Mr REID —My question is addressed to the Minister for Defence.

Mr Crean —What about the art gallery, Bruce?

Mr SPEAKER —I warn the member for Hotham.

Mr REID —Can the minister advise the House whether there has been any change in the government's attitude towards the privatisation of Australian Defence Industries?

Mr McLACHLAN —I thank the member for Bendigo for his question. He has displayed a close interest in ADI for many years. Like the previous government, we have been watching with interest the performance of Australian Defence Industries and we have noticed, with cautious optimism, that they now appear to be doing well. Indeed, the board has advised the government that its business restructuring has now put it in a position where privatisation could be a viable option. I might say that the coalition had no plans for the privatisation of ADI at the time of the last election. The Prime Minister said as much when he visited Bendigo in February last year, as did the member for Bendigo. At that time, ADI was still in the process of rationalisation of its business operations, which it set in train in 1989.

There is now widespread recognition within the industry of the improved operating performance of the company. Considerable interest has developed and they have done very well. The government is not averse to such a course, as neither was the previous government. No responsible government would categorically rule out for all time the privatisation of a public enterprise like this. Labor didn't nor will we. So we agree and, therefore, it is now clear that the company is successfully transforming itself into a viable commercial entity. Accordingly, we will be looking at the optimum time for its transition into private hands and I imagine that that will be in the next year or so.