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Thursday, 14 May 1987
Page: 3210

Mr TICKNER —I address my question to the Minister for Defence. I ask my question in my capacity as a local member but also as one of the co-conveners of the Government members Defence Force action committee. I ask the Minister whether the Government's commitment to improve the quality of defence housing, so badly neglected under previous governments, will be affected by the Treasurer's statement last night as it relates to defence cuts?

Mr BEAZLEY —I thank the honourable member for his question and for the work he has done on his committee. On behalf of his constituents, who include a very large number of Defence Force personnel, he has put forward their case to me most forcefully. In answering the question I also take the opportunity to explain again to the House some features of the defence budget which, in the Commonwealth's system of budgeting, are unique. Fundamentally, the defence budget is treated as a global amount. The Department of Defence is sent away within that global amount to make adjustments as it sees fit. So in a situation, such as the situation we have this year, of negative growth of one per cent we are invited to assign priorities in the defence budget in the areas that are taking cuts. Being treated on this global basis, we also become the recipients of whatever savings we can make. As I have pointed out previously, for example, in the defence factories there has been a $360m subsidy, which in itself is equivalent to about 4 per cent real growth if it were eliminated. The fact that substantial amounts of that have already been eliminated by decisions we have taken also gives us greater flexibility. Therefore, essential programs, including housing, are capable of being protected even in situations where we are looking for cuts in other aspects of the defence function. So there will be some quite substantial cuts in minor capital works and minor equipment features that are not related to the White Paper in the defence vote. There will also be some cuts in operating activities, including some substantial cuts in the civilian personnel side of the Defence Department. However, major projects will remain. Evidence of that was provided by the decision I announced yesterday, for example, to provide an additional 25 Black Hawk helicopters to improve the airlift of the ground forces. Even though cuts in the operating areas will be substantial during next year, also protected will be the initiatives I announced in relation to the South Pacific earlier in the year.

In the housing area, to which we assign high priority at this stage, in outcome terms we spent, apparently, about $61m last year. Our intention next year is to spend $75m. So we will be taking some cuts, more substantial cuts perhaps, in other areas of the defence vote in order to protect that very substantial increase. As the honourable member and other honourable members who have an interest in this area have pointed out to me frequently, this area was sadly neglected for many years under our opponents. We must do whatever we can to protect the basic conditions of those who serve this country so well.