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Wednesday, 4 December 1985
Page: 2936

Senator MISSEN(5.44) —I rise to speak on a number of tax Bills including the Taxation Laws Amendment Bill (No. 4) 1985. I do not propose to speak in detail about individual aspects of the Bills. I have already made a speech in which I indicated my attitude generally to the taxation package. It is set out on page 1973 of Hansard of 17 November 1985 in the Appropriation Bills debate. I stand firmly by the ideas and principles which I then expounded.

Mr Acting Deputy President, earlier today I heard you read to the Senate a considered statement by Senator Dame Margaret Guilfoyle made in 1983 when we considered the possibilities of piecemeal amendment to financial legislation. Senator Dame Margaret Guilfoyle, speaking on a tax Bill, stated:

I should say that this legislation is, coincidentally, brought before the Senate during the Budget session and, in some sense, there would be those who would describe it as Budget legislation. In general terms, I believe that it is accepted that a government is entitled to expect the passage of normal Budget and Budget-type legislation and other legislation that is an essential part of its financial program. However, there will be rare occasions when an opposition will feel compelled to reject or substantially amend such legislation, within the constitutional limitations of the Senate, where it is demonstrated to be capricious and arbitrary or vindictive legislation or where it creates new tax burdens of a retrospective kind.

I ask honourable senators to particularly note the words `In general terms I believe that it is accepted that a government is entitled to expect the passage of normal Budget and Budget-type legislation and other legislation that is an essential part of its financial program'. I stand by those words. In the last election I was elected to this place on that basis. I see no reason to depart from it now. I understand that that declaration to the Senate was reaffirmed by the shadow Cabinet of the Opposition about three weeks ago. No doubt Senator Messner will correct me if I am wrong but this principle has been applied quite recently in regard to the child care legislation. It is good and sound reason for behaving as an opposition and not as a government in exile. Therefore I propose to continue to follow this principle.

My views are known to my colleagues and to the public generally. For many years they have known that I have the greatest fear of this country returning to a 1975 situation. I would not do anything that would cause that not to happen. I will not vote against any part of the tax package. I do not believe it is the Opposition's role to do that. Today I have listened to very interesting speeches. Senator Peter Baume spoke of the inadequacies of the legislation in relation to poverty traps. Senator Knowles gave some very interesting facts about the problems that the entertainment industry will face because of this legislation. Senator Jessop spoke, among other things, about the motor car industry and the way in which it has been affected. I have no doubt that those things are true and they are reasons why an opposition should vehemently criticise proposals which the Government puts forward.

This is not a very good tax package. I am sorry that some time ago the Government removed from consideration a more severe tax package which would have widened the range of tax liability which would have been imposed on people in this community and took a different course. I disagree with that. Some of my colleagues feel very strongly about these matters. It is possible for them to say that they would restore these provisions or change them when they get into government. I think that should be carefully considered because one does not know the economic situation that faces a government when it comes into government. I think that is the appropriate course; not necessarily of the same value are voting gestures in the Senate.

I have believed very strongly over the years that the Senate must not overplay its role. The Opposition in the Senate should not act as a government in exile. It should set out quite clearly what it intends to do and from time to time make proper criticism of measures in any tax package. Making piecemeal objections and trying to vote out some parts of a measure is not a wise course. Senator Messner referred to throwing out the `nasties' but leaving in the `goodies'-the tax reductions and things of that sort. I think the people of this country will not be confused by that. Of course, it means that if we do not agree to throw out something, people will be at the Opposition at all times to know why we did not choose their particular objection and throw out. For these various reasons, I shall not be voting against the tax package. I understand that it will be supported by a majority, including the Australian Democrats in this case. I do not propose to vote at all on the amendments or on any substantive vote against the package.

During this debate, the Democrats have been greatly criticised. They have affirmed strongly that they have had some successful ventures with the Government and have changed the package. I think that they are not very substantial changes. But I rather feel that the Democrats do not understand the place which they hold and which the Senate holds in the scheme of government. I want to read some things that have been said at various times. On 23 February 1982, for example, in the Senate Hansard is recorded a firm statement by Senator Mason, then the Deputy Leader of the Australian Democrats. Speaking of the sales tax legislation he said:

We can legally reject Supply Bills but what would be the long term implications of such an action? A respectable view can be put forward that the right of any government, including a Labor government, to create a Budget and govern is inviolable.

He then concluded:

Listen to this, senators, it is my bottom line. Those on the Labor side in particular should listen to this. Undesirable though the sales tax increases are, damaging though their impact might be, the consequences of the Senate meddling in or unilaterally rewriting a Budget seem to us too horrifying to contemplate.

They are admirable sentiments but, unfortunately, within six months the Democrats had changed their mind on that legislation. Earlier, the Democrats also swore statutory declarations as to what they would do. There was debate about this. In the 1980 election campaign, when they put down these declarations, they swore them on Bibles. I am always suspicious of people who swear things on a stack of Bibles and feel that they have to do that. I think that one's statement should be sufficient in itself. However, they gave an undertaking that they would not use their voting numbers `in such a way as to cause the blocking of Supply or money Bills in a manner which would prevent the majority party in the House of Representatives from governing'.

Strangely enough, the Democrats had another expression in their declaration, which went on to say that each senator undertook thus:

. . . shall never during my term of office as a Senator contribute to or cause a situation which through blocking of supply or money Bills might bring down the Government.

Since then there has been quite a bit of talk about the blocking of Supply. I think that Senator Chipp has said at various stages that this is not a blocking of Supply. We know that `Supply' means the Appropriation Bills which cover about 40 per cent of the money which the Government receives, and, of course, other income is necessary for it to govern. One often hears, among various politicians, the reference, `Oh, this is not a Supply Bill', or, `This is a Budget Bill', or, `This is not a Budget Bill', or, `This is a tax Bill', or, `This is a money Bill'. Honourable senators will remember the carefully thought expressions in Senator Dame Margaret Guilfoyle's statement about matters which are part of the financial problem of the Government, the getting and spending of moneys, particularly the getting of moneys, which are all to be covered. It is not possible to differ in this pettifogging way with Supply Bills and make a principle based on that.

I must query two recent Press statements issued by Senator Chipp. One was about capital gains tax, as a necessary part of the whole tax package. He pointed out with some feeling that he had received from a journalist an idea that certain coalition senators could still abstain or cross the floor to ensure the passage of a capital gains tax for the sole purpose of denying the Democrats the possibility of a double dissolution.

Senator Chipp —That is a minute of your own Party's taxation committee meeting.

Senator MISSEN —No, this is Senator Chipp's Press statement--

Senator Chipp —It is taken verbatim from a minute of your own taxation committee, chaired by Senator Messner.

Senator MISSEN —Yes, I know the minute about which Senator Chipp is talking, an admirable minute--

Senator Chipp —A shameful minute.

Senator MISSEN —No, on the contrary; it set out very sensible statements; that we should not act in any way to appear inconsistent in what we do and should not attack only `nasties'. I found the minute quite admirable. The problem is that it was not followed.

Senator Chipp —I can't follow you, in view of that statement.

Senator MISSEN —I am talking about Senator Chipp's statement. He said that he heard of this from a journalist.

Senator Chipp —No. I have a copy of the minute.

Senator MISSEN —I am sorry. I am reading from the honourable senator's Press statement, and that is what he said. Maybe it is not true, but the honourable senator said it.

Senator Chipp —I said it all right.

Senator MISSEN —Yes. The point I am making is that those of us who see principle involved in this do not see the only principle as being to stop the Democrats getting a double dissolution, much as I know the Democrats feel that they need it. We see a much more important principle than that. Senator Chipp went on to say:

I now challenge Mr Howard to state categorically that under no circumstances will any Liberal Senator contribute to the passage of a capital gains tax by absenting themselves, abstaining from a vote, or crossing the floor.

That is a very curious remark, especially as Senator Vigor has said this morning that he will vote independently, as he feels he must. Senator Chipp has probably forgotten the platform of the Liberal Party, of which he was once a member, which says that to carry out our principles we need members of parliament responsible to their electors alone and not subject to direction by people or organisations inside or outside Parliament. So I find it very strange that Senator Chipp should be criticising Mr Howard in this statement because some of his members were doing as their platform states.

Senator Chipp —With his concurrence.

Senator MISSEN —They were not doing it with his concurrence at all.

Senator Chipp —Mr Howard is saying publicly that he is opposed to a capital gains tax, yet some of your senators are conspiring to vote for it.

Senator MISSEN —No, Senator Chipp is quite wrong. There is no conspiracy about this. He knows very well that in our Party room we announced what we will do and there is no conspiracy whatsoever. If we feel in conscience bound to take a certain course, we take that course. But I must refer to another Press statement made by Senator Chipp on 10 November, in which he spoke about his firm pledge not to block Supply.

Senator Chipp —You are giving the Democrats a lot of publicity in drive home time. Thank you, I am very grateful.

Senator MISSEN —I am glad that we are all happy about this, Senator. In that statement, Senator Chipp said:

In that significant position, we have never at any time threatened to block supply. We gave our word not to block supply and we will not, under any circumstances, break that promise.

Then Senator Chipp went on to say:

This does not mean that we will not amend any form of money Bill. We have amended tax legislation for instance, when we successfully prevented the Fraser Government from imposing taxes on necessities of life; clothing, footwear, shelter, books and newspapers.

Senator Chipp —That's right; I am very proud that we did that.

Senator MISSEN —Just a moment. I am trying to read it all, Senator, so that you cannot say that I am in any way distorting it.

The ACTING DEPUTY PRESIDENT (Senator Jessop) Order! Senator Missen, I should like you to address your remarks through the Chair.

Senator MISSEN —I am much happier to address my remarks to you, Mr Acting Deputy President. The statement continued:

Amending tax legislation is fundamentally different from blocking supply. Examining tax legislation is part of our responsibility to scrutinise all legislation and amend it where appropriate.

That is a complete misconception of the Senate's job. Supply is only a word. It is the significant financial legislation of the Government that is of concern and the same principles should apply. I do not regard what might almost be called a type of blackmail, standing over the Government and getting some concessions, as a desirable thing in the interests of parliamentary government as we know it.

I turn from that to say that, finding that unsatisfactory, I listened with some interest today to the various remarks made about the Taxation Laws Amendment Bill (No. 4). I have indicated that I do not propose to vote on that. But so far as I am concerned, the removal of the--

Senator Chipp —So you are going to abstain?

Senator MISSEN —Yes, I shall abstain and I shall not be alone in that. Many of my colleagues would like to do likewise, I think, but maybe they will not feel able to do so. The removal of the deduction for entertainment expenses is something which the Government has estimated will bring in $310m in the first full financial year. That is a very substantial amount. It is a balancing item for the Government in relation to the amounts given in the tax package. I do not see the logic of ignoring that balance that is a substantial figure. Whether there will be a great loss of jobs is, of course, not certain. An article in the Age of 22 November 1985 states:

. . . job vacancies notified to Commonwealth Employment Services in October represented the highest number for any month since October 1984.

It says that the number of vacancies in the entertainment industry was great. I know that this is a time when the entertainment industry gains a great deal. It is very busy before Christmas. The article goes on to suggest that the effects may be more considerable among the unskilled, who will lose jobs in restaurants. I can certainly say that I, along with many other people, feel that it is very unfortunate that the Government has not found a means whereby it can distinguish between a completely genuine entertainment deduction and what is, as various people have said, a rort. Undoubtedly, a lot of this money is paid by pay as you earn taxpayers. People on ordinary incomes are paying for the expense of the entertainment and the lunches that are provided.

I notice that such a law does not exist in the United Kingdom. In any event, I am by no means certain that the expenditure in question is necessary for the gaining of income. In fact, a lunch of sandwiches might be better for the general health of the people concerned than the lunch which is at present consumed by some people. Nonetheless, I think it is a pity that the Government has not been able to find some means of distinguishing between what is a genuine expense and what is not. I do not think it is the role of the Opposition to find those means. It is the Opposition's role to criticise and it is for the Government to put forward legislation and, if necessary, correct it when it gets the chance to do so.

I see some defects in this legislation. At the same time, I think it is a matter for which the Government must bear responsibility. It must face the people for it. If we as the Opposition re-write the Government's Bills we take on responsibility for its Bills and, if they fail, we may be blamed for it. I think it is misreading the role of the Opposition to expect it to do that. I think that overall many of the criticisms made today are justified. There are no justifications which I believe, in the words of Senator Dame Margaret Guilfoyle on behalf of the Opposition some two years ago, justify our voting against the package. I think the Government would be well advised to consider whether it ought to alter some of the regulations and some of the terms of the legislation before it is too late. Nonetheless, I believe that the Government has substantially the right to adopt its financial programs. That has been my view throughout my time in this Parliament. I will abstain from voting on this group of Bills.