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Monday, 13 May 1985
Page: 1815


Senator JONES(4.43) —This afternoon we are debating a matter of public importance introduced by Senator Peter Rae, namely:

The urgent need to implement an effective program for business deregulation.

This matter is certainly assumed to cover a broad field, judging by the comments of previous speakers in this debate. It has ranged from the business area to trade union wages and, in the time that is available, honourable senators could not possibly cover the total area of this subject. I wish to make a couple of comments on this matter. What has to be understood is that the Hawke Labor Government has already taken action to deregulate in a number of areas. It has taken that action fairly positively, when one considers deregulation in the car industry, the steel industry, finance and banking. One could discuss whether we should deregulate the interest rate, the dairy industry, and the sugar industry in my own State. There would be some argument against deregulation in those areas because of the protection that is inbuilt for those industries. I suppose the way in which one argues the matter of deregulation depends on the view one takes, one's involvement in the industry and the financial return to that industry.

I return to the action which the Government has taken on deregulation. It is important to recognise the costs of regulation. Based on 1978-79 figures, the cost was assessed at $3,720m. That covers both State and Federal spheres and is the cost of making those regulations work. One must consider the effect of any attempt by the Federal Government to deregulate and to reduce that amount of cost to industry and business-and when I talk of business I prefer to talk of small business, as regulation has a definite impact on small business. We must consider the amount of money that is spent on regulation that would be saved to industry if some of the regulations that are now in force could be cut back. Senator Childs referred to a meeting held by the Prime Minister (Mr Hawke) on 11 October 1984, at which he had asked the Australian Council of Trade Unions and four industrial groups-the Business Council of Australia, the Confederation of Australian Industry, the Associated Chambers of Commerce and the National Farmers Federation-to identify those regulations that were considered to impose unnecessary and substantial costs on business, and to give views on whether such regulations should be modified or abolished in order to assist industry. The Prime Minister also asked the ACTU and those industry groups to meet government officials to draw together the conclusions and the examinations by the various groups, and to again meet the Prime Minister and relevant Ministers to review progress.

The Prime Minister proposed a thorough evaluation of any new regulatory proposals to ensure that benefits outweigh costs. I think that is an important consideration when one considers the effects of changes in regulations. On 11 December 1984 the Prime Minister also wrote to all Premiers and the Chief Minister of the Northern Territory to request that they send forward some information on the subject of regulation or deregulation at both State and Federal level. Senator Maguire referred to the position in South Australia and also referred to the referendum that was defeated. Had members of the Opposition, particularly Senator Peter Rae, really believed that it was urgent for some action to be taken on deregulation, they surely would have been out supporting the referendum. The referendum proposed an interchange of powers between the States and the Federal Government. I believe that such an interchange of powers between the Commonwealth and the States may have helped to alleviate over-regulation throughout Australia. The Prime Minister made that request and the responses he has received so far have been from the BCA and the CAI. At this stage I think the Prime Minister is still awaiting further information from the ACTU, from the State Premiers and from the Chief Minister of the Northern Territory on the subject of deregulation and what action should be taken by the Federal Government.

It is fairly important to consider the views of the Confederation of Australian Industry-a body that may well not put forward points of view that I would argue. I refer to a letter written by Mr Ken Williams, the President of the Confederation, to the Prime Minister. That letter clearly outlines the matter with which this debate is now dealing, namely, over-regulation of industry. Mr Williams in his letter estimated that the cost of State and Federal regulation in 1978-79 was $3,720m and that it would be substantially higher. If we look at the situation today, in 1985, of course we find that a greater imposition is being placed on industry because of the cost of regulation. Mr Williams made a number of other points. He stated:

. . . CAI has identified regulations across a broad range of private sector activity which are adding substantially to industry costs.

I think that goes without saying. He went on:

These regulations for example include non-uniform food laws--

I think that was one of the points raised by Senator Rae--

which have added $500m to food prices over the last ten years, the cost to business of providing government with statistical returns, and the administrative costs of collecting taxes and duties on behalf of taxing authorities. They impact on companies of all sizes-particularly the many small businesses--

That was the point I raised before-that one of the industries which were suffering because of over-regulation was small business throughout Australia. Small businesses do not have the financial capacity to meet the cost imposed on them because of that regulation. Mr Williams went on:

. . . represented through CAI's membership-and on all industries from mining through manufacturing to transport and finance. Suppliers of consumer goods including food, pharmaceuticals, veterinary chemicals, petroleum and electrical and electronic products were particularly critical of the costs of regulation.

I think those are fairly reasonable and valid points which he has made. I do not believe that all regulations should be removed. But some regulations should be placed on industry because we do not look only at cost. Regardless of whether we are talking about a State government or the Federal Government, I think it is important that regulations cover health matters in relation to the industry in which the goods or services are provided. Cost is not the only factor that comes into regulation. Mr Williams, who is the President of the CAI, went on:

. . . the cost to the taxpayer for supporting a galaxy of government regulations;

the cost to the consumer in the form of higher prices to cover the added expense of producing goods and services under government regulations;

the cost to the worker in the form of jobs eliminated by government regulation;

the cost to the economy resulting from the loss of smaller enterprises which cannot afford to meet the onerous burdens of government regulations; and--

I think that point has been made--

the cost to society as a whole as a result of a reduced flow of new and better products and a less rapid rise in the standard of living.

Those points about regulations were raised by Mr Williams in a letter to the Prime Minister which was attached to a submission made by the CAI and given to the Prime Minister to allow the task force to look at the evidence which was being put forward so that the Government could look at changing some of the regulations and at deregulation in Australia. Senator Rae said that there is an urgent need for an effective program. I believe that there is a need, firstly, for the information to be gathered. Time needs to be given to government so that it can bring together the information from the various leaders of the various industries throughout Australia, including the trade union movement in general, the Australian Council of Trade Unions, and the other groups which are involved in industry throughout Australia. They need to be given an opportunity to put forward their points of view in relation to the cost factors that are being placed on their industries by the increasing number of regulations which are being placed on industry by State governments and by the Federal Government.

I suppose one would then have to look at uniformity of legislation. That goes back to the points raised before in relation to the referendum. I think it is very important that we do not have the situation where a small business, which is paying taxes at a Commonwealth level, finds that it is spending two out of every three days trying to fill out forms to meet the requirements of regulations placed on it by a State or Federal government.

One has to look at the contents of the Confederation of Australian Industry submission to the Government. If one looked through the contents one would have to say that the submission covered most of the areas which would be affected by regulation or which would benefit by deregulation in this country. Some of the items listed in the contents are:

National food Legislation

State Credit Legislation

Census and Statistics Act 1905

Foreign Investment Review Board

Sales Tax Act (Commonwealth)

Financial Institutions . . .

Prices Surveillance Act

Tax Instalment Deduction Legislation

Employment-Termination Payment

One of the views put forward by the Confederation in relation to termination payment is one of the views with which I would not agree, but certainly it is putting forward that view. I believe that the view which will be put forward by the ACTU will allow some discussion at that level where there should be some deregulation or some changes made. If we go a little further we look at what is happening in relation to lack of uniform business regulations. The CAI submission went on:

. . . a significant proportion of indirect costs to industry of State business regulation is attributable to a lack of uniformity in State laws relating to packaging and labelling, food and weights and measures.

I think that brings out the point raised by Senator Rae and that is the cost in relation to the food industry in Australia. Industry is suffering not only from the cost of regulation but also from the cost of the identification of the goods and services provided in Queensland, New South Wales, Victoria or any other State in Australia. One finds that the identification and the production of goods are entirely different from State to State. That is an imposition which is being placed on manufacturing industry and which I believe should be removed to allow it some opportunities for some uniformity throughout the Commonwealth of Australia.

Delays in deregulation need to be viewed from the point of view of groups other than those which have some financial interest in the matter. Deregulation needs to be viewed by groups such as the unions and the workers, including those on production lines, and those involved in the industry. Surely when one talks about deregulation one has to look at what will happen to those people who are involved in the industry. One has to look at what will happen to the industry itself.


Senator Peter Rae —That's what our policy provides.


Senator JONES —This is right. One has to see that we are not going to create a situation where a large amount of unemployment develops because of some action taken in relation to deregulation in that area. One proposition was put forward by Mr Jacobi in the House of Representatives. He made a proposal which was raised in the paper put forward by the CAI. Mr Jacobi raised the proposal to establish a joint standing committee on business affairs. The CAI submission went on:

There is much merit in Mr Jacobi's proposal in that it would be, if implemented, a concrete step directed not merely at making ad hoc cost saving decisions, but directed at imparting changes into the system of Government itself. It is only by the making of such changes that business will be free to flourish, unshackled by legislative burdens.

I think that sums up the position.


The ACTING DEPUTY PRESIDENT (Senator Jessop) —Order! The honourable senator's time has expired.


Senator Jones —I move:

That the business of the day be called on.


Senator Lewis —I would like to speak against that motion. The arrangement is that Senator Parer from Queensland-


The ACTING DEPUTY PRESIDENT — I am sorry, Senator Lewis, this motion is not debatable.


Senator Jones —Mr Acting Deputy President, I raise a point of order. In actual fact, Senator Parer's name was not on the list. Mine was the last name on the list. When I finished speaking I thought I was the final speaker.


Senator Button —Nobody can speak to this motion. Senator Jones has moved 'That the business of the day be called on'.

Question resolved in the negative.