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Thursday, 19 September 1996
Page: 3579

Senator MacGIBBON —My question is directed to the Minister for Communications and the Arts. I ask if he is caught up by the statement made by Senator Schacht in the debate on the recent Telstra urgency motion in this chamber that the profit of Telstra went up 31 per cent between fiscal year 1994-95 and fiscal year 1995-96? Is there any substance for that claim at all?

Senator ALSTON —Yes, Senator Schacht is quoted as saying that profit after abnormals had risen by 31.1 per cent and, indeed, he is correct. There would not be a company in Australia today that would mind being a sheltered workshop if its profit went up by 31 per cent.

What Senator Schacht does not understand is that you do not use these sorts of numbers to make comparisons between years, because the whole point of abnormals is that they are one-off. Telstra itself conceded that this is not the right number to use for comparisons. Here is what Frank Blount said—and I hope you will take this down:

In some respects this figure is a little flattering, because it's about 30 per cent higher than last year. In fact there's been a turnaround of abnormals of about $770 million. Last year we were down more than $550 million because we made a superannuation provision. This year a change in our depreciation methodology has bumped us up by $200 million. The number you should use for comparisons year on year is profit after tax but before abnormals.

Telstra did not report that figure, but it can be calculated. Indeed, BZW, Senator Schacht's favourite investment bank, says that profit after tax before abnormals was $2.1 billion in 1994-95—up by two per cent, not 31 per cent. According to BZW, overall a two per cent profit growth is not very encouraging.

So it is quite clear that Senator Schacht still has not the vaguest idea about how one measures profitability in the marketplace. It is very disappointing that he simply has not been prepared to do his homework on this or a number of other issues. As we know, he is still getting around to asking someone to do a ghost draft of his submission to the ABC, to the Mansfield inquiry. About the most he has been able to contribute to this debate so far is that he put out a press release on 1 September apologising for inadvertently referring to Donald McDonald as `Donald Donaldson'. He told the press to `please amend his statement'. He apologised for any inconvenience. That is a pretty good contribution to the ABC debate.

I was even more perturbed when I was surfing the Net the other night once again to discover that, when you look at Senator Schacht's home page, the last update is 22 February 1996. What do you find there? You find all sorts of goodies, Madam President. Senator Schacht's is listed in his capacity as Minister for Small Business, Customs and Construction, so time stands still for this lot. Senator Schacht says, `If you want to know what we've been up to, you can go to my home page and see the hot issues area.' What happens when you go to the hot issues area? You get one of the best one-liners of all time: `Labor's reality versus John Howard's rhetoric. If you would like to have your say, click here.' You really cannot get much lower than that. He has not got time to update his home page; he has not got time to do any work on his ABC submission; and, he can't even get the name of the ABC chairman right. What is he doing? Why doesn't he go and see BZW and get a sensible briefing, and then he will have an understanding of this issue?

Just in case you might like to start doing a bit of research, what you will find, for example, on the issue of privatisation is that a good friend of yours, Nelson Mandela, has made a useful contribution on the subject. What he said recently was this: `Privatisation is the fundamental policy of the ANC and it's going to be implemented.' That really says it all, does not it?

If only you would go and do your homework. I know it is difficult whiling away those long, lonely hours in opposition but, rather than twiddling your thumbs and playing pure politics, why can't you do some homework? Take a refresher course—or probably, in your case, a primary course—on the basic economics, and you will understand that Telstra's profit performance is not all that good. (Time expired)

Senator MacGIBBON —Madam President, I ask a supplementary question. I ask the minister whether Senator Schacht's financial and economic expertise matches that of proven Labor governments' performance in the past?

Senator Faulkner —Madam President!

The PRESIDENT —Order! The question has to be related to the minister's area of responsibility and can only be answered by the minister—

Senator MacGIBBON —It is self-evident but, since the opposition is so dumb, I thought I would spell it out.

Senator Faulkner —Madam President, I raise a point of order. We had a primary question directed to Senator Alston from Senator MacGibbon about Senator Schacht that I had expected you to rule out of order. I expected you, at some time, to call Senator Alston to order during his answer. None of those things occurred.

Senator Alston —You took a point of order.

Senator FAULKNER —I did not take a point of order. I would now ask you to rule the supplementary question out of order. It is not a supplementary to the non-question asked earlier and I believe that no reasonable person could come to any other judgment than that the supplementary question is out of order and that Senator Alston should be asked to resume his seat.

The PRESIDENT —I believe the question is out of order in that it does not relate to government policy or the government's reaction to other policy or that it is within the minister's area of responsibility.