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Monday, 11 November 1985
Page: 1893


Senator HAINES(3.55) —The matter of public importance that we are allegedly debating today, introduced by Senator Hill, states:

The detrimental effect on South Australians of the high interest and high taxation policies of current Labor governments.

I have no particular argument about that; quite clearly high interest rates and high taxation policies are going to have a detrimental effect on most people, particularly those who are living in States like South Australia with a large area and a small population who have large distances to travel and who are in need of significant grants-which they never seem to get-from the high taxation that is imposed upon them. On the other hand, it ought to be pointed out to Senator Hill and to others that this situation merely continued as a legacy from the previous Fraser Liberal Government. Under that Government we faced equally high interest rates, particularly in the housing area, we suffered high taxation and the people of South Australia rarely received by way of grants for things like roads and so on their fair share of what was being handed out. They did not receive a fair share according to their population; they did not receive their fair share according to the kilometres of roads that we have; they did not receive a fair share according to the amount of east-west traffic that chews up those roads and imposes an enormous burden on both State and local government for maintenance, repair and expansion. So it is encumbent on Senator Hill and his colleagues to remember that the problems facing South Australia are not just those caused by the policies of the current Labor Government.

Senator Hill spent the first seven or so minutes of his speech talking about Liberal policies on education, on health and on the Public Service. He talked about car races and casinos and he said that the election was about far more serious and real issues than those. When he did finally get around to talking about the matter of public importance, about taxation, he demonstrated in a couple of sentences a rather strange inconsistency. Early on in his speech he talked about the fact that the Labor Government was removing a tax subsidy from the restaurant trade and from businessmen by removing the concession for businessmen's lunches. A little later he castigated the Premier of South Australia for daring to subsidise 10 per cent of South Australian families so that they could keep a roof over their heads and not be pushed out of their homes because of increasing building society interest rates. I find that a rather strange inconsistency. It is apparently okay to subsidise the restaurant trade and businessmen, but it is not okay to subsidise South Australian families who need to keep a roof over their heads. It is apparently all right to subsidise one particular section of the community, but it is not appropriate to subsidise another especially when that section of the community contains large numbers of children. It is a very strange attitude to be taking and I think Senator Hill needs to think a little more closely about what he is saying in that area.

The matter of public importance is also a little odd when one considers that the previous Fraser Liberal Government talked about introducing a tax on food, clothing and housing-the necessities of life generally. The Liberal Party is now led by a man who is still talking about the introduction of a broad-based consumption tax, notwithstanding the detrimental effect this is likely to have on large numbers of Australian families.

I also find it somewhat astonishing that when Senator Hill complains about the effect of high tax policies on South Australians he omits to point out exactly how those taxation measures got through the Parliament. I was in Darwin in the middle of last week talking to a conference on the development needs of northern Australia. When it came to the panel session I was asked a question by the Premier of Queensland who was complaining, as Senator Hill is complaining, about the fact that this Government was introducing massive tax measures that were affecting primary industry and the business sector, and that the introduction of those measures was altogether quite noxious behaviour on the part of the Hawke Labor Government. He addressed a question to me regarding our attitude to this, and it was with the greatest of pleasure that I pointed out to the five or six hundred people present-and I point it out again to any- body who is listening today-that those policies of the Hawke Labor Government were passed in this place only with the full support of all Liberal-National Party senators.

Let us have a look at some of the tax measures that Senator Hill quite rightly complains are having a detrimental and deleterious effect on South Australia, a State which depends to a large extent on things such as the prosperity of its wine industry. On 7 September last year, the Senate was asked to debate and pass the Sales Tax Amendment Bills for 1984. One of those provisions included imposing a 10 per cent sales tax on wine. Coming from the State of South Australia as I do, I was particularly aware of the effect that this was likely to have in the Riverland and in the south-east of South Australia. The Australian Democrats spoke to the industries concerned and got from them the opinion that the sales tax in itself was not a problem; it was the fact that it was being introduced at 10 per cent overnight when that particular industry requires a four or five-year development period to change from one form of grape production to another. They said to introduce the tax by all means, but introduce it in four 2 1/2 per cent annual increments. We introduced an amendment to that effect. What did Opposition senators have to say about that? Through their spokeswoman, Senator Dame Margaret Guilfoyle, they said:

We believe that it is inappropriate for a party that is not in government to talk of striking and phasing in a rate of tax in an area where the Government anticipates raising close to $50m. Not because we do not understand that there will be difficulties for the industry but rather because that is our general approach to Budget measures . . .

Bad luck about the damage being done to the industry concerned; it was a Budget measure and Liberal and National Party senators were not prepared to do anything to stand in the way of the imposition of that tax. When we called a division on it we lost, with every member on the Opposition benches voting with the Government.

On 13 June last year there were changes to the lump sum superannuation tax proposals-changes which have, as I understand it, quite severely affected businesses and in particular small business people not only in South Australia but elsewhere. Having spoken to representatives of those businesses we moved to amend the legislation so that a ceiling was imposed below which the new tax provisions would not be imposed. We did that for a number of reasons. For example, a lot of people who retire early with a lump sum superannuation payment of $50,000 or less put it into developing a new business, put it into paying off a housing mortgage and leaving another one free, or perhaps put it into travel-all things which are beneficial to the Australian economy and certainly more beneficial than taxing those lump sums at 30 per cent. What happened when we moved that amendment was something very similar to what happened when we moved amendments to the wine sales tax. Senator Dame Margaret Guilfoyle got to her feet and referred to Senator Jack Evans. She said:

For him to suggest that there is some reluctance on the part of the Opposition to make its position clear ignores what we have been saying about the proposed superannuation legislation since May 1983. We have made it quite clear that our approach to legislation of this kind is that we shall repeal it on our return to government.

I suggest that anybody who believes that will believe anything, since governments are loath, no matter what party they represent, to repeal tax measures that bring them in large amounts of money. She went on to say that she was certainly not going to support `a frivolous amendment' to impose a $50,000 ceiling such as that introduced by Senator Evans.

If we look at other legislation, particularly money Bills relating to primary industry, we discover that again all National Party and Liberal Party senators voted with the Government against the interests of industries, particularly those relevant to South Australia. The Canned Fruits Marketing Amendment Bill 1984 might not sound a particularly gripping piece of legislation, but to those people involved in fruit growing and in the cannery in the Riverland of South Australia it was particularly relevant. In line with industry requests that the Australian Canned Fruits Corporation be granted a five- year time span rather than a three-year one to develop an effective corporate plan, the Australian Democrats moved nine amendments to the Bill. What happened? When the division was called all Liberal Party and National Party senators voted against them.

Again in line with industry requests to introduce a two-tiered scheme, the Democrats moved three amendments to the Dairy Produce Market Support Levy Bill 1985, and all were defeated, negatived by the votes from the National Party, the Liberal Party and the Labor Party after the Nationals had expressed sympathy for the amendments and presumably for an industry that was going under. Similar sorts of things have happened to meat export charge legislation, dried fruits levies and drought assistance producer Bills going back to 1982. In each case Democrat amendments aimed at assisting the industries concerned-industries which are of tremendous importance to the economy of South Australia-were defeated when Liberal and National Party senators, whether they were in government or in opposition at the time, voted against them. People must wonder why honourable senators, who introduce the sort of matter of public importance that has been introduced today, behave in that way.

Mr Peacock said some time ago that it was in order to let the Prime Minister (Mr Hawke) hang himself, which is somewhat akin to the comments made by Senator Dame Margaret Guilfoyle, but it does nothing to help the industries concerned. A recent memorandum from the Liberals ad hoc tax committee indicates that their stance is still along these lines. Under the heading relating to a capital gains tax it states:

There is considerable concern amongst Liberal Senators that the Coalition may oppose the capital gains tax and defeat the Government. This would provide an issue from which a double dissolution may ensue. This is perceived to benefit the Democrats.

I interpolate here that I do not see why. It goes on to state:

Some will vote--

that is, some of our own Liberal senators-

to support capital gains tax if the bill appears to be in danger.

And presumably any other money Bill. I say in closing that if South Australia has indeed been disadvantaged by the tax policies of the Hawke Government it has been with the connivance of all Liberal and National Party senators. Since Senator Hill introduced this by saying that it was in fact a debate aimed at the next election, I suggest that all South Australian electors should remember on 7 December and afterwards that the tax burden they are currently bearing is due to votes from both the Labor Government and the Liberal-National Party coalition.