Senator COOK —My question is to the Assistant Treasurer, Senator Kemp. Does the government stand by evidence given by the Department of the Treasury to the Senate GST committee in December that exempting food and other essentials from the GST would make the government's tax reforms unsustainable? In particular, does the government support Treasury's analysis that the removal of food and other essentials `would mean that the package is unsustainable as a whole, with likely higher adverse economic effects on the fiscal balance, monetary policy settings, growth and employment'? At the time the Prime Minister and the Treasurer trumpeted these same views. My question is: does the government still support Treasury's analysis?

Senator KEMP (Assistant Treasurer) —To Senator Cook I would say the government will not be supporting any final tax package which is unsustainable. We will not be supporting any package which is not in the interests of the Australian economy and the Australian people. But as to the final shape of that package, you will be aware—and I have said this a couple of times, but I guess I will be saying it a few more times today—that negotiations are under way with non-government parties. As to the final shape of the tax package, you will have to await the announcement of the outcome of those negotiations. But let me absolutely assure you that the government will not be supporting any unsustainable tax package. The government will be supporting a tax package which we believe will be in the interests of the Australian people and the Australian economy.

Senator COOK —Madam President, I ask a supplementary question. I note, Minister, you did not actually answer the question I put, but I ask a supplementary question. Does the government stand by the Treasurer's statement in the House on 30 March of this year when he said:

If you exclude food from the GST, you are going to have tax inspectors running around trying to see whether the chocolate on a gingerbread man is bigger than the eyes, trying to determine whether it is food or a snack.

Will these be the same tax inspectors who will be sticking thermometers into chickens? How many tax inspectors will there be employed to undertake this important job of thermometer insertion and gingerbread eye measurement?

Senator KEMP (Assistant Treasurer) —We heard the joke yesterday. I guess we will hear it today, and we will hear it tomorrow. I guess that this will continue on. But let me make it absolutely clear to you that we are very conscious of the need to develop a tax package which has very effective compliance arrangements. The government will only support a package which—I have said it once, I have said it twice, and I will say it again—is in the interests of the Australian people and the Australian economy.