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Wednesday, 27 November 1985
Page: 2345

Senator MacGIBBON(12.30) —My next question about numbers deals with the reserves of the Australian defence forces. Evidence was given before the Committee on 12 September. Since that time nearly two months have passed. I was wondering how the monitoring of the advertising campaign for recruitment to the Army Reserve is proceeding. By way of information, the establishment for the Reserve is 30,000 members and the Committee was told that at 30 June 1985 the number of members of the Reserve stood at 23,772, of whom only 15,565 were efficient. That is a rather serious state of affairs considering that when the Government came to power the relevant figure for August 1983 was 33,000 members of the Reserve; it was 3,000 over strength.

My next question is whether the Government will consider reversing its decision to tax the payments to reservists. One has only to talk to members of the Reserve to find out that the most unpopular feature of the present terms of service is the taxing of reservists' payments. Reservists are not paid anywhere near the same rates as members of the permanent defence forces; they are paid very much on a discounted basis, but previous legislation provided for their payments to be tax free. This is very important to reservists because many of them are self-employed, small businessmen and such people. When they go to camp for one month a year, it is important that they be reasonably well paid and be able to hire locums or people to replace them as managers to run their businesses while they are away. Most of them probably have above average incomes and pay tax at the top marginal rate. They are now taxed on their Reserve payments, which become part of their aggregate income for the year, and they simply cannot afford it. The Government has persisted with the belief that taxation has nothing to do with terms of service. It has put in a compensating factor but that compensating factor simply does not work. I ask the Minister: Is the Government prepared to see reason on this matter and to reconsider its decision with regard to the taxing of reservists' pay?

I raise one final matter on the issue of Reserves. A paper came this week to the sub-committee on defence matters of the Joint Committee on Foreign Affairs and Defence. It listed the resignation rates from the Army Reserve from 1982 to 1984 and the recruitment rates. Putting those figures together, in 1984, which is the latest year which we have information, the output from officer training units, both officer cadet training units and university regiments, totalled 235 officers, yet for the same year there was a loss of 453 officers. In other words, we are losing about twice as many officers as we are gaining. The Army Reserve has many functions but its principal role is the training of officers and junior leaders in case we have an emergency and have to expand the armed services very rapidly. The value of officer training and non-commissioned officer training cannot be overestimated in the functions of the Army Reserve. In view of these figures, what proposals does the Government have to address this net loss of officers, and presumably of NCOs?