Pursuant to standing order 13, I advise the Senate that the President is temporarily absent today and the Deputy President will take the chair.
The DEPUTY PRESIDENT (Senator Hogg) thereupon took the chair and read prayers.
Debate resumed from 13 June, on motion by Senator Kemp:
That this bill be now read a second time.
I am continuing my speech on the Tax Laws Amendment (Personal Tax Reduction and Improved Depreciation Arrangements) Bill 2006, and I was at the question of whether effective marginal tax rates can be reduced to no more than the top income tax rate. The sustained high-powered campaign to lower the top tax rate of 47 per cent applying to our best-off Australians contrasted starkly with the lip-service given to addressing the much higher effective tax rates applying to our worst-off Australians. So I posed a challenge to the Treasurer: would he work to make sure that no Australian would suffer an effective marginal tax rate greater than the new top tax rate of 45 per cent? A challenge is easy, but what would it cost? Could it be done? These questions are very big ones that have no simple answers. They are also ones which have not received a great deal of attention.
Effective marginal tax rates of up to 70 per cent apply to low-income Australians when income tax and the removal of welfare are combined when moving from welfare to work. High effective marginal tax rates affect the willingness to work. Reducing EMTRs competes as a policy objective with other important objectives. Targeting of assistance to those most in need was the major objective of family assistance reform through the years of the last Labor government. Those reforms dramatically increased the adequacy of assistance to low-income families but also produced much of the EMTR problem facing us today.
The present government has both exacerbated and relieved the problem to some degree. Creating part B of the family tax benefit stacked another income test onto those already faced by women re-entering the workforce. Reducing taper rates reduced EMTRs for some and extended assistance further up the income range. However, it also increased EMTRs for middle-income families. Very high EMTRs have been reduced as the objective of unemployment assistance has changed. They had to come down to encourage part-time and casual work amongst recipients. At the same time, if they came down too far, unemployment assistance could become some sort of income supplement for low-income workers. That has not been the traditional role of unemployment assistance.
The problem to be addressed is how to produce lower EMTRs without compromising the other equally important objectives of family assistance and low-income support. EMTRs are produced by the overlapping of income tests on government payments, subsidies and income tax rates. The more payments, subsidies and rebates a family attracts, the higher the EMTRs. There are not only income tax rates but also a low-income rebate and a Medicare levy that both modify the tax rate and have phase-out ranges that can add to EMTRs. Family assistance is broken into two parts which overlap and inevitably produce higher EMTRs when combined with tax rates, levies and rebates. Families with youth allowance dependants face further stacking when the family income test for youth allowance is added. Other families may have further complications due to public housing subsidies.
Research on how many people are facing high EMTRs is surprisingly thin on the ground. A NATSEM report by Gillian Beer in 2002 gave an idea of the considerable scale of the problem. She found that high proportions of families with children, and especially sole parent families, faced high EMTRs. In 2000, David Ingles from the ANU mapped out three approaches to EMTR reduction: harmonisation, integration and separation. The harmonisation approach essentially tries to ameliorate the existing system by adjusting income tax and income tests to avoid the most serious conjunctions of withdrawal rates. In terms of fundamental reform, Ingles canvassed integration of tax and income tests. Separate means tests for welfare payments would be removed and replaced with special tax scales for those in receipt of payments. However, he warns that the differing definitions of income used for income tax and for welfare may be too far apart for integration to be feasible except as a very long term goal.
The opposite approach is to aim for full separation of the tax and welfare regimes. One suggested model involved adding family tax benefits, youth allowance and rent assistance to basic income support payments in a family and subjecting them to a single withdrawal rate. A tax credit would be provided to ensure that no tax was paid until all income support and additional payments were exhausted under the income test. This would ensure that the family was subject to only the taper on the income test for payments until they ceased and then taper on the tax credit plus the underlying tax rate.
All of these approaches involve quite radical restructuring of tax and welfare systems, but government action to date has just modified EMTRs to some degree through reduced tapers and tax rates. Without fairly fundamental recasting of tax and welfare interaction, any further adjustments to the existing system may tend to shift the EMTRs to another income or benefit group and, like squeezing a balloon, it will not get smaller but just bulge out in a different place.
However, having said all that, we still remain with the impossible situation where the community, media, business and many members of parliament have squealed loudly about the high top tax rate, wanting to bring it down from 47 per cent, and yet that same squealing is not going on for low- and middle-income Australians who face high effective marginal tax rates of 70 per cent or more. Therefore, you have to ask the question: why won’t the Treasurer address that issue and ensure that no Australian pays a tax rate greater than the highest top tax rate, whether it is an effective marginal tax rate or the nominal rate?
The Democrats have argued that Australia’s tax-free threshold is too low. Australia’s income tax free threshold is $6,000, and it has remained unchanged since 2000. It is not indexed and is therefore constantly losing real value. If it had been indexed since 2000, it would now be well over $7,200. Had the 1980 personal threshold of $4,041 kept pace with earnings, it would now be over $14,200.
Working Australians have a much lower tax free threshold than the three million senior Australians who enjoy a tax-free threshold well over $20,000. People cannot live on $6,000 a year. Australia’s welfare floor is around $12,500, calculated as the minimum income required for basic subsistence. There is no justification for taxing the income of someone earning that amount. However, the budget papers indicate that, once the proposed low-income rebate has been taken into account, a person whose income is below $25,000 per annum has an effective tax-free amount of $10,000 per year, excluding Medicare. I am glad that the Treasurer has recognised the long and consistent campaign by the Democrats for the effective tax-free threshold to be lifted.
The tax-free threshold is supplemented by a numerous and distorting array of tax exemptions, concessions and deductions, plus a myriad of welfare measures. Raising the tax-free threshold significantly should be accompanied by base-broadening measures. Revenue advantages would be matched by a simplification of the tax act.
Australian governments regularly benchmark themselves against the 30 countries of the OECD. Australia’s tax-free threshold compares poorly with the OECD. With the caveat that it is difficult to readily compare tax systems in the OECD, the data indicates that Australia’s current $6,000 tax-free threshold is less than half the OECD sample average of $15,400.
There is support for the Democrats’ position from many sources. However, the Minister for Finance and Administration, Senator Minchin, in answer to questions in the Senate, recently said that the government will not raise the tax-free threshold because of the cost. Apparently it would cost over $35 billion over four years if the tax-free threshold were raised to $12,500, which is roughly the poverty line.
The Democrats’ answer has been that raising the tax-free threshold significantly is a necessary equity and work-motivating reform that should be phased in over a number of years and that it can be funded from the surplus and base broadening. You either have a meaningful tax-free threshold or you do not, and $6,000 is not meaningful. Those who argue that there should be no tax-free threshold but instead tax credits and benefits to low-income Australians probably have a stronger case than those who argue that the tax-free threshold should remain at $6,000. We do not take that point of view. We think that the tax-free threshold should continue to rise, and rise not only meaningfully but consistently with the CPI.
Unlike the superannuation proposals, there is no significant public or media interest in the income tax cut bills. Indeed, the Labor opposition did not even take up its full 20 minutes in speaking to this bill in yesterday’s second reading debate. The ACTU, whilst it has been strongly critical of the gross benefits accruing to high-income earners in comparison to low- and middle-income earners, is not getting a matching kind of response from the Labor Party, which accepts that these income tax cut bills will pass and should pass without much concern. Both the media and the public regard the bills as a done deal.
The problem with the tax cuts package is the excessive generosity to better-off Australians compared with the benefits—which do exist—that are accorded to lower-income Australians. However, we Democrats do not have the time, the opportunity or the resources to develop a comprehensive alternative package. You need extensive access to modelling and research capabilities. Given the Senate numbers, it would be a futile waste of time for us to put up a complete alternative package.
Given our long and consistent support for raising the real income of low-income Australians, despite the inordinate largesse to high-income Australians, it is difficult for the Democrats to oppose a tax cuts package that delivers an effective $10,000 tax-free threshold and raises the disposable income of persons earning $10,000 by 3.8 per cent and persons earning $25,000 by 4.6 per cent. The Democrats do not consider the income tax package as a whole to be worthy of outright condemnation, because there are sufficient equity and positive policy elements within it concerning low- and middle-income Australians, and certainly if the government had left the highest tax level at $125,000 and the rate at 47 per cent then there would be very little room for criticism.
However, the Democrats will attempt to amend this package. We do criticise the policy choices and priorities made by the government. Our greatest concern is that the Treasurer, despite his obvious intellect and abilities, and the Treasury, despite their obvious intellect and abilities, have failed to come up with a meaningful, long-term tax reform plan. That is a matter that has been the subject of great commentary by the business and academic community, who are quite damning, in many respects, of the failure of the Treasurer and the Treasury to match the sort of long-term planning they did with respect to indirect tax with an equivalent long-term view for direct tax.
The Democrats suggest that, with respect to this package, there are only two possibilities for amendments that we can have a look at. The first would be a small tax-free threshold rise or the second would be a partial indexation of the tax rate. If we raised the tax-free threshold to $7,500, it is estimated that it would cost $8½ billion over four years, less the saving from keeping the top rate at $125,000 and 47 per cent. That would save $5.05 billion. So the net cost would be $3.45 billion over four years, which we think is easily affordable in the context of the forward estimates. As an alternative, partial indexation can be revenue neutral and is perhaps easier to sell. Organisations like the ACCI strongly support indexation of tax scales. Indexing the present $6,000 tax-free threshold would cost only $2.4 billion over four years, less the saving from keeping the top rate at $150,000 and 47 per cent, which would also cost $2.4 billion. So the net cost would be zero. Both propositions benefit all taxpayers, although the benefit is greater for low-income taxpayers.
I rise today to comment specifically on the government’s Tax Laws Amendment (Personal Tax Reduction and Improved Depreciation Arrangements) Bill 2006. As I indicated on the night of the budget, the Greens do not support the tax cuts. We think that the surplus would have been much better spent on addressing the significant challenges facing the Australian economy. The Treasurer did not mention these challenges in the budget and even failed to recognise them in the small print in the budget papers. These challenges are the significant impact on the Australian economy that is going to occur, and is already occurring, because of climate change and the need to address energy security issues—in particular, oil proofing the country—in an age where we are going to see not only oil depletion but also much more expensive oil supplies coming into Australia as we shift to being a net importer of oil within the next 10 to 15 years.
The Greens have also said that we believe that this squandering of the surplus—which is how we would see what the government has chosen to do with these tax cuts—is basically taking away a future income stream from government which is going to be challenged by the costs of infrastructure and service delivery to an ageing population. All around the country, people complain of the inadequacy of health services, in particular. They complain about the ongoing costs of providing accessible, high-quality health care in rural and regional Australia—and that is certainly significant in my state of Tasmania—and yet we find the government feels that the surplus is such and the infrastructure is such that it can give away personal tax cuts.
I think it is interesting that the budget has virtually died without a trace. Within weeks of the budget, the ‘Manna from Heaven’ and the ‘Rivers of Gold’ headlines have disappeared. What has replaced that in the public debate is the energy crisis, which I talked about in my budget reply speech. Since the budget, the Prime Minister has discovered climate change in an attempt to legitimise his rush to embrace nuclear power, and we now have a global discussion occurring in relation to the new nuclear club. We have discussions every day about the ongoing cost of fuel. The issue that is the focus in the business pages is the government’s so-called reforms to the fuel taxes and how fuel is delivered around the country. So the issues that the Greens identified on budget night as being the main threats to the budget and as being the areas in which there needed to be forward planning are precisely the issues that are rushing onto the agenda. Meanwhile, the government’s tax cuts have been lost out there in the ether.
Whilst the government might consider that it will get some benefit from votes in next year’s election because of the tax cuts, I doubt that that will be the case—because, for all that it was dressed up to be about middle Australia, these tax cuts were for the rich. This has been a budget for rich Australians, and it has exacerbated the gap between the rich and the poor. Any improvement in the lower- to middle-income bracket is completely absorbed by the increased costs of trying to access services, whether they be health services, education services, public transport services or child care. You name it, everything has become increasingly more expensive, and the tax cuts will not offset the increased costs of trying to access those services.
I think the issue of the government’s loss of a revenue stream into the future is incredibly serious. The entire budget is predicated on the assumption that corporate profits will continue into the future without any kind of interruption. Those corporate profits rely particularly on the mineral boom continuing—not being cyclic, as has always been the case in the past—because of the insatiable demand for minerals from India and China. That assumes that those economies have the capacity to grow indefinitely. It is again a failure to recognise the ecological limits. If China and India continue to grow at the rate that they are currently growing—and as is predicted—their demand for raw materials will be such that there will be huge ecological devastation around the planet in trying to fuel this particular growth. What is more, the inequities in terms of trade between the United States and China will destabilise markets into the future.
My great concern here is that the whole Australian economy has been simplified under the Howard government. Rather than being strengthened, it has been weakened. We have gone back to being, as I said in my budget reply speech, and as Doug Cameron described, a quarry, a farm and a nice place to visit. The manufacturing sector has virtually been lost, and the tertiary sector is tiny and struggling as a result of having its research and development funding strangled. The opportunity was here with the surplus to invest heavily in the research and development that would build us a more sophisticated economy, particularly in the tertiary sector, but instead it is delivering tax cuts.
We have already seen some of the great technological breakthroughs in Australia going offshore to China. We have a situation where the Treasurer gave a $52 million subsidy to car manufacturers in Australia without tying it to fuel efficiency. We had a recent discussion about how well the free trade talks are going with China, and there was even some speculation in the estimates that Australia might be able to export cars to China, but there was no apparent recognition that the Chinese have set higher vehicle fuel efficiency standards than Australia. We will not be exporting cars to China, not just because they can produce theirs more cheaply but because they have set higher fuel efficiency standards than we have in our own country. We need to wake up to the fact that the Chinese are constantly building competitive advantage into the sophisticated environmental management technologies of the next century.
The same applies to renewable energy technologies. China have set a 15 per cent target for renewables. As a result, we have Dr Shi, Australia’s first solar billionaire, making his money in China, because it is in China that he can roll out the photovoltaic technology that he learned how to establish at the University of New South Wales. Meanwhile, Professor Martin Green’s program at the University of New South Wales is underfunded.
What does that say about this budget strategy, which is to rake in the dollars from digging things up and sending them offshore? Having got those dollars, instead of investing in research and development to address climate change—the big security threat of this decade—and building a more sophisticated economy through research and development, and rolling out those technologies and transferring those jobs—as the Germans have done, as the Japanese are doing and as the Chinese are doing—what do we then do? We say: ‘No, any money that we’ve got to invest in R&D we’re going to invest in more digging up. This time, we’re going to invest it more heavily in the coal industry because we hope that, by sending our research dollars to carbon capture and storage and pumping carbon dioxide back down holes in the ground, we can continue digging it up, with business as usual.’
In terms of the uranium debate, we have precisely the same thing. We have a strategy of digging it up. But this time it is even better, because not only are we digging it up but we are filling up the holes with the waste we get back. That is an incredibly sophisticated strategy: Australia becoming the nuclear waste dump of the world and generating income from the storage of high-level nuclear waste which will be sent back to us from any number of countries around the world! That includes America—and President Bush. At the moment, he cannot get domestic approval in the United States for the storage of high-level nuclear waste, so what could be better than turning to his good friend Prime Minister John Howard and asking if he can dig a hole in the ground and store the high-level nuclear waste here for a fee? Australia is continually building budgets on digging it up, sending it away and, in the case of nuclear, taking back the waste.
This budget was an opportunity to use the surplus to invest in the new economy, and it has failed to do so. There is nowhere near the investment that is needed in solar thermal technology, for example. For all the talk about nuclear being needed for energy security, nothing could be further from the truth. The CRC on coal technology in Australia released a report saying solar thermal could produce all of Australia’s base load power using 37 square kilometres of land and could be cost competitive with coal within seven years. Why aren’t we investing in that technology, which would then be taken up in a huge way by countries such as China, and in other parts of the world where they are desperate for base load energy to replace fossil fuels? It makes absolutely no sense that Australia’s greatest resources, our huge area and our sunshine, are not being recognised as being a competitive advantage.
Instead, we are predicating a budget surplus future on the basis of our ongoing capacity to dig up minerals and send them overseas on the assumption that the minerals boom will last forever. If that is not a high-risk strategy for a budget, I do not know what is. We also have the ageing population. We have to deal with the fact that fewer and fewer Australians will be paying the taxes to keep a larger number of people who are living longer and requiring not only health and transport services but all the community services that provide a reasonable quality of life for people in their old age.
From the Greens’ perspective, we are seeing a squandering of the surplus on the basis of a risk that we can continue to dig up minerals. It is a failed strategy for our future and one that does not benefit low- and middle-income earners, who overwhelmingly would rather have better access to health, education, public transport and child care today rather than a few dollars in their pockets which do not go towards meeting those needs. In the committee stages of this bill I intend to move an amendment to address the issue of building some sort of real energy security in Australia. We have had some discussion of it since the budget, but there has been no discussion of the practical measures that could be taken to reduce energy demand in Australia. That is the simplest and cheapest way of dealing with increasing energy challenges.
Earlier this year, the Minister for the Environment and Heritage moved the Energy Efficiency Opportunities Bill, which required companies using more than 0.5 petajoules of energy per annum to engage in a mandatory energy efficiency audit. I thoroughly support that. That is precisely the way we should be going in a whole range of areas. But the government has failed in that because all it requires is that those companies conduct the audit. It does not require companies to implement the findings of those audits. At the time that bill was being debated I moved an amendment saying that the companies should not only identify the energy efficiency measures but be required to implement them with a payback period of two years initially, phasing into a period of five years, so that we got an upgrade in Australia’s business community and so that we became much more energy efficient. If you are serious about energy efficiency and security, that is what you do.
When the government moved for accelerated depreciation in the budget it was a clear opportunity to tie that accelerated depreciation to energy efficiency. In the committee stage of this bill I will be moving an amendment which does what the government had an opportunity to do with the Energy Efficiency Opportunities Bill. Hopefully, they will rethink it. If we are going to give business a windfall for accelerated depreciation, why should those businesses which are the most energy thirsty, the energy guzzlers on the grid, get a windfall benefit without having to take some responsibility for upgrading plant and equipment? As a result, that is what I will be moving, to make sure that the accelerated depreciation provisions do not apply to these energy guzzlers unless they implement the findings of the mandatory audit that the government now requires them to conduct. That is a first step and a practical step. It will be a test of the government’s so-called new commitment to climate change and to reducing our energy footprint.
The whole issue of climate change is not seriously on the government’s agenda. In the estimates just recently we had a situation where I asked the Department of Foreign Affairs and Trade and Senator Coonan whether they were looking at the national security ramifications of climate change for Australia in the Asia-Pacific region, just as the Pentagon has done for the United States. Senator Coonan had difficulty understanding the question. She asked several times and she could not understand what an environmental matter might have to do with national security. Today the Lowy Institute released their report on the national security ramifications of climate change. Only a few months ago I moved a motion asking the government to recognise environmental refugees and to work to have it incorporated into the UN convention on refugees. The government once again rejected that. I am not prepared to accept that the government even have climate change on their radar, except to invoke the words when they want to use it to cover another agenda, like being part of President Bush’s nuclear club, which is the most recent invocation of the issue of climate change.
Whether the government likes it or not, climate change, energy security and oil depletion are the big challenges to Australia in this century. They are the challenges which will rock the budget and knock it right out of the water when we have major and extreme weather events occurring because of climate change. They are going to be the issues when the next generation of Australians look back and see that the government squandered a massive surplus, failed to recognise how the world had significantly changed and failed to take advantage of Australia’s competitive opportunity at this point of significant change to embrace renewable energy and solar technologies and to go out and create a sophisticated economy that helps Australia, is globally responsible and demonstrates global leadership.
That is why the Greens are opposing the tax cuts. That is why I will be moving to require companies to do what is the right and responsible thing at this time. If they want the benefits of accelerated depreciation then they can take the responsibility for implementing the energy efficiency measures that will begin the process of focusing business on what needs to happen in Australia to address climate change.
The Tax Laws Amendment (Personal Tax Reduction and Improved Depreciation Arrangements) Bill 2006 is a very important piece of legislation because it continues the government’s commitment to being the responsible manager of the Australian economy. This bill takes an excessive tax burden off people’s backs. The steady management of our economy by the government will be one of the most enduring legacies that we can leave to the Australian people, but it is important that we do not rest on our laurels and that we continue to improve and to reform aspects of legislation when appropriate. I believe that this bill does just that.
The Tax Laws Amendment (Personal Tax Reduction and Improved Depreciation Arrangements) Bill has several purposes. Obviously, the primary purpose is to reduce the personal income tax rates for 2006-07. I will note here that while Australia’s tax regime is quite competitive when compared to the OECD average, for example, our top marginal tax rates have for a long time been amongst the highest in the OECD. This bill reduces our top marginal tax rates towards the OECD average, which has to be a good thing in retaining workers here in Australia and attracting others back to our shores who have left because of excessive taxation. At the same time, the bill manages to reduce the margin and increase the thresholds of most of the other brackets, which is a good thing. I think this is a fantastic achievement and one that the Treasurer is to be commended on.
The bill also seeks to increase the low-income tax offset for 2006-07. It will decrease the amount of Medicare levy paid by low-income senior Australians in 2006-07. As more and more Australians retire, this measure will become more and more valued. It will also increase deductions of the decline in value of depreciating business assets under the diminishing value method from 10 May 2006. For me this is perhaps one of the most important measures contained in the bill, and I will deal with that later in my address. The bill amends the Income Tax Rates Act 1986, the Income Tax Assessment Act 1936, the Fringe Benefits Tax Act 1986 and the Medicare Levy Act 1986 to achieve all these grand results.
The bill is good legislation because it continues the trend of the Howard government towards the redistribution back to taxpayers of the proceeds of increased tax revenues. Taxes, I remind the Senate, have steadily come down under the Howard coalition government. Unfortunately, those on the other side of the chamber might disparage the size of the weekly reductions in tax, but I remind you that when Labor was in government taxes were rising, not falling. An extra $500 in the pocket at the end of the year might not seem much to my colleagues on the other side, but it is far better than being $500 out of pocket.
The effect of this bill will be to increase the disposable income of taxpayers. It will give taxpayers greater control over their own financial situation. I firmly believe that private citizens are far and away the best people to manage their money. We have seen that in the recent amendments to end benefits taxation on superannuation. People under a taxable superannuation arrangement will be able to walk away with their lump sums tax free, and if they invest that money in a pension that will be tax free. In other words, they will not have to have as much capital to enjoy the equivalent level of disposable income. This is another good measure introduced by this government. It will take away the increased complexity associated with calculating termination payments and the like, where you had eight different calculations because of the previous arrangements. As I said, I firmly believe that private citizens are far and away the best people to manage their money. The government has a role, and an important one, but I believe that the Australian public should be trusted with as much of their own money as the government can permit.
By reducing the marginal tax rates and increasing the thresholds, the bill will continue to make Australia’s tax regime one of the most competitive in the world. In our region, the South-East Asian region, this is important. It will help attract and retain the highly skilled workers and professionals that our economy needs. We cannot afford to have our best and brightest move overseas because of our tax laws. I have spoken in other places about some of Australia’s brightest people being leading players in the London financial markets and increasingly occupying such positions in America. We want them back here in Australia using their brains and expertise to advance Australia’s competitive position in the world global economy.
The bill contains increased incentives to undertake additional work or start new businesses, thereby increasing productivity and employment opportunities. Unemployment is already at the lowest rate it has been in 30 years, and this bill will help ensure that unemployment rates stay as low as possible for as long as possible. I worry that if the Labor Party got power at the next election there would be massive unemployment in this country as employers take fright at the consequences for their workplace relations.
The bill also slightly decreases the tax advantages from the negative gearing aspects of property, thereby putting less upward pressure on residential property prices. This is important right across Australia, including in my own state, which has seen property prices skyrocket since 2000 without a comparable increase in the average wage.
I mention again that the bill features a 200 per cent uplift factor on the prime cost basis where people use the reducing balance method of calculating their depreciation or reduction in value. To my mind this is one of the most important aspects of the bill, as it will strongly encourage business investment. It will help farmers and small business. It will help start-up businesses and it will help established industry. In fact, this bill will dramatically help anyone who uses the diminishing value accounting method. It is an option the taxpayers have. Finally, this bill reduces the reliance on personal income tax as a source of tax revenue, and this can be a good thing. I commend the bill to the Senate.
I would like to acknowledge the speeches of my colleagues on the Tax Laws Amendment (Personal Tax Reduction and Improved Depreciation Arrangements) Bill 2006. I am always particularly interested in the contributions of Senator John Watson, who has a reputation for giving very thoughtful speeches in this chamber.
As part of the budget, the government announced personal income tax cuts for all Australian taxpayers. As is well known, from 1 July 2006 the government will reduce the marginal tax rates of 47 and 42 per cent to 45 and 40 per cent respectively. This builds on reductions to lower income rates in earlier years. In addition, the bill will increase the thresholds so that the 15 per cent tax rate will apply up to $25,000, the 30 per cent rate will apply up to $75,000, the 40 per cent rate will apply up to $150,000 and the 45 per cent rate will apply to income above that. The low-income tax offset will be enhanced by increasing it from $235 to $600. It will begin to phase out at $25,000 from 1 July 2006, compared to $21,600 currently. This means that those eligible for the full low-income tax offset will not pay tax until their annual income exceeds $10,000.
Overall, in percentage terms, the greatest tax cuts have been provided to low-income earners. These tax changes will ensure that more than 80 per cent of taxpayers face a top marginal tax rate of 30 per cent or less over the forward estimates period. Let me repeat that: the tax changes will ensure that more than 80 per cent of taxpayers face a top marginal tax rate of 30 per cent or less over the forward estimates period. That is a measure of the achievement of this government and its ability to reduce taxes.
The Medicare levy low-income phase-in rate will be cut from 20 per cent to 10 per cent, ensuring more low-income taxpayers pay a reduced rate of Medicare levy. Further, the bill ensures that senior Australians who are eligible for the senior Australians tax offset will now pay no tax on their annual income of up to $24,867 for singles and up to $41,360 for couples. The fringe benefits tax rate will also be cut to 46.5 per cent by this bill, and this will ensure that the FBT rate aligns with the top marginal tax rate, including the Medicare levy. This package provides $36.7 billion of benefits to taxpayers over four years and reinforces Australia’s reputation as a low-tax country. These tax cuts significantly restructure the personal income tax system to increase disposable incomes, to enhance incentives for participation and to improve Australia’s international competitiveness.
The bill also includes measures that substantially improve Australia’s depreciation arrangements by increasing the diminishing value rate for determining depreciation deductions from 150 per cent to 200 per cent. This change aligns depreciation deductions for tax purposes more closely with the actual decline in the economic value of an asset, which is consistent with the government’s tax policy strategy of ensuring that the tax system has minimal effect on the allocation of resources within the economy. The new depreciation arrangements provide increased incentives for Australian business to invest in new plant and equipment. This will mean that businesses will be better able to keep pace with new technology and remain competitive. Taxpayers will get the benefit of the improved depreciation arrangements for assets acquired on or after 10 May 2006. For the reasons I have outlined above, I commend this bill to the Senate and hope that it can enjoy the support of all senators, because we know that taxpayers are waiting.
Question agreed to.
Bill read a second time.
Bill—by leave—taken as a whole.
by leave—I move Democrat amendments (1) and (2) on sheet 4929:
(1) Schedule 1, item 1, page 3 (table items 1 to 4), omit the table items, substitute:
1 | exceeds $7,500 but does not exceed $25,000 | 15% |
2 | exceeds $25,000 but does not exceed $75,000 | 30% |
3 | exceeds $75,000 but does not exceed $125,000 | 40% |
4 | exceeds $125,000 | 47% |
(2) Schedule 1, item 2, page 3 (table items 1 to 4), omit the table items, substitute:
1 | does not exceeds $25,000 | 29% |
2 | exceeds $25,000 but does not exceed $75,000 | 30% |
3 | exceeds $75,000 but does not exceed $125,000 | 40% |
4 | exceeds $125,000 | 47% |
We have before us sheet 4929, which is the first proposition I will be putting to the Senate. Later we may see sheet 4951, which is an alternative to sheet 4929. Obviously if the amendments on sheet 4929 pass, I will not move the amendments on sheet 4951, but I understand the numbers in the Senate, so I anticipate we will be moving onto sheet 4951 later on. I will speak to all the amendments.
I will briefly motivate these amendments. As is clear on the face of the amendments, the aim is to raise the tax-free threshold from its present $6,000 to $7,500. The reason the schedules are included is that part of the way of paying for that would be to keep the top tax rate where it is already legislated to be, which is at $125,000, and to keep the highest tax rate at 47 per cent rather than 45 per cent. The costings show that the total estimated cost of raising the tax-free threshold to $7,500 would be $8.5 billion over four years. By keeping the top rates where they are presently legislated to be we would save $5.05 billion. Therefore, the net cost would be $3.45 billion over four years, which is easily affordable in the context of the forward estimates. Those are the savings measures that are in there.
I would refer interested listeners and senators to my website where, under my tax section, there is an extensive paper comparing Australia’s tax-free threshold with OECD data, with suitable graphs and tables to excite those people who like that sort of thing. It is there in some detail. My website is www.andrewmurray.org.au
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Shameless self-promotion! But, apart from the shameless self-promotion that my colleagues are teasing me with, I make those remarks because I have long had a detailed and professional interest in this matter. It is itemised there, and I am not going to reprise all that in this discussion. But I do want to say that Australia’s income tax free threshold is $6,000 and is unchanged since 2000, and because it has not been indexed it is therefore constantly losing real value. If it had been indexed since 2000 it would be well over $7,200, and had the 1980 personal threshold of $4,041 kept pace with earnings it would now be over $14,200. So it is a threshold which is withering away.
The point I make repeatedly is that you either have a meaningful tax-free threshold below which people do not have to pay tax or you do away with the tax-free threshold altogether and move to a system of tax credits or some form of compensation. I and my party oppose that because it creates a churning mechanism and is contrary to good tax policy. We should in fact seek to get as many people we can out of the income tax regime. It has been difficult for me to find the figures which would enable me to estimate the number of persons who would fall below the figure if you did raise the tax-free threshold. In 2003-04 there were 2.1 million taxpayers who were non-taxable—that is, they had net tax payable of zero—but they still filed a tax return to establish their non-taxable status. I remind the Senate that most of those who are low-income, part-time and casual people who would be affected by a policy of moving up the tax-free threshold, and affected beneficially, are women. It is women who populate that category quite heavily.
Unfortunately, with regard to the number of taxpayers that would not have to file a tax return if the tax-free threshold were raised, it is hard to say how many might be put in that situation, and those taxpayers may still need to put in a tax return because they need to show their work related expenses or dividends to which they are entitled a tax refund, or tax losses carried forward or rental losses, or other sources than wages and salaries of income to substantiate their taxable incomes. Those remarks draw our attention to the need for a holistic reform of our tax system to take people out of the tax system where they do not need to be paying tax, to simplify the system, to broaden the base. The Democrats have spoken many times about our belief as to how such a plan should be constructed.
The other point that I want to make is that working Australians do have a much lower tax-free threshold than three million senior Australians who enjoy a tax-free threshold well over $20,000. People cannot live on $6,000 a year. Australia’s welfare floor is $12,500 a year. The government have recognised that with respect to senior Australians. They should be recognising that with respect to low-income working Australians. I must acknowledge the point made by the government that there is an effective tax-free threshold as a result of the low-income offset, which does produce an effective tax-free amount of $10,000 per year, excluding Medicare, for people whose incomes are below $25,000 per annum.
The tax-free threshold is supplemented by a numerous and distorting array of tax exemptions, concessions and deductions plus a myriad of welfare measures. Raising the tax-free threshold significantly should be accompanied by base-broadening measures, and revenue advantages would be matched by simplification of the tax act. This government reform has done nothing to simplify the tax act, in complete contrast to the government’s efforts on superannuation where they have made a virtue of their simplification measures. The government are still without a meaningful tax reform plan with respect to direct tax to make it simpler and more efficient, to reduce churning and to take people out of the system who should not be in there—and, I might say, to broaden the base.
I make a point with respect to the OECD. Australian governments regularly benchmark themselves against the 30 countries of the OECD. Australia’s tax-free threshold compares poorly with those of OECD members, with the caveat—and it is a meaningful caveat—that it is difficult to readily compare systems in other countries. But the data does indicate that Australia’s current $6,000 tax-free threshold is less than half the OECD average of $15,400. I do not think, given the fact that the government has many bright and capable people, that they would be blind to the arguments I put. What they are concerned about is the cost. If you raised the tax-free threshold to $12,500, the cost is estimated to be $35 billion over four years. The government simply says it cannot afford that. But it cannot afford that because it has not taken a holistic view as to how to broaden the base to accomplish such a measure. Our answer is that raising the tax-free threshold is a necessary equity and work motivating reform that should be phased in over a number of years and it can be funded from the surplus and from base broadening.
I made some extensive remarks in my second reading debate speech concerning the effective marginal tax rates. We are concerned that the nature of the complex and inefficient income tax system we have acts as a major barrier to Australians who are not working entering the workforce and, indeed, as a barrier to the proper participation of many people who would otherwise work. I do not think I need to put much more of a case here. I do expect these amendments to go down but I think the purpose motivating these amendments is to ask government, the Treasury and the opposition to think about these matters and to come to a view as to whether our tax-free thresholds are desirable, what level they should be and what means of reform should be adopted to deal with them.
First of all, I acknowledge the continuing contribution that Senator Murray makes to the taxation debate and, despite his blatant self-promotion, I will go to his website and download this interesting paper, which compares personal tax rates around the world!
I have to say that Labor have some problems with this proposal. We find it problematic that we are presented with a proposal like this without much consultation at all. This is the first time we have seen this. Our concern is that this kind of a process would perhaps drive up tax rates. The proposal seems to take all the money that was allocated to the restructuring of the tax scales at the top and put it into increasing the tax-free threshold, which I know is dear to Senator Murray’s heart but we are unable to support it at this stage. This is tinkering at the edges. Labor believe this should be a part of a much larger package; so, on that basis, we will not be supporting these amendments.
Let me make the point that I do listen to Senator Murray’s contributions. I am always delighted when the Democrats purport to want to cut taxes. My general experience in this chamber has been that the Democrats are a high-spending party, and from that it follows that they are generally a high-taxing party. I commend Senator Murray for talking about cutting taxes. That is the government’s agenda. We like people to talk around the government’s agenda, so we commend Senator Murray on that point.
I have not had the opportunity to visit Senator Murray’s website in recent days, so I thank Senator Murray for reminding us that he has an extensive website. Of course all of us know Senator Murray’s longstanding interest in tax. Senator Murray drew our attention to a paper on his website on benchmarking and international comparisons. They are things that the government has done in recent months. Senator Murray, like many senators, would be very much aware of the landmark benchmarking paper done by Mr Warburton and Mr Hendy, which guided the government in its budget considerations. I think people would be very pleased with the way the government looked carefully at international benchmarking to ensure, quite appropriately, that the Australian tax system is very competitive. This government likes to compete to see what it can do to reduce the burden of taxes on taxpayers. That is one of the features of our party, as distinct from other parties in this chamber.
Senator Murray, we listened carefully to you. It will not come as a shock to you that we are not persuaded. I regret to say that we are not persuaded by the arguments that you put. We think that you have devised a somewhat blunt instrument in an attempt to deliver some further tax cuts at the expense of raising the top marginal tax rate, as you concede. The government do not believe that is appropriate. The Warburton and Hendy study drew our attention to international benchmarking and the fact that the government should look at the top tax rate, which was a bit high and cut in a little bit early. The government’s thinking was formed by looking at that important benchmarking study.
I have some figures that would be of interest to Senator Murray. The government’s tax cuts, on top of those delivered through the 2003, 2004 and 2005 budgets, have more than returned bracket creep since 1995-96. On the indexation issue, Senator Murray was worried that the benefits of the tax-free threshold could be seen to be eroded. To give Senator Murray some comfort, as I have indicated, we have more than returned the bracket creep since 1995-96. The tax cuts would have lowered tax by a greater amount than would have been achieved by indexing the 1995-96 tax thresholds to the consumer price index. I think that gives a broader perspective than some of the comparisons that have been raised in this debate. It is estimated that in 2006-07 someone on average weekly earnings will be $1,209 a year better off under the new tax scales than if the personal income tax thresholds had been indexed to CPI since 1995-96, which existed at the time this government came into office.
So what is the point I am making? It is that this government believes in tax reform; this government seeks to lower the burden of tax. In terms of marginal tax rates, I think it is a good thing, if we are talking about incentives for people to get back into the workforce or about incentives to keep people employed. We have to look at those tax rates, and I think the government has done well in its restructuring of the income tax system. Senator Murray, I listened carefully to your observations and my advisers listened carefully to your observations. We carefully weighed them up and decided that we are not able to support your amendments.
Question negatived.
The question is that items 6 to 11, 15 to 21 and 24 to 30 stand as printed.
by leave—I move amendments (1), (2), (4) and (5) on sheet 4951. In view of the fact that amendments (1) and (2) on sheet 4929 have been rejected, there is no point in moving amendment (3), so I have dropped it.
(1) Schedule 1, item 1, page 3 (table items 1 to 4), omit the table items, substitute:
1 | exceeds $6,000 but does not exceed $25,000 | 15% |
2 | exceeds $25,000 but does not exceed $75,000 | 30% |
3 | exceeds $75,000 but does not exceed $150,000 | 40% |
4 | exceeds $150,000 | 47% |
(2) Schedule 1, item 2, page 3 (table items 1 to 4), omit the table items, substitute:
1 | does not exceeds $25,000 | 29% |
2 | exceeds $25,000 but does not exceed $75,000 | 30% |
3 | exceeds $75,000 but does not exceed $150,000 | 40% |
4 | exceeds $150,000 | 47% |
(4) Schedule 1, after item 1, page 3 (before line 9), insert:
1A Clause 1 of Part I of Schedule 7
Omit “clauses 2 and 3”, substitute “clauses 2, 3 and 4”.
(5) Schedule 1, after item 2, page 4 (before line 2), insert:
2A At the end of Part I of Schedule 7
Add:
Indexation of the ordinary taxable income of the taxpayer in item 1
4. The amount of the ordinary taxable income of the taxpayer in item 1 of the table in clause 1 is indexed for each year of tax after the year of tax commencing on 1 July 2006 in accordance with the CPI indexation method as follows.
The amounts specified in item 1 of the table in clause 1 are to be increased by the indexation factor worked out using the following formula:
Sum of the index numbers for the CPI quarters for the 12 months ending on 31 March of the current year |
Sum of the index numbers for the CPI quarters for the 12 months ending on 31 March of the previous year |
where:
CPI quarter means a period of 3 months ending 31 March, 30 June, 30 September or 31 December.
index number means the All Groups Consumer Price Index number (being the weighted average of the 8 capital cities) published by the Australian Statistician.
The indexation factor is to be calculated to 3 decimal places, but increased by .001 if the 4th decimal place is more than 4.
Calculations:
(a) are to be made using only the index numbers published in terms of the most recently published reference base for the Consumer Price Index; and
(b) are to disregard index numbers that are published in substitution for previously published index numbers (except where the substituted numbers are published to take account of changes in the reference base).
If an amount worked out under the formula is not a multiple of $5, the amount is to be rounded as follows:
(c) if the amount exceeds the nearest lower multiple of $5 by $2.50 or more—round the amount up to the nearest higher multiple of $5;
(d) in any other case—round the amount down to the nearest lower multiple of $5.
Indexed amounts for each year of tax must be notified in the Gazette before the commencement of that year.
I thank both the major parties for their responses. To Senator Stephens I will make the remark, through the chair, that you might not have been aware, because you were not the shadow minister at the time, that we have previously advanced that particular proposition, so it is not entirely new to the Labor Party. But I would urge the Labor Party to produce a comprehensive tax reform plan in its next election policy, because I think it is a weakness of the government’s situation at the moment that they are adjusting rates, both nominal rates and thresholds, as they go along, but they are not addressing the fundamental problems of the tax system. And they are the problems that have been clearly itemised by many academics, many professionals, many of the more serious members of the media, and many business and community people as well as, of course, professional tax observers like some in this chamber.
Moving to the government, Minister, I am going to deal with the indexation issue, but before I do I will make two remarks. Firstly, it is true that the Democrats believe that our revenue should be predicated on the needs of the nation. Once you have decided what essential needs need to be satisfied in terms of defence, security, education, health, infrastructure and so on, you then have to design a tax system which produces that revenue. As a party, we have not been as concerned with where tax rates and thresholds sit so much as with the necessity of ensuring the tax system produces sufficient revenue for Australia’s needs.
It is arguable, of course, that we are still not spending enough in areas of considerable need. One of my great concerns with the coalition is that they consistently argue that they are the best economic managers in this country, but I never hear them argue that they are the best social managers in this country. It is at the social level that we have great concerns about suicide, domestic abuse, drug abuse and alcohol abuse, the incidence of mental health problems and general disconnection in many parts of our society from the wealth or happiness that should be a person’s lot in an extremely progressive, wealthy First World country. In that respect, of course, you need money. To the government’s credit, they have produced $1½ billion to pour into the mental health problem. I suspect they need to put in a lot more. It is not as if they have not tried to address some of these areas, but it is the Democrats’ consistent criticism that insufficient expenditure is occurring in the areas where we have real social problems.
If I have any advice for the government with respect to the next election—and I not sure I am the one most qualified to give that advice—it is that the government pay a lot more attention to social management, because their entire attention to economic management has, I think, been at the expense of some areas of real social problems and concerns. In making these general remarks, I also acknowledge the commentary by Senator Milne, who, like Senator Allison, is to be regarded as a genuine person with respect to the energy issues in this country. We do need a great deal more expenditure in that area.
It is true that we are a high-revenue party, but it is also true that we have consistently supported tax reform measures, including tax cuts, where they have been to the advantage of Australia. I remind the chamber that it was the Democrats who supported the indirect tax reform and direct tax reform of 2000, which Labor at that time opposed. We also supported the business tax cuts measures. Of course, being a sneaky devil, I had done the sums and realised it would raise more money than businesses had realised. But, still, we supported that. We have supported tax consolidation measures and business tax measures in many respects.
But our greatest concern with income tax has been that low- and middle-income Australians have not had a fair enough share of the growing wealth of the country. I do not think you can contra giving back bracket creep with making people better off. Giving back bracket creep just restores them to where they were. Your tax system should essentially try to make people better off if you can afford to, and I think that the disposable incomes of middle-income and lower income Australians deserve more of a lift than they have had. We could have afforded that. I do not reject the notion that higher income Australians deserve nominal tax cuts or tax threshold movements. But I argue that they are the last priority. First you deal with the other issues. So hopefully your next budget, which you are going to design to try to win an election, will deliver much more to lower income and middle-income Australians than you have to date.
Turning to the measures before us, on sheet 4951 is a measure that attempts to index the tax-free threshold. I do have a problem with that tax-free threshold. The measure is eminently affordable. The way we have costed it, indexing the $6,000 tax-free threshold is estimated to cost $2.4 billion over four years. You could achieve the saving to make that revenue neutral by keeping the top rate at $150,000 but knocking off the 45 per cent and restoring it to 47 per cent. That also delivers, miraculously enough, $2.4 billion, so the net cost is zero. I note that indexation has been strongly supported in many quarters, including by those great supporters of government—although they are also critical of you for not going far enough—the ACCI, which is led by a former government staffer. A proposition to index the tax-free threshold does, of course, benefit all taxpayers, but the benefit is far greater for low-income taxpayers.
I asked the library research branch statistics section to give me the various costs of indexing all the thresholds, and we thought that we would not be able to afford that at that time so we have only focused on the tax-free threshold as an indexation measure. If the $6,000 tax-free threshold were indexed then all taxpayers would receive up to $24.75 per annum. That does not even amount to—what was the famous saying?—a milkshake and sandwich tax cut. It is more like a freddo frog tax cut, but it does keep pace with inflation. Although small, this tax saving would be more equitable because it is a higher proportion of lower income earners’ taxable incomes. Of course, it would still leave it open to the government to deliver other tax cuts from a growing revenue base if it so decided. But it would take the uncertainty and the tax duplicity out of the tax system to some extent.
As a parliament, we support indexation in many areas. Welfare benefits are often indexed, including pensions, and excise and customs are indexed. Indexation is a very common feature of the tax system, and it is done for a very clear reason: to ensure that the revenue base is protected against inflation. In those circumstances, why shouldn’t taxpayers’ revenue bases be protected through indexation? The higher the income threshold the indexation is applied to, the more regressive would be the tax change and the smaller the tax numbers that would be affected.
We recognise that the numbers will mean that indexation is unlikely to be accepted in this chamber. But we argue that this is a policy measure that both the opposition and the government should think seriously about. If you support the general principle of indexation in the tax system, which I understand both parties do, then you have to decide at what stage you would seriously consider the issue of indexing tax rates. If you are averse to indexing all tax rates, the one tax rate that must be indexed—or should be indexed, in our view—is the lowest tax rate. As I have outlined, it is very affordable. We have attempted to put an indexation measure before the chamber; it has been rejected. But this is a more modest proposal, and in moving amendments (1), (2), (4) and (5) on sheet 4951 I commend this as a worthwhile policy measure for both parties to consider.
I rise to make some comments about the Australian Democrats’ proposed amendments on sheet 4951. I listened very attentively to Senator Murray’s arguments. He made some important points, most particularly about the criticism of the budget and the fact that it did not contain the tax reform that industry and businesses expected, and that internationally we do not compare very favourably in terms of our personal tax regime. But Labor has some real concerns about the proposal. The idea of blocking the top tax cut and proposing new scales slightly different to the current bill are another effective measure that Senator Murray has used to argue his case for reducing the bottom tax scale, and the indexation of the bottom tax scale for inflation is a position that we acknowledge is interesting and one that we are interested in. We also acknowledge that the Australian Chamber of Commerce and Industry has been proposing that kind of an approach.
I query, though, why the Australian Democrats proposal, which maintains the top tax rate at its current level of 47 per cent rather than accepting a reduction to 45 per cent, did not include aligning the top rate with the fringe benefits tax rate. If this bill reduces the rate to 45 per cent, by having that difference it would deliver a distortion to the tax system that would not be of any benefit. Again in this instance, Labor cannot support these amendments. While appreciating the sentiment and certainly the extent of the work that Senator Murray and the Democrats have put into modelling the proposals, we will not be supporting the amendments.
I have a couple of comments to make on the substance of the issue. Of course, my remarks on the indexation matters I made previously also apply in this case. It is true that Senator Murray and his party at times play a very constructive role in tax reform. I well remember the debates on the GST, which Senator Murray and I locked horns over for a long period of time. It was not that Senator Murray agreed with everything the government did but, nonetheless, it would be churlish of me not to recognise that the Democrats did work constructively with the government on the introduction of the goods and services tax.
I remember—and Senator Murray will remember this—the amount of abuse that was directed at Senator Murray and his party by the Labor Party and the Greens in an attempt to intimidate the Democrats into changing their general in principle support for a goods and services tax. How times have changed, Senator Murray. The Labor Party, of course, now fully accept the tax changes we made in relation to the goods and services tax. This may not be the greatest backflip in Australian history, but it would be fairly close to it, I would have thought, given the amount of debate and time the Labor Party has spent on this issue. With Senator Milne in the chamber, I do not suggest to Senator Milne that she bears any responsibility for the attitude of the Greens on this issue, but my memory is that the Greens have not been particularly constructive in relation to major issues of tax reform.
The point I am making is that in areas of tax reform the Democrats are credible in the sense that they have always wanted to engage in tax reform and they have wanted to be players. The Labor Party were not players in the area of tax reform. In fact, they were dragged kicking and screaming to the area of tax reform and, of course, as history now shows, the Labor Party are now a strong supporter of the goods and services tax—
Senator O’Brien interjecting—
Senator O’Brien, with the six Labor state governments enjoying the revenues from the goods and services tax, it would be a bold Labor federal member of parliament to oppose changes in that area. History shows, Senator Murray, that you were broadly correct and that Senator O’Brien and his colleagues were dreadfully wrong. That is what history shows. I have given you a half tick there, Senator Murray. Let me now give you a half cross.
It is not true that the government has not concentrated on areas of social reform. We do hold our chest out—and you are dead right to say that—as good managers of the economy. I think statistics demonstrate that amply in terms of the growth of the Australian economy compared with other industrialised economies around the world.
Senator Milne interjecting—
We can hold our chest out, Senator Milne. The real increases in wages and salaries which have been achieved by workers under this government are in contrast to what was achieved under the former Labor government. This government does not support economic reform for the sake of economic reform; we support economic reform for the benefits that it delivers to the Australian people, including the social benefits. It is easy to measure one major social benefit. We have brought unemployment down from the maximum rate of around 11 per cent that occurred under the previous Labor administration to around 4.9 per cent today, the lowest in a generation. That is what I call social reform with a vengeance. If you can reduce the levels of unemployment in this country and deliver real jobs to people, that to me is major social reform. Indeed, I think the Australian public recognise that.
The other area which you would know of, Senator Murray, is that, if you have a healthy economy and manage fiscal policy in a sensible fashion, it means that you are able to do far more in the social area than could have been achieved if the economy had been poorly managed. We are seeing a well-managed economy, which means revenues are rising. We have paid off debt, which means the enormous interest bill commitment has now been cut back dramatically. In fact, it is heading towards zero. The fact of the matter is that we have been able to transfer money from paying interest to paying for things like education and health.
So I do not really buy your distinction between being an economic manager and being a government of social reform. The economic achievements of this government have assisted us to deliver social reform in a wide variety of areas, which the Labor Party could not even contemplate while it was in government because the books were so grossly mismanaged. The final point is that, when you talk about the impact on families, you only have to remember the 17 per cent home mortgage rates that occurred under the Labor Party and contrast those with home mortgage rates today. Think of the benefits that that has delivered to families.
Senator Murray, we know that you thought hard on this. The government has been able to engage with you over a long period of time in areas of tax. Sometimes the engagement has been very productive and sometimes it has not succeeded. Today, I have to report to you, it has not succeeded.
Question negatived.
Mr Temporary Chairman, I withdraw amendment (3) on sheet 4951, as the substantive amendments have been rejected.
I rise to address the amendments I foreshadowed in my speech in the second reading debate, the effect of which is to restrict the application of the improved depreciation arrangements to those companies which implement the energy efficiency initiatives identified in the mandatory energy efficiency audits that went through the chamber earlier this year. I seek leave to move amendments (1) and (2) on sheet 4956 together.
Leave granted.
I move:
(1) Page 2 (after line 11), after clause 3, insert:
4 Application of improved depreciation arrangements
The improved depreciation arrangements specified in Schedule 5 of this Act apply when findings of mandatory energy efficiency opportunities assessments required by Part 6 of the Energy Efficiency Opportunities Act 2006 are implemented as specified in item 3A of Schedule 5 of this Act.
(2) Schedule 5, page 13 (after line 1), before item 3, insert:
2A After section 40-70
Insert:
40-71 No entitlement to improved depreciation unless energy audit findings implemented
(1) The provisions providing for improved depreciation arrangements in Schedule 5 of the Tax Laws Amendment (Personal Tax Reduction and Improved Depreciation Arrangements) Act 2006 do not apply to a corporation required to register in accordance with Part 3 of the Energy Efficiency Opportunities Act 2006 unless that corporation has implemented the findings of an energy efficiency opportunity assessment required by Part 6 of the Energy Efficiency Opportunities Act 2006.
In speaking to these amendments, I would first like to comment on the statement that the Howard government have been good economic managers. Senator Kemp urged us to look at the statistics. By way of interjection, I was trying to draw his attention to the current account deficit in particular. When the Howard government came to power, it was around three per cent. It has now doubled in that time. When they first came to power, Treasurer Costello could not stop talking about the current account deficit. Now it is about as unmentionable as climate change for Treasurer Costello. So the statistic that I particularly see flashing up in front of me in terms of the government’s economic management is the current account deficit.
What I am proposing here is a measure of tax reform. Much of the debate that has constituted the notion of reform is not actually tax reform; it is merely giving tax cuts and handouts from a surplus. In fact, it reduces the revenue base from which we can have the capacity to deliver improved services into the future. The point of my earlier remarks was simply that, if we have an economy which is based solely on corporate profits generated from a minerals boom, and we narrow the tax base by giving tax cuts on the back of that, when the minerals boom ends and there is a collapse in our ability to sell coal overseas in particular, where are we going to generate the revenue at that time if we have permanently reduced our revenue base? I do not think that is a particularly clever way of managing an economy into the future. The issue is the narrowing of the revenue base through these permanent tax cuts on the basis of what, in my view, is a somewhat shaky idea that we are going to be able to continue in surplus for a long time, on the back of a minerals export boom.
In terms of genuine tax reform, my view is that we should be recognising the major challenges threatening both the Australian community and the world in this century. They are, as I said, related to climate change, energy and natural resource use. We are finding that the planet is finite, in that the commodities that are traded around the world are finite. We have a population of six billion using those resources. We are getting to the point where it is completely unsustainable and we will have conflict generated as a result of that resource use. The conflict in Bougainville, the conflict in the Solomons and the conflict in West Papua—the conflicts all around us—are because of communities being brought to the brink of armed conflict as a result of excessive resource use. We have seen that with the logging companies in the Solomons. We have seen it with mining companies in Bougainville and West Papua. We are seeing it in New Caledonia with Inco’s Goro nickel mine.
What we are going to find is that all over the world, in African countries as well, when multinational corporations come in, take resources from local communities and leave them with ecological destruction without the means to provide themselves with the necessities for survival such as water and food, we will see resource conflicts. We are seeing it with water already. Genuine tax reform would recognise that scarcity of natural resources on a finite planet with an increasing population is what should generate the relationship between people, and between people and the environment.
Genuine tax reform would see us taking tax away from income altogether and shifting it to resource use. That is what some of the progressive economies in Europe are now doing. Over a period of a decade, they are shifting the taxation away from human capital and the capacity of a brains based, service based economy to generate wealth so that there is an incentive for people to use their brains and their capacity to generate wealth. They are taxed on the nature of their resource use. Whilst the tax is being taken off income, it is being put onto pollution, energy use and resource consumption use. That is driving the kinds of changes that we need in terms of people recycling, reducing pollution levels and lessening the ecological footprint of six billion people on the planet.
If you want to talk about genuine tax reform in Australia, that is what we should be looking at. We should be moving away from the taxation of incomes and towards taxing the bads—that is, the processes threatening ecological systems. You would be starting to look at the way that you deal with the threats to our economy that are coming in terms of, for example, water shortages, food capacity and energy use.
That is the sort of genuine tax reform that we are seeing in countries like Sweden. They have set themselves the task of being oil free by 2020. They have implemented a range of fiscal measures to make sure that happens. The Germans are also moving to ecological taxation and away from income taxation. So you have significant shifts. That is what I call genuine tax reform—looking at the long-term threats. If you consider what taxation is all about, it is essentially an economic tool that governs the relationship between people, and between people and their environment. I would argue that the current tools do not work because they encourage unsustainable consumption and resource use. They encourage large gaps between the rich and the poor. Both of those things destabilise communities and actually reduce the capacity of civil society to be sustainable in the longer term.
So, if you want genuine tax reform, that is where I think you should look for it, and that is the context of the amendments that I have moved. The amendments say that the idea of driving companies, businesses, to become more efficient in their use of energy, which is a scarce resource that has a substantial ecological imprint, is a good thing to do, and we should use tax measures to do that. To give business accelerated depreciation, with no responsibility on their behalf to do anything about what they do, just to get a windfall gain, to me is irresponsible.
In the debate on the Energy Efficiency Opportunities Bill 2006, Senator Ian Campbell argued that a mandatory audit of a company’s energy efficiency opportunities is all that is required because, by osmosis, the company will see the light and want to implement those changes. My argument was that, if there is a payback period of one or two years, that is a very short payback period. It is not onerous to ask those companies to implement the initiatives that have been identified in the mandatory audit. We should take the phase-in period of one or two years out to five years over a period of time so that it becomes an increasingly higher hurdle. We should do that at least in the short term.
I know that Senator Ian Campbell took this measure to cabinet himself—not only the idea to identify the energy efficiency measures but also the idea that companies would be required to implement them. The measures were rejected, and that is why I say that the government does not have a vision about tax reform driving particular outcomes, particularly on climate change or energy. I am here providing the government with another opportunity to link accelerated depreciation in business to an energy efficiency outcome, which is basically just saying that the provisions apply to everyone except the companies that are caught under the provisions of the Energy Efficiency Opportunities Bill. Around 200 companies in Australia use in excess of 0.5 petajoules of energy, and we should say to those companies: ‘You are already required to do your mandatory energy efficiency audit. Now let us see you implement those changes in order to qualify for accelerated depreciation.’ That would give them an opportunity to achieve both outcomes, and I have moved the amendments accordingly.
I thank Senator Milne for that contribution. She articulated, as did Senator Murray from the Democrats, that the Tax Laws Amendment (Personal Tax Reduction and Improved Depreciation Arrangements) Bill 2006 falls very short in terms of tax reform. The issue raised by Senator Milne about our current account deficit—and it was raised in some of the interjections by Senator O’Brien—was really highlighted in the Senate Economic References Committee’s investigation into the relationship between the current account deficit and the growing levels of household debt in Australia.
Labor agree that there is certainly no vision in the budget for Australia’s productive future. Also, we acknowledge the challenges of climate change and energy demands in the future. Our problem is that this is a tax bill and Senator Milne’s amendments seek to amend the bill in a way that ties the energy efficiency commitments of industry to the depreciation measures in the bill. We are not convinced that that is an appropriate way in which to amend this tax bill. I am not actually sure that it can even constitutionally be done that way. We do not believe that it is good public policy to link the issue of energy audit findings to the depreciation arrangements within the bill, and therefore we will not be supporting the amendment.
I was interested in Senator Milne’s comments. Senator Milne covered a range of issues, and let me deal with those issues in roughly the sequence in which they were raised by her. Senator Milne was unpersuaded by the statistics I gave on the performance of the Australian economy. I would have to say that she would be one of the few people who hold themselves to be economic commentators that would not be impressed by the general performance of the Australian economy.
Senator Milne is one expert, but let me quote another expert: Rodrigo de Rato, who is the head of the International Monetary Fund. We will contrast Senator Milne’s comments with Mr de Rato’s comments. He said, among other things, that the Howard government’s success in paying off its own debt gave it a very big cushion in managing a world recession. Senator Milne talked about a possible downturn in mineral exports—I will return to that in a minute—but she also mentioned the current account deficit. This is what the IMF said about Australia’s current account deficit, in contrast to Senator Milne’s comments. Mr de Rato stressed that the IMF did not regard Australia’s deficit as a threat to its economic health. I will quote what Mr de Rato said:
Australia’s external deficit reflects high investment, rather than inadequate domestic saving, and investment is especially strong in the resources sector, which boosts prospects for future exports.
So one expert, Senator Milne, drew our attention to the current account deficit and another expert, who just happens to be the person who is the head of the IMF, has a completely different view to Senator Milne. This is an independent view; it is not a view that is written by the Australian government—
If you’re proud of the current account deficit, tell everyone about it. If you’re happy with a six per cent current account deficit, go for it.
Senator Milne, I was just quoting you as an expert, and now I am quoting the head of the IMF. The head of the IMF, who probably has slightly more experience in this area, does not share your view. Some listeners would say that it was a touch of irony that you were talking about a possible future collapse in mineral exports when, if the Greens had had their way, no new mines would be developed and we would not have mineral exports. So I think there could be seen to be a touch of hypocrisy there, Senator Milne—but I will not go further than that, because it would be breaching standing orders. I would have to say that, for the Greens to be weeping over what they forecast as a possible downturn in mineral exports, when Senator Milne and her colleagues devote much of their waking hours to stopping any major new developments, their tears would seem to be crocodile tears—to put it as nicely as possible.
Senator Milne has proposed some changes to this tax bill. The government will not be agreeing with them. The point I would also make, Senator Milne, is that we have vigorous debates with the Democrats on a variety of issues, but the Democrats, to their credit, engage. They engage across a wide range of issues. They talk to the government and seek to bring about change in government policy. I am happy to say that they do not often succeed but, on a number of major issues—and I mentioned tax reform—the Democrats must take some credit for bringing about very significant changes in our economy and in the way taxes are imposed. The Democrats were far more farsighted than the Labor Party—who have now hopped on the bus but were not to be seen when the hard yards were being done—and the Greens.
Senator Milne, you are still a comparatively new face in this chamber. When the history of this period is written, someone will ask: ‘What change did the Greens bring about? They held the balance of power for a number of years. What major reforms did the Greens engage the Howard government on?’ I would have to say that it would be the smallest history book in the world.
What about the Snowy Hydro? How did you go on the Snowy Hydro? It was the Greens who stopped you in your tracks.
I do not think most people would give you the credit for that, Bob Brown. Senator Brown always gets nervous when I speak like this. No person has squandered the balance of power in this chamber more than Senator Brown. Senator Brown, when the history of this period is written—
Senator Bob Brown interjecting—
It is true that you got more fourth, fifth or sixth items on the ABC news than the Democrats. That is true. You won that one hands down. But, in terms of actually bringing about any significant change in Australia, the fact of the matter is that it is very hard to think of one thing that you were able to achieve over this long period of time. But I do not want to go on about that.
This bill is another area, Senator Milne, where you will not be achieving any changes. The government will not be supporting your amendments. We do not agree with them. We believe they would add further complexities to the tax system. There would be increased compliance costs for business and there would be greater uncertainty for business in terms of their application. The point I would make, Senator Milne, is that, if new technology is more energy efficient, the government’s new measures encourage investment in this new technology. So, Senator Milne, we will not be agreeing with you.
Senator Milne, as you are a comparatively new arrival in this chamber, I say to you that I encourage the Greens to dump the Senator Brown approach of not engaging with the government. It has not achieved anything over a long period of time. I would encourage a more constructive approach from Senator Milne and her colleagues. I am seeing a hint of that occasionally. Senator Milne and Senator Siewert do turn up to Senate committees, which is a big plus and a big change. They seek to engage more than perhaps Senator Brown and Senator Nettle—and I think that is a good thing. I am glad you have not adopted that particular policy whereby you ignore Senate committees. We cannot accept these amendments, but I do encourage you to continue to seek to engage with the government more constructively. If that is your approach, I for one would strongly support it.
Firstly, I am disappointed that the government’s argument against these amendments is that they would increase compliance costs for business and make it slightly more complex in terms of accelerated depreciation. Because the measure applies to a specific 200 companies across Australia, we are not talking about mega compliance costs; we are talking in terms of those companies that are caught by this act. The Minister for the Environment and Heritage, Senator Ian Campbell, when he gave the second reading speech on the Energy Efficiency Opportunities Bill 2006, outlined that it was approximately 200 companies. So I suggest that it would not be overly onerous for the government to implement this measure that would force energy efficiency measures.
It will be very interesting at the end of the 12 months to see whether those 200 companies have actually implemented any of the things in the audits, because all this bill does is allow them to accelerate depreciation on equipment of various kinds. I hope that they do it on energy efficiency, because of the increasing costs of energy and the need to reduce the costs of operating. I hope that is the case. These amendments would send a strong signal to the business community that the government is serious about energy efficiency and reducing demand. The next time we have the Prime Minister talking about energy scarcity and energy security or, for that matter, the Minister for the Environment and Heritage talking about climate change, perhaps they can explain to the Australian people why they did not find it necessary to implement measures that would have led to more fuel efficient vehicles, a more energy efficient budget and, on this measure in particular, more energy efficiency in business.
As to Senator Kemp’s challenge on engagement, I remind Senator Kemp that it was my motion for an inquiry into Australia’s future oil supplies and alternative energy that led to the Senate opting to have the Senate inquiry that is currently under way. Through that inquiry, we have had over 150 submissions from around the country. People have overwhelmingly said that this is something that the government ought to have been considering. There is also enormous relief in the business community about the fact that Australia is at last looking into what happens in the future with oil depletion and the development of alternative supplies.
It was with some amusement that I noted in the small print only a week ago that the government has announced that it is now going to have its own inquiry into Australia’s future oil supplies and transport fuels. I was very pleased about that, because it is apparent to me that, until the Greens brought it into this chamber, put it on the agenda and set up the inquiry, the government was reluctant to recognise it as a major issue. But the community is certainly saying that it is a major issue, and increased prices at the pumps are putting increasing pressure on the government to do something about it.
As to your challenge with regard to my colleague Senator Brown, it was the legal advice that Senator Brown got in relation to the sale of the Snowy Hydro that brought the issue to the point where the federal government was forced to change its mind. That was a critical role played in the initiatives that were taken to save the Snowy Hydro. I welcome Senator Kemp’s invitation for me to explain to the Senate the critical role that the Greens played in keeping the Snowy Hydro in public hands. The community is enormously appreciative of the role we played, both here in the Senate and in the upper house in New South Wales. The Greens led the running at the state and community levels in terms of organising people and assisting them to make their views heard in that regard.
Currently, the Greens are again taking a very strong role in engaging with the government on its misguided overruling of the ACT on its current laws in relation to partnerships. It is appalling to see the Howard government move in the middle of the night to try and overrule the ACT. The Greens engage very constructively here in this chamber, and I would argue that the oil inquiry for one is one of the most strategically important initiatives that has been taken by the Senate in the 12 months I have been here.
I hope, Senator Kemp, that you take on board the spirit of these amendments and not only ask companies to engage in energy audits but make them take some responsibility for meeting Australia’s challenge in terms of energy security and future energy supplies. Demand-side management is a lot cheaper and a lot easier than providing new energy sources. If we could influence the 200 companies that use the most energy between them then we would make a significant reduction in both energy use and greenhouse gas emissions, and that could easily be tied to this budget measure. What is the point of a windfall gain to business if we are not asking for some responsibility on their side? That is why I strongly recommend these amendments. I recognise that with the government’s opposition they are not going to pass, but I hope that you take them into account and quietly—as has happened with the oil inquiry—implement them in some other form in the next 12 months.
Let me make a general point to Senator Milne. Her comments about the Greens seeking to and wishing to engage are fine. That is exactly what I have been arguing. When the Greens once held the balance of power in this chamber, their astonishing approach squandered the use of that balance of power such that it will never be given back to the Greens again. That was a disappointment to many people, including many supporters of the Greens. So my substantive point remains.
If Senator Milne wants to claim credit for a variety of things, she is entitled to do that. Others will perhaps make other judgments about the impact that the Greens have had on a variety of issues. There would be many who would have barely heard the Greens’ voice, to be quite frank. Anyway, Senator Milne is entitled to make claims, and others will judge whether those claims have any merit or not. From my own point of view, they have little merit. I am not aware of the impact that the Greens have had in relation to the Snowy Hydro sale, but that is one thing that the Greens wish to claim, and we cannot stop them doing that.
I will say, Senator Milne, that I have been encouraged by the fact that you and your colleague Senator Siewert have been far more assiduous at attending Senate committee hearings than Senator Brown and Senator Nettle have been in the past. I think that is a good thing. That shows that a new philosophy is emerging in the Greens and that they are going to seek to constructively take part in debates rather than thinking of political stunts. That is a very good thing. I encourage you to pursue that general philosophy. Hopefully, in the years to come when you look back you will be able to say that the Greens actually achieved a few things, and that would be a good thing for your supporters—but the history book is a very small one at this stage.
Question negatived.
Bill agreed to.
Bill reported without amendment; report adopted.
I move:
That this bill be now read a third time.
Question put.
Bill read a third time.
Debate resumed from 13 June, on motion by Senator Kemp:
That this bill be now read a second time.
I rise to speak on the Employment and Workplace Relations Legislation Amendment (Welfare to Work and Other Measures) (Consequential Amendments) Bill 2006, which sets out a range of measures consequent upon the so-called Welfare to Work legislation which was pushed through the Senate by the government late last year. The amendments that are today before the Senate really ought not be necessary. If last December the Howard government had finally, after 10 long years, delivered the real welfare reform that this country does need, this bill would not be before the Senate. However, as history will regretfully record, the Howard government did not deliver real welfare reform, it did not tackle the reasons why people are not working and it did not deliver practical solutions. Instead it used its complete control of the parliament and of this chamber to ram through, in a guillotined debate, extreme and incompetent changes. Some of that incompetence has already come home to roost with the need for additional amendments that the government, in its unseemly haste, failed to make in previous bills.
In the context of the new welfare changes, Labor does not oppose this bill, which largely adds some consistency to the botched changes of last year. In particular, it extends some benefits that are open to single parenting payment recipients, such as the 14-week bereavement period, to principal carers who are on the dole. Of course, it would not be necessary to do this if the government were not dumping people onto the dole in the first place. The bill also applies some more consistency across similar groups receiving different payments, such as providing for a seasonal workers preclusion period for students and new apprentices claiming youth allowance. But the bill does not amend that which needs to be amended most. It does not scrap the incompetent welfare changes imposed by this government which leave people with less incentive to work than they had before. It does not scrap the incompetent changes that make it harder for jobless Australians to prepare for work with training and study.
The government’s changes cut income support for some of our most vulnerable Australians and, perhaps even more importantly, reduce the rewards from work. What this government has consistently ignored, and continues to ignore with this bill, is the impact of putting people on lower welfare payments. It is not just the immediate loss of money but the potentially disastrous effect that this will have on people’s ability to work their way out of poverty, which is what we all want. The basic cut to the money in people’s pockets is bad enough—around $20 a week for sole parent families and about $40 a week for people with a disability. Of course, we know that of family groupings in this country the family type most overrepresented in the poverty statistics is that of sole parents.
From 1 July many people who would have received the disability support pension or the single parenting payment will instead be dumped by this government onto Newstart—what is colloquially known as the dole. By 2008-09, according to the government’s own figures, 60,000 people with a disability who would have received the DSP will instead receive the dole, as will 77,000 single parents who would have received the parenting payment. Think of not only these people but also their dependants, the children who will now have to survive on less money and fewer opportunities, making life far more difficult for them. Not only does the dole provide less money for these vulnerable Australians who have many additional expenses associated with their circumstances; Newstart also has a lower free area, higher withdrawal rates and harsher tax treatment than both the disability support pension and the single parenting payment. This will mean that when these Australians are dumped onto the dole by this government they in fact will get to keep less of every dollar earned—an extraordinary proposition if you were serious about moving people from welfare to work.
Last year the National Centre for Social and Economic Modelling undertook modelling research on the changes. According to this research, which the government has never tried to refute, if a sole parent with one child does the right thing and works 15 hours a week they will keep only $81 of their earnings while the Howard government claws back the other $114 in tax and loss of social security payments. The effect of this is that this parent will be $91 a week worse off by moving into work under these changes than if they moved into work under the previous arrangements. The government dresses up this policy as welfare to work but in fact takes more out of every dollar earned for this group of people than it would under previous arrangements. It has increased the disincentive and reduced the rewards for working. It is hardly a way to try to improve people’s passage from welfare to work.
The Howard government has effectively told sole parents to work for a return of $3.88 an hour, because for their 15 hours work a week they would only be $58 ahead of someone not working. That would be before they pay for the costs of work—things like travel, clothing and so forth. For people with a disability, the situation is even worse because the DSP is not taxable whereas the dole is. According to NATSEM—in the research I referred to earlier—if a person with a disability worked 15 hours a week at the minimum wage they would keep only 25c in every dollar earned while the Howard government would claw back 75c. Such a person would be $122 per week worse off by moving into work under these changes than if they had moved into work under the previous arrangements. Again, this reduces the reward for work and creates greater financial disincentives to move into work. That is this government’s so-called plan. According to the NATSEM research, the Howard government is effectively telling people with a disability to work for a return of $2.27 an hour. Again, that is before the costs of work were taken into account.
Last month, the Minister for Employment and Workplace Relations, Minister Kevin Andrews, announced that the government had—and can I say that this was obviously under some pressure—set a threshold for the return from work that a parent would need to gain in order to be required to accept a job. If you missed this announcement, it is not surprising. The announcement was made on the afternoon when the nation’s attention was squarely focused on the East Timor deployment. But when you see the detail of Minister Andrews’s announcement, his motivation for burying it is patent. He decreed that parents would have to accept jobs that left them just $50 a fortnight better off from work, after the costs of working, such as income tax, loss of income support, clothes, travel costs et cetera, had been taken into account. Minister Andrews can complain about Labor’s response to this all he likes, but the maths of his position are quite simple: $50 a fortnight is $25 a week. If parents are being asked to work for 15 hours for a net gain of $25, they are working for an effective return of $1.66 an hour—$1.66 an hour! That is what this government is telling parents they will have to work for under these extreme welfare changes.
It gets even worse for people with a disability, who have no such threshold. The government has not yet indicated why it is that parents are given a threshold of $25 a week—even if it is manifestly inadequate—but no such safeguard, inadequate as it might be, exists for a person with a disability. Under this government’ policy, a person with a disability will have to accept a job with an even lower return than $25 a week. In fact, a person with a disability could very easily end up paying to work under the government’s changes once you take out the costs of working. What greater symbol of incompetence could there be from this government than promising welfare reform but delivering a policy that makes work less desirable than welfare?
In the recent budget, the Treasurer announced around $37 billion worth of tax cuts and a $10 billion surplus, but he could not find a way to fix this mess. He could not find a way to reverse the damage done to incentive by the government’s welfare changes. It is fair to say that the budget did finally provide some limited financial work incentives, largely as a consequence of the government adopting tax proposals that Labor had outlined over the last year. The new effective tax-free threshold of $10,000 for low-income earners does go some way to improving incentives for those moving from welfare to work and parents returning to work. Despite these changes, however, sole parents and people with a disability will still go backwards when the welfare to work measures are implemented in a few weeks, with their effective marginal tax rates increasing by up to 20c in the dollar.
Since this legislation was rammed through in December, the government has also broken its promise to provide an extra 4,000 places in disability open employment services to help people who are already on the disability support pension to move into work. These places will instead go to people with a disability who are on the dole and are further evidence that the Howard government is not serious about helping people who are currently on the DSP move into work. It does seem extraordinary that the government, after complaining about the burgeoning numbers on the disability support pension, has removed one of the significant measures it pointed to when criticised about the lack of support for existing disability support pensioners. Let us not forget that in last year’s budget this was the group that the Treasurer identified as being problematic—the 700,000-odd people on the disability support pension. For political reasons, those people have been grandfathered. They are not subject to mutual obligations, and now the government is removing one of the aspects in last year’s budget that would have assisted some of those people move from welfare to work.
Of course, consistent with their approach to training and their failure to train Australians is the refusal of this government to encourage people who are on welfare to get training so they can get the skills employers need. Once you are on the dole, you cannot satisfy your mutual obligation requirements by studying or training and you cannot access the pensioner education supplement, which is a payment made to try and assist with some of the costs of studying and training.
This is a point that the Minister for Workforce Participation appears to be somewhat embarrassed about, and when this point is raised she protests and suggests that Labor is incorrect in its views. The fact remains that, under her policies, unless you are going to do the most basic entry-level short course via your Job Network provider, you cannot acquit your Newstart obligations by studying or training. The government response is, ‘There’s nothing stopping you from studying or training on top of working 15 hours a week.’ Perhaps this is all you can expect from an out-of-touch government—out of touch after 10 long years in office. But the reality is that if you are a single parent and you are already working 15 hours a week, that will be challenging enough. It will be very difficult for people to find the time and money to study on top of that. Never mind if you want a better job, never mind that this country has a skills crisis—you still cannot study or train. It is an extraordinarily incompetent set of policy measures.
But then the government says, ‘You can acquit your obligations by studying on Austudy.’ Apart from starting off at about $6 a fortnight worse off on Austudy, you have to study full time, meaning no time for private earnings, so in fact you will be even worse off. Under the welfare changes, you cannot substitute an equivalent amount of study for work. You either work part time or study full time. It is disingenuous in the extreme for the government to claim that you can acquit your obligations with study when you would in fact have to do almost twice as much study as work to meet the obligations imposed on you. This is simply an unrealistic choice for sole parents. It is even more dishonest to make the claim that full-time study acquits obligations when it is clear that the financial penalties are so great for somebody participating in full-time study. There is the loss of income through the slightly lower Austudy rate and, more importantly, there is the loss of capacity for additional private earnings. It is a purely theoretical choice, and it is consistent with this government’s failure to make training Australians a priority.
Finally, of course, there is the ridiculously extreme set of changes that the breaching regime imposed by this government will bring. The government’s own figures are that 18,000 Australians under this regime will go without any income support assistance for eight weeks at a time. They will have two months when they receive no income support no matter what they do during that period, even if they remedy whatever breach of obligation they have engaged in. Of the 18,000 people who will be without any income support for two months, only 4,000 to 5,000, on the government’s own figures, will be eligible for what they call ‘financial case management’, that is, emergency payments for food and shelter. The remaining 14,000-odd will have no support whatsoever and will simply have to hope that the community is more charitable than the government. Only those who are classified as ‘exceptionally vulnerable’ or who have ‘vulnerable dependants’ will be eligible for this emergency assistance through financial case management. And perhaps one of the most extraordinary examples of how extreme this government’s approach is on this front is that it does not consider people who are homeless to be vulnerable enough to qualify for this financial case management.
Of course, we do not know exactly how this breaching regime or the financial case management will be implemented because the government has not made the guidelines public. In just under 2½ weeks this regime will come into place. We still have not seen the guidelines in relation to the financial case management nor have we seen final versions of the social security guidelines. Indeed, after the questioning of the department and the minister through the budget estimates process it is hard for anybody to be confident that this policy and these guidelines are well-developed at all. The social security guidelines, as I said, have not been finalised and made public. In less than three weeks we will see the biggest welfare changes this country has seen in over a generation but we are not exactly sure how they will take place. We cannot say for sure how people will be affected or what their entitlements will be because of the government’s decision to place so many of these issues in the guidelines. It is an astonishingly rich blend of arrogance and incompetence from this government.
This bill does nothing to fix these major flaws in last year’s changes. You cannot fix faulty foundations with a thin coat of paint. I want to make it clear: Labor support real welfare reform that goes far beyond moving people from one welfare queue to the dole queue. We believe people who can work should work, and for those who cannot work we should provide care and respect. Instead, this government’s changes make it harder for people on welfare who cannot work and harder still for those who can.
I just want to remind the chamber that when the legislation that this is amending passed through the House in December Judi Moylan MP made a very worthwhile contribution in the House of Representatives. It is a pity that more of the government’s back bench did not take on board some of the changes she was outlining and some of the views she put. She made the point that Labor had been making all along: that there is nothing wrong with imposing obligations on people, obligations that are reasonable and directed to trying to move people from welfare to work. These are things that Labor can support. These are things Labor has argued for. But the core of the government’s changes was a reduction in the income support paid to vulnerable families in Australia. The core of the government’s policy is moving people from one welfare payment to the lower welfare payment. The core of the government’s policy is putting people on the dole.
As Mrs Moylan pointed out, this policy could have been implemented without the reduction in income support. The government could have put in place programs to improve people’s passage from welfare to work. Instead, they went for a cheaper solution: dumping people onto the dole. The most incompetent aspect of this is that, through the effect of tax and welfare withdrawal rates, work will become less financially rewarding under these changes. The government is telling this group of Australians: ‘We are going to pay you less. Worse, we are going to make sure that you keep less of every dollar you earn. But we are still going to call it a Welfare to Work policy.’ What an extraordinary arrogance and what extraordinary incompetence.
Like Senator Wong, the Democrats do not oppose the Employment and Workplace Relations Legislation Amendment (Welfare to Work and Other Measures) (Consequential Amendments) Bill 2006 per se. It does make some improvements here and there to the existing regime. But it must be stated once again that the Democrats strongly oppose the current new regime that goes under the Orwellianly misleading title of ‘Welfare to Work’. It is one of the worst examples in this government’s 10 years in office of the gross abuse of the English language and the deliberately misleading description of government policy and legislation. It is a simplistic slogan of just three words—welfare to work—and that is all the government has used as a fig leaf to try to deflect every single criticism and cover up every single flaw in this highly flawed package. Every single complaint, every single concern that is raised, every single flaw that is pointed out in the Welfare to Work package is simply responded to by government ministers saying, ‘You must be against people getting off welfare and into work,’ and then dismissing the substance of the complaint and the concern. Frankly, I am appalled not only that this government has done that and continues to do it but that to date it has got away with it.
I was extremely disappointed at the end of last year when this legislation was guillotined through the Senate at how little attention was paid to its extremely unjust components by the press gallery and by the wider public. I acknowledge that there were other very serious pieces of legislation also being guillotined at the same time, most notably the workplace relations changes—also going under the Orwellianly misleading title of ‘Work Choices’. And, of course, there was antiterrorism legislation, which at least some of us might suggest could potentially inadvertently increase the risk of terrorism—but I will not go to that separate debate at the moment. There was also the VSU legislation and a range of other bills being guillotined through, so there is perhaps a reason why there was not as much attention to and recognition of what was being done at that time. But as we now move to 1 July, when these changes kick in, there is more awareness of what is involved and there is a recognition that the title ‘welfare to work’ is at best an extremely inadequate description of the legislation and the government’s package or, at worst, a deliberate and flagrant lie.
Under these changes a large number of people will not be assisted from welfare into work. They will be assisted from one form of welfare to a worse form of welfare. In some cases, they will be assisted—as it is called—from welfare to no income at all. That is a negative outcome. There undoubtedly will be people assisted into work through various aspects of this government’s package, but those changes and those areas of assistance are quite able to be provided without the accompanying components that cut the income of many sole parents and many people with disabilities. There is nothing about reducing people’s income that assists them into work. It is quite clear from the overall package that, in total, this was a savings measure for the government under the guise of the feel-good Orwellian title of ‘Welfare to Work’. We actually had a savings measure for government to try to reduce the number of people on the disability pension and parenting payment single and move them onto the lower payment of Newstart.
It is particularly galling now that the federal budget has appeared because, as all senators would know, there was a significant community debate about the need to change our taxation system. We have had some debate on that with the Tax Laws Amendment (Personal Tax Reduction and Improved Depreciation Arrangements) Bill 2006. There were a lot of people across the community contributing to that debate on the need for wide-ranging structural tax reform. About the only people who did not contribute to the debate were the senior ministers of the government—even a lot of government backbenchers constructively contributed to it. The Treasurer and the Prime Minister did not contribute to the debate. The Treasurer’s response was to try to squash that debate with a farcical comparative study that was supposedly independently done but basically was written by Treasury anyway to divert attention from the real issues of the need for structural tax reform.
There were a lot of issues and a lot of views put forward across the community. That is understandable and as it should be. It was also interesting how much common ground there was across the community—across the different sections and philosophical viewpoints of the community. There were some key areas of common ground, and one very common area that was mentioned was the need to reduce the tax burden on the lowest income earners through measures such as raising the bottom tax threshold, on which we have just had a debate, so I will not repeat it. Also, almost all comments talked about the need to fix the growing and serious problem of the very high effective marginal tax rates that people pay, particularly low- to middle-income earners.
The Treasurer’s response to this was to say, ‘They call it an effective marginal tax rate but it is not really tax; it is a withholdings test.’ It is like Wayne Swan and Mark Latham’s notorious claim that the family payment was not real. The Treasurer’s income withdrawal supposedly is not real either, according to him. I can assure him that it is very real and it is effectively a tax, which is why people call it ‘an effective marginal tax rate’ when they are calculating its impact.
One aspect of this government’s changes that has not been acknowledged, that needs much greater attention and that categorically is a major disincentive for people to take up work is the fact that, under these laws, many people will have their effective marginal tax rate increased. By pushing them off the disability support pension and parenting payment single and pushing them onto Newstart, you change their income test so that, if they earn small amounts of income, the withdrawal rate is significantly higher. Therefore their effective tax rate is much higher.
These people, who are amongst the lower income earners in our community, are paying tax rates much higher than people who are earning $150,000 a year or more. That is completely unjust; it is also gross inefficiency by people who are talking about the need to make our economy as productive at possible, to get people into the workforce and to meet some of our workforce shortages. This is a massive disincentive. It is a grotesque distortion and it is clearly impacting on the ability of the employment market to fill available jobs. To do all that under the label of ‘Welfare to Work’ is a disgrace. It is appalling that this government is getting away with it. The Democrats will continue to do all we can to make sure that the government does not get away with it in the long term.
We all know that people who have been on welfare for a prolonged period—particularly people who have personal issues such as being the sole parent caring for a child or children or having disabilities, even if they are termed ‘mild’ by a bureaucratic formula—are far more likely to take up part-time work than get into full-time work. That is good. The more people who can be assisted to do that, the better. Of course, it is precisely people taking up part-time or casual work who are most hit by high effective marginal tax rates because they will have those sorts of income levels—a couple of hundred dollars a week—from paid employment and they will have very significant reductions in their overall take-home income as a result of working, particularly when you add the costs of transportation and other costs involved in getting, holding down and performing a job.
The farcical formula that the government is applying in deciding whether or not people will have to take up a job on the basis of how much better off they are each week would be a joke if how it impacts on people’s lives were not so serious. But it is a very serious matter. One of the other very disturbing aspects of this debate and the misleading language that the government has used is the way that it has completely turned the notion of welfare reform on its head. These sorts of changes that the government made have again been excused and promoted under the label of ‘welfare reform’. It is a phrase the government has been using for a while but the agenda has been very different to what the phrase implies and, indeed, what was initially proposed.
Going back quite a number of years—at least five—if you look at what is known colloquially as the McClure report into welfare reform, you see that it is a fairly simple and quite readable report, which is not necessarily the case with many of these sorts of reports. It clearly demonstrated that a major aspect of trying to assist people into work is not just looking at it as a narrow, linear line from one position to another but also recognising that there is a range of barriers to people getting into the workforce and to people basically being able to have opportunity—and that means ‘opportunity’ in the widest sense of the word. Some of those key barriers are housing costs, transportation, access to training and particularly the ability of work to meet the needs of people, whether they are family needs because of being a sole parent or personal needs because of a disability. They were all recognised as key factors.
Another key component that was highlighted is the need to reduce the gap between the pension payment and what is colloquially known as the dole—the Newstart payment. The two payments have been getting steadily further apart over time because they have different indexing measures attached to them. The other aspect, which is less recognised but equally important, as I flagged before, is that different income tests apply. There is a much more generous income test for pensions than for Newstart, a more generous assets test and other concessions such as health care cards and the like. All of those things are lost to those people that are now not eligible for those payments; they will now be put on Newstart. That will mean, undoubtedly, significantly lower incomes and levels of assistance for many Australians who are already amongst the most disadvantaged. It is a contemptible approach that the government is taking and it is disgraceful that it is still pursuing it. This is one area where there needs to be a lot more attention paid to the impacts on families—on human beings—and on individual people around Australia who are affected as a result of the legislation that was passed in this place. The legislation, I might say, is supported by the Family First senator, which I find quite extraordinary, given how negatively it is going to impact on so many families around the country. That is something that needs to be monitored and followed much more closely, and the Democrats commit to doing that, as I am sure many other senators in this place will.
Finally, I want to indicate the wider problem with the approach that has been taken in the government’s welfare legislation. Whilst the changes, as far as they go, are welcome, there are still changes being made within the broader context that are going to cause major hardship to a significant number of people. We need to remember that we are talking about people’s incomes. One area of the public debate that is very misleading—and I do not blame the government alone for this one, at least—is the common assumption amongst the community and the media about what the average income of Australians is. The assumption, which is often quoted, is that the average income is $50,000 or $55,000 per annum. People hear that and assume that most people earn that amount or over. That is completely incorrect. That figure is the mean income. The median income, which is the midpoint, is much lower down—around the $30,000 mark. If you count those people who are not in the workforce and who have no income at all then the figure moves down into the $20,000 to $30,000 range, depending on which statistics you read. And so the average Australian actually earns less than $50,000 per year—around $30,000 per year. They are the sorts of people who are impacted significantly by any sort of increase in the effective marginal tax rate. That is another reason that these sorts of measures are so negative. It is about time, when we are talking about the income of people in the community, that we recognise that the majority of Australians do not earn $50,000 or $55,000 a year; the majority of Australians earn $30,000-odd or less. That is not a lot of money; obviously, that is a key reason that many families need to have two incomes. Even the average household income median, or midpoint, is only in the $50,000 to $60,000 per year range.
We need to keep those facts in mind when we are looking at measures that can affect people’s incomes, whether they are taxation or welfare changes or some of the interconnects between them. In that respect, the government is clearly putting in place changes that will mean a significant group in the community will become less well off. There has been a lot of talk from the government in recent times suggesting that there has not been greater inequality in Australia. The government denies the common phrase ‘the rich are getting richer and the poor are getting poorer’ and says, ‘Everybody is getting richer.’ It has even suggested that the gap between the so-called rich and the so-called poor is not increasing. Inasmuch as there is truth in that, the government should acknowledge that that is in large part because of the Democrats—particularly during the period when we had the balance of power in the Senate. The Democrats prevented some of the more extremely draconian and unjust welfare and tax measures that the government was going to put in place and that would have undoubtedly increased inequality. The government once again refuses to acknowledge that, in the same way that it refuses to acknowledge the significant role the Democrats have played in producing the positive workplace environments and workplace statistics that the government continues to gloat about.
But of course the key thing now is that the government have control of the Senate. In the period of time since gaining that control, they have destroyed the workplace relations system that they themselves continually say has produced such good economic outcomes. They are introducing draconian measures—like the one before that Senate today—which never in a million years would have got through the Senate before. As the government well know, measures that were far less draconian than today’s were not passed previously, because they were unjust and increased inequality. Even inasmuch as there is some truth in saying that inequality has not increased as much as some people might think, that has not been the government’s doing. It has been the Senate and the Democrats in particular that have protected that equality. Whatever might happen to the Democrats in the future, that is certainly a legacy that I will remain proud of.
It also needs to be emphasised that, despite the best efforts of the Senate and the Democrats and others, there has clearly been a growing inequality in Australia. It is not just measured, and you cannot just measure it, on straightforward income through employment. But if you measure it on overall income, unearned as well as earned, and particularly if you measure it in terms of wealth, there has been a massive increase in the gap between the haves and the have-nots in this community. This is particularly between those who have housing assets and those who do not. Those who do not are less and less able to get into the housing market and have housing based assets. Measures such as the government’s Welfare to Work package will increase the number of people who have little prospect of getting into that area. It will therefore increase the number of have-nots, who are being left behind.
As that wealth gap grows bigger, particularly the component of it that is based around those who can purchase their own the house and housing investments, people’s ability to cross that gap will become less and less. It will become, eventually, an unbridgeable gap. Once it is an unbridgeable gap we have a permanently divided society, and that is not in the interests of those of us who are on the ‘haves’ side of that chasm—let alone those who are the have-nots. That is a path this country should not be going down, and we need to reverse it urgently. The changes in the legislation are okay, but the Welfare to Work changes need to be monitored. The disadvantages and injustices not only need to be highlighted but need to be reversed, and they need to be reversed as soon as possible.
The Greens share the concerns articulated today by Senator Wong and Senator Bartlett. But today I want to focus on one particular area of the Employment and Workplace Relations Legislation Amendment (Welfare to Work and Other Measures) (Consequential Amendments) Bill 2006. I have circulated an amendment to this legislation to deal with an issue that I have been raising repeatedly about this legislation whenever I can. That is the issue of family carers.
Before I go into some of the broader issues as they relate to family carers, I want to go through a short history of this legislation and a few of the changes that were, thankfully, made to it. When this legislation was first talked about, only biological parents of young children under the school age of six were to be exempted from it and from the requirements under Welfare to Work. When there was community outrage about the fact that this would unfairly affect carers, and in particular foster carers—and the Greens were very outspoken about this as well—the government, thankfully, saw that the changes did disadvantage foster carers and it made changes to exempt foster carers from this legislation. Unfortunately, at the time family carers were left out.
Family carers carry out the same responsibilities as foster carers, and therefore are subject to the same disadvantages or pressures that this legislation places on foster carers. In fact, many would argue that family carers face even more trauma than foster carers, because often they are caring for children who have been subjected to extremely traumatic circumstances. Not only are they looking after the children but they are dealing with family crises and with other family members. So I believe that the arguments for foster carers being exempt from this legislation apply just as much, if not more, to family carers.
Some people in this chamber may be aware that I have raised this issue here in this place and repeatedly in estimates, asking questions about how family carers are being looked after. When I raised this question during the debate in the Committee of the Whole on the legislation in the first place, I was assured that few children would be affected by this legislation—the children that are being cared for by family carers. I quote Hansard, in which the Special Minister of State, Senator Abetz, said:
Hopefully—and I think we would all be in agreement on this—the number of children involved in this situation would be small.
Unfortunately he got it wrong. In January this year the Australian Institute of Health and Welfare released its report, Child protection in Australia 2004-05. It did a survey of children placed in out-of-home care; in other words, children not living at home, whether they be in foster care, family or kinship care, or residential care. The report found that 40 per cent, or almost half, of children placed in out-of-home care—I emphasise ‘placed in out-of-home care’, and I will come back to that—are placed in family or kinship care. That is 9,435 kids. Twelve thousand, six hundred and eighty kids are placed in foster care and 939 kids are placed in residential care. Almost half of all kids who are placed in out-of-home care are placed with family carers. So much for the small number placed with family carers; it is almost as many as are placed with foster carers. So the argument that only a small number of children are placed in family care so we do not need to worry about them because the vast majority is in foster care is blown out of the water. If you are just relying on numbers, it is almost the same. On numbers alone the argument should be that the same exemption should apply to family carers as applies to foster carers.
But the report also found that the number of children being placed in out-of-home care is going up yearly. On 30 June 1996 there were 13,979 children in out-of-home care. On 30 June 2005 there were 23,695. That is an increase from three per thousand to 4.9 per thousand. Further, the figures show that this is a yearly increase. So we can expect that there will be more and more children placed in out-of-home care, whether it be foster care or family care. That is a 70 per cent increase over that nine-year period. I would argue that is a significant increase.
Unfortunately, the figures also point out that, proportionally, more Aboriginal children are going into out-of-home care. There were 5,678 Aboriginal and Torres Strait Islander kids in out-of-home care in June 2005. This is an increase of 619 since June 2004. About 26 Aboriginal and Torres Strait Islander children per 1,000 are in out-of-home care versus about four non-Aboriginal children per 1,000. Aboriginal children are six times more likely to be in out-of-home care. The point here is that Aboriginal families are much more likely to be affected by these changes than non-Aboriginal families. There are also greater impacts for large urban Aboriginal populations. Nearly nine children per 1,000 in the Northern Territory, nearly 21 children per 1,000 in Queensland and nearly 23 children per 1,000 in Western Australia are in out-of-home care, whereas in Victoria it is nearly 41 per 1,000 and in New South Wales it is nearly 40 per 1,000. In other words, it is Aboriginal urban populations that are being more strongly affected by these changes.
I would like to reiterate that we are talking about 9½ thousand children. This is a large percentage of children who are being affected. The trend is increasing. It impacts most significantly on Aboriginal families, particularly urban ones. These figures are for children who are placed in family care. It is likely to underestimate the number of kids in family care, because many children are placed in family care informally—in other words, the families step in and take care of the children before it comes to the attention of the department. They are struggling to deal with the trauma of children in family care and take it upon themselves, without intervention.
During various opportunities in estimates I asked a number of questions on this issue because I am deeply concerned about the adverse impact this is going to have on the families that provide family and kinship care and, of course, the impact that that necessarily has on the children in their care. I have been told that this is a policy decision of government. The agency, it seems, is not able to deal with it very well. In fact, I have had very unsatisfactory answers to my questions about it. I have been mainly told that this is about foster carers. It was a political decision, a policy decision, taken by government to look after foster carers. It is one I very strongly support, but it is also one I am very greatly disappointed about, in that it is not picking up a large cohort of carers and the children they care for.
I also understand that there are going to be some guidelines on this issue, but it is not regulation and it is not in the legislation. They are not being given the same protection, support and exemption that foster carers and the children in that foster care receive. I believe it is much better to acknowledge and to protect the large contribution made by family and kinship carers and their rights. It is in the best interests of the children to protect them under the law and to protect them under the same exemption that the foster carers have. I believe the place to do this is in a provision under the act.
We need to understand the situation of family carers. Often, as I said before, they take over the care of children in extremely difficult and traumatic circumstances. I suggest to you that there are no circumstances under which children move out of parental care into either foster care or family care where there are not difficult and traumatic circumstances. In many circumstances, the children who go into family care have suffered and, unfortunately, have been subject to abuse. They need extra support and extra counselling, which means, for example, taking children out of school during the day to counselling sessions, often a number of times a week. This applies not only to children under the age of six but, in many cases, to children of all school ages, and they all need support. Sometimes it is very sudden; other times it is a gradual thing where, over a period of time, as circumstances become more difficult, family and kinship carers find that they have been handed over the care of children. Often this is informal, and they do not approach agencies, so they are not registered as foster carers are registered—and I will come back to that point in a minute. Often they do not want to be washing their so-called dirty linen in public. They do not want to be telling an agency what is going on in their family. They are just doing it.
The process can be messy. Sometimes it is only temporary and sometimes it is a long time before the process is finalised. People have to go to court, and it can take up to 18 months or longer to have the formal responsibility and care of the children in your family. Sometimes there is a source of conflict within families over what is in the best interests of the child, whether the child should stay with the parents or whether aunts, uncles or grandparents should step in and provide care for children. Sometimes there is a death or disability, and this can be drawn out. So formal custody is not taken over straightaway. Sometimes they go into family care over a protracted period of time as a person, for example, gradually becomes sicker or goes in and out of hospital.
As I said, it is often under tragic circumstances, where the trauma of loss can be overwhelming. Families go into denial and they have an attitude of: ‘We can cope.’ It is not until they reach a point of financial crisis that they reach out for help. But they still need that help, whether or not they have formally registered for it and formally registered for income support for the children. They should still be supported and they should not be required to undertake all the strenuous activity that is associated with the new Welfare to Work process. The other complicating factor here is that different states and territories have different rules about the register for foster carers and whether they register family or kinship carers and what that register means. It is not standard across Australia. Some states have registers for family carers—for example, I understand the ACT does—and some do not, and it is very hard to find that information.
The other thing is that family carers are much less likely to know their rights and have access to formal channels of support than foster carers. There are foster carers’ associations and registers of foster carers. Various government agencies have foster carers registers. You have to go through a process to become a foster carer. So foster carers know their rights, but it is more than likely that very often family carers do not know theirs. They do not know where they can get information from. They do not know what support they can get from Centrelink, for example, or from other government agencies in their states. Therefore, communication and education is critical, but it is very difficult for this group. There is no obligation, as far as I am aware, for carers and family carers to be told of any support that they could receive.
Under estimates questioning, DEWR has acknowledged that the legislation is inconsistent for foster carers and family carers, that there is a significant number of family carers—and that has been pointed out in the report, so it could hardly deny it—and that the work they do is the same as that of foster carers. DEWR also acknowledged that most states and territories do not register or authorise family care in a way that fits into the act. But it states that the exemption of the family carers—I come back to it—was a government policy decision. It is a government policy decision that I believe is badly flawed. The legislation is inconsistent for these groups of children and for these carers. One set of children is advantaged because they have the exemption and their carers are covered by the exemption. Another set of children—an equal number, almost; and, in fact, if you include informal care, more children are covered—does not have the advantage of this exemption. How is that fair? How is that just?
These are our future generations. These are the children who are most disadvantaged in our society. It can be easily dealt with. Accept the amendment that the Greens will move to support family carers and give them equality with foster carers. You have done the right thing in acknowledging the hard work of foster carers. It was supported by the community. It was supported by everybody. There was acknowledgment of the work that foster carers do. Family carers do the same amount of work. Why are they not subject to and given the support of this exemption? There are problems that need to be sorted out at the state level—there is no doubt about that. There are problems about legitimisation and registration of family and kinship carers. But the Commonwealth need to provide the lead on this. They need to change the legislation to include family carers.
The other thing is that you need to make sure that it is for children over six, because children over six are traumatised by the terrible circumstances which lead to them being in care. The fundamental issue here is the welfare of children in extremely difficult circumstances. The point is to give them a chance to lead worthwhile, meaningful and productive lives in spite of the many and deep crises and extra challenges they face. This is through no fault of their own. Through no fault of their own they are starting a step back from everybody else in the first place. What matters is their welfare and that we as legislators are prepared to provide support to the people who love and care for them. We are talking about people who sacrifice a great deal to look after these children in often tragic circumstances and in circumstances where they are often dealing with their own sense of loss and grief. They are prepared to take on the extra responsibilities. We should be prepared to support and help them and not add to their burden. I will be moving the amendment to this legislation during the committee stage. I really hope the government can find it in their hearts to support this small amendment that would mean so much to so many children.
I rise to support the Employment and Workplace Relations Legislation Amendment (Welfare to Work and Other Measures) (Consequential Amendments) Bill 2006 and to indicate that there is a very important need for Australia to restructure the nature of participation in the workforce in light of the dynamics of our society today.
Members of the Senate will be aware of the previous debates on this question. They will be aware of the inquiry by the Senate Community Affairs Legislation Committee late last year. That inquiry laid out a variety of issues being addressed in the transition of the Australian social security system from one which supported, and perhaps in some senses even encouraged, a very significant proportion of Australians of working age to receive benefits and not participate in the workforce to a system where the onus is placed on people who are capable of participating in the workforce to do so. By doing so, they help to address the serious imbalance emerging in the Australian economy between the number of positions being advertised and the number of jobs being thrown up in business and the economy generally, and the number of people available to fill them.
The Senate would be aware that we have seen in only the last few days wonderful news about the unemployment rate falling below five per cent. It is extremely important that we acknowledge the evidence that this represents for the change in the nature of the Australian workforce. There is now no longer a shortage of jobs so much as a shortage of workers. We should perhaps be focusing on other indicators of the health of our economy rather than on unemployment figures. We should be looking at ways that we can address that situation as it stands today. That situation is going to worsen in light of the ageing of our population. There will be an increasing vacation of the working population by those who get older and a lack of replacement of those people by others of working age who are available to contribute to manpower shortages in our economy. The Workforce Tomorrow study by the Centre of Policy Studies at Monash University illustrated that point extremely well. It described the phenomenon of the disparity between available positions and people available to fill those positions as being in the order of 195,000 within five years.
I particularly feel an urgency to ensure that this issue is pursued, because the ACT was identified as the jurisdiction which would have, after South Australia, the worst disparity of all. Indeed, in the ACT there are already serious manpower shortages in a range of areas. It is simply going to get worse unless measures are taken to encourage as many people as possible to participate in the workforce. There cannot be any doubt that that process represents a huge cultural change in the nature of Australia’s welfare system and its policies on participation in the workforce. It is an absolutely huge change.
In today’s debate, I have heard criticism by other senators across the chamber about the changes that the federal government is engineering with these bills, but I say to them that, in addressing the so-called shortcomings in these arrangements, they need to seriously ask themselves what they would do differently if they were on the government benches. What would they do to address the looming crisis in Australia’s capacity to be a productive economy that delivers a worthwhile standard of living to all of its citizens?
We know that providing a job is the best form of welfare that we can furnish to our citizens. We know that those who have the capacity to work ought to be encouraged to work. We know that services provided to people who have an obligation to seek work should focus on getting those people into the workforce at the first available opportunity, given other constraints and their particular conditions—such as their need to care for children or the problems that some sorts of disabilities may bring to a work environment.
We acknowledge those factors. However, having done that, you cannot then avoid the question of what you actually do to effect that change. It is a significant change. With respect to supporting Australians who for a variety of reasons choose not to be in the workforce, it is a change which represents, in some senses, the repudiation of policy of many decades duration. But it would be irresponsible to fail to address those issues. I hope that this debate goes beyond simply highlighting what are, apparently, in the eyes of some people, inadequacies or shortcomings in the government’s proposal.
I move to the question of what can be done to make those changes happen and to make that outcome actually occur for the sake of the standard of living of future Australians. Currently, Australia’s participation rate of working people is 73.6 per cent—at least that was the figure available from the OECD last year. It needs to be noted that that rate is significantly behind other major OECD countries, such as Canada, Denmark, Switzerland, the United Kingdom and the United States. Comparisons are perhaps odious, but they illustrate that we are not leaping into the unknown and we are not engineering some kind of unacceptable change in the nature of the workforce by taking measures that stimulate people’s involvement in the workforce. Frankly, in order to meet the skill and labour shortages that the Australian economy will experience in the next few years, we have to ensure that we get that participation rate up as high as possible.
At present, the net growth in the Australian workforce is 170,000 people each year. Access Economics has estimated that, over the decade from 2020 to 2030, the workforce will grow by just 125,000 people—that is, a growth in the size of the workforce of about 12½ thousand people each year. The side effects of the disparity between the size of the workforce and the size of the required workforce, if you like, will lead to an ever-diminishing tax base and revenue base for governments at all levels, not simply for the federal government. It will impact seriously on the ability to provide a range of government services, including pensions, income support payments, health services and education services—all sorts of services to the Australian community. So it is obvious that we will engineer an intergenerational inequity if we cannot provide the next generation of Australian taxpayers with the opportunity to pay taxes at a reasonable level and to get reasonable access to services of the kinds that are enjoyed by the taxpayers of today.
Of course, that was the issue that the Treasurer, just a few years ago, very clearly placed on the table with his Intergenerational report, in which he warned:
Although the ageing of the Australian population is not expected to have a major impact on the Commonwealth’s budget for at least another 15 years, forward planning for these developments is important to ensure that governments will be well placed to meet emerging policy challenges in both a timely and effective manner.
Having said that we have an insufficiently high participation rate of working people in our economy, we have to acknowledge that the nature of the Australian welfare system has led to a higher degree of welfare dependency than is appropriate in order to reverse the trend towards a deficit in the number of people available to fill positions.
There are currently 2.6 million working age Australians—that is, people between the ages of 15 and 64—who are on income support. I acknowledge that the retirement age is now a moveable feast—and so it should be—but, if we take that to be the age at which people might be expected, in all circumstances, to work, there are 2.6 million Australians who are on income support, of which only 15 per cent are required to be actively searching for a job. In other words, a relatively small minority of that 2.6 million is actually required to go out into the workforce. There is a variety of issues confronting those approximately two million people who are not required to seek employment and who are on income support. Of course, there are some who will never be in a position to participate in the workforce, but it cannot be denied that we have, at the present time, a system in which far too many are capable of participating but are simply not appropriately encouraged by the nature of the system to take that decision and to seek employment.
With the present unemployment rate, there has never been a better time to seek those positions. Some people may have been discouraged by a lack of available positions on the basis of, for example, having a disability, being a mature age worker or having a low skills set, and they may have had a long history of rejection and inability to obtain employment. But what is different about the environment today, particularly with the measures that have been announced in the Welfare to Work package, is that active steps are being taken by government to engineer people through the difficulty of having a problem which perhaps makes them, in the eyes of some, less attractive employees than otherwise might be available. We acknowledge that there are many factors that can contribute to a person not obtaining employment, but we should not allow a situation to remain whereby one of those factors is their unwillingness to participate despite a capacity to do so.
In the 12 months prior to June 2004, 55 per cent of people transferred to the disability support payment from another payment in Australia. That was in reaction to changes in government policy which tightened up access to other forms of payment. In the seven years prior to June 2004, the DSP had grown to 26 per cent and the parenting payment single by 33 per cent. It needs to be recorded that there are now more working age Australians on the DSP than there are on the Newstart allowance.
There may have been factors which contributed to an increase in the number of Australians with disabilities—there may have been factors related to definitional changes which led to people having an eligibility for that payment which they did not previously have—but I think we also need to be up front and sincere enough to acknowledge that some people have taken advantage of the system to make that transition and that in some cases the disabilities complained of are not in effect a barrier to participation in the workforce, particularly given that systems are now being put in place to allow people’s particular conditions to be much more readily taken into account in their role in the workplace than has ever been the case in the past.
Money was made available, under the package announced last year, for workplaces to be modified to allow those issues to be addressed and for advice and support to be given to employers who choose to employ a worker with a disability of a level that we have not previously seen in this country. We are at last serious about getting people with disabilities a role in the workforce. Admittedly, circumstances may have forced that on us, rather than a philosophical change of viewpoint, but the fact is that those changes are taking place now. It is important that we indicate to people, particularly those with disabilities, that the system we are putting in place is now about accommodating those requirements, working through those needs and treating those with disabilities who want to participate in the workforce as citizens who have a greater capacity to do that than ever before.
I hope that, as with last year’s legislation, the changes in this legislation that are being discussed will be sympathetically considered by senators. We realise that none of these decisions is necessarily very easy. It is certainly possible for people to be miscategorised by a system which places a greater emphasis on participation. It is certainly possible for people who do not have a capacity to work to be required to work in a way which causes them some disadvantage or some loss of income support. But I am convinced that the best measure to overcome that potential is goodwill and an accepted willingness on the part of Centrelink and other agencies of the federal government that deal with people in these circumstances to address people on the basis of their individual circumstances, and to not use inflexible rules to apply to people irrespective of those individual circumstances—not, in short, to attempt to force a square peg into a round hole.
We owe it to future generations of Australians to ensure that we do this sensitively and with regard to those individual circumstances. I believe that the flexibility exists in the legislation and in the approach being taken by agencies of the federal government to engineer that outcome. I do not, of course, preclude the possibility of stories of people being mistreated by the system—and I have no doubt at all that, when those cases occur, the media will hungrily lap them up and there will be headlines. However, at the end of the day, as long as we are fair minded, we are prepared to approach this on the basis of providing for an acceptable and appropriate transition to a different kind of welfare operation in Australia, and we accept that a measure of flexibility can be applied and should be applied, I think we will be on the right track. I hope that that is the outcome of the exercise.
The Senate Community Affairs Legislation Committee recommended last year that the system be overviewed and monitored, and I believe that that is important. I understand that the Minister for Employment and Workplace Relations has accepted the recommendations for a mechanism that reports to parliament on the way in which these changes operate. Personally, I think we need to see the system in operation in order to be able to gauge just how well that transition has been made. I know that some would prefer to front-end load this so that no problems can possibly occur. With respect, I think that is naive. We are not going to be able to do that. What we need, however, is a capacity to acknowledge when things do not work and to make changes when that is appropriate.
That is my sense of the response that the minister gave to the report. I certainly will take that approach as a representative of this territory in my discussions with the minister in identifying what issues arise for my constituents in facing that transition. I hope that that will be a phenomenon repeated across other parts of Australia. We certainly owe it to our constituents to give them as much opportunity to bring those issues to our attention as we possibly can so we can help fix them. I support this legislation. It is important to provide this outcome for the people of Australia. This is about the future living standards of our community and, as such, it deserves to be supported.
The bill before us is a ‘consequential amendments’ bill and, in that sense, the Labor Party position is that we will be supporting the technical provisions in the Employment and Workplace Relations Legislation Amendment (Welfare to Work and Other Measures) (Consequential Amendments) Bill 2006. But I ask this question: consequential to what? The Welfare to Work and other measures legislation came into this place before the end of last year and was very quickly debated. It was legislation that, as Senator Humphries has just described, was going to make an overwhelmingly significant change to the way in which these issues were going to be looked at in this country. I believe that, as Senator Bartlett mentioned, it was guillotined in this place because it was agreed by the government that this had to be imposed on the citizens of Australia with effect from next month. In fact, many of the provisions of the Welfare to Work legislation will be taking effect from 1 July this year for the first round of people who are making claims, but some people on the disability support payment are already in the process of having their ongoing review activities picked up by elements of the Welfare to Work changes.
As a community, we should be able to expect, as Senator Humphries has just outlined, the participation of as many people as possible in our economy. No-one disagrees with that. What I find most offensive in the debates that we have had up until now is that from the government point of view any questions or issues that are raised about how this particular legislation will operate in practice, and any concerns raised by those people who have genuine questions about the impact of the legislation and about how families will continue to operate with reduced income, are dismissed as opposition. The people asking those questions are dismissed as people who do not understand the system. And the Labor Party are dismissed as though we do not share a commitment to encourage Australians to take an active role in the economy, to fulfil their need to work, to effectively communicate more widely in the community and to be part of an Australia that we should all share.
We have been told in this place that the best form of welfare is a job. I dismiss the term ‘welfare’; I find that overwhelmingly patronising in many ways—except when it is used specifically in legislation. Of course we want people to have the opportunity to work. Senator Humphries has just outlined extremely effectively the need for the people of our country to have greater participation in the workforce. We agree. But what we do not agree with is the particular methodology of this legislation.
We do not disagree with the consequential amendments. With all legislation, the ability to go back and look at things and impose new processes to make it better is a good one. If all legislation had a series of consequential amendments, we would be effectively working together to make the legislation better, so we welcome consequential amendments—even the very technical ones that we have before us today, which I do not think that many people who are not working in the system would truly understand the operation of. These amendments are all responding to particular issues to make sure that the thing works better.
However, what has not been picked up in these consequential amendments is the key question which we have been debating for several months and, in fact, in a way, for many generations: how do you effectively work with people to ensure that they can all share the largesse of our country? What we on this side of the chamber have from the start objected to in the Welfare to Work legislation is that there is no way that the best way to support people is to cut the amount of money they have to live on. The only element of the way in which this particular process is worked through that we object to specifically is that a key part of the Welfare to Work changes means that people are forced onto a lower living income.
We do not object to the fact that there needs to be training, support and acknowledgment to encourage people into the workplace. We do not object to the fact that there need to be closer working arrangements between the Job Network and the Centrelink systems so that people have access to the range of support mechanisms which everyone should have access to if they are seeking work. People who are now sole parents or who are now on the disability support payment should not have some special label on them when they are seeking work that says, ‘Danger, danger: needs special help.’ We are saying that the type of support in the Job Network should be available to all Australians seeking work under any provisions in our system.
The government has announced that extensive new support networks—we have not seen them working yet—will be put in place to work through the Welfare to Work processes. These special arrangements are in fact doing no more than acknowledging the need for these Australians to have some special support in their efforts to seek work. Of course we support that. We want to be actively involved in developing these programs and in ensuring that they are the most effective possible. We want to ensure that they meet the needs of the people working through the process of changing their way of living and their expectations for their daily routines—and, in the case of sole parents, balancing the particular issues involved in raising kids by themselves.
In the very short inquiry that the Community Affairs Legislation Committee held around this legislation, we received a number of submissions. They were not one-off submissions; they did not come from nowhere. The people who actually made submissions to this committee work on a daily basis with the welfare system—working with the Centrelink processes or acting as support networks for people who are sole parents or have a form of disability. The submissions were from organisations with enormous amounts of effective and practical corporate knowledge of this area. Their choice to come forward—and no-one is forced to give evidence to a Senate committee, or at least to the Community Affairs Committee—was based on two major elements: firstly, they wanted the voices of the people who are to be affected by the legislation heard in the development of the legislation and, secondly, they wanted to be a part with their knowledge and experience in whatever was happening—I think Senator Humphries used the term ‘the engineering of the process’—in regard to the government looking at the needs of people in the process of seeking work.
The department gave evidence to the inquiry and subsequently at a range of Senate estimates processes—and I think that will continue as the legislation is implemented—about their need to consult with the community and with the various agencies. That is a necessary mechanism of our system. But I want to know what the response to the consultation is when the consultation happens.
The kinds of issues that were being raised in the Community Affairs Legislation Committee inquiry were to do with concerns about the methodology of a punishment model, which is the only way you can describe a change of entitlement which reduces people’s living money: how they survive, how they feed their kids, how they pay their rent—how they actually do all those things that every person in Australia does. If you are reliant on a Centrelink payment, you know to the last dollar exactly what your fortnightly budget is—and this came out in evidence heard by the committee—because you have to work through the numerous demands that you have on your time and your budget. It was clearly put to the legislation committee that single parents actually work on a fortnightly basis to see exactly how they can dish out the money for their families. And it is the same for people with disabilities.
Within this process, of course, any incentive or support to get a higher wage and to be reintegrated into a workforce was seen as a positive element. There is no doubt about that. In reviewing the committee report today and looking at the submissions received, I found that there was not one person who came before the committee who rejected the value of a job. Not one piece of evidence said that it would be better not to work. It is a dismissive response from the government to say that any questions of objection indicate that there is no support for the issue of giving people the opportunity to have a job and a career. Getting a job in itself may be a result, but it is certainly not an incentive for people to develop, train and earn and have access to career progression. It has always been a balance. Just getting a job in itself may provide a step away from welfare dependency, but we should be encouraging people to enjoy the genuine values of a workplace and have the opportunity to enhance their income, training and skills so the job has genuine value beyond just the wage.
We need to widen our concept beyond just getting employment. We need to look at the value of employment so that we are not restating a whole range of cheap casual jobs and letting people be used in the job market in a dismissive and not particularly well valued way. That particular issue came out in the inquiry. Whilst people had no opposition to a chance of employment, they certainly did not think that the Centrelink and Job Network system that pushed them into jobs that provided no fulfilment and actually did not fit their other life needs, particularly child-care needs, was in itself the most effective way to work with the community and ensure that people who were identified by this legislation had the enhanced opportunities that we all seek.
However, the report said that there has been significant consultation with welfare and community groups on the impact of the changes. That is true. There has been consultation. The St Vincent de Paul Society, a group that consistently gives evidence at these inquiries with credentials that are beyond question, I believe, in working with people across our community who need immediate support, said: ‘I think’—and they refer in particular to people with disabilities and sole parents, who are the focus of this legislation—‘we will just find life harder than it was before. I do not think there is any doubt about that. They will come to us more seeking help and we will do our best to help them—we and the others who are there.’ Where is the government in that equation?
What we find so often in these debates is that the expectation of compassion and open communication and the expectation of what Senator Humphries defined as ‘goodwill’ are not always fulfilled in the system. The very people who are the focus of the Welfare to Work changes—and I am not convinced that that is going to be the automatic outcome of the legislation—are those who often have had the most negative experiences of the system as it currently exists. We are imposing further change on that group. Despite all the rhetoric about encouragement and support and giving people a chance to remove themselves from the welfare trap—rhetoric which we have all heard so often—the core element and the immediate impact of the Welfare to Work changes for people who are sole parents who have children of a certain age and for people currently on the disability support pension or those who will be claiming that pension after 1 July will be a cut in their fortnightly allowance.
That is a tough step to encourage continuation of goodwill because goodwill is not always enhanced by having less money to go through your daily expectations of living. What we seek as people who want to be part of the future development of our changing system is genuine communication, genuine consultation and the acceptance that there needs to be continued evaluation of these processes. In our legislative committee reform recommendations we said that this needs to be constantly reviewed and discussed, but it also needs to involve the people who are living the expectations of the legislation, the people who are currently using the system and the people who are providing the support for the people St Vincent de Paul identified.
A statement made consistently during the previous Senate inquiry on poverty in this country was that there are so many welfare agencies in this country who are picking up the immediate needs not just economically—although economically is so important—but also in terms of personal support, emergency housing, emergency support for family breakdown; all those areas where the people who are focused on in this legislation often need extra support that is provided by a range of community organisations. These organisations have the immediate knowledge and can best work with the government to enhance the program of encouraging people from a dependent model to some option to earn and be further involved in their community.
We seek the evidence that shows that punishment gets the best result. We reject that it is the best way to encourage people from welfare to a work model. There cannot be goodwill if you lead with punishment. There needs to be an understanding that there will be support, encouragement and a fall-back if things do not work out. We have found that leading closer to the date of 1 July there has been fear amongst areas of the community about their ability to succeed within this model. It also makes it a little more difficult to get goodwill clicking in if there is fear and worry about what is going to happen because of the punitive nature of the model. When Senator Humphries talked about what would be an alternate process, the best way would seem to be to have a cooperative process. Effective encouragement and effective training would be provided without necessarily punishing people at the first step, by removing immediate funding, and they would be given some security about the issues they will be facing and about what the results of the further changes will be.
In terms of where we go next, I expect there will be a series of further consequential amendments as we find out how the legislation kicks in and we see how the different layers work with each other in terms of payments, support networks and so on. It seems confronting that the marginal tax rates, which were mentioned a lot in our committee work, at this stage still seem to actively work against those people who are seeking to get back into the work force. It would seem to be an automatic challenge to those who are working in the development of further policy to enhance the encouragement financially. So not only do you lose your money as your immediate payment element but any attempt to move into the workforce is further punished by the marginal tax system so that you are working seemingly because you have to. The system is forcing you in but you are not receiving the monetary benefit that you should receive. That cuts across the enhancement of the process.
The people in this place have a genuine responsibility to the Australian community. There is an expectation that there will be change. There is an expectation also that the economic largesse that we are experiencing in many areas in this country could be shared effectively by all Australians. The way that the Welfare to Work changes have been implemented has already alienated groups of people who should be able to expect support the most from their government. If we are genuinely going to encourage people from welfare into work as opposed to one form of welfare into another, there must continue to be consequential changes to the legislation in front of us. As it stands, I do not think the work elements will be attractive or supportive for the people who are being targeted by the legislation. I do not think that we, as a government, have effectively done our job.
Debate interrupted.
Order! It being nearly 1.15 pm, I call on matters of public interest.
When rugby legend Phil Kearns accidentally reversed his car over his 19-month-old toddler in the driveway of his Mosman home in Sydney, did any right-minded person suggest or demand that he be charged or prosecuted for what was just a plain or garden variety tragic accident? Of course not, and no action was taken by New South Wales Police. So you would think that the same thing would apply when the now leader of the state opposition in Western Australia accidentally discharged a .22 rifle which injured the thumb of his adult son.
In fact Paul Omodei was charged with the heaviest offence on the Western Australian statute books relating to non-intentional bodily harm. The magistrate presiding over the case cited the Kearn’s case and, in fining Omodei, spent the conviction so that no conviction has been recorded against him today. It is clear to anyone who has any passing knowledge of criminal law in WA that Omodei had the book thrown at him in stark contrast to the Kearn’s matter in circumstances where both incidents are comparable.
So it was that more than 12 months ago now, on Wednesday 25 May, the then leader of the state opposition in Western Australia, Matt Birney, was being followed home from parliament by police. He was subsequently stopped and given a breathalyser. His reading was below the legal limit, he was found to be lawfully driving his car and he was never charged with any offence.
Notwithstanding this, the police minister announced on a radio talkback program shortly thereafter that the reading had been 0.047. It is unclear whether this reading was on the preliminary breath test or the full breathalyser where there had been a calculated reading. But the main issue in this case is the role of the police commissioner in Western Australia. He had, as he disclosed, as a matter of practice been providing briefing notes to the minister, including those relating to ‘high profile’ people. So the commissioner was at that time a conduit for information on police operational matters involving high profile private citizens to the police minister—even those citizens who did not break the law. The minister, as was always very likely, knowing that minister, misused the information to seek political advantage.
During an interview on talkback radio, when questioned as to where the minister may have obtained her information as to the breathalyser reading, the police commissioner said of the disclosure:
… look, it could have come from someone else, it could have come from a number of sources and I intend to talk to the Minister and find out. If anything is untoward about this I am happy to report back on it.
About 90 minutes later the police commissioner issued a statement confirming and confessing it was he who had disclosed the reading to the minister. That was a police commissioner playing fast and loose with the public on radio as to the facts of a political matter. What sort of commissioner would stoop to involve police in the murky depths of state party politics? This undermines police integrity and brings the office of the police commissioner into disrepute.
So it was that Jonathan Daventry was charged and put before a district court jury in March of this year. The facts of the matter are quite straightforward. Mr Daventry was alleged to have shirt-fronted and frogmarched a 72-year-old man from an office, during which event the man fell and fractured his skull. One witness gave direct evidence in support of the prosecution case. Five witnesses gave direct evidence as to the event not having taken place as alleged by the prosecution and exonerating Mr Daventry. In such circumstances one might reasonably ask: why would the police proceed with this matter? The answer lies in the fact that the office concerned was that of the federal member for Curtin, a Liberal member. Indeed, the honourable member gave evidence for the defence at the trial. Needless to say, Jonathan Daventry’s jury returned a verdict of not guilty.
I pause to note that when the police interviewed the parliamentarian—now a Howard government cabinet minister—they sought to do so on the pretext of charging the man concerned, the 72-year-old, with disorderly conduct. In other words, the investigating officers commenced an interview with a witness misleading her to believe that the matter was relevant to disorderly conduct whilst having an ulterior motive of pursuing Mr Daventry—another surreptitious piece of policing unworthy of skilled professional police investigators. So we have an overwhelmingly strong defence case in a matter pursued with great and unexplained zeal. The weight of evidence was obviously and unequivocally supportive of Mr Daventry’s version, yet a jury trial was held. Again the question has to be asked: why so much zeal? The answer is that it is political.
More amazing and shocking police conduct came to light at the end of May this year, conduct which gives rise to alarm at the integrity and management capacity of senior police, particularly the commissioner. For about 18 months the police commissioner has appeared in person on free-to-air commercial television in Perth extolling the virtues of DNA testing at crime scenes and personally looking down the lens of the television camera and telling the viewers that burglars will be arrested and prosecuted with the assistance of the relatively new weapon of DNA forensic testing of evidence.
This campaign was and continues to be founded upon a lie—that is, that DNA testing was in fact being done in a timely manner or at all. A recent report of the Western Australian Auditor-General, Mr Des Pearson, has found that during the commissioner’s nightly television appearances there was a backlog of some 37,309 unanswered requests for DNA test results dating back to 2000. The audit report confirms that this backlog relates to burglary offences. WA unfortunately has a very high rate of burglary.
So we have what amounts to a fraud being perpetrated upon the public of Western Australia by this police commissioner, who told the public that an active and successful crime detection tool was being used to fight the crime of burglary while all the time knowing that the testing was not being done. The commissioner must now explain to Western Australians whether that is due to his ignorance of the facts, his or his senior officers’ managerial incompetence in the administration of this testing regime or him simply not having the money to pay for these backlogged tests. Such developments again bring the office of the police commissioner in Western Australia into disrepute.
But all of this is mere background and contextual, because the WA Police Service has now gone one better. In 2003 a union official, a Mr Joe McDonald, an infamous and notorious member of the CFMEU, was charged with making threats pursuant to section 338A(b) of the WA Criminal Code. The penalty for this offence is imprisonment for seven years. Mr McDonald has a significant track record of intimidation, violence and union thuggery on commercial construction sites in Western Australia. In 2001 he lost his permit to enter industrial sites which have federal coverage after being found to have threatened and intimidated employers. In April this year Mr McDonald was stripped of his right to enter sites under state coverage following another act of violent intimidation on a building site. He was fined $800 for criminal assault arising out of this incident.
The most recent charge, the charge pursuant to section 338A(b), flowed from an incident at a construction site in 2002 wherein the police were called and some months later a detective charged Mr McDonald with an indictable offence pursuant to the section I have mentioned. The matter was listed for hearing in the district court in Perth until a state crown prosecution lawyer reviewed the matter and remitted it to be heard before a stipendiary magistrate in the summary criminal jurisdiction. The matter was then scheduled to be heard on 14 September 2004 but, because Mr McDonald was facing other charges, including assault and relating to his intimidation of people at a building site, the matter was deferred to a hearing on 21 March this year, 2006.
At the trial, several prosecution witnesses gave evidence in support of the charge and, upon closing the prosecution case, the defendant, Mr McDonald, through his counsel called no evidence to rebut the prosecution case. The defendant did, however, make legal submissions upon the law only. The presiding magistrate retired to duly consider her verdict. Counsel for the defendant was heard in the courtroom to ask the prosecutor after the magistrate had left the courtroom: ‘Will you be asking for imprisonment? Do you want a jail sentence?’ The clear inference was that a conviction was likely.
The legal argument put forward by the defence was based upon a unique construction of industrial law and in stark contrast to the understanding of most experienced practitioners and the current state of the authorities and precedent cases in this area. It is also important to note that, in not calling any evidence, the defence does not appear to have established any basis to prove that Mr McDonald was an accredited official of the CFMEU or that the union was in fact registered. These are legal formalities which would appear essential to be established if the defence submission on the technical law was to have any possibility of success.
What next occurred is one of the most perplexing events in the annals of administration of justice in Western Australia. It subsequently transpired that police prosecutors, of their own motion and without the benefit of any other legal advice, made an assessment of the defence submission and concluded that the prosecution could not succeed. Having unilaterally made a determination of the case, an application was made to another magistrate—it so happened to be the Chief Stipendiary Magistrate—to withdraw the charges. This was done with not a word to those involved in the case—namely, the witnesses or the people who had been threatened—and, of course, no word or advice to the media, which had shown much interest in the case. The charges were not withdrawn; they were ‘dismissed’, which precludes Mr McDonald ever being charged again with this offence upon the double jeopardy principle. The magistrate who presided at the trial was apparently soon to deliver her decision.
So what is so odd about this matter? Let me spell it out: an experienced police officer laid a serious charge after considerable consideration of the factual circumstances of the matter; an experienced state prosecutor reviewed the matter and sent it for trial in the Magistrates Court; witnesses gave detailed evidence in support of the charge; the defence made legal submissions only that were relevant to technical interpretations of industrial law; the magistrate was considering her verdict as the case had closed; the police gratuitously made an evaluation of the case and unilaterally resolved to pull it out in circumstances where no legal advice was taken on the matter and the dismissal of the charge was done as discreetly as possible by another magistrate; and the magistrate considering her verdict was pre-empted and the defendant cannot be charged again on the matter.
As a legal practitioner of some 25 years standing, I have no hesitation in saying that such conduct is unheard of. To intervene in a completed prosecution in pre-emption of the consideration of the presiding judicial officer is in breach of every proper principle and practice surrounding the administration of justice and our system of courts. If the police officers concerned were correct in their view of the failings of their case, the least they could have done was wait for the magistrate to find that the case had no possibility of success or for an appeal court judge to agree with them. These policemen have taken it upon themselves to be the judge and the jury. There is only one word to describe the police conduct in this matter: corrupt. I do not use this word lightly or without great consideration, but I maintain my assessment, given their conduct.
I have spoken a number of times about the record of the current government in the area of defence procurement activities. Through the work of the ANAO, we have a detailed record of a large number of exercises which have repeatedly gone off the rails. Moreover, by looking at each of these exercises individually, we see that a clear pattern of failure emerges. The French have a saying which, translated, says that the more things change, the more they remain the same. The matching of defence capability with budget is a perennial debate but one that we must have if we are to improve the current circumstances.
The first issue is the gap between government policy and the delivery of the Defence Capability Plan, or the DCP, as it is known. The second issue is the budgetary gap between funds available and the DCP. These are separate issues which emphasise a critical failure to spend and a failure to deliver. This is the hallmark of Defence procurement, and the consequence is failed capability every time delivery is delayed. The second circumstance is really one of government confidence that Defence can actually spend on time what it is granted. By its actions, it has little confidence, despite the ongoing rhetoric. The record of procurement is as bad as ever, if not worse.
The road to hell is paved with good intentions. This comes at a time when the environment for fixing these gaps has never been better. The government in Australia is awash with money and, perhaps for the first time since the end of the Cold War, we have a real new global defence policy debate. The vacuum of the last 20 years has now been filled by terrorism. Terrorism has galvanised governments around the world into serious reconsideration of defence policy and national preparedness. It is more than defence in traditional terms; it is the totality of national security. Add to this the issue of regional security created by the threatened failure of small democracies amongst our neighbours. There can be no excuse for government procrastination on defence investment decisions.
Since September 11, there has probably been more decisive decision making on national security than since the end of WWII. Decisions have been called for and made. Whether you agree with those decisions is another matter. Those decisions involve a number of interlocking, large new platforms. Army, Navy and Air Force each have major investment decisions for new ships, aircraft, land transport and supporting systems.
The question, however, that remains is not whether we can afford it but whether it can be delivered, whether it can be done. The government’s actions clearly identify their attitude. Decisions are taken swiftly where purchases can be made of proven technology and equipment from proven and established suppliers—for example, the purchase of the AWACs, the air-refuelling aircraft, the new heavy-lift air cargo planes and even the new second-hand Abrams tanks. We can be fairly certain that all of these purchases will proceed relatively smoothly. No doubt that is why the money was found so readily in each case. Indeed, it is a good argument for those who assert an off-the-shelf process each and every time. In each of these off-the-shelf buys, the strategy and policy pursued by the government were clear: supply, delivery and cost were all predictable and assured. So fiscal concerns are not always the problem. Both the elements of capability planning and fiscal reality can be easily aligned.
Given that the policy climate has been decisive, given that funds are freely available and given that there are few harmful economic consequences of spending more on defence, what then is the problem that we seem to face? Why does this issue of defence spending get so much airplay? What really prompted the secretary of the Treasury to warn Defence that the salad days cannot go on forever? The budget is in hefty surplus and will remain so for a while yet. Defence spending is flexible. It does not entail generational budgetary commitments. It supports a necessary but struggling manufacturing industry. It is leading-edge technology, which is where we need to be. There may even be, in due course, some export potential.
The evidence is clear: the government will be decisive when it is confident that the products of those decisions will be delivered on cost and on time. Money then is found without question. Global budgets, real-term increases and share of GDP are quite academic matters. I would suggest the government might commit more if it had the same guarantees on delivery each and every time, but it cannot. I would suggest that is also the public perception. I have never heard any serious grumbling about the money spent on defence when it is spent well. The costs might be awesome, but public interest always prevails: their safety and security drive the outcome. What the public object to is waste and incompetence.
So this is not really a debate about fiscal policy and competing priorities; it is about total lack of confidence in Defence to get procurement and budget management correct. I would suggest that many in Canberra have become impatient with the waste from failed procurement within Defence. Most other departments properly acquit their budgets. Few are guilty of financial mismanagement. Few get the sort of audit qualification that Defence regularly does. Yet year after year, week after week, Defence is up there in the headlines because of some scandal about waste, time over-runs, failed delivery or massive cost increases.
Even budget management itself becomes a major controversy. This is the bread-and-butter stuff which belies significant mismanagement, over the last 10 years in particular, closely followed by a comprehensive failure to account for what has been spent, what exists in stock and what future commitments there are against future budgets. On both those counts the government have failed to act, although we are now being sent a new message. We are being told they are on the job. We have all read Kinnaird. We continue to hear protestations that we have a new DMO; we have a new broom in there, there are new tough processes et cetera. The proof of the pudding, though, as always, will be in the eating.
It is certainly true that most of the existing sagas of waste and mismanagement have their origins in the recent past. I do not really need to remind listeners of them, but I will—firstly, FFGs reduced from six to four and still not one has been accepted into service, two years late; secondly, the Seasprite helicopters; thirdly, armoured personnel carriers; and, finally, others on which the ANAO will dutifully update us, with episodes sounding like Blue Hills.
I also predict that some new projects are going to have similar if not the same outcomes. The new joint headquarters at Bungendore is a project that will need greater scrutiny. Downsizing is helping to keep it within budget. But there is a familiar ring to the joint headquarters, like ANAO findings on other projects: changes to the initial specs after the initial tender was called; the government’s failure to meet its own time frames; and the jury still out on the wisdom of Defence engaging in a public-private partnership for the project. Planned efficiencies for the operation of Defence might not be realised. Defence will continue to maintain headquarters for each of the services in Sydney and the Blue Mountains as well as the new structure. The project has not even started and it already has the same smell as many others.
That is why there is no confidence in Defence. That is why any government would be silly to make grandiose commitments to future spending; such statements in the past have all come unstuck. It is not the amount of money committed in a press release that is important; it is about what is being delivered and on time. That is the fiscal reality. ‘Why is it like this,’ we constantly ask. Every Senate estimates we hear a constant refrain: Defence is different to everyone else; Defence is very big; Defence has important operational priorities which interfere with normal management; defence forces around the world are all the same; you are exaggerating, Senator; et cetera. I am afraid none of this washes.
From my perspective, one of the great strengths of a good democracy is that the government is accountable to its people for everything it chooses to do. The government is accountable for the taxes it collects and how it spends those taxes. The parliament is the means by which that accountability is achieved. Yet I find with Defence a constant unwillingness to be either accountable or responsible. The ANAO frequently tells us the same thing. Accounting for contracts let in the Commonwealth Gazette is always incomplete, likewise reports on consultancies in the annual report and likewise contracts over $100,000, reportable to the Senate. Frequently, perfectly reasonable and relevant questions on the Notice Paper are fudged with weasel words or lame excuses about an inability or unwillingness to prepare the answers.
All of that denies accountability to the parliament. It is almost as if it were a game. At the heart of it, though, is attitude—bad attitude; poor attitude. No doubt, at times that is politically inspired as probing gets a bit close to the bone. But, overall, it is a very infectious and destructive attitude. That is because the basic ethos is one of being beyond accountability, beyond responsibility. Evidence the whole sad and sorry saga of military justice—denial, cover-up and persecution. Evidence the malpractice and failure of due process in procurement, with investigations into allegations of individual corruption. They are all symptoms of an ongoing corrupted attitude. I give credit to CDF and to Dr Gumley for their commitment to rooting this out but, as they say, it is a big organisation. No doubt it will take some time. But it is those same attitudes which go to capability planning and fiscal responsibility.
I was recently admonished at estimates because I dared to suggest that the FFG project was way over original cost. I was told the increase in cost from the original estimate of around $900 million to something in the order of $1.4 billion was solely due to inflation and exchange rates. It was a case of: ‘Sorry, Senator, you’re wrong. We’re on budget.’ There was nothing said about the project being two years late already and the project being cut by one-third. I mention that simply because it is indicative of the attitude that money will always flow because it always has, and it needs to. Hence my concern that speculation is already rife that the planned air warfare destroyers will cost double the current estimate. Would that decision have been made if the cost were double? Indeed, would the FFGs ever have been upgraded if the full current cost of around $2 billion had been understood?
I regret labouring this point but, as a parliamentary representative in this democracy of ours, I am duty bound to so do. It is a real task to ensure accountability, and Defence constantly fails. Were it not for the independence and persistence of the ANAO, the parliament might never find out. That prompts me to raise the British experience of regular annual reporting against all defence capital works. Just as the Defence practice on reporting contracts is defective, so is its reporting on capital works projects. I defy anyone to produce an accurate account of what is spent on the DCP in continuity—year in, year out. At no stage is it possible to say what any particular platform is costing, either operationally or for all changes and upgrades. Projects may be reported on, depending on whether they exceed the threshold, yet in aggregate they can exceed it, and regularly do so. For example, many capital works in Army fall below the reporting threshold, but in aggregate are very large and impact directly on capability. No assessment of that kind is ever made. The government certainly would not know it, and I doubt Defence does either.
Until these issues are properly addressed, little will change. That is why I suggest we will inevitably have this very same debate five years hence. I hear the protestations, and I acknowledge a series of commitments. But I am afraid that much more needs to be spent on basic administrative systems before anything will get better. These systems need to be fixed, and it may take another five years. Until attitudes change, the more things will stay the same. This requires leadership and discipline. We are coming to the end point, where there cannot continue to be excuses for continuing failure in this area of administration.
During April this year I attended the World Ethics Conference in Oxford, England, which was an invigorating experience. The conference addressed the challenge of leadership ethics and integrity in public life. Embedded corrupt networks and cultures are very resilient. For corruption to be minimised and for ethics in public life to become embedded requires leadership, and leaders motivated by and trained in ethical conduct. Such leaders need support. In the absence of such leaders, international standards, laws and norms provide assistance in combating corruption, but without leadership and the resources and independence for monitoring and enforcement, it is hard to make progress on corruption and ethical conduct in both countries and organisations.
It will take me time to summarise the reports and information I gathered from the conference, so I will expand on the information in later work in the Senate. Today, I will focus, among other things, on the United Nations Convention against Corruption, which Australia signed in 2003 and ratified—at the last possible moment, I might add—in December 2005 and which came into force in January 2006. I will also deal with some aspects of the papers that were presented to the conference by various eminent speakers and relate these to matters which are very relevant here in Australia.
The purpose of the United Nations Convention against Corruption is, among other things, to promote integrity, accountability and proper management of public affairs and public property. Further, chapter II, article 5, states:
1. Each State Party shall, in accordance with the fundamental principles of its legal system, develop and implement or maintain effective, coordinated anticorruption policies that promote the participation of society and reflect the principles of the rule of law, proper management of public affairs and public property, integrity, transparency and accountability.
One would hope that Australia, as a signatory to the United Nations Convention against Corruption, would become an active player in the fight against international corruption. Many of the aspects of the UNCAC are covered by Australian domestic legislation, including prohibiting the bribery of national public officials—which is covered by the Criminal Code Amendment (Bribery of Foreign Public Officials) Act—and matters relating to money laundering, another matter on which Australia has been dragging its feet but might eventually produce legislation.
However, although Australia has adopted many of the recommendations of the United Nations conventions, there are still troubling areas, particularly in terms of enforcement and where the spirit of conventions is not embraced. The current investigation into the actions of the AWB in relation to wheat exports to Iraq and India would seem to call into question whether Australia takes its obligations under the UNCAC and the OECD’s anti-bribery convention as seriously as it should. We live in a global economy, so we conduct business on an international scale. The way in which we conduct that business has ethical implications and reputational implications, not only for Australia and Australian businesses but also for the countries and businesses in those countries with which we do business.
In my home state of Western Australia there is considerable exploration for resources. This exploration is conducted by multiparty ventures with transnational corporations from around the world. Many of these companies in joint venture arrangements also conduct exploration and business overseas. It is to be hoped that they conduct their business, wherever they do it, by the codes of conduct set out in the OECD and United Nations conventions. It is also to be hoped that the government applies those conventions and ensures that companies trading overseas do exactly that.
I was once told that the difference between the First World and the Third World is that the First World is efficiently corrupt. You only have to hear and read, including in our media, the alarming popular defence of corruption—that it the only way to do business overseas—to realise that ethics have a long way to go in Australia. And you can be sure someone who will bribe and cheat overseas will bribe and cheat in Australia too if they get the chance.
Several of the speakers at the conference referred to the corruption of the United Nations oil for food program in Iraq. As Dr Rosamund Thomas, Director of the Centre for Business and Public Sector Ethics in Cambridge, pointed out, the Volcker inquiry implicated more than 2,000 companies from 66 countries in illicit payments. AWB might say, therefore, that it is in plenty of company, being one of 2,000 companies from 66 countries, but the scale of AWB’s payments into Iraq have raised eyebrows all over the world. Dr Thomas pointed out that $US1.8 billion in illicit surcharges and kickbacks were diverted by Saddam Hussein’s regime from the humanitarian program that the UN had attempted to set up under the oil for food program.
I cannot pre-empt the findings of the Cole commission into the AWB, but it is not difficult to see that AWB was and is part of the problem, and is not part of the solution. It seems apparent from evidence before the Cole commission that AWB made many questionable payments. The question being considered by Commissioner Cole is whether these were facilitation payments, which could be regarded as lawful, or whether they were bribes, which could be regarded as unlawful—or whether they were both.
Under Australian law it is a complete defence if the benefit given is of a minor nature or is to expedite or secure the performance of a routine government action. This is generically known as the facilitation payment defence. It would also assist the defence of any charge if the payments were fully disclosed to auditors and relevant regulators, and proof could be provided of that. In the report on Australia’s implementation of the OECD anti-bribery convention it was recommended that the government:
... carry out the undertaking to revise the existing publicly available guidance document on the foreign bribery offence as soon as possible to clarify the defence of facilitation payments.
I for one am hoping that this revision is well under way. It is not sufficient for Australia to simply be a signatory to conventions of this nature. It must lead the way if it is to be a leader in ensuring that the rule of law and integrity in public and business life prevail with respect to our own companies and our own country’s actions.
The OECD also sought clarification from Australia:
... that the foreign bribery offence applies regardless of the results of the conduct or the alleged necessity of the payment.
Such an obfuscatory approach in Australia’s legislative drafting is odious to the spirit of the anti-bribery convention and the UN Convention against Corruption. The whole point of these conventions is to try to stop corrupt behaviour in all countries, and especially in those countries where it has become an ingrained habit or an acceptable way to get business done. If Australia and similar nations are not willing to show the way on these matters it is difficult to see how the spirit of the UN or OECD conventions can be properly implemented. The fact that there is an easy defence under Australian law regarding facilitation payments does make a mockery of what the OECD is trying to achieve.
I note that since I attended the ethics conference further questions have been raised about the actions of AWB regarding a payment of $3.3 million to a Cayman Island tax haven as part of a wheat sale to India. The whole point of the United Nations and OECD conventions is so that corruption at a global level can be tackled with cooperation between nation states with the same objective—to stamp out corruption in business dealings. With these kinds of examples you get the feeling that Australia has laws which give the appearance of supporting the United Nations’ position but in effect have a ‘nudge, nudge, wink, wink’ attitude to corrupt officials and business interests. That may be profoundly unfair but that is the impression that is circulating in many circles.
I know the Prime Minister has said that the government has done its job in relation to the AWB by setting up the Cole inquiry, but it is just not sufficient if the law is not able to be used to satisfy the outcomes of that inquiry. The inquiry was set up in the full knowledge that gross shortcomings in Australian law, with respect to bribery in this area, actually make it hard to prosecute anyone successfully, so that something that appears to be an open and transparent accountability inquiry process to the Australian people will turn into something weak when it is before the courts.
Corruption is an insidious thing. It corrupts those who pay the money or advantage and those who receive it. It corrupts the politicians, directors and people who condone it. It undermines integrity and the rule of law. It is defined as ‘the spoiling of anything by taint or disintegration’. This scandal has tainted the reputations of the directors of the AWB. Hopefully it will bring about the dismantling of that entity. Much worse is that the scandal has tainted Australia’s international trading reputation in the long term. It has also put our wheat farmers’ ability to export their quality product in jeopardy. Further, it means that Australia’s taxpayers have had to pick up the tab. Ian Wishart from Plan Australia pointed out in an article in the Age on 29 May 2006 that $357 million in aid is going to Iraq. He goes further to say that $334 million of that is going to pay off Iraq’s bilateral debt to Australia—a round robin arrangement in other words.
This debt came about because of the actions of AWB in making sales to Iraq which we now know involved facilitation payments or bribes—we will see which one Mr Cole says they were. The government was guarantor of these sales through the Export Finance and Insurance Corporation and, when the Iraq regime did not pay up, the Australian taxpayer footed the debt bill.
According to the Transparency International corruption perceptions index 2005, Australia is still within the top 10, coming in at No. 9, which, incidentally, is about where it was 10 years ago. But we are still well beaten by other OECD countries, including New Zealand and the Scandinavians. However, in light of the OECD recommendations of how Australia could amend its laws to more appropriately reflect the spirit of the OECD anti-bribery convention, in light of the expected findings of the Cole inquiry and in light of the scandal itself, I think the idea that Australia can retain this position would not be certain.
It is time for the government to respond to the OECD report on the Australian implementation of the anti-bribery convention with some speed and agility, and to domestically implement all the outstanding matters covered by the UNAC to ensure its standing in a global economy. This is a government that can move immigration laws to interfere with or try and intersect court proceedings that might be under way at this time and yet cannot do the same with respect to this issue. It is essential that the domestic legislation addresses those matters in the private sector and the public sector. Increasingly, major international business is not conducted between state entities or instrumentalities of the states. Most Western democracies in recent years have been offloading most of their utilities, like energy and water, into the private sector, so it seems next to useless to have legislation which only targets the public sector.
I concede that the UNAC only encourages states to do this but, in the context of the global economy and of Australia taking a lead in these matters rather than succumbing to the tainted business practices of some of the countries with which it does business, it would be appropriate to introduce legislation to ensure that Australia fully supports both the spirit and the letter of these conventions with respect not just to the law but to the enforcement of the law.
On 27 March 2006, I asked five questions of the Minister for Justice and Customs, Senator Chris Ellison. I asked those questions with reference to a report by the Centre for Australian Ethical Research released in March 2006 entitled Just how business is done? A review of Australian business’ approach to bribery and corruption. In answers to those questions, Senator Ellison indicated that, because of those questions and because of other pressures elsewhere, the government was moving to take action with respect to these matters. In his answer, he said:
This Government is committed to combating all forms of corruption, including foreign bribery. Foreign bribery was not an offence until 1999, when this Government introduced amendments to the Criminal Code.
The offence is punishable by up to 10 years imprisonment and/or a fine of up to $330,000.
It is good to see that Justice Minister Chris Ellison has put the top 100 companies on notice about bribery matters, as per the answers to those questions. I concede that most companies in Australia probably do conduct themselves to the highest possible standards, but it takes little imagination to see the damage that allegations against a major government backed company like AWB can have, and this impacts on all Australian companies doing business overseas. If it is considered that you can pay off one Australian company then everyone doing business is going to be confronted with the prospect of being expected to offer a bribe or being asked to launder money or to facilitate something above and beyond the contractual arrangements being negotiated. As I said earlier, corruption taints both the giver and the receiver. If Australian officials and Australian companies do not uphold the United Nations convention, and simply succumb to what these officials and companies perceive— (Time expired)
I rise to pay tribute to Rob Fisher, a much loved member of the screen production industry who passed away last month. I knew Rob through his work with Film Australia. Rob was on the board of Film Australia for six years from 1998, mostly as its chair. Rob and I had much contact regarding Film Australia. I found him to be a highly intelligent and committed person. Above all, Rob was a very decent man. I never had any dealings with him that were not marked by his professionalism and his courtesy.
Rob was a chartered accountant by profession. He entered the screen industry in the early 1980s, looking after the business affairs as the general manager of McElroy and McElroy. Rob Fisher was the founder of the First Australian Completion Bond Company, one of Australia’s leading completion guarantors. Perceiving a gap in the market, he established the FACB in 1990 and, within a few years, the FACB began grabbing a significant market share within Australia. By the year 2000, the company easily had more than 50 per cent of the market.
Rob also pushed into New Zealand, where FACB is now the predominant completion guarantor. FACB has underwritten more than $800 million worth of production in Australia and New Zealand. It has also made strong inroads into Asia, becoming the first completion guarantor to set up in Japan and having a representative presence in Hong Kong.
A memorial service was held for Rob Fisher on Monday, 15 May at the chapel of the Northern Suburbs Crematorium. A number of very moving tributes were paid to him by friends and family. Among the mourners were Jan Chapman, George Negus, Bill Bennett, Joan Scott, Tim Burstall, Hal, Di and Jim McElroy, Ian Robertson and Nigel Milan.
The industry also recognised Rob’s contribution with sentiments such as these from Sandy George, writing in the Australian newspaper:
THE Australian film industry is grieving after the death of Rob Fisher, whose financial support ensured more than half the Australian films made since 1990 got to the screen.
… … …
In business he was respected for his straight talking, his team-based approach and his unobtrusive thoroughness.
He seemed to be at every industry event and to know everyone there; the best dinner, with the best food and wine, would always be the one he had organised.
Film Australia hosted a film and TV industry memorial reception on 8 June, and around 100 people heard humorous and touching short speeches from people such as the former CEO, Sharon Connolly, film journalist Blake Murdoch, producer Hal McElroy, producer Rosemary Blight, producer Charles Hannah, Ausfilm chair Ian Robertson, Rob Fisher’s business partner Corrie Soeterboek and Rob’s wife, Janelle. There were messages also from Eve Mahlab, the former deputy chair at Film Australia; David Hannay, film-maker; and Donald McDonald, the ABC chairman. The speeches paid tribute to a good friend and colleague, acknowledging his experience, financial skills, industry knowledge, generosity, passion, discretion, support and good humour.
Rob is survived by his wife, Janelle, their children, Paul and Lizzie, and two children from his first marriage, Stewart and Llona. The Australian government joins with so many others in recognising the great contribution of Rob Fisher to the Australian film industry.
I am sure that everyone in the chamber knows that today is World Blood Donor Day. All of us have been invited to something quite extraordinary called the Prick-a-Pollie challenge, which is about encouraging members, senators and parliamentary staff to participate in Operation Lifeblood. Operation Lifeblood is about recruiting 45,000 new blood donors around Australia. I encourage everyone here who has not had a chance to donate yet to go and register with the van that is down in the forecourt of Parliament House and be part of the challenge. We all know that it is for a great cause.
But today I want to talk about something else quite exciting. Last week was Macular Degeneration Awareness Week, a national week to raise awareness of macular degeneration, which is the name given to a group of degenerative diseases of the retina that cause progressive, painless loss of central vision. The Macular Degeneration Foundation works to reduce the incidence and impact of macular degeneration in Australia. It deserves to be supported by all arms of government, especially because, as our population ages, with that ageing process comes a deterioration in people’s ability to see well. Macular degeneration is the leading cause of blindness in Australia, affecting central vision. One in seven people over the age of 50 are affected by the disease, which increases to one in three for people over the age of 75. Macular degeneration is primarily age related and most frequently affects people over the age of 50. It is sometimes referred to as age related macular degeneration, or AMD.
Of course, if your vision is impaired, your life is very severely restricted. Macular degeneration and other kinds of visual impairments affect people’s mobility, but perhaps most importantly they affect their ability to read. Help currently available for vision impaired people includes braille and talking books. Currently, the services involve the distribution of talking books to clients via an operator assisted library service. This involves an extremely labour intensive network and, needless to say, the costs associated with such a system are quite substantial. The Australian government outlays over $5 million every year for the existing postal concession, or about $250 per reader each year, to maintain and manage the talking books system.
There are also significant costs involved in supplying media material for clients and maintaining client audio equipment. It is estimated that the true cost to the community is between $800 and $900 per year per reader. As well, there are the costs in terms of client satisfaction. The current service offers a very limited range of transcribed material. When clients request the material that is available, there are substantial waiting times involved in retrieving and delivering it.
Wouldn’t it be wonderful if a blind person could read the morning newspaper on the bus like everyone else or access the latest bestsellers at the same time as the rest of the community? Well, the good news is that they can. Technology is providing some exciting new solutions and—even better—the technology that I want to talk about is Australian technology. I am talking about the Books in The Sky initiative, which is an exciting new project between the Royal Society for the Blind in South Australia and Audio-Read Pty Ltd which has just been used in a national trial. The system provides accessible information in real time. It opens up a world of previously unavailable content for the user, as well as providing great savings over traditional delivery methods. Let me explain, simply, about Books in The Sky, or the BiTS project, as it is referred to.
The Royal Society for the Blind is the main provider of services to improve the quality of life for blind or vision-impaired Australians. The RSB has a vision, if I may use that word, for people who are blind or vision impaired to participate equally in all aspects of the community. People who borrow audio books from the library will tell you that they would be lost without them. But the technology is outmoded. How much longer, for example, will we be able to use cassettes? What do we replace them with? CDs pose special problems for the visually impaired. How does a visually-impaired person know which way up to insert them or how to navigate around them? Imagine having to choose between listening to a whole CD at one sitting or continually starting again at the beginning, or just guessing where you might be by holding the fast-forward button and hoping for the best. Not good enough, you think? So did the Royal Society for the Blind. They began to look for an alternative and, after much searching, found one right here in our own backyard. Isn’t that always the way?
A privately owned Australian company, Audio-Read Pty Ltd, has created a secure system of compression, encryption and transfer of digital information. It has the ability to transfer or receive any digital information and convert it into an audio format. This means it is able to provide print-disabled readers with books or other current information at the same time as the general community. The Books in The Sky, or BiTS, system uses broadband technology to allow users to quickly and easily download material from a central computer server into a battery powered audio handset that is not much bigger than a mobile phone. The user is able to store up to 40 hours of audio content on this ‘audio navigator’ and can then easily navigate around the chapters and pages of books, or various pages and sections of newspapers.
00AOS Stephens, Sen Ursula 61
The Books in The Sky program enables multiple users across a wide area to access the same digital text at the same time, 24 hours a day, seven days a week. How does it actually work? The client or the public library contacts Audio-Read requesting the desired item. It can be a book, magazine, newspaper or any piece of print. The Audio-Read centre then processes the request. This includes scheduling the delivery time of the transmission, reporting the use of the media to the relevant publisher and, finally, uploading the file to the satellite. The Audio-Read satellite then relays the securely encrypted information to the end user, who can then access the material via their Audio-Read navigator. It can be used in business or work situations as well as in reading for pleasure.
And the client is not restricted to simply listening to the text. Just as in certain situations we all want to reread or reconsider what we have just absorbed, Audio-Read provides a secure digital multicast system that is available in indexable braille or enlarged text on a standard television monitor, as well as the audio format. The benefits are not merely social, allowing the vision-impaired person to read the newspaper or the latest thriller; the technology can also be used in the workplace, and this opens up enormous possibilities for using the talents of these people in a much less clumsy way than is now available. If you have ever seen braille machines, or heard them when print is being translated into braille, you will know the kinds of problems I am referring to, and that is not to mention the space they take up—because of the noise, they are usually in a room of their own. Compare this with the audio navigator, a device about the size of a remote control.
The BiTS system uses broadband technology, so an audio book can be downloaded in less than five minutes. Because it is digital, there is no deterioration in quality with repeated use. Books can be ordered for next day delivery and magazines are available prior to release at newsstands. An unlimited range of digital text is available for transmission 24 hours a day, seven days a week, to an unlimited distribution area—so remote areas of Australia are equally as accessible as urban centres. The other good news is that the system requires only one master copy of data, so cost and storage requirements are minimised. In fact, the system delivers data at approximately 15 per cent of the current cost of media distribution.
I know all this because the Royal Society for the Blind has just completed a national trial of the system in partnership with a number of agencies that provided clients for the trial. These partners were: in New South Wales, the Macular Degeneration Foundation and North Sydney and Maitland public libraries; in Western Australia, the Association for the Blind of WA and the Armadale and Albany public libraries; in Tasmania, the Royal Guide Dog Association of Tasmania and the Hobart and Launceston public libraries; in Queensland, the Royal Blind Foundation of Queensland and the Maroochydore, Ipswich and Townsville libraries; and in South Australia, the Royal Society for the Blind of South Australia and the Burnside, Salisbury and Mount Gambier public libraries. You will be interested to know, Madam Acting Deputy President Troeth, as will all my Victorian colleagues, that the Royal Society for the Blind was not able to arrange a willing blindness organisation to participate in Victoria so the Victorian participants were supported via South Australia, utilising broadband internet to access the books and newspaper materials.
The national pilot was very thorough: the technology, set-up, use and range of resources and financial feasibility were evaluated over a five-month period. Ninety-four readers participated through a combination of 12 public libraries and five local blindness organisations or directly via the internet. A total of 25 readers downloaded all of their materials directly via the internet. An expanded catalogue of over 1,000 books was available, as well as a selection of 12 daily newspapers and some magazines. A small number of readers were also provided with Commonwealth government information to assess the use of the system for distributing this type of information.
The federal government, I am pleased to say, supported this program, when Senator the Hon. Kay Patterson was minister for health, with a grant of $150,000 to the Royal Society for the Blind in South Australia to help it roll out the BiTS system to public libraries and other partners in several states. I understand that the Royal Society for the Blind has recently requested further support for this project from Minister Abbott, and I certainly hope that funding will be forthcoming for what is undoubtedly a very worthwhile project. Creating this kind of partnership with Australian innovators to meet widening community needs is only to be encouraged. The outcomes are clear: equity in delivery and access, enhanced services for the print disabled and cost savings in media, storage and infrastructure.
The Books in The Sky project is the first significant advance for many years in providing books, magazines and newspapers to sight-impaired people in a simple to use and cost-effective way. It has the potential to revolutionise such services and eventually replace talking books on cassette tapes and CDs. It could be phased in over time, eventually replacing the existing print disability collection over the next five to 10 years, depending on when users are comfortable with the technology.
Macular degeneration is a very significant disease in our community. It will have long-term impacts on our health budget. Most people know at least one person who has MD. There are strong hereditary factors, dietary and lifestyle impacts. You cannot change your genes or your age, but you can reduce the risk of macular degeneration and you can slow it down if you have it by making these positive changes: have your macula examined at least every five years, eat fish two to three times a week, eat dark green leafy vegetables and fresh fruit, eat a handful of nuts a week, limit your intake of fats and oils and keep a healthy lifestyle—do not smoke, control your weight and exercise regularly. You should also think about taking a zinc and antioxidant supplement, and provide adequate protection for your eyes from sunlight exposure.
For those people who have macular degeneration, the BiTS project has great potential for improving the life of those with vision impairment in our society. Think of the potential for vision-impaired school-age children as well as those with age related macular degeneration and perhaps a range of other degenerative conditions, including early dementia. We should be celebrating this fantastic innovation as one of Australia’s greatest inventions of the decade. I congratulate Audio-Read, the Royal Society for the Blind, the Macular Degeneration Foundation and Mr Tony Starkey, the project manager. I commend the BiTS project and the work of the Macular Degeneration Foundation to you all.
I rise this afternoon to speak on reports in the media alleging rape and sexual assault of detainees held in Australian immigration detention centres. I was outraged when I heard these reports last week—in particular, one which alleged that a mother in Villawood detention centre claims to have been repeatedly raped over a six-month period. These attacks are alleged to have occurred in front of her toddler, with the woman saying that she had been unable to prevent them because there was no lock on her room door. It has been alleged that this same man had also tried unsuccessfully to assault another detainee. A report in the Canberra Times on 11 June said the alleged rapist was a guard, whereas reports in other newspapers, including the Australian and the Sydney Morning Herald on 12 June, said that the man was a detainee. So it is unclear exactly who was involved in this, and I do not have any knowledge one way or the other.
Last week we also heard news that this claim, as well as other claims of sexual assault along with widespread drug use within Villawood, have been at the centre of an investigation ordered by DIMA. This investigation is headed by Mr Keith Hamburger, former head of Queensland corrective services. According to a news article in the Weekend Australian published on 10 June, a journalist from that paper obtained documents that show the investigation is covering issues including whether victims were:
... vulnerable because of “inadequate facilities, operating procedures and/or incompetence or worse by staff” ...
Mr Hamburger, who as far as I know has not yet made any public comment on the investigation, is also analysing reporting procedures, including looking at how DIMA staff handle complaints.
In addition to the alleged rape at Villawood, there have also been claims that other women and at least one male detainee and one child detainee have been sexually assaulted by guards or other male detainees. Another claim raised just this week is the case of a Villawood guard who is alleged to have sexually assaulted a former detainee when she visited a friend in Villawood last month.
Doctors who work in detention centres have claimed that sexual abuse of detainees is endemic, and it is not confined to Villawood. Psychiatrist Dr Louise Newman, who is convenor of a national alliance of detention centre health workers, has recently raised four other cases of alleged sexual harassment or assault. The first is the case of a young male detainee who told her he had been assaulted by an officer at the Baxter detention centre. The second case is an adolescent girl, again in Baxter detention centre, who told Dr Newman that officers had made sexually explicit statements to her. The third case is that of the girl’s mother, who was also subject to sexual taunts and molestation by fellow detainees but did not give this information to authorities. The fourth case that Dr Newman suspects is that a three-year-old Malaysian girl who was born in detention had been molested. Dr Newman believes that a culture of sexual harassment and voyeurism has led to widespread abuse and harassment. She has said that she would like to see the current DIMA investigation widened to include all three detention centres run by GSL. Unfortunately, there appears to be very little public information about the nature of the investigation that Mr Hamburger is conducting.
The Minister for Immigration and Multicultural Affairs, Senator Vanstone, was reported in Monday’s Australian as saying that the Hamburger investigation was due to be completed yesterday—that is, Tuesday, 13 June—and that the relevant sections would be ‘immediately’ sent to police. Senator Vanstone responded to the Villawood rape allegations that I have highlighted today by saying in an article in the Australian on Monday, 12 June:
I was amazed that such serious allegations could be raised so long after the alleged event and that at no time had the claims been referred to police ...
The woman’s lawyer, Michaela Byers, responded to this by saying that her client had poor English and had been left traumatised by the rapes—not unsurprisingly. She also said that worse than keeping it to herself would be for everyone to know about the attacks.
As Dr Newman has observed, detainees are often frightened to disclose abuse due to their fear about the potential adverse impact on their case for asylum. I find it amazing that Senator Vanstone is so amazed that detainees would fail to report rape and abuse. We all know that rape and assault committed against women is grossly underreported. Detainees especially are in a precarious position. They do not have the choices that many other women such as us have. For example, if I were afraid of someone—if I thought I were in danger of abuse—I would certainly not choose to have that person in my home. I would do all I could to make sure I was not in a position where that person had power over me. But what choice do female detainees have when the men who are allegedly abusing them are living in the same place or, worse, are guards in the detention centre? Can you imagine what sort of treatment or payback alleged victims might get if they were to dob someone else in in these circumstances? Imagine if you were a woman held in detention and you were raped in front of your child. As a mother, your first priority would almost certainly be the safety of that child.
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We do not yet know the circumstances of this case and I am not saying that this is what happened. But it is not difficult to imagine a scenario where the mother would weigh up the situation and judge that her child may be in even more danger if she were to report the assaults. Unless Senator Vanstone has no compassion and no imagination whatsoever, I find her comments, saying that she is ‘amazed’ by this situation, to be completely disingenuous. As I said, I am just amazed that anyone would be surprised that detainees would chose not to report abuse.
I also want to make a brief comment in the time that I have available on the allegations of drug use, which is obviously another area of great concern, particularly if it is occurring while children are present. I am also alarmed at the suggestion that has been made that detainees are sharing needles, as was suggested in one newspaper article, and especially the claim that one detainee who injected heroin had said that he is HIV positive.
In addition to these matters that I have referred to today, it was revealed just last week, as most of us are aware, that there are a further 26 people who have been wrongfully detained by DIMA. These people are in addition to the cases that have been so well publicised and that we all know about. What I find appalling is not just the fact this has happened again, but the fact that, again, DIMA have placed a high priority on covering this up. Of the 26 people, 11 are said to have received compensation of, on average, $74,000 on the condition that they say nothing about their detention. Again, this is another cover-up.
I have spoken many times in this place about failed immigration policy and the numerous DIMA stuff-ups and cover-ups that continue to occur. We have seen a very large number of cases of wrongful detention. We have seen wrongful deportation, widespread human rights abuses, including these latest allegations of rape, sexual abuse and child abuse that I have referred to here today. You really have to wonder what it will take for the government to take this issue seriously and fix Australia’s system of immigration detention—actually do something about what is occurring in these detention centres.
Instead of addressing this issue, looking at what is going wrong in detention centres and why there are these human rights abuses occurring, the government is taking the retrograde step of proposing that we ship asylum seekers off to Nauru. In doing so, it will be throwing out the agreement reached last year—that the Prime Minister agreed to—for removing children from detention and ensuring that children are only held in detention as a matter of last resort. What are we going to have under this proposal? More women and children in detention in a location far away. What will this do? It will have the effect of increasing, not reducing, the likelihood of abuses occurring and it will dramatically reduce the chances of abuses coming to light once they have occurred, if in fact they do happen.
I have to agree with Dr Louise Newman—we need a full investigation into abuse in all immigration detention centres in Australia. How many more examples of abuse, mistreatment, maladministration and human rights abuses do we need to uncover before we have a proper and thorough investigation and see some action taken? How many more Cornelia Raus, Vivian Solons, Bakhtiyari families, Shayan Badraies, Peter Qasims, and Hwang children need to have their lives destroyed by DIMA before some real action is taken to address what is occurring? How many more people have to develop a psychiatric illness as a result of long-term detention? How many more children have to be separated from their fathers for years on end? How many more women have to be raped? How many more children have to be abused before the government will do something?
Today I am calling on the Prime Minister and the minister for immigration to take three important steps. Firstly, Senator Vanstone must be removed. Her position as minister is just no longer tenable. Secondly, we need a royal commission into the immigration department, DIMA, and into the operation of the Migration Act. Thirdly, we need to start again with the Migration Act and the whole system of immigration detention. We have to start at the beginning, rethink the whole thing and come up with a solution which is humane.
My question is to Senator Vanstone, the Minister for Immigration and Multicultural Affairs. I refer the minister to the Senate committee report tabled yesterday into the provisions of the Migration Amendment (Designated Unauthorised Arrivals) Bill 2006. Does the minister accept the committee’s conclusions that the legislation would create ‘a new system of constructed potential indefinite detention’ and that it is ‘an inappropriate response to what is essentially a foreign policy issue’? In view of the committee’s scathing report, can the minister indicate whether the Prime Minister’s insistence this week that the bill is urgent and needs to be passed this sitting fortnight is to be reviewed? Will the government now change its plans in light of this bipartisan report that condemns the minister’s policy and recommends that the bill not proceed?
I thank the senator for her question. She refers to a committee report that was tabled yesterday. The government is giving consideration to that report and hopes to be able to respond to it very soon. I probably should not say much more than that, other than to say that, no, the government does not agree with the assertion that the bill should not go forward, but that does not mean the government is not looking at proposals put forward both by the Senate committee and by some of our own backbenchers in relation to this matter. We are looking at that and I expect that a response to the Senate committee report may not be the sole response of the government to concerns that are raised, because some of my colleagues have raised some concerns that perhaps are not clearly elucidated in that report.
We will have a look at the matter. There are a number of reviews being undertaken at the moment in relation to what practical arrangements we can make for offshore processing. For example, community accommodation arrangements are one of the things that we are looking at—
The backbenchers are not rolling over. They are not falling into line!
I am sorry, Senator. One of your colleagues has asked a question and, with respect, I am trying to answer her question, not yours.
Senator Crossin, you asked if I agreed with a portion of the report, which I assume you quoted directly but you may have paraphrased. In any event, I do not agree with that conclusion. I will say a little on the issue you mentioned of whether this is an appropriate response to a foreign policy concern. I indicated in this chamber yesterday that any government has a range of responsibilities that have to be balanced. One of them, of course, is as a signatory to a UN convention. We have to live up to the requirements of that convention. It is well understood that the convention does not say that someone who is seeking protection has a right to where their claim will be heard, nor do they have a right to assert where the protection will be offered. What we are proposing with this bill—
Opposition senators interjecting—
through you, Mr President, to the senator who asked the question, as opposed to her colleagues, who appear to be interrupting and therefore not wanting an answer—
Opposition senators interjecting—
is that a small or, we hope, very small portion of people who currently arrive in Australia unauthorised and by boat—a small portion of the people who claim asylum in Australia—will now be dealt with under the offshore processing arrangements which have been so successful in protecting our borders. The first of our obligations that I mentioned is the UN obligation. The second obligation is border protection and the third is good relations with our neighbours.
Opposition senators interjecting—
Mr President, is this Rafferty’s rules here today?
Senator Sterle interjecting—
Order! Senator Sterle! Senator Crossin, do you have a supplementary question?
Has Senator Vanstone finished?
I was in the middle of giving my answer and I sat down so that you could raise a point of order.
I did not raise a point of order; I tried to keep people quiet.
I sat down to give you the opportunity to do that. I had not actually finished the answer.
If he was raising a point of order you must have been out of line.
Order on my left!
I will be brief. The other aspects I was going to raise are the two other responsibilities. One is border protection and the other is our foreign affairs obligation to keep good relations with our neighbours. I know of no Australian who says government should pay no attention whatsoever to good relations with our neighbours. We have a lot of cooperation from Indonesia in relation to border protection and, yes, this government does not want to put that at risk.
Mr President, I ask a supplementary question. I thank the minister for her answer. Does the minister recall the Prime Minister’s declarations as late as last week that the legislation was necessary and that it ‘would not be watered down’? In light of the minister’s response, can she please advise this chamber when the response to the report will be available, considering that the legislation is due to be debated in this chamber within the next 24 to 48 hours? Will she accept any of the recommendations of the Senate committee report or will the Senate committee process and the work of the senator’s own colleagues simply be treated with contempt?
On the subject of treating things with contempt, with respect I suggest that the good senator has treated with contempt the answer she was previously given—or has otherwise not listened or not understood.
Opposition senators interjecting—
Order! Senators on my left!
The previous answer made it very clear that the government has the report and that the government is working as hard as it can to respond as quickly as it can. I made the further point that the government is also listening to its own members who have some concerns. If the senator from the Territory regards that as treating the Senate with contempt, she might like to look at the number of bills that were guillotined through this place when Senator Ray was the Manager of Government Business in the Senate.
Mr President, I rise on a point of order. I found it very difficult to hear Senator Vanstone’s answer to that question—and I sit right behind her—because of the noise from those opposite.
When the Senate comes to order we will continue with question time.
My question is to Senator Abetz, representing the Minister for Employment and Workplace Relations. Will the minister advise the Senate of the value of the Howard government’s Australian workplace agreements to both individual workers and the broader economy? Is the minister aware of any alternative policies?
Opposition senators interjecting—
When the Senate comes to order I will call the minister. If senators want to waste question time by making interjections then let it be so.
I thank Senator Mason for his question and note his commitment to creating more jobs and higher wages for our fellow Australians. The independent evidence of the respected Australian Bureau of Statistics is absolutely clear: workers on the Howard government’s Australian workplace agreements are paid on average 13 per cent more than those on, often union negotiated, collective agreements. No ifs and no buts—that is what the official figures say.
Opposition senators interjecting—
Senators on my left will come to order! Senator Evans, you have complained to me consistently about the lack of questions you ask on your side of the parliament. If your side of parliament are going to continually interject, do not expect to get as many questions in as you would expect.
I hope you have not been intimidated by Senator Vanstone’s remarks, Mr President. Quite frankly, if the minister is going to be inflammatory, people will respond. I will encourage senators to not be baited by Senator Abetz’s misrepresentation of the facts.
As you would know, Senator Evans, it is my responsibility to try to keep order in this place and I expect senators to respect that.
It now seems that, to those opposite, quoting the Australian Bureau of Statistics is a misrepresentation of the facts.
Senator Carr interjecting—
Senator Carr, you are warned! If you interject again I will name you.
Mr President, can I suggest that Senator Evans, rather than making frivolous points of order, should be suggesting to his colleagues that they should not accept the Prime Minister’s invitations to go to lunch, because I am sure that is the reason for the noise today.
Opposition senators interjecting—
Order! The senators on my left are particularly noisy today. I ask you to come to order.
Mr President, I rise on a point of order. I would ask you to reflect on a ruling that you made a short time ago, when you mentioned that if there were to be interjections from the opposition or other senators, so be it. I think you should reflect on those words, which you said to the chamber during question time. The response of senators is hardly surprising given that you have uttered those words.
Thank you for the advice, Senator. But it is my responsibility to try to keep order in this place, and I will do it whichever way I can.
I know the Australian Labor Party do not like hearing the evidence not only of the Australian Bureau of Statistics but also of workers—workers such as Graeme, a Queensland coalminer who is earning more than $100,000 a year on his Australian workplace agreement. Today in the Australian he said:
The system works. If a person is prepared to work, he keeps his job ...
Or how about Jason, a mill operator, who is on an AWA and earning more than $70,000 per annum? Today he said:
It is a pretty sweet deal ... I don’t have any problems negotiating directly with the people who employ me—and I really don’t think many people do.
That is pretty clear, you would have to say. But today, typical of the Labor Party and union campaign, they yet again rolled out their favourite union bard and chorister, Mr Peetz, singing the same tired old Labor tune. Could I simply suggest that, when the people of Australia have a choice between Mr Peetz or the Australian Bureau of Statistics, they might go for the Australian Bureau of Statistics.
Senator Mason also asked me about alternative policies. Unfortunately for Australians who want a job, who want to earn more money and who want more flexibility, the instruments that more than anything else have allowed that to happen, AWAs, will be abolished under Labor. I remind the Senate and suggest to those opposite, before they engage in their affected jeering, that in October 2005 their very own leader said:
There will be a million of those things—
AWAs—
in place when we come into office, and you can’t wander round cancelling contracts.
Yet, all of a sudden, after a secret meeting with Unions New South Wales, you can rip them up. Talk about flip-flop. Talk about weak leadership. It is a desperate bid by Mr Beazley to ensure that his own employment contract with the Labor caucus is not ripped up. That is the reason he is doing what he is doing. And in so doing—in protecting his own job—he is willing to sacrifice the hard-earned wage increases and extra jobs that have been won by so many of our fellow Australians. (Time expired)
My question is to Senator Vanstone, Minister for Immigration and Multicultural Affairs. I again refer the minister to the Senate committee report on the Migration Amendment (Designated Unauthorised Arrivals) Bill, which recommended that the bill should not proceed. Did the minister note from the report’s findings that the offshore systems of identifying initial refugee status lacked independent scrutiny because they were made by her departmental officers and only able to be reviewed by other departmental officers? Wasn’t it this lack of transparency and independent review that led to the wrongful detention of Cornelia Rau, Vivian Alvarez Solon, Mr T and at least 26 other Australians? Can the minister explain why she wants to persist with a flawed offshore system in the bill, which lacks the fundamental requirements of transparency and independent scrutiny?
I thank the senator for the question. Yes, I have noted some comments at least in relation to independent assessment. I also remind the senator—through you, Mr President—that the outcomes for a yes on Nauru in relation to the UN case load and the Australian case load, as I am advised, were pretty much the same. If not, the Australian case load—that is, that done by Australian departmental officials—was about the same. In other words, they got as good an outcome as the United Nations High Commissioner for Refugees would give them. So I take note of all those pieces of information.
Senator Kirk, you mentioned a number of cases out of the many thousands you know that the immigration department handles onshore. It might be a matter for reflection that those cases happened despite the fact that there is a legislative framework around which those cases are handled. There are migration series instructions; there is the human rights commission and the Ombudsman. Onshore handling of these cases is one of the most regulated, reviewed and spotlighted areas of government policy. Senator, the proposition you put to me is that you want more regulation in another area; yet you raised by your own example that that will not always produce the ideal outcome. We aim for the ideal outcome; of course we do. But when there is a system that aims for an ideal outcome, how does it do that? It focuses on it when it gets a problem. With respect, Senator, you have asked a question about offshore processing and related it back to onshore processing. Sorry, it seems to me to be impractical.
Mr President, I ask a supplementary question. Is the minister aware of the requirement in the Migration Act for reports from the Commonwealth Ombudsman on persons held in detention for more than two years? Can the minister confirm, as found by the Senate committee, that this requirement does not apply to persons held in offshore processing locations like Nauru? Can the minister explain why, under the bill, the Ombudsman has not been given full and proper access to offshore processing centres to provide a proper level of independent scrutiny and transparency?
I thank the senator for her supplementary question. It is my view that the Ombudsman has jurisdiction with respect to Commonwealth officials, wheresoever they operate. It is also my view that the Ombudsman has jurisdiction with respect to subcontractors working under the direction of the Commonwealth. I will get that looked at, to make sure that my view is correct. But it is a view I am not alone in holding. If that view is correct, it would beg the question of why you would spell out what the existing rights are. It is my view that the Ombudsman already has the right to comment on and report, publicly or privately as he chooses, as he wants. You ask me, why isn’t it spelt out? I have just said to you that the Ombudsman has the oversight right already. If your question then is whether we will require him to make some reports, we will give some consideration to that.
My question is to the Minister for Immigration and Multicultural Affairs, Senator Vanstone. Will the minister update the Senate on the government’s reforms to the working holiday maker visa system and the benefits for the community, particularly in regional areas?
I thank the senator for her question. Being from a regional area herself, she no doubt has an interest in this area. Working holiday makers come to Australia; they are great tourists. They spend quite a lot of money—perhaps not much each day, but they stay for a long period. So their net spending, in tourism dollars, compares very favourably with short-stay visitors from wealthy backgrounds. So we welcome them to Australia. They also as part of a working holiday want to undertake some work and can be a great assistance to us in rural areas and in restaurant, catering and tourism areas. We introduced further reforms to the working holiday maker system to benefit industries and communities in rural and regional Australia so that people who have worked for three months—not just in agricultural areas but in some of the fishing areas and a broader range of agricultural activities, all associated with rural activities but not just horticulture—will also be able to get benefits.
Backpackers who work in a range of those industries can now apply for a 12-month working holiday visa, and they will be able to work with one employer for up to six months rather than the current entitlement, which is three. Already over 2,000 people have applied for this. That is an extra 2,000 people working in Australia, helping get the crop off the vine or the tree or wherever and off to market.
I am a bit surprised that senators opposite have not complained about cheap labour coming into Australia by way of working holiday makers, and I expect to see Mr Beazley coming out with a policy saying: ‘We’re going to cancel our working holiday visa agreements. Yes, we’re not going to have them anymore because they bring in cheap labour. And never mind that Australians will not get opportunities because we do that!’ I expect that is what they will do, because after all they are just interested in looking after their own. They are not interested in building a bigger and stronger Australia. They are not interested in helping industry get the job done so that Australian jobs are secure. No, if you come from Bombay, Beirut or Beijing, watch out—you will not be welcome here! That is the view that is expressed opposite. We have working holiday makers coming from about 17 countries all over the world, and we intend to welcome them.
Seasonal harvest labour shortfall industries will be particularly grateful for these changes. Regional growers continue to register interest in seasonal workers through the Harvest Trail website. As I indicated earlier, harvests are picked and sold, but there is great benefit not only to the economy through the crop being marketed properly but, of course, from the tourist dollars that go there. It is an initiative that again underscores the government’s commitment to look at any labour shortages that are felt very acutely in the regions and to fix them.
It might not be understood what a great benefit this change will have for other industries—for example, nurses and midwives. It going to have a very significant benefit for the health system because lots of nurses and midwives come to Australia as working holiday makers. They work in a hospital for three months and then they have to move on and go to another one; now they will be able to stay in the same place for six months. That will be of benefit to the hospitals, but it will be of benefit to the whole community as well. There will be a more stable workforce and more skilled health professionals available to work in Australia. I am pleased that Professor Debra Thoms, the chief nursing officer of the New South Wales department of health endorses this government policy. She is very pleased that we have the New South Wales department of health endorsing a government policy, as of course they do for the use of 457 visas.
My question is to Senator Vanstone, the Minister for Immigration and Multicultural Affairs. Does the minister recall her media statement on 1 May 2006 where she announced an increase in the minimum salary for foreign temporary skilled workers? Can the minister confirm the relevant regulations provide for a minimum gross salary of $41,850 per annum but fail to specify a minimum hourly rate? Can the minister also confirm that there is nothing in these regulations to prevent employers from forcing temporary workers to work unreasonable hours in order to earn that minimum salary? Can the minister now provide a guarantee that no 457 visa holders are being forced to work more than 38 ordinary hours per week in order to reach the minimum salary level specified in the regulations?
Thank you for the question, Senator. As I have explained in this place on a number of occasions, there is a requirement that anyone who comes in on one of these visas is employed under Australian industrial law and is paid a minimum salary of $41,850 or thereabouts, except in regional areas where they may have—and I think this is from regulations that have just gone through this morning—a discount on that of 10 per cent. It is my view that, if someone were working exorbitant hours to earn that—and, as I said before, it is a fair day’s work for a fair day’s pay—the immigration department would regard that as a breach of the conditions.
I say two further things. If you have any evidence—and we have made this offer to the unions—of any worker being exploited in Australia, you should take that to the appropriate authorities. If that worker is here on a temporary basis, one of the authorities you might care to give the information to is the immigration department. We would be happy to make any investigation in relation to any claims that you bring forward.
Mr President, I ask a supplementary question. Isn’t it the case that there is nothing to stop employers from forcing foreign temporary workers to work unreasonable hours at less than the minimum hourly wage? Does the minister believe that such employers are in breach of the government’s workplace laws? If they are, can the minister also indicate whether she plans to do anything to close this outrageous loophole and when?
Senator, you asked me about this matter, and I have given you what I think is the appropriate answer in relation to this. I have asked you if you have any information that anyone is being—
Opposition senators interjecting—
Order! The minister is trying to answer the question. At least give her a chance to do so.
Senator, what I have said to you is that, if you have any evidence of this, come forward and give us the information of a factory that you allege is engaging in this type of behaviour. I have given you a commitment and, if you come forward with that information, that matter will be very promptly investigated. That is what I have told you. Will you give us the information? I will look forward to having your phone call after question time.
My question is to the Minister for the Environment and Heritage, Senator Ian Campbell. Will the minister inform the Senate of recent claims about the coalmining industry? Further, will the minister inform the Senate about the importance of this industry to the Hunter Valley and Newcastle?
I thank Senator Heffernan for an important question. Indeed, I think most Australians would know that the coalmining industry is an incredibly important industry not only to Australia but also, because it supplies very high-quality coal, to many parts of the world. As I said in answer to a question in relation to uranium yesterday, it is in fact a service that Australia does for the world in relation to its rich energy resources, including natural gas, coal and uranium. We provide the world with energy as well as provide jobs for Australians.
In the Hunter Valley and Newcastle, which Senator Heffernan referred to, I am informed that something like 6,000 people are employed directly in that industry, contributing something like $4 billion to the local economy. That is why I was alarmed to receive a letter recently from a Labor Party member of this parliament that opposed the construction of the Anvil Hill coalmine at Wybong. The Labor Party member of parliament describes the Hunter as:
One of the world’s carbon capitals and home to a rapacious coalmining industry.
The member goes on to say:
Anvil Hill is a key part of the Hunter Valley coal export expansion, which needs to be stopped if the world is to avoid climate change.
That is a letter you would possibly expect to receive from Anthony Albanese. It is a letter you would possibly expect to receive from Peter Garrett or other members of the Labor Party who have not done their homework in relation to the energy and climate change challenges facing Australia and the world. But to receive the letter from a member from the Hunter—one Kelly Hoare, the member for Charlton, who has the audacity, having put her name on this letter, to in fact have a headworks on her letterhead—is the ultimate in hypocrisy.
We know that the Australian Labor Party is totally confused in relation to energy and climate change policy. You have Mr Garrett going in one direction on uranium. You have Mr Albanese going in another direction. You have Mr Ferguson going in another direction. We know that they are all over the place on uranium. As I described yesterday, there is only one single source that they have really signed on to—it is not uranium; it is pandemonium.
Here we are, knowing full well that the world needs reliable energy. Australia has an opportunity not only to develop its solar energy resources, its wind energy resources and its geothermal resources in getting steam off hot rocks but also to lead the world in terms of energy efficiency, appliance efficiency and water efficiency labelling; to lead the world in reducing deforestation and planting plantations of forests which chew up carbon at a great rate; and to have a portfolio approach addressing climate change in an integrated and multitrack way through energy efficiency and renewables and now, of course, looking at our part in the nuclear cycle.
But you have Labor ruling out uranium mines and getting rid of 20,000 jobs yesterday. Today you have a member representing the Hunter Valley, one of the world’s greatest coal provinces, ruling out coalmines, trying to close down that industry and taking out tens of thousands of jobs, when we know in fact that cleaning up coal, developing clean coal, capturing carbon from coal and geosequestering it are some of the many strategies we must pursue if we are to save the globe from dangerous climate change and provide the world with the energy it needs. Kelly Hoare should rest her head in shame. I table the letter.
My question is to the Minister for Justice and Customs, Senator Ellison. American historian Professor Alfred McCoy says that Guantanamo Bay is a place specifically designed to psychologically break detainees. Does the minister agree that the prolonged use of solitary confinement and sensory deprivation qualifies as torture? Why is David Hicks still there, 4½ years after his arrest?
I can tell the Senate that, when I visited the United States in the last fortnight, I raised the issue of Mr Hicks with the United States attorney-general, as I have done on previous visits to that country. I reinforced Australia’s earnest desire that Mr Hicks be brought before the military commission as soon as possible. Of course, we have an appeal pending in the United States in relation to the validity of the military commission in question. That has been ongoing now for some time. It is the case of Hamdan v Rumsfeld, as I recall. The attorney-general of the United States indicated to me very clearly that it was their view that a decision should be handed down as soon as possible. I understood that that could well be in the very near future. It certainly was his desire that that be dealt with as quickly as possible.
But it is a matter, after all, before the courts in United States. Like this country, the executive does not have the ability or power to interfere with the way the courts conduct their business, and quite rightly so. The US authorities and their attorney-general indicated to me that, in their opinion, it was something that should be dealt with as soon as possible. In relation to Mr Hicks and his situation in Guantanamo Bay, I understand that consular officials visited him on 8 June this year. He was found to be well and in good spirits. Indeed, he has been visited on 16 occasions over the period of time he has been in detention there.
Who by?
Consular officials have visited Mr Hicks. We have also had Australian authorities visiting him. He is not in solitary confinement.
I think you have been misled if you are saying 16 visits by consular officials.
There have been 16 visits involving consular officials and Australian authorities.
You had better get that checked out.
Mr President, if Senator Faulkner wants to cavil with the point of 16 visits, I will check on that. But that is my clear—
Senator Faulkner interjecting—
Order! Senator Faulkner, if you have a question you can ask it in the normal fashion, not by interjecting across the chamber.
I can say there have been 16 visits to Mr Hicks by consular officials and/or Australian officials. I do not see that there is any difference in that. If Senator Faulkner thinks that Australian authorities are in the business of subjugating Australian citizens, he ought to apologise to them, because I can say right now that, in anything that our agencies are involved in, they look to the interests of Australian citizens as well as the task they have at hand. To indicate that a consular visit is in some way different to a visit from someone from an Australian authority is by implication saying that they are not fulfilling the same standard of duty that a consular visit would. I totally reject that, and he should be ashamed of himself.
Let us get back to the issue at hand. Mr Hicks is not in solitary confinement. We have been monitoring his welfare closely. When he was last visited on 8 June he was found to be in good spirits and well. We will continue to monitor his position. We will continue to represent to the United States government that this should come on as soon as possible. But you have to remember that it is legal proceedings in the United States that are preventing the military commission from taking the proceedings before it. That application was brought by others in Guantanamo Bay. (Time expired)
Mr President, I ask a supplementary question. I ask the minister to define what he means by David Hicks not being in solitary confinement. Minister, there have been three suicides recently at Guantanamo Bay. Professor McCoy says that this system of total psychological torture is designed to break down every detainee. It is designed to produce a state of hopelessness and despair that leads in this case to suicides. The International Red Cross, the United Nations Committee against Torture and even the FBI now say that America is torturing detainees at Guantanamo Bay. Why is your government allowing its great and powerful friend to torture Australian citizens?
I completely reject that. My previous answer outlined very clearly the approach of the Australian government to this matter. We have had 16 consular visits to Mr Hicks—and I stress consular visits. We have actively monitored his welfare. We have not found any evidence whatsoever that he has been the subject of torture and, of course, we as a nation totally reject torture being used in any situation. Could I say that, in relation to this matter, we have taken particular care and attention to ensure that Mr Hicks’s interests are looked after. The reason why he is not before the military commission is not of the making of the US government or the Australian government; it is because proceedings have been brought in the courts in the United States in the case of Hamdan v Rumsfeld.
My question is to the Minister for Justice and Customs, Senator Ellison. Will the minister update the Senate on the Howard government’s efforts to combat the abhorrent crimes of sexual servitude and sex trafficking?
Last week we saw the conviction of a 44-year-old woman in relation to five charges of possessing a slave, five charges of exercising a power of ownership over a slave—
Only one?
I realise that Senator Allison from the Democrats is not interested in this, with her interjection. Could I say that this is a very important situation, where, in a modern-day environment, in Australia, in a developed country such as ours and in the world that we live in today, we have someone being convicted of slavery. That is a matter which is repugnant to the government and to the people of Australia. What it does show is that we are taking action to crack down on trafficking in people, which one would think would not take place in today’s environment, but unfortunately it does.
I will continue with my previous remark, which involved the conviction of a 44-year-old woman, who was convicted of five charges of possessing a slave and five charges of exercising a power of ownership over a slave, under the slavery provisions of the Commonwealth Criminal Code. This was the first conviction by a jury under the new legislation. Can I say that it was, in fact, the second conviction in that a first conviction, that of a co-accused, was obtained in December 2004. That was on a plea of guilty. It was suppressed by order of the court and, of course, it could not be publicised. What it does demonstrate is that the AFP is doing a very good job in working domestically and internationally in cracking down on the trafficking in persons.
Back in 2003 we set about an initiative, with some $20 million being expended on setting up a task force in the Australian Federal Police, working in our region to deal with those countries that are working with us in the fight against this repugnant trade. We placed people overseas in relation to this. What we have also done is to work with the victims of this vile trade. In relation to that, we have provided criminal justice stay visas for those who can give evidence and assist us in achieving convictions as a result of subsequent prosecutions.
It was just last year that we introduced further laws to crack down on this trade. On 3 August last year, we introduced laws which comprehensively criminalised this activity. As a result of feedback from law enforcement authorities and the DPP, we amended our laws to assist our authorities in prosecuting and bringing to justice those responsible. We introduced debt bondage offences to prevent traffickers from using unfair debt contracts and other similar arrangements to force their victims into providing sexual services or other labour to pay off large debts. We also expanded deception offences to include all types of deception in recruiting persons to provide sexual services. This expanded the ability of Australian law enforcement authorities to crack down on and catch those people who are involved in this sort of activity. We will continue to do so.
There are a number of prosecutions pending. We are working with countries in the region. Indeed, in visits to the region, I have raised with my counterparts Australia’s firm resolve in relation to cracking down on this trade. Indeed, in Washington in the last fortnight, I raised this with the TIP office, which conducts an annual report on people trafficking—a report which described Australia as a prominent leader in many regional projects aimed at combating people trafficking. I think that that is an important recognition of the work we do, but of course there is still much work to be done, and Australia will do that.
Order! I draw the attention of honourable senators to the presence in the President’s gallery of Mr Sam Abal, Parliamentary Secretary for Intergovernment Relations from the parliament of Papua New Guinea. On behalf of all senators, I welcome you to Australia and particularly to the Senate.
Hear, hear!
My question is to the Minister for Immigration and Multicultural Affairs, Senator Vanstone. Can the minister confirm that employers have to make a specific case before they can engage a worker on a temporary skilled migration visa? Can the minister explain whether there are any safeguards in place to ensure that these workers are actually employed in the specific field set out in their visa application? Isn’t it actually the case that there are no restrictions on what employers can force temporary skilled workers to do or even what industry they are employed in once they are in Australia? Doesn’t this totally undermine the case for these skilled workers being needed by particular employers in the first place?
Thank you, Mr President. I am just looking—I did get it out quite deliberately. I thank—what is her name?
McEwen, I think it is. Ask Mr Beazley—he will know.
I thank Senator McEwen for her question. Senator Campbell reminds me that I am not the only one who cannot remember who Senator McEwen is!
Honourable senators interjecting—
He is having a bad day. I take it back, Mr President. That was not nice.
Honourable senators interjecting—
Order! Senators will come to order. The noise level is too high. A question has been asked of the minister. I would ask you to come to order.
I am conscious of the fact that a word once written can never be unread and a word once spoken can never be unsaid, but I do apologise to Senator McEwen. It was unfair of me to have a go.
I don’t need your apology.
I know you do not need my apology, because I could see the goodwill with which you took my comment. I in fact saw you laughing. So you have that great Australian trait of being able to laugh at yourself—which is welcomed.
The question that was asked was: are there any mechanisms to ensure that people are working in the areas for which they make application for a skilled temporary migrant visa? I think the fair answer to that is yes. Obviously, the people making the application have to convince the department that it is appropriate. We reject a lot of applications because, for example, the training commitment from a company is not there. In fact, one of your own colleagues—who is not here today—made a request that we place a 457 worker with a company, and we were not able to do so because the company did not have an adequate training record. There are plenty of occasions where we in fact reject applications on that basis. Unfortunately, your colleague did not put it in writing—otherwise, you can be sure, Senator, that you would be reading the correspondence in the paper.
There is obviously the primary requirement that you tell us what you are going to do, and you are expected—just as you are in any other aspect of dealings with government—to live up to the commitments you make by way of application.
Are you warning that any correspondence we send to you will be leaked by you? Is that what you are saying?
Order! Senator Evans, it is not your question. Come to order!
Mr President, on a point of order—
There is no point of order. Resume your seat.
I have not made the point of order.
Resume your seat unless you have a point of order.
I have a point of order.
What is your point of order?
My point of order—and I apologise, Mr President, as I should have raised it with you directly—is that Senator Vanstone suggested that she would leak any written request made to her by an opposition member. I object to the suggestion that she would abuse her ministerial position in such a way, and I want her to confirm whether that was what she was really saying.
If Senator Vanstone did say that, I did not hear it for the noise on my left.
We heard it all the way over here.
I did ask you to come to order. I ask Senator Vanstone to resume her answering of the question.
In addition to the commitments that are made in the application, there is a process of review over the first year where companies are required to report back and there is also an arrangement for site visits. As is the case with any compliance matter, such as, for example, the number of containers coming into the country, Customs do not inspect every container. Why? Because they work on the basis of targeting their compliance work, as in fact we do. In addition to that, there is the consequence of someone not living up to their commitments. That consequence may well be losing the right to sponsor further workers. Since this visa is very much appreciated in industry, you will find that people are not keen to lose the right to sponsor.
Do I expect that the New South Wales Department of Health will put in an application for a psychiatrist and ask the person to sweep the floors? No, I do not. Do you know why? Because, normally, industry put in an application for the workers they need, and they want those people to do those jobs. Why? So they can deliver better services and make Australian companies stronger and Australian jobs more secure. Australian jobs have never been more secure than they are now—thanks to good management of the economy and thanks to us not engineering a recession that we thought Australia had to have.
Mr President, I ask a supplementary question. Can the minister confirm that her department’s investigation into foreign workers at T&R meatworks at Murray Bridge in South Australia found that the majority of these workers were found to be working in unskilled areas in breach of their visa conditions? Can the minister table her department’s report on this case? Can the minister explain whether T&R meatworks has been subject to any penalties and, if so, what the penalties are?
There are some further matters that are being looked at in relation to that particular meatworks, but on any occasion where we find that someone is not doing the right thing and I am subsequently asked about it, I will make clear what the answer is. I do not think that should be hidden from anybody. We do not want this visa to be misused; we want the visa to continue.
But, when members opposite get up and raise allegations, I would welcome them also saying, ‘Gee, that was incorrect’—for example, in relation to the allegation that Indonesians were being paid $20 to $40 a day to dig ditches in my state of South Australia, when in fact $60 a day was the bonus payment and they were on salaries of over $50,000 a year. And we ask ourselves why the Advertiser digitised out the face of one of the people in the media. I believe the Labor Party knows the answer to that, because they know who was in the photograph. They know who gave the Advertiser the incorrect information, and they do not want anyone else to know who it was. (Time expired)
My question is to the Minister for the Environment and Heritage, Senator Ian Campbell. I refer to the proposed BGC brickworks under consideration on Commonwealth land at Perth Airport. I note that it was reported in the West Australian today that the minister is refusing to release his advice to the Minister for Transport and Regional Services. Can the minister confirm that he has provided advice to the Minister for Transport and Regional Services? Can the minister outline the general nature of his advice to the minister? Can he inform the Senate why he will not release his advice to the public?
The point we make is that that is in fact advice to the minister for transport, who will make a decision about the proposal. I believe that that process should be allowed to run. The point I want to make about the process for the analysis and investigation of the proposal is that it is an incredibly thorough one. It has the most detailed public consultation of any statute in the land. It is in stark contrast to the Western Australian Labor government’s failure to do any sort of investigation into the approval of two kilns less than a kilometre away. The state Labor government approved the expansion of two kilns at an existing brickworks with no approval process whatsoever.
These are brickworks with emissions that are probably five, six or seven times bigger than those in the proposal that is before Mr Truss at the moment. As I said, expansions were approved with no public consultation. That is very embarrassing for the Labor Party members here. We have subjected the proposal by the WA Airports Corporation to a thorough environmental examination. That examination has been provided to Mr Truss, and I have made it quite clear to anyone who has asked that when Mr Truss makes his decision—and that is due in the next couple of months—I expect that the report that I have provided to him will be made public. But it would be a breach of process—
Senator Sterle interjecting—
Senator Sterle, you have been particularly noisy during question time today. I ask you to come to order.
It is not unusual for the Labor Party members from Western Australia to squeal very loudly about this, because when the environmental report is released it will show the incredible dereliction of environmental duty by their comrades in the WA state government. It will show that they have approved massive expansions of the brick production capacity in the Swan Valley without any environmental approval, without any public consultation and without any possibility for the residents of Hazelwood or the Swan Valley or any of the suburbs near the existing brickworks to have a say on it. Yet they want to score cheap political shots here. The Australian Labor Party members in the state parliament and in this parliament will be deeply embarrassed when my environmental report is released.
Senator Chris Evans interjecting—
I look forward to releasing the environmental report, because it will be deeply embarrassing to the windbag opposite and deeply embarrassing to the Australian Labor Party. I look forward to Mr Truss’s decision and I look forward to releasing my report.
Mr President, I ask a supplementary question. I note that in fact, according to the brickworks environmental review into existing brickworks carried out by the WA Department of Environment in 2003, emissions of hydrogen fluoride, hydrochloric acid and particulates repeatedly exceeded national health and safety guidelines and that, on at least one occasion, particulates emissions were 10 times the national safe level. How can the minister be confident that additional health impacts from the proposed BGC brickworks will not expose the company or the Commonwealth to compensation claims?
I think that Senator Siewert makes my case. We have a report of the state EPA into the existing brickworks which shows that the state Labor government, who have the audacity and the hypocrisy to criticise me for going through one of the most robust and thorough environmental assessment processes available within the Commonwealth of Australia, do not enforce their own rules. They do not allow public consultation and they do not enforce their own rules. I suggest that the senator awaits Mr Truss’s decision. I am quite sure that that will be made well within the statutory time frames. I will be very happy—as long as Mr Truss is happy, and I am sure he will be—to ensure that my full report is released to the public.
So you have to do what he says?
It is in fact advice to him, and it is entirely appropriate that he makes that decision. But, as I have said, the report will embarrass the Labor Party severely, and that is why I look forward to releasing it and showing them as the deep hypocrites that they are.
I think you referred to someone in an unparliamentary manner. I ask you to withdraw.
The entire Labor Party, Mr President.
No. I ask you to withdraw.
It is not appropriate to call the Labor Party a bunch of hypocrites?
It is unparliamentary.
I am happy to withdraw.
My question today is to Senator Minchin, the Minister representing the Prime Minister. Can the minister indicate exactly when the Prime Minister directed the ACCC to monitor petrol prices over the June long weekend? Will the ACCC’s report be made public and, if so, when? Is the minister aware that across New South Wales petrol prices spiked by 10c a litre last Thursday to an average of $1.45 in Sydney and up to 6c higher in regional areas? Isn’t it true that these price hikes have nothing to do with the sudden increases in international oil prices, as the Prime Minister tried to claim last week? Is the minister aware that in Western Australia it was not a long weekend and that there was no 10c a litre price increase? Don’t motorists have every right to be cynical about the timing of petrol price increases when they keep being slugged at the start of every holiday period? Don’t they have a right to be cynical about yet another review into petrol pricing?
What the public has a right to be cynical about is the Australian Labor Party trying to play politics with the issue of petrol pricing. That is an extraordinarily cynical thing for the Australian Labor Party to do. Having been a party in government, they know full well that the price of petrol is directly a function of the price of crude oil, which has in fact increased substantially in the last year or so. Yes, it is true that crude oil prices are very high. That is reflected, as is always the case in every country on this planet, in higher prices at the bowser. We have no magic wand to change that. We have no effective means of ensuring that the mechanism by which supply and demand interact to determine the price of oil can be changed by waving a magic wand.
The government are extremely sympathetic to ordinary Australian families, who are bearing the brunt of those prices. We do not like it any more than they do. We wish that petrol prices were lower. We have acted to ensure that there is no upward driver of petrol prices on the part of the federal government by ending Labor’s indexation of the excise on petrol. We removed that indexation in 2001. At the same time, we lowered the excise itself so that the tax on petrol is now considerably lower than it would have been if we had simply maintained the Labor regime of indexing the excise and keeping the excise at the base level at which we inherited it.
We have constantly asked the ACCC to ensure that it does monitor petrol prices to make sure that there is no undue, improper or illegal activity. The ACCC regularly reports that it can find no evidence that petrol prices are unfairly pushed up by oil company profiteering. This is a highly competitive market. There are many retailers, most of them operating on very small margins. There has always been and probably always will be, given the nature of petrol retailing, considerable fluctuation in the retail prices that consumers find. As with most markets, the only advice that we can give to consumers is to ensure that they monitor the prices and that they do frequent those petrol stations that keep their prices low—that they go to those petrol stations which are offering competitive prices. We will continue to ensure that the ACCC does closely monitor petrol retail prices to ensure that there is no breach of the law, no breach of the Trade Practices Act.
But I would ask rhetorically: what is it that the Labor Party is proposing? Is the Labor Party proposing some sort of federal government price control of petrol? Is the Labor Party proposing that somehow we ask OPEC to lower its crude oil prices? The Labor Party has no answer to this. The Labor Party is just cynically exploiting consumer concern about this. The Labor Party can tell its own state governments to do what the Labor Party in Queensland—
Mr President, I rise on a point of order that goes to the question of relevance. The minister has had most of his time so far to answer the question. The precise question went to the Prime Minister’s announcement about ACCC monitoring last weekend. It also went to the comparison between the $1.45 in Sydney and the 10c not being applied in Western Australia. That is the anomaly that Senator Stephens raised in her question. The minister has made no attempt to address the question put to him and has sought to blame the Labor Party, after 10 long years of the Howard government, for everything that is wrong with petrol prices. I ask you to direct him to the question.
Minister, you have 44 seconds to complete your answer. I remind you of the question.
Thanks, Mr President. As I was saying, the Labor Party is free to say to its own state Labor governments that they can give a rebate to consumers, just as the Queensland Labor government does. There is absolutely nothing to prevent state Labor governments from giving that rebate. They are the ones much more likely to be benefiting from high petrol prices than we are, given that they receive all of the GST. Of course, there is GST on petrol, all of which goes to the states. If Senator Stephens is so concerned about it, she can say to her state Labor government in New South Wales: ‘Why don’t you provide a rebate, just as the Queensland Labor government has done?’
Mr President, I ask a supplementary question. I am flabbergasted that Senator Minchin does not understand that families are now paying more than $100 for their fuel bills to fill up their cars prior to a holiday weekend. My question is: why were people paying $1.45 in Sydney and up to $1.49 in places like Junee in New South Wales at the weekend, and in Western Australia, where it was not a long weekend, they were paying 10c a litre less?
Of course we understand that Australian families do not like paying high petrol prices. That is why, as a result of our sound economic management, we are able to provide them with substantial tax cuts and family allowance increases which assist them in meeting those costs. Mr President, I ask that further questions be placed on the Notice Paper.
On 9 May 2006 I took on notice a question from Senator Hogg. I have provided Senator Hogg with a copy of the answer. I seek leave to incorporate the answer in Hansard.
Leave granted.
The answer read as follows—
Senator Hogg asked the Minister representing the Minister for Employment and Workplace Relations, upon notice, on 9 May 2006:
Senator HOGGMr President, I ask a supplementary question. Can the minister confirm how many terminations that have occurred since the new laws took effect the Office of Workplace Services is currently investigating? How many of these investigations have been triggered by the minister? Are the outcomes of these investigations made public? And what options are open to employees where the investigations find that they were unlawfully dismissed?
Senator Abetz The Minister for Employment and Workplace Relations has provided the following answer to the honourable Senator’s question:
Question 1: Can the Minister confirm how many terminations that have occurred since the new laws took effect the Office of Workplace Services is currently investigating?
Answer: As at 5 June 2006, the Office of Workplace Services (OWS) was undertaking investigations into terminations involving 15 employers.
Question 2: How many of these investigations have been triggered by the Minister?
Answer: None.
Question 3: Are the outcomes of these investigations made public?
Answer: The OWS informs the employer and the worker(s) directly involved in an investigation of the outcome. OWS does not seek to restrict these parties from publicising the outcome. Where an investigation results in OWS litigation, a media release will generally be issued. One has been issued in every case to date. The OWS will consider making public the outcome of other investigations on a case by case basis, taking account of public interest considerations and privacy laws.
Question 4: And what options are open to employees where the investigations find that they were unlawfully dismissed?
Answer: Under the Workplace Relations Act 1996 (WR Act), it is unlawful for an employer to terminate an employee’s employment on certain prohibited grounds.
An employee can apply to the Australian Industrial Relations Commission pursuant to section 643 of the WR Act if they believe their employment was terminated for an unlawful reason.
These are set out in section 659 of the WR Act and include:
Employees who believe they have been unlawfully terminated may be eligible to receive up to $4,000 worth of independent legal advice, based on the merits of their claim. They will be eligible for assistance if they have a certificate from the Australian Industrial Relations Commission indicating that their claim has merit and could not be resolved through conciliation. The application for assistance will be assessed by the Office of Workplace Services on the basis of financial need.
Yesterday Senator Bartlett asked in a supplementary question whether I could ascertain whether Minister Brough would table in the Senate any letter of invitation that has been sent to participants in the latest summit on Indigenous violence and a copy of the proposed agenda. That matter has been raised with Minister Brough and he is happy to have those papers tabled in the Senate. I seek leave to incorporate the papers in Hansard.
Leave granted.
The documents read as follows—
On 22 May 2006 the Acting Prime Minister wrote to you inviting you or your Ministerial representative to an Intergovernmental Summit on Violence and Child Abuse in Indigenous Communities.
The Summit will be held on Monday 26 June 2006 at Room 1R3 Parliament House Canberra, commencing at 10.00 am and finishing at 4.00 pm. I have attached a draft agenda for your information.
The Australian Government will be represented by me, as Chair, the Attorney-General, the Hon Philip Ruddock MP, and the Minister for Justice and Customs, Senator the Hon Chris Ellison.
All jurisdictions have been making efforts for some time to address Indigenous family violence and child abuse. In particular, I note the considerable national effort made under the National Framework for Preventing Family Violence and Child Abuse in Indigenous Communities. I believe that we now need to further demonstrate our collective leadership on this issue.
The Summit will focus on practical measures that will improve safety for Indigenous Australians particularly women and children. While there are many contributing factors to violence and abuse this Summit will aim to tackle the threshold question of safety, law and order.
There are three areas in particular which would benefit from a cooperative, multi-lateral approach.
The Prime Minister intends that concrete outcomes from the Summit are to be listed for consideration at the next COAG meeting in July 2006. I am confident that together our governments can develop law and justice initiatives and complementary measures that will make substantial improvements to safety in Indigenous communities. I look forward to working with you on such a significant issue.
Summit on Violence and Child Abuse in Indigenous Communities
10.00am-4.00pm, Monday 26 June 2006
Parliament House
Room 1R3
DRAFT AGENDA
10:00 am—Welcome and Introductory remarks
Operation of Law Enforcement—Criminal Justice Systems and reporting in Indigenous communities
12:30 -1:00—LUNCH
Application of Customary Law within Criminal Justice proceedings
Complementary measures
(including enforcing school attendance)
Outcomes for consideration by COAG
4:00 pm—CLOSE
Pursuant to standing order 74(5), I ask the Minister for the Environment and Heritage for an explanation as to why answers have not been provided to questions on notice Nos 1708 and 1709, asked on 21 April this year.
Did you forewarn the minister of the question?
Yes, I did. I move:
That the Senate take note of the minister’s failure to provide either an answer or an explanation.
We have seen over the last few weeks a very intense debate generated by the Prime Minister about nuclear energy, but my questions go to the minister’s actions with regard to greenhouse emissions. I would have thought that this was a very topical issue at this point in time. To be precise, I asked the minister the following:
(1) What environmental taxes on cars, petrol, wood and other products have recently been imposed by China.
(2) Were these environmental taxes negotiated as part of the Asia-Pacific Partnership on Clean Development and Climate; if not, how do they relate to the Asia-Pacific Partnership on Clean Development and Climate.
(3) To what extent is China using market-based mechanisms to address greenhouse abatement and/or avoidance.
(4) To what extent is each of the other parties to the Asia-Pacific Partnership on Clean Development and Climate, including Australia, using market-based mechanisms to address greenhouse abatement and/or avoidance.
(5) To what extent is China using the expansion of nuclear power to address greenhouse abatement and/or avoidance by 2020.
(6) Does, or will, nuclear power expansion form part of the Asia-Pacific Partnership on Clean Development and Climate; if so, can details be provided.
(7) Is it still the case that Australia’s greenhouse emissions are expected to increase by more than 20 per cent above 1990 levels by 2020; if not, what is the anticipated increase.
(8) How does Australia’s increase above 1990 levels by 2020 compare with each of the other countries in the Asia-Pacific Partnership on Clean Development and Climate.
There were several other questions along those lines but, of course, we have not heard very much about the Asia-Pacific Partnership on Clean Development and Climate in recent weeks. The debate has been totally overtaken by questions about whether Australia will move to a nuclear power future and whether we will enrich uranium in this country, ignoring totally what measures would be adopted in order for Australia to reach that massive reduction of 60 per cent on our 1990 greenhouse emission levels.
I also asked the minister a related question, following his answer to another question, which stated:
The Vision Statement for the Asia-Pacific Partnership on Clean Development and Climate explicitly includes wind power as one of the areas for collaboration by partner countries. However, no decisions have yet been made on specific implementation measures or arrangements. These issues will be discussed at the initial ministerial meeting of partner countries, which will be held in Australia in November 2005.
My questions were about that meeting. I asked:
What were the results of that meeting of partner countries with regard to renewable energy.
What we do know is that the minister has stopped two wind farms. He said today that he has given the okay to one, but two have been stopped—one in his home state, at Denmark, which I happen to know was three small turbines which were set up by a community group there. He stopped that development on the spurious grounds that it did not have community support. It was put up by the community itself as part of remote area renewable power generation, which was negotiated some time ago with the Democrats. I also wanted to know:
Have the industry development mechanisms to accelerate the generation of wind power, as proposed by the Global Wind Energy Council, been agreed to; if not, why.
We have heard nothing about that. The minister tells us all about water labelling, which again is a Democrat initiative, but we hear very little when it comes to the formal procedures which should lock Australia into heading towards these massive reductions in greenhouse energy. I asked:
Have Australia’s commitments to renewables been affected by the decision to invoke the Environment Protection and Biodiversity Conservation Act (EPBC) on the Bald Hills Wind Farm: if so, how.
We have heard nothing more about that, after an initial flurry in the papers. I also asked:
Can details be provided on progress with the states and territories through the Ministerial Council on Energy to reduce regulatory and technical impediments to renewable energy uptake, with a particular focus on wind energy.
The minister is so keen on wind, why have we not had answers to those questions? Why do we not have any discussion along these lines? I asked:
(a) What share of the renewable energy market does the Government consider will be captured by Australia’s renewable energy industry in: (i) 2010, (ii) 2015, and (iii) 2020; (b) what would this mean in terms of investment and export income and jobs in Australia; and (c) if no projection has been made, why not.
It is my understanding that no projection has been made. Maybe I should not have even bothered asking that question because it is very unlikely that the minister is at all interested in the wind power sector. He is much more interested, apparently, in taking Australia down the nuclear path. I asked:
What is the current estimate of greenhouse emission abatement and/or avoidance for each of the following Federal Government programs and by when will this be achieved:
(a) $14 million Wind Energy Forecasting Capability;
(b) $20 million Advanced Electricity Storage Technologies Program; and
(c) $100 million Renewable Energy Development Initiative.
These are all reasonable questions. We get the usual diatribe from this minister but we never get any details on how the government programs are going that are supposed to be taking Australia in the right direction with regard to greenhouse and renewable energy. No, we do not hear anything of that sort, which is why we have to put questions like this on notice. The fact that it has taken eight weeks and still there is no sign of an answer to any of those questions suggests to me that this minister has no interest in the subject. The fact that he was not even here, knowing that I was going to ask this question, that he did not even bother to turn up, suggests there is an arrogant disregard for the parliament and its right to know when government money is being expended, what it is being expended on and how successful that is.
I think the government’s performance on this issue is really disappointing. Taking Australia down a path of a debate about nuclear energy is a diversion from all of those questions that I have asked and more that I have not read out. It is avoiding those critical debates about how Australia reaches a situation where it can reduce its greenhouse emissions by 60 per cent. The minister says this is necessary, the Prime Minister says it is necessary and even the Minister for Industry, Tourism and Resources now says that it is necessary. That is a really good step in the right direction. But, so far, all this government has done with that information, with that acknowledgment, is say, ‘Let us have a debate about nuclear.’
Let us go back to those questions of how we achieve this aim. It is not just a question of coal or nuclear; there is a range of other issues that need to be taken into account and a lot of other sources of energy supply that should be considered. My questions go to the core of this issue. I urge the minister not only to get those answers back to my office as soon as he can but also to answer them with some honesty, which we have not seen much of in this place, and as if they are serious questions—because they are; they are about the future of this country. I ask that they be treated with some seriousness because this minister is supposed to be about looking after the environment and heritage, and the environment is very much tied up with the amount of greenhouse emissions this country emits.
I was informed by my staff shortly after question time that someone from Senator Allison’s office did contact my office during question time—before question time.
Mr Deputy President, I rise on a point of order. The minister is misleading the Senate. It was more than an hour ago—probably more like two to 2½ hours ago—that my office rang his office.
There is no point of order.
The point of order is that the minister is misleading this house, and I wish to make that point.
There is no point of order.
I suggest that the senator is being quite churlish here. I was informed immediately after question time, as I walked back to my office, by one of my staff members that my office had been contacted. I thought it was during question time, but I then corrected myself and said ‘before question time’. We were contacted before question time by a staff member from Senator Allison’s office who said, as is the normal courtesy, that a question was overdue and that it would be raised. That staff member was given an explanation that the question was long and complex. I think if you had the patience to listen to Senator Allison’s immediate contribution you would understand that it was a long and complex question about one of the most important policies before this government—and that is our response to the greenhouse challenge that this country is faced with. We have around $2 billion worth of programs—probably dozens of programs, not to exaggerate—all aimed at addressing the challenge of providing a reliable energy supply to Australia and the world and to do so with significant reductions to greenhouse gases.
So we informed Senator Allison’s staff that we had received from the department the draft response but that it had only been received in my office some 10 days after the date for tabling. All of this information was given to Senator Allison’s staff. It may be that Senator Allison’s staff did not pass the message on to her. But it was very carefully relayed to Senator Allison’s staff that my office had just received those draft responses and that we obviously wanted to give them the sort of diligence that Senator Allison has called for here. All of that was explained to her office, and my staff thought that that was the end of the matter. They thought that we had given a legitimate, sensible and honest explanation and that that would be the end of the matter. As soon as I knew that Senator Allison was on her feet I returned to the chamber. So I think to make an allegation that I have some sort of contempt or arrogance not to address this issue in the parliament is very churlish, unfair and unjustified.
The accusation that we do not take this subject seriously really flies in the face of the facts. Under the leadership of John Howard and the initial leadership of former environment minister Robert Hill, this government has put in place a range of programs over the past decade that are unrivalled in most parts of the world. The government has put in place a comprehensive program to address how you supply energy and transportation to Australia and to the world in a way that brings down our greenhouse gas signature. I will make a couple of points that need to be made repeatedly in this debate. Firstly, Australia has been incredibly successful in meeting this challenge. We will by about 2011, depending on Australia’s economic growth over the next couple of years, have doubled the size of the Australian economy from its size in 1990, which is the year the UNFCCC, the United Nations Framework Convention on Climate Change, has chosen to make a benchmark year for emissions. So the Kyoto targets that around 35 per cent of the world, including Australia, have set for themselves use 1990 as a base year.
In that period of time, Mr Deputy President—and a Queenslander would understand this better than most people, and certainly more than a Victorian Democrat senator—Australia’s economy has roughly doubled, and Queensland and Western Australia have led that phenomenal growth which has underpinned so much of the living standard security that people have enjoyed during the nineties and this decade. We have doubled the size of the economy, yet we are on track to achieve a greenhouse signature that is only eight per cent above our 1990 level. Image that: we have doubled the size of the cake economically, doubled the size of industrial production, doubled the output from the economy and massively improved the number of jobs but increased our greenhouse signature by but eight per cent. Is that any sort of signal that we should be complacent? Of course it is not. What we do know is that in the next 10, 20 or 30 years, with good economic management, a good industrial sector, a good productive sector and all of the people of Australia working as hard as they do, we would like to see the economy expand again.
The International Energy Agency predicts that the use of energy in the world will roughly double by 2030, and we know that Australia will probably see a similar sort of expansion in its energy requirements. We also know, as Senator Allison has said, that the Australian government is making a magnificent contribution to the science that is building—a contribution that all Australians and all of the Australian science sector should be proud of. We are committing in excess of $30 million to building that science—to understanding the impacts of human induced climate change, what carbon and methane do when they accumulate in the atmosphere at the sorts of levels that we have seen over the last 100 or so years, what will happen if they keep accumulating at the rate they are accumulating at, what the impacts will be on the climate and what the impacts will be on Australia. We know from all of that science, to which Australian scientists make an extraordinary contribution, kicking way above their weight as a country and scientific community, that we will need to reduce greenhouse gas emissions by around 50 to 60 per cent by 2060.
Senator Allison’s question goes to these vital issues. She asks that we respond in detail. Of course, that is exactly what my office will do. But she challenged me in her contribution to answer the question and she said that the government was not serious about renewables. We have hundreds and hundreds of millions of taxpayers’ dollars going into direct investment in research and development of renewables, on wind, on solar, and on solar thermal. I recently opened for the CSIRO their solar centre in Newcastle. This is world-leading technology and development on solar thermal which could see a hybrid technology between solar thermal and gas, increasing the energy coefficient of the gas by around 30 per cent and therefore creating the sort of breakthrough the world needs to store renewable energy—one of the problems that the world needs to get to the nub of—by storing it in an existing fossil fuel. It is what I would call a hybrid technology. The government is pursuing world-leading energy efficiency measures. The energy efficiency legislation that passed through this parliament mandating efficiency measures for major companies and major emitters is world-leading legislation, and we have a range of other efficiency measures.
The questions that Senator Allison asks me to provide answers to her office on will in fact cover this, but we will make the point, when we answer the question with the detail and diligence and the honesty that she should expect from the government and from me on these issues, that the solution to the dual policy dilemma of stabilising and reducing greenhouse gas emissions and of providing reliable energy to Australians so that we can have job security is a multitrack and multifaceted approach. We also need to supply energy to the world so that those in developing countries who do not enjoy our living standards can at least aspire to them, and that too will be part of that multitrack, multifaceted approach.
People on the Left—and the Democrats I think could be accused of this—will tell you that you can do it all without addressing the coal issue; that you can get rid of coal, move away from fossil fuels and just go for renewables and energy efficiency. That is a very dangerous proposition because it is false and it will lead people down the wrong path. It cannot be done. All of the expert advice around the world coalesces around the fact that you need to use all of the available technologies, invest in all of them, and bring them all on as quickly as possible if you are to reach that dual goal: energy reliability and security and lower greenhouse gas emissions. I may seek to incorporate this graph in Hansard, if Hansard has got full colour, because I think that this one stabilisation triangle graph from Princeton University tells the picture better than any thousand words I can ever put down. It shows on the left-hand axis where you have got rising levels of—
We do not think, from the picture you have shown us, that it will be able to be incorporated or in a way that will do justice to it.
I might just table it for the edification of senators from all parties. As I said, people on the Left try to tell you that you can just do it with renewable energy and energy efficiency. People on the Right will say that you can do it with nuclear power. I put to the Senate that both of them are equally wrong. There is no silver bullet in nuclear power and there is equally no silver bullet in renewable energy or energy efficiency. The reality is that we need to invest and bring on technologies in all of these areas, in renewable energies and fuels. The Australian government are investing enormously in solar and in wind turbines, with $3 billion worth of cross-subsidies to wind energy. We approved one last week and another one today. We will build around 600 turbines under the existing program. Before 1996 there were 20; there will be 600 by the end of the current program, and we are investing more. We believe that we need to continue to build wind energy, so we are doing a wind-forecasting program to predict where wind turbines should be located so that they create the best efficiency and the best outcome. I will be taking to my ministerial counterparts at the Environment Protection and Heritage Ministers Council in Sydney on Friday week a proposal for a national wind farm code so that we can get a sensible planning approach to wind farming.
We know that we need to do carbon capture and storage. I welcome the Victorian and Queensland Labor governments coming on board and supporting the federal coalition’s Low Emissions Technology Demonstration Fund, with $500 million being matched by the Queensland government and the Victorian government with lesser amounts and by the coal industry with $300 million, to see if we can get that breakthrough in capturing the carbon at the top of the smokestacks of coal-burning power stations and geosequestering it or in finding ways to make coal burn more cleanly.
We know that that is one of the technologies that you have to have. If you set that aside and say that you should not put money into cleaning up coal, you know that the problem cannot be solved. I refer to an eminent person on this issue, arguably one of the best informed in the world, and that is Eileen Claussen, the head of the Pugh Center’s climate change project which Australia participated in through Howard Bamsey and the dialogue at Pocantico, a two-year dialogue. She and a group of people from all around the world including Howard Bamsey, the head of the Australian Greenhouse Office, participated in this two-year project. Eileen Claussen, who was President Clinton’s climate change negotiator, said to me at a breakfast at the Montreal climate change function that she hosted that one of the immutable truths that she got out of the project was that if we do not get a breakthrough in carbon capture and storage of fossil fuels we will not solve the problem. She was not saying: don’t do all the other stuff. More than anyone else she would say that you have got to do all the other stuff. She would totally agree with this approach. But she said that one of the absolute do-or-die things for the planet is carbon capture and storage. So a member of the Clinton White House, a very well-informed person, says that you have got to do this. To those people from the Left or the Right who say it is wacky and you cannot do it and you cannot sequester carbon, firstly, I say: go to Norway and see where they have done it in Sleipner in huge quantities. Secondly, I say: go and look at the Gorgon proposal on the North-West Shelf where they intend the biggest sequestration ever anywhere in the world.
We also need a breakthrough in the efficiency of our vehicles. We need fuel efficiency, we need emissions efficiency and we need to transform our transport fleet in Australia and around the world, massively. We need fuel switching. We need to find a way to encourage people to move more to gas. The Queensland government has once again taken a lead in that area by creating a policy to move to gas. By switching to gas, you get a nearly 50 per cent reduction in greenhouse gases. We also need to globally—and this will be in the answer that Senator Allison is chasing—transform our landscape. We in Australia are leading in this area. We need to stop deforestation and to plant more trees not only for commercial reasons but also for environmental reasons.
As you would know, Mr Deputy President, we have revegetated something like 2.1 million hectares, we have invested $4 billion through our natural resource management programs, and Australia has a marvellous story to tell in relation to stopping deforestation and seeing more forests planted. Further, we need to transform our agricultural sector. We need to do all of these things. We need to move to low tillage to stop nitrogen and methane being released into the atmosphere. Senator Allison is absolutely correct about this: it is an incredibly serious issue.
We have got to get the economics of this right and we have got to get the environmental consequences of it right. That is why the Prime Minister has said that the security of the world’s energy supplies, Australia’s role in energy supplies and the greenhouse side of the equation are so serious and so important that you cannot leave one of these seven segments out of the equation. Anyone on the Left who says you have got to leave nuclear out of the equation is creating the same problem as anyone on the Right who says that renewables should be left out. They are both as bad as each other. You have to do nuclear as well. Imagine a world where we said no to nuclear. You would see France closing down 75 per cent of its power and reverting to coal or gas. That would be brilliant! Well done, Democrats—great idea! You would see the United States closing down the 20 per cent of its power that is coming from nuclear—as Senator John McCain told me on 2 January. How stupid it would be to say no to nuclear, which the Democrats would have you do, and to see the United States importing more coal, gas or oil to burn. It is the sort of idiocy that you expect from the Australian Democrats.
If this problem is going to be solved, you need to work in each one of these seven areas. You need to invest heavily in them, and the great thing about the Australian government—and all Australians should be proud of this—is that we are investing in renewables. We are investing in solar and we are investing in wind. We are investing in energy efficiency and we are investing in carbon capture and storage. We are putting massive investments into alternative energies and alternatives fuels, and we are putting massive investments into the biofuels industry, fuel switching, forests and soils. And now, because of the leadership of the Prime Minister, we are not shying from a debate that we have shied away from for too long, and that is: how do we use our uranium resources to help solve this global challenge of reliable energy, a clean future and a low greenhouse future?
I look forward to delivering to Senator Allison a comprehensive answer, diligently and honestly prepared, to all of those questions. I apologise for my office not advising me that she would get to her feet and raise this issue here today. There was clearly a breakdown in communications. My office thought that we had, through one phone call, given Senator Allison’s office a sensible and reasonable response to the query and that it would be entirely unnecessary for her to stand up here. But I do undertake to get that answer to her as quickly as I possibly can.
Question agreed to.
I move:
That the Senate take note of answers given by the Minister for Immigration and Multicultural Affairs (Senator Vanstone) to questions without notice asked by opposition senators today relating to skills shortages and to detention practices.
What we heard today at question time really misses the point of the debate. The minister had the opportunity to bring all her colleagues to heel, but what we have found is that the government is still very much divided on this issue. And no wonder, when you look at the issues that were brought before the committee that looked into the Migration Amendment (Designated Unauthorised Arrivals) Bill 2006. What a name. Most submissions and witnesses before the Senate Legal and Constitutional Legislation Committee put to the committee that the bill represents a flawed domestic policy in a number of key areas, it breaches Australia’s obligations under international law, particularly under the refugee convention of 1951, and it represents deficient foreign policy in terms of a perceived attempt to appease Indonesia over situations in West Papua.
Perhaps it is worth while explaining briefly what the bill does. This bill provides what this government brought in in 2001, which was the Pacific solution. It will mean that the offshore processing regime will apply to all persons arriving on mainland Australia unlawfully by sea. It does not try to differentiate as to whether those persons arrive by canoe, cargo ship or cruise liner. But I suspect the minister will sort that out, using her own discretion.
Therein lies one of the problems. The bill will also cover certain air arrivals, where a person travels most of the way to Australia by sea but travels the last leg by air. So we have got this enormous piece of legislation which will change the way these things are dealt with. We have a government report which unanimously recommends that this bill not proceed because of the matters that I have already mentioned. It is wrong. The report states:
… the Bill is an inappropriate response to what is essentially a foreign policy issue.
What this report shows is what Australians had already recognised—that is, you cannot fix this piece of legislation. There are no amendments that can be moved that will affect the law of Papua New Guinea, where people are dumped on Manus Island. The legislation is about pretending Australia has no border and dumping people in other countries. There is no way of amending Australian law to prevent that from being anything other than offensive, anything other than throwing away every single human right obligation that Australia considers part of the concept of a fair go.
We already knew Mr John Howard was willing to listen to Indonesian politicians. We now get to find out whether he is willing to listen to Australian politicians. Without exception, the Australian politicians who have been looking closely at the evidence have said that there is no way to fix this piece of legislation and the only way to fix it is in fact to vote no. It is unamendable. The majority government report went on to try to ameliorate its effects. It is irredeemable, and they know it. That is why they said at the outset that it should not be proceeded with. No matter what form the legislation ends up in, you cannot take away its effect. That involves dumping people in other countries and pretending that Australia has no borders.
There are no amendments that will cause us to end up supporting this bill. Labor will be voting against this bill. It is wrong on every count, on every point. The government knows that but they are going to persist with it. More importantly, the government backbenchers know that, and we will be interested to see how they feel about it. We have already heard today that there has been a bit of minor revolt over there—a bit of minor scurrying about—but guess what? I think that at the end of the day they will lock in, because they like their comfy zone over there and they are not prepared to take it up to Senator Vanstone and tell her that the legislation is wrong, that she should desist and that she should realise that it is a wrong piece— (Time expired)
The bill that is currently being considered is, it has to be pointed out, quite a lengthy one and is still under consideration. The committee has suggested that its work was supposedly significantly hampered by the absence or limited availability of critical information and also by the provision of documentation that it says provided only a minimalist framework for the proposed system. I understand that the department in fact provided a lot of detailed information in relation to the current arrangements regarding both Nauru and Papua New Guinea. This covered details of such things as accommodation, health care, education, arrangements for processing asylum claims, access to legal assistance and opportunities for monitoring by the Commonwealth Ombudsman. Let us not forget that the Department of Immigration and Multicultural Affairs has foreshadowed that a number of reviews are also being undertaken in relation to practical arrangements for offshore processing, such as community accommodation arrangements for women, children and families.
What I would like to do in the limited time I have available to me is to just focus a little bit on what this new legislation will actually mean. What it means practically is that people who arrive, unauthorised, by sea will no longer be able to make a protection visa application by reaching the mainland rather than an excised place. People who arrive in Australia by sea and seek asylum will be processed offshore. People found to be refugees will remain offshore while resettlement is arranged. As under the existing provisions, the minister will have a personal, non-compellable power to allow a person to make a valid visa application in Australia.
Australia will continue to meet its international obligations as far as refugee processing goes. Australia has a very, very good record in relation to its intake of refugees and its processing in this area. Any claims to refugee status will be properly assessed at an offshore location in accordance with the provisions of the refugee convention. As I said, Australia will continue to meet its international obligations in relation to refugee processing.
I remind the Senate that the refugee convention does not set down any particular process for signatory countries to decide who are refugees. This is a matter for each country to determine. Australia will ensure that reliable refugee assessment processes are in place. The Australian government and the Department of Immigration and Multicultural Affairs have taken several opportunities to brief the United Nations High Commissioner for Refugees on the operation of the proposed new arrangements, and I am sure that the department will continue to do so as the new arrangements are further articulated.
I want to take the opportunity to make some general comments in relation to what is a constant attack on the Department of Immigration and Multicultural Affairs that we see in this chamber. I think we need to look at the department in a wider context. This is a department that makes in excess of four million decisions a year. It administers a large and complex migration and refugee program. In terms of statistics, in addition to the 43 per cent of Australians who either are born overseas or have at least one parent born overseas, Australia is host to a large number of temporary entrants. In December 2005, for example, there were around three-quarters of a million people in this country on a temporary basis. Just to illustrate my point in relation to the department that makes four million decisions a year, in the five minutes or so that I am speaking today, the department has considered and granted around 45 visas and around 225 people have entered and left our country, which is almost one a second. (Time expired)
I rise to take note of answers given by Senator Vanstone in question time today. I asked a number of questions of Minister Vanstone in relation to the Senate Legal and Constitutional Legislation Committee report that was tabled in the Senate yesterday on the Migration Amendment (Designated Unauthorised Arrivals) Bill 2006. As has been said in the chamber here this afternoon on a number of occasions, the Senate committee of which I am a member recommended that the bill should not proceed. The committee report has endorsed what Australians worked out long ago, that this bill is fundamentally wrong and should not become law. Let me explain why. There are a number of reasons but I only have a short period of time in which to speak so I will try to identify some of the key problems with the bill. As we know, the result of the reforms that were enacted last year by way of the Migration Amendment (Detention Arrangements) Bill 2005 means that, not before time, Australia now has a somewhat softer edge on mandatory detention. As we know, that bill resulted in children not being held on the mainland in detention centres.
The effect of this bill before the Senate now is that all of the changes that were made last year mean nothing. What the bill will do, as well as not ensuring that children will be kept out of detention, is remove reasonable time periods of detainment and improvements in the provision of mental care. One of the questions that I addressed to Senator Vanstone today was in relation to the Commonwealth Ombudsman’s jurisdiction over persons held in detention. The minister said today that her understanding was that the Commonwealth Ombudsman would still have jurisdiction in relation to persons being held in Nauru. This is in fact what the department said to the committee. They confirmed that the Ombudsman’s jurisdiction does extend to processing on Nauru. But when we questioned them further it was made quite clear that this would still be contingent on the government of Nauru granting a visa to the Ombudsman to travel to Nauru. As we heard in the evidence before us, it is a very rare occurrence for the Nauruan government to grant a visa to persons wishing to visit there to observe and investigate what is happening to people in detention.
This is not something which is within the control of the Australian government. If the Nauruan government determines that the Ombudsman is not to be granted a visa, then he—as is the present case—will not be able to go to Nauru and investigate. It is also quite clear, and this came out in the evidence, that the requirement in part 8C of the Migration Act that the Commonwealth Ombudsman provide reports on persons held in detention for more than two years will not apply in relation to persons held in offshore processing locations. So the improvement put into place last year in relation to detainees held in Australian detention centres, namely that the Ombudsman will be required to investigate the reasons for their detention if they have been held for a period greater than two years, simply will not occur on Nauru. This is one of the many problems that exist in this bill. As Senator Ludwig said, it is for this reason that the committee reported unanimously that the bill should not proceed. It is for this reason that Labor will be voting against this bill when it comes before the Senate.
This bill can hardly be said to be for border protection. In fact, if it is passed Australia will effectively have no border in relation to those persons coming here by boat seeking asylum. All of those people who are seeking asylum in this country who reach the mainland by boat will be taken away and put into mandatory detention on Nauru. The primary reason, as I have indicated, that this is totally unacceptable is that the processes that occur on Nauru are not subject to independent review. I have mentioned the Ombudsman, but also any decisions that are made are not subject to independent review. The RRT does not have jurisdiction in relation to decisions made. Any decisions that are made will simply be reviewed by another departmental officer. (Time expired)
I also rise to take note of the answers of Minister Vanstone. I will commence by commenting on some of the remarks of Senator Kirk a moment ago. There is a lot of presupposition that people who arrive illegally and are processed offshore are not going to be catered for. That is just not true. This is a government that will not stand by and allow people not to be cared and catered for in a humane and dignified way. I think that needs to be clearly stated and placed on the record. We are talking about border security as well as the matters of the report handed down by the Senate Legal and Constitutional Legislation Committee yesterday. We must understand that intelligence has been presented to this government that there are more people staging a process to move to Australia. We have to protect our borders in every possible way we can and also the lives of those who want to endanger themselves in coming to this country by means regarded as very substandard. I think it is very responsible of this government to create a deterrent effect to prevent people embarking on the most dangerous of voyages that they possibly could, endangering the lives of women and children, not to mention the male adults that would accompany them.
As indicated earlier today, the Senate committee report handed down yesterday is very comprehensive. It was only released yesterday, and I think it takes some time for anyone, let alone a government, to consider all the points in detail. This is a government that does that. It considers many things in detail. It examines each and every point in the report and will, where necessary, respond. I think that is the most responsible attitude that any government or any administration can take.
I also think it is important to note that the department itself has undergone tremendous transformation under the guidance of Mr Andrew Metcalfe. This department is one that has grown, developed, improved and responded to ever-changing scenery, an ever-changing feast of activities and an ever-changing host of problems that are presented to it. I think it is commendable that we have a department in a reformation process and constantly adjusting, as many departments need to do.
I think we need to be cognisant of some of the aspects of the report that were handed down yesterday, and my colleague Senator Fierravanti-Wells has indicated some of these. It is important to emphasise that the committee has suggested that its work was significantly hampered by the absence or limited availability of critical information and by documentation that provided only a minimalist framework for the proposed system. With that background, we need to understand that this report is not overly comprehensive in some areas. This report goes some way to guide the government, but it is not a complete document in itself; it is for guidance. Also, we need to understand that the report covered details of accommodation, health care and education arrangements for processing asylum claims, together with access to legal assistance and opportunities for monitoring by the Commonwealth Ombudsman.
Opposition senators interjecting—
I note that senators opposite indicate that the Commonwealth Ombudsman may have fettered access. The Ombudsman will have access to asylum seekers as and when necessary and this government will support that process.
There is no guarantee of that.
I hear interjections from the other side about no guarantee. This government will stand by the need to ensure that there is that independent Ombudsman capability, and we will facilitate that in any way we possibly can. It is important to point out, certainly in relation to the alleged lack of information provided by the department, that the majority report states at page 59:
3.197 Despite the volume of evidence received, the committee has been significantly hampered by the absence or limited availability of critical information to assist with its deliberations in this inquiry. This is primarily due to the Bill and associated documentation providing only a minimalist framework for the proposed system. As a result, the committee has been forced to rely on information provided by the Department since the Bill was referred for inquiry to ‘fill in the gaps’.
It clearly states ‘to rely on information provided by the department’. The department is a complex and multidisciplined department that is dealing with a myriad of issues. (Time expired)
I rise to take note of the answers from Senator Vanstone today. In particular I want to note and highlight the lack of commitment from this minister to actually take this report seriously, and I want to pick up on a couple of comments I have heard in the last half an hour. We had two days of hearings into this bill. I note with interest that the government did not wheel out any of its members of the committee to actually stand before us in taking note to defend or to provide comment on their own report today—an interesting fact.
There were a number of problems in terms of information provided to the committee during the hearing, particularly on Tuesday last week in Sydney, where the department was not able to provide answers and in fact failed to even send anybody—if I remember correctly—to the proceedings in the morning. There was actually no-one from the department sitting in the public hearing for the first four hours taking notes to enable any senators to refer to the department for clarification of what was being said. I do not think I have sat in very many Senate committees in my time in this parliament where someone from the department has not at least been at the back of the room watching and listening to what was being said. The absence was particularly notable given the department was due to appear at 1 o’clock that afternoon.
Senator Parry, you are right: the lack of detail about this bill is because your government has not worked it out. The department was not able to provide us with this information and this detail. Of 136 submissions received, one wanted the bill supported—and that was your department. The 136 submissions included a large representation from churches and from the Refugee Council of Australia, which represents over 80 organisations defending the rights of refugees. Large organisations such as those can see nothing in this bill that warrants any of it being supported. In fact, as we left the committee hearing last week, I thought, ‘It will be a surprise to me if the government members can find anything in the two days of hearings that will lead them to want to support this bill being passed.’ I was not surprised when I got the chair’s draft to find that the major recommendation of this report was that the bill should not proceed. I want to commend the chair of this committee for actually coming up with that conclusion. Quite frankly, she had no other option but to do that.
It is disappointing today that we have not heard from the minister that the report is going to be taken seriously and that a response will be provided as soon as possible. In light of the massive criticism around this country and given that three of the minister’s own government members who signed up to this report do not want the bill to proceed, it is disappointing to hear from the minister that this bill is still going to proceed. There is an article in the Age today—more likely the editorial—headed ‘Human rights should not take a back seat to appeasement’. It points out that only in January this minister, Minister Vanstone, pledged that the department would not be swayed by foreign policy considerations in deciding refugee claims. But that is exactly what this bill is about.
This bill is about decisions of immigration policy being made independently of our relationship with Indonesia. But that is not what is happening here. Indonesia have got their fingers in the pie of our immigration policy now and will dictate to us, and this government has responded and changed the policy and will want to change the laws accordingly. That is clearly evident in the report and it was clear in the evidence that was given to the committee. This is a bill that excises Australia from the rest of the world and from our international obligations. There is no justification for it and there are no reasons for us to believe otherwise, given the evidence that we were provided with during the public hearings. The claims about the Ombudsman are absolutely and totally incorrect and were justified and backed up by the department. There will be access to the Ombudsman only to appeal decisions of Commonwealth officials. (Time expired)
Question agreed to.
I move:
That the Senate take note of the answer given by the Minister for Justice and Customs (Senator Ellison) to a question without notice asked by Senator Allison today relating to Guantanamo Bay.
I referred to Professor McCoy, who is a professor of history at the University of Wisconsin and has just written a book, A Question of Torture: CIA Interrogation from the Cold War to the War on Terror. Professor McCoy has a great deal of experience in looking at the CIA, having written previously about their complicity in the global drug trade.
The minister’s response was that Australia has raised this with the United States, that it is not the fault of the Australian government that David Hicks has been there for 4½ years and that this was an appeal that was lodged that has nothing to do with us. In our view, the Australian government should have been much more active in getting David Hicks released back to Australia—as other countries have got their citizens released back to them—or seen that the United States got on with the business of having him face whatever trumped-up charges he faces, so that he can be released. This book illustrates the danger of being detained in a place like Guantanamo. In an interview given to Lateline this week as a result of his article in Monthly magazine, Professor McCoy said:
Guantanamo is not a conventional military prison. It’s an ad hoc laboratory for the perfection of the CIA psychological torture. Guantanamo is a complete construction. It’s a system of total psychological torture, designed to break down every detainee contained therein, designed to produce a state of hopelessness and despair that leads, tragically, sadly in this case to suicide. The statements by those American officials are indicative of the cruel mentality at Guantanamo.
He said:
The standard techniques used on countless detainees—blasted with sound, blasted with light, confined in the dark, short shackled, long shackled. Now, all of the techniques that the FBI describe and literally dozens of emails from Guantanamo are basically describing the two foundational techniques that are key to the CIA psychological torture paradigm.
Professor McCoy said that FBI officers reported that people were short-shackled on the floor for days at a time:
One detainee so desperate that overnight he pulled his hair out, hair by hair. Others covered in faeces, their own waste. Many detainees suffering signs of psychological breakdown. Another thing the FBI established very clearly is that these techniques were of course counter-productive. The FBI would often start interviews and after one of their subjects was subjected, for example, to a regime of strobe lights or blasting rock music, that when the FBI tried to conduct their next interview, the detainees were suddenly hostile and non-cooperative.
… … …
They described detainees huddling, quivering, signs of extreme psychological stress. There is also the documented case of the famed detainee Rasul, who was subjected to these techniques of rock music, strobe lights, extreme isolation in a darkened cell for a period much less than David Hicks, by the way, and Rasul was so desperate to end this regime of treatment that shown a video of 40 Jihadists in Afghanistan seated beside Osama bin Laden, he falsely identified himself as one of the jihadists and it wasn’t until an agent of MI5 arrived from Guantanamo and established he had been a clerk in an electronics shop in the United Kingdom and not a jihadist in Afghanistan at the time he said he was that the US officers realised he’d given false information in order to end this harsh treatment.
That is the nature of torture, but our minister says we are doing as much as we possibly can, that we have sent in the consulate 16 times in 4½ years—that is fewer than four times a year, once a quarter. I do not know what they discovered when they visited David Hicks, but I think we can all guarantee, based on that advice from Professor McCoy, that he would not be in good spirits—I doubt anyone would be in good spirits even being held in a prison with perfect circumstances and facilities where people were not being tortured. It is hardly likely that he could be regarded as someone who was either well or in good spirits.
The answer given by the minister is not adequate. Australia needs to make urgent and determined representation to the United States government. We do not agree with torture. (Time expired)
Question agreed to.
Petitions have been lodged for presentation as follows:
On behalf of the Standing Committee on Regulations and Ordinances, I give notice that 15 sitting days after today Senator Watson shall move that the following legislative instruments, a list of which I shall hand to the Clerk, be disallowed.
The list read as follows—
I seek leave to incorporate in Hansard a short summary of the matters raised by the committee.
Leave granted.
The summary read as follows—
Airworthiness Directive Part 39-105—AD/750XL/6: Centre Console Wiring Loom
This Airworthiness Directive requires an inspection of the wiring loom and the installation of additional mechanical protection for the wiring and tie-wraps for the Pacific Aerospace 750XL Series Aeroplanes. The Directive was made on 9 December 2005 and became effective from that date. It is nevertheless numbered as 2/2006 TX. The Committee has written to the Minister seeking advice on the numbering of this instrument.
Civil Aviation Order 82.1 Amendment Order (No. 2) 2006
This Order permits flight crew competency checks to be carried out by overseas flight simulator training organisations. According to the Explanatory Statement, it has been the practice of the Civil Aviation Safety Authority to permit one of the two annual competency checks to be carried out by overseas trainers, the second check being carried out in Australia. The stated purpose of this Order is to put this administrative practice onto a more certain legal footing. It is not clear, however, whether it is intended by this Order that both of the annual competency checks may now be carried out by overseas trainers. The Committee has written to the Minister seeking advice on this matter.
Instrument No. CASA 49/06
This instrument revokes a previous instrument (CASA 579/05) dealing with the supervision requirements for aircraft polishers.
The Explanatory Statement to this present instrument states that the revocation is necessary because the scope of the previous instrument has been misinterpreted, leading to possible concerns for aircraft safety. The Committee has written to the Minister seeking advice about the nature of this misinterpretation and its effect on aircraft safety to assist in its consideration of any future instrument that might be made in substitution for the revoked instrument.
Senator Ferguson to move on the next day of sitting:
Senator Marshall to move on the next day of sitting:
Senator Watson to move on the next day of sitting:
Senator Johnston to move on the next day of sitting:
Senator Bartlett to move on the next day of sitting:
Senator Bob Brown to move on Tuesday, 20 June 2006:
Senator Siewert to move on the next day of sitting:
Senator Siewert to move on the next day of sitting:
Senator Bartlett to move on the next day of sitting:
Senator Nettle to move on the next day of sitting:
Senator Nettle to move on the next day of sitting:
I present the fifth report of 2006 of the Selection of Bills Committee.
Ordered that the report be adopted.
I would like to ask Senator Scullion if he could acquaint the Senate with the reasons for deferring consideration of the Protecting Children from Junk Food Advertising Bill 2006.
I am advised that the request for a delay came from the Democrats. I seek leave to have the report incorporated in Hansard.
Leave granted.
The report read as follows
SELECTION OF BILLS COMMITTEE
REPORT NO. 5 OF 2006
The committee recommends accordingly .
Bills deferred from meeting of 10 May 2006
Bills deferred from meeting of 13 June 2006
Jeannie Ferris
Chair
14 June 2006
Appendix 1
Proposal to refer a bill to a committee
Name of bill(s):
Petroleum Resource Rent Tax Assessment Amendment Bill 2006 and Petroleum Resource Rent Tax (Instalment Transfer Interest Charge Imposition) Bill 2006
Reasons for referral/principal issues for consideration
The primary concern in this Bill relates to Schedule 3 which amends the Petroleum Resource Rent Tax to allow the present value of expected future expenditures associated with closing down a particular petroleum project, where these future expenditures relate to so much of this project as continues to be used under an infrastructure licence, to be deductible against the PRRT receipts of this project.
It relates to ‘closing down’ costs when a project is terminated. Costs from this project are allowed to be offset against revenue until the project ends. Under this provision the Parliament has been asked to support a provision that allows proposed future expenditure of an unsuccessful project to be used as a deduction against PRRT as long as an infrastructure licence is held. However, the expenditure has not even been made, and the deduction is claimed now.
The definition of expected expenditure is loose and needs clarification, while Treasury and industry should also be asked to justify schedule 3 and indicate whether these are sufficient integrity safeguards to protect against tax avoidance.
This measure has been presented to the parliament before and has been subject to Senate review.
Possible submissions or evidence from:
Noel Mullen—Australian Petroleum Production and Exploration Association, ESSO Australia, Santos, Woodside, Apache, Shell, BHP, Chevron
Committee to which bill is referred:
Economics Legislation Committee
Possible hearing date: 19 June 2006, 22 June 2006
Possible reporting date(s): 22 June 2006
Appendix 2
Proposal to refer a bill to a committee
Name of bill(s):
Tax Laws Amendment (2006 Measures No. 3) Bill 2006
Reasons for referral/principal issues for consideration
A Committee is needed to review the proposed operation of the Unlawful Termination Assistance Scheme and the Alternative Dispute Resolution Assistance Scheme and relevant tax treatment.
The costings of schedule 9 need clarification.
A review of changes included in schedule 11 and 12 is needed. They are not insignificant and charities should be given the opportunity to be fully consulted.
Schedule 15 is a controversial measure with a highly retrospective element. The Senate should consider the impact of the measure on investors.
Possible submissions or evidence from:
HIA, Real Estate Institute of Australia, state governments, Treasury, Salvation Army, Mission Australia, DEWR
Committee to which bill is referred:
Economics Legislation Committee
Possible hearing date: 20 June 2006
Possible reporting date(s): 22 June 2006
by leave—I move:
That leave of absence be granted to Senator Ronaldson on 13 June 2006 on account of family matters and to Senator Santoro for the period 13 June to 16 June 2006, on account of parliamentary business overseas.
Question agreed to.
The following items of business were postponed:
Business of the Senate notice of motion no. 3 standing in the name of Senator Milne for today, proposing the reference of a matter to the Environment, Communications, Information Technology and the Arts References Committee, postponed till 20 June 2006.
General business notice of motion no. 415 standing in the names of Senator Stott Despoja and Bartlett for today, proposing the introduction of the Same-Sex Marriages Bill 2006, postponed till 15 June 2006.
by leave—I move the motion as amended:
That the Senate—
Question put.
I move:
Question put.
I move:
Question put.
by leave—I move the motion as amended:
That the Senate—
Question agreed to.
I move:
Question agreed to.
At the request of Senator Humphries, I move:
Question agreed to.
On behalf of the Parliamentary Standing Committee on Public Works, I present the ninth report of 2006 entitled HMAS Cairns Redevelopment, Cairns, Queensland and the 10th report of 2006 entitled Construction of Housing for Defence at Fairview Rise, Ipswich, Queensland, and move:
That the Senate take note of the reports.
I seek leave to incorporate my tabling statement in Hansard.
Leave granted.
The statement read as follows—
HMAS Cairns Redevelopment, Cairns, Queensland;
The ninth report of 2006 addresses the redevelopment of HMAS Cairns for the Department of Defence, at an estimated cost of $76.3 million.
Defence submitted that the purpose of the proposed works is to provide facilities at HMAS Cairns for the berthing and effective operation of the new ARMIDALE Class Patrol Boats; and to refurbish and reinvest in ageing base infrastructure. This will be achieved by the acquisition of increased berthing access at the adjacent commercial wharf; and the refurbishment of existing shore facilities at HMAS Cairns.
One of the issues raised in submissions to the inquiry was regarding proposed property acquisition by Defence. At the public hearing the Committee heard evidence from representatives of Defence, the Cairns Navy League and the Training Ship Endeavour on this matter. After questioning witnesses, it became clear to the Committee that there were still unresolved issues and further consultation and negotiation had to be undertaken by Defence. At the hearing Defence reaffirmed its commitment to the Training Ship Endeavour and to working with all stakeholders to resolve the property acquisition issue in the best interest of the cadets. As a result the Committee recommends that the Department of Defence keep it informed of progress and the outcome of negotiations in respect to the acquisition by Defence of the Training Ship Endeavour land and facilities.
Defence submitted that an Environmental Impact Assessment undertaken at HMAS Cairns had identified certain requirements for the construction work that would be incorporated into the project’s Construction and Environmental Management Plan (CEMP). Defence added that in addition to the project-specific CEMP, HMAS Cairns already has a Base Environmental Management Plan which is currently under review. The Committee recommends that the Department of Defence supply it with an updated copy of the HMAS Cairns Base Environmental Management Plan which has will be amended to include the new works.
Having given detailed consideration to the proposal, the Committee recommends that the proposed HMAS Cairns Redevelopment proceed at the estimated cost of $76.3 million.
Construction of Housing for Defence at Fairview Rise, Ipswich, Queensland
The Committee’s tenth report of 2006 presents findings in relation to the proposed construction of housing for Defence at Fairview Rise, Ipswich, Queensland, with the Defence Housing Authority as the proponent agency for the work.
The purpose of the proposed work is to provide modern community standard housing to meet the operational needs of the Australian Defence Force and the requirements of Defence in south-east Queensland, particularly for Australian Defence Force members located at RAAF Base Amberley.
The long term Defence planning for RAAF Base Amberley has contributed to the increase in the Australian Defence Force housing requirement forecast for the Ipswich area. The site of Fairview Rise is located close to community facilities, shops and schools, and is approximately six kilometres from Ipswich and eight kilometres from RAAF Base Amberley.
All proposed 162 DHA residences will be four-bedroom detached housing with ensuite, family room, double garage and at least 18 square metres of covered outdoor living area.
The Committee inspected the site of the proposed development and conducted a public hearing in Ipswich on 16 May 2006. Issues explored at the hearing included house design, project delivery, traffic considerations, consultation and a range of environmental issues.
At the public hearing, the Committee sought assurance from DHA that adequate water, electricity, gas and telecommunications connectivity would be provided to the site. Whilst DHA were able to confirm the provision of these sites services, however could not at the time confirm broadband internet facilitation for the site. Given the growing demand and importance of this service, the Committee recommends that DHA advise it on the provision of broadband connectivity within the Fairview Rise estate.
DHA stated in its statement of evidence that an extended bus route could be introduced to the site bringing the majority of residents to within 400 metres of the nearest bus stop. After further questioning DHA confirmed that the main arteries are sufficient to accommodate a bus route, however are still in discussion with the Ipswich City Council for an extended bus route. In this regard the Committee recommends that DHA advise it on the provision of an extended bus route for the site.
Question agreed to.
On behalf of the Chair of the Senate Standing Committee for the Scrutiny of Bills, Senator Ray, I present the report and the Alert Digest.
Ordered that the report be printed.
In accordance with the provisions of the Auditor-General Act 1997, I present the following report of the Auditor-General: Report No. 46 of 2005-06 entitled Performance Audit—Commonwealth State Housing Agreement follow-up audit: Department of Families, Community Services and Indigenous Affairs.
I move:
That the Senate take note of the report.
I wish to take note of this report, because I think it is a subject which is of critical importance to the wellbeing of most of Australia’s vulnerable citizens. Sadly, I think there are few areas of public policy which have suffered more under the 10 years of the Howard government than their neglect of housing and urban development. Public housing, funded under the Commonwealth-State Housing Agreement, has borne the brunt of this neglect.
This report that we have here today highlights the need in the opinion of the ANAO to improve the level of accountability and transparency of the reporting for the Commonwealth-State Housing Agreement performance against agreed outcomes. Despite the fact that we have had Commonwealth-state agreements since 1945, a proposition is being advanced by this government that, essentially, questions of housing are matters of state responsibility and, if they are not matters of state responsibility, they are matters for the market. Despite the fact that we have had a Commonwealth-state agreement on housing for 61 years, this government claims that it knows nothing about it and that it has no responsibility for it. There is no minister for housing, no housing programs to speak of and no sense of the government’s responsibility to ensure that there is adequate equality of opportunity for all Australians. Particularly with regard to public housing, which is funded under the Commonwealth-State Housing Agreement, we see that this government has overseen a savage record of neglect.
The ANAO report talks a lot about risks and risk management. It notes that FaCSIA did undertake a risk assessment in response to its previous report in 1999-2000. It also notes that the current department that assumes responsibility for housing matters consulted only one stakeholder in its response. In other words, of the eight states and territories, only one was consulted. This is despite the vastly different issues and pressures that are faced by the states and territories with regard to the question of housing. I strongly endorse the ANAO’s suggestion that the department undertake a comprehensive risk assessment and that it broaden its consultation during the risk assessment process to encompass the full range of state and non-government stakeholders.
The Australian National Audit Office suggests that the risk assessment take place as part of the development of future agreements. But, at the moment, the greatest risk of all to social housing in this country is whether or not there will be future agreements. There is widespread concern amongst the stakeholders, be they state or territory governments, non-government organisations or providers of different types. Great concern has been put directly to me that there are constant rumours that the Howard government intends to walk away from public housing altogether when the current Commonwealth-State Housing Agreement expires. So this may be the last Commonwealth-State Housing Agreement if the government has its way.
Those fears are based on a rational assessment of the government’s performance to date. They are rational assessments based on what the government has actually done. Under the existing Commonwealth-State Housing Agreement, over the last 10 years real dollar support has declined by 30 per cent. There has been a 30 per cent cut in the level of funding support for public housing by this government. That is particularly shocking when we understand that secure, affordable housing is square one when we are talking about the opportunity for all Australians to get a fair go in this country. Having a decent place to live is the building block for almost everything else in life, whether it be finding a job, accessing education and training, or maintaining your health, social connections, friends and family. It is square one in terms of your social wellbeing.
Few areas of government policy hold a clearer mirror to a government’s values than its attitude to housing. The Howard government attitude is that the market is king with regard to the interests of housing, and provision of the housing needs of our most vulnerable citizens is, at best, perfunctory. Poor services for poor people are what this government can be characterised as standing for. It does not see that it actually has any obligations in this regard. Its reduction in funding to the Commonwealth-State Housing Agreement by almost a third has left the state housing authorities basically broke. Around Australia, it is the same story.
One particular example which I think is characteristic of the current situation is that of South Australia. In South Australia, the state authority receives $67 million a year in Commonwealth funding under the Commonwealth-State Housing Agreement. The CSHA has to repay $65 million per year for debt on loan repayments. So, in effect, the net Commonwealth contribution to South Australia for public housing is $2 million a year. That is the situation. The average age of existing housing stock in South Australia is 44 years. Fifty-four per cent of that stock has at least three bedrooms. All but 67 per cent of new applicants, however, are single people. So there is very old, obsolete stock being put in place and quite significant changes in the way in which people are seeking to use that stock. This is at a time when the Commonwealth has reduced its contribution to the provision of new stock by 30 per cent.
As a consequence of that policy, over the last 10 years the number of dwelling units available under the Commonwealth-State Housing Agreement arrangements has fallen from 372,134 in 1996 to 345,000 units as at the last available figures in 2003-04. That is a drop of 27,000 units in a 10-year period, at a time when the demand for housing has grown dramatically and when the cost of housing has risen to extraordinary levels. As a result of the reduction in stock and the availability of accommodation, the government policy has forced upon the states changes in the sorts of people who are able to use that stock. The number of new people getting assistance under the Commonwealth-State Housing Agreement has fallen from 50,000 in 1996 to 25,000 this year. There has been a drop of half in the number of new people. As a result, only half as many people have access to the moneys provided by this parliament. It is expected that by 2009 there will only be 15,000 each year who will access that stock.
So we have a reduction in funding, a change in the people who are getting access to it and a situation where people are poorer, their needs are greater and their opportunities to get into the private housing market are more limited. This is at a time when the housing market in the private sector is becoming increasingly expensive. The Commonwealth says: ‘We now have Commonwealth rent assistance arrangements.’ It is a disingenuous claim because the government uses figures based on the situation after its massive cuts to the programs in 1996. It claims that from 1997 rent assistance can be compared to current figures. In 1996, there was a reduction of some $200 million in Commonwealth assistance. If we take that into account and compare like with like, we see that rent assistance over this period has increased by 0.3 per cent. So we have increasing needs but no increase in the level of support from the Commonwealth. If we combine the Commonwealth-State Housing Agreement funds and the Commonwealth rent assistance funds in the period from 1996 to 2004 in constant dollars, we see a reduction in the level of funding by some $310 million. The Howard government spent over $300 million less on housing assistance in 2003-04 than it did in the period from 1996, when it came into office. (Time expired)
This Audit Office report is into the Commonwealth-State Housing Agreement. It is a follow-up audit on an earlier audit of the operation of that very, very important agreement between the Commonwealth and the states—and indeed the territories as well—on funding for the provision of public and community housing.
Let me first note the positive, which is that the Department of Families, Community Services and Indigenous Affairs has made significant progress in implementing the recommendations from the previous National Audit Office report into this area. But there are a couple of aspects that I do think need highlighting from this current report, most notably the finding that the timeliness and performance reporting, particularly through the Housing Assistance Act annual report, needs improvement.
This is something I have commented on myself in this chamber a number of times so I am pleased to see that the Audit Office agrees with me. As the report states here, throughout the 1999 Commonwealth-State Housing Agreement the annual report was tabled in parliament between 16 and 32 months after the associated reporting year. This improves slightly for the first report provided under the 2003 CSHA which was tabled 15 months after the end of the associated reporting year. That is still, in my view, grossly inadequate. We are talking about reporting on the data, on the performance of all the states and territories in conjunction with the Commonwealth, in fulfilling the components of the Commonwealth-State Housing Agreement, which is a significant amount of money—more than $1 billion a year—and also the data about how that money is being spent and delivered with regard to housing.
The department has suggested that it will endeavour to have the annual report—only endeavour, I might say—tabled by June of the year following the end of the grant reporting year. Whilst that is an improvement, I again agree with the Audit Office that it would be of benefit for it to be tabled earlier. I realise that there are limitations because data needs to be provided from the states and territories before it can be collated and presented to this parliament, but it is a crucial area where there have been significant failures, and obviously the blame for those failures needs to also rest with some of the state and territory governments.
The Audit Office also believes there is further scope for improvement of the information on the CSHA contained in the annual report and in the family and community services annual report as well. That is not a view that should be dismissed lightly. We have reports on this provision of public money into this very important area of public and community housing around the country. The reports are presented about 16 months after the appropriate reporting year and, even when they are presented, the amount of data is still inadequate. That is unacceptable and, in my view, it signals an attitude at federal level—and I fear at state level as well in some areas—that this area of public and community housing is really not that important any more. It has been turned into a residual housing area, it is seen as a welfare issue, an afterthought or a bottom end of the market view, and it really does not get the attention it deserves.
I remind all senators and the public in general that there have been studies conducted, including by very dry economic evaluating institutes such as the Productivity Commission and, more significantly, the former Industry Commission, which showed that using public money to provide public housing was the most efficient way of using public money to deliver housing outcomes. It is certainly more efficient than the huge amount of money that is spent at federal level now on rent assistance. I am not saying that rent assistance should be cut but I do say that if more focus was put on providing public and community housing it would actually produce a better outcome than just propping up the profits of private property investors—landlords—through giving extra rent assistance to their tenants.
It is also more efficient than providing, in effect, tax breaks and the cost of tax expenditures to people through things like negative gearing. The best value for money for the taxpayer is actually to spend money—more money—through the provision of public and community housing. The continual, gradual decline in the focus on this area at federal level, but also at state level in many areas and including Labor state governments, is a cause for great concern. I fear that the damage done in this area—the continual decline in public housing stock and the continual decline in the attention given to this area by governments, state and federal—may soon be irreversible and that is a great shame.
I draw senators’ attention to an article from the Guardian in the UK which I am sure you have already read today, Madam Acting Deputy President Moore. It talks about the property market in the UK but I think it is equally apt for Australia—and, in fact, I suspect it is even more applicable to Australia—and it refers to the obsession with property as a form of investment. To paraphrase this article by Mr Lionel Shriver and what he calls the property psychosis, there is a yearly increase in property values that keeps going up and is widening the gap between the haves and the have-nots, so more and more people at the bottom cannot afford to buy anything.
As I said earlier in the debate on the Welfare to Work legislation, there is a growing wealth gap between the haves and the have-nots in Australia and the cause of that wealth gap—if you like, the underlying earthquakes that are shifting the plates and causing those different groups in society to move further and further apart—is increasing property prices.
That gap was significantly enhanced and increased by the decision back in the year 2000 to provide a massive windfall to the highest income earners and the highest wealth individuals in this country through the discounting of the capital gains tax—a decision supported by the Labor Party on the grounds that the government would then close the loopholes regarding the tax treatments of trusts. The government never acted on that and the Labor Party was complicit in providing a massive tax break for the highest income earners. However much people want to beat up those Democrats who supported the GST, that particular decision by the ALP provided a far greater windfall to higher income earners and a far greater problem in its impact on those who are less well-off than any negative aspect that people might have perceived about the GST.
There is an extraordinary attitude towards housing in Australia—and I am not criticising people who invest in property. In fact, in many respects, it is an incredibly rational thing to do if you are able to do it. But it is about the only good in Australia which is regularly reported as positive if the price goes up. The more the price goes up, the more that is portrayed as a good thing. It is obviously a good thing if you are a property investor, but it is a bad thing if you are somebody who wants to access the housing market—a first-home buyer, a young couple, a young family or anybody who wants to have a property of their own. That is the source of the greatest gap, the growing gap, in wealth in Australia, which is becoming so large that it will soon be unbridgeable.
The Commonwealth-State Housing Agreement on its own cannot bridge that gap, but the lack of attention at federal level given to the crisis in housing affordability is a major indictment of this government. I have asked questions of the government about this area from time to time over the years. Their only response is: ‘Housing is a state issue. Our job at federal level is to keep interest rates low.’ It is good that interest rates are kept lower than they might otherwise be, although it depends on how you assess them in relative terms. But, in many ways, in combination with other factors—let me stress that—such as negative gearing tax breaks and capital gains tax breaks, keeping interest rates low may perversely make housing more expensive by people using it as an investment.
There is more that should be done there. The federal government have failed. The federal Treasurer specifically dodged this issue by sending it off to a Productivity Commission inquiry and then ignoring the recommendations that applied to the federal government to do something to address the crisis in housing affordability. It may be something that the government do not care about, as long as their mates are getting richer on the property investment market. Maybe they do not care, but millions of Australians are falling further behind, either by their inability to get into the housing market or by having to mortgage themselves up to their eyeballs and beyond to try and get into it. The lack of policy attention at a national level is a major problem, and it is inexcusable. I seek leave to continue my remarks later. (Time expired)
Leave granted; debate adjourned.
by leave—I present the report of the Australian parliamentary delegation to the Asia Pacific Parliamentary Forum and to Papua New Guinea, which took place from 15 to 25 January 2006. I seek leave to move a motion in relation to the report.
Leave granted.
I move:
That the Senate take note of the document.
The delegation to the APPF and Papua New Guinea included the member for Mitchell as leader, Senator McEwen and the member for Kingston. I was deputy leader of the delegation. In preparing for the APPF, the delegation was conscious of the substantial contributions of previous Australian delegations to the annual APPF meetings. For this reason, and because the APPF is important for us as an assembly of members of national parliaments in this region, the delegation was keen to ensure it participated as actively as possible at the meeting. As the report shows, the delegation did continue that substantial contribution to the work of the APPF.
Chapter 1 of the delegation’s report contains a general discussion of the role and operations of the APPF, and chapter 2 provides a detailed review of our participation at the January meeting and that meeting’s outcomes. The agenda for the meeting covered a range of subject matters that are relevant to our region. Broadly, these were political and security issues, economic and trade issues and cooperation to address regional issues of common interest.
In preparation for the meeting, the delegation proposed resolutions on three of the agenda items. These were international terrorism, on which I spoke, poverty alleviation and the Millennium Development Goals, on which Senator McEwen spoke, and pandemic disease, on which the member for Mitchell spoke. The member for Kingston spoke on cooperation on empowering the economies of developing and least developed countries.
As well as speaking in the plenary forum, the delegation participated in the work of the drafting committee throughout the meeting. The drafting committee had an extensive meeting program, often running in parallel to the plenary forum. At its meetings, the drafts of all proposed resolutions were negotiated until it was agreed they were in a state that could be put to the plenary forum for final consideration and endorsement.
Although there was a very full formal program for the APPF, the delegation was able to participate in several other meetings in Jakarta. Chapter 3 of the report discusses these parts of the delegation’s program. One particularly interesting meeting was a visit, arranged with the help of the embassy and staff of the World Food Program, to a program project in East Jakarta. AusAID supports this project, which provides nutritionally enriched biscuits each day to young children at school. Without these biscuits, the children are likely to be malnourished.
It was a great experience to visit this project. The children seem to enjoy the biscuits and the discussions that their teachers have with them about nutrition and health. The delegation found the visit to be rewarding, as we were able to speak to the children, teachers and other members of their community as well as to the WFP staff. The dedication and optimism of the teachers and the WFP staff was extremely impressive. After we visited the school, we spent some time walking around the community. Meetings such as this provide a unique opportunity to gain an understanding of the lives of ordinary people and to express to them our goodwill and interest in their future.
At the conclusion of the APPF meeting, we travelled to Papua New Guinea, where we began our program with a visit to the Bomana War Cemetery near Port Moresby. The sight of so many Australian war graves brought home to us the historic links between our country and Papua New Guinea. We had a number of valuable meetings in Port Moresby and were fortunate to visit Goroka, Kundiawa and Mount Hagen. It was important for us to see something of the provinces and go beyond Port Moresby. To see first-hand the difficulties faced by the local people—for example, in transport and infrastructure—was very valuable for us. To see the natural beauty of the highlands landscape was also a great experience.
Although our visit to Papua New Guinea was brief, we met a diverse range of people. These people included patients and their families at regional hospitals, businesspeople, workers in a coffee factory and their families, medical researchers, staff of NGOs and colleagues from provincial parliaments and the national parliament. We were fortunate to have discussions with a number of Australians who choose to live and work in Papua New Guinea. Their understanding of their adopted home and respect for its people and culture left a strong impression on us.
Chapter 4 of the report outlines the meetings in which the delegation participated in Papua New Guinea. I would like to emphasise that at each of those meetings—whether they were formal parts of the program or otherwise—we were welcomed with friendliness and openness. Certainly we heard about some of the difficulties facing our neighbours there; but we were also left with the impression that there are leaders and members of communities with sufficient capacity, energy and motivation to ensure a more secure, prosperous future for the people of Papua New Guinea.
Before I conclude my remarks, I want to acknowledge a number of people who contributed so much to the delegation’s visits. None of us will forget the hospitality we received in Jakarta from the President, the Speaker, and the Governor of Jakarta, as well as the friendliness of people we met informally around Jakarta. Nor will we forget the welcomes we enjoyed at each stage of our visit to Papua New Guinea.
The delegation was ably assisted by the Australian Embassy in Jakarta, in particular by the ambassador, Mr Bill Farmer, and by Steven Barraclough. We appreciated very much the comprehensive briefings and assistance that were provided. In Papua New Guinea we received great assistance from the high commissioner, Mr Michael Potts, and from Tim Paterson and Solstice Middleby. They gave close attention to our program and arrangements to ensure that we were well informed and able to observe and discuss the impact of some of the current issues in Papua New Guinea and its relationship with Australia.
I also want to acknowledge and thank the staff of the Australian Department of Foreign Affairs and Trade, the Parliamentary Library and the Parliamentary Relations Office, who gave us great assistance with briefing material, advice and travel arrangements. During both our visits the delegation was accompanied by Mr Phil McDonald of the Australian Federal Police. His presence and advice were welcomed by all of us. I wish to thank my fellow members of the delegation. Throughout a demanding program we worked cooperatively. We are grateful for the opportunity to establish links with our colleagues from parliaments around the region, particularly those from Indonesia and Papua New Guinea. We are equally grateful for the opportunity to exchange views with ordinary members of communities in both places.
Finally, on behalf of the delegation I wish to extend a sincere and heartfelt thank you to Ms Catherine Cornish, the delegation secretary. She was absolutely worth her weight in gold; she was a diamond, and we thank her very much for her efforts.
I also wish to speak to the report of the parliamentary delegation to the 14th annual meeting of the Asia Pacific Parliamentary Forum in Jakarta and the bilateral visit to Papua New Guinea. Like Senator Sterle, I would like to extend my thanks to all the people who assisted with preparation for the trip, including the staff of the Department of Foreign Affairs and Trade, the Parliamentary Library and the Parliamentary Relations Office. I echo his sentiments about the delegation secretary, Catherine Cornish. She worked tirelessly throughout our program, kept us entertained with her endless good humour and made sure the delegation was always well briefed and ready for anything.
I also acknowledge the dedication and patience of our Australian Federal Police officer, Mr Phil McDonald. He is currently serving in Timor Leste, and I am sure Senator Sterle will join me in wishing him a safe and speedy return. While in Indonesia, we were also greatly assisted by Mr Nando of the APPF liaison office in the Indonesian house of representatives.
It was indeed a privilege to be able to travel to Indonesia and Papua New Guinea as a member of the Parliament of Australia. It was my first occasion to travel overseas in that capacity, and I believe it was very appropriate that my first trip overseas was to the nations of the Asia-Pacific region—all countries that are close to Australia’s history and integral to our future.
The visit was particularly timely, as it occurred just prior to the release of the government’s aid white paper, and many of the issues discussed with representatives of the governments that we met during our visit are dealt with in the white paper. We were given the opportunity to visit AusAID-supported projects in both Jakarta and Papua New Guinea. To witness first-hand Australia’s aid program in both countries and to hear the sometimes frank views of parliamentarians and local officials from countries that receive Australian aid was very useful in terms of ensuring that, as politicians, we have a realistic and practical view of our aid relationships with our near neighbours.
As Senator Sterle said, the objectives of the APPF are, broadly, to promote better regional cohesion and cooperation between the 27 member nations of the forum. The report outlines the contributions made at the forum and in the drafting and plenary sessions by the Australian delegation, so I will not reiterate those, but I certainly call those matters to your attention. I note that during the APPF meeting the representatives of Chile were very pleased to be able to announce that, on 15 January 2006, Michelle Bachelet was elected as President of Chile. She is the first woman elected as president of that nation, and she is a single mother with three children. Given that women’s participation in politics was one of the matters for discussion at the forum, this was welcome news, and Australian delegates offered their congratulations to the Chilean delegation.
I acknowledge the hard work of the other members of the delegation: Mr Alan Cadman, who was leader; Mr Kym Richardson, the member for Kingston, in my own state; and Senator Sterle, who was deputy leader of the delegation. Compared with some other nations, Australia sends a relatively small delegation to this important forum. Given the leading role we take in assisting with negotiations and finalisation of resolutions, there was much work to be done.
As Senator Sterle has said, apart from the formal business of the forum, the delegation visited a World Food Program in a Jakarta school. We also met with young Australian and Indonesian Islamic activists, who were participating in the Australian Muslim exchange program, at a function hosted by the Australian Ambassador to Indonesia, His Excellency Mr Bill Farmer, and Mrs Farmer. The support provided by the ambassador and the embassy staff was exemplary. They ensured that we had plenty of opportunities to broaden our understanding of the very important relationship between Australia and Indonesia. The less formal opportunities to engage with other member countries at the APPF were many, and I am sure none of us will forget the singing entertainment provided by the President of Indonesia, the Speaker of the house of representatives of Indonesia and the Governor of Jakarta at the salubrious functions they hosted for all the delegates.
In Papua New Guinea the delegation made the most of its short time. The high commissioner, His Excellency Mr Michael Potts, and the staff of the high commission—particularly Ms Solstice Middleby and Mr Tim Paterson—ensured that we met a wide range of political and community leaders both in Port Moresby and, as Senator Sterle said, in the regional areas of Goroka, Mount Hagen and Kundiawa. Travelling by car along Papua New Guinea’s major ‘highway’ from Goroka to Mount Hagen brought home to us the enormous problems faced by our neighbours, whose economic and social wellbeing is frustrated by not having basic infrastructure—like navigable roads.
Our visit to the AusAID part sponsored AT Projects facility near Goroka showcased some examples of provision of basic services using low-cost, local and innovative solutions. One example we saw was the utilisation of the talents of a young Indigenous woman architect, who had designed a respite facility for people suffering from AIDS. This facility, using traditional design and local materials, was able to be constructed with local labour and would provide comfortable and warm accommodation for one or two AIDS sufferers and their carers in a village setting.
As we know, Papua New Guinea is facing a crisis with the highest incidence of HIV-AIDS in the Pacific region, and some estimates indicate that the rate of infection will increase by between 15 and 30 per cent annually. Assisting Papua New Guinea to acknowledge, confront and respond to the potential HIV-AIDS epidemic is one of the great challenges facing our two countries. And, of course, the people of Papua New Guinea are disproportionately affected by easily preventable diseases such as tuberculosis and malaria, a fact that was highlighted by our visit to the hospital in Mount Hagen, where those two diseases are major reasons for hospitalisation. As Senator Sterle said, we were fortunate to visit other places in Papua New Guinea, including the Coffee Industry Corporation and a coffee processing plant where the differences in health and safety standards between our two countries were, unfortunately, patently obvious.
It was particularly pleasing to meet on her own turf Dame Carol Kidu, the only female member of the National Parliament of Papua New Guinea and, I know, a friend of many in this parliament. It was a privilege to visit her home in Port Moresby and to meet the participants in a project she sponsors where young offenders learn how to propagate and sell garden plants at a local market, thereby earning a legitimate income through employment which offers them hope and respect.
The opportunity to meet with representatives of the Australia business council and local politicians gave our delegation an insight into the future prospects for Papua New Guinea’s economic future, particularly in the areas of mining, gas export and tourism development. There was hope and optimism from all those people for the future of Papua New Guinea, although the need for political stability was echoed by everyone we met.
Finally, like Senator Sterle I would like to make mention of the fact that we did visit the Bomana War Cemetery. I had been there before but it is always a salutary place to visit, to remind oneself of the cooperation of the people of Papua New Guinea and the assistance that they gave to our troops during World War II. I commend the report to the Senate.
Question agreed to.
by leave—I, and also on behalf of Senators Nettle and Stott Despoja, give notice that, on the next day of sitting, I shall move:
Bills received from the House of Representatives.
I move:
That these bills may proceed without formalities, may be taken together and be now read a first time.
Question agreed to.
Bills read a first time.
I table a revised explanatory memorandum relating to the bills and move:
That these bills be now read a second time.
I seek leave to have the second reading speeches incorporated in Hansard.
Leave granted.
The speeches read as follows—
The bill gives effect to the Government’s announcement in its energy white paper Securing Australia’s Energy Future of 15 June 2004, that the current complex system of fuel tax concessions will be replaced by a single fuel tax credit system from 1 July 2006.
The introduction of the fuel tax credit system will lower compliance costs, reduce tax on business and remove the burden of fuel tax from thousands of individual businesses and households.
When the fuel tax credit system is fully implemented, fuel tax will only be effectively applied to:
This bill sets out the principles concerning a taxpayer’s entitlement to a fuel tax credit and the mechanisms for claiming a credit.
Businesses will generally be entitled to a fuel tax credit for fuel they acquire, manufacture or import for use in carrying on their enterprise. For the use of fuel on-road in heavy vehicles the credit will be equal to the effective fuel tax less a road user charge.
Businesses will also be entitled to a fuel tax credit for taxable supplies they make of kerosene or heating oil for domestic heating and taxable supplies they make of packaged fuel such as kerosene, mineral turpentine and white spirit for use other than in an internal combustion engine.
Non-business taxpayers will be able to claim a fuel tax credit for fuel used by them in generating electricity for domestic use.
The use of fuel on road in diesel motor vehicles will generally not be entitled to a fuel tax credit unless the vehicle meets one of four emission performance criteria.
Claimants will be responsible for self-assessing their entitlements and will claim a fuel tax credit through their Business Activity Statement in the same way as they claim their Goods and Services Tax input tax credits. A separate claiming mechanism will apply for non-business taxpayers claiming a credit for fuel used in electricity generation for domestic use.
The bill contains a requirement that large fuel users, those receiving more than $3 million per year in fuel tax credits, join the Greenhouse Challenge Plus Programme in order to receive payment of credit entitlements.
The companion bill, the Fuel Tax (Consequential and Transitional Provisions) Bill 2006, relates to the transition from the existing arrangements to the fuel tax credit system, the phasing in of extended entitlements and the administration of the new system.
Full details of the measures in the bill are contained in the explanatory memorandum.
FUEL TAX (CONSEQUENTIAL AND TRANSITIONAL PROVISIONS) BILL 2006
This bill is a companion bill to the Fuel Tax Bill 2006.
The bill provides the transitional arrangements to phase in the fuel tax credit scheme while phasing-out the Energy Grants (Credits) Scheme, Fuel Sales Grant Scheme and the States-administered Petroleum Products Freight Subsidy Scheme. Changes to implement the fuel tax credit system will be phased in from 1 July 2006, with final changes taking effect from 1 July 2012.
Entitlements under the Fuel Sales Grant Scheme and the States-administered Petroleum Products Freight Subsidy Scheme will cease to exist for fuel sales or deliveries made after 30 June 2006.
The purpose of the transitional provisions is to ensure that claimants receiving a grant continue to benefit from fuel tax concessions, and to phase in the extension of eligibility for off-road business use of fuel over time. Currently ineligible off-road activities will become eligible for a 50 per cent fuel tax credit from 1 July 2008 and a full credit from 1 July 2012.
The bill also makes consequential amendments to other legislation. The consequential provisions primarily amend the Taxation Administration Act 1953 to bring the administration of the fuel tax credit system within the administrative framework of other indirect taxes under that Act. Amendments to the Taxation Administration Act 1953 are also part of a rewrite of the provisions affecting indirect taxes in a drafting style adopted by the Tax Laws Improvement Project aimed at making tax legislation more comprehensible.
The legislation also clarifies the extent of eligibility for off-road credits provided for ‘mining operations’ under the Energy Grants (Credits) Scheme. ‘Mining operations’ is intended to only cover the extraction of naturally-occurring minerals. The legislative changes clarify that the:
do not constitute mining operations. These changes take effect from today.
The bill will fully implement the fuel tax credit system by 1 July 2012 and the existing Energy Grants (Credits) Scheme will be abolished by that date.
Full details of the measures in the bill are contained in the explanatory memorandum already presented.
Debate (on motion by Senator Abetz) adjourned.
Ordered that the resumption of the debate be an order of the day for a later hour of the day.
Bill received from the House of Representatives.
I move:
That this bill may proceed without formalities and be now read a first time.
Question agreed to.
Bill read a first time.
I move:
That this bill be now read a second time.
I seek leave to have the second reading speech incorporated in Hansard.
Leave granted.
The speech read as follows—
TAX LAWS AMENDMENT (MEDICARE LEVY AND MEDICARE LEVY SURCHARGE) BILL 2006
This bill will increase the Medicare levy low-income thresholds for individuals and families in line with increases in the consumer price index. The low-income threshold in the Medicare levy surcharge provisions will similarly be increased. These changes will ensure that low-income individuals and families will continue not to have to pay the Medicare levy or surcharge.
The bill will also increase the Medicare levy low-income threshold for pensioners below age pension age to ensure that where these pensioners do not have a tax liability, they will also not have a Medicare levy liability.
The amendments will apply to the 2005-06 year of income and later years of income.
Full details of the measures in this bill are contained in the explanatory memorandum.
I commend this bill.
Debate (on motion by Senator Abetz) adjourned.
Messages from His Excellency the Governor-General were reported informing the Senate that he had assented to the bills.
I move:
It will come as no surprise that Labor opposes these regulations just as we oppose the legislation that they sit under. These regulations give effect to much of the government’s extreme industrial relations changes. Over the weeks and months since the government’s extreme changes have been in place, we have started to see the effect on Australian workers and their families. These regulations followed the proclamation of the government’s legislation. They were dropped late in the afternoon of Friday, 17 March. It was only later over the course of that weekend that the government sneakily published these regulations with the Minister for Employment and Workplace Relations finally publicly drawing attention to them on the Sunday, which happened to be the same afternoon that the Commonwealth Games women’s marathon was determined.
Those regulations and their related explanatory materials bring the government’s so-called single system and simplified legislation to a total of more than 1,800 pages—1,252 pages of legislation and explanatory materials and 592 pages of regulations and supplementary materials. This is their so-called single, simplified system. It is more than 1,800 pages of complexity and complication that Australian business, Australian industry, small business and employees had to come to grips with with less than a week before it came into effect on 27 March. Like everything with this government and industrial relations, the devil is in the detail, and with more than 1,800 pages of complexity and complication there is a lot of detail—and there is a lot that Labor opposes.
I want to first talk about the issue of prohibited content. This is probably the area where the extent to which the government is willing to go to impose its extreme and radical agenda on Australian workers and their families is most clearly shown. The prohibited content provisions, apart from their philosophy being problematic, are extraordinarily complex. They alone are enough to make a sick joke of the claimed simpler, fairer tag line that this government continues to use to promote its radical changes in industrial relations. The regulations in relation to prohibited content are nothing but a crass and overt reduction of the bargaining power of employees in the workplace.
Given that this government trumpets the freedom of the individual and the freedom of contract as the basis of the way they wish to move forward in industrial relations, it is extraordinary that they are imposing through legislation and regulations such powers on a single person, the minister for workplace relations, to intervene in the negotiations between employees and employers so as to ensure certain things cannot be discussed, cannot be included, and that certain rights cannot be agreed to be given to employees. The prohibited content regulations severely restrict legitimate workplace-bargaining activity. They severely restrict what can legitimately be negotiated between employees and employers. In particular, they limit the capacity of trade unions in the workplace to act as the legitimate and chosen representative of employees, even if those employees wish that to be the case.
Let us go through some of the prohibited content in agreements which will be defined as such as a result of the regulations: deductions from wages of union dues or the provision of payroll deduction facilities for union dues; leave to attend training provided by a trade union, even if it is occupational health and safety training; paid leave to attend meetings conducted by or made up of trade union members; the renegotiation of a workplace agreement; the rights of an organisation of employers or employees to participate in or represent an employer or employee bound by the agreement in whole or part of a dispute-settling procedure unless the organisation is the representative of the employer’s or employee’s choice; right of entry; and the provision of information about employees bound by the agreement to a trade union or a member acting in a representative capacity unless provision of that information is required or authorised by law.
However, the prohibited content provisions do not just limit themselves to restricting the activities of unions as representatives in the workplace. They also extend to ensuring that workers in this country do not have access, if they are with an employer of less than 100 employees, to remedies for unfair dismissal, even if, as I indicated, this is agreed between employer and employee. This government is so worried about employees in this country being able to challenge a dismissal that is unfair that not only are they content to remove it from the legislation but they actually want to prohibit such rights being included in an agreement.
Regulation 2.8.5 contains the following:
A term of a workplace agreement is prohibited content to the extent that it confers a right or remedy in relation to the termination of employment of an employee bound by the agreement for a reason that is harsh, unjust or unreasonable.
Just to make sure employers and employees do not seek to have these matters included in an agreement, this government is imposing a penalty for breaching the prohibited content regulations. In effect this means that, if an employer or employee seeks to have an unfair dismissal provision in the agreement, they can be hit with a $6,000 fine. If a union seeks a similar provision, the union can be hit with a $33,000 fine. If this is not bad enough, schedules 4 and 5 of the regulations ensure that the minister will now have a direct role in the oversight of every agreement made in the country. Through schedule 4, the Australian Industrial Relations Commission is required to provide to the minister detailed information, including relevant documents, names of parties, individuals and organisations et cetera, in relation to agreements.
Schedule 5 is similarly heavy-handed. It provides that the Office of the Employment Advocate provide to the minister information and copies of documents that relate to employment relationships. According to schedule 5, the minister is now to receive copies of agreements, variations to agreements and orders terminating agreements, all within three weeks of the making of the variation or the making of the agreement. As well, detailed information about agreements, including the title, number of the agreement, date of lodgment, description of the work undertaken and the names and addresses of the business to which the agreement applies, are now all to be supplied to the minister. Just what this is trying to achieve on a practical level is unclear. But one thing is clear—that is, that the government wants a direct and interventionist role by the minister in the operation of each and every workplace across the nation. This is direct interference by the minister and his office, and such direct interference by the minister and his office into the content of individual agreements is an appallingly bad example of public policy. The decision to give this minister or any minister executive power over what can and cannot be included in the agreements through prohibited content is extraordinarily bad policy.
I want to return to the issue of transitional arrangements. This is an area where the complexity of the government’s legislation, frankly, is quite breathtaking. This government has made a complete jurisdictional dog’s breakfast of its so-called single industrial relations system. Whilst the High Court will clearly determine the jurisdictional coverage of Work Choices, even by the government’s own admission only up to 85 per cent of the country’s workforce will potentially be covered by the government’s changes. That will mean that around 1.5 million employees will remain outside the jurisdictional coverage of the government’s changes. Irrespective of the High Court’s outcome, which could in fact reduce the number of people potentially covered by the government’s changes, all this will mean is more incomplete and more inconsistent coverage across the nation’s workplaces. The process of moving state awards and agreements to the federal jurisdiction is so complex that, frankly, many employers and employees will be unsure precisely what their rights and responsibilities are. But that is not stopping this government. The regulations confirm this government is intent on overturning the states’ recent attempts to preserve the pay and conditions of employees under state industrial relations systems.
The issue of part heard matters, which was an issue raised by Labor on a number of occasions in the committee discussion on this bill, is no clearer either. The transitional provisions provide that part heard dispute matters before the commission either lapse entirely or at least lapse in relation to employers defined under the act as corporations. However, appeals against awards and orders can continue as per the old state industrial system, while part heard equal remuneration applications are to be heard under the government’s new provisions. This will be a field day for the lawyers.
Despite all this complexity and confusion, the government simply keeps claiming that all these changes—all 1,800 pages of complete legislation and associated explanations—are necessary for the continued economic health of our nation. Let us look at precisely what we do know about Work Choices. Let us look at what the Office of the Employment Advocate has told us. Of the 6,263 Australian workplace agreements lodged since Work Choices commenced on 27 March, this is what it can tell us about what is contained in them: 100 per cent excluded at least one protected award condition, 64 per cent removed leave loadings, 63 per cent removed penalty rates, 52 per cent removed shift work loadings, 40 per cent lost gazetted public holidays and 16 per cent excluded all award conditions and replaced them with the government’s legislated minimum standards. We already know what the impact of Work Choices is. It is clear from the government’s own figures and its own data from the Office of the Employment Advocate. These are figures and statistics which confirm exactly what Labor has been saying all along: that the agenda behind this so-called Work Choices, this radical industrial relations agenda, is the driving down of the wages and conditions of Australian workers and their families.
Sixty-three per cent of AWAs removed penalty rates. This government may be so out of touch it does not realise this: there are a great many families which rely on penalty rates, overtime and shift loadings in order to meet their financial requirements. That is what many people rely on to make sure ends meet. Under your system, the vast majority so far of Australian workplace agreements exclude penalty rates and remove leave loadings. We heard the minister today in question time using some very dodgy statistics in which he included managerial employees. I invite him to correct the record and tell us what the ABS actually says about the experience of non-managerial employees. Take managerial employees out of the equation and have a look at what the AWAs deliver. Have a look at what Australian workplace agreements deliver for women. Women on AWAs will receive 11 per cent less than those women on registered agreements. That is how much less Australian women are going to be paid as a result of this government’s extreme agenda.
You do not have to believe me and you do not have to believe your own figures from the Office of the Employment Advocate. Let us look at what Freehills have said. Anybody who has hung around the Senate estimates knows that this is a law firm that this government uses a lot. It is certainly not a law firm you would regard as a Labor law firm. What do Freehills say? This is their snapshot of the current arrangements: average annual wage increases in June 2004-05 in agreements generally, four per cent; union collective agreements, 4.3 per cent; and AWAs, 2.5 per cent. Looking at the 2004-05 figures, which is before this government’s extreme agenda actually got going, you will see that even Freehills say that essentially workers are better off when they are on collective agreements, much better off when they are on union collective agreements and far worse off when they are on AWAs.
What we know about this government’s extreme agenda is this: workers in Australia are being asked to trade away shift penalties, overtime rates and rostering certainty for the princely sum of 2c an hour. That is this government’s great economic contribution through the Work Choices legislation. The choice for Australian workers is that they have to give up their penalty rates, their overtime, their shift loadings and rostering certainty for the princely sum of 2c an hour. We will see between now and the next election how many more Australian workers will be put in that position and will face the fate of the Spotlight employees, which has been publicised in recent times.
The fact is this government has long held an ambition to reduce the minimum wage. It appears to be the government’s view—and this is consistent with the position that the Prime Minister and his ministers have been taking—that, if you reduce the minimum wage in real terms, this will lead to an increase in employment, particularly at the lower end of the scale. The reality is, had the government got its way and had each of its submissions to the Industrial Relations Commission from 1997 to 2005 accepted, there would have been a cut in real terms of over 1½ per cent to the minimum wage: $50 a week, or over $2,500 a year, less than the current minimum wage. That is the government’s actual position when it comes to those Australians who struggle on minimum wages.
The government has not been content with simply making submissions to the Industrial Relations Commission. Through its Work Choices legislation, it is imposing the so-called Fair Pay Commission—probably better known as the low-pay commission—which will have legislative parameters that are clearly designed to keep downward pressure on the minimum wage. Unlike the Industrial Relations Commission, this new unfair pay commission is not required to take into account ‘the need to provide fair minimum standards for employees in the context of living standards generally prevailing in the Australian community’. Who can forget the government voting against an amendment moved by the opposition during the Work Choices debate because they did not want the word ‘fair’ in the legislative parameters for the Fair Pay Commission. They voted against making sure that the Fair Pay Commission’s job was governed, at least in part, by a notion of fairness.
How can you have a Fair Pay Commission when you do not even have the courage to include fairness in the legislative parameters? You voted against Work Choices having fairness in the legislative parameters because you do not want a fair minimum wage—that is not what you want. If you did want it, you would not have voted against fairness being one of the criteria that this commission has to have regard to when setting the minimum wage. Essentially, the principle of fairness has been stripped from consideration of the level of the minimum wage, as has the question of living standards generally.
I want to briefly talk, in the time remaining, about the government’s assertion that this is the way forward for the Australian economy. The way forward is the 2c an hour that a number of Australians have already faced. The way forward is no rights with regard to unfair dismissal for many millions of Australian workers. The government’s assertion that higher minimum wage levels inevitably lead to higher levels of unemployment simply does not stack up.
Let us have a look at some of the overseas examples: Denmark, Iceland, Norway and Sweden all have lower levels of unemployment than Australia despite the fact they have so-called high levels of employment protection. They are also ranked as more competitive than Australia by the World Economic Forum’s global competitiveness ranking and, on OECD figures, they all have higher productivity levels compared to Australia. And in the United States, the economic pin-up model of the government, the experience over the past five years has seen jobs growth rise by only 2.9 per cent while the minimum wage, in real terms, has fallen by 12 per cent.
If we now look to the budget papers, it is pretty clear that the government is even expecting employment growth to fall over the forward estimates period. These regulations are just more bad news for Australian employees and Australian workplaces. The government’s approach underlines the true nature of its agenda and its legislation—an ideological removal of choice. The government simply does not trust employers and employees to reach the most appropriate agreement for their circumstances. The government only wants them to reach an agreement with which the government is happy. That is what this legislation does: it is all about ministerial intervention; it is all about prohibited content; and it is all about the government imposing its view and its will on Australian employees and Australian workplaces. The government only wants people to reach the agreement that the government is happy with.
The government’s assertion that these changes will fix all the economic problems Australia faces is not just simplistic; it ignores the real drivers of productivity in our economy: the knowledge and skills of our workforce, the adequacy of our infrastructure and the ability of industry to meet emerging pressures through innovation. As a nation, we will not be internationally competitive and achieve sustained high levels of growth off the back of reducing wages and stripping conditions. Two cents an hour is not the way forward for the Australian economy. Unfortunately, the government simply does not get this. The government simply does not comprehend that down the path they choose lies a low-skill, low-pay and low-productivity economy that ignores the long-term requirements for a prosperous Australia.
What Australia needs is policies which are about building an economy that is productive and internationally competitive. And Australia needs a government that will do that while ensuring that the working conditions of Australian employees are fair. Everybody knows what this government wants. It wants Australian employers to be able to require their employees to give away all of their entitlements: give away your leave loading, give away your rostering certainty, give away your penalty rates, give away your overtime for 2c an hour. (Time expired)
The government opposes the motion. We were just told that the government is seeking to impose its will in relation to these matters and what the government wants in this debate. Let me confess right up front that the government does want to impose its will—its will that there be more people in jobs, that people have higher wages, that people have more flexibility in their employment situation and that there be more family-friendly provisions in workplace agreements that are entered into.
As with every significant reform that has been undertaken over the past decade, the Australian Labor Party have stood in the way. Each and every time they have said: ‘It will create an economic Armageddon. People will be thrown onto the unemployment scrap heap. People will be worse off.’ They said it about GST. They said it about our first wave of industrial relations reform. They said it about waterfront reform. They said it about welfare reform.
But of course, each and every time, the exact opposite has occurred. Unemployment has decreased. Real wages have increased. Unlike the situation under Labor which had one million of our fellow Australians on the unemployment scrap heap, we are now down below five per cent unemployment for the first time in three decades. Also over Labor’s 13 years in government real wages increased by—what was it?—1.2 or 1.3 per cent, compared to our 10-year period where real wages have increased by well over 10 per cent. In fact, 16 to 17 per cent is the figure. The workers of Australia know this, and that is why the workers of Australia have continued, very kindly, to support the Howard government: they realise and understand that our policies are designed to assist them in their aspirational approach to life.
Nowadays, not even one-quarter of the workforce are members of the trade union movement; it is about 20 per cent. The Labor Party are still stuck in the rut of representing those workers who are members of trade unions, as they should, and we of course seek to represent those workers as well. But we also listen to the other 80 per cent of workers who have made a conscious choice not to be members of the trade union movement. Unlike the Labor Party, who exclude the 80 per cent of workers who are not members of a trade union, we actually embrace them, we listen to them and we encourage them to fulfil their aspirations.
Yes, there are 1,800 pages to these regulations and yes, there is some complexity in this legislation. But Senator Wong knows full well and the Australian Labor Party know full well that under the former regime, with all the different state government legislation on top of the federal legislation, together with all the awards, you would have had hundreds of thousands of pages to deal with, not the hundreds of pages that we are dealing with now.
Mr Acting Deputy President, you will recall, as will others in this chamber, that when the Work Choices bill was being debated in this place—for 23 hours, I think, in the House of Representatives and for 32 hours in the Senate chamber; hours and hours of debate—there were these gross predictions that, as of 27 March, when the Work Choices legislation came into being, there would be wholesale sackings all around the country, the unemployment rate would go up and we would have a veritable economic Armageddon. Well, what has happened in the two months since Work Choices came in? After having hovered between five and 5.3 per cent for 20 months, the unemployment rate, according to Labor and union predictions, should have spiked up to 5.5 or six per cent. What did the unemployment figures do? They in fact went down to 4.9 per cent. The reason the unemployment rate actually went down was that, in the month of April, 22,000 new full-time jobs were created and, in the month of May, 55,000 new full-time jobs were created. Their predictions were wrong. Will they apologise to the Australian people and the workers that they sought to spook? Of course they will not. They did not do it on waterfront reform, they did not do it on industrial reform, they did not do it on GST reform, so why should they do it on this occasion?
Senator Wong told us that the minister could ‘interfere’ in relation to certain aspects of workplace relations. That is quite right: he can under this legislation. But this is where the dishonesty comes into this debate, because the power of intervention that is part of sections 102 and 103 of the Workplace Relations Act as amended is a replication of sections 43 and 44 as they used to be. There was no mention of that—no mention that this was simply a replication of that which existed before. It is another case of the Australian Labor Party being willing to say anything and do anything to run a scare campaign.
We are also told about prohibited content in agreements. This is very dangerous ground, I would have thought, for Senator Wong to traverse. She was humiliated at the Senate Employment, Workplace Relations and Education Legislation Committee budget estimates hearing when she asserted as fact that occupational health and safety training by trade unions would be banned. Mr Smythe, senior legal counsel—who is now off to the International Labour Organisation because he is so highly regarded—had to disabuse her of that view time and again until she finally got it, and then she said, ‘Well, can you understand why workers are confused?’ I will tell you why some workers in the community are confused: because people like Senator Wong have gone around the community peddling the misinformation that she has now unwittingly put on the Hansard record for all to see and read, when of course she was wrong. That is why she did not pursue that line today in this debate. She was very foolish to have even reminded me and others of it.
In relation to occupational health and safety, a matter of great concern to every Australian, whose jurisdiction is it? Everybody knows, or should know, that it falls fairly and squarely within the jurisdiction of the states and territories. Yet it did not stop the flip-flopping Mr Beazley from trying to make cheap political capital from the Beaconsfield mine tragedy when he was in Brisbane by suggesting that it might not have occurred if trade union training had been allowed, knowing full well that—well, chances are he did not know. I do not think he knew. And that is the problem with Mr Beazley: he will say anything at any time if it suits him. Having said that, just to make the point, let us have a look at what he has been saying about Australian workplace agreements. Here you see Mr Flip-flop in action, par excellence. On 4 July 2005, the Age newspaper reported that Mr Beazley said:
I dislike AWAs but—
listen to this—
there’s always been individual contracts ... and huge numbers of Australian workers have signed up to that.
Well, I can understand he dislikes AWAs, but I fully agree with him that there have always been individual contracts and a huge number of Australian workers have signed up to them—in fact, over 500,000 have.
Some 26 days later, on 30 July, he told another newspaper, the Australian:
We are going to abolish the capacity of AWAs to undermine collective awards. We are going to weight the balance of this in favour of collective agreements …
Then, on 2 August, to the Australian Financial Review, there was another version:
What I’m saying on AWAs is that nobody is going to bother with them once they are not in a position to.
Then, three days later:
But Mr Beazley argued that while unions wanted to ‘destroy’ AWAs, he wanted to ‘strangle’ them.
How hairy chested can you get? He wanted to strangle them! But then on 9 October, on the Sunday program, Mr Oakes asked Mr Beazley:
So you no longer subscribe to the policy Labor took to the last election, which was effectively to abolish AWAs?
Mr Beazley replied:
I subscribe to what I just said. There’ll be a million of those things in place when we come into office, and you can’t wander round cancelling contracts.
I would say ‘amen’ to that. It was one of those rare, lucid moments in Mr Beazley’s involvement in the IR debate. ‘You can’t wander around cancelling contracts’—I fully agree with him. Yet what did he say on 11 June to the New South Wales state Labor conference, without consultation with the caucus or with his shadow minister? He said:
So today delegates I announce that a Beazley Labor government will abolish John Howard’s Australian Workplace Agreements.
Remember those contracts that you could not go around the country ripping up? All of a sudden you can go around ripping them up. Why is that? Because Mr Beazley did yet another flip-flop.
We were told by Senator Wong about penalty rates, and how evil it was that penalty rates could be removed. Can I say this: they can only be removed by agreement with the workers.
Senator Marshall interjecting—
And some old union official across the chamber laughs and scoffs! Allow me to quote this to the honourable senator:
The result is that most employees in Australia are not paid penalty rates, but are paid more than the base wage. Even though unions don’t like to admit it, many have been involved in these agreements.
I remind honourable senators of the date here: 1991, which was some five years—half a decade—before John Howard was elected to government. It continues:
In 1991 I helped negotiate an agreement with—
wait for it!—
the Shop Assistants Union in South Australia to get rid of the 25 per cent late night penalty rate, the 30 per cent night shift penalty rate, the 25 per cent Saturday morning penalty rate and the 50 per cent Saturday afternoon overtime rate, in exchange for a payment of 5.25 per cent on the weekly wage. It was an agreement that worked well …
In other words, if unions can negotiate away penalty rates that is okay; but how dare individual workers ever think about doing that without the imprimatur of the paternalistic trade union movement!
That was enterprise bargaining. It was the union, not some hapless shop assistant. I bet it was for more than 2c an hour.
Order! Senator Hurley, you are out of order. The minister will be heard in silence.
And the person goes on to say:
It was an agreement that worked well even though some casual employees at the time lost more money in penalty rates than they gained in base salary.
Some workers were even worse off, and the trade union movement sanctioned it, five years before John Howard was elected to government. And yet they run around this country suggesting that this is somehow an extreme agenda, when the trade union movement itself negotiated these sorts of agreements because it knew that the workplace was changing and people’s habits were changing. The article continues:
So long as penalty rates can’t be taken off people against their will, the fact that penalty rates don’t have to be paid or equivalently cashed out in every situation is fair, and will help create more jobs.
Why did they do this? Because in this day and age employing people on Saturday afternoons or on late-night trading is hardly strange or unsociable, especially where the employee is, say, a university student for whom those hours are actually preferred.
So a case is made out that Australian workplace agreements trade off penalty rates—and they may well do. Of course, what Senator Wong told us about aspects of the Australian workplace agreements was only half the story. Yes, conditions were traded off, but she did not tell us about the increase in wages, the increase in family-friendly provisions and all the other benefits in those agreements.
I sat in Senate estimates and I did not hear much about the benefits.
Order! Senator Sterle, you are out of order. The minister will be heard in silence.
On these statistics, I will repeat what I said at Senate estimates: statistics are a bit like skimpy bathers—what they show is interesting; what they hide is vital. But might I say that in Senator Sterle’s case I doubt whether it would be either interesting or vital. But, that aside, you can make the statistics say what you want and you can say penalty rates were taken away. But there were wage increases in lieu, and to only paint half the picture is to tell a falsehood to the Australian people.
We also got the hoary old argument that we had removed fairness from the legislation—that the word ‘fair’ used to be in the preamble and its removal meant that we no longer believed in fairness. The old preamble did not have the word ‘harmonious’ in it; the new preamble does. So, if you accept the Australian Labor Party logic, the old act did not seek to create harmonious workplaces and the new one does. That sort of immature use of semantics is, unfortunately, the depths to which the Labor Party has had to sink to try to get an argument to fly with in this debate.
If you were to ask a worker, ‘Do you want a fair workplace?’ they would say yes. If you asked, ‘Do you want a harmonious workplace?’ they would say yes. Then if you asked the worker, ‘What do you think the difference is between a fair and a harmonious workplace?’ I reckon they would be left, like me, scratching their head wondering what the difference was. Of course, it is the same terminology to express the same sort of thing. We are about harmonious workplaces, and it is clear that is what we are delivering because industrial disputation under the Howard government is now at the lowest rate it has ever been since records were first kept. If workers are so much worse off under the Howard government, why is it that the rate of industrial disputation has fallen, like unemployment has fallen, and the only thing that has risen has been real wages, something that 13 years of Labor could never deliver?
There are other people in this debate. They will undoubtedly continue and follow the line of their leader, Mr Beazley, and Senator Wong and mislead and misrepresent this legislation. But at the end of the day these regulations are designed to put in place the Work Choices legislation—legislation that will ensure that the Australian economy and the people of Australia can prosper. Without the economy prospering, individual Australians cannot and will not prosper. We do not pursue economic reform because we are committed to economic reform per se; it is what economic reform can do for our fellow individual Australians, and that is to make a better life for them. The best social welfare policy a government can deliver is to ensure that every one of our fellow Australians that is capable of undertaking a job actually has one.
Mr Beazley said that the reform lemon of industrial relations had been squeezed dry and no more could be done. In other words, he was happy to have long-term losers on the unemployment benefit, and he admitted as much on TV. We say that is not good enough. Every single Australian deserves a job. We are very pleased that unemployment has now fallen below 4.9 per cent and we look forward to many more of our fellow Australians getting jobs as a result of Work Choices.
The regulations being debated before us today, while containing little different than what was foreshadowed late last year, do confirm the Democrats’ worst fears—that is, that the Liberal and National parties’ industrial relations changes are extreme, complex and unfair and will detrimentally impact on vulnerable or disadvantaged employees and job seekers over time.
Of course, the minister is both right and wrong. He is wrong in thinking that the Work Choices legislation is some kind of economic nirvana and that there will be no social effects. But he is right in believing that the sky has not yet fallen in. It has not yet fallen in for the very reason that many agreements that were struck under the old legislation have a long time to run. The other point is that anyone who is in an advantaged position in the job market is not going to be impacted negatively whilst there is a shortage of labour in certain sectors.
The regulations coupled with the Work Choices legislation are highly interventionist and one-sided, and our belief is that in the end they will hurt Australian society and the economy. Because of that, we think it inevitable that this government, if it remains in power, will have to amend them, and amend them significantly. Of course, if Labor achieve power, they will be thrown out altogether and a new system will be put in.
The sky might not have fallen in yet, although for those who are unfairly sacked or lose penalty rates or public holidays for the famous extra 2c a week I am sure it will feel like it. But these changes overall over time will radically alter our work and systems values and may end up creating a dog-eat-dog environment for those with low bargaining power, and they will suffer accordingly.
I am not deliberately exaggerating the impact of these reforms. In fact, it is not my style to do so. It must be remembered that these are fundamental reforms. These changes are nothing like those in the 1996 act that was produced, even before it was amended by the Democrats, because that 1996 act was the second wave of legislation built on the same foundations as the first wave, which was the 1993 act. These changes, in contrast, assault the cultural, economic, social, institutional, legal, political and constitutional underpinnings of work arrangements in Australia. Since the legislation and the regulations came into force, there have been cases that have received media attention of employees sacked for smirking, for restructuring purposes or for being too ill and of 60-year-olds being offered individual contracts that cut wages by $40 a shift, and so on and so forth.
In the Senate budget estimates committee hearing last month, federal Employment Advocate Peter McIlwain revealed that of the 6,263 individual contracts, known as AWAs, lodged with his office since the Work Choices legislation began, every one of the 250 analysed by his office did exclude at least one award condition. Sixteen per cent of Australian workplace agreements lodged under the new laws had dropped all award conditions and replaced them with the government’s five minimum conditions. They had gone down from 20 to five, if you looked at the maximum. Forty per cent of those AWAs dropped gazetted public holidays. Leave loading was erased in 64 per cent of agreements while penalty rates disappeared in 63 per cent. Fifty-two per cent of AWAs got rid of shift allowances.
These are major social impacts. These are things which affect how families live their lives, for example, when children are able to play sport or be with their families. It very much affects the social fabric. Pay increases over the life of the AWAs were provided for in 78 per cent of agreements, while 22 per cent had no change in pay. While a large percentage of the AWAs may have provided a pay increase, the actual level of increase commensurate with other benefits lost needs to be taken into account. In the recent and infamous case of Spotlight, Spotlight offered 2c more an hour to new employees to enter workplace agreements which were without penalty rates, without public holidays or without leave loadings. This is why the Prime Minister refused to guarantee before the legislation was passed that no worker or set of workers would be worse off. He knew he could not guarantee it, because large numbers of workers would be worse off and are worse off.
The Spotlight case highlights that these changes will have a disproportionate effect on women. Because women are in and out of the workforce as a result of caring responsibilities, women are a large proportion of low-income earners in Australia and are disproportionately employed in industries such as retail, clerical and community services and in part-time and casual work. When the Western Australian industrial relations system was deregulated during the Court government, which provided the template for these changes, those changes resulted in a decrease in wages, increased inequality and saw women in particular worse off. In February 1992, the Western Australian gender pay gap was 22.5 per cent. By May 1995, it had widened to 27.8 per cent. As HREOC noted during the Senate’s inquiry into Work Choices, the capacity for more vulnerable employees to bargain effectively and to choose their employment arrangements is impinged upon by the existence of so-called take it or leave it individual bargaining arrangements. The consequences are felt not only by workers but also by their children and families. It is the social effect which is very damaging from this legislation.
Under the new Work Choices legislation, these AWAs are unacceptable. Under the old Workplace Relations Act, while AWAs needed improvement and greater protections built into the system, they were workable. It is at that level that we parted company with the Labor Party, because we supported AWAs under the old federal act. We do not support the new AWAs under the Work Choices legislation. They are almost always take it or leave it contracts. Duress is not policed. There is no global no disadvantage test. There is no requirement to bargain in good faith, and the minimum conditions underpinning the contract are derisory. While it is unlikely that all Australians will be detrimentally affected by these changes, we do believe they will erode conditions for significant numbers of Australians over time. Because of that, we are hopeful that the government will take a step back from its very strong defence of these unfair laws and move to amend them before the community endures too much pain.
The Prime Minister and his ministers have successfully used doublespeak to conceal the true nature of these changes. Progressive words like ‘choice’, ‘flexibility’ and ‘freedom’ disguise the heavy authoritarian micromanagement and restrictions on collective labour—namely, the unions—and the dismantling of the architecture and infrastructure of our former workplace relations system. While the Prime Minister is correct that most of what is contained in these regulations does not change the intent and direction outlined in the Work Choices bill, the regulations do reveal just how interventionist and dictatorial this government will be. Unwisely, unprecedented ministerial intervention will replace the former sensitively balanced federal system where politicians were kept at arm’s length from work arrangements and disputes. This central planning model has alarmed some of the government’s backers, such as the HR Nicholls Society, who are reported as expressing concern that the new laws are too government-centric. In fact, they have likened the federal government’s new industrial relations laws to the former Soviet system of command and control. That is coming from the friends of the government!
The Industrial Relations Commission is required to report on a weekly basis to the minister on the number and details of applications for protected action ballots, suspension and termination of bargaining periods and applications for right of entry. The OEA must send the minister every workplace agreement within three weeks of it being made. This level of ministerial intervention is unheard of. Surely a senior minister would have better things to do with their time than interfere in the day-to-day workings of business, unless they are in command and control mode. It is quite mind-boggling that part of the justification for the government’s IR changes was to reduce third-party interference—that is, union involvement—yet what has happened is third-party interference in the form of the minister has reached levels which could be dangerous and are certainly unprecedented. This is doublespeak of the like we have never seen before. The now well-entrenched coalition executive style is also likely to mean that bias and secret agendas will contaminate what should be open public processes.
The regulations also appear to have raised more questions than they have answered and, rather than reduce the need for lawyers and third-party intervention, the complexity is in fact likely to result in the opposite. All up, the legislation and the regulations total about 1,500 pages of text to explain, compared to the law in New Zealand, which I am told does it in 20 pages. We are concerned that, in attempting to cover every angle with the intention of hamstringing unions, the government have created an overly complex system with the likelihood of many unintended consequences. I assure you that, if the Democrats had retained the balance of power, this Work Choices legislation would not have been law, although I can also assure you—probably to the consternation of some of my Labor colleagues—that this would have been a national system, because we agree with one system. When Labor reach power in due course, we do hope that you will at least retain that as a centrepiece of your workplace law. Of course, it does need to be agreed with the states. We have always acknowledged that.
We are concerned that, in attempting to cover all these angles, the regulations are creating real problems. For instance, the Australian Medical Association—hardly a hotbed of socialist activists—are concerned that the regulations do not clarify who can legally issue medical certificates for employees’ sick leave. This is an excellent example of how an unnecessary change of requiring employees to provide a certificate after one day of leave compared to two days leave is now having unintended consequences. From the viewpoint of an ordinary person, not leaving that whole bureaucratic function to the integrity and the ethics of the medical profession to decide on is really a great mistake.
There is uncertainty about cashing out annual leave, about whether employees can be paid under the minimum wage if it is averaged over a 12-month period. Rather than help small business, the government have made it more difficult. Many small businesses preferred the previous award system because it enabled them to bargain on a level playing field with other small business competitors, and much of the work in negotiating terms and conditions was done for them. It is self-evident that individual small business employers do not have the human resource capacities required to bargain in these ways themselves.
Not only has the government taken away the certainty and ease, but through the regulations before us it requires small business to keep time and wage records, making personal record-keeping requirements broader and more onerous. It has been reported that a MYOB survey in December last year found that small and medium business owners were more confused than ever about the industrial relations package. They do not know whether they are in or out and they do not know how the systems have affected their legal obligations to their employees. They were familiar with and happy with the previous system.
The mining association have expressed concern about the reforms and the impact it will have on their industry. One major mining company publicly said that they are concerned the changes could wind back the clock 30 years. As journalist Laura Tingle said a couple of months ago in the Australian Financial Review:
It makes you wonder—whatever your ideological position might be on industrial relations—what the government is thinking will unfold politically from these changes, or whether, in the haze of a long-cherished ideological ambition finally realised, it has thought about it at all.
I agree with Ms Tingle. I think these changes, and those likely to come, are too much based on ideology and have not had enough regard to the economic and social aspects. In that respect, they are irresponsible.
When I hear the government ask: ‘Why would we risk power? Why would we risk our seats? Why would we risk our government on a reform which is going to put the back of the Australian people up?’ I sometimes think that we forget that this is a radical government. It is not a conservative government; it is a radical government. It wants to change the Australian economy and society radically. And to do so, it is prepared to take very significant risks with those things that we know have underpinned our society for decades, for generations—those things which have ensured a fair go and fair dealings between employers and employees, backed by a working, flexible and maturing system of workplace law and regulation.
I am not pretending for a moment—and no-one who has been in my situation for the last decade could—that the previous system was perfect. I am not pretending for a moment that it did not need reform and further change. But what I have seen is such a holistic, radical change that I can only think that those who have driven it are prepared to sacrifice the government to try and secure a change which they hope will be permanent and from which the country can never resile. I do not know if that will be the result of it all. The other point that is very clear to me is that many, many Australians who will be affected by the Work Choice regulations and laws will only feel those effects after the next election. That really does need to be understood by many people. Of the agreements that are extant and operating now, many of them will only end after the next election, so those people will not be affected by these laws at present.
As I have said many times in the many debates we have had on this matter, unless an economy is genuinely in dire straits and unless a society is genuinely in dire straits, and both need radical surgery, risky economic and social change like this is dangerous. It is not more important than social cohesion and a fair progressive society. As a migrant, I came to Australia because of its reputation for fairness and for looking out for the everyman and the everywoman in our society. I am disturbed by legislation and regulations like these because I feel that they attack things which go right to the heart of society as it has been for many decades. And those were hard-won gains that people enjoyed: fair, First World wages and conditions that allowed Australia to grow to be competitive, to be wealthy and to become a country of note in the world. Now they have been overturned.
It is absolute nonsense to say that the latest employment figures or the latest economic figures have anything to do with this legislation at all. It is absolute nonsense to think that law which came into place at the end of March has already had an effect on the national indices that we measure. I think we are yet to see the true effects of this legislation, and we are certainly in the early days of it. The great failure of the federal government is that even to this very day, in my view, it has failed to provide any empirical persuasive economic case for these changes. If my memory is correct—and I hope I get the number of pages right—the total economic case that the Treasury advised us that they put forward to support these changes was four pages long. It is just assumed that this is good for the economy.
I am an economist, and hopefully I have a reasonable understanding of it. It is perfectly true that if you take away people’s wages and conditions, alter them completely and their wages fall, profits will grow because you will get a straight shift into the hands of others. It may be true that an additional worker may be employed on occasions because there is now more money to do that. But the whole purpose of a civilised, First World democracy is not to race people down to the bottom. It is not to compete with the poorest or the least advanced nations. It is to maximise their wages and conditions.
I urge anyone who thinks that that is false economics to look at how wonderful the economies of Scandinavia are. They are built on exactly that proposition. They are high-wage, high-skill, highly competitive, globalised countries. The government’s economic argument is faith based and boils down to this: lower wages, far fewer conditions and more power to employers will equal more jobs. I am not convinced and I do not think the country will be convinced, but we will see.
I also rise to support the motion to disallow these regulations which underpin the Work Choices legislation which Labor vehemently opposes. It is indeed evil and pernicious legislation that will wreck the lives of millions of Australian families. It is the government’s blind ideology systematically destroying the rights and working conditions that generations of Australians have worked and fought for. It is un-Australian and it removes justice and fairness from the workplace.
Senator Murray was dead right in his contribution when he indicated that we have not seen the full effect of this legislation as yet. It will be something that develops over time, but we can certainly see the indicators now. And throughout the Work Choices inquiry we were able to point to examples where similar legislation has in fact been put in place—certainly in Victoria and Western Australia—and we actually saw the race to the bottom happen. We actually saw that—it was presented to the committee in evidence—so it is no surprise to us that already the indicators, only a number of months after the legislation came into force, show that the wages and conditions of working Australians are being stripped away.
Again, Senator Murray was right—we are talking about thousands of workers at this point in time, but we will see hundreds of thousands and millions of workers lose wages and conditions because of this ideological, extreme legislation which this government is putting in place. Labor said during the debate on the Work Choices legislation that this legislation and these regulations will lead to a race to the bottom for the Australian worker. These laws will slowly and insidiously eat away at the family lives and aspirations of millions of Australian workers.
We were not the only ones to say so. The Democrats said so—in fact all parties, apart from the government parties, said so in this chamber. One hundred and fifty-one leading academics in the field of workplace relations also said so. In fact, during the Work Choices inquiry not a single person or organisation apart from employers and employer associations supported this legislation—no-one else. Every other submission opposed the legislation and told us that this will lead to an imbalance in the power relationship in the workplace that will tip that balance, those scales, so far to the power of employers that workers will have no choice but to accept what is put in front to them, or simply not have the opportunity to take a job.
It was not only 151 academics and the Labor Party and the minor parties in this place that said these things—these points were also made by the President of the Australian Industrial Relations Commission Mr Geoffrey Guidice. I probably need to put on record for the Senate that he is in fact an appointee of this government. When speaking at the AMMA national conference on 16 March, Justice Guidice said that the new Fair Pay Commission would undoubtedly slow the rate of growth of minimum wages and that, combined with other income-cutting elements of the new Work Choices, would lead to pressure to cut welfare payments so that incentives to work were not reduced as the rate of wage growth subsided. To quote Justice Guidice specifically, he said:
I think one of the most important issues involved with Work Choices is the reduction of the safety net for the purpose of the no disadvantage test for collective and individual agreements.
That could have a significant effect on incomes of the lowest paid in our community.
I can assure you it’s going to affect our society.
People with low skill levels, low bargaining power, are heading for the Fair Pay and Conditions Standard, which will have an effect on their incomes.
This will be accompanied by a slowdown in the rate of growth of minimum wages—that’s what the Fair Pay Commission is for.
Debate interrupted.
Order! It being 6.50 pm, the Senate will proceed to the consideration of government documents.
I move:
That the Senate take note of the document.
This is the report for the period from 1 November last year to the end of February this year of the conduct of the Refugee Review Tribunal and reviews that they did not manage to complete within 90 days. It is a very apt time to be considering this report, because, as we have heard in this place particularly in question time over the last couple of days but also in wider public debate, there is legislation before the parliament which seeks to enable the government to send a wider range of asylum seekers outside of the rule of Australian law and outside the reach and the review of the Refugee Review Tribunal completely. It makes a mockery of reports such as this.
This report is a direct consequence of amendments made to the Migration Act by this parliament as a consequence of changes announced by the government towards the middle of last year to improve the time for processing and review of people claiming asylum in Australia. That followed a lot of political pressure, particularly from Liberal backbenchers, most notably Mr Georgiou but also others. As Mr Georgiou would acknowledge, that pressure was the culmination of a wider range of public pressure over a long period of time which was sufficient for the government and the Prime Minister to acknowledge that they needed to make some changes that at least made some effort to improve the processing time of asylum claims.
As with the next report, which deals with protection visa processing by the department itself, both the Refugee Review Tribunal and the department are required to assess claims and appeals within 90 days and provide a report to the parliament indicating those cases that have not met that requirement and state the reasons why. It is not a sufficient requirement, as I said at the time, but it is still an improvement. It is certainly an accountability improvement. It is a regular reminder of the need to keep a focus on this area and keep a spotlight on the performance of the department and the tribunal. It is also a particularly strong reminder at this point in time of how massive a backward step it is for this government to now seek to totally subvert the intent of the parliament and the commitments the government made in the middle of last year by deliberately and knowingly attempting to add a new group of people to those who can be removed from Australia and put outside the reach of Australian law, outside the provisions of the Migration Act, including those under section 440A that lead to this report, and outside the scope of any mechanism for public or independent scrutiny, let alone review.
This report details the performance of the RRT and it provides some useful information that I think will enable those who follow this in detail to measure performance, particularly over a period of time, to see whether we continue to improve the trends and the assessment times, to look at the reasons why some of them go beyond the 90-day period and to seek to remedy that wherever possible. It is a useful mechanism. It is not sufficient, but it is useful—but the government are attempting to toss that usefulness out of the window with their latest piece of legislation.
I know there is a lot of focus and pressure at the moment about whether or not that current piece of legislation will be passed. It is no secret that I hope it is not passed, but I hope that senators and the wider community remember that that legislation does not actually introduce a brand new power. It expands the group of people who will be caught under a provision that already exists in the Migration Act and sent outside the rule and reach of law in Australia.
As we all know, many people have already been taken from Australian territory to Nauru and kept there for many years. I remind senators that there are still two people there who have had no independent review of the reason why they have been refused eligibility for a visa in Australia. They have been there for 4½ years and, for all they know, they may be there for another 4½ years. There are still people who can be caught under that provision. If people recognise that this new piece of legislation should be rejected, to be consistent we should be seeking to reverse the provisions that are already in the Migration Act that allow this travesty to happen. I seek leave to continue my remarks. (Time expired)
Leave granted; debate adjourned.
The following government document was considered:
Northern Territory Fisheries Joint Authority—Report for 2004-05. Motion to take note of document moved by Senator Siewert. Debate adjourned till Thursday at general business, Senator Siewert in continuation.
The following orders of the day relating to government documents were considered:
Migration Act 1958Section 91Y—Protection visa processing taking more than 90 days—Report for the period 1 November 2005 to 28 February 2006. Motion to take note of document moved by Senator Bartlett and agreed to.
Australian Livestock Export Corporation Limited (LiveCorp)—Report for 2004-05. Motion to take note of document moved by Senator Bartlett. Debate adjourned till the next day of sitting, Senator Bartlett in continuation.
Interactive Gambling Act 2001Report for 2005 on the operation of the prohibition on interactive gambling advertisements. Motion to take note of document moved by Senator Bartlett. Debate adjourned till the next day of sitting, Senator Bartlett in continuation.
Superannuation (Government Co-contribution for Low Income Earners) Act 2003Quarterly report on the Government co-contribution scheme for the period 1 January to 31 March 2006. Motion to take note of document moved by Senator Bartlett. Debate adjourned till the next day of sitting, Senator Bartlett in continuation.
Local Government (Financial Assistance) Act 1995Report for 2004-05 on the operation of the Act. Motion to take note of document moved by Senator Bartlett. Debate adjourned till the next day of sitting, Senator Bartlett in continuation.
Roads to Recovery Act 2000Roads to recovery programme—Report for 2004-05 on the operation of the Act. Motion to take note of document moved by Senator Bartlett. Debate adjourned till the next day of sitting, Senator Bartlett in continuation.
General business orders of the day nos 86 to 90 and 94 to 98 relating to government documents were called on but no motions were moved.
Order! There being no further consideration of government documents, I propose the question:
That the Senate do now adjourn.
I rise tonight to draw attention to the alarming downturn in mineral exploration in Australia and particularly in Queensland. It has often been said that Australia’s wealth grew from the sheep’s back. That is true, but it is also true that since early colonial times our mineral resources have also contributed to the wealth of this nation. The sheep has been shorn, as it were, but fortunately mining continues—at least for the moment. We have indeed been a lucky country. Since the gold rushes of the 1850s, Australia has prospered from the country’s varied and vast mineral deposits. In the last 20 years, the minerals industry has contributed something in the vicinity of $500 billion to our wealth. Today, Australia is benefiting from a robust minerals industry and mining, representing eight per cent of GDP. No wonder the standard of living in Australia ranks among the world’s highest.
That is not all. Mining has also played a key role in the development of regional prosperity. Since 1967, an estimated 26 towns, 12 ports, 25 airfields and more than 2,000 kilometres of railway line owe their creation and continued existence to mining. If I may be parochial for a moment, much of Queensland’s pre-eminence as Australia’s leading export state comes from its mineral wealth. Cities such as Mount Isa, Charters Towers and Cairns were all initially established as mining centres or mining support centres. Queensland’s mining sector today is worth more than $16 billion per annum—more than twice the value in the 1990s. About 95,000 Queenslanders owe their livelihoods to the mining industry. It is the biggest employer in regional Queensland. It contributes around $965 million in royalties to the Queensland Treasury. Without this income stream, Queensland’s Labor government’s fiscal incompetence would be more fully exposed than it is.
These figures underscore the fact that we have a substantial resources base—the third largest in the world after the United States and South Africa. We have the world’s largest reserves in zinc, lead, nickel and uranium, and Australia is in the top six for gold and copper. Queensland’s north-west is ranked as one of Australia’s most prospective exploration provinces. It has 28 per cent of known lead and zinc deposits—the richest in the world—five per cent of the world’s silver and 1.5 per cent of the world’s copper. Weipa, in the north of the state, has the world’s largest bauxite resource.
However, Queenslanders—and indeed all Australians—should not be complacent about this treasure chest. The mining industry is in danger of catastrophic decline. In the last financial year, just over $1 billion was spent on exploration. That is 25 per cent less than in 1996. In real terms, exploration expenditure throughout Australia is at its lowest level in almost 30 years.
These statistics reflect a very substantial downturn in activity. Mining companies are not fully exploiting Australia’s immense potential reserves. This country is underexplored. There have not been enough significant mine discoveries in the last six years, and there is a danger that the Olympic Dam mine in South Australia will be the only metallic mine in Australia by 2030. That is barely 24 years away. Currently, we are living off the capital of mines discovered many years ago. Even if a substantial deposit were to be found in the next few years, it would take up to 15 years for that mine to become operational. In the meantime, Australia’s share of investment in global exploration—12.6 per cent—is at a 20-year low and is down 30 per cent on the historical average. Australia has slipped from second to fifth in global mining exploration expenditure.
The unpalatable fact is that we now lag at the back of the exploration queue. Canada dominates the exploration race, but countries such as Chile and Peru in South America attract more attention. Today there are 152 mines in Queensland but, by 2030, only those digging coal and bauxite are likely to remain—unless exploration for base metals and gold is accelerated. No world-class deposit has been discovered in Queensland in 15 years. Only eight small mines have been established since 2000, and these have a life span of only about 15 years.
I have spoken before in this place about the vast resources of uranium in Queensland, which have so far, sadly, gone unexploited. The simple reality is that we need a great deal more investment to rekindle the minerals exploration sector. In 2003, the Prosser report found three major impediments to the exploration industry. First, the globalisation of the minerals industry has resulted in countries other than Australia being preferred for mining development. Second, regulatory constraints imposed by native title, cultural heritage, environmental and operational requirements add to costs and are disincentives. Third, exploration is usually left to the smaller or junior mining companies that have limited investment resources. I think it is also useful to add that the obvious resources, in accessible places, may well have been discovered, but it is the little-known areas in risky places which remain to be explored. The major mining companies, however, seem to be reluctant to spend millions of dollars on risky areas. Junior mining companies find it difficult to access capital from investors seeking higher, less risky returns for their capital.
There is an irony in our current situation. In general, the mining industry is enjoying buoyant times. It is experiencing a significant worldwide boom, and prices for mineral commodities are at 20-year highs. It is true that there is some global exploration expenditure, but Australia is attracting too few of those exploration dollars. Instead, mining companies in Australia have been relying on brownfield exploration to meet the demand of the resources boom rather than taking advantage of high commodity prices to explore more widely afield. This lacks foresight. It will not sustain us into the future.
We need to encourage mining companies to look outside the brown circle and search for sizeable exploitable deposits known to exist in the green zones. The challenge—and it is not a challenge just for Queensland but for the whole country—is to find the next generation of mines by finding new ore bodies that will supplement and replace the finite reserves of existing mines.
Australia’s position as a supplier is not under threat in the short term at least, but in the longer term the situation is more worrying. We have the opportunity to ensure Australia’s prosperity by providing incentives to go out and discover new deposits. I believe that part of the answer is to look anew at the introduction of flow-through shares schemes as an incentive. It is a simple equation: mining companies raise capital for exploration by passing on their tax deductions to the individual investors. It has proved to be of immense value to Canada, which now attracts 19 per cent of the world’s exploration capital. To obviate the challenges, Ottawa legislated a new scheme which will continue until 2007.
Flow-through shares make it easier for junior mining companies to access much-needed capital for exploration. In Australia, governments should also encourage mining companies to invest in the higher-risk greenfield exploration by providing high-quality geoscience information.
It is always something of a challenge to return to an activity which has been important in the past but which has been neglected, but the potential advantage of doing so here is clear. There is a huge danger that the cost of not doing so in these circumstances will be surely felt by every Australian. This is a tragedy that we need to avert. (Time expired)
I rise this evening to address the problems surrounding the current refit of four FFGs, down from six. These Adelaide class frigates are the backbone of our Navy. Their refit should have been straightforward, making them the most capable in their class in the world. But just one of the original six frigates has received its refit, and it still does not meet its full capability. This, we are told, will not happen until later on this year. It seems the Minister for Defence is incapable of getting a major procurement project correct at the outset. We are still waiting for the refit of the other three frigates, and of that original project of six, as we know, two have been scrapped.
These frigates are meant to aid Australia’s presence in key operational areas. But a fortnight ago at Senate estimates we were advised that the frigates have failed weapons and software systems and they cannot protect themselves. This is because, firstly, the frigates’ underwater sonar system does not meet all test requirements and their electronic support measures are not fully developed. Finally, their combat management system does not meet all contract requirements.
In spite of all this, the project contractor, ADI, has been paid most of the $1.4 billion contract price. Effectively, the government has paid something for nothing. After nearly six years, it has accepted delivery of a refitted frigate that still has no more capacity than when it was put in for the refitting-out job. At estimates, trying to find out how these payments stacked up with the project’s milestones proved nearly impossible. I was told that that information was commercial-in-confidence. There is no public way of measuring whether the down payments on these refits are value for money at all. Defence also conceded capping liquidated damages for the refits at $10 million—and that on a project that has cost $1.4 billion to date!
So once again we have a major Defence procurement project which is running behind schedule by some four years and facing a cost blow-out of nearly half a billion dollars and which leaves our Navy with no increased capability for at least another three years. The numbers obviously do not stack up in this equation. Here is the sum of things: an order for six frigate refits is reduced to four; costs are spiralling, to date by half a billion dollars; and the refit for the first frigate is, to date, some four years late. It is all a far cry from the launch of this project seven years ago. Then, we were told, six of the Navy’s best would be re-fitted at a total cost of $897 million.
As I mentioned earlier, these frigates are said to be the backbone of the Australian Navy. They are multipurpose warships. They are designed to counter threats from the air, sea and underwater. I accept they have to be shipshape, so I agree with the necessity of them being refitted. That is because the frigates’ combat system has hardly changed from its original specs back in the seventies.
I applaud Defence’s decision all those years ago to refit the six frigates with better command and control systems, air surveillance radars capable of picking up fast-moving targets, launching systems for surface-to-air missiles and the latest obstacle avoidance sonar. But that has not happened, for these refits have run aground. Part of the problem is that Defence requested 174 project changes to the refits. By the way, the legal bill for that dithering, that constant change, has cost an extra $348,000 to date excluding GST.
The first frigate was supposed to be HMAS Adelaide. Its upgrade should have been completed some four years ago. The sixth and final frigate should have been ready earlier this year. Instead, three years late, HMAS Sydney was relaunched just a few weeks ago, minus the essential items that will upgrade the ship.
Now we are being told by the government the refits will be finished by 2009. But can we trust this brave new promise? We know Defence admitted back in 2003 to project cost blow-outs to the tune of nearly half a billion dollars. One must wonder how much this latest delay will cost. We know the government originally ordered refits to six frigates. Then it changed its mind, reducing the order to just four refits. We know the government is concerned about value for money, yet refit costs to each frigate have blown out from $253 million to $350 million.
We also know this project has drawn the eye—and the ire—of the Auditor-General. His report into the frigates’ upgrades said that the project was ‘not proceeding satisfactorily’, Defence executives need to keep a tighter rein on the project and proper process was flouted when it came to more than three-quarters of the contracted payments. What was Defence’s response to this damning report? It saw the report as a ‘good performance benchmark’ against which reforms ‘can be assessed at a later date’.
That later date came at Senate estimates. Judging by Defence’s answers, one could be forgiven for thinking this project was full-steam backwards. The good news, if there is any, is this: finally, after a four-year delay, the first frigate was handed back to the Navy just two months ago. But Defence unfortunately still does not have it right. This must surely shipwreck the government’s reputation as capable project managers. Defence procurement is a complex and demanding business, as we all know. But if the government continues to mismanage this it is going to result in inordinate cost. Let this speech be a warning shot across the government’s bow. If there is another failure in Defence acquisitions, it will not just be the taxpayers left high and dry; it will be the government marooned by its own Defence minister, a minister we know is quick to review but slow to reform.
I would like to talk about an issue that has been in the headlines recently, unfortunately very negatively, and that is Aboriginal and Torres Strait Islander disadvantage. Now that the latest media ‘crisis’ concerning violence and sexual abuse in remote Aboriginal communities has died down, I feel it is appropriate to make some comments about the difficult issues that are facing Aboriginal and Torres Strait Islander communities and to address the underlying causes of the universal disadvantage of Aboriginal Australians and Torres Strait Islanders.
I am aware that there are many on all sides of the chamber who have been actively working on these issues and who share many of the concerns I am about to talk about. Many of us have had mixed feelings about the latest crisis. The allegations and the stories are truly shocking, but everyone working in this area knows that this is nothing new; there has been no sudden change on the ground. Many of us have been trying to draw attention to these problems for a very long time, often with very little success. Perhaps at this stage the only real changes have been that we have a new minister and the willingness of the mainstream media to pay very brief attention to issues that have been largely ignored for decades. Unfortunately they are still not paying attention to the significant underlying issues.
It is tempting to hope that this might signal that, after a decade of erosion and neglect, there might finally be an opportunity to move forward and address the underlying causes of this very significant disadvantage. We must provide to Aboriginal communities the basic services that the rest of us take for granted. Government agencies have always had this responsibility but have consistently failed. ATSIC became the scapegoat, despite only ever delivering one-seventh of the money allocated to Indigenous affairs. The rest of it was delivered by mainstreaming—but those responsible have never been held to account.
There has been a lot of talk about the mainstreaming of Indigenous affairs, but the truth is that mainstream departments have always found it very difficult to deliver services to Aboriginal people. There has often been a mistaken perception that the existence of special so-called top-up programs for Indigenous people excuses them from the responsibility to deliver these services to all Australians. The very programs meant to address this underlying disadvantage and to try to level the playing field have unfortunately resulted in them receiving less than they are entitled to as Australian citizens. At the very same time, certain elements of our community have used this to attack Aboriginal people for receiving so-called special treatment.
We have recently got a new minister who has been making some very strong public statements about problems of violence and sexual abuse in remote Aboriginal communities and promising intervention. Should we be hopeful that this signals a change in government direction? It is hard not to be cynical about the likelihood of any real change, particularly when we have just had a federal budget in which the issues of Aboriginal health and housing have basically been ignored, despite the well-known statistics on life expectancy, which is 17 years less than for non-Aboriginal Australians, and overcrowding—consistently between 15 and 20 people in a small three-bedroom, one-bathroom house—while at the same time the budget handed out huge benefits to the wealthy.
The government has spent billions on tax cuts and continued to hand out tax cuts at this last budget. Despite the rhetoric, Aboriginal services have clearly not been a priority. Perhaps it is a shame that these so-called revelations of abuse did not come slightly before the budget rather than afterwards. The majority of Australians have never been better off. It should be a source of great national shame that, while other first-world nations have moved significantly forward in addressing the rights and living standards of their first peoples, Australia continues to go backwards.
I am worried—and I know that many share my concerns—that there will be a knee-jerk reaction to the latest media so-called crisis, resulting in extreme law and order measures which fail to address the underlying causes and that we do not learn from what has been done before. Meanwhile the issue has faded from the headlines while the poverty and underlying hopelessness have not been addressed and remain untouched. The government has failed to give effect to its much vaunted whole-of-government approach to mainstreaming. There has been no real oversight of service delivery to Aboriginal communities. There is no accountability and little evaluation.
Why weren’t the problems at Wadeye picked up in the COAG trial delivered by the Department of Family and Community Services? What happened to all those millions promised for housing? Why didn’t the minister know what was going on? There were 28 houses destroyed during the ongoing troubles at Wadeye and yet we have been told that there are between 300 and 400 people who are now homeless. What does that say about the housing in Wadeye? Did those 300 or 400 people live in 28 houses? Either those houses were extremely overcrowded or those people did not have housing in the first place. There were ongoing significant problems in this community that the COAG trial has failed to address. The obvious failure of the COAG trial in Wadeye, despite the considerable attentions of senior departmental secretaries and the Department of the Prime Minister and Cabinet, is a clear indictment of the process.
What this shows is that it is truly hard to work across departmental silos and budgets. We understand that. The concept of the new whole-of-government approach, which has been vaunted as the quiet revolution in Indigenous affairs, supposedly depends on the ability of the staff in ICCs, the Indigenous coordination centres, to be able to enter into discussions with remote Aboriginal communities and then enter into shared responsibility agreements, which pool funding and resources from a range of different mainstream agencies to meet community needs—at least that is the story that we have been told. However, what Wadeye and other COAG trials have shown to the secretaries group, which is supposedly coordinating across the government agencies and taking a whole-of-government approach on this, is how truly difficult the whole-of-government coordination program really is, particularly if you are trying to deliver resources that have not previously been strictly identified in the budget.
We also have to ask: with the attention of government so closely focused on Wadeye, how did they fail to recognise and see the recent crisis before it became so obviously evident? Where were the tell-tale signs? Why weren’t they picked up? How is it that the quiet revolution could be based on a trial that is so obviously a failure? The quiet revolution was based on the COAG trials—the COAG trials that have not been evaluated, that are only starting to be evaluated now and that have quite clearly failed. They have had so much government attention, how could we seriously believe the whole-of-government approach could be implemented when it is based on a failed process?
If you look at the recent CAEPR paper, Views from the top of the “quiet revolution”: secretarial perspectives on the new arrangements in Indigenous affairs, you get a clear sense that even with some very senior staff spending a considerable amount of time trying to deliver the whole-of-government approach to services in each of the COAG chosen sites, these very senior people have found it very difficult and time-consuming to negotiate these arrangements. They have had to call on their status, their political acumen and their considerable bureaucratic knowledge and networks to get anything done. What hope do we have putting all our faith in the ICCs being able to deliver a coordinated approach when the ICCs are struggling to find staff? Those staff are usually at more junior levels—and I am not having a go at the staff at ICCs—and are of course finding it extremely difficult to deliver the outcomes that we are trying to get from the whole-of-government approach.
The kind of negotiation that is required is required at a very senior level if we are to make this sort of approach work. It is little wonder that we continue to hear stories of bureaucrats and public servants finding it extremely hard to make this process work. Can you imagine the unlucky person who has been given the job of telling a community, ‘We want you to wash your kids’ faces and clean your houses before we deliver you the basic services to your community’? You could almost believe that they would probably breathe a sigh of relief when the community, understandably outraged, tells them to go away. They would then be unable to deliver their side of the so-called agreement. It must be extremely hard for them to go in and try and negotiate those sorts of so-called agreements. (Time expired)
I have spoken many times in this parliament on the issue of Iraq and on each occasion my conviction grows stronger that Australia is doing the right thing having a presence in Iraq. Australia is doing the right thing for its own long-term security and that of the international community, and for the good of the Middle East. The killing by American forces last week of the al-Qaeda No. 2 and the mastermind of the Iraq insurgency, Abu Masab al-Zarqawi, was a job well done. This butcher was responsible for personally decapitating, on video, foreigners and Iraqis and orchestrating the suicide bombing of innocent Iraqi men, women and children. Further, he had authorised attacks on Iraq and foreign troops. He lived by the sword and accordingly died by the sword. While some argue his death will actually have little effect on the insurgency as other Zarqawis will bob up, the weight of evidence is that the death of al-Zarqawi will be a big blow. Evil masterminds do not grow on trees.
Moreover, it has been reported that, with the tracking and subsequent killing of al-Zarqawi, a treasure-trove of intelligence on his insurgency network has been uncovered with the potential to cripple this network of terrorists. While no-one doubts that the roadside bombs and suicide bombings will continue, on any analysis the insurgency from its peak post the fall of Saddam Hussein to now has been severely culled, and the Iraqi and coalition security forces now have the upper hand. It is important, indeed essential, to note this progress has been underlined by the support of the people of Iraq and their conviction and thirst for democracy.
Just as the West after the twin tower terrorist attack was plunged into an ideological struggle of defending its way of life against an ideological enemy in fundamentalist Islam, so too have the people of Iraq been plunged into an ideological war. The choice for them is the ideology of freedom through democracy versus the dim ideology of the terrorists. Here too the terrorists are losing as each democratic stake is placed in the ground. It was after all al-Zarqawi, the al-Qaeda leader in Iraq, who said some two years ago, ‘Democracy is coming, and this would mean suffocation for al-Qaeda,’ and he added, ‘Time is not on our side.’ It has been in this time of democratic transition that the insurgents have most frantically tried to whip up a civil war between Sunnis and Shiites to head off the path to democracy. But no fear, no threat and no bloodshed has halted the people of Iraq’s desire. The strides forward since the fall of the merciless dictator Saddam Hussein, though set in great tragedy, have been enormous, inspiring and conclusive.
To be reflective, Australia ought to count its historical blessings as one of the very few countries where democracy was created without war and bloodshed. In just 12 months, look how far the Iraqis have come. In January 2005, 8.5 million Iraqis under the serious threat of violence came out to vote for an interim government. Ten months later, 10 million took part in a vote on the referendum and, at the end of the year, 12 million, or some 75 per cent, of the eligible voters elected their first national assembly. In 12 months, there have been three elections, each one bigger than the one before. There can be no doubt of the Iraqi people’s rejection of the insurgents’ mad ideology. They want to win over the terrorists.
The consequences of establishing a free and democratic Iraq will be historic. Firstly, as Tony Blair has said:
… global terrorism is so anxious to stop us in Iraq and Afghanistan—because if they succeed in that then they stop the possibility of democracy taking the place of religious fanaticism in these countries.
Whereas if we succeed and if democracy takes root in Iraq and Afghanistan then I think, after that, global terrorism is on a downward path ...
Secondly, a consequence of a democratic Iraq will have profound strategic undercurrents in the Middle East. It will stand as a beacon of freedom in the Arab world for countries ruled by oppressors and dictators. In many ways, it has already started to affect the Arab world with people power expelling the Syrians from Lebanon last year and the rejection of terror and weapons of mass destruction in Libya and that country’s return to international acceptance. If history is any guide, a democratic Iraq will have a cascading effect throughout the Arab world.
Thirdly, a democratic Iraq—the new Iraq as distinct from the old Iraq—will not attack its neighbours or conspire with terrorists. It is likely to act as a buffer against the agents and protectors of terror like Iran. There is a great deal at stake for the people of Iraq and the Western world and its values—values Australia shares. Yet critics within our own country would have us believe in the moral equivalence of the insurgents—that they are freedom fighters indeed. These critics are more blinded by their ingrained hate for America and its superpower status. No dose of truth or reality cures them of their delusion. Neither suicide bombing of women and children nor al-Zarqawi’s personal beheadings of Iraqis and foreigners cures them of their delusion. They simply say that it is the coalition’s fault for being in Iraq, having preferred to strap the Iraqi people with a merciless dictatorship than to give them a chance at democracy.
I have heard the speeches in this place, this very parliament, blaming the civilian deaths upon the coalition forces, and yet silence on the continuing brutality of the insurgents. From the same people I have not heard acknowledgment of the people of Iraq’s wish for democracy or the success of the elections. They do not care about it. They would prefer to chant the mantra about the coalition’s mistake. These people are easily recognisable. They are from the same Left that supported throughout the Cold War years the moral equivalence of the Communist regimes. Even with the evidence of the Stalin years, the scales did not fall from their eyes. How can we expect that, in the face of the evidence before them in Iraq, the scales will fall from their eyes?
In conclusion: I believe Iraq will endure and history will show it as a seminal point in world affairs. To quote Tony Blair again:
We will not defeat this terror until we face up to the fact that its roots are deep and that it is not a passing spasm of anger but a global ideology at war with us and our way of life. Their case is that democracy is a Western concept we are forcing on an unwilling culture of Islam.
That is the ideological war we are up against, and I believe we will endure.
The following government documents were tabled:
Australian Research Council—Strategic plan 2006-08.
Dairy Produce Act 1986Funding contract with Dairy Australia Limited—Report for 2004-05.
Northern Territory Fisheries Joint Authority—Report for 2004-05.
Public Sector Superannuation Scheme (PSS) and the Commonwealth Superannuation Scheme (CSS)—Report on the long term cost of the Public Sector Superannuation Scheme and the Commonwealth Superannuation Scheme prepared by Mercer Human Resource Consulting Pty Limited using data as at 30 June 2005.
The following documents were tabled by the Clerk:
[Legislative instruments are identified by a Federal Register of Legislative Instruments (FRLI) number]
Australian Capital Territory (Planning and Land Management) Act—National Capital Plan—Amendment 52—Zoo Expansion (Part Block 1502 Belconnen) [F2006L01820]*.
Australian Capital Territory (Self-Government) Act—Disallowance of the Civil Unions Act 2006 (ACT) [F2006L01810]*.
Australian National University Act—
Fees Statute 2006—Fees Rules 2006 [F2006L01771]*.
Liquor Statute 2006 [F2006L01776]*.
Civil Aviation Act—Civil Aviation Safety Regulations—Airworthiness Directives—Part 107—AD/PARA/16 Amdt 1—Techno 240-B Reserve Parachute [F2006L01801]*.
Class Rulings CR 2006/47-CR 2006/50.
Defence Act—Determinations under section 58B—Defence Determinations—
2006/23—Deployment allowance—Timor-Leste.
2006/24—Compassionate travel—amendment.
2006/25—Member with dependants (separated)—amendment.
2006/26—Uniform allowance.
2006/27—Removals, travel and meals—amendment.
Financial Management and Accountability Act—Financial Management and Accountability Determinations—
2006/13—Energy Special Account Variation 2006 [F2006L01818]*.
2006/15—Administered Payments and Receipts for Other Entities—Australian Trade Commission Special Account Establishment 2006 [F2006L01824]*
2006/16—Other Trust Moneys—Australian Trade Commission Special Account Establishment 2006 [F2006L01825]*.
Fisheries Management Act—Southern and Eastern Scalefish and Shark Fishery (Specified Non-Quota Species) Temporary Order 2006 [F2006L01794]*.
Motor Vehicle Standards Act—
Vehicle Standard (Australian Design Rule 10/01—Steering Column) 2006 [F2006L01783]*.
Vehicle Standard (Australian Design Rule 23/01—Passenger Car Tyres) 2006 [F2006L01788]*.
Vehicle Standard (Australian Design Rule 33/00—Brake Systems for Motorcyles and Mopeds) 2006 [F2006L01787]*.
Product Rulings PR 2006/103-PR 2006/108.
Taxation Determination 2006/19.
Taxation Rulings—Old Series—Notices of Withdrawal—IT 336, IT 337, IT 2044, IT 2045, IT 2094, IT 2114, IT 2279, IT 2284, IT 2306 and IT 2431.
* Explanatory statement tabled with legislative instrument.