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Tuesday, 7 May 1985
Page: 1485

Senator KILGARIFF(10.54) —On Monday, 22 April, Senator Peter Rae, as shadow Minister for Finance, asked a question of the Minister for Finance (Senator Walsh) relating to the superannuitants of the Northern Territory. Around that time it was announced, almost completely out of the blue, that the Federal Government would no longer assist in the financing of the superannuation scheme of the public servants who, before self-government for the Northern Territory, were Commonwealth public servants. Of course, the situation has now been put in jeopardy. It is my understanding that if the Federal Government does not respond to its responsibilities $43m will have to be found somewhere along the track to rescue the scheme.

I was rather surprised, as were most other people, by the vehement attack made by Senator Walsh in response to the question by Senator Peter Rae. Indeed, there has been a considerable number of queries as to why a Minister of the Crown should take that action. At this stage I take the opportunity of seeking leave to have incorporated in Hansard a letter from Ian Tuxworth, the Chief Minister of the Northern Territory, to Mr Hawke, the Prime Minister. It has been cleared by the Minister for Industry, Technology and Commerce (Senator Button), who is on duty in the chamber tonight.

Leave granted.

The letter read as follows-

2 May 1985 The Hon. R. J. L. Hawke AC MP,

Prime Minister,

Parliament House,

Canberra, A.C.T. 2600.

My dear Prime Minister, I write in response to the assault made by the Minister for Finance on the financial arrangements between the Northern Territory and Commonwealth Governments, in relation to the superannuation arrangements for Northern Territory public servants. I wrote to you on this matter on 18th April, 1985, and although I sought discussions with you as a matter of urgency, I have received no response to my request.

Since that time I have had the opportunity to investigate the matter further and have received advice on a range of relevant issues. The information which I have received is of great concern to me and should be of considerable concern to yourself and your Cabinet when you are made fully aware of the implications of Senator Walsh's actions.

The information which I have received has done nothing to quell the anger which I feel and which is felt by Territorians, at the manner in which the Territory has been treated by Senator Walsh. Such an action is made so much more odious in the light of the spirit of disclosure, discussion, consultation, conciliation and consensus which has been the hallmark of your Government since it came to power in 1983.

It would appear that the pursuit of some of the options available as a result of Senator Walsh's letter of 4th April, 1985 have wide ranging consequences. Some of these issues are summarised below.

The issues of a legal nature require prime consideration. It is questionable as to whether the Commonwealth has the power to make regulations to preclude the Northern Territory public servants from being ''eligible employees'' under the Superannuation Act. Considerable doubt exists over this power, having regard to the fact that the Northern Territory Public Service is an ''approved authority'' under the Act, the powers of the Act that deal with the consequences of the proposed action, and the arrangement reached in October 1984 between the Northern Territory and the Commonwealth on employer superannuation benefits. It brings into question the proper use of the Commonwealth's powers in respect of such a matter.

The issues of natural justice and discrimination are also disturbing. Northern Territory public servants are compulsory members of the Commonwealth Superannuation Scheme. Their right to entry, and continued participation in the scheme was agreed at the time of Self Government and detailed in the Memorandum of Understanding. To act unilaterally in the manner proposed by Senator Walsh which will detrimentally affect existing rights and legitimate expectations of these public servants is inconsistent with the purpose of the Act, and is contrary to all principles of natural justice. The proposed action also discriminates against a group of employees who had hitherto been regarded as 'eligible employees', but who for no valid reason, and as a result of no change in their circumstances, could now be excluded from the scheme and would incur serious financial penalty.

The matter of employee relations is of extreme concern to my Government, and indeed it has been my understanding that it was also of concern to the Federal Government. However, Senator Walsh's action has not been discussed with the A.C.T.U., the Northern Territory Trades and Labour Council nor any of the individual unions concerned. This is clearly inconsistent with the principles of consultation and consensus.

Many complex issues which affect employee rights and conditions of service are involved. There is also a number of categories of Northern Territory Public Service employees who may be affected in different ways by this proposal. Preservation provisions for example are not designed for members who become ''ineligible'' through no action of their own.

There appears to be no provision to allow for a transfer value to be paid to another scheme should that be so desired when there is no change to public employment. In the case of those employees with less than 5 years contributory service, no preservation provisions apply at all. Nor is it clear that they apply where service exceeds 5 years duration.

The situation in respect of compulsory transferees from the Australian Public Service to the Northern Territory Public Service provides further complications. Implicit in the transfer of this group of employees is the continuation of all conditions of service and superannuation. If the Commonwealth, by its actions, eliminates any of these rights, such employees may have the right of action against the Commonwealth. Certainly the Commonwealth has a continuing obligation to ensure that the terms and conditions of service of compulsory transferees are satisfactory, given that they retain rights in respect of the Commonwealth Public Service.

I find it unthinkable that such complex issues should not have been discussed with employee organisations as well as the Northern Territory Government before such precipitous action was considered.

The action of the Minister for Finance has struck at the very basis of the principle of inter-governmental relations. It has disregarded a carefully negotiated financial arrangement between the Northern Territory and the Commonwealth which was ratified only 6 months ago. It has also struck at the Memorandum of Understanding which establishes the financial arrangements which serve as the cornerstone of Northern Territory Self Government.

The actions of the Minister for Finance have placed the relationship between our Governments in an intolerable situation. The issues have not been adequately considered and when the ramifications are realised, I have no doubt that it will be necessary to modify the approach contained in the Minister's letter.

I would suggest to you as strongly as I can that our Governments enter into serious and constructive negotiation to resolve this issue. So that this may occur, I ask you to set aside the proposal contained in Senator Walsh's letter of 4th April, 1985.

I seek your urgent concurrence to this proposal and offer to meet with you at any time to discuss these matters.

Yours sincerely, IAN TUXWORTH

Senator KILGARIFF —I ask those interested in the matter to peruse the letter incorporated in Hansard because many issues of a legal nature requiring prime consideration are brought to light in it. I refer principally to whether the Federal Government really has the power to do so. The issues of natural justice and discrimination are also points to be considered as the Northern Territory public servants were compulsory members of the Commonwealth superannuation scheme. Indeed, at the time of self-government the Commonwealth public servants had to be encouraged to become Northern Territory public servants. I believe that in order to achieve this an iron-clad scheme of superannuation was made available to those public servants. It appears, at least at the moment, that at the whim of a Minister this has been brought undone.

I also understand that those former Commonwealth public servants who are now Northern Territory public servants are members of various unions. It is my understanding that the Minister has not had discussions with the Australian Council of Trade Unions, the Northern Territory Trades and Labour Council and the individual unions concerned. It is rather amazing that a Minister who speaks of the principles of consultation and consensus could be inconsistent. I believe that many Australians, particularly those in the more remote areas, are not aware of the attacks which have been made on Northern Territory funding by Canberra over the past month. Certainly the recent Four Corners program entitled 'Northern Territory High Rollers' should have dispelled any doubts that the Federal Government means to cut the Northern Territory's funding, and cut it severely. We know there will be cuts in funding for the States and the Territories. However, it seems at the moment that there will be a much more severe cut imposed in the North.

At the forefront of the Commonwealth's attack is Senator Peter Walsh, the Federal Minister for Finance, who seems to believe that the Territory is living off the sweat of the rest of Australia and is making no contribution of its own to the national economy. Senator Walsh ignores the fact that since self-government the Territory's growth rate has far exceeded those of the States. He also fails to address the fact that Aboriginal land rights legislation has tied up vast tracts of the Northern Territory and virtually ensured that mineral exploration has ground to a complete standstill. This, combined with the Federal Government's attitude to the development of Northern Territory uranium, is depriving the Territory and the nation of thousands of millions of dollars in mineral revenue.

The other aspect of Senator Walsh's attack on Territory funding which does not stand up to scrutiny relates to his assertion that per head of population we receive much more than our neighbours in the States. While this statement is true in itself, the fact remains that the Territory has about 10,500 square kilometres per 1,000 people compared with about 150 square kilometres per 1,000 people in New South Wales and about 57 square kilometres per 1,000 people in Victoria. Services such as the provision of sewerage systems, roads, electricity, hospitals and educational facilities must be provided in this remote area in the North to a sparse population spread across a vast and often inhospitable area. Of course, it will be a more expensive business to provide these services under those circumstances but hopefully every honourable senator, except perhaps Senator Walsh, would agree that Australian citizens living in these areas are entitled to a reasonable standard of living not too far below that of the more populous States. Unfortunately, his recent approach to the issue of superannuation arrangements for Commonwealth public servants-that is, Northern Territory public servants-does not give much hope of encouragement.

We have seen Senator Walsh, with the apparent approval of the Federal Labor Government, renege on the agreement which had been reached between the Territory Government and the former Federal Minister for Finance, the Hon. John Dawkins, only last October. It is my understanding, of course, that it was the Hon. John Dawkins, as the Minister for Finance, who pursued this arrangement for the continuation of superannuation, with the result that the Northern Territory public servants have been left wondering where they stand in relation to their superannuation scheme. I can tell you, Mr President, that there are some very worried people.

Senator Walsh has set a very poor example of the operation of a government of consensus and conciliation in his handling of this matter. The Prime Minister (Mr Hawke) is fond of speaking of consensus at election time and when he is convening an economic or taxation summit. Yet now he refuses to show any interest in solving the present problem in relation to superannuation. Indeed, I, along with the Territory's Chief Minister, Mr Tuxworth, and Paul Everingham, who was the previous Chief Minister, have written to the Prime Minister to seek discussions on the superannuation issue. Our requests to meet and discuss the matter were dismissed because the Prime Minister did not have time. I know that Mr Tuxworth has written again to seek to have talks with the Prime Minister. I hope that his second request will be treated with the seriousness and urgency which it deserves.

I say that it is time that the Territory bashing within the Federal Government in Canberra was brought to a halt. If the Prime Minister were really concerned about national reconciliation he would meet his responsibilities and act to prevent the continuing attacks on the Territory by people like Senator Walsh, before serious damage is done to the development of the North and, perhaps more importantly, to the confidence shown by both national and international investors in pouring vast sums of money into industry in the Territory, particularly over the last seven years.

Senator Walsh's irresponsible attitude not only has the potential to affect the Territory's economy and development, but also in the process may deprive the Commonwealth of some of the revenue which Senator Walsh so desperately wants. It is a matter of concern that the vast industries being developed in the remote areas of the Northern Territory, which have the potential to put a considerable amount of money into the coffers of the Federal Government, can be destroyed by, as I say, this shortsighted treatment of the Territory by the Minister for Finance, Senator Walsh.

In closing, I ask a question of the Prime Minister, as I have not had the opportunity to do so previously. In light of the letter that has been written to him by the Chief Minister for the Northern Territory, which has been incorporated in Hansard, I ask: Is the Prime Minister concerned that his failure to discuss with the Northern Territory Government the matter of superannuation arrangements with the Northern Territory public servants, despite a request from the Northern Territory's Chief Minister for a meeting, has set an undesirable precedent for the conduct of intergovernmental relations? Is it the policy of a government of consensus and conciliation to renege on agreements entered into as a result of lengthy and considered consultation-such as the agreement reached between the Northern Territory and the previous Minister for Finance, the Hon. John Dawkins, in October last year on the matter of superannuation-and to replace those arrangements with decisions taken unilaterally by a Federal Minister for Finance who, far from approaching any matter relating to the Northern Territory in the spirit of consensus, has consistently attacked the Northern Territory and its Government, and has even gone so far as to suggest that the memorandum of understanding which has governed the Territory's financial relationship with the Commonwealth since the Territory was granted self-government in 1978 is no longer operative? I refer to Senator Walsh's reference to the previous memorandum of understanding in reply to a question asked of him on 22 April by Senator Peter Rae.

Finally, I ask: Firstly, will the Prime Minister give an assurance that his Government and his Ministers, including Senator Walsh, acknowledge that the memorandum of understanding, as agreed upon by the Commonwealth and Territory governments in 1978, is the agreement which governs the Territory's financial relationship with the Commonwealth, and is still operative? Secondly, will the Government undertake to meet with the representatives of the Northern Territory authority and, in the spirit of consensus, come to a realistic arrangement on Northern Territory superannuation?