of the family. In many cases because of the dominant psychological position of the father, the girl may have formed quite an affectionate relationship with him. The actual trauma of going through the various stages of the legal processes leading to resolution by the courts can, in fact, have a far more damaging psychological effect on the girl concerned than the incident itself. It may be that in those instances where a panel of a senior police officer and a social worker determines that that might be the case, the Attorney-General should be able to exercise a discretion to have the matter dealt with outside the court system. I take it that it would be a fairly isolated situation where that discretion would have to be exercised.
I raise this aspect only because I find that people will not admit that sexual abuse is the last frontier of child abuse. Mr Ray Willich, who is the Superintendent of Allambie, a Victorian Government receiving centre for wards of state, has published a notable book called The Troubled Ones about emotionally and physically battered children. He draws on his experience at the receiving centre. Based on his own experience and on projections of United States figures, he believes that probably 20,000 Australian children are abused sexually each year. About 3,000 of these would involve father-daughter incest. As he says:
This is the last frontier of child abuse.
He goes on:
While protecting children from physical abuse has become a priority in modern society, protecting them from sexual abuse is far from our collective conscience.
It is the need to activate that collective consciousness that impels me to make mention of that particular abuse of children tonight. The United Nations Declaration of the Rights of the Child states that a child is entitled as of right to a situation of moral and emotional security.
– The same as an adult.
– Yes, equal with an adult. The declaration states that the child is entitled to be protected from cruelty and exploitation. One can think- perhaps we have been blessed in our families- that this is not applicable to an affluent and easy going society like Australia and that those rights do not need to be fought for and secured on behalf of our children; but, in fact, they do. It is necessary that we, particularly as politicians with an ability to change laws where necessary and to speak in public forums to change public consciousness, speak of these things. As unemployment grows and as more male breadwinners find themselves trapped, as it were, back at home in a situation to which they are unaccustomed with small children under their feet hour after hour- these people are low in self-esteem because of lack of employment and are frustrated- they will take out their frustrations on the small children who are under their feet. This has occurred. It is shown from statistics in the United States. I have no doubt that the same picture will emerge as statistics are gathered in the face of growing unemployment. This is even so in a situation of static unemployment where certain people suffer long term unemployment.
Let me point to another right only briefly as I understand some other honourable senators probably will speak on this matter. Principle 7 speaks of the right to receive an education. I will not dwell on this matter except to say that what is worrying people around the community is, no doubt, the formation of the outlook of our children. This is what education, after all, is all about. There is no doubt that there is a general awareness that it is not schooling any more, that it is not even the peer group. It is certainly not parents or the church which dominantly is forming the outlook of our children; it is the ubiquitous television. It is that to which our children are exposed hour after hour. As Senator Davidson’s committee reported to this Senate some time ago, even the average viewing for an Australian youngster is three hours per day, seven days per week, 52 weeks of the year- well over 1 ,000 hours per year. It is far more than any other activity apart from sleep, if we can call sleep activity.
– Conscious activity.
– Conscious activity, I thank the honourable senator. What I am trying to say is that it consumes more time than any other conscious activity- certainly far more than schooling or exposure to parental guidance. I have no doubt that Senator Davidson may wish to say something about this new technology. We have never, in our society, adapted socially quickly enough to technological change, and television is of course no exception. The right to education, therefore, certainly cannot be guaranteed to a child simply by ensuring that it has a certain number of hours of schooling of a certain quality. Education is much wider than schooling, as we all know, and as I say the major formation of our children is taking place perhaps in television studios, out of the control of school, parents, and other social influences. But I will leave that to some other senator to comment upon. The preamble to this Declaration of the Rights of the Child says, amongst other things: . . the child, by reason or his physical and mental immaturity, needs special safeguards and care, including appropriate legal protection, before as well as after birth.
I want to reflect on that call for special legal protection of children before as well as after birth. Perhaps I could deal with the situation of small children and youngsters in relation to the legal system itself. Here I want to remark briefly on the need to protect youngsters from the improper processing within the legal system, amounting to harassment in many cases, which in some instances takes place at the hands of the police in the conduct of their investigations. Let me just bring to the attention of the Senate, so that honourable senators do not think I am just being theoretical about this, a case commented upon in the Bulletin of 16 June 1978 concerning a 13- year-old boy called Peter who was in a home for young people. He was not a ward of a state home but he had been removed from his mother’s care, although she was in daily contact with him. The police suspected this young fellow of being involved in a Fagin-type gang, breaking and entering into homes and stealing, organised by an older man.
On a particular Wednesday, two detectives in a police car arrived at the shelter where the boy was. This was at 9 o’clock in the morning. He was taken back to his local police station where the same detective as had inquired about these crimes before was waiting to question him. The questioning went on for five hours, the mother not being informed, before the detective gave him a doughnut and half a sandwich, and then ate four rolls in front of him. He was given nothing to drink. At one stage he was taken out in a police car to several of the houses which he had broken into. In the afternoon the questioning ended and he was locked in a cell. He stayed there alone until it was dark. Then he was taken out and the questioning began again. He was put in a police car and driven to two more houses, and eventually he was told that if he was truthful he would be given some chips and coke. It seems that he was truthful because he wrote another statement and got his chips. Shortly before 1 1 p.m., after being with the police since 9 o’clock that morning, he was taken back to the shelter and the police had their case sewn up. At no stage had the mother or any adult friend been notified that he was in that situation.
– It sounds just like Queensland.
– I would not confine this happening to any particular State, but in fact that was a situation in Sydney. I believe it occurs from time to time probably in many jurisdictions throughout the Commonwealth. The question is, even if it occurred only once, how to remedy the situation. It is true that many police regulations and arrangements do encourage or seemingly require the police to notify parents or adult friends when a child is taken in for questioning. But those regulations are not always honoured, and therefore I think it is incumbent upon Parliaments, by enactment, to ensure that children are not questioned in circumstances such as I have outlined. The Tasmanian Parliament expects shortly to have introduced a Bill on criminal investigation which, amongst other things- and this emerged from a committee of which I had the privilege to be Chairman- will stipulate that when a child under 16 is under police restraint, his parent or guardian should be immediately notified, and that no questioning of a child under 16 should take place except in the presence of a parent, relative, adult friend, lawyer, welfare officer or teacher. These seem to me to be minimum requirements in order to secure the child, as the Declaration says, against situations where he is unable to contend for himself because of his physical and emotional immaturity.
If I could speak now of the requirement in the preamble that special legal protection be given to the child before birth, here I simply want to consider a surprising gap which was revealed in our common law system by the thalidomide incident. Honourable senators will recall the incident some years ago when children were born with multiple and gross deformities as a result of the mother taking a sedative, 1 think it was, which had been insufficiently tested by the major drug company which distributed it for sale. In fact, despite all the bluff and the various actions in the English High Court, there was no legal process by which the parents could take that company to court to get monetary compensation for the sheer financial loss they may have suffered in meeting the medical and other expenses in dealing with the child ‘s deformity, and of course no compensation or damages were available for the emotional shock and the continuing emotional situation which that family might face. It seems to me that it would be an elementary but significant step forward if the parliaments of Australia passed laws which would allow damages to be recoverable for injuries inflicted on a child while it was within the womb, that is, injuries which led to its disabling, which was evident upon birth.
- Senator Douglas McClelland played a role in some Australian cases trying to get compensation, as Senator O ‘Byrne would know.
– He probably played the same role as counsel did in England, namely, a semipolitical role where the courts are used in order to build up such pressure that the company eventually comes to a reasonable settlement. But as I say, there is no legal right inherent in the family concerned to recover damages for injuries suffered by the child while in the womb, which injuries become manifest upon the live birth of that child. The law may even go further, of course, and it would need to be considered whether negligent action by some third party resulting in such an injury ought not to permit a claim in damages. There is the simple straightforward case, of course, of the negligent driver who injures a child while it is within the womb of the mother, in other words, a pregnant woman who is herself involved in a car accident due to the negligence of another person, and the child is born suffering manifest injuries caused by that accident. That is a simple case, and I know that the common law is moving to give damages in that instance. There are harder cases where perhaps the mother herself has been negligent in exposing the child to the possibility of injury by continuing with some drug which has a deleterious effect on the child, whether it be a hard drug or aspirin or alcohol, all of which, as we all know, do have a deleterious effect on the foetus and can result in the child ‘s being born with some illness or propensity for weakness. There are many instances of mothers continuing to expose themselves to diseases. I am not speaking of the unfortunate, sad incidents when that happens quite accidentally; I am saying that perhaps the law should look at the situation of a mother continuing to expose herself to a situation which will result in an injury to the child. I was shocked to go into a ward of a maternity hospital- Gore Street Hospital, which Senator Walters will know well- in Hobart to see young girls, within 24 hours perhaps of giving birth, smoking so heavily that the room was just filled with cigarette smoke. Yet one knows that that has an adverse effect on a child.
– Would you include marihuana in that?
– I would include marihuana. I had hoped that Senator Walters would not raise that matter, as she did in a letter to the Examiner when I was abroad. That was brought to my attention today. I would include marihuana if it were established that the taking of marihuana by the mother had a deleterious effect on the foetus, in the same way and to the same extent as I am speaking of her negligently, blameworthily taking any drug which affected the foetus. That is entirely consistent with my speech on marihuana to the Senate in which I said that whilst the social and recreational use of marihuana by a person should not attract a criminal penalty, criminal penalties should be retained when the taking of marihuana is combined with, for example, the driving of a motor vehicle or the using of industrial machinery where that could have a harmful effect on others. So, if it is proved that the taking of marihuana by a pregnant mother has a harmful effect on another, namely, the child in the womb, I would only be consistent- there is no question of my being inconsistent- in saying that my principle would apply, that perhaps we should be thinking of introducing legislation which makes it clear that the mother has a duty of care, which the community will enforce towards the child within the womb.
What I am trying to say is that at the moment, given the fact that the law does not provide for compensation for children injured while within the womb, we have hundreds, perhaps thousands, of literally born losers coming into our community without receiving the financial compensation which might make their growing into maturity somewhat easier on their parents and families, who have to support them with their deformity or injury. Therefore, I feel that in order to fulfil the requirements of that part of the preamble, society ought to be looking to its statutes.
I had intended to touch on the international dimension. I refrain from doing so because of the time and because some other senators may wish to speak on the matter. I have probably spoken for too long in any case.
– You have plenty of time.
– You have been quite interesting.
– As I have been encouraged to continue, I refer honourable senators to Principle 3 of the Declaration of the Rights of the Child, which states:
The child shall be entitled from his birth to a name and a nationality.
That passed me by when I first read it, but Principle 8 states:
The child shall in all circumstances be among the. first to receive protection and relief.
On reading those principles together, the penny dropped. Who are the children around the world without the protection of any government, effectively without any nationality, with no government willing to offer them protection and security- the ones most in need, having first claim to receive protection and relief? There is no doubt that the answer lies in the stunted, malnourished children of the refugee camps, whether they be in Malaysia, Thailand, Hong Kong or the Philippines. I hope that the emphasis in what I have said so far, in considering the children in our own backyard, will not be misinterpreted as a selfish concern for our own children.
- Senator, would you say that the orphan children in Latin American city slums would be included too?
– It is a world-wide problem. I am thinking, though, that in Australia what politicians need to do is to devise programs and to allow programs to be devised by voluntary groups which enable us to do what we can do, perhaps what we ought to do, because of the physical contiguity of the people in the refugee camps of South East Asia. Of course, we can be concerned about and try to ameliorate conditions in South America, the Indian sub-continent, Africa and other places, both by way of sending relief aid and by supporting organisations striving for internal social justice in the countries concerned.
– We could also pressure those governments which still practise child slavery.
– Another good point is the fact that regrettably, as the International Labour Organisation has pointed out time and time again, but more recently in this Year of the Child, child labour is still a very widespread practice in many countries. It took a Dickens to alert the Englishspeaking world to the plight of children in sweat shops, which he had had to endure while his father was in the debtors’ prison. It took his pen, dipped in memories of his own experience, and his compassionate writings to alert the Englishspeaking world to the plight of those children. What we need is another Dickens to arise and expose, as Senator Puplick has pointed out, the plight of those children who are still in a situation of slavery in other cultures of the world. As I was saying, my remarks perhaps have concentrated on the child in our own backyard. Perhaps that is not a bad thing really because who are we to preach to those other countries if we have not remedied situations in which children effectively are deprived of their rights within Australia?
– What about Aboriginals?
– 1 hope that Aboriginals will be spoken of by some other honourable senator if the opportunity presents itself. If I may, I will come to the end of my remarks. I did not wish unduly to dwell on the more vulnerable and depressing aspects of being a child. Thank God, that is not the total story and perhaps it is not the story at all in the case of many, if not most, of our Australian children. But I reiterate that I wished to make these remarks for the reason I outlined in my opening remarks, namely, that there is no cause for complacency. This year must not be allowed to fritter away in sentimentality, celebrations, events and competitions with which we all as politicians have been associated during this year. We need to leave a mark on our statute books, in our laws, in our administrative arrangements, in our very practicable, constructive, concrete encouragement of voluntary organisations, whereby the rights of children as outlined in the United Nations Declaration are indeed secured. Much has to be done. I have no doubt that the goodwill and the energy of Australians will ensure that it is done.
-The Senate is indebted to Senator Tate for putting on the Notice Paper his motion, which reads, in part:
Senator Tate in his remarks outlined for us in a very helpful way something of what flows from the ill treatment of, lack of consideration for, lack of love, care and affection for the world ‘s children. He pinned his argument to the details of the United Nations Declaration of the rights of the Child. We are among the many nations which are committed to the various declarations by the United Nations. Therefore, I think that we have a responsibility to be involved and interested in those declarations and, in particular, in the kinds of matters to which Senator Tate referred tonight. It seems quite incredible that in our world, with all its advantages of communications, technology and education- with all the great advances which have been made in recent years- we still have a situation in which a senator of the Australian Parliament can stand in his place in this chamber and outline such conditions, circumstances and cruelties, which we know do exist. It is no credit to humanity and certainly no credit to mankind. So the matter before the Senate tonight is of universal interest and attracts a general and sympathetic response.
There has been some emphasis on a particular kind of child who is suffering from a range of disadvantages, but there are all kinds of children in all parts of the world living in all classes of society. During the course of my remarks I do not propose to go over the kind of things to which Senator Tate this evening drew the attention of the Senate when he urged all Australian governments to do certain things. He would not be surprised if all Australian governments- and maybe our own Government in particular- listed the kind of things that they were doing for children. Surely the purpose of Senator Tate’s exercise was not to have a controversy and an argument as to what is being done by one government, what is not being done by another and what might be done by yet another. Rather he draws attention to the needs of the child, here and everywhere. The needs of the child, of course, are manifold. The needs are social, medical and educational and they range over the whole area of looking after, caring for, being concerned about and being concerned for a child who has no one to have any concern for him.
As everybody knows, I am privileged to be Chairman of the Senate Standing Committee on Education and the Arts. Believe it or not, the majority of my exercises as Chairman of that Senate Committee have dealt with the needs of the child. We have dealt with the needs of isolated children and with the needs of children as far as television is concerned, and we are about to start on the needs of the child with regard to aspects of literacy and numeracy in his vocation. Because one has engaged in those particular exercises, it would be an impertinence on my part to suggest that they have applied themselves to the needs of a child and thereby have made a contribution to the International Year of the Child. That would be a long way from the reality of the situation. Nor does one enter into any area of defence by saying that we have done these things. Rather I suggest that in these particular exercises we have engaged in inquiries which have revealed to us some of the needs of the child, some of the things that need to be done and some of the things that have been done. All along the line we have called for a responsibility on the part of the Australian community and, through the Australian community, on the part of the world community to exercise degrees of responsibility in relation to the needs, desires, hopes, aspirations and opportunities of the child. All of us, whether we have children or whether we do not have children, have a responsibility to see that the next generation of our citizens have opportunities, the freedom to express themselves, the capacity to develop their talents and the opportunity to move into places which the preceding generation leaves so that all that is good in society may be carried on and expanded and all that is undesirable in society may be corrected and, if possible, eliminated.
May I refer very briefly to my first exercise, television in the life of the Australian child. The Senate will recall that a few minutes ago Senator Tate referred to this particular aspect in his speech. All of us know that the process by which a child fits into society covers many areas. It may be described as the process of socialisation. When we look at the children in our midst we know that by learning, whether it be in verbal or non-verbal languages, they will be able to develop their personalities and thereby make their later contributions. We know also that as children stand in our midst they are impressed and influenced by attitudes, values, opinions, skills and knowledge, but there is also the area that the child acquires from outside that circle- the agencies, the schools, the peer groups and the churches. All of those things enable a child to develop as a functional member of society. Of course, amongst these parts of the socialisation process there is television, which is one of the major establishments within our society.
We are influenced by television. From television we obtain information, enjoyment, interest and enthusiasm for what we may be doing. We turn to television also when we have nothing else to do. It is only natural that a child will be influenced by television. As Senator Tate has said, today’s statistics show that a child watches television for something like three hours a day or 20 hours a week. In the hearings which we conducted it was reported to us that there were more than isolated cases of a child watching television for anything up to 80 hours a week. To repeat what the honourable senator has said, a child spends more time watching television than he does in any of his other occupations.
In the Senate we have had a number of discussions on this matter. We tabled a Senate Committee report on the matter. That report was discussed and debated. I do not think that there is a need now to go through those points again. Every one of us here is concerned at the influence that television has on a child. I will never forget my experiences as Chairman of the Committee in listening to the submissions that were presented to us by all sections of our Australian society. Submissions came to us from parents, from educationists, from sociologists and from community leaders, all of whom were extremely concerned at the influence of television on a child. I think of the situation of a child whose family does not have a television set in the home and who at school the next morning is entirely out of touch with the peer group and with what is going on because he has not seen the programs of the night before.
I think of the story told to us by one witnessthis may have been repeated in the Senate before- of the child who would not believe there were such people as women doctors. The mother took the child to a woman doctor and still the child was not convinced. The mother gave the child a book to read about a woman doctor. Still the child was not convinced. The child saw a program on television in which a woman doctor was featured, turned to her mother and said: You are right, there are such people as women doctors’. I think of the child looking through the window at a garden scene, turning to the television set and seeing a garden scene on the television screen, turning again to the window to see the garden scene and then endeavouring to turn off the window. The television became the authority, the friend, the companion, the educator and the influence. The whole style of life of a child is influenced by the television set.
It would not surprise honourable senators to know that a great amount of material was presented to us which drew attention to the effects of violence in television programs upon a child. All of us are familiar with violent programs. All of us are familiar with violence expressed in drama, in films and in other programs, because we are a violent society. I think sometimes we tend to blame television because of its violent programs when, in reality we, as viewers, tend to enjoy a good dose of violence. So it is not surprising sometimes that our children are attracted to and transfixed by a violent program. Indeed, we know from statistics that violence has a very heavy influence on children. However, in referring to this subject we need to accept our own responsibility in these matters.
We are today involved in situations in which there is verbal violence. There is violence in business, violence in the court room drama, violence in the news. All this is a reflection of what is happening in our world, but there is no need whatsoever to put violence before children at an age when we are endeavouring to encourage the development of their intellect, skill and appreciation, their sense of understanding, tolerance and forgiveness, and their companionship with other people. Be it judgment upon us that we are allowing to be portrayed violent programs which, in this International Year of the Child, represent an offence against the needs of a child.
The Senate Committee presented its report in relation to this and a whole range of other things concerning children. We called for a reflection by governments that this was a matter of public concern. We spoke of the reduction in the level of violence in programs and of the influence of television on the learning behaviour of the child. We called for research, for a tribunal, for a whole range of things that we set out in the report. We referred to advertising and its unfair and undue influence on the child. These are the kinds of things to which, in the International Year of the Child, society should be giving some attention.
I refer to Senator Tate’s urging that Australian governments take certain practical and constructive steps and note that there has been some Government response to the report. Of course, it has not been as great as I, as Chairman of the Committee, would have liked, but it has taken the form of a review of the powers of the Australian Broadcasting Tribunal. It is to be seen in the activities of the Department of Health, the Australian Medical Association and the Australian Dental Association in matters of nutrition. The Curriculum Development Centre in Canberra has reported progress on the establishment of guidelines for media education in primary and secondary schools. There have been recommendations in a whole range of areas relating to the harmful effects of stereotyping, the portrayal of unrealistic lifestyles and like matters. Although there has not been the total response that one would have liked, at least there has been an awareness by the public, and indeed by a government, concerning this matter.
I turn briefly to the next area in which I have been involved, as Chairman of the Senate Committee, as far as children are concerned. I refer to the needs of the isolated children of this country. Doubtless most of us think of an isolated child as someone who lives beyond the furthest fences in the great outback, in the great lonely distances of this country, but isolated children are to be found in other circumstances also. There are educationally isolated children who live within an hour’s drive of this building. There are in all parts of this country children who are isolated from one reason or another. This was another exercise in which we took on board the needs of children who did not have the access to educational, cultural and medical facilities of those who live in our urban areas.
Our report has engendered a great deal of interest and concern by a very large section of the Australian community on behalf of those who are described as isolated children. Although there are isolated children in our urban areas, obviously and naturally our concern is concentrated upon such children as live beyond the furthest fences, on the other side of the horizon as it were. In our report we highlighted the work that had been done in various ways on behalf of these children- through the great traditions of the School of the Air, the development of satellite communication for educational purposes, the development of radio communication, the programs which provide living away from home allowances, and the programs concerned with second homes, the programs for upgrading the skills of governesses or teachers in isolated areas. Here again, over some years now governments have indeed responded. Certain programs which have been initiated by the present government and by the former Labor Government have developed facilities for the benefit of the isolated child so that such children not only may be educated, as we understand that word, but also possess an appreciation of society in all of its aspects, all of its needs and all of its opportunities.
As someone who has been connected with the National Library of Australia, I look forward to the time when library, information and related services will be available to all children throughout the country. I foresee that with the advances that are occurring in technology, with the provision of increased funding, and suitable opportunities, such facilities will be provided.
The second part of Senator Tate’s motion related to the suffering among the world’s 1.5 billion children. The honourable senator’s remarks earlier would indicate that he was referring in this context to children who lived outside of Australia and were in particular need. The Senate will know of my interest in international aid and of my involvement with voluntary agencies in that connection. I am not the first to have been invited by various groups in the community to speak on these matters from time to time. One who is involved in international aid inevitably becomes involved in the needs of refugee children. I have had a number of opportunities to speak to groups in South Australia in relation to those needs and since, immediately prior to the commencement of the Budget session, I had a few days which seemed to be reasonably clear of appointments, I took myself privately to South East Asia to look at the refugee situation.
I visited Singapore, Kuala Lumpur and Hong Kong. Thanks to the kind offices of our High Commissioner in Kuala Lumur, I spent a day on the island of Bidong off the east coast of Malaysia- 2 V4 hours travel from Kuala Trenganno across the South China Sea in a rather rickety junk-type boat. I am told that the island is about three times the size of the Melbourne Cricket Ground. It has in the middle a small hill some 900 feet in height and on it were 33,000 refugees. I feel as though I saw them all. I moved among them seeing something of the work that was being done by the Red Crescent, by the United Nations High Commissioner for Refugees and by voluntary agencies from Malaysia. Their story is, of course, quite an intense one and perhaps tonight is not the occasion on which to give the details of it. Of the 33,000 inhabitants, some two-thirds were younger people and they included, of course, a very large proportion of children. I moved through hospital centres, school room situations and a number of social situations, if I may call them that, where children were very much in evidence. There they were being taught English language and English pronunciation. They were being cared for. They were being fed. Their supplies came from the UNHCR in Geneva and were administered by the Malaysian Red Crescent in Kuala Lumpur.
I later saw a similar situation in Hong Kong. Of course, what I saw I had expected to see because I have visited refugee camps in other places and in other days. What I saw did not please me. What I saw was tragic. What I saw worried me because I was concerned at what the future of these small children might be, where they would go, what their memories would be, what influence this would have on their lives, their education and their attitude to mankind, the international world and to their fellows generally. I think that we should be grateful for the work of the international voluntary agencies which at least take onto themselves the responsibility, not so much of solving the situation, but at least of providing the next steps in what is a very tragic and drastic situation. All this had added emphasis when we heard on the radio this morning in relation to the Kampuchean situation that the person visiting one of these camps never saw anybody under five years of age because anybody up to that age had not been able to survive. Fortunately, the nutrition situation that I saw was catching up and children were in reasonably good condition as far as these very unfortunate circumstances were concerned.
I must say that towards the conclusion of my visit which, of course, was a pretty strong experience, I visited an area which is known on the island as the Back Beach. There, running around me, were anything up to 20 little boys, all of them flying kites into the wind. The kites were made out of any material that they could pick up. I returned to my base with some degree of hope in my heart that if a small boy can tug a kite into the wind and look up into the sky he must at least have some aspiration in his makeup and some hope for his own future. The motion which the honourable senator has put down tonight calls for our interest and responsible response in relation to the needs of children in our own country and throughout the world. Children are, of course, one segment of a society which is made up of adults and older people. Our involvement in the International Year of the Child calls on us to have a responsibility to all sections of our community so that not only can they have a hope for their own future and a satisfaction in their own life, but also that those of us who are privileged to have favours and opportunities can share these with other people and thereby be deserving of our place on this earth.
-Like Senator Davidson, I thank Senator Tate for having raised the matter. I must say though that on looking at the motion that Senator Tate moved I am too ashamed as an Australia to talk about the second half of the motion which states:
Encourages every action which might be appropriate to relieve suffering and deprivation affecting many of the world ‘s one billion five hundred million children.
I am too ashamed to talk about children outside Australia such as children in Africa who have been starved and enslaved. As an Australian I am too ashamed to talk about children in Kampuchea and India who have been starved and killed; about children in South America who have been starved, enslaved, left without education and without hope; and about children in East Timor who have been starved and killed and, I believe, abandoned by Australia. I bring to the attention of the Senate the life and the environment of a section of our three million children who are under the age of 1 2 years. Some of these children have never lived at home with their parents, or, at best, they have lived there for a short time. Some of them within a fortnight of being bom went to an institution, and are destined to live out their lives in that institution and never go home. Some have lived in the hospital in which they were born for very many years until, because of the death of another child, a bed has become available in an institution and they have been discharged from that hospital and sent to the institution, the only home that they are ever destined to know. These are the children who in this rich, well ordered Australian community are born mentally or physically retarded.
Some of those children were fortunate enough to go home to a warm, familiar surrounding with parents who battled valiantly to give them some sort of normal life, without any assistance by way of education, health care or relief from the overpowering 24 hours a day, seven days a week problems that they are faced with all their lives. The parents live in terror of their death because they do not know what is going to happen to those children after that. Some of those parents, because of outside pressures, such as pressures of having no work and having other children to look after, have had to let their children go to institutions. I have talked to some of those parents who are appalled and bewildered by what they have to abandon their children to. They are bewildered because those in authority- those people whom they see as being authorities- who should know, say to them: ‘Put your children in this institution. That is the best you can do for them. That is the only thing you can do for them. Because of your other responsibilities you must put your children in this institution’. They are appalled at the institution that they find is available in which to put their children whom they bore, whom they love and regard as human beings. They find they have to literally abandon them to institutions that are lacking in homely comfort, individual and educational care. They are institutions about which, at best, one can say keep those children covered and warm and keep them fed. What they are covered in, what they are fed with and how they are fed leave their parents with great feelings of guilt and of inability to cope.
The parents abandon their children because they are told to do so by people whom they believe should know better. They abandon their children to institutions that in many instances were built for adults in the nineteenth century and are still standing. They abandon them to institutions that are over-crowded. Many of them carry one-third more than the number of adults they were designed for. They are abandoned to institutions where one night nurse has to look after and be responsible for 36 children, some of whom are quite incapable of moving. So one wonders what would happen if a fire broke out in those institutions. Indeed there is one large institution in Melbourne in which helpless children have been living since 1963. At this moment it is having a fire prevention system put into it which can deal with fire were it to break out. So we have lived on the edge of a razor blade there. They live in institutions in these sorts of conditions, without these sorts of health and life preservation systems. In some areas there are 30 centimetres between the beds and, I remind honourable senators, there is one nurse to look after 36 children. They live in institutions where there is no privacy, where there are toilets without doors and where there are communal bath facilities. In one institution it was reported that young girls in mixed wards with no toilet facilities had to use small aluminium pots in the day room.
This is the sort of dignity that our children are left with, that they are abandoned to. They live in institutions where they have no private rooms of their own to live in; they live in large communal dormitories, and they sleep in small iron baby cots that were designed for children up to the age of 18 months. They have no clothes of their own, they are dressed from communal wardrobes. Is it any wonder that their parents live in despair and fear, and hate themselves for what they have done to their children? But the governments of this country offer them nothing else. There is little or no education for these children and there is little or no training of any kind for them. I suppose one can say that in the sort of society in which we live today there is not much hope for bright children who have gone through school, have passed their exams and have done well but who still do not have much of a future and will not have a job. Those children who the community assesses as being permanently retarded may lead the community to say that it cannot afford to waste its resources on them. What if a child is not mentally retarded but physically retarded; he is physically retarded but fully intelligent, inside a stupid body that will not work, trapped inside a body and inside an institution?
– You need Rosemary Crossleys
– As the honourable senator says, we need Rosemary Crossleys There is a small group of children, about whom I have talked before in the Senate, in the St Nicholas Hospital for the Retarded in Melbourne. In that hospital there was a little girl, Annie MacDonald, who was put there on the advice of the people who should know- her parents- when she was four years of age and who lived there for 15 years of her life. Annie MacDonald had to go to court to get permission to leave that hospital. She had to prove that she had enough intelligence to be able to exist outside the hospital. A neutral assessor was asked to report to the court on Anne MacDonald ‘s intelligence. He reported in this way:
Her concentration was very good indeed and she received instruction extremely well and retained those instructions quite well. Questions to her were at times quite lengthy but she attended well and carried out all tasks with efficiency and accuracy. Her powers of concentration and attention were extremely good and her memory also was extremely good.
I remind the Senate that this is a little girl who has cerebal palsy and who, when I first met her, could not control the movements of her arms, legs, head, tongue or eyes and yet in those 15 years she had lived in this institution she had learned to communicate with other people by means of moving metal letters on a board. At times it seemed that she did that with a great deal of difficulty because of this uncontrollable movement. This is the little girl on whom the psychologist is reporting in these terms:
In fact, her performance was errorless on the sample questions and the pro rated verbal IQ so derived was found to be 1 10, that is, above average- whereas the non-verbal pro rated 1Q was found to be 101.
The overall estimated IQ was found to be 106. It could well be that with further hours of testing, in view of the slowness of the alphabet board method, she could achieve even higher IQ functioning.
There is no doubt however that she possesses a verbal IQ which is above average at least and that she is capable of quite sophisticated forms of communication. Clearly, she is capable of giving quite sound and logical instructions to her legal advisers. Examples of her rather sophisticated responses included the knowledge that the population of Australia is 13 million- that is within the acceptable range of a correct response- that water boils at 100 degrees, that one travels in a north-easterly direction from Adelaide to Brisbane. As quickly as the examiner delivered a question in relation to the price of a certain item in that two such items would cost 31c what would be the price of a dozen, she recorded the figures of$ 1.86.
In giving difficult single word answers to a verbal abstraction similarities task, she was able to specify that a dog and a lion were alike in that they are mammals. Furthermore, in referring to the similarity between an eye and an ear, she said they were sensory organs. Her vocabulary was quite sophisticated. She knew that the word impale meant to pierce, that reluctant meant unwilling and when asked for a single word to describe compassion, she indicated, through her alphabet board, the word ‘sympathy’.
Following observation, communication and appropriate and comprehensive intellectual testing of this person it is concluded that she possesses above average intellectual strength at least with potentiality of intellect extending even further. She is a rational person of sound mind who is capable of giving quite adequate instructions to her legal advisers.
Annie MacDonald had lived in an institution for 15 years without any education. Whatever she had learned, she had learned by observation, by watching television and listening to people. She had been surrounded by people who thought that she was a vegetable; she had been surrounded by people who in front of her talked about the fact that she would not live long. They anticipated when she would die, thinking- as so many of us do- that because people are retarded, they are also deaf. It was not until a lady named Rose Crossley came to work at the hospital and saw some gleam there, some glimmer and some desperate attempt to communicate with somebody, that she was able to set up a very rough form of communication with letters on a metal board being moved around by a hand and arm that found it very difficult to move in the direction in which her brain said to move.
In all that time, Anne MacDonald had persevered, had stayed alive as a person and had achieved that sort of intellect. What haunts people like Rose Crossley and Anne MacDonald is how many others are buried in institutions around Australia; how many others are imprisoned in stupid bodies inside institutions because we are too lazy or do not care enough to try to find the people inside those bodies. What could be done if the governments really were concerned about children and found the Anne MacDonalds long before they had existed for 14 years in those sorts of conditions.
I have talked before about Anne MacDonald and a small group of children at St Nicks, but there have been other children at the hospital, children who were not lucky enough to be close to Rose Crossley and were not lucky enough to have somebody draw them out. Another little boy was supposedly born with what seemed to be mental retardation and because his parents were not physically strong people, the doctors advised them to put him in St Nicholas Hospital.
But they were loving people and they kept up a close association. They pestered people until they got him into a day centre outside the hospital. He would go to that day centre and return to St Nicholas Hospital to sleep at night, and his parents would take him home to their flat at the weekend. After a little time they thought that that was ridiculous; they could have him at home with them and be a family again. They told St Nicholas Hospital that they would like to take him out of the hospital and take him home where they could live as a family, and they would take him to the day centre. They received a similar response from this hospital to that taken from an example of another family, who wrote the following letter:
Two weeks back we advised St Nicholas of the day of discharge, the 15th June 1979. Nothing whatever was done to support or encourage us by the Staff. On 1 5 June the boy was examined by a new male doctor who had never set eyes on him before that day. The sister of the ward had just been appointed to her position and was openly hostile in her attitude towards us. We were not permitted to sign the correct document but only the usual weekend paper. At the last moment we were brutally informed that the Superintendent Psychiatrist did not want our boy removed from the Hospital but he refused to see us and would not say why, even though he knew three months ago of our intention. What upset us most was that after six years as a patient, no one turned up to farewell him. However, we took him out and nothing on this earth will make us take him back.
That parent, in a letter to me, seemed to sum up in these words what so many parents feel about children in this sort of situation:
As we see it, everything hinges on one essential factor. The question which should be asked and constantly kept under review is this: What conditions exist to promote and advance the personal and social self-esteem of each mental patient? By way of contrast, consider the treatment of a criminal convicted by law and imprisoned for his offence. He is fed, clothed, housed, shut up and never allowed to forget, even after his release, that he is under surveillance. We believe that the readiness of a growing child with cerebral palsy to improve physically, mentally and spiritually, really depends on the freedom we give him to form a constructive selfimage as a person in his own right. If we deny him that freedom by the many forms of bastardisation prevalent in State Institutions then he has no other possibility but regression bom om of hopelessness. In that case the ancient Greeks were logically perceptive in exposing unwanted and deformed kids, by leaving them to die on the nearest mountain.
In that lies a lot of sense. If we do not care about these children, if we do not care about the quality of life they are going to live, why do we let them live in the first place? That is how parents feel, but who is to help them? In Victoria we have large charity appeals to provide facilities for these sorts of children but much of the money that is raised by television appeal, by all sorts of razzamataz, goes to public relations firms. We do not look after the severely retarded children with that money, we look after the children that can be accommodated socially. The severely retarded children, the children with whom there are real difficulties of communication and assistance go to institutions. The State abrogates its responsibility to educate all children. It educates the children that are easy to educate. The Premier of Victoria was fronted with this problem some years ago. In September 1978 Mr Hamer, the Premier of Victoria made this public comment:
Elsewhere children moderately or severely handicapped arc regarded as a health or mental health responsibilityVictoria regards them as trainable and educable.
That is so much malarky. Victoria does not regard them as anything but a liability and there are not too many other States in Australia which regard them as anything else but a liability. They are not trained, they are not looked on as human beings. They are shut away now as much as they were ever shut away in the dark ages. They are shut away and forgotten and the authorities hope that the world will not raise the subject.
The State department in Victoria continually cries poor mouth. If you raise the situation of these children it says: ‘Oh yes, yes’. It knows that something should be done but it has not got the money and can never find the money. At the moment in Victoria the parents of 80 severely handicapped children whom they find it very difficult to cope with physically can find no places and there are no services in the community to assist them. But wards built in Victoria as long ago as five years in at least two residential institutions have never been opened because of lack of staff. There are 30 graduates at this moment available in Victoria that the Victorian Government will not employ. Graduates from a certificate course specialising in mental retardation have been forced onto the dole or into other jobs because the Health Commission could not find them work and would not find them work. The 30 graduates have not been employed by the Commission even though they have a letter from the Premier, Mr Hamer, promising them jobs. This is despite a critical shortage of staff in Victorian mental institutions and for community support schemes. The course that those graduates did is estimated to have cost the Government about $60,000. It was $60,000 wasted. There are 80 children outside institutions and innumerable children buried in institutions for whom governments will do nothing. One of the interesting facts is that maybe many of these children should not be in institutions at all.
The South Australian Government, which has been mentioned in this Senate many times this week, not always in a very truthful way, cared about these handicapped people. South Australia went out to see what could be done for handicapped people. It found that many handicapped people wanted independent normal lives. It found that not only did that mean that they needed help, care, education and assistance; it found that if those services were provided independent people could achieve normal independent lives. It found, as governments in other parts of the world have found, that not only did it bring human beings into the world but that it was very much cheaper than burying people in institutions. One asks: Where is the vision, care, love and positive thinking that might lead to the solutions that will bring people out of that dreadful twilight world into the world we know?
Amongst children who are mentally retarded is the group that most people know, mongoloid children; children who suffer from Down’s syndrome, children who have been written off for years as being impossible to educate, impossible to use in the world. We have had to put up with them and generally put them in an institution. There is a doctor in Victoria, Graham CluniesRoss, of the Preston Institute of Technology, who has been working on a project to accelerate the development of Down’s syndrome infants and young children. His report on this work states:
Developmental progress data are reported on 36 Down ‘s syndrome infants and young children who have been involved in an early educational intervention project for between 4 months and 2 years. The project incorporated parent training and home-based instruction as well as centre-based instruction. The development of all children was accelerated, with achievements at and above normal levels being attained in several cases. Younger children were particularly advantaged by virtue of entering the project with higher developmental-quotient scores, and they progressed at least as rapidly (in some cases more rapidly) than older children.
I want to pick out the most interesting parts of this report. It states:
Included among the requisite components are: Commencing intervention as early as possible in the child ‘s life; involving parents in their child’s education; using a structured framework for curriculum design and teaching; formulating curriculum objectives around normal developmental sequences; conducting frequent criterion-referenced assessments of performance and using these data as a basis for decision making; having the program implemented by an integrated inter-disciplinary staff team: and providing follow-through programs for children as they advance beyond early intervention.
This doctor worked along these lines because he found that in other parts of the world outstanding results were being attained. Outstanding results have been reported from the program for
Down’s syndrome infants and children conducted at the University of Washington. Children who have been in the project for up to five years are reported as having advanced to a level where they are achieving 95 per cent of the tasks expected of normal children of similar chronological age. This contrasts sharply with the typical pattern of development in Down’s syndrome children reared at home in apparently normal family circumstances but without the benefits of early educational intervention. That is one area concerning mentally retarded children that we have wiped off. It is one area that shows some hope that these people have something to offer to the world, that there can be some sort of breakthrough.
Recently in Melbourne newspapers a report appeared about a Dr Anthony Buffery, a 29- year-old paediatric neuropsychologist who has recently been appointed senior lecturer in psychology at Melbourne University’s Austin Hospital Clinical School. He would like to see brain damage and the emotional jolt that goes with the term disappear from the popular vocabulary and cruel labels such as ‘cabbage’ and human vegetable’ regarded as obscenities. He poses the question: Can the circuits of the human brain be re-tuned like those of a hi-fi set? As circuits of a hi-fi set can be patched up, it might be possible to teach the brain to use different circuits to handle the work of an afflicted area.
It is really depressing when one moves into the world of the children in this twilight zone to find no government intervention, no government research programs, no government programs to search out answers to the problem of why these children were put in this position in the first place, no government programs to assist them when we do find that they are in the position of being retarded. We need direct government assistance to accelerate research in these areas, to open up mental health institutions to new ideas and to education, to bring these people into a world of normal living. The Federal Government, through its Minister for Education, can grant money for research in these areas. The Federal Government, through its Minister for Education, can ensure by means of specific purpose grants that education programs are commenced in these institutions so that the children can give to the world what they have to give.
Back in 1977 there was a great outcry in Victoria about ‘ minus ‘ children, the children in institutions who were not as normal as other children. A report was called for and prepared, but unfortunately that report is now called the lost report. It was presented in 1 977 and has gathered dust in government pigeonholes ever since. The report, which was on the plight of Victoria ‘s mentally retarded children, was prepared almost three years ago by a 12-member governmentappointed committee comprising doctors and specialists in social welfare and treatment of the handicapped. It has never been released to the public, never been debated in Parliament, but nevertheless it is worth quoting. Its description of life inside a government home for mentally retarded states:
Our residential training centres are an indictment on the people of Victoria.
A typical ward in one of these institutions consists of a large dormitory with no privacy, a day room in which all activities have to take place, very often including eating, and inadequate and public or semi-public toilet bathing facilities.
Bathing is often on a scheduled, mass-production basis with residents lining up naked at one end and emerging, in varying degrees of cleanliness, at the other.
Most residential training centres in the State are surrounded by pleasant and spacious grounds . . . these grounds are seldom used . . . largely because of staff shortages and the degree of supervision that many of the residents require.
The report stated that there were insufficient chairs for the residents and seating might consist only of two or three hard benches. It continued:
Beds are often cold and uncomfortable . . and . . . small: in many instances beds have to be small to crowd sufficient into space available for the number of residents.
Residents often suffer severly from the cold.
That is Victoria’s lost report, a report that was made in 1977, a report that has never been acted upon, a report that condemns people to limbo. This week the Acting Director of Mental Retardation Services in Victoria, Dr Rosemary West, resigned. As reported in the National Times, these are the reasons Dr West gave for her resignation:
Residential institutions are hopelessly overcrowded and understaffed.
Most of the institutions are about 100 years old and arc massive fire and health risks.
General hospitals and other institutions are forced to take mentally retarded people because there is no space elsewhere.
Wards built as long as five years ago at two residential institutions have never been opened because of lack of staff.
People forced out of institutions because of lack of room are often dumped in privately run special accommodation houses where the conditions are frequently horrific.
Mentally retarded people are assaulted by staff because of enormous stress the staff are forced to live with.
An expert report to the Premier two years ago has been ignored. Action has been taken on only one of its recommendations- the major one. The Government rejected the committee ‘s advice that an Office of Mental Retardation be created as a statutory authority. Although the Premier,
Mr Hamer, received the report in August 1977, he has not yet tabled it in Parliament.
Despite a decade of rapidly increasing and, by 1979, virtually total acceptance of the report’s guiding principle- letting the mentally retarded live as normal a life as possible- very little has been done to translate this concept into practice. 1 say again that the horrific part of that report and of the whole scene is that there may very well be people in those institutions who are not mentally retarded, who are as well versed and as intelligent as the members of this Parliament- I might be cynical enough to say ‘as intelligent as even members of this Parliament’- who are locked into that situation and whom nobody will rescue. Long ago in this Senate, following me in a debate, Senator Kathy Martin said of me: ‘We could have set Senator Melzer’s speech to music’. I took that to heart, and in this speech I have tried not to dwell on the purple prose, not to point out in emotive phrases the terrible life that children in this area can live, but to give some evidence of the lives they live. It is no longer the time for music. It is no longer the time for tears. The tears have to be turned into action, and this Government has to show solid plans to bring these children into the real world.
-I rise to speak briefly in this debate and to express my support for the motion Senator Tate has moved. I am sorry that I did not hear all of his speech, but I am sure that it was a very sincere and constructive speech. Obviously it was directed to two aspects of a motion which seemed to me to be highly desirable for this Senate to support. I must join issue slightly with Senator Melzer, who has just spoken. I will not endeavour to set her speech to music but I will endeavour to suggest that perhaps the matter she first raised is one that was not a wise argument. I refer to the argument that she was ashamed to speak with people abroad- I think I can paraphrase it in this waybecause of our lack of action in regard to children in our own country. I put it to Senator Melzer that, just as this motion does not take that point of view but runs directly contrary to it, in fact that is not the attitude we should take. The motion very clearly is expressed upon the basis that we should take practical, constructive steps in regard to our three million Australian children and that we should be concerned with the 1 ,500 million children throughout the world. I believe that this argument often crops up. People constantly ask: ‘Why should we do these things for Asians, for boat people and for people abroad? What about our people at home?’
– I did not mean that.
-I know that the honourable senator did not use that argument at all. I am saying that it is very often easy to get something which is very close to that argument, whereas, in fact, our obligation obviously is strong abroad and at home. I will not be disagreeing with Senator Melzer’s view in regard to the children in Victoria. As she knows, I am very aware of the situation and of the matters about which she has spoken tonight. She spoke earlier on 4 June when I was absent. I read that speech with a great deal of interest. I know Miss Rosemary Crossley and admire the valiant effort she has made with the children in the hospitals in Victoria about whom Senator Melzer spoke. I have no reason to doubt, from the material in my possession, the truth of any of the matters which Senator Melzer has put before the Senate tonight.
I have been endeavouring now for some time, as Senator Melzer knows, by way of communication with Federal and State Labor Party and Liberal Party members in Victoria to encourage a greater interest in this matter and to try to get discussion with the Ministers concerned to see whether something can be done. I believe that Federal moneys can certainly play a role. I believe that what Senator Melzer has said about the children in these hospitals- she referred to the suffering and the ways of living and also to the unsatisfactory nature of the hospitals- to be accurate. It accords with the evidence that I have been able to accumulate. I believe that a number of these children have intelligence and are, in fact, prisoners within their own bodies. I believe that they did not have the opportunity for education until, perhaps, Miss Rosemary Crossley, among others, came along. She has received quite inadequate support for the things she has been trying to do.
I think that there has been a strange reluctance on the part of some of the authorities and the people working in that area to recognise the marvellous possibility that these people have intelligence. One can understand, perhaps, the reactions of some people who have been mistaken in their assessments in the past. But one would hope that what would rise above that would be the greater joy and pleasure of knowing that possibilities are being found for people like Anne MacDonald and the other children in the hospital. No doubt other people in other hospitals with sufficient attention, sufficient trained staff and sufficient money could be brought into a position where they could lead semiindependent, if not independent, lives. They would feel able, as personalities, to be treated separately and not- as they are- as babies at the age of 16, 17 or 18 years and put to bed at 4 o’clock in the afternoon. I refer also to the various other things and descriptions of life which Senator Melzer has given.
I did not know that Senator Melzer was to speak on this subject this evening. I have endeavoured successfully to discuss this matter with people in Victoria.I have been reluctant to discuss the matter in the Senate because I have known that an inquiry is presently being conducted in Victoria. People with considerable eminence have been appointed to look into the situation and into the intelligence and the future of these children. That inquiry is going rather slowly- all too slowly, for my liking- but nonetheless an inquiry is being held into this matter. I do not seek to go further and to express firm and determined attitudes when an inquiry is setting itself to the task of making some sort of informed decision. Nonetheless, I believe that the time will not be far away when the Parliament should consider what it can do. Certainly State governments will need to do more. The report of 1977 which Senator Melzer referred to appears to contain many valuable suggestions for the future independence of people who suffer from a physical or mentally retarded state. I think that the recommendations of that report need to be implemented. No doubt governments at both Federal and State levels will have to ensure that something is done. I refer now to the children such as those mentioned. I feel a necessity exists for breaking up the huge hospital complexes with large and unsatisfactory wards into small homelike facilities which have adequate staff and services, where education is possible and where the children live as a family and do not have to be just one part of a huge mass. It seems to me from whatI have read that this is something to which our program concerning the infirm ought to contribute. I hope this is something we will examine in the near future.
I compliment Senator Melzer on having raised this matter. I think that one cannot say a number of things which might run across the work of the inquiry that is proceeding at present, but I think the area mentioned in the motion is one where we need to be prepared to spend more money. It would not be economic money. It will cost a lot to keep people like this and to train them. The cost will not be j ustified on any basis of the amount of work the people will be able to do. They may not be able successfully to work in the future, but that is not the point. We have to be prepared to spend quite a bit more money to ensure that these children’s lives are real and that they are not allowed to just be vegetables all their lives. Medical science makes it possible for these children to live longer. Previously perhaps people took the view: What is the use of educating these children because they will probably die before they reach 20 years of age? It is now known that they can live longer if they have proper chairs, proper equipment, proper living conditions and, more importantly, proper and better food. I gather that a remarkable change has been seen in the case of Anne MacDonald in a matter of a few months since she has been out of hospital.
I think this illustration takes the motion which has been moved into perhaps one particular and definite area. It seems to me that there is a great deal the country has to do to concentrate more upon the needs of children. The fact is that in this year which is set aside in some special way we ought to concentrate on this aspect. I hope that this concentration does not stop at the end of the year. That is always the possibility with a year that is devoted to any particular group. I believe that this proposal is constructive and useful and one to which the Senate ought to give its support.
Question resolved in the affirmative.
This motion deals with the crippling consequences to our national life of the activities of tax avoiders, people whom I have described as the real subversives in our society. These tax bludgers, if I can call them such, who enjoy all the benefits of living within a democratic representative society, a wealth producing society, refuse to contribute their fair share to the nation’s revenue thereby undermining the whole fabric of our society. This is not an overstatement of the situation. If I might refer to an article by Tony Thomas in the Age of 3 August, he begins by stating:
The tax avoidance industry has taken Australia by the throat. The top stratum of income earners, with a few honourable exceptions, has virtually ceased paying tax.
The Budget statements of the Treasurer (Mr Howard) and his statement on 1 August, three weeks before the Budget, confirm this fact. In his statement on 1 August he admitted that claims for deductions from assessable income then totalling $1,41 lm had been made in respect of the 1977-78 income year under tax avoidance arrangements. I emphasise, it was $1,41 lm in that particular year. In the Budget itself, we know from page 5 of the Budget Speech that:
That would be a very conservative amount being set aside, as was pointed out in the speech by Senator Evans last night. The consequences of this disease, which has reached epidemic proportions, is to affect every aspect of Budget and fiscal policy. Much of the Government’s domestic bond raising is directed simply to filling the hole blasted in the revenue by tax avoidance schemes. Money supply balloons unexpectedly and escapes the Government’s predictions and control. In short, Budget deficit overruns, insofar as they are attributable to revenue shortfalls, are attributable almost entirely to tax avoidance.
My motion claims that the tax system has become inequitable, and it is so in several senses. Firstly, the sheer volume, complexity and obscurity of the present Tax Act, which is a direct result of the piecemeal combatting of tax avoidance schemes, means that the taxpayer is no longer certain of his real tax liability, or at least he is certain that if he is going to pay what at first glance is his tax liability he is probably something of a tax mug and that he ought to be taking advantage of this complex, obscure set of provisions which now cover so many pages of our statute book. But secondly, and perhaps more crucially, the tax system has become inequitable because the tax avoidance industry corrodes the very fabric of society. It creates inequity between taxpayers who are earning the same income, that is, it creates a horizontal inequity, and it also creates inequity between taxpayers who ought to be contributing a greater percentage of their income according to their greater capacity to pay, that is, there is a vertical inequity also. This inequity between taxpayers is, I believe, eating away that social cohesion which should obtain between citizens in a free and democratic society contributing to the programs of their government. As the Weekend Australian of 28-29 July stated:
Tax must bc cut. But while we wait, the bitter tax pill is easier to swallow if we all chew it together.
– What a dreadful mixed metaphor.
– It is this inability of some to admit their social obligation to swallow that bitter pill of taxation that I am directing my remarks to tonight. There are two arguments that one quite often hears in defence of these tax avoidance arrangements. I would like to deal with them briefly. They are offered as a justification for refusing to contribute to the nation’s coffers.
Firstly, it is simply stated, and quite openly, that present tax rates are crippling. I do not intend to argue with that point, but I would bring to the attention of the Senate, of course, Mr Howard’s contention against Mr Joh BjelkePetersen, the Premier of Queensland, that in fact, when one looks at comparative Organisation for Economic Co-operation and Development countries, Australia is by no means a really heavily taxed country. But insofar as income tax scales do place heavy burdens on Australians, is it not obvious that this situation can only be exacerbated, and can in no way be ameliorated, by tax avoidance? It seems very clear that we are here in a totally circular situation. The fact is that higher rates of taxation need to be struck by government in order to make up revenue caused by tax avoidance. It is a reasonable assumption that the rates must now be calculated by Treasury through the Taxation Office on the assumption that a growing proportion of persons who are notionally liable will avoid the payment of tax.
The only way for tax scales to be moderated is for tax avoidance to cease. If everyone contributed his fair share to the raising of necessary revenue, then clearly the proportion asked of each taxpayer would be less than at present. At the present moment, to the contrary, the burden falls heavily and more heavily on the payasyouearn middle income earner than on the selfemployed or professional class. The fact is that the tax budren in our community has been moving inexorably away from the professional classes to the PAYE taxpayer, the ordinary wage or salary earner who does not have access to advice and who does not have the opportunity to arrange his affairs in such a way as would enable him to take advantage of tax avoidance schemes. This is easily illustrated if I point out that for the period 1966-67 to 1978-79, total tax collections from PAYE increased by 20.7 per cent, while collections from non-PAYE taxpayers actually fell by 5 per cent. At the same time the number of wage and salary earners increased by 0.8 per cent, but the number of non-PAYE taxpayers increased much faster, by 2.9 per cent. Incomes of PAYE taxpayers increased by 1 7 per cent between the December quarter 1976 and the December quarter 1978, and in the same period non-wage and salary incomes increased by a massive 37 per cent. But as I have pointed out, collections from those latter non-PAYE taxpayers actually fell by 5 per cent.
It is obvious that there is a growing inequity in the way in which the tax burden falls now on those who cannot escape their PAYE obligations by use of tax avoidance schemes. This is creating such inequity that, I believe, resentment within the community is growing to quite an extent, such that there will be a tax revolt, not by those who are already pandered to in the Press, seeking to gratify their selfish greed, but by the ordinary honest PAYE taxpayer who knows that he is a mug in paying according to the scales which appear on his tax sheets. The ordinary, decent taxpayer will revolt, and in fact his organisations are beginning to make the same points. I refer to a letter in the Age of Saturday, 4 August, from Mr Bob Gradwell, Federal Secretary of the Council of Australian Government Employee Organisations, in which, amongst other things, he says: lt is manifestly unjust and socially disastrous for salary and wage earners to be slugged, as they currently are, while too many wealthy professionals and self-employed persons are paying either no income tax at all or very little.
Unless something is done we will be creating a divisive situation within the Australian community between people who earn their income by different methods, and therefore can take or are unable to take advantage of tax avoidance schemes.
The second argument that one hears is that there is some metaphysical or practical distinction between tax avoidance and tax evasion. It is supposed that tax evasion- the simplest example would be not declaring income from a second job- is illegal and ought to be punished severely, whereas tax avoidance is something which everyone ought to take advantage of, if possible, in that the transaction itself is not illegal. Parliament has never taken the view that there is such a simple distinction between tax evasion and tax avoidance. Section 260 of the Act itself embodies the view of the Parliament- the elected representatives of this country- that certain transactions entered into, whilst legal in themselves and allowed to stand in relation to every other aspect of their operation, ought not to have any effect against the Commonwealth revenue, and tax avoidance is thereby branded by this Parliament as anti-social and therefore null and void as against the Treasury.
– Would you agree it is often more effective than tax evasion?
– It is more effective and I will come to the reason. It is more effective, not because Parliament has agreed with the proposition that tax avoidance is good whilst tax evasion is evil; tax avoidance has become effective because it has been aided and abetted, I regret to say, by a non-elected and therefore, in a strict sense, politically irresponsible bench of judges. I refer to the High Court of Australia. It has to be said that there is no doubt that the High Court, by its legalistic interpretation of section 260 of the Income Tax Assessment Act, has completely vitiated the intention of the Parliament in drawing up that section. That is well known throughout the community. Obviously it is no new comment. In the Melbourne Age of Wednesday, 8 August, an article entitled ‘How the wealthy escape taxes ‘ begins:
The tax avoiders who romped off with the $400 million at the expense of wage earners in 1978-79, are filled with gratitude towards the judges of our High Court.
Espcecially remembered in their prayers is the Chief Justice, Sir Garfield Barwick.
Sir Garfield’s tax judgments are marvels of legal subtlety, but it seems they can cost ordinary Australian taxpayers about $ 100 million a pop.
Mr Deputy President, that article is couched in terms which I normally would not adopt. It is the language of a journalist, but I think it adequately conveys the understanding now within the community that the High Court has abandoned principles of interpretation used in our courts since the sixteenth century, when one looked to the mischief and to the intent in order to determine the effect of the words actually used in a statute. There is no doubt that what is needed in order to solve this impasse, this confrontation between the Parliament and the High Court- I think it is that- is for the Parliament to come up with a new taxation provision.
The piecemeal approach has proved totally inadequate, not only because there is a delay in discovery of and dealing with tax avoidance schemes as they proliferate, not only because the tax avoidance industry is, by its nature, hydraheaded no sooner is one head cut down than 10 spring up in its place- but also because the piecemeal approach to dealing with tax avoidance schemes continues the very atmosphere of a sporting contest, the very atmosphere where the fortunes of the game fluctuate. I think this creates an impression in the community that if one can get away with it well and good, one has beaten the tax man and it is up to him to come up with a remedy, if he can, in time for the next financial year. The piecemeal approach encourages that contest atmosphere.
Clearly, what is needed is that the Treasurer (Mr Howard) must, and I believe will, at the earliest opportunity- certainly before the Christmas parliamentary recess, one would hopebring forward a new section 260, a new, succinctly stated, comprehensive formula, which restates this Parliament’s contention that tax avoidance schemes should be rendered totally ineffective against the revenue. We ought to be able to say quite simply that when a transaction is entered into with the dominant intention, objectively viewed, of avoiding, evading, or defeating the provisions of taxation legislation or of altering the incidence of taxation, such a transaction should be ineffective to carry out that intent. Of course, the Commissioner of Taxation would need to have regard to ordinary family and commercial dealings when viewing transactions, but once the dominant intention of avoidance is established, all the sham should be exposed for what it is, a mere artifice of greed, and should have no effect against the revenue.
I look forward to the introduction of the provisions which the Treasurer has indicated he wishes to bring to this Parliament before the Christmas parliamentary recess. I believe that at the moment it is in the hands of private counsel. But whatever it is and however it emerges from this Parliament, I believe that it would be a very fool-hardy High Court which would then attempt to water down by legalistic interpretation that new statement of the firm view of the elected representatives of the ordinary taxpayers in this country. We are not to be frustrated in that regard by a non-elected and, as I said, therefore in the strict sense politically irresponsible, bench of judges 1 wish to say some words about retrospectivity. I believe that that matter was dealt with most comprehensively by Senator Evans in his speech last night. 1 simply say, for the purpose of the completeness of my remarks, that the Opposition believes that the Treasurer, whom I congratulate on the steps he has taken in dealing with many schemes, could be more robust in his approach, in that we see nothing inimical to our common law traditions that would prevent his backdating dealing with tax avoidance schemes which he has identified, not merely to the date on which he announces such identification but at least to the beginning of the financial year and perhaps even, in some circumstances, back to the date of their creation.
I think Senator Evans pointed out that, in the experience of the very country which gives us our abhorrence in normal circumstances of retrospective legislation having penal consequences, the judiciary in the form of Lord Green, Master of the Rolls back in 1942, and previous and current English Chancellors of the Exchequer- both the judicial and political wings of the English system- have agreed that retrospective tax legislation is a necessary part of the arsenal of society against those people who would undermine the very fabric of society by denying revenue to government and by creating unfairness between citizens who are taxpayers.
It is with that in mind that I return to my opening remarks. Tax avoiders are the real subversives in present day Australian society. They deliberately deny revenue to the elected government. They create a very widespread sense of unfairness between pay-as-you-earn taxpayers and those who can obtain their incomes in some other way. So my final suggestion is that the Treasurer should look very seriously at the penalties imposed on the major and blatant tax avoiders. I do not believe that fines, penalties, or even imprisonment, are an adequate expression of the community’s outrage at those tax bludgers. I just realised that I sounded a little like Ayatollah Tate.
– It sounded a bit journalistic, actually.
– Yes, it did.
– You are not suggesting capital punishment, are you?
– No, I am not. I noted that section 39 (4) of the Commonwealth Electoral Act states, among other things:
No person . . . attainted of treason . . . shall be entitled to have his name placed on or retained on any roll or to vote at any Senate election or House of Representatives election.
In my view- I say this seriously- those subversive characters should be placed in exactly that limbo, beyond the realm where ordinary, honest citizens participate in the democratic process. To put it in a slogan, and with due reference, deference and respect to the American Revolution: No representation without taxation. Let those people who live within the protection of our representative democracy contribute to its maintenance according to their means. If they demonstrate an unwillingness to so contribute their fair share, let them be stripped of any influence on its councils of government and let them be known as such non-citizens by the rest of the community. In other words, they ought to lose their right to vote at Federal elections. They are undermining society. They are refusing to contribute their fair share to the revenues of elected government for its programs, democratically arrived at, and they are creating gross unfairness between various sectors in the community. Therefore, I repeat, in regard to those people, those subversive elements, those tax avoiders, our attitude shoud be: No representation without taxation.
– I welcome the opportunity afforded by Senator Tate’s motion, which I fully support, to draw attention once again, as indeed I did last night in the Budget debate, to the nature and scope of the tax avoidance problem and the measures which ought to be taken to solve it. There is no getting away from the fact that in recent years tax avoidance and evasion have risen to plague proportions and that tax avoidance has become a highly visible feature of our social and economic landscape. The result of those developments has been both a growing inequity in the system, as Senator Tate graphically pointed out, with wage and salary earners bearing an intolerably increasing proportion of the overall burden, and a growing tendency for the whole tax system to be held in increasing disrepute, with more and more people asking why they should be the mugs and why they should have to pay when others so conspicuously are getting away with it. People do not mind paying their fair share of taxation, but that is so only when they know that others are too.
The scope of tax evasion and avoidance is gigantic. Let me spell out, in a little more detail than I had the opportunity to do last night, just what the scale of this phenomenon now is. How big it is rather depends on how we define avoidance and evasion. The widest definition of avoidance is one that fuzzes the already somewhat tenuous distinction, as Senator Tate pointed out, between evasion and avoidance. It includes not only the outrageous and blatant paper schemes such as Curran and its progeny, but also artificial income splitting arrangements of various kinds, involving family trusts, partnerships and the like, to offset losses against other derived income- an extension of the kind of Pitt Street farmer model. Going still further down the scale there are arrangements involving the bartering of goods and services with no identification of the money value of the goods and services being so exchanged. This is becoming increasingly common in our community. There are situations where there is payment of inflated transfer prices for goods and services received from overseas affiliated companies and organisations. Further down still there is the provision of employment benefits, in the form of allowances, benefits, compensations and gratuities which may be notionally taxable under the present tax legislation but which are notoriously unenforcible. Right down at the bottom of the scale there are situations of employees working for cash under assumed names and other situations of straightforward evasion through non-disclosure of income.
If one endeavoured to estimate the loss to revenue from all these various kinds of activities combined one could almost name one’s own figure because the estimates just have not been made publicly available. The best and most commonly suggested figure, which was that claimed in a newspaper report in the Sun-Herald on 13 May this year to be based on a confidential Treasury document, is of the order of $3,000m. That is over 10 per cent of the whole Commonwealth revenue for 1979-80, more than equivalent obviously to the proposed deficit of $2, 1 93m in this year’s Budget, more than the tax received from individuals paying provisional tax and roughly equivalent to the whole of the amount paid by way of company taxes. This is the order of the amount paid by way of company taxes. This is the order of magnitude one is talking about if one takes into account all the estimated avoidance and evasion activities presently taking place.
If one narrows the definition a bit and excludes from one’s vision the blatant and straightout evasion situations, with people just not disclosing sources of income or relying on cash or barter arrangements without the Taxation Office’s being told- arrangements which are manifestly in breach of the law as it presently stands- and confines one’s attention to what have been regarded traditionally as avoidance arrangements, and if one includes within that the whole range of avoidance arrangements, including not only paper schemes but also all other forms of artificial tax minimisation, particularly schemes involving income splitting arrangements of various kinds, then the best available estimates that seem to emerge in the literature as to the overall scale in dollar terms of this kind of avoidance is a figure of the order of $ 1 ,000m plus per annum. That is a hesitantly arrived at guess made very much a guess by the failure of the Treasury, regrettably, to give us such information as is undoubtedly in its possession about the estimated losses that are associated with various kinds of family trusts, partnerships, superannuation and other kinds of schemes in that general category.
The narrowest definition of avoidance is that which confines itself simply to the paper schemes which were the primary subject of my discussion last night and of Senator Tate’s motion. I think it is important to appreciate precisely what we are talking about when referring to paper schemes because these are naturally the avoidance arrangements which attract the greatest legitimate community indignation. These kinds of schemes are without any redeeming commercial utility or justification. They are schemes which are highly artificial, which are unambiguously inspired by avoidance motives and which have no possible commercial function associated with the normal business or profession being carried on by the taxpayer in question. They are the kinds of schemes which are hawked about in conspiratorial secrecy by promoters operating on a commission basis. They are schemes which are entered into by the taxpayer with his eyes absolutely wide open as to what he is about and why he is doing it. They are schemes which are entered into on the assumption that even if the legislature catches up with the scheme and legislates to close it off, the legislation will be unlikely to come down- indeed the scheme is unlikely to be discovered- until well into its second year of operation when the returns from its first year of operation finally get to the Taxation Office. Accordingly, they are schemes which, given the way they are legislated against at the moment, guarantee a very significant return to their promoters and to their users, at least in their first year of operation.
These are the kinds of schemes which, as again I said last night, have been estimated by the Treasurer (Mr Howard) to have cost the revenue, more or less irrecoverably, something close to $500m over the last two years and well over $600m if one goes back beyond that. Those are figures which, for reasons I have already stated to the Senate in earlier debates this week, I regard as generally very substantially understated. I believe that the current figure at which the paper schemes are bleeding money from the revenue is more accurately around $500m per year, an enormously large and significant figure. That is the range of things that one has to confront when one talks about the incidence of avoidance and evasion of tax in this community.
The inequity that is developing in our taxation scales has been well articulated by Senator Tate. I do not dwell on that particular point except to say that it can hardly be reiterated too often that the real slug in this area is the one that is being experienced not by the businessmen and professionals who have been able to take advantage of these schemes but by the wage and salary earners who, even if they have had the inclination to do so, manifestly cannot do so.
Let us talk about solutions to the avoidance problem. A whole range of solutions is potentially available, depending again very much each time on the kind of evasion or avoidance that is in issue. When one is talking about straight out evasion in the form of non-disclosure of income derived, it has to be acknowledged that on its face the present law is quite adequate to prohibit that kind of bald and unsophisticated approach to one’s fiscal responsibilities. The problem is simply that of enforcing that law and making it stick. A lot can be said about the inadequacies of the Taxation Office in this respect- inadequacies which have a great deal to do, as is universally the case these days, with staff ceilings and considerations of that kind. But that is perhaps more a matter for another debate. The primary focus of our attention needs to be on avoidance arrangements, properly so called, which are not, the way the Income Tax Assessment Act is drawn at the moment, effectively and absolutely circumscribed by prohibitions. 1 am talking here about avoidance arrangements generally involving income splitting of various kinds- the offsetting of losses against income derived from another source and the whole infinite variety of transactions which may or may not be capable of some redeeming commercial justification when used in a particular well-motivated context, but which are all too often used wholly for the purpose of bleeding dry the revenue.
In respect to avoidance situations generally, there is a number of different ways in which the legislature can approach the problem. Retrospective remedial, piecemeal legislation of the kind that I was discussing last night is only one of them. I take the opportunity that is presented by Senator Tate’s motion to mention some of the other legislative solutions that the Government ought to be getting into. Might 1 just say at the outset, however, how welcome it was to read today the statement by the Institute of Chartered Accountants, through its President, Mr John Bishop, announcing a direction by that Institute to its members to oppose artificial or contrived taxation schemes, and indicating that at least ethical sanctions would be imposed within that portion of the accountancy profession comprising its members in relation to such schemes. Regrettably, however, one fears that the nature and scope of the problem that we are talking about is such that it will not be solved, certainly not overnight, by relying on unenforceable ethical constraints of that kind. Nonetheless, it is very pleasing to note that at least one of our professions has made such an announcement. We now wait, presumably in vain, for the lawyers and doctors to come on board too. It is pleasing to note that at least one of the relevant professions involved in tax avoidance matters has at last acknowledged its larger social responsibilities. But we are not going to get there except by legislation- much tougher and more effective legislation than the kind that Mr Howard, despite all of the public relations puffery over the last 18 months, has yet come up with.
What is needed? In the first place, as Senator Tate has said, what is needed is certainly the rewriting of section 260 of the Income Tax Assessment Act to overcome its emasculation by the High Court- a rewriting that would give the Commissioner of Taxation what it was originally intended that he should be given, namely, a general discretion to override any arrangement of an artificial kind that is wholly inspired by avoidance motives. However, I do not take the view that section 260 is the be-all and end-all of taxation law enforcement. It is an important weapon in the armoury, but I envisage difficulties in drafting the section in such a form that it will survive the challenge to which it will undoubtedly be exposed in the High Court. It is a necessary weapon, lt is something which should have been on the statute book in a rewritten form a darn sight earlier than seems likely even now, despite Mr Howard ‘s protestations to that effect. We need it, but by itself it is not good enough.
The second type of solution to the tax avoidance problem is one that has not been canvassed widely, if at all, in the literature or in public debate, but I raise it as a matter which demands very careful consideration indeed. It is a wholly new approach to tax assessment generally, whereby income tax would be imposed separately on income derived from different sources. That is, it would no longer be possible to offset income from one source by losses derived from another. The problem with the present situation is that a taxpayer has both the ability and the incentive to offset losses incurred in, for example, a primary production or property investment against personal exertion income from, say, a medical practice. It is this ability to offset income from one source by losses from another which, more than anything else, has provided the impetus for a number of high income earners to adopt various kinds of paper schemes and also the age-old practice of Pitt Street farming.
– Would not that mean paying tax when one has no income?
– One would pay tax only on the income that one did in fact derive.
– If one has offsetting losses, one has no net income.
– One would endeavour, under this scheme, which regrettably I have not the time fully to articulate now, to divide a person ‘s income into separate blocks or categories. On the one hand there would be net income derived from personal exertion as against, on the other, net unearned income derived from property investments. One would certainly be able to offset losses against profits within each category. A third category might be income derived from primary production and, again, one could offset losses against profits in that area but would not be allowed a transfer from one category to another.
– Would you have refunds when losses were incurred.
– Refunds over successive years could perhaps be accommodated by that system, but again only within one category at a time. Another variation of that concept was floated by Senator Hamer last year. It was rather less easily enforceable. He said that for any given loss to be taken into account it should be required that it be incurred by a person who had a genuine profit motive at the time that he incurred it. It is the same concept as getting rid of artificial offset arrangements, but it would be administered in a different way.
The third particular kind of solution- one that needs to be treated more effectively than is the case with existing legislation, although there are some signposts to it in that legislation- is the taxation of capital gains in a number of areas in which capital gains arrangements have been devised as, in effect, an income substitute. Might I just say in parenthesis that this kind of thinking lies very much behind the concept of the capital gains tax to which the Australian Labor Party has been developing a policy commitment. We see an awful lot of tax avoidance occurring through the artificial creation of capital gains out of what is in reality an income deriving situation.
The last of the particular measures that I want to mention- I reiterate what I said last night in this respect- concerns the question of the passage of piecemeal remedial legislation, the closing of loopholes in relation to particular schemes as they emerge, but their closing by fully retrospective legislation. Senator Tate indicated a certain lack of enthusiasm for piecemeal legislation in this tax avoidance area, not only because it added exponentially to the statute book, but also because it encouraged a kind of sporting contest atmosphere. However, the point that I made last night, and that I reiterate now, is that if one makes piecemeal legislation retrospective it is very much a one-sided sporting contest which is likely to result in a knock out of more than just the scheme against which one is legislating. Because of the deterrent, disincentive effect of the notion that Parliament may legislate completely retrospectively in relation to any future scheme in which one might engage, it is likely to have a much wider-ranging effect than would appear to be the case on its face. It is the deterrent effect, once it has been done on one occasion, that is really significant.
I appreciate that it is necessary and desirable that this Parliament exercise caution in approaching the whole subject of retrospective legislation in any context at all. However, I make the point again in winding up that in talking about retrospective legislation in the taxation area one is taking about something that is very different from penal retrospective legislation. One is talking about something that has been acknowledged by the courts on a number of occasions to be legitimate and desirable in this area, which is an area in which individuals enter into arrangements not in a state of Garden of Eden innocence but with their eyes wide open. One is enacting the legislation in a context in which there are precedents for it in such jurisdictions as Britain. One is enacting it in a situation in which the Parliament on each occasion would have an opportunity to explore fully, discuss and analyse it, satisfying itself as to the legitimacy and justice of that solution in the particular case.
Overseas Students in Australia
– Order! In conformity with the Sessional Order relating to the adjournment of the Senate, I formally put the question.
That the Senate do now adjourn.
– I do not wish to detain the Senate too long, if I can avoid it, but on 2 1 August this year a statement was made in the Budget Speech relating to overseas students in Australia. On 29 August I asked the Minister for Education (Senator Carrick) a question about the overseas student charge which was imposed by the Budget and which, according to the Budget, will net $6m in fees from overseas students. On the occasion of asking that question, I sought from the Minister information about what the Budget Speech meant in relation to this issue, what investigations had been made about it, what would be involved in terms of hardship to students and a variety of matters of that kind.
– But you didn’t get much nourishment.
– I am not a normal source of nourishment as is Senator Carrick. I received the answer:
Honourable senators will know that Australia alone, 1 think, of all countries has not been charging fees to overseas students. Of course, there was a flow of students to Australia attracted by that fact. It is natural, therefore, that there should be some kind of charge.
It was unnatural for many years, but it is natural now, according to the Minister. He continued:
The details have not been fully or precisely defined. I will respond happily to Senator Button in terms of the three parts of the question to which he has sought an answer. I will try to do so as soon as possible.
That was on 29 August. I then asked a supplementary question whether, in view of the hardship involved for some students, the matter could be dealt with very quickly. The Minister said:
Senator Button may not have heard correctly. My final remarks were that I would do so as soon as possible.
Yesterday in the Senate I again asked the Minister a question in relation to this matter. In answering that question, which sought particular details about the type of students who would be affected and so on, the Minister said:
I hope in the early future to be able to introduce into this Parliament substantial details which will cover all the matters raised by Senator Button.
Of course, the operative word in the Minister’s statement is hope, because when the facts are clear about the mess that this Government has got itself into over this issue, it is seen that hope springs eternal in the Minister’s heart. It was only last year or early this year that he told this Senate that no fees for tertiary institutions would be imposed in the year 1 980. 1 understand that the device to get round this particular situation, which the Government is now suggesting, is the imposition of a visa fee on overseas students. Students will pay the equivalent of university or colleges of advanced education fees as suggested in the Budget and pay it as a visa fee in order to get Senator Carrick off the hook with his promise made not long ago that no fees for tertiary institutions would be imposed in the coming year.
The decision on this matter typifies the Government’s messy and wing and a prayer sort of approach to problems both in education and revenue raising. During his Budget speech, the Treasurer (Mr Howard) made the following announcement:
Overseas Student Charge
Commencing with the 1980 academic year, private overseas students who enrol at an Australian university or college of advanced education for the first time, or who change courses, will bc charged between $ 1,500 and $2,500 per year towards the cost of their tuition.
This charge is consistent with overseas practice where foreign students attending tertiary institutions are required to contribute to the cost of their education. The move will also assist in alleviating the current excess demand for places available to overseas students.
I interpolate here to point out that that is not the view of any university in Australia, but the Government did not bother to check up with the universities before that statement was made. The statement goes on:
This charge is estimated to yield about $6m in 1979-80 and will help to defray the costs- presently met in full by Australian taxpayers- of educating private overseas students in Australia.
Full details of these new arrangements will be announced after consultations have been held with major source countries.
Of course, we do not know what private overseas students are. We do not know who the students who change courses are for the purpose of this exercise and we do not know a variety of other matters which are vitally relevant and of concern not only to overseas students in Australia but also to student populations generally. Let me indicate the numbers of students who are affected. In universities in Australia some 8,500 to 9,000 students are enrolled at present. In CAEs some 1,860 students are enrolled from overseas of whom 1,454 are from Asian countries and, in particular, 769 from Malaysia. I give these figures because it might assist the Minister to make a statement on the matter in answer to the questions which he has been asked. In high schools there are 1 ,432 private students and four sponsored students. The Treasurer in his Budget Speech made two things quite clear. Firstly, he made it clear that the Government is committed to raising $6m from this source during the year 1980. Secondly, he made it quite clear in his Budget Speech that no consultations have taken place with overseas countries from where these students come. The unilateral decision was made and it was then intended to have consultations with the expectation of raising $6m in fees from this source. This is ludicrous. This reminds me of the Budgets of Mr Lynch, which he himself described as somewhat rubbery in the figures which they included.
In the three weeks since the Budget was delivered, several other facts about this decision of the Government have become quite clear. Firstly, when the Government made the decision it had no idea how it was going to define the concept of private student. Private student almost sounds like a pejorative expression. These days when all students are in a sense public students, the expression private student does not sound too good. The concept was included in the Budget Speech but was totally undefined. The Government has been unable to state whether the term includes not only students sponsored by Australian Government aid projects but also students in a number of other categories to which I wish to refer. For example, are students sponsored by community aid groups such as Rotary and the Freedom from Hunger Campaign included in the Treasurer’s statement? Are New Zealand students who are entitled to permanent residence in Australia the moment they arrive included in this Budget figure in relation to overseas students? Are they private overseas students when, once they get there, they enjoy the other conditions of citizenship which Australians enjoy? Are students whose costs are paid because they were granted university postgraduate awards or university scholarships included? Are students who are sponsored by the United Nations included? What about the children of diplomats? Are they private overseas students? What about external students, particularly students from Papua New Guinea who are enrolled in Queensland universities? Will they have to pay fees? What about students who are studying here under exchange programs with other universities? What arrangements will be made about them? Of course, the Government had no idea at the time this statement was brought down as to the answers to any of these questions. We know that it had no idea because people from the Department of Education are trotting around Australia now trying to get the answers. Nor did they have any idea what the expression ‘a change of course ‘ meant. When the Budget statement refers to a student who changes course having to pay fees henceforth, what does that expression mean? For example, does it mean that a student currently doing his Higher School Certificate with the anticipation that he will have free tertiary tuition in Australia changes his course by moving from Higher School Certificate to the university or a college of advanced education?
In the three weeks since this decision was made, the Government has refused to clarify the position for thousands of overseas students who are already studying here and who potentially will be affected by this decision. As all honourable senators know, they are very concerned about it. The Government has refused to state whether, for the purpose of levying these new fees, a change of course will include a change from a master’s degree to a Ph.D, particularly where universities require students to enrol in masters’ courses even though the students’ sole aims are to obtain a Ph.D.
Does the expression ‘a change of course’ include enrolment in degree courses that have a prerequisite of completion of subjects in other undergraduate facilities? Does it include students who set out to qualify as teachers by doing an undergraduate degree and who will on completion have to enrol for a Bachelor of Education degree? Are students included who, because of quotas, enrolled in a course which was not necessarily their first choice for the purpose of obtaining high enough marks, and transfer to the course that they are actually wanting to do; for example, people who want to do law but who do a year of arts and then transfer, or people who want to do medicine but who do a year of science and then transfer? Is there to be particular discrimination against those students in relation to these matters?
There is a chronic inability on behalf of the Government to define what these concepts mean. That is because the Government has no clear idea of how it will raise this $6m. It has not really thought about it. The attitude is taken: ‘We will cut a bit from the education budget. Who are the most voteless victims we can find in order to indulge in this book entry exercise?’ Of course, they are overseas students so there is a promise that by fixing these arbitrary fees one can raise $6m on the assumption that the same number of students will be here as there are now. That is an extraordinary assumption to make in this context.’ On those sorts of assumptions we can set out to fix up another Fraser Budget with this minuscule figure of $6m, and a rubbery Budget figure it is indeed.
– It certainly was, the way you spent money.
- Senator, you will have an opportunity to state your attitude. I wait with bated breath.
– Not a good response.
-At this time of night, you get what you deserve.
– Get on with it. We haven’t got time for the funnies.
– You can go home, Senator. You are not elevating either the debate or the scenery. Of course, the other matter which is important is that this is another example of the money grasping attitudes that motivate the highest spending, highest tax government this country has seen. There are no considerations of principle in relation to this issue and no considerations of equity or commitment to development aid. None of these things at all has motivated this policy. I wonder if it was considered by the Department of Foreign Affairs in any detail before it was embarked upon. Then one gets an extraordinary sort of statement from the Minister for Immigration and Ethnic Affairs (Mr MacKellar) who is a bit sensitive to this issue from the point of view of his Department. In a statement issued on 28 August, seven days after the Budget, he had this to say:
A key element of Australia’s new policy is the abandonment of previous numerical limits and the development of criteria to increase total numbers of overseas students within the available capacity of Australian institutions and without displacing Australian students.
I do not want to detain the Senate tonight but if any honourable senators on the Government side next week can tell me what that gobbledegook means, I will be very grateful. I will even stay for the adjournment debate to listen. Australia will provide unlimited places for wealthy overseas students at the expense of the less well-to-do. Is that what Mr MacKellar means? That is the implication of his statement. What sort of justification can there be for that? One matter which the Government clearly has not considered is the situation of overseas students studying at high schools in the expectation of getting into Australian tertiary institutions. Many honourable senators will have received letters from students concerned, as I have. I wish to quote from only one, which is a letter dated 5 September 1979. The student, Lee Mei Wah, stated:
The Australian Higher School Certificate, for which we are now preparing (in eight weeks time) is not recognised by our home governments. To return home at the end of this year, before even entering university, will mean one year completely wasted.
We realise that the Government is entitled to impose such fees; what we are seeking is that we not be asked to incur this crippling fee which would have prevented us from even considering coming here in the first place had we been forewarned of it. We have understandably not prepared ourselves for any fees, and they will constitute a burden beyond the capacity of our families.
We therefore suggest that the introduction of fees for private overseas students not come into operation before the 1981 intake. This will provide duc warning for further intending students: it will also allow for us, who came here under the same understanding as the current tertiary level students, to enjoy the same conditions.
That student makes an important point and I hope the Minister will consider it. How can a government with any concern for equity and justice implement a policy that has that son of consequence? It seems that the Government is not concerned about those sorts of matters. Another matter the Government did not consider and has no idea about is the extent to which the provision of this free education to overseas students was a form of indirect aid to developing countries. Neither the Government nor the tertiary institutions has any statistics about the socio-economic groups from which these students come in their own countries. Honourable senators will get telegrams and letters from university student representative councils and student bodies saying that the average income of these families is of the order of $9,000. 1 am not sure how these student bodies know that because none of the universities have that information. Some people say they have done private polls among students. I am not sure that in any sense that information can be relied on. It is not really readily available.
Many of these students are obviously wealthy and insofar as the Budget Speech was directed at them, it is probably a reasonable imposition. Many of them come from places where discrimination exists. Of course, it is not the job of the Australian education system to solve in Australia the racial problems of countries such as Malaysia, but as all honourable senators know, the students do come from countries like that. When the Government announced its policy, it clearly had no idea of what its implementation would really mean. Its eye was on the $6m, with no consideration for how the system would work or whether it would cause real hardship to a number of people. No meaningful discussions were held with representatives of the students or the tertiary institutions. Certainly the scheme the Government was proposing was not put before the educational authorities, otherwise the Government would not be so mute about how this system will work. As I have said, at the moment it has emissaries running around madly seeking information on how the implementation of the decision will be brought about so as to realise the $6m. By its own admission, there has been no consultation with governments of other countries.
In conclusion, I will make the position of the Opposition quite clear on this issue. Our first commitment, as a political party, is the provision of tertiary education to as many Australian students as possible who qualify academically, irrespective of socio-economic background. Of course, this commitment has to be balanced in any political party by a desire for Australia to pull its weight in the development of less developed countries, particularly the South East Asian countries and Papua New Guinea. The reality of trying to bring together these two commitments- which I would have thought would be basically bipartisan commitments- is that Australia, if it is to prosper, must increase its role and trade with Asia. The Labor Party would provide free places for overseas students in so far as this assisted the development of poorer countries and on the basis of inter-governmental negotiations. The Labor Party does not oppose the imposition of fees on overseas students well able to afford them. There is no information available to the Government on this issue and no information on which it could base this decision. We are opposed to a decision that will create hardship in its transition, does nothing to promote the interests of poor students in other countries and represents a real cut in one of the most worthwhile forms of aid that we have probably given.
– I want to speak about the same issue and to relate a personal case which shows the haste with which the Government moved or involved itself in this issue. Approximately four weeks before the Budget was introduced I had a telephone call from a local citizen who sought my advice in relation to an overseas student who was trying to gain permanent residence in Australia. I gave that lady some information and the overseas student concerned, acting on that information, wrote to the Department of Immigration and Ethnic Affairs in Melbourne seeking the required forms with which to apply for permanent residence. A number of weeks went by and no information was received from the Department. On the Monday prior to the delivery of the Budget, purely by accident, because nothing had happened- no correspondence had been received from the Department- that student drove to Melbourne, placed himself before the Department of Immigration and Ethnic Affairs, told his story and asked for the requisite forms, which were supplied. He filled them out. Immediately the announcement was made by the Government on Budget night he became concerned about his position. He came to see me in my electorate office on the Friday following the Budget. I rang the office of the Minister for Immigration and Ethnic Affairs (Mr MacKellar) and said to the Minister’s secretary: ‘What is the cut-off point? When is a private student eligible to stay in Australia? When does he become eligible for deportation or have to move off to his own country?’ The Minister’s secretary said: Can I come back to you, senator?’ He did so a couple of hours later.
It was obvious that the Government had made this decision without any forethought whatsoever. That officer had to read the Minister’s statement on the matter and to consult with the Department of Immigration and Ethnic Affairs before he knew the cut-off point. Because that private student had accidentally filled out those forms on the Monday prior to the delivery of the Budget he is eligible to stay in Australia. Goodness knows how many students there are who may have had similar wishes to stay in this country but because they did not fill out the forms on the Monday they will be denied that opportunity.
In all honesty there has got to be some sort of phase-in or phase-out period in relation to this legislation, otherwise hundreds of students in this country are going to be denied an opportunity to do all sorts of things that they desire to do with their lives. That happened with this student. I have met him and talked with him. He is a brilliant young man. He would have problems, because of his ethnic background, in obtaining employment once he returns to his own country. With this decision the Government may well have denied many Asian students an opportunity to develop and fulfil their lives. The Government cut them off by this very bland announcement without any real thought of the repercussions it obviously has.
– It is the practice of all governments to announce new policies in Budgets and to indicate that in the course of the Budget session the details of those policies will be announced. There is nothing new in this. Tonight Senator Button has sought to beat up something by rhetoric and when he concludes he finds he has defeated himself. He acknowledges that throughout the world fees are charged by other countries for overseas students. He would also acknowledge, if he has studied the fact, that the fees to be charged here are modest compared with those charged in other countries. There is no suggestion that there are grave inequities in the rest of the world about overseas students. Senator Button has informed the Senate of the Labor Party policy and that is the first time in years that the Labor Party has ever given us any clue as to its policy. Day in and day out it runs away from announcing that it is not opposed to charging fees to private overseas students who can afford it.
Let us look at this matter. The Government is doing nothing different from what Whitlam governments or other governments have done in announcing and developing Budget policies. The Government makes a statement in due course. During the Budget session it comes forward and brings down the announcements in detail. All that happened tonight was that Senator Button created his own Aunt Sally, all of his own making. He then proceeded to knock it down. This is the essence of nonsense and the essence of his empty rhetoric. The Government will do on this subject what it has done on every policy in the Budget: It will bring down a statement here and it will explain the policy to this Senate and to the public. Senator Button will then be entitled to get up, analyse it and, if necessary, criticise it.
I want to emphasise the essence of this situation. The taxpayers of Australia have a right to see that tax moneys are spent wisely. The taxpayers of Australia over the years, through the initiatives of successive Federal Liberal governments, through the initiative of the very imaginative Colombo Plan, which was a Liberal Government initiative, brought great aid to foreign students, particularly to Asian students. So there is no need to remind Liberal governments of those policies which are of their devising and their expansion. The number of students concerned has increased very considerably under this Government. We are fully aware of that. We are fully aware of the assistance of these things to other countries. We are aware that other countries have policies relating to fees. Those policies are equitable and they have not caused hardship. We will bring down the details and, indeed, we will invite a debate then. Until then I do suggest that honourable senators contain themselves in patience.
Question resolved in the affirmative.
The following answer to a question was circulated:
However, a man who is required to give constant care and attention to his sick wife may be granted special benefit at a rate not exceeding the rate of unemployment benefit that could be paid if he were qualified for that benefit.
Senate adjourned at 10.59 p.m.
Cite as: Australia, Senate, Debates, 13 September 1979, viewed 22 October 2017, <http://historichansard.net/senate/1979/19790913_senate_31_s82/>.