Senator O'BRIEN (5:06 PM) —At the outset I respond to a couple of comments that have been made in this debate and in particular to comments made by Senator Bartlett, responding to Senator Cook's comment at the commencement of this debate. Those comments revealed the gambit that the Australian Democrats were playing in relation to the packages of legislation that have been before this chamber over the last five days. We recall that the Democrats were party to and supportive of a guillotine on the Environment Protection and Biodiversity Conservation Bill, various GST bills and now these bills. We note that they were vehement in their claims that they did not support a guillotine on the GST bills and I did not understand them to be strongly supporting the guillotine which is currently in place.

Senator Brown —Mr Acting Deputy President, there are only two government members and no Democrats in the chamber to hear Senator O'Brien's delivery. I draw your attention to the state of the house. (Quorum formed)

Senator O'BRIEN —I thank government members for restoring the quorum. Senator Brown obviously has not achieved his effect because he did not obtain the attendance of any of the Democrats to further this debate, although I am sure that the Democrats will be keen to participate in it. After all, they have given effect to the guillotine which has required the completion of this debate as well as previous debates.

Senators will recall that the requirement under the previous guillotine on the Environment Protection and Biodiversity Conservation Bill was that we complete debate and deal with a bill which was the subject of 511 government amendments, a significant number of Democrat amendments, a significant number of minor amendments and over 300 opposition amendments. That bill was amended by the passage of all 511 of the government amendments, with the support of the Democrats. The insistence of the Democrats was that that bill be out of the way and dealt with within one day. Similarly, there was a curtailment of the debate on the GST bills. They were dealt with and were out of the way by last night, with the exception of these two bills which were introduced into the House of Representatives only last week and for which we have five hours for debate.

In what I took to be an apparent challenge to the ALP, Senator Bartlett said, `Let us see what the ALP's credentials are on the environment when we deal with the RFA legislation.' That is the Democrats' planned get-out with the environment movement in relation to their actions on the previous bills. They have significantly offended the major environmental groups in this country with their support of the government amended environment protection and biodiversity bills—I stress that there were 511 amendments—without adequate consultation with the major environment groups in this country. Now they are supporting, as well as the GST bills in general, the bills before the chamber which have a significant environmental impact.

But what are the Democrats going to do in the next session of parliament? They are going to say that they are supporting the environment because they will not support the RFA legislation, or at least that is my interpretation. In other words, their get-out is to say, `Our environment credentials are intact because we have not supported the RFA legislation.' They know they are secure in that regard because the opposition has announced that we will be moving amendments to the bill, but we will be supporting the legislation and seeking to make it better.

The cat has been belled. The Democrats are going to use the RFA legislation as their shield against the views of the significant environment movement in this country—not the World Wide Fund for Nature or Humane Society International. I do not mean to say that they are not organisations of some significance but, considered against the Australian Conservation Foundation, Greenpeace or even the Wilderness Society, they are not organisations with an environment public profile of the same stature in this country. The Democrats are going to seek to rebuild their environment credentials on a piece of legislation which, in fact, has more to do with the issue of forestry, including the protection of significant parts of the Australian natural forest, as well as a plan to provide for sustainable forestry operations in part of the Australian natural forest.

In dealing with this particular legislation, we have to take a look at the government, and I want to focus on a part of the coalition government in this aspect of my presentation. What we see here is another case of the National Party being dudded yet again. Senator Cook dealt in part with this matter earlier today when he pointed out that not only the Leader of the National Party, Mr Tim Fischer, but also the Deputy Leader, Mr John Anderson, promised that, if the originally promised $3½ billion in reduced fuel costs did not eventuate in the total tax package, they would resign. They held out to the National Party constituency in rural and regional Australia that they were going to be hairy chested, that they were going to stand up for their constituency, that they had a commitment to $3½ billion in reduced fuel costs and that if they did not get it they were going to resign.

Senator Boswell was here earlier and I was expecting him to stand up and justify the National Party's position in relation to that matter. His leader and his deputy leader in the other place, and indeed the leaders of his parliamentary party generally, had made a commitment to their constituency that they would walk out of the coalition if they did not get the promised $3½ billion in reduced fuel costs. The fact that they have fallen $2 billion per annum short of fulfilling that commitment did not warrant one line in Senator Boswell's speech.

I suppose you come to accept that when you look at the recent history of the National Party. We had a National Party minister, Mr Anderson, who went to cabinet with a proposal on the wool stockpile and was overrun by the Liberal Party members of cabinet. He walked away—he did not resign—humiliated within the cabinet and within his constituency. He walked away and copped it. The National Party said nothing and then fell back to the second line of trenches, defended the freeze of the stockpile and said, `It's time to move on.' You have to see what the National Party are about in this. They will cop whatever this government tells them to cop. When they are told to jump, they will simply say, `How high?' No matter how hairy chested they are in their constituency in rural and regional Australia—perhaps I should say their putative constituency—they will, when it comes down to tintacks, cop what is dished out to them. Whatever scraps are laid on the table, the National Party will take them, because at the end of the day it is obviously more important to hold those spots at the cabinet table and to remain in the coalition than to stand up for what you promised and for what you are supposedly committed to.

I was not surprised that Senator Boswell did not take Mr Anderson to task publicly. After all, he is looking at the future leadership of the National Party, not in his own right—I would not want to say something that would subject my speech to ridicule—but in terms of the future contest which is likely to emerge between Mr Anderson and Mr Vaile. Notwithstanding Mr Fischer's comments about his proposed longevity in the position, there has been a lot of media speculation about him leaving the bush and leaving the leadership of the National Party. The question of who would fill it is a matter of great discussion within the National Party. When Mr Anderson makes a promise on this legislation which he does not keep then I suppose it is only natural that Senator Boswell, who is backing his future candidacy, would not take him to task publicly on the breaking of that promise.

Notwithstanding anything that Senator Boswell has said, perhaps he ought to go back and look at the promises that were made to rural and regional Australia and look at the outcome of the package—the agreement between Mr Howard and Mr Costello on the one hand and Senator Lees and the Democrats on the other—because it is pretty clear that, in the final analysis, the National Party did not get a look-in on the outcome.

There has been some comment and debate about the issue of Euro 2, about the National Road Transport Commission's support of the current package and about the advancement of meeting Euro 3 in 2002-03 rather than meeting Euro 2. I have seen a table of the changes which were proposed in relation to diesel vehicles under the original National Road Transport Commission's findings prior to the government-Democrat deal. As I understand the package, it was proposed that, for all vehicles except medium and heavy goods vehicles—that is, trucks—Euro 2 would be achieved in 2002-03. The proposal for medium and heavy trucks was Euro 3 or US98. I understand it is proposed that all vehicles will go to the Euro 4 standard in 2006-07.

I was more interested in the comments in the letter dated 4 June which Mr Hicks, the Chairman of the National Road Transport Commission, sent to Mr John Anderson, the Minister for Transport and Regional Services. A passage from that letter reads:

I note that the environmental proposals outlined in the Tax Package will accelerate the availability of low sulphur fuel, and as a consequence provide for the acceleration of vehicle emission standards . . .

I did have an opportunity to speak to some officers of the national road transport group—the Australian Transport Forum, they designate themselves—in relation to the issue of low sulfur fuel. I was given to understand that at present low sulfur fuel capacity exists in one of the major refineries in this country, and there are others who say that it is possible for them to rather speedily upgrade so that they can very significantly reduce the sulfur content in the diesel fuel which they manufacture. Another of the refineries is saying that it would be a really long-term project for the refinery to be upgraded to provide low sulfur diesel fuel.

The real consequence was suggested to be that there will be significant pressures on Australian refineries to provide low sulfur fuel in any case, because the alternative suppliers would be refineries in Singapore, where there is sufficient capacity, with the large capacity that is available in Singapore, to provide enough low sulfur diesel fuel to meet the entire needs of the Australian economy for diesel fuel, and in a very short time. The consequences of a move to a lower Euro standard, if there were not a movement in the refining capacity for low sulfur diesel fuel, would be the importation of significant amounts of diesel fuel from Singapore or perhaps from other places. I am going on the advice I have been given at this stage by industry representatives.

I really have to wonder what steps have been taken in this hastily cobbled together deal to ensure that we do not end up with the unintended consequence of our needing to import a significant amount of diesel fuel into this country while refinery capacity is attended to. If that is the case, we are going to see a further blow-out in our balance of payments figures. The government when in opposition used to run around the country with what they described as a debt truck. They seem to have parked it in a hangar somewhere, locked the door and thrown away the key, because the debt seems to be getting bigger and bigger. If we are forced to import billions of dollars worth of diesel fuel on top of our existing balance of payments problems, this unintended consequence will in some ways, I suspect, remove the benefits which the government is trumpeting for this part of the package, because the effect of that will no doubt ultimately lead to a rise in interest rates, and there is no doubt that operators in the road transport industry will pay those interest rates on their high cost haulage equipment. That is a minor digression from the discussion on the legislation which is before the chair. In light of the matters that have been put to me, there is a consequence, the details of which I thought were worth sharing with the chamber.

In terms of the compliance costs of this legislation, I must say I was somewhat amused at some of the suggestions that we would be able to monitor by global positioning satellite the movement of trucks for which the reduced diesel fuel excise rate is claimed. I understand there is a proposal for a pilot scheme to operate in my state of Tasmania. I think that has probably got more to do with how you levy registration charges or operating charges against the trucking industry than with monitoring the use of diesel fuel in terms of compliance with this legislation. I wonder what work has been done to assess the costs of installation of equipment and of monitoring and policing by global positioning satellite all of the trucks for which the low rate of diesel fuel excise is claimed. If that is not the case, is there a proposal to set up not roadblocks but some monitoring system at the point where trucks cross the boundary line between the areas in which the lower excise is available and those in which it is not to be used? Is there intended to be some sort of honour system that applies? That would make this system quite ridiculous in terms of assessing what the real cost implication for the economy would be. In total, what we have is a system which in terms of compliance costs and policing is a great unknown. We have five hours to debate this legislation in the chamber—(Time expired)