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Thursday, 10 May 1984
Page: 1913

Senator MAGUIRE(12.24) —I wish to speak on Appropriation Bill (No. 3) 1984-85, Appropriation Bill (No. 4) 1983-84 and the Appropriation ( Parliamentary Departments) Bill (No. 2) 1983-84. These Bills provide appropriations for the running of the government to June, to the end of the financial year. They cover the unexpected items which occur in Budgets, those items for which provision was not originally made in the August 1983 Budget. The total amount of funds to be appropriated by these Bills is in excess of $630m. However, as a result of various savings effected by the Government during the course of the year, the net increase in total outlays as a result of these measures is some $336m. It must be said that much of the increase in the outlays is due to extra wages and salaries costs and higher award wages, in particular, those handed down in October last year. I refer to the 4.3 per cent increase in wages awarded by the Conciliation and Arbitration Commission.

One of the major appropriations in these Bills is that for natural disasters relief. An extra $46m has been appropriated by these Bills to provide for disaster relief, bringing the national total for the financial year to $157m. That money is paid through the Department of Finance. An extra $16m is to be paid to Queensland for drought and flood relief, $16m to Western Australia for a drought which is now emerging in that State and, in respect of my own State of South Australia, $1.2m has been provided. That takes the total amount paid from the Commonwealth Budget for disaster relief in that State to $11.5m. During the meeting of Estimates Committee C, a breakdown of the funds expended by the South Australian Government on disaster relief was provided to me. These now total $6m this financial year in respect of the Ash Wednesday bushfires, $1m in respect of floods in the Barossa Valley area and $4.5m for drought relief. Those amounts are broadly but not exactly paralleled by the amounts provided in the Commonwealth Budget.

One significant item which appears in the estimates for the Department of Primary Industry is the southern bluefin tuna management program. That is a new program which did not appear in the original appropriations. It began in October 1983. The funds are paid through the Budget to reimburse the State governments in respect of their management of this very important national resource around the southern coasts of Australia. Certainly, the southern bluefin tuna management program, which was introduced by the present Government, is of vital importance to a number of centres in my own State, notably, Port Lincoln and Streaky Bay on Eyre Peninsula, where the tuna industry is a major source of livelihood. The amount of money to be paid to South Australia this financial year under the program is $51,000 with $108,000 being paid to Western Australia.

One of the very large elements of the Appropriation Bills is the $59m extra to be appropriated for labour force and training programs. From a total of $59m there are allocations for assistance for work experience, training for Aboriginals and moneys for the adult wage subsidy scheme. Of course, labour force retraining is a key area. That $59m extra allocation needs to be seen in a wider context. For example, yesterday we had before the Senate the national technology strategy discussion draft in which it was proposed that Australia in the future should adopt a target of retraining one per cent of its labour force annually. According to the discussion draft that should be a national priority. On my calculation that suggests some 60,000 Australians would need to be retrained every year to effect that one per cent priority. As I indicated yesterday, on my calculations that suggests that more than the entire work force of Geelong in Victoria would need to be retrained each year to achieve that target. But I believe it is achievable. A one per cent retraining level has been the practice in countries such as Sweden for a number of years. I am sure it is something that can be managed in Australia.

I believe that one of the interesting items in the Budget is the variation by a number of departments of the allocation for fares for travel and travelling allowances. For example, the cost of fares alone in respect of the Department of Finance increased by some $34,000 to a figure of over $300,000. Fares in the Department of Primary Industry increased by $56,000 to well over a quarter of a million dollars. In the Bureau of Statistics over $600,000 was spent on fares. In a tally of just four departments I discovered that over $1.4m was expended in respect of fares alone.

I must say that, with such large payments involved, I wonder whether any thought has really been given by the Commonwealth Government and the Commonwealth Public Service to the question of whether there is any scope to utilise advance purchase air fares in some circumstances. I emphasise 'in some circumstances'. I acknowledge that there are restrictions, certainly faced by the ordinary consumer, in using advance purchase air fares. But I imagine that, with so many people in the Commonwealth Public Service travelling each year, many of these people must have knowledge of their travel arrangements, travel dates and times well in advance-for example, people attending conferences and seminars. It seems to me that it could be very cost-effective for a study to be conducted on the feasibility of using advance purchase air fares in some circumstances. I believe certainly an inquiry into that subject at a departmental level in the Department of Finance could be very beneficial.

In these Appropriation Bills large amounts are also provided for travelling allowance. For example, the aggregate amount for the Department of Primary Industry, the Australian Bureau of Statistics, the Department of Resources and Energy and the Department of Finance for travelling allowance alone came to $1. 1m. It is not clear from the information supplied how much of that travelling allowance is in respect of travel to and from Canberra but it certainly raises some interesting questions. For example, it seems to me that with somewhat better air schedules to and from the national capital there might be some scope for reducing travelling allowance payments. I would have thought that the Commonwealth Government, being a major consumer of air travel, would have some abililty to talk to the airlines about their schedules to the national capital. For example, the schedules as they have operated until recently meant that many working days in Canberra were artificially shortened. As a result of these schedules people arrive relatively late to the capital and depart early from the capital on the airlines. Some improvement in the airline schedules to and from Canberra could assist the Budget in cutting down travelling allowance. Officers from capital cities other than Canberra have very short working days when they get to Canberra and are often forced into staying overnight resulting in the payment of travelling allowance.

The estimates for the Bureau of Statistics provide $600,000 for extra positions to boost work on the Bureau's register of business. That will enable the Bureau to carry out a wider range of surveys of business activity in Australia and I think all senators will welcome the availability of much more reliable information on business activity.

One very interesting item in the Appropriation Bills was overtime in respect of the Department of the Treasury which has increased by $14,000 above the Budget allocation. It was revealed to Estimates Committee C that this financial year the Department of the Treasury has had a 60 per cent lift in the number of ministerial letters over the previous financial year. In the Estimates Committee I was able to discover that before 1983-84 the Treasury dealt with 14,000 to 16, 000 ministerial letters a year. Since the change of Government in May and June last year, for example, 2,000 letters were dealt with in each month-a very interesting phenomenon. Perhaps many constituents who raised matters in the past but had made no progress decided to dust off their old proposals and bring them out last year with the change of government. It is not clear what the reasons were but it has certainly resulted in an increase in overtime in the Department of the Treasury.

Now that the signs of upturn in the economy are consolidating there seems to be less pressure on Treasury officers and, I imagine, less pressure through the Department for extra funds in the Budget. It is very illuminating to look at some of the economic indicators that are now available to us as a sign of improving economic conditions in the country. For example, a few minutes ago the Bureau of Statistics released the latest labour force information for the month of April. I am pleased to say that that shows that in the 12 months since April last year 224,000 extra jobs were created in Australia. I stress that they are extra jobs and that 224,000 extra people are now working than were working in April 1983. Of course, honourable senators will be aware that that figure of 224 ,000 is well above the estimate made in the August Budget last year for employment growth in the national economy. In the 12 months to March-I do not have the growth rate to April-there was a 3 per cent increase in the number of people employed in Australia. That figure is the highest that has been achieved in Australia for many months.

On other indicators available to us the economy is improving and the recovery is strengthening. Senator Grimes recently indicated to this House that the number of persons now receiving unemployment benefit was down on the corresponding period last year. That is the first time for many months that there has actually been a decline in the number of persons receiving unemployment benefit nationally. That, of course, will have very advantageous effects on the Budget outcome for 1983-84. I think it is entirely likely--

Senator Messner —You still cannot keep the deficit down though.

Senator MAGUIRE —I will come to that in a minute. It is entirely likely that the recent estimate of an average of 620,000 persons receiving unemployment benefit in Australia will be on the high side and the average figure will be lower than that. That will mean further savings for the Budget.

There have been dramatic increases in the housing sector in the last 12 months, both in approvals for new dwellings and, more importantly, commencements of dwellings. They have increased significantly in most States. This is reflected in a very large national increase in housing approvals and commencements. A very significant element of the upturn is the result of one of the key measures in the Budget brought down last year-the first home owners scheme, which has enabled many young couples in Australia to enter the housing market much earlier than they would have been able to otherwise. This has resulted in a higher level of home ownership and a very big boost to the housing industry in this country. That scheme is having a major effect on boosting economic activity in Australia. I will be very interested to see the final allocations for that scheme when the final Budget figures become available. It has certainly been an outstanding success. It shows what impact a government policy measure can have on the level of economic activity.

The previous speaker in this debate, Senator Hill, referred to the level of inflation and talked about the impact of medical and health costs on the consumer price index. I put on the record that even by measuring inflation on the old basis-I must say that I prefer to do that but to get a guide of trends it is certainly useful to have both-before changes were made to the treatment of health and medical costs it is still very clear that there has been a significant reduction in inflation during the life of this Government. On the old basis of compilation of statistics the consumer price index increase in the March quarter 1984 would have been only 1.2 per cent. That is the lowest quarterly increase for a long time. In the 12 months to the end of March this year, on the old basis with medical and health costs treated in the former way, the inflation rate measured by the consumer price index was only 7.6 per cent.

Senator Messner —That was not due to your policies; it was due to the wages pause.

Senator MAGUIRE —There is a very large reduction in the inflation rate, a further reduction in the 12 months to the end of December when the inflation rate was 8.3 per cent. With medical and health costs included in the former way there has been a 0.7 per cent reduction in the annual inflation rate in one quarter. That is a significant reduction.

Senator Peter Rae —And the direct result of the former Government's policies.

Senator MAGUIRE —Honourable senators on the other side are, I presume, mouthing off about the wages pause, which was not sustainable. Such an inequitable policy which constrained the wage claims of one group in the community surely could not have worked or been sustainable for more than about six months. I think most honourable senators opposite know that the reductions in inflation that are now occurring are very much the result of the policies of this Government. The accord is a much more sustained policy measure than the wages pause could have ever been, because it was so inequitable and so unfair and just would not have lasted. As I have indicated, the inflation rate as measured on the former basis is now running at 7.6 per cent annually, a very sustained reduction in the rate which applied earlier last year. It augurs well for the trend in interest rates and, in turn, it gives us a further cause for optimism in the housing sector.

One of the things in which I am particularly interested, as I am sure, are officers of the Treasury, is the varying trends in unemployment rates in the various States in Australia. I am certainly looking very carefully at the moment at the relative improvement in unemployment in South Australia, where the difference between the national average and the unemployment rate has narrowed dramatically in recent months. I hope that very soon average unemployment in South Australia, which in recent years has been a relatively depressed State, will go below the national average.

Senator Messner —How much of that is due to the CEP, do you think?

Senator MAGUIRE —When it does go below the national average, it will be the first time that that has happened, according to my research, since 1976 or 1977. So that will be a major improvement in that State. I stress to Senator Messner that I am talking about the relative improvement in South Australia compared with the national average. I am sure he is aware, as are most honourable senators, that the community employment program is operating not only in South Australia but in all States. So there is no real validity in his arguments, unless he can demonstrate that the CEP in South Australia is well ahead of other States. He might be prepared to issue a statement on that matter. If he does, I will be pleased to read it. I stress that I am talking about relativities. I am hopeful that in the near future the unemployment rate in South Australia will go below the national average for the first time in seven or eight years.

In conclusion, I indicate that I am hopeful that the deficit figure in the Budget this year will be less than the most recent estimate. I understand that the estimate of the deficit outcome made by Minister for Finance (Mr Dawkins) is the product of these appropriation Bills and also revenues. I think the deficit estimate, as was recently estimated, will be reduced to below $8.7 billion in the final figures for the 1983-84 year. I believe that the figure will be a little lower than that. I look forward to tax cuts in the next Budget in August. I believe that the Budget to be brought down in August will contain significant reductions in income tax.

Senator Peter Rae —They will be a bit like the 1975 tax cuts, I bet.

Senator MAGUIRE —I bet they will be better than the 1977 and 1978 tax cuts introduced by the previous Government. I believe that significant tax cuts will be introduced in the 1984-85 Budget in August. I believe they will be focused on lower and middle income earners. These tax cuts will give a significant boost to economic activity and in that way will assist in the further creation of employment in the community. Most importantly, the tax cuts will ensure continued existence and further robust health for the accord between the Government and the Australian Council of Trade Unions.

Debate (on motion by Senator Ryan) adjourned.