Mr PRICE(12.26 p.m.) —I am indebted to the Parliamentary Secretary (Cabinet) to the Prime Minister (Mr Miles), and I thank him for his courtesy. Mr Deputy Speaker Mossfield, it gives me some sense of satisfaction that you should have been involved in such an important message from the Speaker about the powers of the House in respect of money bills but, like the member for Werriwa (Mr Latham)—without wishing to reflect on you—it would have been nice if the Speaker was in the chamber for such an important message.

When we are talking about the respective powers of the Senate and the House, I am a little embarrassed that I have perhaps previously considered some of the Senate's powers as too much and, as a government backbench member, very frustrating. In opposition you learn to understand some of the benefits the Senate has in consideration of legislation—its ability to actually extract the detail behind legislation. I would in no way wish to reflect on the powers of the Senate.

However, I do believe the message from the Speaker is a very important one. As both shadow ministers on the opposition side have stated, there is no disagreement on either side of the House on the interpretation of the third paragraph of section 53 of the constitution. It is pleasing that that should be the case. The Senate doesn't have the power to affect the tax burden on ordinary people, yet your message alerts us to the fact that the schedule of amendments made by the Senate has this very direct consequence.

The parliamentary secretary has been very courteous to me—and I am grateful—in allowing me to make a small contribution. Again, I make the point that, if this House is to function and the prerogatives of the House are to be maintained, it is really important that courtesy be extended to the opposition, particularly to the shadow minister, in foreshadowing that this bill would be coming up and the likelihood of the Speaker making such an important statement.

It is unfortunate that on these bills we, as a House, do not have a proper opportunity to address the constitutional issue that you, Mr Deputy Speaker, have placed before us in the statement you read out on behalf of the Speaker. I sincerely hope—this being a sitting Thursday in the last week of a parliamentary sitting—that at some future date the government may consider that the issue is of sufficient importance and gravity for there to be an appropriate parliamentary debate about section 53 of the constitution.

Members on both sides of the House are very concerned at all times to ensure that the constitution is followed. Indeed, the government has a track record of insisting on this, more so than perhaps us.

By way of summary, it is a pity that proper courtesies were not extended to the opposition on this matter and that the Speaker himself was not able to be present in the chamber, given the importance of the Speaker's message that you, Mr Deputy Speaker, read out. Last but not least, I hope there will be a future opportunity where the support of all honourable members about the constitution in this instance can be brought to a head and debated and an appropriate message sent to the Senate. I thank the House.

Mr MILES (Braddon—Parliamentary Secretary (Cabinet) to the Prime Minister) (12.31 p.m.)—in reply—I would just like to sum up this very brief debate which we have had. I understand the comments from one or two people in the opposition on the way in which this matter has been dealt with by the government. First of all, can I make it very clear that we are following exactly the same procedure as the former government followed with us in regard to this matter. So, in getting the forewarning, we are dealing with the Speaker's statement in the same way this matter was dealt with previously.

I suggest to the member for Werriwa (Mr Latham) that, if he wants further information on the legal basis for this, he might refer to the speeches by his current Leader of the Opposition (Mr Beazley) and the then Assistant Treasurer, the former member for Canning, Mr Gear, so that he might be more acquainted with the way in which the previous government dealt with it. I am just saying that this government is following precedent. There is nothing unusual about it. There is quite a bit of fuss being made by the member for Werriwa about this. I just want to put it on the record that we are following the same sort of procedure.

The member for Werriwa also made the comment that the Treasurer (Mr Costello) was not in here and was not having carriage of the matter. Neither is the shadow Treasurer in here taking carriage of it. That is okay. All I am saying is that I have responsibility for carriage of this bill through the House.

In regard to the public interest, I would think that the Australian people out there who have been told that they are going to get some tax cuts would have a great deal of interest in family taxation cuts of $1 billion. There is certainly public interest amongst families right throughout this country looking for a $1 billion cut, looking for $1 billion back in their pockets on 1 January. They know this is coming. The government is honouring its promise to the Australian people within a year of coming into government. They are getting family cuts.

Mr Martin —This is about the sovereignty of the two Houses—the House of Representatives, the sovereign parliament.

Mr MILES —That is okay. The member for Werriwa was saying in regard to the second point of this motion that there was no public demand. Well, there is. I just want to make the point that a lot of Australian families out there are keen to see the tax cuts.

Mr Martin —Never mind the substance. This is about the Senate trying to railroad us again.

Mr MILES —All right, let me come to that in a moment. There is no doubt of the interest out there by families right around this country. Turning to some of the other comments made by one or two members of the opposition, yes, we do agree on the way in which we should handle this with respect to the way in which the Senate is dealing with the constitutional question. It has been pointed out that a report, which is a bipartisan report, has been done. It came down late last year and is being reflected on. Obviously, that bipartisan approach by the House of Representatives Standing Committee on Legal and Constitutional Affairs is a relevant report to this debate. We take that on board. We understand the comments that the Senate is trying to play here with the House of Representatives. No doubt the report will be dealt with as time proceeds.

Mr Melham —In a cross-party way.

Mr MILES —Yes. We would like to put on the record in this discussion that we recognise that bipartisanship which occurred in regard to that report. I would suggest that this motion now be put.

Mr Latham —Mr Deputy Speaker, on a point of order: the parliamentary secretary was claiming that he was closing the debate, but it was in fact his first speech in the debate. I just point out to the government that there are other members who wish to make a contribution on this. Given that the parliamentary secretary has just made his first speech, I would ask the Deputy Speaker to give—

Mr Costello —On a point of order—

Mr Latham —Hang on, he can't interrupt on my point of order. I can finish my point of order.

Mr Costello —This is not a point of order.

Mr Latham —It is a point of order.

Mr DEPUTY SPEAKER (Mr Mossfield) —I will rule when I have heard the honourable member for Werriwa. Have you finished?

Mr Latham —No, I have not.

Mr Costello —I do make a point of order on the point of order: this is not a point of order. The member should resume his seat.

Mr DEPUTY SPEAKER —I will listen to the honourable member for Werriwa. Then I will make a decision on his point of order.

Mr Latham —I was making the simple point that the government had not given the opposition notice of this particular motion. Members had not been aware that the important provisions of 53(3) would be debated before the House. The parliamentary secretary has made his first speech, not his second.

Mr DEPUTY SPEAKER —Order! I have heard the member. I do not believe there is any point of order.

Question resolved in the affirmative.

Senate's amendments—

(1)   Schedule 1, item 2, page 4 (after line 8), after the definition of spouse , insert:

taxable income , in relation to a beneficiary of a trust estate, includes (except in section 20J) any amount that would have been included in the beneficiary's assessable income under section 100 of the Assessment Act if paragraph 100(1)(b), and the words "or of each of the trust estates" in paragraphs 100(1)(c) and (d), of that Act were omitted.

(2)   Schedule 1, item 2, page 13 (after line 11), at the end of section 20J, add:

(2)   For the purpose of determining whether section 20C or 20D applies, or would apart from section 20E apply, to the beneficiary, the beneficiary's taxable income is taken to be the beneficiary's share of the net income of the trust estate in respect of which the trustee is liable to be assessed and to pay tax under section 98 of the Assessment Act.

(3)   Schedule 1, item 2, page 21 (line 26), omit "at the end of", substitute "after".

(4)   Schedule 1, item 2, page 27 (after line 19), after section 20U, insert:

   20V Quotation of spouse's tax file number

(1)   A taxpayer's spouse may tell the taxpayer the spouse's tax file number for the purposes of this Division.

(2)   A taxpayer may, but is not obliged to, quote the spouse's tax file number for the purposes of this Division.

Mr DEPUTY SPEAKER —Is it the wish of the House to consider the amendments together?

Mr Latham —No, it is not the wish of the House to consider them together.

Mr DEPUTY SPEAKER —It is not agreed to consider them together.

Mr MILES (Braddon—Parliamentary Secretary (Cabinet) to the Prime Minister) (12.38 p.m.)—In that case, I move:

That amendment No. 1 be agreed to.

This amendment will include the income of a taxpayer's spouse in the family income where the spouse is under a legal disability and the spouse's only income is a share of income from the trust. The change is necessary to ensure that the FTA income tests work properly. The payment of tax by trustees on behalf of legally disabled beneficiaries should not result in that income being excluded from the FTA income. Normally, a beneficiary in this category should be treated as having no taxable income and the income is taxed in the hands of the trustee. I commend the amendment to the House.