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Monday, 16 September 1985
Page: 564

Senator RICHARDSON(4.21) —I wish to speak on this matter of public importance introduced by Senator Chaney. I want to take up first Senator Chaney's point where he criticised the Government for daring to have a Cabinet meeting on a weekend. He said that that showed that we could not get our act together. He used words to that effect. It was a fascinating comment. I can recall during the years when Fraser and Howard ran Australia-the years that the Opposition is continually trying to forget-they had Cabinet meetings at very odd times. Of course, it all depends on attitudes and priorities. The priority for this Government to organise the full Ministry to meet for 2 1/2 days, including both days of the weekend, was the taxation system that affects each and every Australian. That was the priority that the Government set and that is why all the Ministers gathered in Canberra.

The Fraser Government had a different set of priorities altogether. It had Ministers and their staff flying all around the country in the dead of night, after midnight, to race to Canberra for a Cabinet meeting on the issue of merino rams. We all remember what Mr Fraser's attitude was in the end with wool off the sheep's back and where it could be sent. His was packed off to Russia as soon as it could be taken off the sheep's back. That is what that Government did with Cabinet meetings. It thought that the real priority was anything that affected the country squire from Nareen. For that reason, many thousands of dollars were spent in rounding up the Cabinet members of the day and their staff from all around the country, throwing them into VIP aircraft in the dead of night and whizzing them to Canberra. This Government will only do the dramatic deed of calling together all Cabinet Ministers-I am sure that Senator Grimes will be able to confirm that they have other things to do on the weekend--

Senator Grimes —I would prefer to be watching Parramatta.

Senator RICHARDSON —I know that other Ministers, who do not like giving up weekends, given the importance and gravity of any changes to the taxation system, saw it as their duty to come to Canberra to look at what the tax package might be. I am not privy to all its details; I can only go on what I have read in the newspapers, as I am sure that is what the Opposition is going on, but we will all know in the course of the next few days what is in store for each and every one of us.

In looking at the words of the matter of public importance and the words used by Opposition senators speaking to it, we have to ask ourselves, on the question of taxation and the Liberal Party, just who can we believe? Which voice on the Opposition side should we believe when it comes to matters of taxation? I will refer to some quotations from someone who might be called an important person in the Liberal Party-not some fringe dweller; not someone who once walked past a room in which the Liberal Party was having a meeting. It is someone who has raised millions of dollars for the Party; so this bloke has the big entree; he is the king of the kids. More than that, he has been President of the New South Wales branch of the Liberal Party and was elected recently as the national President of the Party. I am sure it is not forgotten by anyone, least of all Andrew Peacock, that he was the stalking horse for John Howard. Within days of his election, and even before it, he was disowning Andrew Peacock at a hundred miles an hour because he wanted his man, John Howard, to get up. I am referring of course to Mr John Valder, who is now the national President of the Liberal Party. He did an interview-I think he regrets it now-on the Number One program which was financed by the Westpac Banking Corporation. I was asked many times to do that; thank God I had the good sense to say no. Mr Valder did not have such good sense; he said yes. He presumably told the truth as he saw it about the direction in which the Liberal Party might go. Mr Valder said:

So if you are talking about reducing government spending, it is all very well to say we will privatise this and we will do that and fiddle about. That's all fiddling with the edges.

The big reduction has to come in social welfare-

He went on to say:

Look what has happened over even the assets test which, if I can be a little candid on your private program, was a very small step in that direction.

Senator Grimes —Did you see Johnnie Howard about that on television yesterday?

Senator RICHARDSON —I will get to Mr Howard's beliefs on things like that, because they are important. Mr Valder went on to tell us how the outrage over the assets test was a demonstration of how one cannot take anything from people once they have it. I suppose that he could claim some sort of ambiguity on that statement. We are talking about fringe benefits in this matter of public importance, which states:

The devastating impact on small business and employment prospects of the Government's proposed tax on fringe benefits-

This next quotation is a little central, one would have thought, to the issue. Mr Valder said that there was no such ambiguity in his attitude to the `whole disease' of fringe benefits. He said:

Paul Keating had been foolish in attempting to do it in one stroke. It would simply be better to do it over three or four years-

His conclusion, therefore, was:

So I have said many times, you know, let the Labor Party get on implementing the more necessary, but perhaps less popular parts of our policy.

And let's hope they get them into place and promptly lose office.

And I think that would be a very good scenario, don't you?

In answer to whether we would lose office, I reply no, that would not be a very good scenario, but that comment shows up the absolute hypocrisy going on in the Opposition on the question of taxes on fringe benefits, because what Opposition senators say privately is very different from what they say in the chamber. I quote also from a journal which I think is read widely around Australia-not a socialist rag, not the Tribune or Direct Action-the Australian Financial Review. In its editorial of Friday, 2 August 1985 it said, in reference to what Mr Valder had been saying:

The underlying implication is that in opposing such initiatives as the assets test, the tax on fringe benefits and other proposals of the Government, the Liberals are engaged in a sham. Actually they want the Government to succeed in imposing such measures, draw a full measure of public wrath (whipped up by the Opposition piously proclaiming contrary policies) and then go down to defeat.

That is what the Opposition is really about. What it is really saying is yes, the tax on fringe benefits is a good idea; by all means do it. We are not going to touch it, of course, because we think some people might be upset. The Australian Financial Review states:

The implication is quite clear that Mr Valder, at least, thinks that what Mr Keating is doing to cut government spending is quite correct.

Then it goes on to say, and these are the telling words:

There are at least reasonable grounds for speculating that his views in this regard are not far removed from those of--

as he was then--

Deputy Leader John Howard.

The cat was really let out of the bag. Mr Valder naively believed that that program, shown to the top 300 Australians-

Senator Grimes —I got one!

Senator RICHARDSON —I got one too. I am almost happy to say that it was shown to the top 300 Australians. Mr Valder believed naively that that would in some way be kept a secret and that it would all be private. But we all know the way the world goes round and it got out. The cat was out of the bag. John Howard's stalking horse-the one who was publicly stalking Andrew Peacock for him-had come out and said, `Yes, we must have these taxes on fringe benefits'. The only concession he would make was that it should take three or four years; it should not be done in one go. Of course, it is not surprising that the Liberals lack the courage to do it in one go. They did not have the courage to do anything about tax reform in the seven years they were in office. Why would the leopard suddenly change its spots?

Let us have a quick look at the record of the Liberal Party on tax. It had seven years in office. Most Australians, whether they be in the unions, big business or small business, would be trying to forget that. Let us look at what the Liberal Party did about its tax policy in seven years. Most honourable senators would have some little memory of a person called Costigan who had a royal commission. It was supposed to look at what were thought to be the activities of the Federated Ship Painters and Dockers Union. This was a clever political ploy by the Fraser Government to embarrass the Labor Party. But that is not quite what happened. A funny thing happened on the way to the forum and all of a sudden the Liberal-National Party Government found itself in the middle of a right royal scandal not only because so many of its supporters were up to no good in respect of tax avoidance, but also because Mr Costigan revealed to Australians the full extent of tax avoidance in this country and its growth in the Liberal Party. He said that no other industry has experienced such growth since the heady days of the Victorian gold rush. If one looks at the record of growth in business generally in the seven years of the Fraser Government, one sees that there was negative growth in the last two years and that the only industry which had any growth at all was tax avoidance. In June 1975, 861 individuals and companies were identified as being involved in tax avoidance schemes and the tax in dispute was $973m. By June 1983, the number had grown to 34,944 individuals and companies and the tax in dispute was $1,666m. That is the industry that really grew under the Fraser Government, that is where it had its real success.

In 1980 Professor Russell Mathews said that tax authorities, governments and the courts had allowed tax avoidance to flourish on such a scale as to make personal income tax a voluntary tax for the rich, non-salary earner. That is really the record of the Liberal-National Party Government in its years in office. That can be contrasted with the record of the Labor Government which, as soon as it came in, brought in the prescribed payments tax and, not to anyone's surprise in the Government ranks, but no doubt to the extreme surprise of those on the Opposition benches, 51,000 Australians-that is, individuals, companies and partnerships-were suddenly discovered. In the course of less than one year 51,000 new tax entities were discovered and now they are paying their rightful share of tax into government revenue, tax that they were able to avoid with impunity and ease while the Liberal-National Party Government ruled the roost and, indeed, while John Howard was Treasurer.

As I was sitting in my room trying to prepare some remarks for my speech, I heard Senator Chaney piously ending his speech, telling us that what we really need is to get employment going in Australia in 1985. He said that we must set about creating the conditions for growth in employment. Coming from a former Minister in the Fraser Government, that is almost fantastic. If one looks again at the record of the Fraser-Howard Government on employment one can get some idea of what all Australians might be able to expect. For every week that the Fraser Government was in office between 1975 and 1983, unemployment rose on average by more than 1,000; more than 1,000 every week. During the last year alone of the Liberal-National Party Government-a year in which Senator Chaney was a Minister and John Howard, the new leader for whom John Valder did all that stalking, was the Treasurer-unemployment went up by 270,000. In that last hateful, miserable year of government so much damage was done to our economy.

In 1975 when the Liberal-National Party took office unemployment among 15 to 19-year-olds was 12.9 per cent. By the time it left office in March 1983 that figure had risen to 24.3 per cent and one in four teenagers was on the dole. That is the recipe that we were given for seven years by the Liberal-National Party Government-a government in which John Howard was so prominent. That is what we will get again if ever the Liberals return to the treasury bench. In response to that, this Government which has been in office less than three years has created 400,000 jobs and will exceed its promised target of 500,000 jobs well and truly. All Australians recognise that success, all Australians are now a part of it. As the years go by more and more will join in the economic miracle that is at last occurring in Australia, a miracle delayed for far too long by the unhelpful intervention of seven years of Liberal government.