Senator HUTCHINS (6:00 PM) —I should preface my remarks on the Diesel and Alternative Fuels Grants Scheme (Administration and Compliance) Bill 1999 and related bill by saying that I have been involved in the road transport industry, not just as a union official but as someone who worked in it and as someone who at one stage was an alternate director of the Road Transport Forum, which has subsequently become the Australian Trucking Association. So I feel I have experience and knowledge of some of the difficulties that will befall the road transport industry in relation to the compliance and administration legislation that the government has put forward.

When I look at the legislation, I see three questions that stand out. I talk from my own experience. They are: will it reduce costs; will it encourage more environmentally friendly vehicles and operations; and subsequently—something that has not been defined yet—what are the boundaries between conurban and non-conurban Australia? From my own experience in the industry, I am very sceptical that the offer that is being made to the road transport industry will in fact reduce costs to the consumer. In all the years that I have been associated with the industry, I have seen a number of very good road transport companies operate and try to work within the system. It is a well-known fact that road transport is one of the few industries in this country that are world's best practice. It is an industry that delivers not only to the consumer but also to its work force, its producers and its clients.

But I must say that people in this industry have been under extensive cost pressures for many years now. The people who are putting them under these cost pressures are not the consumers of Australia but the people in between: the retailers, the manufacturers and the primary producers. In all these administration and compliance costs, I cannot for the life of me see how any of the pressure is going to be put on the likes of the retailers or the manufacturers; the pressure is going to be on that road transport operator alone. He or she is the person who is going to have to comply with those administration costs. He or she is the person who is going to have to make sure that everything is hunky-dory with the Taxation Office.

I do not believe that the people who are involved in this industry have at all grasped the enormity of the task they will have to perform to ensure that this legislation is complied with. As they know and I know too, the government will be able to make sure that they comply, that they are administered, but it will never be able to make sure that those cost reductions, whatever they may be, will be passed on to the consumer. As you would know, Mr Acting Deputy President, consumers are already very wary that a number of retailers are already increasing their costs to cover the eventuality of the cost reduction that will occur as a result of the GST package. I cannot see in this legislation any means by which those middlemen between the transport operator and the consumer, or even between the transport operator and the producer, will have to show compliance. I do not believe there will be any control over them. As I said, this is a world's best practice industry. It has slim profits, and already at the moment there are rumours about some of the operators being in a bit of difficulty.

So, when we come to compliance and administration, I do not think that the government or the people who drafted this legislation have totally grasped how cumbersome it is and how much it is going to add to the costs of that individual road transport operator. In the end, that person is going to be in the middle. It is not going to be the retailer, the manufacturer or those people between the transport operator and the consumer. The consumer and the road transport operator are going to be the ones who miss out. But I will tell you one thing: the retailers and the manufacturers are not going to miss out.

If we go back many years, as I can, to the days when there was road maintenance tax in this country, there were a number of avenues by which people could avoid that tax. I was talking to a mate of mine on the phone this afternoon and he told me how he used to avoid the tax. Because primary products were exempted, he used to say that he had frozen chooks in the back of his chiller van. When the compliance people came along, he used to say that he had those chooks in there and that he could not break the seal of the vehicle. The thing was that he probably had a box of chooks or something but the rest of it was fully loaded freight. He was able to avoid paying that tax.

The other problem is that in New South Wales—I do not know about other states—truck drivers who had not paid the tax used to go up to the police station, say that they had not paid this tax and then get imprisoned for a week or two. That is how they used to pay the tax. They never paid the money; they paid it through serving time either in their local police station or by going to one of the minimum security jails in New South Wales.

I do not know what the situation will be if you do not comply with this legislation or do not administer it properly. Will we see a repeat of this? The government might remember—it was only 20 years ago—when we had one of the biggest and most serious civil disruptions in this country. We had trucks block Razorback, north of Canberra, and days and days of argument from men and women who were fed up with the amount of taxation that had been imposed upon them, paying it in dollars or in jail sentences. Luckily, we had a Labor government in New South Wales and we were able to do something about changing that, because there was nothing that the federal Liberal government could have done. They sat idly by and let other people solve their problems for them. We want to be very careful about what happens if people do not comply with the administration or the determination of this legislation, because we do not want to see the return of that situation in this country. People who work honestly and toil hard are entitled to their reward. I repeat again that I do not believe this legislation will ensure that any of the benefits that occur as a result of cost reduction will eventually get to the consumer. They will be gobbled up by retailers and manufacturers.

I would also like to comment on the environmental aspects of this legislation. There does not seem to me to be any incentive whatsoever for companies to replace their vehicles. At the moment, 50 per cent of all commercial vehicles in the country are over 10 years old. Some 30 per cent are over 15 years old. That means that there is pollution, black smoke, being spewed out by diesel vehicles because they are not complying with standards that have been introduced from the late 1980s. This scheme will not give incentive to road transport operators to change their vehicles.

One of the things that we should make sure of—and I am sure that there are people who would be opposed to this—is that vehicles are more productive. That means bigger vehicles, which means fewer vehicles on the road. But, again, there is no incentive for that to occur. In fact, because of the emission control legislation that is being introduced, 1999-model engines onwards will now consume three per cent more fuel than engines made prior to 1999. Where are we going in terms of getting more trucks off the roads, if that is what people want? It is not here in this legislation. There is no encouragement. There is no incentive. There are only costs and burdens, and people will do whatever they have to do to make sure there is bread and food on their tables to look after their families. If that means evading legislation or doing things like that, you can bet London to a brick on that that will occur.

I also want to mention the boundaries between what can only be referred to as conurban plus Tasmania and non-conurban. I understand from my mates in the transport industry that there has been a series of discussions with the minister to define the boundaries of conurban and non-conurban. In every capital city in this country, we could ask whether the City of the Blue Mountains is in the conurban area or whether the City of Wyong is in it. We could go along those lines. As I understand it, in these secret meetings that the industry has had with the minister a series of maps have been put up in the office. These maps have been put up to try to define what are the conurban and non- conurban areas. The people who attend these meetings are not allowed to take notes—and they are not allowed to take notes for one reason: the government has not concluded the deal with the Democrats about conurban and non-conurban areas. Where is the honesty in this? The secret meetings are under way at the moment, and we will inevitably see the results of them. This deal will disadvantage people in urban areas. It will not advantage people in regional or rural Australia. It will disadvantage a whole heap of Australians. It will not give you environmentally sound engines or take your emissions out of the air, because there is no incentive in this for people to update or upgrade their vehicles. It is a retrograde step.

This legislation needs a lot more thought—go back to my comparison about the frozen chooks. I am sure that, in the scheme of things, we will find lots of frozen chooks in this legislation. We will find loopholes, but the biggest loophole will be that—I will bet London to a brick on, as I said earlier—there will be no advantage to the consumer, because the government's legislation does not have any mechanism whatsoever to ensure that there is some control between the transport operator and the retailer or manufacturer. I have seen time and time again in my lifetime how those people between the consumers and those operators are the ones that can exploit any loophole or any opportunity that comes along.