Debate resumed from 21 October.

The Hon. I. M. MACDONALD [12.44 p.m.]: It is indeed a pleasure to address the House in relation to the Governor’s Speech, which was read in this Chamber in September. The Speech clearly outlined the Government program leading up to the next election. All honourable members would have to agree that the program is comprehensive and strong and it meets the needs of the people of New South Wales. Just as the Government over the last three years has energised this State and put New South Wales in the forefront of national economic planning and development, the Governor’s Speech made it clear that the Government will continue with such policies.

Today I wish to deal with one aspect of the Government’s comprehensive program: industry development, research and development, and the role
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of New South Wales in the national economy. Australia’s level of unemployment is predicted by the Organisation for Economic Co-operation and Development to be 8.2 per cent this year, ranking this country unfavourably in comparison with a number of European and Asian countries. European countries such as Norway have unemployment levels in the order of 2 per cent to 3 per cent. The United States of America rate is around 5 per cent. Those countries are performing better on unemployment than Australia is. I contend that the relatively high unemployment rate in Australia has been caused by our failure to increase research and development expenditure, particularly in the last budget of the Howard Government.

Under the previous Labor Government the budget projection for research and development expenditure following the One Nation package was in the order of $8.4 billion over the following four years. With the rejection of a number of One Nation programs, the figure is now anticipated to be $7.1 billion - a reduction over four years of $1.3 billion. The Hon. B. H. Vaughan, as one of the architects of Labor’s regional development policy which has been so capably implemented across this State, understands that the changes have meant a decline in research. Australian business is now contributing only 0.74 per cent of gross domestic product to research and development. The fall-off in the government sector will have a very adverse impact on development of Australian industry.

Australia needs to be much more export focused. Many of the export advantages that Australia can competitively take on the world stage relate to downstream processing of primary goods and services. Therefore research and development are critical. The Howard Government is dismantling Australia’s research and development effort. It has reduced the depreciation allowance from 150 per cent to 125 per cent for certain research projects. A number of programs have also been abolished. It is this assault on research and development by the Howard Government that over the next decade could have a crippling impact on Australia’s ability to increase exports, particularly into the fast-growing markets of Asia.

The Hon. M. R. Kersten: This is fascinating!

The Hon. I. M. MACDONALD: If the Hon. M. R. Kersten checks my speech in Hansard tomorrow he will find that every figure I have used is accurate. The Howard Government has made a systematic assault on research and development programs, as the Hon. R. S. L. Jones would know. I want to deal with the figures so that honourable members can fully appreciate the accuracy of what I have been saying. Unemployment figures for the 1998 calendar year show that Japan has the lowest unemployment rate at 3.1 per cent. I stated earlier that the figure for the United States was 5 per cent. That figure was slightly inaccurate: the figure is 5.1 per cent. The unemployment rates for countries with economies comparable to Australia’s economy range from 6.2 per cent in Austria and 5 per cent in Switzerland to 4.2 per cent in Norway and 3.5 per cent in Iceland. Australia’s figure is in the higher bracket. Its unemployment rate is 8.2 per cent, which is above the rates for Portugal, Denmark and Sweden and a little less than the rate in Canada. Spain has an unemployment rate of 21.2 per cent.

As I have said on many occasions in this House, the real unemployment level in this country is hidden. A number of restrictions relating to part-time work have been imposed on eligibility both to register for and to receive unemployment benefits. Those restrictions mean that Australia’s real unemployment level is probably well in excess of 8.2 per cent. A decline in the research budget will have a dramatic impact. It will impact on companies that wish to invest heavily in research and development. Michael Porter’s The Competitive Advantage of Nations must rate as one of the major texts of the 1990s on the export focus, the development of manufacturing and the role of innovation and new technology. Michael Porter said:

Firms create competitive advantage by perceiving or discovering new and better ways to compete in an industry and bringing them to market, which is ultimately an act of innovation. Innovation here is broadly defined to include both improvements in technology and better methods or ways of doing things. It can be manifested in product changes, process changes, new approaches to marketing, new forms of distribution and new conceptions of scope.

Michael Porter also said:

Innovation results from organisational learning as much as from formal R&D. It always involves investment in developing skills and knowledge, and usually in physical assets and marketing effort.

He continued:

Firms in an innovation driven economy compete internationally in more differentiated industry segments. They continue to compete on cost, but where it depends not on factor cost but on productivity due to high skill levels and advanced technology.

What Michael Porter was getting at is reflected by McKinsey and Company in its report entitled "The Wealth of Ideas", which was issued a year or two ago. That report said:

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Almost 40% of all emerging exporters attribute their competitive advantage to technology; 28% to having a unique product, and 25% to product design. Of emerging exporters receiving the 150% R&D tax concession, those with the highest export growth rates are also the most technologically innovative . . . The recent study by Statistics Canada found that the most important factors differentiating high growth firms from the rest were their R&D expenditure and inhouse R&D capability.

I know that these sorts of comments are completely beyond the Hon. M. R. Kersten. Dr Peter Sheehan stated in his work entitled "Australia and the Knowledge Economy":

• sustaining a significantly higher growth rate of business R&D could increase the long term growth potential of the Australian economy by around 0.7% per annum (i.e. say from 3.5% to 4.2%).

I am quoting from these texts to confirm my major contention, and that is, as I said at the outset, that the assault on the research and development program by the Howard Government in its last budget will have critical ramifications for the development of an innovative and competitive economy in Australia. To give members of this House an idea of what the Howard Government has done, it firstly abolished the research and development syndication scheme and reduced the research and development tax concession from 150 per cent to 125 per cent. Even when additional funding for the new research and development program, which is called strategic assistance for research and development, is taken into account, support for research and development over the four years to the year 2000 will be cut by almost $2 billion. The other budget cuts that eliminated virtually all of the previous Labor Government’s initiatives announced in the innovation statement, as well as cuts to export marketing assistance and other programs, will also have a negative impact on the diffusion of innovation to a broader group of manufacturing businesses.

Indeed, as I said before, if one compares the promises of the previous Labor Government with the impact of this cut in the tax concession and the elimination of other programs, the reduction is from $8.5 billion to $7.1 billion in 1997 figures. That is a significant cutback in research and development in this country. I believe it will have a long-term impact on the ability of Australia’s exporters to put the necessary innovation and new technology in place to meet the demands of the next century. That is despite the fact that major studies have shown that Australia’s ability in relation to research and development to compete on the international stage is very high indeed. For example, the 1995 study entitled "Benchmarking Australia’s R & D Costs and Skills" compared the annual research and development base costs, including overheads, equipment and consumables for a 30-person research and development facility in Australia, with other major nations. The findings concluded that such a facility:

• would cost $2.4 million in Australia compared to $3 million in Korea and the UK, $3.4 million in Singapore and the U.S.A. and $4.5 million to $6.2 million for an equivalent facility in France, Germany or Japan. Only Malaysia and Indonesia fared better at a cost of $2 million.

In other words, in the overall scheme of things Australia is better able to produce research and development facilities than most of its competing nations. However, while those figures were being prepared the Howard Government was preparing to drastically reduce government research and development expenditure. As I have said, it has a very shortsighted policy indeed and will possibly result in a slowdown in the development of new technology by overseas firms in this country which had based themselves here to take advantage of the various programs under this country’s research and development program.

A number of steps should be taken in an endeavour to convince the Howard Government to change this policy. The first of those steps would be the restructuring of the research and development tax concessions to a level that rewards firms for their efforts. Rather than having a flat rate of 150 per cent for firms seeking a research and development concession a varying rate should be put in place to reward the level of investment in research and development. I hope the Federal Government reconsiders its research and development before the ability of this country to create new industries is dramatically reduced.

For example, the proposal contained in the publication Rebuilding Australia could be adopted. The research and development tax concession could be restructured on a tiered level with firms investing up to 2 per cent of their production in research and development remaining eligible for the current 125 per cent tax concession, firms investing between 2 per cent to 5 per cent of the value of their production in research and development being eligible for a 150 per cent tax concession, and firms investing more than 5 per cent of the value of their production in research and development being eligible for a 175 per cent tax concession.

In that way investment in research and development will be rewarded. Those sorts of ideas and other initiatives are necessary to redress the growing problem in this country of a downturn in
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research and development that was initiated by the program that was introduced in the last Howard Government budget. I urge every member of this House to reject the Howard Government’s appalling treatment of research and development in this country. Companies investing in new technology and innovation must be rewarded by having their tax concessions restored. That will enable Australia to compete in Asia and reduce the nation’s unemployment level.

[The President left the chair at 1.00 p.m. The House resumed at 2.30 p.m]

The Hon. J. P. HANNAFORD (Leader of the Opposition) [2.30 p.m.]: Although the Governor outlined in his Speech the Government’s legislative program, he did not outline a program for recovery of the New South Wales economy, which is in a state of distress directly as a result of the policies of the Government and the lack of direction of the Premier and the Treasurer. New South Wales was handed over to the Labor Party in March 1995 in a healthy financial state; public confidence in the economy was sound. However, things have taken a dramatic turn for the worse. The business community no longer has confidence in the economy and investor confidence is in an appalling state. The Government has shown small business no direction or leadership. The electorate agrees that the Government does not know what it is doing or where it is going; it has no confidence in the Premier. What a telling indictment of the Government.

Universally community groups do not trust the Premier and the Government - a sorry but understandable state of affairs. The Government has no direction. It is prepared to do a backflip on its commitments. The most glaring example of that in recent times was its turnaround relating to the privatisation of the electricity industry. The Premier and Treasurer may be committed to privatisation but they cannot carry their party on this issue. Honourable members will recall the Government’s first backflip: its commitment on the tollways. On 13 occasions the Government has done a backflip on its commitment not to increase or introduce taxes.

I instance the Government’s position on payroll tax. The former coalition Government actually reduced payroll tax. No sooner was Labor in government than it changed the rules to include superannuation within income. As a consequence, this year the Government received an additional $88 million. Despite the Government receiving an additional $2,000 million from taxpayers in the past two years, and despite the promise of a balanced economy and a budget surplus, the Treasurer has briefed caucus that the budget deficit could be as high as $324 million. The evidence suggests, however, that it is likely to blow out to closer to $200 million. What confidence can the business sector and the community generally have in a government that starts the year with the suggestion that there will be a surplus but within six months announces that the State may be facing a budget deficit of $500 million?

The Hon. D. F. Moppett: It is every inch a Labor budget.

The Hon. J. P. HANNAFORD: As my colleague reminds me, the Treasurer said at the time of presenting the budget that it was every inch a Labor budget. Little did we realise at the time how true that statement would prove to be. At the time we were assured that a high-taxing, high-spending approach would not be taken to fiscal control. Little did we realise that the Government would increase taxes and spending to such a level that no discipline would remain in the budget. Obviously the Treasurer no longer retains the influence he exerted within Cabinet over the economic deliberations of this State. Our fiscal policies must give a clear direction for investment. At present there is no such direction. Social policies must be clarified because investment in such programs is in total disarray. The public is entitled to have confidence in our education system, however, the Governor’s Speech contained nothing to instill confidence. Parents in New South Wales have no confidence in the Government’s ability to manage the education system.

The Government must show clear direction, rather than send mixed messages to the community, in relation to the justice system. For example, in another place the Government introduced legislation that will remove the threat of prison penalties from those who possess drugs; the Minister for Health will support the legalised heroin trials in the Australian Capital Territory; and the Premier is not prepared to give an overt commitment to the expansion of drug injection programs, instead he has foisted that responsibility onto a parliamentary committee. Because of these mixed messages, the community is of the view that the Government is not committed to a firm direction in law and order nor stamping out drug abuse problems. The Government is committed to nothing but rhetoric - it is rich in rhetoric, but poor when it comes to delivering on outcomes and substantial policy change.

I commend the Governor for his leadership upon taking office, notwithstanding the controversy
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that surrounded his appointment, particularly the future of Government House. His Excellency has been well received throughout New South Wales. He is highly respected by the community and by me. I commend his outline of the Government’s program but I do not commend the program. It contains no direction, no leadership and no policy; it emphasises that the Government is void when it comes to new initiatives. None were outlined in the Governor’s Speech. In fact, any policies espoused by the Government are adapted from policies and proposals articulated by the Opposition. The coalition is driving policy direction in New South Wales, and that is acknowledged by commentators, interest groups and the community. That situation will manifest itself in the coalition enjoying a clear victory in the elections of 27 March 1999.

The Hon. A. B. KELLY [2.43 p.m.]: It is 9½ years ago that I left this Chamber as a member and 10 years have passed since I made my maiden speech. Obviously I will not be afforded the opportunity of making a second maiden speech. I recall some memorable debates from those days. The Prickly Pear Commission was abolished - a matter discussed at length between the current Treasurer and me. There were problems with cactoblastis. I learnt from my experience as a member in a previous Parliament that your friends in politics are not necessarily on your side of the House and that your enemies are not necessarily on the other side of the House. Nothing has changed in that regard. An Opposition member recently said that no Government member has country New South Wales at heart. I take exception to that statement.

I am pleased to support the Governor’s Speech and the elements of the budget contained therein, particularly as it supports country New South Wales. I refer to the 242 jobs that will be transferred to country New South Wales, which will over time be increased to 400. When the Department of Agriculture was transferred to Orange 500 jobs went to one city. However, on this occasion the jobs will be spread across country New South Wales. I am pleased that Dubbo will receive the highest number of new jobs: 31. It is important that the jobs be spread across rural regions. I am concerned that future census figures will show an increase in the populations of regional centres but, practically without exception, a reduction in the populations of towns with fewer than 10,000 residents. If regional centres are to survive, smaller towns must survive.

This is a Robin Hood budget: it taxes people who can most afford it - for example, it contains a tax on luxury cars, a bed tax and a land tax - and it spends the money on community needs. The doubling of the inner-city parking levy recognises the need to remove private cars from city streets. The increased use of private motor vehicles will be a problem for Sydney in the future. In London and New York buses and taxis make up two-thirds of all vehicles on the road - the reverse is the case in New South Wales.

The budget delivers almost $2 billion in capital works to rural and regional New South Wales, which will create some 29,000 jobs. Honourable members opposite will appreciate the fact that the Government has increased noxious weeds grants by 20 per cent; that is, by more than $1 million. Noxious weeds cost rural New South Wales more than $600 million annually in lost production. The operation of noxious weeds councils has been reviewed recently, in particular whether local government should continue to act as noxious weeds authorities. I am pleased that the Minister for Agriculture has agreed that the councils that wish to retain that authority can do so. In my experience, some councils do a good job with noxious weeds, others do not. By the same token, a number of county councils do not do much to eradicate noxious weeds. Those bodies that perform well in this regard should be allowed to continue to do so. Perhaps the operations should be reviewed to ascertain which bodies are doing the best job.

The budget has allocated $2.5 million to address soil acidity. I congratulate Netta Holmes, a Wellington resident, who has been awarded the honour of Australian Broadcasting Corporation rural woman of the year. Netta’s involvement in soil conservation, soil acidity and tree planting has contributed to her winning that award. The budget provides $18.2 million towards waste management to achieve the Government’s target of a 60 per cent reduction in waste management going to landfill by 2000. An amount of $100,000 has been allocated to a group of councils in the central west and the Orana for a net waste project to try to reduce the amount of waste going to landfill. Honourable members will be aware of the problems that farmers face with rural tips that have been placed in gullies. At the first sign of rain, properties adjacent to the tips are polluted with bottles and garbage.

Last week the Hon. M. R. Kersten referred to the Parental Responsibility Act. I support his remarks. I support Premier Carr’s strong commitment to country New South Wales. He has ensured the continued operation of the Parental Responsibility Act. It is here to stay. Thirty rural councils have indicated that they want the Act initiated in their areas. The Country Mayors Association supports the continuation of the Act.
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Indeed, I am advised that no council in country New South Wales objects to the provisions of the Act. They were trialled in Orange, and they worked. They were trialled also in Gosford, but I am not sure how well they worked there. The review committee had 18 months to review the operation of the Parental Responsibility Act, but it spent only two hours in Orange. I suppose that is why it produced a negative report on Orange. I cannot support the criticism levelled last week by the Hon. Dr Meredith Burgmann last week. She has never been to Orange. In fact, Orange residents liken her to Blaxland, Wentworth and Lawson: the next time she crosses the Blue Mountains will probably be her first time.

Rural areas are different from the metropolitan and coastal areas. They are more defined, and it is much easier for the Act to operate effectively in those areas. I repeat my total support for Premier Carr’s assertions that the Parental Responsibility Act is here to stay. To return to the budget, TAFE will receive over $500 million in funding, of which $38 million will be for capital works. The area in which I live will receive just under $0.5 million to extend the local TAFE, in a deal that was worked out in co-operation with the local council.

In my local area all the significant infrastructure that has been installed in my lifetime has been and continues to be funded by Labor governments, not by coalition governments. Sir William McKell established the Soil Conservation Service in Wellington. Jack Hallam moved the service’s State training centre with its 50 staff to Wellington. The water treatment plant at Lake Burrendong, the largest water storage facility in New South Wales, was established by Sir William McKell. Kevin Stewart was responsible for the new hospital. Bob Debus was responsible for the Wellington Fire Training Centre. Labor governments have funded the building of the high school hall and the Windamere Dam at Mudgee. The only public building that wears a plaque from a coalition Government is that which houses water works. It was opened by John Fahey, but it was funded by Laurie Brereton.

For flood security funding and upgrade works the budget has provided $2.7 million to upgrade dams in six areas. New South Wales has a major problem with floods, and in the past four or five years the Federal Government has provided significant funds for flood mitigation. However, I am sorry to report that in its last budget the Federal Government cut funding for flood mitigation works by more than $7 million. With regard to road funding I am pleased that the Government will continue to provide funding for the Penrith to Orange route. An amount of $60 million will be expended on the Great Western Highway in the Blue Mountains, through Warrimoo, Faulconbridge and Hazelbrook. The Dubbo to Newcastle link will continue to be upgraded by the Carr Government - that is the western link to the Hunter region, the region which needs our support.

The Government has provided $100,000 for design work for the very well named Renshaw-McGirr Way, which is the road between Parkes, the birthplace of Sir James McGirr, and Wellington, the birthplace of Jack Renshaw. The Premier recently announced that, provided funds are available from the sale of certain electricity assets, $30 million will be forthcoming for the IMC project at Parkes. The budget provides also for an increase from $9.3 million to $11 million for regional development. In contrast to the State Government increasing the regional development budget by 20 per cent, the Federal Government has scrapped the $150 million infrastructure project to regional New South Wales, which in my view was a particularly good scheme.

In my local area the Government provided funding of the order of $2 million for a cypress pine plant at Gilgandra. The Government provided $2 million towards a $50 million gas infrastructure project to Parkes, Forbes, Peak Hill, Narromine, Dubbo and Wellington. It is proposed that the line will extend to Mudgee and Tamworth and will bring many jobs and hundreds of millions of dollars in investment to the region. The Minister for Energy wholeheartedly supports the gas pipeline.

I now refer to the sales tax exemptions on intergenerational transfers of rural properties. There is a popular misconception that most farmers are wealthy people who drive Mercedes Benz cars. These days 80 per cent of people in rural New South Wales are trapped by their assets. They have been left an asset that is no longer capable of producing an income.

The Hon. J. H. Jobling: And they probably cannot sell it.

The Hon. A. B. KELLY: They cannot sell it, and their children cannot make a living from it. They are trapped with little income and nothing to pass on to their children. It is very difficult to charge them tax on an intergenerational transfer, and the Government has abolished that tax. I am pleased
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to again be a member of this House, and to be part of the club.

The Hon. A. B. MANSON [2.55 p.m.]: In commenting on the legislative and financial proposals of the Government as presented by His Excellency Governor Gordon Samuels on 16 September, I take this opportunity to comment on the current wage campaign being conducted by the Construction, Forestry, Mining and Energy Union. The union’s claim is for a reasonable 15 per cent wage increase from 1 October 1997, with a 3 per cent increase every six months for the next two years. In addition, the union is campaigning on behalf of building workers for company productivity payments that realistically reflect project values.

The union is also seeking fair superannuation and redundancy payments as well as extra insurance protection, top-up workers compensation insurance and 24-hour accident insurance. Importantly, the union is seeking compulsory occupational health and safety inductions and improved occupational health and safety standards to counter what is historically a dangerous industry. The issue of employers not paying correct workers compensation premiums is a continuing problem for the industry. The union will ensure that those employers who follow the rules and correctly quote the true number of workers on their sites will not be forced to pay for the fly-by-nighters who rip off the system.

The union is campaigning hard in regard to apprentices and youth unemployment. The union wants more jobs for unemployed youth and is campaigning for one apprentice for every five tradespersons on a job. No doubt some members opposite will repeat what their corporate backers say when they speak of the injustice of this claim: "What about the national interest? This is destroying jobs." We have heard it all before. Building workers are asked to think about the national interest while some employers put profits ahead of jobs. But in the same breath the conservatives and the corporate construction executives vote themselves massive salary increases.

The national interest can be interpreted in many different ways. One major construction executive is so interested that he takes home over $4 million a year as part of his salary package while the average building worker would have to work for 120 years to earn the same amount. That is what is setting this country back, not the ordinary workers who want a fair day’s pay for their labour. Building workers are working harder than ever. Their labour productivity is the best in the world and company profits are the highest in a decade. I take this opportunity to quote some company profit statistics that may shed some light on the extent of the concern of these companies for the national interest. Boral Ltd made a net profit of $403 million in the last financial year, an increase of 96 per cent. Devine Ltd’s pre-tax profit of $11.2 million was an increase of 110 per cent on the previous year. It had a net profit increased by 117 per cent. Its revenue has increased by 89 per cent.

Walkers, another large construction company, had a pre-tax profit of $25 million, an increase of over 50 per cent, and its net profit rose by $16.5 million. Evans Deakin was able to manage its national interest in such a way that its pre-tax profit rose by 47 per cent to $28.9 million and its revenue increased by 158 per cent to $822 million dollars. It appears as though Leightons is comfortable and relaxed with its 88 per cent increase in net profit, which added $2,927 million to its total revenue, which is up by 22 per cent. Mirvac is definitely no worse off, with its $30.3 million net profit for the last financial year. An article by Brad Norington in the Sydney Morning Herald on Monday 14 October 1997 which covered the construction union’s current wage claim quoted Mr Peter Barda, chief executive officer of the Master Builders Association, as saying that he agreed with the construction unions. The article states:

They are not seizing on the Olympics - it is equitable.

The article then states:

The cost is not unreasonable overall.

Referring to what construction might follow after the Olympics, Peter Barda said:

I’d expect an underlying trend of demand and room for growth in marketing and tourism - hotels and resorts - which put pressure on infrastructure, development for roads, civil engineering and sewerage. As the baby boomers get older, I’d also be expecting high levels of aged care accommodation and retirement dwellings.

No doubt the Construction, Forestry, Mining and Energy Union campaign will ensure that the most qualified and experienced building workers across Australia will be attracted to Sydney to ensure that the jobs are finished on time. The construction union in this instance is simply an instrument of the market forces. The construction union makes no apology for this, given the attack on workers being carried out by the Howard Federal Government and its conservative State colleagues. The union is asking for a concerted effort from employers to fix youth unemployment by taking on apprentices, an area in which they have not made such a spectacular
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impact. The union is asking for a fairer share of the profits and a social contribution towards addressing unemployment problems. At present there is a skill shortage. If we train young workers everyone will be better off. The construction union has conducted itself in this campaign in a responsible, well-disciplined and tactically sound manner.

The Hon. R. S. L. JONES [3.03 p.m.]: Last Saturday I spent the afternoon with an Australian legend - Tom Barber. Very few people in this House would have heard of Tom Barber and his lovely wife, Aline. I met Tom and his wife in 1977 when they were preparing to go on their first Greenpeace expedition to Albany, Western Australia, to try to close down the whaling station. We were the first to establish a Greenpeace presence in Australia. Tom Barber, an architect by trade, tried at that time to create a wind farm in Australia but found that there was no demand and received no encouragement from anybody. So he went to California and in 1980 created the world’s first wind farm. That wind farm was owned by Zond Corporation, which in turn was taken over by Enacon.

Since those early beginnings wind power has become extraordinarily popular globally. Germany will be producing 25 per cent of its energy capacity from wind power within the next few years; it is one of the world’s fastest growing markets. The second fastest growing market is India. I have an Internet document entitled "Wind capacity in India" which reflects the increase in wind-power capacity in megawatts for the past three years. It has risen from 71 megawatts in 1993 to 180 megawatts in 1994 and 773 megawatts in 1995. India and Germany have discovered wind power, but Australia has not. The small wind farm located in southern New South Wales is just experimental. Germany, India, the United Kingdom and other countries are solving their greenhouse problems by producing sustainable energy from wind power. The world market for wind power is growing extremely fast, by approximately 50 per cent from $1 billion a year in 1994 to $1.5 billion in 1995, as over 1,200 megawatts of new wind-power plants were installed.
Market activity was centred mainly in Europe and India, and opportunities are now emerging in Asia and Latin America. Activity in the United States of America is expected to increase in the next several years as a number of new projects are in the development phase. Wind power has become cost competitive with other power generation technologies as economies of scale achieved with larger turbines and more efficient air foils, better machine configuration and control systems have dramatically reduced wind power costs. In fact, wind power is now slightly above coal-fired energy production and about one-third the cost of nuclear energy production. There is the pathetic spectacle of Australia and its Prime Minister being isolated globally because the Federal Government supports the coal companies and the fossil fuel energy companies. Australia started the first wind power farm. It has now created a wall of wind, which is three times more effective than the single turbines that are usually operated. According to an article by Worldwatch Institute:

. . . wind turbines installed on less than 1% of the land in the 48 contiguous states could provide 20% of current U.S. power needs. Global wind energy potential is nearly five times current global energy use. Wind power cannot fully replace fossil fuels . . . but it has the potential to exceed 20% of world electricity provided by hydropower . . . More countries have wind power potential than have large resources of hydropower or coal.

So why is Australia falling so behind with wind power? We have the world lead in solar technology and it is likely that that technology will go overseas if and when Pacific Solar and Pacific Power are privatised. That will be regrettable. We had to go overseas to prove that wind power worked. No doubt will have to go overseas to prove that solar power works. In 1994 the recently reunified Germany surpassed Denmark as the world’s second largest wind energy powerhouse. By the end of 1995 Germany will exceed 1,000 megawatts of installed wind capacity and by 1988, if not sooner, that country will outstrip California, long the world leader in installed capacity. During 1994 wind turbines in Germany generated about one terawatt-hour - 1,000 million kilowatts - of electricity, and during 1996 it produced nearly 2.5 terawatt-hours. That is an indication of how extraordinarily fast the industry is growing.

Wind power is now cheaper than nuclear power and gas power and is a whisker away from being cheaper than burning coal. When India steps up its production of turbines, wind power will be cheaper than burning coal. To meet greenhouse targets, which have not yet been set, Australia should be looking at wind power generation of electricity and getting on line as quickly as possible Martin Green’s technology at the University of New South Wales. Australia could easily meet its greenhouse targets if it has the will to do it. Because the House is not sitting next week, I will truncate my speech and mention only one or two other matters. An interesting article from the Electronic Telegraph on the Internet on 5 October stated that Marks and Spencer in London had announced that eggs from battery hens would be banned from sale
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in all of its stores from 6 October; it is the first major high street retailer to ban that form of factory farming. Also, Britain’s new junior agricultural Minister, Elliot Morley, MP, said:

We have to accept that the present battery system (for laying hens) has to go and has to go on a European wide basis.

The European Union’s 15 heads of government agreed at an intergovernmental conference in Amsterdam on 16 and 17 June that animals should be legally recognised as sentient beings, thus acknowledging that they are living creatures capable of feeling pain and suffering. A legally binding protocol recognising animals as sentient beings has been annexed to the Treaty of Rome, the cornerstone of European Union law and binding on all EU countries. Once again Britain and Europe are way ahead of Australia in their attitude towards animals. The United Kingdom even has a Minister for animal welfare, a concept Australia would not consider. In a recent court case in Canberra, G. R. Henshaw v Patricia Ellen Mark, Lynda Stoner, Margaret Mary Setter and Mark Anthony Pearson, concerning Parkwood Eggs, which was run as a business to produce and market eggs, allegations were made that battery farming for eggs is inherently cruel. In his summing up, the magistrate said:

However, it is impossible not to be overwhelmed by the evidence presented, and I am satisfied of two things:-

(i) producing eggs by means of battery farming hens is inherently cruel to the hens, and

(ii) Parkwood Eggs were no exception to the finding in (i).

He said further:

The subsequent investigation by Animal Welfare, a government department, gave the "all clear" to Parkwood Eggs. The investigation is best summed up by Mr Humphries in his letter dated 15 September 1995 to the A.F.P.:

" . . . the firm alleged to have kept the hens in breach of conditions tolerated by law has been investigated and the report shows no breaches have occurred".

The phrase "conditions tolerated by law" is interesting. As I understand it, Animal Liberation are saying, and have been saying for many years, that the law ought not tolerate such conditions. This is the very point they were making, and it was missed by the minister, and apparently by the press.

The magistrate found those charged with trespassing not guilty because their trespass did not cause harm to others, a drop in production, interference with work or damage, and did some positive good by helping obviously sick hens. I am pleased that since that case the Australian Capital Territory has banned the production of battery eggs. I hope that this Government becomes aware of what is happening in the United Kingdom, in particular, and in Europe in general, and follows their lead. For example, recently in a press release the Department of Health in the United Kingdom finally announced that red meat causes cancer. I have said that in this House for many years but, unfortunately, honourable members appear to have no understanding that meat is the number one cause of cancer. The press release, entitled "COMA Report on Diet and Cancer", states:

The Committee on the Medical Aspects of Food and Nutrition Policy met yesterday to consider the final recommendations of their report, the "Nutritional Aspects of the Development of Cancer". Following that meeting, Frank Dobson, Secretary of State for Health, with the full support of Jack Cunningham, the Minister for Agriculture, Fisheries and Food, issued the following statement:

"Jack Cunningham, Tessa Jowell and I discovered on the afternoon of 19 September that the report’s recommendation for the level of consumption of red and processed meat at which consumers should consider reducing their intake had not been discussed by all the members of the COMA committee."

It goes on to talk about the committee’s recommendations, which include:

* to maintain a healthy body weight and not to increase it during adult life;

* to increase intakes of a wide variety of fruits and vegetables;

* to increase intakes of dietary fibre from a variety of food sources;

* the average consumption of red and processed meat should fall; those with intakes at or above the current average of around 90g/day . . . should consider a reduction; and those with high intakes above around 140g/day . . . should reduce their consumption.

Clearly, the Ministry for Health is very conscious that meat does cause cancer. Evidence on the subject in international papers indicates that it is the number one cause of cancer in humans. The British Department of Health and the United States of America cancer council have made an announcement, but we have heard not one word spoken in this country, certainly not in New South Wales, on the detrimental effects of eating meat, dairy products and eggs because, basically, the meat lobby is too powerful. An expert report entitled "Food, Nutrition and the Prevention of Cancer: A Global Perspective" commissioned by the World Cancer Research Fund and the American Institute for Cancer Research states:

The foods we choose play a major role in most of the significant health problems we face today. Heart disease,

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diabetes, stroke and cancer are but some of the illnesses with direct links to dietary choices. Researchers now estimate that 40 to 60% of all cancers, and as many as 35% of cancer deaths, are linked to our diets.

That is not news to those of us who have been studying the subject for years. But it certainly is news to most people who are suffering from prostate, breast or bowel cancer as a result of their consumption of red meat. Finally the American Institute for Cancer Research has advised people that the eating of meat does cause cancer. The report received short shrift in the media here - almost no coverage in the Daily Telegraph and only a little more in the Sydney Morning Herald. Fundamentally the message is being ignored by Australian health authorities and politicians, who mostly eat red meat. Australia has a long way to go before we catch up with the United Kingdom, Europe and the United States of America. It depresses me that we are falling so far behind in so many areas, whether it be energy, diet or animal welfare. We should be looking at what is happening overseas and try to emulate them to a degree because Australia is sinking into the mire and becoming a larger version of Tasmania.

The Hon. HELEN SHAM-HO [3.19 p.m.]: In speaking on the Address-in-Reply to the Governor’s Speech delivered at the opening of Parliament on 16 September 1997 may I first say how wonderful it was to see Parliament opened in all its splendour and glory. I congratulate everyone responsible for organising the day. Despite all the media’s criticism of the opening, the day’s events were appropriate and in keeping with the protocol practised and followed for similar events all over the world. It was an opportune time for the people of New South Wales to hear for themselves first-hand what the Government intends to do in this session. It was the first time since this Australian Labor Party Government came to power that I had the privilege of attending such a ceremony. It was appropriate and I found it most enjoyable.

I take this opportunity to express my grief and sadness over the death of Diana, Princess of Wales, and the sad loss of another giving and wonderful person, Mother Teresa. Their love for humanity and their determination to make the world a better place were reflected in their actions and their will to connect and communicate with people. Their loss is great and has sent shock waves around the world. I extend my sincere condolences to their families and friends and all those who were touched personally by them in their lives. During the parliamentary recess another tragedy befell the people of New South Wales: the Thredbo landslide. The rescue workers attending the scene should be commended on their brave efforts and their amazing rescue of Stuart Diver. They displayed admirable sensitivity and determination. I express my heartfelt sorrow to the victims of the landslide and their family and friends. I agree with the Governor’s identification at the end of his Speech of the three issues which will test the success of Australian democracy in the future. They were:

The capacity of the Commonwealth and State governments to work together in a true federal spirit; genuine progress towards Aboriginal reconciliation based on justice and respect; and, leadership in the never-ending fight against intolerance and ignorance.

A wide range of issues was raised in the Governor’s Speech but today I shall comment on only a few. As a former member of the Standing Committee on Social Issues I was involved in investigating youth violence and sexual violence. Violence perpetrated against women in the privacy of their own home, whether it be sexual or otherwise, is hidden from the public eye and from public scrutiny. The Government’s establishment of a council on violence against women is good. However, I suggest that the Government should not forget the plight of women of non-English speaking background. Often the needs and concerns of NESB women are left out of the equation and no special consideration is given to taking into account their unique position in the community. I urge the Government to consider setting up a special section of the council - or to move through another channel - to specifically service the needs of women of non-English speaking background who have extra needs.

Last year in Parliament I raised the issue of domestic violence in the Vietnamese community, informing the House that in the past decade domestic violence has been the cause of 10 deaths in the Vietnamese community and that Vietnamese women felt that domestic violence was accepted and almost condoned by Vietnamese men. This is just one example of the way in which cultural differences impact on the issue of violence. These are things the council on violence against women must be aware of if it is to deal with this community problem adequately and comprehensively. I do hope that the Government will take this into consideration.

The Governor mentioned that the Government is working with rural and regional communities to promote the creation of long-term, quality jobs. That may be the case, but in slashing services to rural New South Wales the Government is actually destroying jobs and destroying the lives of people who rely on those jobs. One example I can cite is the cuts in rail services to country areas. I have
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already raised them with the Treasurer at question time. As I have said, the Balranald Council is opposed to the change as 1,700 jobs will be lost over the next three years, leaving only 24 staff to service Countrylink travel centres and six staff at Countrylink stations. Such cuts have outraged affected communities such as Balranald. The Government should be concerned about the impact that its cutting of services will have on individual communities. The Government must take measures to minimise the hurt and the negative effects the cuts will have on country communities.

The Governor stated that New South Wales continues to lead Australia’s economic growth and business investment. I am worried, however, that the edge that New South Wales enjoys could be lost under the current Government. There is no doubt that New South Wales is not taking full advantage of its natural resources and opportunities. Since the Carr Government was elected in 1995 it has destroyed many of the gains made by the previous coalition Government. I support what the Leader of the Opposition, Peter Collins, said in the other place, that one of the biggest problems facing New South Wales under the Carr Government is the risk of financial mismanagement. When the Carr Government came to power 2½ years ago it inherited a healthy economy. New South Wales had the lowest tax rate of any State in Australia, attracting a lot of private sector investment and creating employment opportunities.

The Premier, far from keeping his promise not to introduce any new taxes or increase any existing taxes, did both. Tax revenue in New South Wales under the Australian Labor Party has increased by 19 per cent, representing a tax rise of $1,000 per family per year and an additional tax take of $2.35 billion a year. One example of the Government’s financial mismanagement can be seen in the disastrous budget brought down this year. Terry McCrann of the Daily Telegraph described this year’s New South Wales budget as a "disgracefully irresponsible exercise leaving NSW residents paying much higher taxes than they should". The Commonwealth Grants Commission noted that New South Wales spending remained well above that of other States. In contrast to New South Wales, Victoria reduced taxes by $200 million.

As I said, the Labor Government has broken its promise: it has imposed new taxes and increased existing taxes. It increased poker machine tax and introduced the bed tax, both of which have cost the State hundreds and thousands of jobs. Both of these taxes have met with widespread community opposition. I remember the angry rally and demonstrations that were held outside Parliament House at the time the tax changes were announced. For local clubs the poker machine tax increase will mean that prices will rise, jobs will go, club debts will grow and building improvements will be shelved. This will hurt the battlers - families who use clubs for family entertainment. Local clubs and their members will suffer under the tax increases.

My office was inundated with letters protesting against the tax increases. The people are outraged and upset about the increases. Clubs are not just an institution; for many people they are a way of life. They bring people together and encourage them to become active and to contribute to the community. The tax increases will impact on many facilities that clubs provide. They will affect many community services sponsored by clubs. Taxes paid by clubs are already the fourth largest category after stamp duty, payroll tax and land tax. No other organisations pay more tax than clubs, which are the largest taxpayers of all business and individual taxpayers in New South Wales, in both absolute dollars and as a percentage of the total. There is no doubt that the poker machine tax increase will have a harmful and detrimental effect not only on local communities but also on the club movement, which does not have the capacity to pay the increase without severely affecting jobs, community support, poker machine capital replacement programs, and building and refurbishing projects.

Another tax which will impact negatively on the State’s economy is the 10 per cent bed tax on hotel accommodation in the central business district and some north shore areas, which is an opportunistic move by the Government which will cost jobs. The Minister for Tourism promised 18 months ago that "the State Government will not introduce a bed tax" - another empty promise by the Government. What an embarrassment for the tourism Minister, Brian Langton, who I think is a decent and nice person. The tax is vigorously opposed by the tourism industry. Its fears of a serious detrimental effect were immediately realised after the budget was announced, with $220 million reportedly being wiped off the value of tourism companies on the stock exchange. On 9 May the Sydney Morning Herald reported that "half the $80 million loss on Wednesday was sustained by four major Sydney hotel companies". The Government wants to capitalise on the upcoming Sydney Olympics. However, there is a real and serious danger that the bed tax could backfire.

Bruce Baird said that the 10 per cent tax would result in a 10 per cent fall in demand for rooms in the city. It is estimated that 60 per cent of
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consumers would change their travel plans to avoid or reduce the effects of a 10 per cent bed tax. The Sydney Morning Herald of 7 May reported that Bruce Baird also said that the Carr Government was promoting the industry with one hand and strangling it with the other. With 4.2 million international visitors expected to travel to Sydney next year, the Government is trying to have them stay elsewhere. Isn’t that stupid? Tourism is the State’s biggest revenue raiser, generating $15 billion a year for the New South Wales economy and creating thousands of job opportunities throughout the State. At present New South Wales has captured the lion’s share of the domestic market, with a third of all holiday nights spent in the State. However, the bed tax threatens to diminish our lucrative tourism market, and the Carr Government should be condemned for introducing it.

The Opposition has promised to abolish both the bed tax and the poker machine tax if it wins government in 1999. I do not believe that an increase in taxes has helped to alleviate the State’s main problem, that is, unemployment. I want to comment finally on State development. New South Wales has a great deal of potential to increase tourism and trade with the Asia-Pacific region. The former coalition Government has already taken steps in the right direction. Flourishing tourism and trade would make balancing the books a great deal easier, and would take the burden off the people of New South Wales when it comes to revenue raising. Promoting tourism would make good sense and would be sensible financial management. However, I do not believe that the Government has the initiative or vision to turn this potential into reality.

The Government should promote Sydney as the gateway to Asia. By virtue of our proximity to the Asia-Pacific region, and the large number of multicultural residents in this State, Sydney is increasingly being regarded as an operations base for the entire Asia-Pacific region. That has been proven by the influx of large global companies such as American Express, Estee Lauder and British Aerospace. Sydney needs to promote this image and encourage more international companies to make New South Wales their headquarters. The Government is not acting aggressively to encourage them to do so.

New South Wales has a great deal of potential for trade with countries in the Asia-Pacific region. The State has a great many industries with potential for export development such as food processing, communications, information technology, processing of raw materials, business services, education, health, environmental industries and waste management, construction services, infrastructure and many more. These are complementary to the import needs of the rapidly developing countries in the Asia-Pacific region.

The Government needs to do more to develop this relationship. It certainly will not happen by itself, and many other States and countries are anxious to break into the Asian market. As noted by Professor Wolfensohn, President of the World Bank, who was recently presented with an honorary doctorate at the University of Sydney, the economies in Asia are growing rapidly and can contribute greatly to Australia’s own economic performance. For example, China increased its real per capita gross domestic product by 250 per cent between 1978 and 1994. Professor Wolfensohn also pointed out that 10 years ago Japan was the only country in Asia which had a larger gross domestic product than Australia. He predicted that in five years this will include China, India and Indonesia, all of which are growing at a rate of 9 per cent a year, whereas Australia may grow at a rate of only 3.5 per cent a year.

The importance of the Asian market was highlighted by the trip to China earlier this year by the Prime Minister, John Howard. He was accompanied by a high-level business delegation that was heavily weighted with representatives from the service and manufacturing sectors. The big growth potential for trade between our two countries is in mineral and agricultural products. Last year exports of those products represented 56 per cent of Australia’s $3.9 billion exports to China. China’s voracious manufacturing sector is hungry for quality inputs, that is, raw materials and primary resources that New South Wales can provide. Increasing exports of these products would have very real benefits for regional New South Wales.

China is likely to be our third largest trading partner by the year 2000, with exports doubling to around $8 billion. New South Wales should position itself as one of the key providers of these exports. However, the Government budget has not provided any funding to expand the number of overseas officials representing New South Wales for trade purposes. Victoria has 22 representatives across Asia and is reaping great results. Victoria is now almost receiving a bigger share than New South Wales. New South Wales has only three representatives across Asia. I call on the Minister for State and Regional Development, although he is not present in the Chamber, to put New South Wales in a more competitive position and to adopt a more pro-active strategy. State development must become a priority to take full advantage of the opportunities offered by the Olympics. At the start of the new millennium the
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spotlight will be on us. Yet there is no Government strategy to spin off economic growth from the Olympics; there is no blueprint for development. We must act quickly to ensure that there will be a legacy from Sydney’s two weeks on the world stage. Unfortunately, the Government has no vision and is not pro-active.

The Hon. C. J. S. LYNN [3.36 p.m.]: It is a great honour to contribute to the Address-in-Reply to the Governor’s Speech, and I compliment Governor Samuels for reverting to his traditional role of opening the Parliament and presenting the Government’s program for the scrutiny of honourable members. I commend the Governor for his reference to the recent death of the Princess of Wales and Mother Teresa of Calcutta. He also paid a fitting tribute to the outstanding rescue operation of the State Emergency Service volunteers and other members of emergency services at Thredbo. I join all other members of this Parliament in endorsing his comments.

I also welcome the Hon. A. B. Kelly to this House and look forward to joining him in debate on the issues facing our State. It is appropriate that I pay tribute to the Hon. Patricia Staunton, whom I regard as a person of great talent and a particularly forceful and forthright personality. She was an asset to this Parliament in the short time she served as a member. The coalition’s worse nightmare would have been realised if Labor had given due recognition to her talent and provided an opportunity for her to obtain a seat in the other place. She would then have been in a position to assume the leadership for Labor at a critical time in the lead-up to the next election. I was relieved that the Labor Party did not try to dissuade her from leaving, as the coalition does not want any change in the current leadership of the Labor Party leading up to the next election. I wish the Hon. Patricia Staunton every success in her new appointment to the magistracy.

When one examines the circumstances surrounding the election of the Government it is easy to understand why the Governor’s Speech was so short on vision. The election strategy for Bob Carr could have been extracted directly from Graham Richardson’s books: do and say whatever it takes to win. I felt the Governor’s Speech was probably more significant for what it did not say. For example, there was no mention of the Government’s proposal to reduce parliamentary representation in the Legislative Assembly by six seats. The argument the Government has used to justify this proposal is equally as fallacious as the promises it made to reduce the hospital waiting lists by half, to drop the tolls on the M4 and the M5, not to privatise the electricity industry, and not to raise taxes.

I understand that the cost of establishing a twenty-first ministry is about the same as the savings that would be made by reducing the number of electorates from 99 to 93. If the Government were half serious about savings to the taxpayer, it could have initiated a change which would have increased the productivity of its members without any additional cost. One of the reasons advanced by the Government for the creation of an additional ministry was to relieve the workload of the Minister for the Olympics, the Hon. Michael Knight. The fact is that it had nothing to do with Michael Knight’s workload at all. It was a deceitful ploy to allow the Labor Party to win government in 1999 with as little as 47 per cent of the primary vote. If the Government were serious about ministerial workloads and proper parliamentary representation in its electorates, it would have adopted the solution I have been advocating for some time.

When the honourable member for Campbelltown, Michael Knight, elected to desert his electorate and move to the plush surrounds of the north shore in the exclusive suburb of Roseville, he forfeited any pretence of being an effective local member. I am sure he thought the Government would only serve one term and therefore sought to ingratiate himself with the International Olympic Committee. I have recently read a book entitled New Lords of the Rings, which is an exposé of the history and workings of the IOC. I have no doubt that Michael Knight will fit in well with that organisation, given the changing values and allegiances he has demonstrated in his political life. Michael Knight did not only physically desert his Campbelltown constituents with his move to the other side of the harbour, he also deserted them mentally when he installed himself as President of Sydney Organising Committee for the Olympic Games. I contend that there was no need for him to assume that role as numerous people in the private sector are well qualified for it.

It seems that Bob Carr was not prepared to stand between Michael Knight’s personal ambition and the needs of his constituents. Michael Knight now has three full-time jobs but he can afford to do only two. One does not need to be a Rhodes scholar to decide which role he discarded. His obligations as Minister for the Olympics, Minister responsible for the Paralympics and Minister responsible for Darling
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Harbour occupy all of his time. The Sydney Olympic Games 2000 is the most important global event of the year and no doubt issues will arise that will demand the complete attention of the Minister as the State prepares for the event.

The presidency of SOCOG is also a full-time job. Indeed, it was deemed to be so important that the former coalition Government was prepared to pay hundreds of thousands of dollars a year to attract the best candidate from private enterprise for the position. The politicisation of the position with the arrival of the Carr Government meant that the type of people needed for the job would not touch it with a barge pole. Indeed, the appointment yesterday of Mr Milton Cockburn as the media chief to SOCOG is further evidence of the politicisation of the Sydney 2000 Olympic Games. Mr Cockburn was an adviser to former New South Wales Premier Neville Wran, a former officer in the Federal Labour Department, and private secretary to former Labor Minister Clyde Cameron.

The Sydney Olympic Games are in danger of being known colloquially as Richo’s games because of the influence of that great Labor manipulator, Graham Richardson. It was Richardson who engineered Michael Knight’s desertion from the left-wing faction to the right-wing faction of the Labor Party. That cleared the way for Michael Knight to gain the Olympics ministry and eventually the presidency of SOCOG. When one looks at the Labor network of appointments in SOCOG, one can only speculate about the degree of influence of Graham Richardson, who was himself a Labor appointment to SOCOG.

The job of the local member in an electorate such as Campbelltown is a full-time one. A review of Michael Knight’s press clippings over the years provides numerous examples of his trying to create a sinister kind of class warfare between the battlers of Campbelltown and the silvertails on the north shore. He made many claims that Campbelltown missed out on its share of resources at the expense of more affluent suburbs. To a disinterested observer the problems he identified would require an enormous amount of dedicated work from a local member in government to ensure that Campbelltown gained any appreciable benefit. Soon after he was elected to the ministry he gathered up his family, along with his goods and chattels, packed them into his ministerial limousine and headed north to join the very silvertails he had berated for so long. He made a token gesture of being a local member by retaining a clayton’s electorate office in Campbelltown. The end result is that Michael Knight has effectively abandoned the very people who elected him to represent them to live with the silvertails and to work with the bigwigs at the big end of town.

If the Premier, Bob Carr, is fair dinkum in his belief that the battlers out in the western and south-western suburbs should have local parliamentary representation, he should call an end to the farce being played out by Michael Knight. He could do that by arranging for him to be nominated for a position in the New South Wales Legislative Council. That would allow him to focus totally on his ministerial responsibilities and his self-appointed position as President of SOCOG. He would not then be distracted by having to nick out to Campbelltown every now and then for a photo opportunity for the local newspapers. Premier Carr should then arrange for the Hon. P. T. Primrose, a former mayor of Campbelltown, to be elected as its local member.

The Hon P. T. Primrose: I live in Camden, the same as you do.

The Hon. C. J. S. LYNN: I would find it odd if the Hon. P. T. Primrose actually defended Michael Knight. I know the Hon. P. T. Primrose lives in Camden, but I do not see him out there very often. He does not have any distractions and his family lives in the area. He would be free to devote himself entirely to the electorate and address all of the problems Michael Knight identified when he was in opposition but ran away from as soon as Labor came to office.

The Hon. R. D. Dyer: On a point of order. The Hon. C. J. S. Lynn appears to have an obsession with the Hon. Michael Knight, where he might or might not reside, and whether he adequately represents his electorate. I realise that the Address-in-Reply debate usually encompasses a wide range of topics. However, it is stretching things a little to suggest that there is any reference in the Governor’s Speech, even tangentially, to the place of residence of the Hon. Michael Knight or the extent to which he represents his electorate. I seek guidance as to whether the Hon. C. J. S. Lynn is in order in addressing, not in a passing fashion but at great length, matters relating to the personal activities of the Hon. Michael Knight.

The Hon. J. H. Jobling: On the point of order. As the Minister has said, the debate is wide ranging and all encompassing. The topics covered in the Governor’s Speech deal with issues, many of which impact upon the electorate to which the Hon. C. J. S. Lynn is referring. I contend that he has every right to deal with these matters and, indeed, the failure of the Government, through one of its members, to correctly address those matters. On that
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ground alone I suggest that the honourable member is in order and should be allowed to continue.

The Hon. C. J. S. LYNN: On the point of order. My obsession is with the people of Campbelltown, not with the Hon. Michael Knight. If he were to move back to Campbelltown to represent his electorate, I would not make any further mention of him. I am now dealing with issues in Campbelltown that I believe need the attention of the local member.

The DEPUTY-PRESIDENT (The Hon. J. R. Johnson): Order! Contributions to the Address-in-Reply debate are usually wide ranging. However, it is stretching the patience of the House to regurgitate a speech made last night on the adjournment debate. The Hon. C. J. S. Lynn should address his remarks more closely to the Address-in-Reply.

The Hon. C. J. S. LYNN: As I said, my obsession is with the representation of the people of Campbelltown. That farce could be ended by the Hon. Michael Knight being nominated for a position in the Legislative Council. That would allow him to focus totally on his ministerial responsibilities and self-appointed position as President of SOCOG. The Hon. P. T. Primrose, as a citizen of Campbelltown, as a former mayor of Campbelltown and someone who lives in the area, would be free to represent the people of Campbelltown. There is no doubt that Campbelltown needs effective parliamentary representation to address some urgent problems. The most pressing of those problems is drugs. Local police from Campbelltown have been seconded to fight the serious drug problem in Cabramatta. That operation has been so successful that it has forced drug dealers in that area to disperse. One area they have re-established themselves in is Campbelltown. It is now commonplace for people working in the central business district of Campbelltown to find used syringes and to witness drug deals being conducted in broad daylight with relative immunity.

With the drug problem comes the crime problem. I have had first-hand experience of that problem as I and members of my family have been victims of crime seven times since moving to the area in 1981. Statistics released this year reveal that Campbelltown has one of the highest crime rates in New South Wales, including a number one rating for the number of malicious damage reports in the State and the second highest rate of assaults. It also has the second highest rate of break and enters recorded from 164 police patrols. The Governor did not refer to this problem, which is being experienced by one of the largest growth areas of Sydney, and he did not announce any effective measures to address it.

The Governor also referred to an unprecedented growth in health care funding. However, residents of Campbelltown are waiting patiently for vital equipment that is desperately needed to save lives. Only last month the Coroner questioned the status of equipment at Campbelltown Hospital and recommended that a CT scanner be acquired for the hospital before another death occurs. I find it inconceivable that a hospital servicing the needs of an electorate the size of Campbelltown does not have a CT scanner. On 6 November 1996 honourable members learned of the tragic death of a father from Rose Meadow, Mr David Wafer, who suffered a cerebral haemorrhage. His condition had not been diagnosed at Campbelltown Hospital. Mr Wafer was only 39 years of age and he left a wife, Belinda, and three children to fend for themselves.

In August the Coroner made a host of recommendations that highlighted the urgent need for funding and attention to health care in the south-west. Earlier this month a 57-year-old Minto man, Mr Mervyn Hansen, fell ill and was transported by ambulance to Campbelltown Hospital, where he received treatment for a migraine and was sent home. The next day he was again taken to hospital for an X-ray, which did not detect any problems associated with the headaches and sickness he was suffering. It was reported in yesterday’s Sydney Morning Herald that a doctor told Mr Hansen that he required a CT scan to provide detailed information about his brain. It was not possible for him to have the scan at Campbelltown because, despite the recommendations of the Coroner, there is still no scanner at the hospital. Mr Hansen was eventually admitted to Liverpool Hospital, where he underwent emergency surgery for a burst aneurism.

Would the hospital be without a CT scanner if Michael Knight and his family still lived in Campbelltown? The fact is that Michael Knight does not live in Campbelltown and the hospital does not have a scanner. It is not good enough. The Governor’s Speech did not provide much hope for the people of Campbelltown. That is no surprise from a Government that deceived the people of New South Wales by lying to them about lifting the tolls on the M4 and M5, about halving hospital waiting lists, about not increasing taxes, and about plans to privatise the electricity industry.

It is obvious from the Governor’s Speech that the Government no longer believes its own propaganda. Nothing in the Speech created a sense of hope, vision or direction. One only has to travel to Victoria to experience the energy and State pride
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that is being generated by a Premier who provides leadership and vision for the State. A couple of years ago Victoria was almost bankrupt; it is now leading the way. In the new millennium New South Wales will stage the greatest global event in the year 2000, but New South Wales has no vision, no leadership, and no direction. I hope the Government sets about addressing these issues. If it does not, perhaps next year the Governor will be able to provide a sense of direction to a Government that is badly in need of it.

The Hon. Dr MARLENE GOLDSMITH [3.53 p.m.]: I want to firstly address the statements in His Excellency’s Speech regarding the Government’s determination to meet fully its core responsibilities in the State’s health, education, transport and police services. I also want to address the claim that New South Wales continues to lead Australia’s economic growth and business investment. It was extremely naughty of the Government to put those words into the mouth of the Governor. The Government's track record does not reflect those statements at all. What was the Government referring to when it talked about the strength of the economy? Was it referring to an underlying State budget deficit of about $450 million at a time of unparalleled economic strength nationally? Was it responding to constant political crisis during the past year by throwing money at transport, health and education to buy political peace, but with no results to show for it? Was it referring to the fact that State budget outlays are estimated to increase at twice the rate predicted in last year’s budget, 4.5 per cent instead of 2.2 per cent?

Massive amounts of money have been wasted on excessive wage settlements and staff numbers, but not one extra service has resulted from Labor’s budget-breaking binge in New South Wales. At the same time, the Carr Government, to disguise this spending spree, has relied on savage revenue escalation with tax receipts increasing 5.8 per cent rather than the budgeted 3.7 per cent. Is the Government unaware of the Victorian Chamber of Commerce report, among others, that demonstrates that New South Wales has lost the top spot in economic performance, with the Carr Government being the heart of the problem? The Carr Government’s performance has produced an incredible trifecta of excessive reliance on business taxes, excessive growth in tax take and excessively increased government spending.

Labor claimed that it could simultaneously deliver an on-time and on-budget Olympics, balance the State budget, cut the State deficit, cap spending and raise spending on priorities such as health and education. The results of that claim are now obvious to all. We can all judge how well the Government has lived up to those promises and how efficiently it now provides key services, whether it be the daily lengthening traffic jams, overloaded trains, a rail system that is halted hourly, schools where students fall behind the world and Australian pace, courts working at half capacity and overstretched hospitals. I could go on. They are signals of poor and worsening public services under Labor at a greater cost to us all. It is no wonder the State is losing out to Victoria, as it has been since the Carr Government came to office. What a turnaround on the performance of the previous Government!

In his Speech the Governor referred to student literacy. The Speech made much of the funding for the State literacy strategy. I have a question for the Government. How can it assess literacy when there is no way of assessing accountability in the long term? In the United States standardised examination results go back more than half a century. Australia, particularly New South Wales, has nothing like that. The former coalition Government introduced the basic skills test, which was a start. The test has been retained, not without a battle, in a somewhat truncated and limited form. However, there is still nothing of a standardised nature at the end of schooling. I hope that the new higher school certificate will do something to alleviate that problem. As an educator I am concerned that there is no standardised testing, no way of assessing whether the money being spent on literacy is being spent on programs that actually work. I would argue that the funding is still far from enough when so many of our young people are not learning to read or write.

Many of our young people have been consigned to a life of illiteracy even though year after year it has been evident to those on the frontline, to parents and to students themselves that the programs have not worked. Those programs are still being pushed by people in the system because there is no way of proving that the programs do not work as testing has not been allowed. Why? Because the New South Wales Teachers Federation, the friends of the Labor Government, has never allowed its members to be accountable. Sooner or later we must get serious about education in this State, a portfolio that consumes almost a quarter of the State’s budget. Tests must be available to ensure that money is being spent appropriately and achieving the intended results.

The Governor’s Speech was remarkable for what it did not include, such as any commentary on
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the privatisation of the electricity industry in this State. I look forward to finding out what will eventuate. What a fiasco! The Government’s program has been rejected by its own party, as so many of its so-called initiatives have been by the community and by the Opposition. There will be more of the same in the future. The Governor also referred in his Speech to the establishment by the Government of the Child Protection Enforcement Agency to target paedophilia and child abuse. What about the prevention of child abuse? Anything that can be done to deal with child abuse after it has happened is, of course, necessary.

Pursuant to sessional orders business interrupted.