Full Day Hansard Transcript (Legislative Assembly, 24 November 2000, Corrected Copy)

LEGISLATIVE ASSEMBLY

Friday 24 November 2000
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Mr Speaker (The Hon. John Henry Murray) took the chair at 10.00 a.m.

Mr Speaker offered the Prayer.

LAW REFORM (MISCELLANEOUS PROVISIONS) AMENDMENT BILL

Third Reading

Mr DEBUS (Blue Mountains—Attorney General, Minister for the Environment, Minister for Emergency Services, Minister for Corrective Services, and Minister Assisting the Premier on the Arts) [10.02 a.m.]: I move:

That this bill be now read a third time.

During the second reading debate on this bill yesterday I undertook to seek more advice about the retrospectivity of the bill before the third reading stage. I can advise the House that the amendments in the bill will apply retrospectively to causes of action except for those matters in respect of which a court has given judgment or the parties have entered into an agreement to settle a claim. The amendments affect the amount of damages a plaintiff may receive. The amendments do not remove any cause of action. That is the significant point. As honourable members will recall, the amendments proposed by the bill are model provisions developed by the Standing Committee of Attorneys-General. When that committee considered this matter it was noted that there would be proceedings before the courts that were commenced on the basis of the understanding of the law prior to the decision of the High Court of Australia in the Astley case in March 1999.

Before Astley the conventional understanding was that where a cause of action was in contract and negligence the apportionment legislation would apply and, accordingly, damages would be reduced where there was contributory negligence. The practical effect of the Astley decision is that in cases in which there is concurrent liability in negligence and contract the plaintiff will now recover more than has previously been the case: indeed, more than what some plaintiffs would have contemplated recovering when the action was commenced. Increases in damages awards will flow on to the cost of insurance premiums: for example, higher professional indemnity insurance premiums and increased workers compensation costs.

The amendments apply retrospectively to causes of action to minimise any increases in costs to the general community that would result from increases in damages awards. It is important that there be consistency in Australian jurisdictions with respect to the law of contributory negligence. The model provisions developed by the Standing Committee of Attorneys-General have already been enacted in Victoria and Tasmania. This confirms what I suggested in the second reading debate. The provisions have already been passed by two parliaments and in both Victoria and Tasmania the changes will apply retrospectively, as is proposed in the New South Wales bill. However, to reiterate, the amendments affect the amount of damages a plaintiff may receive; they do not remove a cause of action.

Mr HARTCHER (Gosford) [10.05 a.m.]: I thank the Attorney for his courtesy in obtaining that information and providing it to me and the House so promptly. I acknowledge that the bill is part of a program by the Standing Committee of Attorneys-General to modernise the law, especially in relation to Astley's case. The Opposition has no wish to be obstructive in that respect. The Attorney's assurance that the provisions relate only to the quantum of damages and not to the right to continue action is welcome. Therefore, the Coalition has no problem with the bill being read a third time.

Motion agreed to.

Bill read a third time.

FISHERIES MANAGEMENT AND ENVIRONMENTAL ASSESSMENT LEGISLATION AMENDMENT BILL

Second Reading

Mr WOODS (Clarence—Minister for Local Government, Minister for Regional Development, and Minister for Rural Affairs) [10.06 a.m.]: I move:

This bill makes major reforms to fisheries management in New South Wales. It will guarantee best practice management of the community-owned fisheries resource. It will give us the most accountable and transparent fisheries management framework in Australia. It means better recreational fishing, better tourism and a more stable commercial fishing sector. This bill is good news for the thousands of coastal businesses that rely on our fisheries resource. Ultimately, it will mean more jobs, more economic activity in the regions and a more secure fishing future. In 1999, the Government conducted a review of saltwater recreational bag and size limits. Around 5,000 submissions were received from anglers. Two things struck the Government about this review. The first was how conservation minded New South Wales anglers are—the overwhelming majority of submissions supported a conservation-based scheme of bag limits. We now have the broadest and most conservative scheme of saltwater recreational fishing controls in Australia. The second was the number of submissions that showed unsolicited support for a saltwater recreational fishing fee.

This was not an issue that was raised by the review—there had been no mention at all of a fishing fee in the review paper. Later in 1999 we held a recreational fishing summit. The vast majority of the anglers at the summit supported the idea of a general recreational fishing fee being further considered and asked that a discussion paper on the issue be released. Anglers have supported the concept, in part because of the successful reintroduction of the freshwater fishing fee. As a result, the key planks of the freshwater fee will be translated across into saltwater. All fee revenue will go into recreational fishing trusts. Fee revenue can only be spent on recreational fishing programs, and anglers will advise on trust expenditure through a transparent committee process. Another reason for angler support for the general recreational fishing fee came from the Victorian experience. In 1999 the Victorian Coalition Government, with Labor's support, successfully introduced a general recreational fishing fee.

On 19 January 2000 the Premier and Minister for Fisheries launched the discussion paper "Sustaining Our Fisheries". This paper put forward a strategy for revitalising our fisheries, underpinned by a proposal for a general recreational fishing fee. Simply put, if we can generate revenue we can do more to make fishing better, improve our fish habitat and allow anglers to improve the management of their sport. Around 100,000 papers were distributed—they were downloaded from the web, faxed, posted, hand delivered and emailed. There was 10 weeks of formal consultation. We received nearly 1,000 individual submissions—many of substantial depth and detail—as well as petitions and form letters. The great majority of those who took the time to prepare their own submission supported the principle of a saltwater licence. But the consultation did not stop there.

The Minister for Fisheries from the other place, the Hon. Eddie Obeid, travelled from the Tweed River to the far South Coast talking with anglers, charter boat and boat hire operators, tackle shop owners and fishing clubs. And the message was the same up and down the coast: give us the chance to make things better, let us help improve fishing, and let us help make sure the mistakes of the past do not stop us having a future for our fisheries. Anglers love their sport and are passionate about protecting it for their children. The Minister for Fisheries continued to meet with angling, conservation and commercial fishing groups up until October—to ensure all views on this issue were heard. The statutory advisory councils on recreational fishing, commercial fishing and conservation were also consulted. The proposal is based on this extensive consultation, and significant refinements have been made to the original proposals contained in the "Sustaining Our Fisheries" discussion paper.

The scheme proposed in the bill will require fishers to pay a single fee whether they fish in freshwater, saltwater or both. They will have the following choices: a $5 fee for three days of fishing; a $10 fee for a month of fishing; a $25 fee for a whole year's fishing; or a $70 fee for three years. Anglers will be able to pay their fee by telephone, via the Internet or through a range of agents such as service stations, tackles stores and government offices. There will be annual block fees for charter and hire boat operators, and guides. The block fees were developed in response to concerns that new anglers often use the charter boat and guide industry to gain their first experience and a fishing fee may discourage those beginners. The block fee well start from $100 for operators carrying up to four people, with an extra $25 for every additional passenger up to a maximum of $250 for 10 passengers.

There will be a 50 per cent concession for people fishing in the Tweed River. This is in response to concerns that the fee may impact on that community's tourism trade. The concession is an interim measure only, until Queensland introduces an equivalent scheme. Children up to the age of 18 will be exempt, as will holders of a Commonwealth pension concession card. Adults who are only assisting and supervising children, where there is no more than one rod and line per child, will also be exempt. The current freshwater exemption for Aboriginal Australians, first introduced in 1957, will continue. For saltwater fishing, Aboriginal Australians who are fishing in accordance with their native title rights, or a registered native title claim that they have made, will also be exempt. There will also be provision for certain traditional indigenous fishing activities.

All the money from the fee will go into dedicated trusts. Money from the trusts can only be used for recreational fishing programs. The Minister for Fisheries already has a statutory duty to consult the Advisory Council on Recreational Fishing about policies and priorities for expenditure from the recreational fishing trusts. The advisory council is required to be provided with a draft expenditure budget, and recommendations of the council must be taken into account by the Minister for Fisheries before finalising the budget.

To assist the advisory council with the detail of this process, a committee of anglers will be established to advise on saltwater trust expenditure. This committee will have eight regional members with expertise in various types of fishing. The Nature Conservation Council will also have a member, and there will be members from the major angling groups. This saltwater committee will play a comparable role to the existing freshwater fishing trust expenditure committee, which will continue. Current levels of revenue for the freshwater trust will be maintained for the next five years. After that time, fee revenue will be split between the freshwater and saltwater trusts, based upon the best available information about angling patterns and activities, and in full consultation with angling groups.

I will now deal with recreational fishing areas. One of the ways in which anglers felt their sport could be improved was to adjust commercial fishing. There was a high level of support amongst anglers for fee revenue to be spent on commercial fishing buyouts, but only where there are benefits for recreational fishers. As a result of this community consultation process the Government has decided that recreational fishing areas should be created. Where a recreational fishing area is created, high impact fishing methods could be removed or commercial fishing could be stopped completely, in exchange for fair compensation. An open and transparent process will be established to select those areas. The Government will nominate Lake Macquarie and Botany Bay as the first two candidate sites for the selection process. There will then be a public process calling for nominations of other candidate sites for each of the eight coastal regions.

The expenditure committee will be asked to prioritise the nominations received, and an issues paper will be prepared for each region. Some of the issues to be addressed will include sharing and access issues; the implications of existing recreational and commercial fishing for the resource; options for changes to commercial fishing in the proposed recreational fishing areas; the potential benefits to recreational fishing; the potential conservation benefits; the potential for stock enhancement; opportunities for tourism and the associated economic development; implications for the commercial sector; implications for fish supply and the post harvest sector; implications for the local economy and jobs; and the number of commercial fishing entitlements that would need to be removed and the associated cost.

Draft issues papers will be reviewed by a round table forum, comprising representatives of all the major stakeholder groups, to ensure that all relevant issues are covered. Issues papers would then be released for community comment. An independent person will oversee the community consultation process, to convene public meetings, and to supervise the preparation of a community consultation report. This report will go back to a round table forum of peak stakeholders before being submitted to the Minister for Fisheries, again ensuring that all key stakeholders have input into the process. This selection process for recreational fishing areas has been developed to ensure that the community's social, economic and ecological issues are considered. An advance would be made by the Government against future fee revenue to enable recreational fishing areas to be introduced in sensible time frames.

To achieve the necessary reduction in commercial fishing adjustment to benefit recreational fishing, affected commercial fishers who have most of their fishing entitlements in a proposed recreational fishing area, and have catch history in that area, will be offered a compensation package. If too many fishers wanted to take the compensation package, the fishing businesses bought would be those that offered the best value for money for the trust. It will be necessary to buy back sufficient businesses to ensure two things: first, that each recreational fishing area is implemented in full within the nominated time frame; and second, to ensure that commercial fishing effort does not simply transfer from one area to another. For this reason the Government cannot guarantee that there will be no compulsory buybacks of fishing entitlements, but we do guarantee that fair compensation will be paid for any fishing entitlements cancelled as part of this process.

The Government is proposing that the relevant fishers will initially be offered compensation at twice the value of the fishers' catch history, averaged across their best three consecutive years between the beginning of 1986 and the end of 1999. A fisher who wanted to accept this compensation offer would need to exit the fishery immediately, and could not continue to fish once he or she had been paid. An amount of up to $10,000 would also be available for retraining or relocation, and a further amount of up to $10,000 would be available for accelerated depreciation of their fishing equipment, such as boats and gear. Alternatively, if a fisher decides to continue fishing until the date when the changes are due to come into effect, that is, the sunset date, the compensation package would be based on the market value of the fisher's fishing entitlements, along with the retraining and relocation, and accelerated depreciation payments.

Where entitlements are cancelled under this part of the process, there will be a right of appeal relating to the amount of compensation to the Valuer-General and the Land and Environment Court. The Fisheries Management Act already gives the Minister for Fisheries the power to close fisheries, and revoke endorsements. However, where it is decided to reallocate the resource from the commercial sector to the recreational sector, and create recreational fishing areas, there should be an obligation to compensate any commercial fishers whose entitlements are cancelled by the Government as a consequence. New division 4B of part 2 will not be a new tool for general fisheries management. Sustainability and some sharing decisions will continue to be made under the other relevant provisions of the Act. However, the new division, with its guarantee of fair compensation, will be followed by the Government when entitlements are cancelled to create a recreational fishing area.

I will now deal with management plans and assessments. Earlier this year a group called "Sustainable Fishing and Tourism" challenged a commercial fisher's licence in the Land and Environment Court. The challenge was about whether the Environmental Planning and Assessment Act applied to fishing licences. The court found that commercial fishing was an activity covered by part 5 of the Environmental Planning and Assessment Act. The Government did not appeal this decision. The Minister for Fisheries did not believe that a long, drawn-out and expensive court action would lead to better managed fisheries.

However, after listening to the views of stakeholders, it became clear that amendments to the Environmental Planning and Assessment Act would be essential for us to have a truly meaningful process of environmental assessment. The existing provisions of part 5 of the Environmental Planning and Assessment Act would require us to assess each fishing licence individually. The result would be extremely bureaucratic, costly and time consuming, and would not have allowed a full evaluation of the environmental impact of the fishery. For this reason the bill will strengthen the requirements of part 5 of the Environmental Planning and Assessment Act by requiring whole-of-fishery assessments.

Importantly, the existing environmental safeguards in part 5 will apply to fisheries management. We are proposing to amend the Fisheries Management Act to provide for management strategies to be developed for all recreational and commercial fisheries and for the environmental assessment of these strategies. Our fish stocking and beach safety-meshing programs will also undergo environmental assessments. The Department of Urban Affairs and Planning will establish the guidelines by which my department, New South Wales Fisheries, will oversee the preparation of environmental assessments. The Management Advisory Committees, the advisory councils and the round table forum will all be involved in the process. Once each management strategy and environmental assessment is complete, there will be a public consultation process. The management strategies and their environmental assessments will be publicly exhibited, and all submissions can be reviewed by the Department of Urban Affairs and Planning. This means that for the first time ever the whole community will be able to scrutinise and have input into how our fisheries are being managed.

The Director-General of the Department of Urban Affairs and Planning can ask her department for a report on the assessment, and the Minister for Urban Affairs and Planning will also have the authority to order a commission of inquiry. Ultimately, the Minister for Urban Affairs and Planning will have the power to intervene and to take over the approval role if it is considered necessary. A sensible dispute resolution procedure involving the Premier is proposed to apply in such a situation. The process will be assisted by the RACAC-style round table forum already outlined. This forum will be made up of people with expertise in conservation, commercial fishing, recreational fishing, indigenous fishing, aquaculture, and related industries such as fish merchants and the fishing tackle industry. Representatives from the National Parks and Wildlife Service, the Environment Protection Authority, the Department of Urban Affairs and Planning, and the Department of Land and Water Conservation have been invited to participate in this round table.

The "Sustaining Our Fisheries" discussion paper also proposed a new fishery management model called "Commercial Managed Fisheries". For most commercial fishers in New South Wales the existing share management scheme was too expensive, given the way their fisheries are currently structured. While share management suited the higher value lobster and abalone fisheries, commercial fishers in the other six major restricted fisheries felt that they could not afford the community contribution. In the existing rock lobster and abalone share management fisheries, a community contribution of 6 per cent is being phased in. It represents payment to the community for the perpetual rights given to shareholders to access the community-owned resource.

However, commercial fishers in the remaining six major fisheries also want some affordable secure fishing rights. It is widely accepted that commercial fishers with more secure rights are more willing to take measures to safeguard the fisheries resource for the future. The model in this bill is a lease-style framework, where rights can be allocated for a 15-year period. Because these rights are not perpetual, a rental charge would be payable in lieu of the community contribution. The rental charge will be set at a lower level, consistent with the current economic status of the six remaining major fisheries and the lease-like status of the fishing rights. This new modified version of share management will be called category 2 share management. Unlike the original share management model introduced by the previous Government in 1994, no final shares will be allocated until a full public environmental assessment has been carried out.

When a comprehensive management plan is developed and then assessed as sustainable under the environmental assessment process contained in this bill, final category 2 shares will be issued for 15 years. The bill requires that commercial fishers be given at least five years notice of any decision not to renew shares in a category 2 share management fishery. If category 2 shares are cancelled during the 15-year period, compensation is payable for the value of the shares, in the same way as for category 1 shares. Fishers can move to category 1 share management if a majority of them vote to do so and agree to pay the community contribution. The Minister of the day would not have the power to veto such a decision. This new scheme is affordable. It will give fishers more security and the incentive to manage their fisheries sensibly, because the longer-term value of their shares will depend on the sustainability of the fishery. It gives them the security they need to be able to make sound business and investment decisions.

Over the next five years the Government will develop and implement a fair and transparent cost-recovery framework for category 2 share management fisheries. This framework will be subject to extensive industry consultation. During this period, the total amount of money collected for New South Wales Fisheries, for its existing management services, will not increase without the support of the relevant management advisory committee. After five years, the costs that have been identified as attributable to the industry will be progressively introduced over a further three-year period.

In 1999 the Minister for Fisheries, the Hon. Eddie Obeid, convened a commercial fishing summit to bring together the key stakeholders to discuss the future of fisheries management. This was an election commitment of the Carr Labor Government. Around 200 of the State's commercial fishers attended the summit to discuss the state of our commercial fisheries. The summit provided much of the impetus for the reforms contained in this bill. One of the key themes of the summit was how we could improve consultation with industry.

I am pleased to say that the Government has been able to act on the recommendations of the summit. The bill includes a number of landmark changes to the appointment and operations of commercial fishery management advisory committees. The status of these committees will be upgraded so that they no longer report to the department, but instead report directly to the Minister of the day. The committees will no longer be chaired by a New South Wales Fisheries officer, but by an independent person. These reforms recognise that management advisory committees are an important source of advice on the day-to-day management of our commercial fisheries. The Government has already appointed independent Chairs to the management advisory committees after full industry involvement in the selection process. This bill will make independent Chairs mandatory for future appointments.

The bill also fulfils the Government's election commitment to strengthen existing fish habitat legislation. The bill contains provisions relating to aquatic reserves, dredging and marine vegetation, fish passage, and the importation of live fish. The bill clarifies the role of aquatic reserves and introduces a management planning provision to bring aquatic reserves into line with best practice. Marine parks are large areas with multiple use zoning and are an important tool in habitat conservation. However, they are not always suitable for all areas. Aquatic reserves are generally declared over smaller areas and are declared for specific reasons, such as to protect a particular fish species or a particular habitat, or as an education area. The new management planning provision will enable us to set clear objectives for these reserves, to target management measures at those objectives, to set realistic penalties, and to monitor how well these objectives are being achieved.

The bill contains an automatic requirement for full stakeholder consultation on aquatic reserve management plans. The bill makes it clear that the dredging and reclamation provisions of the Act are focused on the protection of fish habitats and the conservation of biodiversity. The bill improves the definition of dredging and reclamation. At the moment there are several automatic exemptions which mean some activities do not require a dredging permit. Several of these exemptions are being removed as they are no longer appropriate. The bill reinstates an old provision that allows the collection of dead seaweed to be managed properly. Dead seaweed, or wrack, is an important part of the fisheries ecosystem, offering shelter to many small animals, and eventually returning nutrients to the water. We are also improving the wording of the provisions relating to the importation of live fish to restrict the importation of non-native fish species into New South Wales. To protect the migration of native fish we have increased the penalty if a fishway is not built in a lawful manner, and made it an offence to block fish passage by any means whatsoever, without permission.

There are a number of other issues dealt with by the bill. As we move to full recovery of attributable costs from industry participants, it is important that we look for opportunities to make the provision of services more cost effective for industry and the Government. For this reason the bill contains provisions for self-certification in relation to compliance, and enables the use of an accredited compliance auditor to certify that relevant standards are being met. The Government recognises that some recreational fishing competitions can have a significant impact on the resource, and if not properly managed can cause concern to recreational and commercial fishers alike. The Advisory Council on Recreational Fishing is currently developing a code of conduct for these events, and the bill contains a provision to allow appropriate regulation of recreational fishing competitions in the future.

The bill will also allow the New South Wales Fisheries Department to seek a court order preventing repeat offenders from being on certain premises, on a vessel, or in certain areas. This will assist in the fight against poaching and unlawful black market activities. Our aquatic resources are shared by many different users and come under great pressure. Tough decisions need to be taken for the benefit of the whole community. Some groups will not be happy with some parts of this bill. What we have here is a balanced and comprehensive response to the issues facing fisheries management—issues that have existed for more then 100 years and that are finally being faced. This bill means that we will have better recreational fishing, more viable commercial fishing and better resource management as we move into the twenty-first century.

Mr OAKESHOTT (Port Macquarie) [10.30 a.m.]: I lead on behalf of the Opposition in the lower House debate on this bill, on behalf of the shadow Minister for Fisheries in the upper House. The Fisheries Management and Environmental Assessment Legislative Amendment Bill amends the Fisheries Management Act 1994 and the Environmental Planning and Assessment Act 1979 to provide for the environmental assessment of fishing activities, to restructure the management of commercial fisheries, to require recreational saltwater fishers as well as freshwater fishers to pay a fishing fee, to make further provision for the protection of aquatic habitats and to make provisions for many other purposes.

This is extensive legislation and constitutes a complete overhaul of the Fisheries Management Act. That is why, in the upper House, the shadow Minister was eager to expand the consultation process and to allow this legislation to lie on the table for an extended period. Essentially, this is a complete overhaul of the manner in which commercial and recreational fishing operates and the conservation principles that underlie those growth sectors in New South Wales. This has certainly been a hot topic of debate among local communities, particularly in coastal regions. The bill provides for the introduction of a recreational saltwater fishing fee. I gather that fee will become an all-water recreational fishing fee. It is fair to say that at a community and local level, opinion is split on this issue. It is a contentious issue and is being debated throughout many coastal communities. I regard that as a reason for full consultation in relation to this legislation.

The Coalition is concerned that this legislation is being pushed through fairly quickly. That is evidenced by what has taken place in the upper House in the last couple of months. In what many would call an unholy alliance, the Nature Conservation Council and the New South Wales Seafood Industry Council have been suggesting some amendments in the lead-up to introduction of this legislation and regulations associated with this bill. While it may be seen by some as an unholy alliance, I think it is also an indication that there is still broad community concern in many sectors about the direction in which both the Minister and this Government are taking this legislation. If this legislation is about keeping people on board for a future common purpose, certainly the Coalition has many concerns about the crash or crash-through approach reflected in this legislation and the way in which it is regarded by people in many sectors.

As I said earlier, many concerns have already been expressed about that. The recreational fishing fee has attracted a range of views, both for and against, as I said earlier. One of the representatives of a local fishing club in my electorate describes it as a slab-of-beer-a-year fee, and something that is to be promoted if it is going to put benefit back into the community. He does not regard it as a big cost, whereas others view this legislation as affecting a right to fish as a right that should not be taxed. If we are to go down the path of examining the latter line of argument, there will be all sorts of people asking: Who is dropping the line when you go fishing with your child. If nothing is caught, who has to pay? One can get into a whole range of detailed arguments about how some activities may be picked up by this legislation and it becomes incredibly difficult to define. It is a contentious issue.

Although I can see the merits of the slab-of-beer-a-year argument, it is fair to say that among my colleagues I am in the minority. That is why the Coalition will be doing everything it can to oppose the introduction of the new $25 recreational fishing fee. I have brought into the Chamber something that I was given during my term as the shadow Minister for Fisheries. It highlights what is occurring in a range of departments which are the handmaidens of Treasury, including the Department of Fisheries. I received a booklet that is given to a new Minister, which is a summary of the activities of the department and the future directions of the department. It makes for great reading. I have been a member of this House for three years and I am still learning. Documents such as this book are valuable in debate because they provide a full overview of the New South Wales Fisheries Department and the Fisheries portfolio. Importantly, the book also sets out the financial position of the department.

Mr Woods: I did not get one of those.

Mr OAKESHOTT: I will photocopy it and give a copy to the Minister. It is a great document and provides thoroughly enjoyable reading. Perhaps I should circulate a copy to every member of this House so that everyone will know what is going on in departments such as the Department of Fisheries. These days, the departments are the slaves of Treasury. This book outlines quite clearly the full financial position of the Department of Fisheries. In advice to the Minister, it refers to matters such as trust fund allocations. As a result of this legislation, there will be a $30 million a year injection into the trust fund through the imposition of the recreational fishing fee, if everything goes as predicted. It refers to capital expenditure, operating expenditure and assets.

Interestingly, the list of assets includes: research centres and facilities at Cronulla, Narrandera, Port Stephens and Grafton; two trout hatcheries at Jindabyne and Ebor; 50 residences and offices throughout the State, together with a number of boatsheds; two ocean-going fishery patrol vessels—one of which was recently sold as part of an asset-stripping operation; a prime Unix computer system network; minor assets such as marine craft, plant and equipment; computers, a radio network, office and scientific equipment; and audio visual and photographic equipment. It is also interesting to note that 25 items of property—a list of which I have in my possession—have been sold. There has been a nice bit of asset-stripping going on in the Fisheries Department. Honourable members should bear in mind that we are witnessing the introduction of a new recreational fishing fee that everyone in the community is expected to contribute towards the New South Wales Fisheries budget at the same time as asset-stripping is being undertaken. I also wish to refer to the budget process and the situation as at late 1999. I quote directly from this ministerial document, which states:

The reference to "the next financial year" means this year. The document goes on to state:

The next sentence is the key as far as this overall debate is concerned. The documents states:

Without additional Treasury funding, it will be necessary to review activities and/or seek an increase in revenue in some other way.

With the Government about to slug the broader recreational sector along the coast—people who enjoy fishing—with a $25 fee, what will New South Wales Fisheries get from Treasury? Absolutely no help at all. Treasury is being a hindrance by withdrawing funding from New South Wales Fisheries. In respect of the introduction of the proposed new fee, on my understanding of the draft document, the first $1.5 million will go straight into Treasury coffers. I will be interested to hear whether that has changed since the draft document was prepared. That is one more example of Treasury slugging not only fisheries but also the broader community.

This is a dangerous exercise to raise more revenue for Treasury. Treasury should be making a contribution to help pay for activities instead of bleeding fisheries dry. If that is the direction the Government wants to take in regard to the management of fisheries, particularly the recreational fishing sector, let us have a commitment from Treasury. What if that first $1.5 million is not taken by Treasury? What if that $1.5 million is contributed to the trust fund? We have been told that the funds of this new trust will go towards restocking, breeding activities and river bank improvements. Treasury should not simply raid the cookie jar; it should assist the trust fund to do what we have been told it is going to do.

That would be a positive commitment from Government and we would begin to see more commitment on the ground amongst recreational fishers. So far as the relationship between the recreational and commercial fishing sectors is concerned, we have to be particularly sensitive to any legislation, this legislation in particular, being viewed an asset shift from one sector to the other. If true sustainability principles are to be delivered there is the danger—certainly many sectors have expressed that fear—that we are merely shifting assets from one sector to the other. The Minister who led for the Government in this debate represents a strong commercial fishing sector and I am sure he has heard from his community.

Mr Woods: It is the strongest on the coast.

Mr OAKESHOTT: The Minister interjected that it is the strongest on the coast. There will certainly be a fair bit of argument down the coast in regard to that. However, the fear in the commercial sector is that this proposal will do nothing to increase the number of fish in the water or in the river; that all it will do is affect the ability to fish. That view was expressed by the New South Wales Seafood Industry Council on behalf of the commercial fishing sector and should be addressed by the Minister and his officers—the danger that all this bill will do is shift assets from one sector to another. I think every member of this House agrees that we need a viable and sustainable fishing industry for the future, and that unsustainable practices cannot and should not be endorsed and supported. However, we must be sensitive to the fact that this legislation, even though it may be sold as delivering the brave new world of fisheries in New South Wales, may merely shift assets from one sector to the other. I refer again to the good old red book that my CIA officials got for me. They do work well. I agree with the Premier in that regard. They are fantastic handmaidens to have out there.

Mr McBride: You are making a gender comment there.

Mr OAKESHOTT: Take it up with Lawsy! The red book refers to the work of New South Wales Fisheries, and states:

I have no problem with those generalisations. It continues:

I will repeat that—

The last point regarding ecologically sustainable development has been the trigger, to a large degree, for the introduction of legislation such as this bill. On the Manning River we had a particular case that was taken to court. It questioned the appropriateness of some activities in regard to ecologically sustainable fishing practices. It certainly challenged the issuing of licences for unsustainable activities. The case was successful and it came as a shock or surprise to many members of government—and to the Minister. That, more than anything, has been the driving force behind this new legislation. I believe the upper House will deal with licensing. I hope that the House will be able to ensure that future practices are sustainable and that bills such as this deliver on the principles that were challenged in the Manning River case, on behalf of the entire New South Wales fishing industry.

I want to raise one other point—that is, the broad principle of voluntary buyouts versus involuntary buyouts. To a degree, that remains unresolved by this bill and it will shape the success or failure of this legislation. If we are going to see involuntary buyouts, particularly on the North Coast, it will certainly cause grave concern amongst many in the commercial fishing sector. If that is done on the basis of ministerial discretion and nothing else, I believe there will be violent opposition to it. With regard to timing, it is looking more and more like the Minister for Fisheries' election campaign—going up and down the coast, closing particular commercial fisheries and opening new ones and new recreational fishing parks. If that is the approach we are going to see, I believe it will be lost on the broader community and result in violent opposition to the proposal.

If that is the direction the Government wants to take—the direction of involuntary buyouts based on ministerial discretion—I hope that the number one priority relates to sustainability principles: Think of the fish first, take the fishers' position, make sure we see more fish in the water for the enjoyment of all recreational and commercial fishers, and improve fish habitat. I know that the industry body, ProFish, is strongly opposed to involuntary buyouts and would prefer the commercial fishing industry to be restructured based on voluntary options and negotiation rather than with a clash of heads. I hope that is the preferred option of the Government in every area.

This comprehensive legislation completely overhauls the Fisheries Management Act. I hope as much consultation as possible is allowed. I hope that any changes following on from the introduction of this legislation are made. I hope that the issue of sustainability is resolved and that in the future, regardless of who is in government, the sustainability and health of both the commercial and recreational sectors are the key factors in fisheries management in New South Wales—not political campaigning by the Minister of the day.

Mr NEWELL (Tweed) [10.51 a.m.]: The Fisheries Management and Environmental Assessment Legislation Amendment Bill will ensure that our fish resources are more sustainable for future generations to enjoy. Recreational fishing is an integral part of tourism and the regional economy of the Tweed, and that is why I support the bill. Our great waterways and recreational fishing attracts visitors from throughout Australia to the Tweed, especially from Queensland, which generates income and jobs for the local community. This bill will ensure that we continue to invest in the recreational fishery to boost tourism and economic opportunities. This bill introduces a general recreational fishing fee for all inland and coastal waters of New South Wales. The fee will go into a dedicated trust to be spent on recreational fishing programs to make fishing even better. I want to ensure that the Tweed continues to be a favourite holiday destination for Australian families.

This bill was first flagged more than 12 months ago by the Minister. The program of review and consultation that the Minister followed in the past 12 months has been very much appreciated by the fishing community. In particular, I will address consultation in the Tweed community and the reactions to the Minister's proposal. During consultation on the fee proposal a number of local businesses said to me that they were concerned that the recreational fishing fee would discourage Queensland tourists because Queensland does not have a similar fee. Queensland collects a much lower fee—a percentage of boat registration fees—which goes into preservation and development of fish stocks. There is no doubt that at some stage Queensland will move towards the type of licensing system proposed in this bill. Because tourism and recreational fishing are such an important part of the Tweed economy, I raised our community concerns with the Minister for Fisheries, Mr Eddie Obeid.

In January this year the Minister addressed a meeting of a range of stakeholders—commercial operators, outside fishers, commercial operators on the river, members of fishing clubs and so forth—at the South Tweed Leagues Club. They expressed their concerns about the proposals in a very thorough forum. As a result of that meeting, follow-up work was conducted in a separate forum about six weeks later with a representative from the Department of Fisheries and local charter boat operators, who formulated their views into a submission which also went to the review. I congratulate those people who spent almost a full day at a workshop to produce the submission. The charter boat operators pointed out their difficulties with the proposals in the Tweed because of the proximity of similar operators in Queensland who do not pay a license fee. They were concerned about the viability of their economic well-being.

The Government has listened to the legitimate concerns of small businesses from the Tweed, where a special 50 per cent concession zone will apply until Queensland introduces a similar scheme. That means that anglers fishing in the tidal waters of the Tweed River will pay only half the fee—that is, $2.50 for three days, $5 for a month, $12.50 for a year and $35 for three years. A concession also applies to block fees for charter boats, which are an important part of the Tweed economy and often provide the first angling experience of fishers. Charter boat operators will have a choice of having their passenger pay their own fee or they can purchase a block fee of $50 that applies to boats carrying four people, with an additional $5 for each additional passenger, to a maximum of $125 for boats carrying 10 people.

The Government has also introduced a licensing system for the charter boat industry to provide business stability for operators. A fly-by-nighter from Queensland will not be able to come into New South Wales to take advantage of our good fishing and then leave without making any contribution to the resource. The region also has some of our State's best commercial prawn, snapper and mud crab fisheries, just to name a few. Commercial fishers will be given more security under the new category two share management scheme. Commercial fishers will be able to make better business decisions and better long-term decisions for the benefit of the resource.

The Government will also introduce environmental assessments of commercial fisheries to ensure the sustainability of our fishery resource for future generations. I concede that in my electorate, and I am sure in many other areas, there have been a number of concerns from recreational fishers and others which this legislation has substantially addressed. Not everyone will have to pay the licence fee on an annual basis. Exemptions will apply to seniors over 60 years of age, people under 18 and family members supervising other members of their family fishing. Those concessions cover all the stops in relation to complaints made to me when the discussion paper was first published.

Some people felt that a license fee would prevent families from enjoying a recreation that has been passed down in their family for generations. When they learnt that an exemption would apply to members of a family supervising young children they understood that this might strengthen families—that is, encourage them to spend more time at the beach or on the river, wetting a line, supervising their children, enjoying a morning's fishing. I am grateful that this bill substantially addresses those concerns. The Government's bill is about reinvesting into our fisheries resource, and that is good news for recreational fishing and small business in the Tweed. I support the bill.

Mr WEBB (Monaro) [11.00 a.m.]: I commend the Government for attempting to deal with the needs of commercial and recreational fishing and the fishing industry and to assess resources generally. However, there have been several attempts at this and I am not sure that this bill addresses all the concerns and problems of fishers across the State. There has been a lack of consultation with fishers and there is still confusion about whether holders of current saltwater fishing licences need recreational fishing licences in saltwater environs. I understand the Government's dilemma in trying to manage fisheries across the State for a sustainable future, but I believe that many impacts of this bill have not been addressed.

Recreational fishing licences certainly needed reform. New section 34E in schedule 4 details the cost of fishing licences. It will cost $25 for a 12 months recreational licence, which is similar to the freshwater licence, and $70 for a three-year licence. The introduction of the one-month licence at a cost of $10 and the three-day licence at a cost of $5 is welcome, and they will be attractive to tourists. Previously a person fishing for a day or so to try out the sport while visiting New South Wales had to pay $25, a prohibitive fee. However, there are problems, first, with payment and collection of the receipt for the licence; and, second, with the ability of the fisher to hold on to the receipt for two or three days and show it when requested by a Fisheries officer.

New section 34J in schedule 4 outlines offences for fishers who fail to produce the receipt, or who fail to prove that they have a licence for certain period—and the penalties are severe. New section 34J (3) states that possession of fishing gear is conclusive evidence that the person intended to take fish from New South Wales fisheries. I foresee problems with that along the Victorian border and around the Australian Capital Territory for people travelling from one State to another or into and out of the Territory. Confusion could result in the fisher not been able to produce a receipt when required to do so. Fishing and tourism businesses selling licences will have problems incorporating that cost into their charges. An impost is placed on recreational fishermen who may just dabble here and there throughout the year but who may want to invite tourists, visitors or friends to join in their recreational occupation occasionally. I foresee problems on the south coast for Victorian tourists travelling north, with children who may be just over the age of 18, as they do throughout the year, falling foul of these fairly strenuous requirements.

I have received representations concerning the bill's impact on aquaculture. I commend the Minister for his attempts at helping the production of aqua food in New South Wales. Worldwide that industry is worth $500 million. New South Wales contributes a very small proportion of that industry's production at this stage, but with our resources we could contribute a lot more. People have approached me with concerns about cost recovery aspects of the bill. The current $350 annual fee could be blown out to $3,500 per annum for an aquaculture enterprise such as trout production. The Eucumbene trout farm is a case in point. A number of players in the industry would need to pay that figure over a five-year period and that will cause significant hardship to the people who are trying to develop sustainable fisheries in New South Wales. That fee will impact on many businesses, including those engaged in tourism and value-adding with products such as smoked fish, and on people trying to diversify farm enterprises.

Many industries in Australia previously had the assistance of State and Federal governments, the CSIRO and other industry groups for funding research and development and for placement of sustainable regulations upon industries without those players having to foot the full bill. I note the comments of the honourable member for Port Macquarie on the shortfalls in fisheries and the requirement that they pay significant funds through Treasury. I do not think the analysis has been done. The Minister for Regional Development spoke earlier about various issues papers on sharing, benefits, potential, options for tourism, and implications for commercial fisheries and post-harvest enterprises. He said that a number of commercial fisheries operations will need to be removed as a result of the provisions of the bill.

A lot of that falls short of the cost-benefit analysis of the value of fisheries and their products, the fish we consume, as they travel through the market to the Sydney restaurants and cafes. There is a fantastic array of fish products that can be consumed and a wonderful opportunity for their export across the world. Australia already exports abalone to Japan. Recently in Eden I saw a tank with 400 abalone that were about to be chilled and packaged live to Japan. There is a considerable value entailed with that product. The oysters and mussels and other aquaculture products from Eden are world-renowned and their export potential is fantastic.

We already have a tuna industry and there is a possibility of a mackerel industry in Eden. It is hoped to export mackerel to Europe, including Norway, and that will bring value-adding. With the multiplier effect from fishery to table, including to restaurants and dinner plates across the world, many should share the costs involved in promoting the industry. It should not be borne only by those who are involved up front in the first stages of fisheries. I am sure that that multiplier is of significant value. This value-adding, this hidden cost, and a multiplier effect within the recreational fishing industry also has to be taken into account. I have heard it said that recreational fishers pay $200 a kilogram for every kilogram of fish that they catch and take home. That is astronomical, and there is certainly a multiplier effect. Many recreational fishermen have tens of thousands of dollars tied up in motor vehicles, boats, gear and equipment and spend between $8,000 and $10,000 annually pursuing their recreational sport.

Often, the fish they consume is incidental. A $20 licence fee for one year or $70 for three years is not beyond them. But the implications of the production of licences and the implications for visitors and friends and the tourism industry generally have not been taken into account. Also, the costs involved in the sport of fishing—for fishing gear and bait, outboard motor and boat repair, vehicle registration fees for the heavy vehicles that are needed to tow boats, and boat registration fees and licences—have not been taken into account by New South Wales Fisheries and are not a factor in this bill. Recreational fishing and aquaculture in the Monaro electorate—in particular, the Gaden hatchery, salmon at Jindabyne and recreational fishing in Lake Jindabyne, Lake Eucumbene and the mountain rivers—is of significant value to the State.

There have been licensing problems in this area. New South Wales salmon, which is disease free, is a valuable resource. If a shortage in salmon stock occurs in other parts of the world, the Gaden hatchery will be able to provide fish stocks, as it has already done to Tasmania, to ensure the viability of those industries. I note a provision in the bill to prevent the transport of fish prohibited in New South Wales into New South Wales rivers and streams. Because of the close proximity of the Australian Capital Territory and Victoria, there needs to be a high level of dealings between New South Wales Fisheries and the Australian Capital Territory and Victorian governments. As to the sustainability of fisheries, the establishment of a cross-border commission, as has been suggested by the Opposition, would ensure equality across the eastern part of Australia. The establishment of such a commission would assist consumers and recreational and commercial fishers by overcoming the barriers created by the different rules and regulations in the various States and Territory.

The aquaculture industry is of great benefit for the future of Australia. In many respects it has been stifled by the requirements within the legislation. We have heard about yellow-bellied perch and yabbies in New South Wales freshwater rivers, streams and dams and the possibility of farming ocean fish, such as snapper, oysters, shrimp and bait fish, in saline inland rivers and streams. These areas need to be investigated. There have been problems in the past with the hand-gathering industry along the South Coast. I welcome the involvement of the indigenous people of New South Wales in the mussels and cockles hand-gathering industry in southern New South Wales. There are a number of conflicts within the management advisory committees. The potential of different species, such as abalone, cockles, mussels and oysters, and the implication for commercial fishers in the Eden and southern port areas, who are in competition with fishers across New South Wales and Australia, need to be taken into account. The implication of commercial buybacks also needs to be dealt with, as the buybacks will impact unfairly on many commercial fishers. I thank the House for the opportunity to speak to this bill.

Mr McBRIDE (The Entrance) [11.14 a.m.]: I support the Fisheries Management and Environmental Assessment Legislation Amendment Bill. I take great pleasure in supporting this bill because it is fundamental to one of the major issues in our community, that is, the sustainability of fish resources throughout the State. I want to refer to one of the points made by the honourable member for Port Macquarie, who led for the Opposition on this bill. I do not know whether the honourable member said that the Opposition would support the bill. I listened to his contribution for 20 minutes, and I was not sure what he said about any particular issue. He tried to imply that this legislation was designed to fund New South Wales Fisheries. He was totally and utterly wrong. He claimed that, as a result of a direction stemming from Treasury, Fisheries would use the money raised from the licence fees to subsidise the operations of the department.

The current budget allocation is the highest allocation for the department in recent history, and that excludes the introduction of licences. Not only that, there has been a continual increase in the budget allocation under this Minister. The furphy that this is a fundraising exercise degrades the Opposition because it is wrong and diminishes the Opposition's argument. The Opposition is trying to get away from the real issue, that is, the sustainability of resources. I give credit to the honourable member for Monaro who took up the issue of fisheries and the importance of the whole spectrum of fish stocks to rural and regional New South Wales and to other States. This is very important legislation. I commend the Minister for his consultation.

The Opposition said that this legislation had been rushed through. It was not. The Parliament has been aware of the need for the sustainable management of our fisheries throughout the State for the past decade. Legislation introduced in 1994 by the previous Government advanced the situation. But it was clear that further legislation was required to deal with unresolved issues. This Minister has taken on the task of dealing with those issues. In 1999 the Minister organised a recreational fishing summit. The vast majority of anglers at that summit supported the concept of a general recreational fishing fee and asked for the release of a discussion paper on this issue.

In other words, the concept of the recreational fishing licence generated from a summit involving the shareholders, that is, the recreational fishers. The summit proposed the introduction of a fee for recreational saltwater fishers. Anglers supported that concept in part because of the successful reintroduction of the freshwater fishing fee, which has had an 85 per cent take-up rate and has been totally endorsed by country New South Wales. As primary producers, they understand how essential the sustainability of fisheries is to the State. As a result of the summit and the recommendation by the participants in the summit to take this action, the introduction of the fee is provided for in this legislation.

Honourable members should note that the key planks of the freshwater fishing fee will be translated across to the saltwater fishing fee. All fee revenue will go into recreational fishing trusts. All the money raised is hypothecated to recreational fishing trusts. The fee revenue can only be spent on recreational fishing programs. Again, the money is hypothecated. Anglers will be advised on trust expenditure through a transparent committee process. There could not be a more open and dedicated process than that proposed in this bill. Firstly, the fee was a recommendation of the people who fish. Secondly, the implementation of a saltwater fishing fee resulted from the success of the reintroduction of the freshwater fish fee. Thirdly, the money raised will be hypothecated. It is additional money for the department; it is not to supplement a loss of funding. That money will be used specifically to improve recreational fishing.

Secondly, in 1999, the Hon. Eddie Obeid, in the other place, convened a commercial fishing summit to bring together the key stakeholders to discuss the future of fisheries management. As we all know, this was an election commitment of the Carr Labor Government. Something like 200 of the State's commercial fishers attended the summit to discuss the state of our commercial fisheries. The summit provided much of the impetus for the reforms in the bill. One of the key themes of the summit was how we could improve consultation with the industry. The Government has been able to act on the recommendations of the summit. Not only did we talk to the recreational saltwater fishers in 1999, but we spoke to the commercial fishers, who also provided the impetus for the introduction of the legislation. They recognise the need in the community to deal with those issues.

Thirdly, as part of the consultation process, which was a commitment of the Government and the Minister, on 19 January the Minister for Fisheries launched the discussion paper "Sustaining Our Fisheries", as a strategy to revitalise our fisheries, underpinned by a proposal for a general recreational fishing fee. One of the goals of the introduction of the fee and the legislation is to generate revenue that can do more to make fishing better, improve our fish habitat and allow anglers to improve the management of their sport. Around 100,000 papers were distributed. They were downloaded from the web, faxed, posted, hand-delivered and emailed. There were 10 weeks of formal consultation and, overall, more than 1,000 individual submissions, many of which were of substantial detail; as well as petitions and form letters.

The great majority of those who took the time to prepare their submissions supported the principle of a saltwater fishing licence. A saltwater fishing licence was introduced in consultation with recreational and commercial fishers. The legislation originated from consultation and the fact that commercial fishers recognise the need to enhance the sustainability of their industry. In February the Minister visited my electorate and met with recreational fishers to discuss this issue. It was quite a lively meeting held at The Entrance Bowling Club. Something like 50 people attended, representing retailers, stores, accommodation providers, bait and tackle people, and so forth. A number of recreational fishing clubs in the area were also represented. One that comes to mind is the Tuggerah Lakes Memorial Club.

Those who attended the meeting were concerned about the introduction of the licence. At the start of the meeting there was open hostility towards the Minister and the idea of a fishing fee. But at the end of the meeting, after the Minister explained that the money would be hypothecated, used and returned to the industry, all that hostility dissipated. Fishers clearly saw the benefits to the whole of the community through the introduction of a fishing fee. Last Monday week the Minister opened the Fish Interpretive Centre and Conference Centre associated with the Fishing Office at The Entrance. Following the opening of the facility he took the opportunity to discuss these issues with professional fishers from the Tuggerah Lakes-Lake Macquarie area.

Again, what started out as a hostile protest was resolved after the Minister took the time to explain the issues associated with the bill. When one takes away the Opposition's furphies and criticisms of the bill that make out that motives other than improving our fisheries throughout the State are associated with the bill, when both recreational and professional fishers get the correct information, when they get accurate and unbiased information about the process, the hostile meetings become quite friendly meetings. Professional fishers left the meeting Monday week ago not delighted but certainly happy with the assurances the Minister gave them about the introduction of the legislation.

As all honourable members would know, the Central Coast has a large tourist industry. A lot of people who visit the Central Coast take the opportunity to fish in our waters. There is a huge demand for tourists to participate in fishing in my area. But we also have local commercial fishers who, by any standards, are small operators. If we are going to make the area work we have to recognise the changes that have been made to the area. Some 100 years ago commercial fishing was a way of life for a large part of the Tuggerah Lake community. People who wanted to go to The Entrance would catch a ferry from Wyong that went around Chittaway, Berkeley Vale, Killarney Vale, Long Jetty and then pulled in at The Entrance. The boats were capable of carrying 60 or 70 people.

One could not take that same boat trip today because of siltation that has occurred in the past 100 years. That whole fish environment and habitat has changed totally. The previous Government initiated the $13 million Tuggerah Lakes Restoration Program in an attempt to rehabilitate the area, but the desired outcome was unable to be achieved. Commercial fishers must realise that the situation is not as it was. If they are to survive they have to be a part of the process. Most importantly, the Minister assured them in the meeting I attended with him that the process is clear, open and transparent. They are businesspeople, and the Government recognises that. The Government also recognises that there will be a downside for those who are affected by the change. But the Minister assured them that their commercial rights and the income they have earned from their businesses would be taken into consideration.

No fisher will be forced out of the industry. It is hoped that change will be achieved through negotiation. If there is an absolute need, fishing rights will be acquired. But the Minister stressed time and time again that fishers will be part of that process. Professional fishers went away from the meeting satisfied that the Minister responsible for the industry understood the industry. But, more importantly, that he understood the commercial needs of private operators in that sector, that is the commercial fishers. The Minister for Local Government, is a former successful small businessman. He, too, like Minister Obeid, has a clear understanding of the commercial needs of businesses. He understands that changes to the industry have to be negotiated. One cannot truncate someone's job or industry and leave them dangling. There has to be negotiation, and that comes through clearly in the bill.

If honourable members were to read the Minister's second reading speech they would see that negotiation is a driving force behind the legislation. The bill is based on extensive community consultation with private fishers, saltwater fishers and commercial fishers to achieve an outcome that will provide sustainable fishing within this State, not just in the immediate term but in the long-term future. The Government regards fishing as a major industry for this State. It wants the industry to continue. But, most importantly, it wants it to be a successful, sustainable industry so that those in the industry can earn a good income and those who want to fish—recreational fishers—will also be able to fish.

Mr R. H. L. SMITH (Bega) [11.29 a.m.]: I shall comment briefly on the Fisheries Management and Environmental Assessment Legislation Amendment Bill. The fishing industry is one of the traditionally important industries on the South Coast and far South Coast. There is a large fishing industry in my electorate of Bega, which runs from Pambula in the south to Ulladulla in the north. Ulladulla and Bermagui are the two big bases for the fleets. Bermagui also is a large recreational area for many people who like to partake in fishing competitions on the shelf. Obviously, the industry is faced with resource problems and this bill relates to managing that resource. The Fisheries Management Act, which was enacted during the term of office of the former Fahey Government, dealt with similar matters.

The bill again deals with share managed fisheries. When the Fahey Government introduced the Fisheries Management Bill almost all interested parties, including the environmentalists and commercial and recreational fishers, agreed with its contents However, the previous Minister used a loophole in the Act to revert to restricted fisheries. After progress was made towards share managed fisheries, consultation undertaken and agreement obtained, particularly from the commercial industry, the concept was not carried through. That was rather disappointing. Only two industries proceeded to share managed fisheries: the abalone and rock lobster industries. In this bill those fisheries are categorised as category one because they have share managed licences. If the licence is cancelled full compensation must be paid.

One reason the Carr Government decided not go along with the concept of share managed fisheries was simply because it wanted to cancel fishing licences without paying compensation. That situation has now been reversed and in this bill category two fisheries revert to share managed fisheries. The provision has a slightly different implication in that 15-year share licences are issued and compensation is payable on termination of the licence only if five years remain after notice by the Minister. The fisheries involved in category two are ocean prawn trawl fishery, ocean fish trawl fishery, ocean hauling fishery, ocean trap and line fishery, estuary general fishery, and estuary prawn trawl fishery. I do not believe that provision will present any problems as it represents a return to the process that was stalled by the previous Minister a number of years ago. It is a great way to preserve fish stocks and ensure the resource for future generations.

The bill also deals with problems caused by the Land and Environment Court to fisheries. As a fishery licence expired, it was reissued without an environmental impact statement being carried out. That is what happens in almost every other industry. Those involved in the forestry industry would be able to highlight the implications of environmental impact statements. Some sections of the industry are concerned that a third party will conduct the environmental impact statements. The fisheries department has the necessary resources and scientific expertise to carry out environmental impact statements. It is not necessary to call in a third body from another consultancy area. Consultants were called in to assist in the formulation of forestry environmental impact statements. I do not envisage problems with those provisions.

The provisions of the bill that most concern me are those relating to recreational fishing and the implementation of saltwater licences in line with this Government's re-implementation of the freshwater licence. Those provisions will have the greatest effect on my electorate. Recreational fishers will have to pay $25 for a yearly licence, $5 for a three-day licence, $10 for a monthly licence or $70 for a three-year licence if they want to take the gamble on licence costs increasing. Along the whole of the eastern seaboard, estuaries, lakes and rivers face the problem of overfishing. That will lead to problems in the implementation of the licence. Many inland fishermen from up and down the eastern seaboard would have willingly forfeited their licences, but the Minister decided he would not make a general call for licences. Instead he intends to pick winners.

As I understand it, Botany Bay, Lake Macquarie and Georges River are the areas from which the Minister wants to buy out all recreational licences and pay compensation. Had he made a general call up and down the coast, he may have had more success. To many recreational fishers in my electorate the Minister seems to be picking winners. They believe they are paying the licence fee for something from which their estuaries and rivers will not derive any benefit for many years. I should like to give an example of that process. For some reason the Minister has not included the commercial fishermen from Tuross Head in the early buyout category. Those fishermen believe they met all requirements to become eligible to fall within the first allocation of moneys to buy out licences. Those fishermen are upset that they are not included in that category. A tremendous number of complaints have been received from the Bega River area and other areas because fish are being netted and insufficient numbers remain in the estuaries and rivers for recreational fishermen to be given a fair go at their sport.

I anticipate fishing licences causing a problem for the tourist industry. My electorate borders Victoria. Most of our tourists come from inland, over the range, and from Victoria. They will be coming from an area without fishing licences to an area where they will need what will be, to my way of thinking, an expensive licence. People want to spend a day out, recreational fishing with their families. They have already bought their fishing gear and have the kids organised. They will not want to pay an extra amount per child and per adult to enjoy what has always been regarded as part of our heritage, that is, fishing wherever they want in saltwater areas. Many visitors from Canberra will resent the fee and that will affect my electorate's major industry, tourism. Had people been given the right to buy out fishing licences within my area as well as those areas selected by the Minister, I believe he would have got far more support for the introduction of licence fees.

Mr BARTLETT (Port Stephens) [11.41 a.m.]: It gives me great pleasure to speak on the Fisheries Management and Environmental Assessment Legislation Amendment Bill. The honourable member for Monaro spoke about sustainability. I take up a point raised by the honourable member for Bega: children under 18 years will not pay a licence fee. Someone helping a child to bait a hook will not have to pay a licence fee. People over 65 will not have to pay a licence fee. I moved to Port Stephens in 1962. At that time Nelsons Bay was a sleepy fishing village. The fishing industry took care of a great deal of the business that went on in that town. My father, as with many fathers, took me down to the local finger wharf to catch fish. Some 30 years later there is now a huge dolphin and a whale watching industry based at Port Stephens. Something like 200,000 visitors a year are stepping on to about 20 sightseeing boats. Whale and dolphin watching is an enormous attraction to the Port Stephens area. Consequently, the professional fishing industry does not represent as big a percentage of the economy as it used to.

Mr O'Doherty: You still cannot catch any fish from the finger wharf.

Mr BARTLETT: The finger wharf is long gone. Some 200 dolphins live in Port Stephens, unlike Sydney Harbour, where pollution, noise and movement have driven them away. They seem to be there all the time. They occasionally go outside the bay but most of the time they are inside. Obviously, the sustainable level of fish stocks within the estuary to keep the dolphins there for the tourist industry is becoming an interesting issue. I remember that when I moved to Port Stephens in 1962 I had a bit of a crush on a young lady who appeared on Disneyland programs called Annette Funicello, a gorgeous young thing. She never knew I existed, of course—and not much changed for the rest of my life. On a Disneyland program I saw that on the islands off the western coast of Canada bears used to come down to the water's edge to catch salmon. I told myself that one day I would go to see that.

In 1998 I got to Bellingham, our sister city, went up to the Evergreens between British Columbia and Victoria and stayed on West Thurlow Island for about a week. The point about the story is that the bears no longer go down to the water's edge on those islands to catch the salmon because the Pacific salmon are no longer there. The recreational fishermen in that part of the world who used to fish for the koho, the name of the salmon, on their fishing excursions are allowed to take only one coho, and it has to be caught on a barbless hook. Professional fishermen are allowed only 10 days a year to fish because the stocks have been devastated by overfishing. I have followed the argument about fishing stocks around the world. The evidence seems to be that once fishing stocks go below a certain level they never recover. We need to err on the side of caution in relation to the sustainability of fishing stocks. If we do not, the stocks will not be there and, it seems, they do not come back. I would like to deal with the global perspective. I refer to an article by Pamela M. Mace entitled "Developing and Sustaining World Fisheries Resources: The State of the Science and Management" delivered at the World Fisheries Conference. She stated:

For capture fisheries, overcapacity is the single most important factor threatening the long-term viability of exploited fish stocks and the fisheries that depend on them. Global fleet capacity must be reduced substantially, perhaps by as much as 50%, to levels commensurate with sustainable resource productivity.

She went on to deal with an issue that has been part of the argument over the past 12 months in New South Wales. She stated:

The challenge for the future is to build on existing successes to effect a transition to environmentally and economically sound fisheries on a global and local basis. This is a formidable task. The transition will have a high price in monetary terms, and an even higher price in social terms. Therefore, the transition will be resisted and there will be pressure to preserve the status quo. Unfortunately, except in rare cases, the status quo is no longer a viable option. The groundrules that have brought fisheries to a crossroad must be abandoned in favour of new paradigms that emphasise long-term sustainability over short-term gain ...

Several recent spectacular examples of overfishing have accelerated the debate. After years of overfishing, the Grand Banks cod fishery collapsed dramatically in 1992—

they have never come back—

resulting in the loss of about 40 000 jobs in Newfoundland. In 1994, in response to severe overfishing leading to severely depleted stocks, the US New England Fishery Management Council initiated plans to reduce fishing effort on groundfish by 50% and indefinitely closed more than 3000 square miles of Georges Bank ...

The decline in British Columbia has continued since 1962, when I saw the bears coming down to fish at the water's edge. In 1982 the fleet was reduced. For British Columbia salmon a plan to reduce the number of licences was implemented in 1996. In the British Columbia rockfish fishery in 1980 to 1985 there were 20 to 30 vessels compared with more than a hundred vessels in 1995 for similar total landings. So more vessels were pushed into the fishery but there was the same number of landings. I follow this argument very closely through my community. I addressed it during the consultation process undertaken by the Minister. I went to the Karuah Progress Association and talked through the issues about setting up the three different sorts of trusts. The trust money will be spent in the areas for which they were collected. It will not be, as somebody claimed earlier, hived off to keep New South Wales Fisheries afloat.

Fishing licences facilitate the long-term sustainability of the saltwater fishing industry. There have been discussions about whether people will buy the licence. In 1996 there was a problem with four-wheel drive access at Stockton Beach. A licence fee was introduced and those people wishing to take their four-wheel drive vehicles onto the beach had to obtain a $25 licence. At present, 9,000 vehicles have obtained the licence and revenue from that is in the order of $175,000 per year. The money is being used to put in accessways, to construct surf clubs and to man the surf clubs and to provide car parking facilities. The licence fees have led to tremendous benefits to the Stockton Beach area. Therefore, the argument that the $25 fee will be objected to does not hold water. People will agree to pay the fee when they realise the benefits of the changes that will flow from the payment of it.

I shall now deal briefly with some of the miscellaneous amendments. People fishing illegally without permits now run the risk of having their motor vehicles seized. The amendment makes provision for a court that convicts a repeat offender of fisheries offences to make an order prohibiting offenders from engaging in specified commercial fishing activities or being on any boat or in any premises of a kind specified as being associated with commercial fishing activities. That order is a new measure and may remain in force for up to five years. People will be able to purchase licences from a number of places, so that provision is not unduly onerous. Arrangements will be made to allow the sellers of licences to recoup their expenses. Anyone fishing must carry the fishing licence at all times when fishing and anyone who does not do so will face a penalty.

The people of New South Wales consume about 125,000 tonnes of fish annually. The wild catch from New South Wales is 17,500 tonnes and the estuary catch is about 4,900 tonnes, which is about 4 per cent of total consumption of fish. Most fish comes from the other States. However, some comes from overseas. The funds derived from licence fees will be used specifically for the buyout of the professional fishing fleets in designated areas. Trust funds will be useful in the future, particularly in providing funding for restocking. In many instances the trust funds will decide where the money is to be spent.

I turn now to the entitlement to compensation by professional fishermen who believe they have not been treated properly. If the amount of compensation cannot be agreed between the Minister and the fishermen, the Minister may determine the amount in accordance with the regulations. If fishermen are still not satisfied, they can refer the matter to the Valuer-General for advice as to the amount of compensation to be paid. If they are still not satisfied, they can appeal to the Land and Environment Court. There are various avenues in the buyout process to look after the rights of professional fishermen and, indeed, everyone involved in New South Wales recreational and commercial fishing. The bill seeks to address the sustainability of our fishing industry. The bill has created considerable debate in the Port Stephens area and will do so for some time. At the end of the day will provide a bucket of money to enable the transition to be as smooth as possible and to deal with the effect of the buyout on commercial fishermen, their families and their lifestyles.

Debate adjourned on motion by Mr J. H. Turner.

ELECTRICITY SUPPLY AMENDMENT BILL

Second Reading

Debate resumed from 16 November.

Mr J. H. TURNER (Myall Lakes) [11.56 a.m.]: The Opposition welcomes the introduction of this important bill. However, at the outset I make it clear that the Opposition has strong reservations about a key component of the bill, that is, the component that sets in place the Electricity Tariff Equalisation Fund [ETEF]. From 1 January 2002 every householder in this State will become a player in the national electricity market [NEM]. That means that we will be able to choose whom we buy our electricity from. That is a marked difference from the regulated franchise system that is currently in place, under which the Government dictates electricity supply.

The bill provides for a major change. It opens the New South Wales market to full retail contestability—competition that has never been seen before in the domestic electricity market. The introduction of full retail contestability will mark the full implementation of the NEM. The NEM has been operating for several years, facilitating a deregulated market for medium-scale and large-scale customers. As I mentioned a moment ago, the current arrangements for the supply of electricity are governed by a franchise arrangement. That means the six State-owned distributors—EnergyAustralia, Integral Energy, Advance Energy, Great Southern Energy, NorthPower and Australian Inland Energy—are bound to supply customers within designated service areas.

The bill sets in place the mechanisms that will allow consumers to choose their electricity supplier. It also sets down stringent customer protection provisions, which are welcomed by the Coalition, and establishes new market rules for electricity suppliers entering the deregulated New South Wales market. The bill also provides new powers for the Independent Pricing and Regulatory Tribunal, whose current powers in relation to electricity expire on 31 December this year. The Government has had all year to bring forward this bill, but it comes as no surprise that it has been left until virtually the eleventh hour.

The Opposition hopes that the bill, when enacted, will offer appropriate customer protection, while at the same time delivering on the promise of cheaper electricity for all consumers. I hope that will happen, but given the Government's track record in managing electricity assets, I have some very real doubts that it will. The current legislation, the Electricity Supply Act, focuses on a strong regulatory regime. The bill makes changes to that regime, establishing a class of customers known as "small retail". Small retail customers will be those who consume less than 160 megawatts, or less than $16,000 worth of electricity, in a year. That definition includes every householder in the State.

The Opposition supports the key entitlements for small retail customers contained in this bill. These entitlements include the right to choose between a competitive or a regulated tariff. That means that customers can choose to shop around for the best price for their electricity or to remain with their current supplier. Customers will also be able to shop around for a better price and then return to a regulated tariff if they are not satisfied with the arrangements on offer. Another entitlement is supply contracts containing minimum terms and conditions. The bill sets down the need for a minimum set of terms and conditions that cannot be negotiated or bargained away. That is essential. Anyone who has entered into a mobile telephone contract is well aware of the extensive contract arrangements and small print contained in any agreement. I understand that the terms and conditions are still the subject of consultation, and the Opposition looks forward to carefully examining their content.

Free access to an electricity ombudsman scheme for small retail customers will also be introduced, and the Opposition welcomes this move. I would expect that the transition to a deregulated market will not be without problems and a degree of confusion for customers. Access to a free ombudsman scheme is going to be an essential part of the transition and operation of the market. The new powers proposed for IPART will be an essential part of the entitlements for small retail customers. IPART will be given the power to determine regulated retail tariffs in a move that will offer a degree of protection to the market. I seek an assurance from the Minister that the prices set by IPART will not rise above the consumer price index figures of the day. That is a guarantee that the Minister needs to give to the householders of this State.

As I mentioned earlier, this bill offers small customers the choice to return to a regulated tariff. The Opposition supports this move. It will allow consumers to test the national electricity market, to shop around and see what is available, and to return to a regulated tariff if they cannot find a better deal. I am pleased the new powers proposed for IPART clearly recognise that electricity supply will no longer be the sole domain of government-owned companies operating in a franchise environment. The key roles of IPART from 1 January next year will be to determine regulated retail prices in accordance with a reference from the Minister for Energy. It is my understanding that the reference from the Minister may specify the period for reporting, in addition to setting out any matters that IPART must take into account in making its determination.

I would like to raise an important issue in relation to the management and oversight of the New South Wales electricity industry. As honourable members would be aware, the Minister for Energy has responsibility for regulatory issues relating to energy, while the Treasurer and the Special Minister of State as the shareholding Ministers have responsibility for financial management and oversight relating to the state-owned distributors and generators. That blurs the lines of responsibility somewhat, and it has been a longstanding concern of mine that at no one time do all three Ministers have a full understanding of what is actually happening in the industry. I raise this matter now in the context of the Minister for Energy issuing a reference to IPART on setting regulated retail prices.

I ask the Government: Will the Minister be making the reference following consultation with the shareholding Ministers, or will it be something that he does on his own? I ask the question because there are important implications across the board flowing from any change in the regulated retail price. Any change will have an impact on the bottom line of both the generators and distributors, and this is within the realm of the shareholding Ministers. I seek clarification on that particular point. IPART's determinations may set out tariffs or charges, and it will be an offence for businesses not to comply with the IPART determination. The bill also establishes standard retail suppliers who will be responsible for offering regulated tariffs to small retail customers. The standard retail suppliers will be the government-owned retailers—EnergyAustralia, Integral Energy, Great Southern Energy, Advance Energy and Australian Inland Energy—who will be obliged to offer supply to all customers in their electricity supply district, in much the same way as they currently do under franchise arrangements.

The bill also sets out a scheme that ensures these standard retail suppliers receive a regulated return for providing this service to customers. This scheme will be known as the electricity tariff equalisation fund [ETEF]. There is a section of this bill that deals exclusively with the new arrangements for these standard retail suppliers, and it is that section which is of grave concern to the Opposition. Firstly, the content of the bill does not fully explain how the ETEF will operate. I understand the operation of the ETEF will be explained in regulations that are still being developed, but the Opposition would have liked to have seen much more detail on this matter in the bill. It is interesting to note that the Minister made only cursory reference to the fund in his second reading speech.

According to the explanatory notes to the bill, the fund is supposed to be "A mechanism to manage the wholesale purchase risk borne by standard retail suppliers who are subject to competition in the wholesale electricity markets but who have to retail electricity obtained in that market at regulated retail tariffs to small retail customers." It is of concern to the Opposition that the fund may expose the State Government, and therefore the taxpayers of New South Wales, to massive financial risks. The fund will operate to manage risk—that is clear. The risk will be as follows. IPART will set a regulated price. When the electricity pool price on the national market falls below that regulated price, retailers will pay the difference into the fund. Conversely, when the pool price rises above the regulated price, the Government will pay the difference to the retailers.

There is a very real possibility that the pool price will be above the regulated price for long periods of time, meaning the money that is in the fund will dry up very quickly. In the event of that happening, the electricity generators will be expected to provide funds to pay to the retailers to make up the shortfall. The argument of the Government is that the generators will benefit from high pool prices for their power and will therefore be able to afford to "top up" the retailers. It is the Opposition's contention that the generators will not be able to sustain that level of payment back to the retailers. I raise this concern in light of a similar policy that was implemented in Queensland. That policy was called economic purchasing, and was put in place on the recommendation of the very same people who are now running the Market Implementation Group at State Treasury.

Economic purchasing in Queensland meant the Government indemnified the retailers to the extent that their cost of purchasing energy exceeded the price they were allowed to charge their franchise customers. The indemnity was, in effect, a free cap from the Government to retailers—the end result being that any financial risk was transferred to the Government, and that is where problems began. It is interesting to note, and it is of great concern, that the Beattie Government in Queensland has now abandoned economic purchasing, because the policy has cost them an estimated $500 million through the risk that the Government was exposed to. This policy has the potential to expose the Government, and therefore the taxpayers, to a massive financial risk. I call on the Minister to give a guarantee that the Government is not about to implement a policy that is close to economic purchasing. The Opposition has strong concerns about this section of the bill. If those concerns are not adequately addressed we may have no option but to oppose that section of the bill in the upper House. We cannot responsibly support a policy that involves such a degree of financial risk.

Other parts of this bill establish a legal framework for IPART to determine other retail charges, including security deposits and late fees. Importantly, the bill also allows IPART to regulate a customer's contribution to the costs associated with connection to the network. Distributors are currently allowed to determine what portion of a connection fee will be borne by the customer, and what part the company will absorb. In country areas this can be prohibitively expensive, with the cost of connection running to around $8,000 per electricity pole. I am pleased that the Government has included this provision in bill. It will undoubtedly make access to the network cheaper for many customers and will mean that the companies share the cost.

With the introduction of a competitive market, it can be expected that the electricity suppliers will be on the "hard sell" to attract customers to their company. Marketers will be pushing for small customers to change providers in an effort to boost customer numbers. The bill, therefore, also sets out the establishment of a marketing code of conduct to control the behaviour of retailers and marketers. The code, which is also under development, will set out strict guidelines for the operation of these marketers. I hope there will be sufficient penalties to deter any breaches of the code. Other important provisions of the bill relating to customer protection, all of which are supported by the Coalition, include access to the free electricity industry ombudsman and protection of customer information in a highly competitive environment.

As honourable members may be aware, IPART has been circulating a discussion paper concerning the future separation of retail and distribution functions of state-owned electricity distributors. I was a little surprised to note that the bill contains the framework for this delineation before IPART has finalised its position on this matter. I hope the Government is not second-guessing the outcome of IPART's proposal on this matter. With the advent of a competitive market where customers will be able to choose their retailer there will come a change in metering. There are different ways that metering can operate in a competitive environment and the bill recognises that fact. The bill provides for the appointment of a specific metrology co-ordinator, who will be responsible for developing a set of metering rules. These rules will include the way data is collected, managed and used. The bill also sets out methods for the establishment of rules that would result in the development of a standard form network use of system agreement.

This agreement would pave the way for the entry of new retailers to the New South Wales market, setting out the conditions under which new entrants would operate and perform. This is another step towards opening the market to competition in the hope that consumers will benefit from lower prices. In summary, this bill is an important step towards the transition to full retail contestability. The Opposition believes the consumer protection clauses of the bill are a step in the right direction. We support any move that will offer consumers some choice in electricity supply, while at the same time affording the appropriate degree of protection. However, we have concerns—and I look forward to the Minister's response to those concerns.

People of my electorate welcome the main thrust of the bill in relation to contestability. NorthPower will face dire financial consequences as people flood out of the NorthPower scheme at the earliest opportunity. Daily people contact me about NorthPower and its actions. This bill will give my constituents an opportunity to move from NorthPower into other areas of electricity supply.

Mr HUNTER (Lake Macquarie) [12.10 p.m.]: I am pleased to speak to the Electricity Supply Amendment Bill. The explanatory note of the bill states:

Electricity Supply Act 1995

Principal Act

The Carr Government has already implemented some of the most extensive electricity reforms in this country, some of which have been quite controversial and have seen opposition. I am on record as not fully agreeing with some of the changes. I point out that the electorate of Lake Macquarie has had six underground coal mines and one open-cut coalmine feeding into power stations on the Central Coast. Eraring power station is located in my electorate, and I worked there prior to coming into Parliament—I put that clearly on record. In my electorate I have many former work colleagues in the electricity industry. My brother still works in electricity generation, and my father worked there before he entered this Parliament. I know and understand the electricity industry very well.

My concern has always been about employment for constituents in my electorate—that their jobs would not be lost due to electricity reform. As the Minister and the Government know I have spoken quite vocally on behalf of those employees in the industry, and I will continue to speak on their behalf to ensure that their jobs are secure. It has been stated by the Government that customers have benefited to the tune of $1.5 billion since the start of the market reforms. As Chairman of the Government's Energy Caucus Committee I am pleased to say that the Electricity Supply Amendment Bill provides the legislative foundations for the next important stage of the Government's reform agenda—giving all electricity customers choice.

Clearly, reform has provided significant benefits to some electricity customers. However, this next stage of reforms needs to be managed very carefully. This is why the Carr Labor Government is proposing a package of retail competition reforms that maximise customer choice while offering small customers maximum protection. A key aspect of this protection is offering small customers price protection if they want it. That it is very important. We have been waiting for small customers to become involved in the system, to gain from the benefits of the reform process. Under the Government's proposal all customers will soon be able to buy their electricity from the competitive market, or stay on a tariff regulated by the Independent Pricing and Regulatory Tribunal [IPART]—most importantly, they can switch between the two.

Customers will enter the market only when it suits them, and if the market does not perform then small customers can opt back into the regulated system. To allow the Government to offer this protection, a scheme needs to be put in place that manages the financial risk of the retailers obliged to offer regulated tariffs to small customers. Retailers will have to buy electricity from the volatile wholesale market and sell to regulated retail customers at prices fixed by IPART. Unless there is a scheme in place that protects retailers from having to buy power at a price that is the same or more than IPART's price, there is a good chance that retailers could lose a great deal of money. In the past this risk has been managed by vesting contracts. These are contracts that the Government put in place between its own generators and retailers to fix the wholesale electricity price.

Vesting contracts have to be authorised by the Australian Competition and Consumer Commission [ACCC]. However, the New South Wales vesting contracts expire on 31 December 2000, and the ACCC has clearly indicated that it will not authorise any new vesting contracts, so renewing the vesting contracts is not an option. This means that the Government must develop an alternative scheme that complies with the Trade Practices Act. The Government has considered a wide range of options to replace the vesting arrangements. The broad options considered by the Government have been published on the Treasury web site and have been discussed in great detail with the New South Wales industry that will be required to participate in the scheme.

There are very few options available to the Government that simultaneously create a fair and competitive electricity retail market, do not expose the Government to financial risk and do not contravene the Trade Practices Act. The proposed arrangements to replace the vesting contracts best achieve this balance. The proposed arrangements included in the bill operate by compensating standard retail suppliers for the cost of buying power from the wholesale market. If the retailer's wholesale electricity costs are lower than the amount paid by regulated customers the retailer will be obliged to pay these surplus funds into the Electricity Tariff Equalisation Fund. The money in the fund will be kept for times when the wholesale costs exceed the amount paid by customers on regulated tariffs.

In the event that there is a sustained rise in pool prices and there is insufficient money in the fund, New South Wales Government-owned generators will be required to top up the fund. Generators will pay into the fund in proportion to the additional profits they have made by earning higher wholesale prices. This arrangement ensures that the retailers will always be in a position to economically provide electricity to customers at the regulated tariff and at the same time earn a regulated return. The bill also provides for the establishment of a ministerial corporation, the Electricity Tariff Equalisation Ministerial Corporation, which will be responsible for developing and administering the rules governing the operation of the fund. The rules of the fund will need to be approved by the Treasurer in consultation with the Minister for Energy. An important aspect of the bill is the restriction on the corporation from participating in the financial operation of the electricity market.

It should be very clear that the fund does not centralise the State's trading activities. The fund will not trade electricity and will have no involvement with the operations of the national electricity market. The Tariff Equalisation Fund is a central feature of the Government's package of customer protections. It simply allows the Government to offer regulated prices to small users of electricity. As I said at the beginning of my contribution, it is certainly time that small customers gained from the electricity reforms that have been introduced throughout the nation. I am pleased to support this bill and I commend it to the House.

Mr O'DOHERTY (Hornsby) [12.19 p.m.]: I recall from my days in the broadcasting industry that the engineers used to talk about clean power and dirty power. Clean power had the voltage regulated and did not contain noise on the line which may upset sensitive electronic equipment. Dirty power was not regulated in that way, a bit like the uninterruptable power supply for computers that is in place these days. I was impressed when the other day the nearby substation broke down, the lights in this building went off for a second but the computers did not. That is a tribute to the special power supply that was installed in this building under the previous Coalition Government. My point in talking about clean and dirty power is this—

Mr Yeadon: You are talking nonsense. I have not understood a word you have said.

Mr O'DOHERTY: The Minister for Energy interjects that he has not understood a word I have said.

Mr Yeadon: Come back to the clean and dirty power. It is a load of nonsense.

Mr O'DOHERTY: I will come back to the clean and dirty power. I was about to talk about it until the Minister interjected. My point about referring to clean and dirty power is this: This is dirty policy, it is not clean policy. In saying that I acknowledge that this is a difficult area of policy and the Government is grappling with these issues. I believe the community is still grappling with these issues.

Mr Yeadon: What?

Mr O'DOHERTY: The Minister says that he still does not understand. I will tell him. The Labor Party has had a bipolar attitude towards electricity reform from the time the Treasurer and the Premier said they were going to deregulate the industry in New South Wales and the left wing, of which the Minister is a representative, said they would not let them do that.

Mr Orkopoulos: Hear! Hear!

Mr O'DOHERTY: The honourable member for Swansea says, "Hear! Hear!" That tension still exists within the Caucus of the Labor Party. Not wanting to be political about this, I acknowledge that these are very difficult issues for the community to grapple with. No-one is entirely sure of the effect if we went down what the Premier and Treasurer said was the economically responsible path of deregulation. That is how we have got to this stage with a bill that is neither one thing nor the other. I want to make it plain that we support contestability and increased competition, which has brought benefits. That is not merely the policy of the New South Wales Government, it is a national policy. So I will not let them crow about it too much. That contestability has brought benefits for large and medium consumers of electricity in industry. Those same benefits ought to be available to consumers. In the way that telecommunications reform in this country had a stalling start and now is gradually starting to produce benefits, but only after the extreme monopoly power of Telstra was broken down by the regulators—

Mr Yeadon: The extreme monopoly power of Channel 9 and your Federal Government's HDTV decision.

Mr O'DOHERTY: The Minister for Energy is confused. He thinks I am talking about television. I am talking about energy.

Mr Yeadon: You were talking about telecommunications.

Mr O'DOHERTY: I was talking about telecommunications in the context of supply to consumers. The Minister will have to pay attention if he wants to keep up. The same problems applied to the full contestability of the retail market in electricity. The key question is: How are we going to guarantee that all consumers are able to benefit equally from the problems that may arise once we start to introduce contestability into the retail market? For the sake of the Minister, this bill tries to grapple with that. The speech that was written for him by his advisers goes to that question. He would find it instructive to read it. Therefore, this bill has to be seen as an interim measure. I have no doubt that the Parliament will be grappling with this legislation for the next 10 years. Some of the principles that are enshrined in it are principles that the Liberal-National Coalition believes are extremely important. For example, we have always supported the idea of choice. Choice for consumers is an important part of the philosophy of our party in a range of areas, including electricity.

As my colleague the Deputy Leader of the National Party said, we also support the minimum terms and conditions that are set down in this bill. We support the electricity ombudsman scheme. We believe that is an important protection for consumers. I often write to the Minister for Energy with concerns about electricity supply, only to get them flick passed to the authorities, which may or may not deal with the issues that are presented. I would say, as every other member says, that there is immense frustration at a system where the Minister for Energy, who is a shareholder to these corporations, still cannot produce a result for consumers. There has to be a better way. I hope the ombudsman scheme is that way. The Minister screws up his face. The fact is that he acts as a postbox.

I come to another concern we have, which partly relates to what I said earlier about the clean and dirty policy. The dirty policy, which provides that the Government still has ownership and shareholding in some of these corporations, has also provided the situation where New South Wales has been exposed to liabilities of between $600 million and $1 billion through Pacific Power and related companies. We still do not know the full extent of the cost to the New South Wales taxpayers of that debacle, which still has to go through the courts or perhaps through out-of-court settlements.

My colleague in another place the Hon. D. J. Gay has spelled out in great detail some of the Opposition's concerns about this matter. It is one of the great unwritten scandals that has beset the taxpayers of New South Wales. There has been small interest in the media. I commend those media organisations that have taken an interest in this issue. It deserves to be writ much larger because consumers in New South Wales have to understand what the New South Wales Government has engineered for them—a debt of perhaps $1 billion. On the one hand, the Government retains some control but, on the other hand, the Government is trying to introduce commerciality to many of the arrangements whilst retaining the risk to the New South Wales Government. That is the key issue in this bill.

The bill sets up the Electricity Tariff Equalisation Fund [ETEF], which is supposed to manage the risk. Our concern, as my colleagues have pointed out, is that the risk will still reside with the New South Wales Government at the end of the day. The Government might say that is an appropriate arrangement because it is brought about by the fact that the Minister is still hedging on the fact that consumers will have a choice between either a fully contestable contract or one that is regulated by the Independent Pricing and Regulatory Tribunal [IPART]. That is the dilemma, the dichotomy I was discussing earlier. That is why I say this House will have to review this issue in a few years time.

The ETEF, which is not clearly spelled out in the bill or by either of the Ministers, represents our major concerns. My colleague the Hon. D. J. Gay, the shadow Minister for Energy, will spell out our concerns on the ETEF in another place. My intention was not to be overly political, other than by clear criticism of the Government as to the Pacific Power contracts and the dichotomy in the energy policy. The Government has not provided clear policy on energy in six years in government. One half of Caucus wants to go one way, the other half wants to go the other way. So we get a bill that is neither one thing nor the other. I acknowledge that these are difficult questions and the same debate occurs in the community.

Mr Yeadon: You tell us what you would do.

Mr O'DOHERTY: The Minister asks what our position is. I will spell it out clearly. He is having a lot of trouble following this debate today. We support those parts of this bill that introduce contestability for consumers with some conditions. We are very concerned about the risk that still resides with the taxpayers of New South Wales. The situation at Pacific Power takes great precedence. As I have said, there is a liability to taxpayers of probably $1 billion, which adds to the taxation that we all pay every day. We have record amounts of taxation under the Carr Government. This is the highest taxing State in Australia. It is anti-competitive because of payroll tax, stamp duty, anti-growth taxes.

Mr Orkopoulos: GST.

Mr O'DOHERTY: The honourable member for Swansea mentions GST. I am sorry he did that because I was about to wrap up. That serves him right. The Carr Government is a beneficiary of the GST revenue. Despite the increased revenue the Carr Government gets through a tax that is linked to growth, it has not reduced any State taxes. The Government is rubbing its hands with glee, and there is a tax on top of taxes as well. The honourable member for Swansea, who is about to speak, may want to answer these questions: Why has his Government failed to decrease payroll tax to a competitive level? Why has his Government failed to end double taxation that imposes stamp duty on top of GST revenue, given that both taxes are anti-competitive and stifling to business in New South Wales?

Mr ORKOPOULOS (Swansea) [12.30 p.m.]: I am pleased to support the Electricity Supply Amendment Bill. In the entirety of his contribution the marginal member for Hornsby, who has left the Chamber, managed to talk only about his concerns in his attempt to find criticisms of the bill. He did not even acknowledge that the only commitment the Coalition ever made and the only policy it ever committed itself to was to completely flog off the entire electricity industry and bribe individual customers with $1,000. When the honourable member for Hornsby comes up with some sort of policy or credible criticism we will take him seriously.

The Carr Government is committed to reform in the energy sector. The Government believes its commitment to reform has already delivered more than $1.5 billion of savings for New South Wales electricity customers. However, there are real benefits for consumers. The Government will also ensure that small customers can rely on a stronger consumer protection framework. Implementation of the next stage of reform requires great care, as smaller customers will be exposed to the operation of the national electricity market for the first time. Although the Government is keen to extend the benefit of customer choice to all customers, we will do so only if we can be sure that small customers are protected. Players and customers alike will need some time to fully develop their systems and understand the options.

In light of this the focus of the amending bill has been to put in place a comprehensive set of customer protections, particularly while the market is settling down. In general, protections provided for in the bill entrench the service standards and protections that smaller customers currently enjoy. The Government believes that these standards represent a minimum level of service to which customers are entitled. But the Government has not stopped there. The bill also introduces new choices and options for customers. The new customer protection measures include providing smaller customers with the option of electing to enter into the competitive market, or remaining on a regulated tariff. Even when smaller customers have decided to test the benefit of the market, their protection continues.

For example, the Government will allow smaller customers the option of returning to regulated tariff arrangements if they are unhappy with what the competitive market is offering. However, the Government does not expect that many small customers will need such a facility. Just as customers who have already entered the market have benefited from lower prices and improved service standards, the Government is confident that customers about to enter the competitive market will also benefit. To make negotiating a supply contract easier for smaller customers the amending bill provides for standard form customer supply contracts that lock in minimum terms and conditions. This will ensure that consumers do not knowingly give away their current rights, such as appropriate disconnection procedures.

This means that customers can concentrate on negotiating a better price with their retailer, rather than being confronted with a complicated array of contract options. To ensure that retailers and their marketing agents behave in an agreeable manner the legislation also provides for the establishment of a marketing code of conduct. All retailers will be bound to comply with this code, and they will be responsible for the behaviour of any marketing agents that introduce customers to them. This will encourage retailers to use only reputable electricity marketers. Small customers have always had a right to take disputes to the Ombudsman. However, the bill extends the customer rights by giving customers a statutory right to free access to an ombudsman scheme.

In addition, the bill extends the scheme to customers who previously were not covered by an ombudsman scheme. Most importantly, customers living in caravan parks and boarding houses will be able to take disputes to the Electricity Ombudsman. The Swansea electorate has many mobile home villages, and I am sure the hard-pressed residents who are forced to pay GST on their rents will welcome the extension of consumer rights to people choosing such a lifestyle. Finally, the Government recognises that customer information will become increasingly valuable as the mass retail market develops.

The amending bill allows regulations to be made for the protection of the privacy of all electricity retail customers. In particular the regulation will apply to any person who receives or collects any personal information relating to customers or potential customers. The regulations will impose restrictions on disclosure and use of that information by these persons, as well as imposing requirements on the collection and storage of such information. All licence holders will be required to include these requirements in any customer supply or connection contract. Consequently, all customers will, as a matter of contract, be able to enforce their rights to privacy.

The amending bill introduces important changes to the structure and operation of the electricity retail market in New South Wales. Without these amendments the Government will not be able to deliver a major plank in its electricity reforms commenced more than five years ago. The bill is all about giving customers choice, while building a strong consumer protection framework. I would be heartened to hear the Opposition's policy in this regard. I commend the bill to the House.

Mr D. L. PAGE (Ballina) [12.36 p.m.]: I would like to make a very brief contribution to the debate. The purpose of the bill is to extend the right to enter into negotiated contracts for the retail supply of electricity to all customers by removing the current distinction between franchise and non-franchise customers and make savings and transitional provisions enabling the phasing in of full retail competition. From my experience in my electorate, the sooner we get full retail competition into the New South Wales market the better. I represent an electorate that is served by NorthPower. So far as my constituents are concerned, and I agree with them, we need an alternative to buying power from NorthPower.

It is becoming a daily occurrence in my electorate office for people to ring up to be added to the list of people who have complained about the lack of reliability of service provided by NorthPower. The number and frequency of power outages that are occurring in my area are totally unacceptable. People have rung me up and told me that they have had no power for 19 hours, and sometimes longer. One fellow had fruit in a cool room that was ready to go to market. The power went off and, as a result, the fruit was endangered. We need competition with NorthPower in our area. I know that the Minister must share some of my concerns because he has announced an inquiry into the performance of NorthPower in the Clarence and Richmond valleys.

Mr Yeadon: Indeed I have.

Mr D. L. PAGE: Indeed. I welcome that. I take this opportunity to ask the Minister, as I have done privately in a letter, to extend the terms of reference of the inquiry to include all the areas north of the Clarence Valley right through to the Queensland border. I know that the honourable member for Lismore will make a contribution in a moment. He and I share a common view on this issue. We would like to see the inquiry extended to cover all of that area. NorthPower has increased its access fee four times in the past twelve months. Part of the access fee is supposed to go towards maintaining the network, yet the number of outages seems to have increased. Something is not right. If the Minister can, he should extend the inquiry to encompass our areas. I take this opportunity to explain that I am in no way being critical of the Public Relations Officer for NorthPower, Mr John Sheather.

Despite the problems NorthPower has, which are beyond his control—he is not in charge of the maintenance side of things at all, but he is on the receiving end of all these complaints, including complaints from local members like me—he could not be more co-operative in the way he tries to handle such complaints. John Sheather is doing a fantastic job on behalf of NorthPower in extremely difficult circumstances and I would not want my comments to be in any way interpreted as being a criticism of his performance. He is helpful, always returns calls and is only too happy to follow through on complaints, and in many cases he delivers outcomes.

People in the Tweed area particularly are keen to have contestability put in place because, as I understand it, they must buy their electricity from Queensland. They want to be able to access cheaper electricity in the New South Wales market. Despite past negotiations with the Government, it appears that has not progressed to any great extent. Various people in the Tweed have sought my support to see whether contestability can be improved so that they are able to access Queensland power, which is cheaper at present and probably more reliable than that supplied by NorthPower. I ask the Minister in his reply to address particularly the possibility of extending the inquiry to include all those areas north of the Clarence Valley as the constituents I represent would be most grateful.

Mr GEORGE (Lismore) [12.41 p.m.]: Like the honourable member for Ballina I express my concern, from a consumer's point of view, that competition in the electricity market certainly is needed. Electricity supply is a major concern also to my electorate and was the reason I gave notice of motion on 10 August as follows:

I trust this bill covers those aspects. As the honourable member for Ballina said, a number of complaints have been received about electricity services. Rationalisation is to provide cheaper electricity, but clearly that has not happened. Instead, the reverse has happened as maintenance and standards have dropped along the way. It is a cause for concern and is typical of complaints I receive in my electorate office. Yvonne Cooper, who lives in the Trageagle area, since May has experienced 49 interruptions to her power supply that have been recorded by her fax machine. Sadly this is not acceptable. Dr William Nardi wrote to me expressing his concern about NorthPower as follows:

the Northern Rrivers Electricity group—

This is typical of complaints honourable members in the northern areas receive. NorthPower has defended its track record on power supply reliability in the Richmond Valley areas while at the same time assuring customers that it is taking complaints seriously. Like the honourable member for Ballina I give credit to John Sheather and the people on the ground in the Lismore electorate who work hard at trying to fix the problems. However, the Minister for Energy has been made aware of the problems and I am pleased he has been prompted to investigate them. He has asked NorthPower to report to the Government about reliability, recent blackouts and customer complaints. In the Minister's own words, "There is reasonable expectation from the public to receive a reliable power supply." I trust that this bill will go a long way towards solving the problems, including competition problems, but the Minister must take all necessary steps to maintain services to avoid the unacceptable power failures and faults being experienced consistently in the Lismore electorate.

Mr STONER (Oxley) [12.47 p.m.]: The Electricity Supply Amendment Bill will achieve a number of purposes, including: ensuring that all electricity customers have the right to choose their retailer whilst offering consumer protection to customers who seek it, a positive step; establishing the Electricity Tariff Equalisation Fund to manage financial risks faced by retailers in a deregulated market, about which the Coalition is concerned; granting extended powers to the Independent Pricing and Regulatory Tribunal in relation to electricity beyond December 2000; ensuring that residential customers have access to an ombudsman scheme, another positive move; ensuring privacy of customer information and a marketer's code of conduct, which is also welcomed; and establishing necessary market rules to allow customers to switch retailers, a commonsense and welcome provision.

Other honourable members from the North Coast and mid North Coast have spoken about NorthPower and the fact that customers within the area it services, which includes the Oxley electorate that I represent, do not have a choice of electricity retailer. They are only able to deal with NorthPower. I mirror the views raised by those honourable members. Unfortunately, a higher proportion of complaints and constituent inquiries through my office relate to the services provided and the fees charged by NorthPower.

There are complaints about the level of service. The infrastructure in the area is ageing and is inadequate for a large and expanding regional area on the mid North Coast. Fees are rising when service levels are declining. Of particular concern to my constituents are access fees. Despite NorthPower's efforts to explain these things away there are consistent inquiries about why customers should be charged to have people read their meters. I try to explain but NorthPower has had a public relations disaster in this respect. In a situation of full retail contestability this issue could cause customers to look to another retail provider. While the Minister is in the Chamber I would like to refer to a couple of hot spots for complaints in relation to NorthPower. Eungai Rail, which is situated between Kempsey and Macksville, is at the southern end of the old NRE line and at the northern end of the former Oxley County Council line.

Mr Yeadon: Let us not get too parochial. The bill is about retail contestability, not NorthPower services. I do not want to take a point of order but I will if you become too parochial.

Mr STONER: Okay. This is an area where I have had many complaints. It is an example of infrastructure issues that must be addressed. Hopefully, with full retail contestability this will be the case. We have hopes for development, growth in employment and utilisation of technology in rural and regional areas. The Internet presents many opportunities in country areas. Unless there is an efficient system of electricity under which people are not frequently cut off for extended periods, our hopes will not be achieved and the advantages will not be grasped. At Rollands Plains and Telegraph Point there are number of people in aquaculture and dairying and working from home offices. A reliable power supply at a reasonable rate is a vital economic consideration.

NorthPower fees and charges have gone up over recent years. I was paying a two-monthly bill of the order of $200. My bill—I have a fairly large family, with five children—is now over $300. The situation is much worse for low-income earners, many of whom reside on the mid North Coast. There are many pensioners in towns such as Urunga and Nambucca Heads. They have told me stories of huddling under blankets during winter because they cannot afford increased power fees. I have written to the Minister about this and to the Independent Pricing and Regulatory Tribunal. Round and round we go, all the fees are justified, but there will be no solution to the issue until there is competition in electricity retailing. This is why this bill is so important in delivering that. I hope it will be delivered to retail customers on the mid North Coast as soon as possible.

Previous speakers have mentioned John Sheather and the staff of NorthPower. I have no criticism of them: they are trying to make the best of ageing infrastructure and explaining how they are delivering services. But at a time of declining standards and increasing fees, the announcement of payment of an annual salary of $425,000 and a performance bonus of $106,000 for the chief executive officer got some people's backs up. Why should he be rewarded in that way when fees are rising and standards are declining? I hope the bill, which introduces competition, will give electricity customers in my area a choice and will assist to lift the game of the existing retailer.

As I mentioned, the Electricity Tariff Equalisation Fund was of concern to the Coalition. I understand that a similar policy known as economic purchasing groups was introduced in Queensland. However, it has subsequently been withdrawn as the Queensland Government was exposed to risks resulting in substantial losses of up to $500 million. On a balanced overview of the bill, it is not opposed by the Opposition. However, I ask the Minister to take heed of the concerns I have raised.

Mr YEADON (Granville—Minister for Information Technology, Minister for Energy, Minister for Forestry, and Minister for Western Sydney) [12.56 p.m.], in reply: I thank members who have contributed to the debate. I am still not exactly sure whether the Opposition supports the bill. One can only be bemused by much of the contributions from Opposition members. They support a regulated tariff and customer protection but seem to have trouble with one of the key mechanisms that would ensure a regulated tariff and the management of risk, that is, the Electricity Tariff Equalisation Fund. This is their Achilles heel. They change leaders on the run and change policy on the run. In the lead-up to the last election that type of approach on electricity was their undoing. They have not learnt anything in the intervening couple of years. They appear to be making electricity policy on the run and trying to have a bob each way.

The Carr Government is committed to reform in the energy sector, and this bill is an important part of delivering on that commitment. The bill is all about consumer protection, including the Electricity Tariff Equalisation Fund. The fund simply allows us to offer regulated prices for small customers who want them. The Opposition appears to support that. The Opposition should be clear that the Electricity Tariff Equalisation Fund is designed to ensure that customers can be offered choice as they support a regulated tariff if they do not choose to go out into the contestable market. The Opposition clearly does not understand how the fund will work. The Opposition is wrong when it says that generators will not be able to top up the fund when the pool price is high. That is wrong. The generators pay into the fund only when they are receiving higher prices, a situation which they will be able to sustain for a number of years.

It should be made crystal clear that the scheme operating in Queensland—a number of Opposition members have referred to it—is completely different from what is proposed in the bill. What was originally recommended for Queensland was a set of arrangements that are very similar to those in the bill for New South Wales. However, the arrangements recommended in Queensland were not implemented. Instead of implementing the recommended arrangements that protected the retailers from financial risks of buying electricity for regulated customers, the Queensland Government left Queensland retailers exposed to the pool.

That has resulted in the Queensland Government having to pay significant compensation to its retailers. The ETEF is designed to deal with precisely that problem. Had the recommended arrangements been implemented in Queensland, retailers would have been protected and the Queensland Government would not have been financially exposed, as it ultimately was. We can do two things to deliver a regulated price to small customers. The Opposition clearly supports a choice, not only amongst retailers but also between a regulated tariff or entry into a contestable market. We can do nothing and leave retailers exposed to the risks in the electricity wholesale market. No-one wants that. That is what occurred in Queensland and taxpayers had to pick up the bill. Regulated prices have to be supplied to regulated customers.

On the other hand, the risk can be managed through a mechanism such as the fund proposed in the bill. The Opposition has come up with no alternative because it does not have one. It has tried to take a political position on the bill when it is, in fact, policy bankrupt; it has no alternative proposition at all. Indeed, if one follows the argument of the Opposition to its logical conclusion, it seems to be almost recommending that we do the same thing as Queensland. The New South Wales Government will not do that because that policy did not work well in Queensland.

To do nothing would mean that New South Wales would end up with a system similar to Queensland, where taxpayers picked up the tab. I will not do that. In its haste to find something wrong with the bill the Opposition has said that it may not support it because it is too much like the arrangements put in place in Queensland. In fact the opposite is the case. Indeed, I am unclear on whether the Opposition is supporting the bill. Not only has the Opposition confused what was recommended in Queensland with what exactly was put in place, it now advocates that the New South Wales Government should put in place the very arrangements that it criticises. The fund has been specifically designed to manage the financial risks of retailers and to ensure that they can offer regulated prices to customers in a commercially sustainable way.

The honourable member for Myall Lakes spoke about references to the Independent Pricing and Regulatory Tribunal [IPART]. It is appropriate that those references come from the portfolio Minister who has carriage of and responsibility for customer protection, as opposed to the Treasurer, who is the shareholder, or, indeed, any other shareholder Minister. The responsibility of the shareholder Minister is to look to at the bottom line of commercial entities. The role of the portfolio Minister is to look to the protection of customers. The role of the IPART in regulation is about providing a safety net for customers; it is not about shareholders managing to achieve the best outcome for businesses. That is why it is important that references come from the Minister responsible for regulating the industry and ensuring that customer protection works effectively for small customers.

I shall conclude by mentioning NorthPower, which has been raised by a number of members. It is clear from the contributions of a number of members opposite that they do not understand the electricity industry or the distinction between retail and network services. Competition among retailers has implications for access charges and so forth, but reliability is up to the network operator rather than the retailers. That is why the Government is moving towards the separation of retailers and network operators. However, it is not trying to second-guess or outflank the IPART. The concept of separation is clearly understood by everyone, and the IPART will deliberate upon the details of that separation. In the first instance in this bill network operators and retailers will be as one in those geographic areas in which networks have traditionally operated. I thank all honourable members who contributed to the debate and I commend bill to the House.

Motion agreed to.

Bill read a second time and passed through remaining stages.

[Mr Speaker left the chair at 1.05 p.m. The House resumed at 2.15 p.m.]

ASSENT TO BILL

Assent to the following bill reported:

STATE REVENUE LEGISLATION FURTHER AMENDMENT BILL

Second Reading

Debate resumed from 15 November.

Mr O'DOHERTY (Hornsby) [2.19 p.m.]: I lead for the Opposition and indicate that it will not oppose the bill, which amends the following State revenue Acts: the Duties Act, the First Home Owner Grant Act, the Land Tax Management Act, the Pay-roll Tax Act, the Stamp Duties Act and the Taxation Administration Act. It is an omnibus bill which contains a range of measures to tidy up matters that have come to light as a result of proceedings before courts and in the course of the daily business of the Office of State Revenue. The bill also makes certain consequent amendments to various minor Acts, and it makes a minor change to the State's stamp duty reduction scheme for first home buyers, First Home Plus.

When dealing with an omnibus bill there is always a danger that a small detail will be missed. The Opposition did not have any prior warning of these matters before they were raised by the Minister in his second reading speech last week. Since that time we have had the benefit of a briefing by advisers from the Office of State Revenue and an officer of the Treasurer's office. I thank them for that. In relation to these matters, especially when they are likely to be non-controversial and when there is an element of detail that would benefit from wider consultation in the community, it would assist if the Government were to provide some advance warning to the Opposition and to community groups generally about what it is planning to do.

A few days, even the five days required under the standing orders between the introduction of a bill and the time when it should be debated, is a fairly small amount of time to engage in detailed consultation with the community. The Opposition sought responses from a range of people in the business community and the community generally. I am pleased to advise the Government that no great concerns have come to light during our inquiries. However, should any come to light before this bill goes to another place, the Opposition may move amendments in that place. I make that general point because a lack of consultation is the bugbear of all shadow Ministers. The Government may think this is being clever, but my view is that it impedes the democratic process.

That having been said, the bill contains a number of provisions, none of which the Opposition objects to. There is the concession for transfer of property to a related person, an amendment under the Duties Act 1997. The one issue I raised with the advisers from the Office of State Revenue in relation that matter related to the word "contemporaneously", which appears in the briefing notes that the department had prepared and which the Minister tabled for the information of members after his second reading speech.

How will the term "contemporaneously" be applied? The Opposition hopes it will not be applied in such a way as to prevent people who have made a genuine error in putting one person's name on a purchase agreement from changing their minds after taking advice from their accountants. Obviously there will be occasions on which it will be reasonable for people to change the name on an agreement prior to exchange taking place, in relation to property for example. The Opposition hope that is not a device by which the Office of State Revenue can grab additional stamp duty. We want to stop people who deliberately try to rort the system by entering into an agreement in one name and completing it in another. That was discussed during the briefing and it is my understanding that the definition to be applied will be "prior to settlement". The Government advisers are nodding in agreement, so having raised that objection we do not quibble with the outcome.

The bill contains many measures, and I will not comment on all of them as the Opposition does not oppose the bill. However, I will comment on the Government's first home owner scheme, First Home Plus. That scheme provides stamp duty exemptions or concessions, depending on the value of the property and according to the location of the property. To be eligible for concessions the current thresholds for the metropolitan area are $300,000 for a dwelling and $140,000 for vacant residential land. For regional areas the thresholds are $250,000 for a dwelling and $110,000 for a block of residential land. To receive a full waiver of stamp duty the purchase price thresholds are $200,000 for a dwelling and $95,000 for a vacant block of land in metropolitan areas, and $175,000 for a residence and $85,000 for a vacant block in regional areas.

Our concern was whether the definition of "metropolitan area" was wide enough to cover the property market for the greater Sydney area. The Real Estate Institute has advised me that it raised that matter with the Government, claiming that Lake Macquarie and Newcastle should be included in the scheme on the basis that average property prices in those areas have risen. The Government responded by including the two areas in the scheme, and the Opposition agrees with that. However, I was interested to investigate whether that should be the extent of the definition of "metropolitan area." I had a number of interesting discussions with members of the Coalition who represent regional areas.

For example, I have discussed property prices with the honourable member for Orange, and I know he has had discussions with his constituents about the scheme. The honourable member for Coffs Harbour reminded me that property prices north of Newcastle are approaching the threshold barriers. We have discussed whether the thresholds for regional areas are appropriate, and whether they encourage young people to purchase homes and qualify for the stamp duty waiver contained in the bill. After further discussion with the Real Estate Institute we concluded that the current thresholds appear to be adequate. I am sure it is the Government's intention—it would certainly be ours—to continue to monitor the thresholds to make sure that the scheme meets the purpose for which it was designed.

The purpose of the scheme is to assist young people into homes. If assistance is to be provided, that assistance ought to be equally available to young people who purchase homes in regional areas as it is to those who purchase homes in the metropolitan area of Sydney. I do not need to remind the House that we need to do everything we can to encourage young people to stay in regional areas and start their families and establish businesses there. If we do not, our country towns will die. If we can maintain a good population base in regional centres such as Orange, the banks will not pull out: they will have a customer base that is readily accessible, and businesses will have access to a reliable work force.

The Opposition will continue to monitor the thresholds under the scheme—I hope that the Government will do the same—to make sure they meet the needs of first home purchasers, particularly those young people who want to start families. If necessary, the Opposition will propose changes to the scheme further down the track. The bill contains a number of provisions that relate to group companies. A brief summary of the provisions is that they ensure that group companies cannot hive off their liabilities for State taxes by setting up a holding company and ensuring that taxable activity takes place within that holding company. I sought further advice about that from the Minister's office. I have been advised that the provisions of the bill are similar to, or mirror, Commonwealth legislative provisions. I believe that is fair.

One important matter about taxation is the fair application of the principles. Those who are obliged to pay tax should pay it. People who pay tax should not have to pay more than they are obliged to. The important principle, therefore, is to make sure that people do not escape their responsibilities to other citizens. The Opposition does not oppose those provisions. The Opposition is pleased about the changes to the constitution of the Hardship Review Board. It is good to be compassionate when applying State revenue measures or, indeed, all taxation measures. With those brief comments I am pleased to advise House that the Opposition will not oppose the bill. I repeat that should an anomaly come to light in our ongoing consultation with the business community on what are sometimes complex matters we may seek to amend the bill in the Legislative Council. However, I do not believe that prospect is likely.

Ms NORI (Port Jackson—Minister for Small Business, and Minister for Tourism) [2.29 p.m.], in reply: I thank the honourable member for Hornsby for his contribution to the debate. I commend the bill to the House.

Motion agreed to.

Bill read a second time and passed through remaining stages.

BANANA INDUSTRY AMENDMENT BILL

Second Reading

Debate resumed from 31 October.

Mr SLACK-SMITH (Barwon) [2.30 p.m.]: The purpose of the Banana Industry Amendment Bill is to alter the regulatory functions of the Banana Industry Committee [BIC] to remove the anti-competitive aspects consistently with national competition policy, to remove the power of the committee to give directions as to the transportation of bananas and to clarify the provisions of the Act relating to the voting entitlements of banana growers in respect of the election of regional members of the committee. The Banana Industry Bill was introduced in 1969, without any slip-ups, to introduce statutory powers to regulate the marketing, quality, transportation and distribution of New South Wales bananas. It also imposed compulsory charges on growers for research of disease, pest control, marketing promotion, quality assurance and industry information.

This bill clarifies the voting entitlements of the Banana Industry Committee. This bill amends the Act to allow the Banana Industry Committee to continue to compulsorily charge the industry for research and development. However, it removes the committee's responsibility for transportation, distribution, quality and marketing of bananas. This will now be driven by market forces, as it should. This bill also restores to individual growers the freedom to make arrangements with respect to quality and quantity of supply and control whilst taking a responsible whole-of-industry approach to research and development. The Opposition will not oppose this bill.

Mr NEWELL (Tweed) [2.32 p.m.]: I appreciate the fact that the Opposition does not oppose the Banana Industry Amendment Bill. The bill amends the Banana Industry Act to fulfil this Government's commitment under the competition principles agreement and to improve several other aspects of the legislation at the request of the industry. Essentially, the bill amends legislation that passed through this Parliament in 1998, if my memory serves me correctly—I was not a member of Parliament at that time. I understand that bill sought to make similar changes to those proposed this time regarding transportation of bananas. As mentioned by the honourable member for Barwon, who led for the Opposition, the Banana Industry Committee [BIC] will continue its existence without change of name or changes to its general industry service functions and powers, such as pest and disease control, research and development, and grower education and information promotion. The committee will retain industry representation as part of its functions.

These industry service functions yield net public benefit and are strongly supported by the banana industry. The Banana Industry Committee's power to impose compulsory charges is also retained. This power remains subject to industry affirmation under grower polling arrangements to ensure ongoing industry support for the services being provided. Pursuant to the competition principles agreement the bill proposes to remove the power of the BIC with respect to the regulations of the banana market such as those to impose supply or quality control measures. Some of these powers address issues that are no longer relevant to the industry whereas others address issues that are best left to the market to resolve, for example, issues of product quality. This approach is in accordance with the principle of best practice regulation as issues of quality control can be addressed through non-legislative means such as an industry code of practice or quality assurance and accreditation.

The bill will amend the Banana Industry Act to alter the regulatory functions of the Banana Industry Committee to remove anti-competition aspects and particularly to remove the power to give directions regulating banana transport. It is my understanding that in 1998 the Legislative Council amended the bill, with the help of some Independents, to keep that regulation. Regrettably, that meant that, with the regulation of transport, bananas were being moved from the North Coast to Sydney and southern markets. Though I was not a member of this Parliament at that time, costings given to me reveal that the major transport company, Lindsay Brothers, had the contract to market the bananas and was receiving something like $2,000 for a full truck of bananas, whereas subcontractors involved in transporting bananas were receiving something like $700 or at least much less than $1,000. The system allowed a fair bit of fat and waste to remain courtesy of amendments moved in the Legislative Council.

Mr Fraser: How would you know, you weren't even here!

Mr NEWELL: I shall tell the honourable member for Coffs Harbour how I know. I am a North Coast resident and I know many banana growers. I have taken a close interest in the banana industry since I was a young boy. I talk to a lot of banana growers and other people servicing the industry. It is on that basis that I recall that the major transport contractor—

Mr Fraser: Besides that, it's in the speech the Minister wrote for you.

Mr NEWELL: Let us go into this a little further. The amendments in the Legislative Council to hold the contracts in place and not remove the regulation on transport were moved with the support of the National Party at its behest and that of some Independent members. The honourable member for Ballina has a wry smile on his face—perhaps he might inform the House of his role in keeping the contracts.

Mr Fraser: That's not in the speech the Minister wrote for you.

Mr NEWELL: Exactly. This is all my knowledge of what happened in the industry. It does not all come from the department. It comes from members knowing what goes on in their electorate. That is why the electorate has elected Country Labor representatives.

Madam ACTING-SPEAKER (Ms Beamer): Order! The honourable member for Coffs Harbour will cease interjecting.

Mr NEWELL: If the honourable member for Ballina or anyone else who was here in 1998 wants to admit that they moved amendments to keep those regulations in place, they should by all means do so; if they want to deny it, they should do so. Again, I point out to the House that, because of those amendments, the industry was stuck with a contract that was anything but efficient. As I mentioned, the major transport contractor was being paid in excess of $2,000 to transport bananas but it was subcontracting to other drivers who were being paid less than $1,000. With that sort of fat and inefficiency in the industry there is little wonder that it got into trouble on the North Coast. The patronage of the National Party was able to keep that particular inefficient business in place. I thank the Minister for finally repealing that; it was part of an overall series of inefficiencies that were retained for whatever reasons and which led to much of the industry being inefficient and not being able to get the appropriate return for supply it deserved.

Back in 1998, Lindsay Bros. Transport, or subcontractors, transported three million packages of bananas from the North Coast and southern markets. This year that figure is down to half, about 1.5 million. Regrettably, there has been a substantial decline in the industry. The inefficiencies I have alluded to did not help the industry retain its competitive edge. The banana industry is also under threat about the likely imports of fresh bananas from the Philippines. Mr Ron Gray, Chairman of the Banana Growers Council, which is based in Brisbane, has invited all members, including probably the honourable member for Ballina and the honourable member for Coffs Harbour, to a forum next Wednesday. In a letter to me, Mr Gray states:

We will be inviting all your banana colleagues to discuss the very serious issue of imports of fresh bananas from the Philippines.

He goes on to say:

We will background you on this issue that has the potential to see an end to banana growing in this country. New South Wales has of course been a major producer of fresh bananas in this country for over 150 years. In some communities it is a way of life, in others it is a valuable tourist attraction.

That comes from the banana industry itself. The industry is very concerned about the likely imports of bananas. I raise that issue in the House to remind honourable members of the concerns and fear of the banana industry about the assessment on importation of bananas from the Philippines. The industry is fearful of the long-term implications. One further aspect I want to raise is in relation to marketing arrangements. Just the other day I visited a vegetable grower in my electorate who raised with me an issue that I know has always concerned banana growers. I refer to the return on produce that growers gets from merchants or agents in Sydney and Melbourne. The merchants and agents are able to virtually decide whether they operate as a merchant or an agent. In this case the vegetable grower made a phone call to an agent to negotiate a price. The agent nominated a price of $10 or $15 for a carton of fruit or vegetables. Lo and behold, two days later the grower reads in the paper that the produce sold for $25 or $30. Because the agent acted as a merchant, the grower did not get anything like the return that was broadcast through the media.

Merchants and agents have the flexibility to flick between one or the other. If the grower sends produce to an agent, the agent sells the bananas or tomatoes and the grower gets the market price on the auction floor. But if the agent acts as a merchant, the merchant nominates a price to the grower and the grower is stuck with it. The marketing system of merchants and agents has been abused. The growers have been ripped off and it is causing a great deal of stress. This situation has not suddenly occurred. It is one of those anachronisms that has been allowed to remain in place for a long time. Although the issue does not have direct implications in this bill, it affects not only growers in my electorate but anyone who grows vegetables and fruit and sends produce to market. I would very much like this Parliament to address that issue.

I support the bill. As I have indicated, it is well beyond time that these changes were put in place to remove the monopolistic role of the transport industry in the banana industry. No other industry has had a provision which precludes others being involved in the transportation. As I have illustrated, the inefficiencies that remained in the system through the Act allowed certain people to take advantage of the situation to the detriment of the growers. I commend this bill to the House.

Mr PRICE (Maitland) [2.45 p.m.]: I will speak briefly in support of the bill, particularly on the amendments to the transportation of bananas and the proposed deregulation. Whilst the Banana Industry Council's power to regulate for the transport of bananas has been in place for many years, and came before this Parliament once before, I am pleased to see that since the council has not made a particular transport direction since 14 June, this bill can proceed to eliminate that practice from now on. I also refer to the setting of grower charges and the allocation of the Banana Industry Council's annual budget. The requirement for the Minister to authorise that by signature has caused some problems over the past several years.

This bill will give the councils sufficient flexibility to respond to situations that occur from time to time on the ground in their areas and obviate the need for the Minister to be involved in making those decisions, which are redundant in this day and age. I support the removal of the clause from the bill. As we are a democratic nation, it is great to see the elimination of anomalies in the election process for banana growers. We have all had enough of distortions of the democratic voting process over the past few weeks with the American presidential election. I am sure that the banana growers consider their situation equally important. Those anomalies will now be removed; a statute law revision will put that in place. I support the bill and I look forward to its early implementation.

Mr AMERY (Mount Druitt—Minister for Agriculture, and Minister for Land and Water Conservation) [2.47 p.m.], in reply: I am pleased to respond to the debate on the Banana Industry Amendment Bill. I thank the Opposition for its support of the legislation, and its acceptance, with qualifications, that certain regulations need to be repealed and that a number of safeguards in the legislation will assist the industry, particularly the various service functions. The establishment of codes of practice for quality control was addressed by the honourable member for Barwon and the honourable member for Tweed. I would also like to thank the honourable member for Tweed and the honourable member for Maitland for their contributions, which clearly show why Country Labor is doing so well in regional areas.

Mr Fraser: You are as nasty as Neville was.

Mr AMERY: The honourable member for Coffs Harbour refers to the honourable member for Tweed, who clearly showed his in-depth knowledge of the industry, which came about as a result of not only from living in the Tweed area but also from his negotiations and discussions with the banana industry. The honourable member for Tweed raised an interesting point in relation to marketing arrangements, some of which are subject to deregulation and others to codes of practice. He raised the issue about the price being paid to growers as opposed to the price being achieved at the market. He referred to merchants and agents.

Mr Fraser: That is outside the leave of the bill.

Mr AMERY: No, it is not. The honourable member for Coffs Harbour should look at the marketing arrangements. When the honourable member spoke to the issue I thought he was outside the leave of the bill, but on second glance I see that the arrangements are well within the confines of the bill. It is interesting that the honourable member raised the price paid to the banana growers on the North Coast as opposed to what is paid for them at market. This matter has been raised time and time again by Country Labor. As a result of the debate about what is paid for apples through supermarkets, we set up a round table with industry.

I was advised during the contribution of the honourable member for Tweed that the banana industry is represented at the round table, which this Government established a short time ago. Various discussions are being chaired by New South Wales horticultural program leader, Doug Hocking. It is difficult for me to predict at this stage whether any legislation can correct the inequity of the price paid to growers and farmers for their produce compared with what is paid for them by consumers. Labor Governments have always been called upon to deal with this problem.

History shows, and my research and recollection show, that the matter was raised in 1925 when J. T. Lang announced as part of his election policy that his government would investigate ways to limit the margins between what producers receive for their products and what consumers pay for them—in other words, he said that he would curb the activities of middlemen and profiteers. As a result of that promise a conference was held at Bathurst in September 1926 and this Parliament passed the Marketing of Primary Products Bill, which was introduced in 1927. Obviously, the matters raised by the honourable member for Tweed have been dealt with by some changes to legislation. In some areas they are still a major problem. This Labor Government is still trying to overcome the problems in the banana and apple industries.

I will refer the honourable member for Tweed's speech to the round table and ask Mr Doug Hocking to respond to him and advise him whether our retailers, agents and producers are reaching a better understanding. I thank the honourable member for Maitland for his contribution to the debate. He was very cautious about what we are repealing, but he is now satisfied that the residue of the legislation will allow the industry to continue with its various service industry obligations. Transport problems have now been resolved, despite the fact that this is the second time it has been debated in this Parliament. I commend the bill to the House and thank all honourable members for their contributions.

Motion agreed to.

Bill read a second time and passed through remaining stages.

CROWN LANDS AMENDMENT (COMPENSATION) BILL

Second Reading

Debate resumed from 17 November.

Mr J. H. TURNER (Myall Lakes) [2.53 p.m.]: The Opposition will not oppose the legislation. In 1997 in the case of Prince Alfred Park Reserve Trust v State Rail Authority the Land and Environment Court held that a Crown reserve trust manager, such as Sydney City Council, was entitled to market value compensation for compulsory acquisition of a leasehold estate in a reserve under its control. The Prince Alfred Park case can be taken to mean that the State Government has no entitlement to compensation for compulsory acquisition of Crown reserves where a trust is appointed. Prior to this case it was widely accepted that the Crown as the owner of the land, and not a reserve trust appointed under the Crown Lands Act, was entitled to the land value compensation. Two particular problems emerged from the Prince Alfred Park decision.

Firstly, the decision effectively enables a council to negotiate with itself when it is both the acquiring authority and reserve trust manager, therefore paying the State nil compensation. Such a case recently occurred at a reserve at Blacktown, resulting in differing opinion as to the Crown's entitlement to compensation. Secondly, when State agencies seek to undertake works on Crown reserves the trusts are using the Prince Alfred Park case to argue that they are entitled to substantial compensation payments from the State. This occurred recently at a reserve at Tempe acquired by the State Rail Authority for use in conjunction with the southern railway proposal.

The bill provides for an amendment to the Crown Lands Act 1980 so that when compulsory acquisition of a Crown reserve occurs the appointed trust manager has no entitlement to compensation for the market value of the land required. The bill provides for the Crown as owner of the land in fee simple to be entitled to compensation. Although the bill provides compensation to the Crown the trust would be entitled only to the value of any improvement which that trust has erected or caused to be erected on the Crown reserve, the reduction in value caused by severance of the land and the loss attributable to disturbance.

The bill will not apply to land where the purpose was dedicated and a Crown grant issued prior to 1980. Trusts that fall into this category have a certificate of title with trust members nominated on the title. Any acquisition of Crown reserve land under the Roads Act 1993 or the Pipelines Act 1967 are to be acquired in accordance with those Acts, but compensation paid is in accordance with the bill. The proposed bill merely reinstates the political position that was rightly accepted prior to the Prince Alfred Park case. That is, the owner of the land is the body that should receive the compensation, not a trustee appointed by the owner.

The amendment would require no additional funding, and would enhance the ability of the Government to undertake State significant projects, and obtain market value compensation when councils compulsorily acquire reserves. Trustees are entitled to receive the value of any improvement that the trust erected or caused to have erected. In the spirit of consultation the Opposition, unlike the Government, has consulted the Real Estate Institute, the Institute of Surveyors, the Property Council of Australia and the Law Society of New South Wales on this important issue.

Ms HARRISON (Parramatta) [2.56 p.m.]: I support the Crown Lands Amendment (Compensation) Bill. As honourable members would be aware, the Crown Lands Act 1989 contains provisions that enable the Minister administering that Act—that is, the Minister for Land and Water Conservation—to reserve or dedicate Crown lands for particular public purposes. The Minister appoints reserve trusts to have care, control and management of those lands. These provisions have their origin in the Crown lands legislation and practice of the earliest days of settlement in New South Wales. For example, the Crown Lands Consolidation Act 1913 and the Crown Lands Act 1884 were both Acts of this Parliament preceding the current Act.

At present more than 32,000 separate Crown reserves cover more than 3 per cent of the State. These reserves are used for a wide variety of purposes, with key areas including environmental protection, recreation and essential infrastructure, local or regional parks and sportsgrounds, the conservation of flora and fauna, heritage areas, caravan parks, showgrounds, travelling stock reserves, coastal and foreshore reserves, public school sites, police stations and water supply. In my electorate of Parramatta the Lake Parramatta Reserves Trust is a very significant trust area. Reserves, with certain exceptions, are capable of being compulsorily acquired by State, local and Federal authorities with powers of compulsory acquisition.

At present numerous Acts of Parliament confer compulsory acquisition upon Ministers of the Crown, statutory corporations and local government. The machinery provisions utilised to effect these are contained in the Land Acquisition (Just Terms Compensation) Act 1991. Under this Act the right to compensation for compulsory acquisition is conferred upon owners of interests in land. Until recently there had been a widespread, although not entirely uniform, view within government that a reserve trust appointed under the Crown Lands Act in respect of a reserve was not the owner of an interest in the land comprising the reserve and was not, therefore, entitled to compensation when the land was compulsorily acquired.

The bill will circumvent an anomalous situation that has occurred since a judgment in the Land and Environment Court in Prince Alfred Reserve Trust v State Rail Authority of New South Wales in 1997. The case concerned the compulsory acquisition of a lease by the State Rail Authority over a Crown reserve under the trust management of Sydney City Council. The court found that the trust was entitled to compensation equivalent to the market value of the acquired land. Since the Prince Alfred Park case considerable legal uncertainty has emerged as to the nature of compensable interest held by a reserve trust and the correct valuation approach to be adopted in measuring that interest.

The decision has been widely interpreted by the Valuer-General in the determination of compensation and by acquiring authorities, particularly local councils, as authority for the view that the State Government has no entitlement to compensation for compulsory acquisition of Crown reserves where a trust is appointed. This is particularly relevant when the local council is both the acquiring authority and the reserve trust manager. This allows the council to negotiate with itself as trust manager and acquire the reserve under its control for nil compensation. Such a case recently occurred with a reserve in Blacktown. Council compulsorily acquired land from a reserve over which it was the trust manager. The Valuer-General assessed the Crown's entitlement as nil, while private valuation advice assessed it as closer to $100,000.

Another problem since the Prince Alfred Park case is when State agencies seek to undertake works on Crown reserves where a trust is in place. The trusts are using the case to argue that they are entitled to substantial compensation payouts from the State on State-owned land. This has also occurred recently at a reserve in Tempe which is to be acquired by the State Rail Authority for use in conjunction with the southern railway proposal. This amendment will remove just such anomalies. It is justifiable on the basis that the Crown is the owner of the land and therefore the party with the entitlement for compensation attributable to ownership of the fee simple estate. I commend the Minister for Agriculture, and Minister for Land and Water Conservation for bringing this bill before the House, a bill which will enhance the Government's ability to undertake projects of State significance and to obtain market value compensation where councils acquire reserve lands.

Mr MILLS (Wallsend) [3.01 p.m.]: I am pleased to support the Crown Lands Amendment (Compensation) Bill. In considering this bill it is worth bearing in mind that the system of reserves and trusts over Crown lands—as a good republican I would rather call them State-owned lands—had its origins in the early days of British colonial settlement. The bill results from a 1997 Land and Environment Court decision which has become known as the Prince Alfred Park case. The court held that a Crown reserve trust manager was entitled to market value compensation for compulsory acquisition of a lease in a reserve under its control. The Prince Alfred Park case has resulted in considerable legal uncertainty as to the nature of a reserve trust's entitlement to compensation, and the correct valuation approach to be adopted in ascertaining the respective interests of the Crown and a reserve trust in acquisition cases. Two particular problems have emerged from the decision. Firstly, where a local government council is both the acquiring authority and the reserve trust manager it is able to negotiate with itself to compulsorily acquire the reserve under its control, paying the State nil compensation.

Mr Amery: Even then they get an argument.

Mr MILLS: I would have thought that we could have a John Cleese feature movie on the situations that could emerge from what has happened in recent years. Secondly, where State agencies seek to utilise Crown reserves, trusts are seeking substantial compensation payments from the State. The Land and Environment Court found itself, in cases since the Prince Alfred Park case, wrestling with concepts of discounting land values and dividing compensation between the State and the trust, the local council. Until the legal entitlement of a trust to compensation is determined with certainty the Government will continue to encounter difficulties such as those mentioned.

The bill contains amendments to the Crown Lands Act 1989 to provide that where compulsory acquisition of a reserve occurs the trust has no entitlement to compensation for the market value of the land acquired. The amendment is justifiable on the basis that the Crown is owner of the land and therefore the party with the entitlement for compensation attributable to ownership of the fee simple estate. This amendment does not seek to alter the entitlement of a trust to compensation under any of the other heads of recovery under the Land Acquisition (Just Terms Compensation) Act. For example, a trust could be entitled to claim for things such as special value and disturbance, the value of any improvement the trust had erected on the reserve or a reduction in value caused by severance of the land or by loss attributable to the disturbance of the trust's asset on that land.

Any existing leases or licences over the Crown reserve granted by the trust and terminated by compulsory acquisition are not entitled to be the subject of compensation. There is an existing provision to this effect already in the Crown Lands Act 1989. The bill will not apply to land where the public purpose for the land was dedicated and a Crown Grant issued prior to 1980. Trusts which fall into this category have a certificate of title issued by the Land Titles Office with the trust members nominated on title. If Crown reserve land is compulsorily acquired under the Roads Act 1993 or the Pipelines Act 1967 the acquisition is to be in accordance with those Acts but compensation is to be paid in accordance with this bill. That is, the Crown is to be deemed the holder of the fee simple estate and the reserve trust the owner of the improvements and structures.

The bill strikes an equitable balance between the interests of the State and trusts in reserves which are compulsorily acquired, and merely seeks to reinstate the legal position that was widely accepted prior to the Prince Alfred Park case. The bill requires no additional funding and will have no impact on native title. Consultation has been undertaken with the Local Government and Shires Associations and with the Minister for Transport. In summary, the bill will make certain that the State, as owner of the land, and not the reserve trust is entitled to compensation for the market value of the land acquired. I commend the bill to the House.

Ms MOORE (Bligh) [3.06 p.m.]: I speak on the Crown Lands Amendment (Compensation) Bill because I am concerned about it. It seeks to provide legal certainty in situations in which compensation is payable for the compulsory acquisition of reserve lands. The Parliamentary Secretary to the Minister for Land and Water Conservation stated in the second reading speech that this bill is needed as a result of problems caused by recent Land and Environment Court cases, particularly one in relation to Prince Alfred Park, which is in my electorate. He argued that there are two particular issues that need to be addressed. Firstly, the decision allows a body such as a local council to negotiate with itself where it is both the acquiring authority and the trust manager, potentially resulting in the State receiving nil compensation. Secondly, when State agencies are seeking to acquire Crown reserves reserve trusts are seeking substantial compensation payments from the State. The court has determined that the compensation is to be assessed according to market value principles.

It is the intent of the bill to address this problem by deeming the Crown rather than the reserve trust to be the owner of the land for the purpose of determining compensation payable. Any compensation received by the reserve trust will be restricted to the value of improvements to the land, reduction of the value of other improvements or loss attributable to disturbance. The bill will effectively allow reserve lands to be lost, with any compensation absorbed into State consolidated revenues. It will result in no adequate compensation for the reserve trust to acquire additional land to replace the lost land or to improve the value and amenity of the remaining, diminished public reserve. It will not require that the State allocate the funds for this purpose.

While I sympathise with the need for legal certainty to avoid protracted and unnecessary court battles, I believe that the direction of this bill is wrong and demonstrates a lack of commitment to protecting and preserving public land for the purpose for which it was reserved. The Government appears to believe that it is unacceptable for the Crown to pay compensation to reserve trusts. The Parliamentary Secretary stated in the second reading speech, "The point to reinforce here is that this is State-owned Crown land!" In fact, it is State-owned land that is dedicated and held in trust for the people of New South Wales for specific purposes, not for government purposes, such as environmental and heritage protection, recreation and sports, open space and parkland, and for infrastructure such as schools, police stations, showgrounds and water supply. In some cases in which the land may not have had a specific purpose initially it has become, over time, recognised for its important recreational, environmental or heritage role.

There is a critical need to increase open space in inner Sydney, which is being diminished and commercialised. Inner Sydney has the highest density residential areas in the State, with the lowest ratios of public and private open space per person. There is a vast urban renewal project planned for the nearby former South Sydney industrial area which will house an additional 20,000 to 30,000 people. I have asked the Minister for Urban Affairs and Planning for an audit of open space in inner eastern Sydney. It is 18 years since the then Department of Planning and Environment, with Bob Carr as its Minister, documented "Open Space in the Sydney Region, 1982".

This was at a time when the population in the inner city was decreasing. That situation has been reversed, with the trend towards increasing densities. I have called for the audit so that there can be a clear and co-ordinated basis for making decisions on further development and land use. The Minister has told me that the Government recognises the need to maintain and improve levels of service provisions for increasing the local population, including open space and recreational facilities. Despite this, the Crown Lands Amendment (Compensation) Bill will enable further encroachment on already limited open and recreational space, with no assurance that compensation funding will be available to purchase additional open space or increase the usability of existing open space.

I strongly support the need to solve the problem of a government authority or local council being able to negotiate with itself, as trust manager, the nature and terms of compensation payable for compulsory acquisition of reserve lands. There is a conflict of interest involved in a situation that encourages an authority or council to put its financial interest over and above the public interest. However, this legislation introduces a greater conflict of interest for the State in which the Government, for a short-term financial benefit, can trade off the long-term public benefit of reserve lands. In all compulsory reserve land acquisitions there must be a genuine and independent assessment of the public value of the land, with the possibility of appropriate compensation to replace or enhance remaining reserve space.

Therefore, I oppose the bill and ask the Government to go back to the drawing board. Although some reserve land is of limited public benefit, other land with environmental and heritage value, open space and recreational reserves are of high public benefit. This legislation should ensure that appropriate compensation is paid to enable the purchase of additional land of at least equal size and public benefit, or, where that is not possible, to enable improvement of the value and accessibility of the remaining diminished reserve. It should also ensure that funding is dedicated for this purpose and not lost into consolidated revenue or unrelated projects.

Mr AMERY (Mount Druitt—Minister for Agriculture, and Minister for Land and Water Conservation) [3.11 p.m.], in reply: I thank the Opposition for facilitating the passage of this bill through the Parliament. The honourable members for Myall Lakes, Parramatta and Wallsend referred to the reason for the introduction of the bill, that is, the Prince Alfred Park case before the Land and Environment Court. As a result of that case a different definition has been given to the owner of the land in question. The honourable member for Parramatta outlined the history of the legislation going back to 1884 and 1913. She referred to the use of Crown lands for recreational purposes and caravans as two examples. She highlighted the Parramatta Lakes Reserve Trust. I have some knowledge of that trust as I was a policeman between 1970 and 1983 and I spent 10 years at Parramatta. That reserve was part of my beat and all sorts of activities, family activities during the day and more questionable ones requiring police attention during the evenings, occurred there.

Ms Moore: I am sure that hasn't changed.

Mr AMERY: I do not know as I have not been there in recent years, but it was always a problem while I was a policeman. The honourable members for Wallsend, Parramatta and Bligh referred to those who run the trusts, and I take this opportunity to thank those people. The trusts may be large but there are also small trusts for school of arts halls, playgrounds in small country towns and small caravan parks. I have visited many trusts and spoken to numerous trust members. On occasion I have even presented awards for 20, 30 and even 40 years of dedicated voluntary service to Crown land trusts. Everyone should be grateful for the work that they do in the community.

The bill is probably not as wide ranging as the honourable member for Bligh would like. She would like a wide-ranging debate about her genuine concern about pressure being placed on Crown land reserves near to or in the city of Sydney, where they are precious and valuable. I use the word "valuable" in community terms rather than dollar terms. The honourable member for Bligh said that this bill is sending us in the wrong direction. The bill returns the situation to what it was before the Land and Environment Court threw a spanner in the works. Crown reserve trust members have never considered themselves to be the owners of the land that they administer. They are appointed for a certain period, they are reappointed, some retire and new ones are appointed. Governments have never considered that trust members own the land.

However, the Land and Environment Court has clearly demonstrated that in its view a trust owns the land. That is an incredible decision by the court. It is said that land owned by the taxpayer has been transferred to a trust set up by State legislation, such as the Crown Lands Act. For example, the Government on behalf of the taxpayers may decide to widen a road or a railway track or fix an intersection where accidents had occurred, and in order to do so has to use a section of Crown land owned by the Government. The Land and Environment Court has argued that the land is owned by the trust and that the Government should pay compensation for land that it already owns. In other words, the court ruled that taxpayers had to pay for land that has been reclaimed for their use but which they owned in the first place. That is an extraordinary decision. This bill clarifies the position. The honourable member for Bligh referred to the Minister for Urban Affairs and Planning in an effort to expand the debate. I do not think this is appropriate legislation to attract wide-ranging debate. The Government should be judged on what it has done to conserve reserves and set up national parks because it has exceeded its promise in that regard.

Mr Fraser: I wouldn't be too proud about that.

Mr AMERY: I am proud of the fact that this Government can boast that 30 per cent of the coastline of New South Wales is national park—and the budget for that is increasing each year. The honourable member for Bligh opposes this bill. She would like a number of debates about local government and planning issues. However, the purpose of the bill is to clarify who is the owner of Crown land and who is entitled to compensation. The honourable member for Wallsend made an interesting point when he talked about finding a balance. The Government acknowledges that many trusts raise funds of their own through raffles, fetes and access to reserves. Therefore, they are able to build facilities such as shower blocks. The honourable member for Coffs Harbour has showed me one such facility in his electorate and I am proud of that.

The bill includes a clause which, using my hypothetical example, states that if the Government takes land to widen a road or fix a dangerous intersection and in doing so removes an asset built by the trust through public or government fund raising, the trust would be entitled to compensation for the loss of that value-added facility. However, it is a bit rich for the Government to accept the decision of the court that taxpayers should pay compensation for the use of their own land. Whilst it may be tempting for the honourable member for Bligh to open up the debate in respect of many local issues within her constituency, this bill clarifies a legal situation in regard to the way we have been dealing with Crown land, all the way up until the Land and Environment Court made its decision.

Honourable members will be aware that there is a safeguard in relation to the removal of dedicated Crown land. I give notice of the proposed removal or dedication of Crown lands. Under the regulations, that can be subject to a disallowance motion in either House. I have been involved in those sorts of debates, not only as Minister but also as an Opposition spokesman. Honourable members may recall the Corowa common debate, which related to a proposal by the previous Government to facilitate the expansion of a golf course in Corowa at the expense of a local common. The Opposition, with the support of the crossbenchers, moved disallowance. The motion was not passed by this House but was successfully passed in the upper House. That particular removal of dedication was blocked by the New South Wales Parliament.

As I said, there is a parliamentary process to block any unreasonable removal of dedication and that is by disallowance motion in either House of the New South Wales Parliament. I cannot expand further on the contribution made by the honourable member for Bligh. I acknowledge her strong commitment to public reserves within her constituency and generally, but I do not believe this bill is the right instrument in respect of which to have that debate. I thank honourable members for their contributions and commend the bill to the House.

Motion agreed to.

Bill read a second time and passed through remaining stages.

WORKERS COMPENSATION LEGISLATION AMENDMENT BILL

Second Reading

Debate resumed from 23 November.

Mr THOMPSON (Rockdale) [3.22 p.m.]: This bill contains important amendments designed to enhance the efficiency of the dispute resolution system. New South Wales has the highest level of workers compensation claim disputes—approximately 30,000 disputes each year—of any jurisdiction in the country. Legal costs, therefore, have a significant impact on the scheme. At the current time more than $200 million is spent resolving disputes. It is also important to note that where a dispute arises, the matter usually is not resolved until several months after the workplace accident. As a result, injured workers experience delays in receiving their entitlements.

Of the 30,000 disputes, approximately 85 per cent resulted in payments to the injured worker. However, that usually does not happen until after a dispute has proceeded. It is not appropriate that workers be left without their entitlements for an extended period of time. Those injured at work have a right to compensation. What is just as important but often overlooked is that workers have a right to get their compensation as early as possible. The current legislation provides for the resolution of disputes through conciliation. Conciliation provides an opportunity for parties to resolve a dispute without the need for an imposed decision following costly and time-consuming litigation.

However, for conciliation to be effective, the parties to the dispute need to be ready, willing and able to participate. In other words, it takes two to tango and both parties need to come to the table with an attitude of preparedness to reach a sensible conclusion. However, only about 20 per cent of matters are actually resolved early in the dispute resolution process following conciliation. A change in culture amongst participants is needed to allow conciliation to reach its potential. While some participants have embraced conciliation, others have not moved from the adversarial approach, which relies on costly and time-consuming litigation.

The evidence shows that most disputes settle during court hearings without proceeding to judgment. I understand that this is likely to be because parties become aware of each other's case. The bill, therefore, provides for the exchange of information during conciliation. The bill endeavours to create an environment in which parties understand the matter more fully and are prepared to settle matters. Schedule 8 to the bill provides that when referring a matter for conciliation, the parties will need to identify the documents on which they propose to rely. Other documents in their possession that are relevant to the dispute will also need to be identified.

Schedule 8 further provides that, before a conciliation conference is held, each party must produce to the other party the documents on which it proposes to rely. If the material is not produced, it might not be able to be relied upon in conciliation or in subsequent court proceedings. These amendments will increase the number of disputes resolved at conciliation if parties demonstrate the necessary commitment. They will also reduce delay costs and inconvenience. To support the withholding of information from conciliation is to promote the proposition that matters must be resolved at the Compensation Court after a very lengthy delay, rather than quickly through conciliation.

If evidence available to the other side is so compelling, it should be introduced as soon as possible so as to resolve the dispute at the earliest opportunity—in effect, to nip it in the bud. Claims for privilege in relation to documents which the parties do not want to rely upon can be considered if a conciliator or court wishes to order production. Schedule 7 to the bill deals with medical reports. The intent of this proposal is to reduce the number of unnecessary reports obtained in disputed claims. I understand that the final regulation is subject to consultation. The proposal is not intended to limit the treatment provided to an injured worker, and this will be given close attention when the regulation is being drafted.

It is also recognised that, in some cases, there may be a need to obtain updated reports—for example, if the condition deteriorates or there is significant delay between conciliation and court proceedings. These matters will be considered during development of regulations. Schedule 9 to the bill aims to reduce unnecessary legal costs in claims involving multiple managed fund insurers. Insurers under the current scheme are licensed to manage statutory funds, and together they can be regarded as parts of the overall WorkCover scheme fund. Separate representation for each insurer is inappropriate when the claim arises from a single worker, and the bill therefore provides for insurers to be represented by one of them.

In a recent dispute dealt with by the Court of Appeal, 10 insurers were represented by 17 lawyers. The amount in dispute was less than $20,000. An appeal Judge hearing the matter described it as "a disgraceful statement of affairs". Clearly, there is a need for more substantial reform in particular areas. This initial bill represents the first step to a more sustainable but fair workers compensation system.

Mr TRIPODI (Fairfield) [3.28 p.m.]: It gives me great pleasure to comment on the Workers Compensation Legislation Amendment Bill. This is the first in a series of legislative packages designed to bring about lasting and sustained reform to the New South Wales workers compensation system. One of the key areas dealt with by this bill is the proposed injury management pilot. Rather than cutting benefits or reducing entitlements for injured workers, this bill and the proposed pilot will assist to identify best practice injury management arrangements.

The success of this pilot will ensure that workers get prompt and appropriate treatment and get back to work early. Injury management obligations on employers and insurers were introduced with the Workplace Injury Management and Workers Compensation Act 1998. That legislation included improved notification requirements, obligations to develop injury management plans and programs, and improved claim management procedures. Importantly, the 1998 Act sought to assist in getting workers back to work in a timely fashion by providing for payments to be made on claims before a formal decision on liability had been made.

Those provisions were intended to give a head start in supplying medical treatment and injury management. However, poor return-to-work rates following injury continue to be a problem for the scheme. It is now clear that more must be done to build on the early gains from previous reforms to the scheme. The proposed pilot will help to assist with changing the behaviour of all parties in the scheme: workers, employers, medical and rehabilitation practitioners, and insurers. The pilot should assist in demonstrating the value of focusing on recovery and return to work. The objective of the pilots is to seek to identify best practice approaches to injury management. The bill allows the authority to appoint successful tenderers for the pilot projects as injury managers for employers participating in the pilot.

The injury manager appointed under those pilots will be authorised to act in place of the insurer for certain injury and claim management decisions. These could include the claims management functions currently performed by the insurer, such as making an early decision on liability or developing an injury management plan for an injured worker. They may also include authorising payments for health care services and, possibly, weekly benefits so that injured workers get their compensation in a timely manner. This focus enables workers and employers to work together to achieve a timely return to work. Both employers and workers benefit from those arrangements. Workers obtain the services and support they need to recover and return to work, and employers are not burdened by staff absences and other costs associated with workplace injury.

Removing the blockages in the system to facilitate better return to work outcomes is an important area that needs further work. The bill and the pilots will assist significantly in that process. Two pilots are to be carried out. One will be regionally based and located in the Central West, and the other will be focused on the private hospitals and nursing homes industry. The Government is continuing to consult with the insurance industry on a range of matters, including its role in injury management. Clearly, the insurers have obligations beyond the writing of insurance policies, and the positive and appropriate injury management actions of insurers will be essential to the long-term success of injury management in returning workers to work.

Incentives and reports are provided for achieving well on scheme objectives, and penalties are provided for when failure leads to the undermining of scheme outcomes. The bill contains penalties for insurers who simply do not behave the way the scheme requires them to behave if the scheme is to provide properly for injured workers. A new remuneration package is currently being developed in consultation with the insurance industry. This will focus on providing the right incentives for insurers to have the necessary level of injury management capacity in place to achieve scheme objectives. If all parties work together, focusing on the worker's recovery and timely return to work, the scheme and all its participants will benefit.

Mr YEADON (Granville—Minister for Information Technology, Minister for Energy, Minister for Forestry, and Minister for Western Sydney) [3.32 p.m.], in reply: I thank all honourable members for their contributions to this debate. This bill is the first in a series of legislative packages that will be presented by the Government over the next 12 months. The Government is committed to making necessary reforms to bring about sustained and lasting improvements to the scheme. The honourable member for Gosford questioned whether the direction taken by the reforms in schedule 1 is appropriate. The Advisory Council was established in 1998 following the Grellman inquiry into the New South Wales workers compensation scheme.

In its early months the council endorsed the recommendations of the Grellman inquiry relating to the establishment of the Advisory Council and injury managers, which resulted in the 1998 Act. Since that time, the Advisory Council has sought to identify initiatives to improve the scheme. The Grellman reforms have resulted in a slowing in the growth of the deficit. However, those reform initiatives have, in effect, stalled. Further reform is necessary. Accordingly, in 1999 the Advisory Council recommended that the commencement of private underwriting be deferred while further reforms were developed. Despite that, there has been a failure to reach agreement on fundamental scheme reforms in relation to matters such as dispute resolution

The Minister in the other place recently announced a detailed statement of strategic direction for the scheme. That has identified the priority areas for reform. The Government will deliver reforms to meet all the objectives. They include improved resolution dispute arrangements, improved injury management performance, strategies to improve compliance, and strategies for managing the deficit. Since the statement was made in June substantial progress has been made on implementing the strategic direction of the scheme. The WorkCover Authority is at an advanced stage in the tendering process for the injury management pilots.
The bill includes a number of important changes to improve compliance by employers and employees with obligations under the scheme. The bill also rewards responsible employers through the premium discount scheme and makes changes to dispute resolution arrangements. The changes in schedule 1 will ensure that the reform program is able to continue in an effective and timely fashion. Schedule 1 also reconfirms the Government's commitment to consulting with all interest groups in the further development of reforms. The bill also puts in place arrangements to ensure that the Government is able to show the leadership sought by stakeholders in bringing about sustained reforms to the scheme. The bill acknowledges that there is a need for clearer lines of accountability, particularly for scheme performance. It also seeks to facilitate further reform by reducing the existing overlap in functions between existing bodies.

I draw particular attention to one amendment. Schedule 22 transfers a number of transitional provisions from the regulations. I specifically draw attention to item [4] of schedule 22. A recent decision of the Compensation Court cast doubt on the validity of an existing transitional regulation. The amendments in item [4] of schedule 22 re-establish the intent of the transitional arrangements by providing that claimants have an additional period of 12 months from the date of commencement of the Act to make a claim in respect of an injury that occurred before the 1998 amendments to the Act. The bill includes amendments that clarify hearing loss and disease claims. The operation of existing provisions require loss due to previous factors to be properly deducted from lump sum entitlements. Under those amendments if any part of the loss that is to be deducted is difficult to quantify, that part would be deemed by existing provisions to be 10 per cent. That will assist in avoiding unnecessary litigation and cost in seeking to determine precise percentages.

The Opposition has foreshadowed that it may move a series of amendments. Those amendments have been circulated. I will comment on each amendment and state the Government's position. In response to the Opposition's proposed amendment No. 1, the bill provides a reasonable role for the Labor Council in providing a panel of nominees for appointment to the proposed new council. The Opposition amendment would remove that role, and that is an anti-union measure and will be opposed. The proposed amendment is inappropriate as the Labor Council is the peak work and representative body in New South Wales. The Government opposes the amendment.

The Opposition's proposed amendments Nos 2 and 3 are opposed. The amendments would replace the regulation-making power in the bill regarding review of premium discount decisions with a specific provision in the Act. That is inappropriate. For example, the amendments would allow insurers to dispute discounts agreed for employers or employees and to dispute administrative procedures established for the smooth operation of the discount scheme. The Administrative Decisions Tribunal examining a one-off case would not be in a position to consider the broader implications for the whole of the WorkCover scheme.

The Opposition's proposed amendment No. 4 seeks to require the Standing Committee on Law and Justice to evaluate injury management pilots at their conclusion. That is an unnecessary amendment. The bill already provides for a review of the valuation of the pilots by the committee. Therefore the amendment is opposed. The Opposition's proposed amendments Nos 5 and 6 seek to transfer responsibility for appointing an injury manager to the Advisory Council. The appointment of an injury manager is clearly an administrative matter and is more properly dealt with by WorkCover. Therefore, the amendments are opposed.

Opposition amendment No. 7 seeks to exclude past and present union members from being the injury manager for the purposes of the pilot. This is another anti-union measure. Clearly it is not appropriate to include in legislation a provision that requires, in effect, discrimination against union members. Therefore the amendment will be opposed. Proposed Opposition amendment No. 8 specifies that employers may apply to WorkCover and to the Administrative Decisions Tribunal (ADT) for exclusion from the injury management pilot. It is unreasonable to expect the ADT to adjudicate on matters of this nature. Therefore the amendment will be opposed.

Proposed Opposition amendment No. 9 allows employers to apply to the ADT to challenge the appointment of an injury manager. I remind the House that the objective of these pilots is to trial administratively best practice injury management. This amendment is a further move by the Opposition to seek to add bureaucratic and litigious processes to what is intended to be a simple administrative system for trialling better injury management. Under the amendment a particular employer could apply for the removal of an injury manager and, if successful, that manager would be removed for all employers, even those supportive of the injury manager's involvement. Clearly this is not a sensible provision. Therefore the amendment will be opposed.

In relation to Opposition amendments Nos 11 and 12, the functions of the new council clearly indicate that it is to have a role in advising on legislation. The proposed amendments will effectively require a stakeholder body to concur with the making of legislation. It is up to Parliament to decide whether legislation should be enacted in a specific instance, not some external stakeholder body. Therefore the amendments will be opposed. Opposition amendment No. 13 seeks to allow parties to object to the production of documents in conciliation. Effectively, that will undermine the purposes of the amendments in schedule 8. Exchange of information will assist significantly with the settlement of matters.

To support the withholding of information from conciliation is to promote the proposition that matters must be resolved at the Compensation Court after a lengthy delay rather than quickly through conciliation. Matters will not settle and workers will encounter delays in receiving compensation. If material is to be relied upon in court, it should be produced in conciliation. The proposed amendment effectively will result in the conciliator's time being taken up in considering objections. Appeals from those decisions will result in unnecessary legal costs. Therefore the amendment will be opposed.

Opposition amendments Nos 14 and 15 seek to provide that small to medium size enterprises cannot be charged twice the avoided premium plus interest when they have provided false or misleading information. Instead they will be liable only to pay the avoided premium plus a flat rate of 10 per cent interest. The existing provisions of the Act relating to double premiums are already limited in their operation to those that provide false or misleading information. Current provisions are not applied to honest mistakes. These cases are already dealt with under sections 171 (1) and 171 (2) of the 1998 Act or sections 175 (1) and 175 (2) of the 1987 Act. In fact, the amendments could create an anomaly in that they will place employers that provide false or misleading information to the insurer in circumstances where they ought to have known that it was misleading in a better position than those employers that genuinely make an honest mistake. Therefore the amendment will be opposed.

Opposition amendment No. 16 is not necessary as prosecutions can still proceed under the Crimes Act 1900. Contrary to what has been said, this bill has substantial provisions to deal with fraudulent claims. A new expanded provision has been included. The new offence does not stop prosecutions being taken under the Crimes Act 1900. Therefore, the Government will oppose the amendment. Opposition amendments Nos 17 and 18 seek to create a right of appeal to the ADT for insurers aggrieved by a decision to impose a civil penalty. These amendments are not considered necessary. The board, in making the decision, would be required to observe the principles of administrative law, including the requirement to afford the insurer natural justice.

The bill specifically requires the board to provide the insurer with an opportunity to make representations. Insurers are well resourced and are more than able to protect their rights without the need for a review before the ADT. Therefore the amendment will be opposed. I believe I have addressed all of the amendments proposed by the Opposition. It is not surprising that the overwhelming majority of those amendments are simply anti-union. As usual the Opposition is predictable in being blatantly anti-union, whereas this Government takes a balanced approach to all matters, including industrial relations. I commend the bill to the House.

Question—That this bill be now read a second time—put.

Division called for and, pursuant to resolution, deferred.

SPECIAL ADJOURNMENT

Motion by Mr Whelan agreed to:

CRIMES (ADMINISTRATION OF SENTENCES) AMENDMENT BILL

Second Reading

Debate resumed from 14 November.

Mr HUMPHERSON (Davidson) [3.47 p.m.]: I am pleased to speak on behalf of the Opposition to the Crimes (Administration of Sentences) Amendment Bill. This bill clearly demonstrates what the Opposition has asserted for some time: the Government led by Premier Carr is soft on crime and criminals. During the past five years a series of bills has been progressively introduced, primarily by the Attorney General, which wound back all that was done by Michael Yabsley, the responsible Minister in the Greiner and Fahey governments, to achieve firm and fair sentencing. The Opposition remains resolute in relation to sentencing.

Truth in sentencing should be inviolate; it should not watered down. The sentencing of criminals in this State should be carried out in a firm, clear and transparent manner. When a sentence is handed down by a court it should not be altered, varied or watered down by another body such as the Parole Board. No body should be able to interfere with the sentence but the original sentencing court. The Opposition has adhered to that principle for more than a decade. The Attorney General is hell-bent on winding it back. The Opposition will not bend; we will remain firm. We will not give any ground on the key aspects of this bill which seek to wind back the sentencing procedure in this State. The truth in sentencing policy is a reflection of community expectations.

In legislation introduced last year the Minister sought to redefine minimum sentences and remove what was clearly prescribed in 1989 as a minimum sentencing regime. When a court handed down a sentence the minimum sentence was made clear to the community and could not be varied in any way. At the expiry of the minimum sentence, a prisoner would be eligible for parole through a number of mechanisms. Until that point was reached, the original sentence was clear and unequivocal. I remind honourable members that before truth in sentencing became a reality in this State, the sentencing system involved remissions, which operated on the whim of the Minister or individuals who sought to release prisoners far earlier than they should have been allowed out of gaol. The actions of the former Minister for Corrective Services Rex Jackson, a Labor member, reflected the corruption of process which occurred under the Wran administration.

We now have a transparent and firm sentencing process, and the Opposition will not accept any winding back of that process. The community of New South Wales has stated clearly that it expects firm sentencing. The community expects sentences to reflect the nature of the crimes and the expectations of victims and their families. Sentences are expected to act as a clear deterrent to others, and to be firmly and consistently applied. Once applied, there is to be no walking away from the sentence or attempt to dilute it. The expectations of the community are respected, above all, by the Liberal and National parties in this place. The achievements of Nick Greiner and Michael Yabsley were substantial, and we will not walk away from them. For some months the Coalition has been trying to debate a bill relating to Allan Baker. The Government will not debate the bill. Allan Baker was sentenced to life imprisonment—and life means life.

Mr Yeadon: Point of order: The bill currently before the House is the Crimes (Administration of Sentences) Amendment Bill. The honourable member for Davidson seems to be referring to another bill that has been brought into this House by the Leader of the Opposition. He should be reminded that the debate is not about that private member's bill. The honourable member should debate the bill that is currently before the House.

Mr SPEAKER: Order! The honourable member for Davidson will have an opportunity to speak to the other bill when the second reading debate takes place.

Mr HUMPHERSON: Mr Speaker, bearing in mind that you are closely following the debate, you would realise the point I was making. Any member who is listening would realise the point I am making.

Mr SPEAKER: Order! The Chair has ruled on the matter. The Chair was listening to what the honourable member for Davidson said, and a point of order was taken about his reference to a bill that is yet to be debated. He will have an opportunity to address that bill when the second reading debate takes places.

Mr HUMPHERSON: The example I gave was not in relation to the bill per se but in relation to a criminal who was sentenced to life imprisonment. He has made an application to have his sentence redetermined and he will be released unless the original sentence is confirmed. That is opposed by the Government. The Government is hell-bent on watering down sentences. In our view, there are three primary forms of sentencing available to courts in this State: full-time imprisonment, which has various categories; home detention; and periodic detention.

Mr Collier: Point of order: The honourable member for Davidson is misleading the House. There are other forms of sentencing. Perhaps he should read the bill.

Mr SPEAKER: Order! No point of order is involved. The honourable member for Miranda may raise that matter in debate.

Mr HUMPHERSON: The honourable member for Miranda has clearly not been a member long enough to understand the forms of the House or the purpose of debate. For his benefit, I will repeat that there are three primary forms of sentencing in this State which involve some form of detention. They are full-time detention in gaol; periodic detention, which I hope is understood by the honourable member; and home detention, which has been introduced more recently.

Mr Collier: What about community service?

Mr HUMPHERSON: If the honourable member for Miranda listened to what I said he would understand that there is a distinct difference between community service orders and home detention, as I have just outlined. He should keep his inane comments for his speech. When a court hands down one of those three forms of sentencing, it should not be open to the Parole Board, with its notoriously soft approach, or any other body or individual to second-guess or redefine the original sentence. That was our primary concern in relation to the original bill that was introduced last year. We still have that concern. If a judge orders that the non-parole period is to be served in full-time detention, that order should be respected. Likewise, if a prisoner is sentenced to periodic detention, that should be respected. If a prisoner is sentenced to home detention, that should also be respected. Because of the people the Government appoints to the Parole Board, the board is a creature of the Government We have serious concerns about the role of the Parole Board and the powers being given to it by the Carr Government.

The bill takes another step to water down sentencing in this State. The bill proposes a range of changes. A number of them are procedural and do not cause the Opposition any great concern. Some of the changes are inadequate. I will refer to some of the key amendments in the bill. First, the bill expands the definition of "law enforcement agency" to include the Police Service or the police force from another State or Territory, the National Crime Authority, the Director of Public Prosecutions and the Department of Juvenile Justice. The Opposition is not concerned about that provision. The bill clarifies that an inmate performing work inside a correctional centre is not performing community service work. That provision is an appropriate clarification and, similarly, we do not have any concern about that.

The bill expands the definition of "correctional officer" to include full-time officers employed by the department as well as those employed in the privately managed Junee Correctional Centre. That seems to be an appropriate mechanism, particularly given that Junee Correctional Centre has been in operation for some years. Clearly, a significant proportion of the State's prison population is housed at Junee. I note that the Junee Correctional Centre remains the only privately operated correctional centre in New South Wales. The Government intends that the three new gaols to be developed in the coming year or two are to be operated by government. I draw to the Government's attention the fact that substantial savings would be achieved if one or more of those centres were operated as privately managed centres. I invite the Minister to respond to that in his reply.

The Auditor-General's report on Wednesday indicated that something like $140 million could be saved in the next decade if the Minister adopted a more liberal approach to private-public partnerships in the operation of prisons. A further change to the Act will allow police and correctional officers to arrest an inmate who breaches conditions on a local leave permit. Another change will increase from $50 to $100 the amount payable as compensation for damage to property caused as a result of committing a correctional centre offence. This is one of the key points with which the Opposition has a problem. I draw the attention of honourable members to the riot that occurred in Goulburn gaol earlier this year.

The extent and nature of the riot was not publicised. The Government sought to control, and has continued to control, the amount of information released about the riot. Our understanding is that about $500,000 worth of damage was sustained to taxpayers' property by 40 inmates in Goulburn gaol who rioted. An entire wing was trashed. Some 24 cells containing the 40 inmates were extensively damaged. The building had to be closed down. We do not know at what stage the wing was able to be reopened, but all the prisoners within the wing had to be relocated. The damage consisted of pulling plumbing off walls, destroying masonry, attempting to burn linen and bedding, and attempting to remove bars from the various doors of the cells.

Officers in riot gear stood outside the wing while inmates were allowed to continue to riot and trash their cells. The damage bill amounted to $500,0000. Even the Commissioner for Corrective Services conceded that there had been a "minor disturbance". The Minister has refused to disclose precisely the cost of the damage. The Minister has conceded through the commissioner that in excess of $150,000 damage was sustained. We do not have confirmation as to whether all the repairs have been completed. If inmates are going to cause damage that costs the taxpayers of the State $500,000 there should be greater recompense than the $50 that currently applies, or the $100 to which the Government proposes to increase it.

The proposed compensation is woefully inadequate compared to the extent of the damage. The Opposition believes that if inmates deliberately damage taxpayers' property in a correctional centre the penalty should be 10 times what the Government is proposing. Compensation of $1,000 should be levied on all the inmates involved in causing damage, and it should be debited from their allowances. At this time there is no disincentive whatsoever to inmates who decide to trash their cells. In the Goulburn riot a substantial amount of damage was sustained. The Opposition intends to move an amendment to the penalty proposed in the bill.

The bill provides that an inmate must be given medical treatment as is necessary for the preservation of the inmate's health. Only the Chief Executive Officer of the Corrections Health Centre may order compulsory medical treatment. The Opposition has a problem with that provision. The bill extends the definition of "court" so that any court may require an inmate to attend before it for legal proceedings. The bill will amend the Act to provide that time served on another matter while out on periodic detention cannot be counted towards the completion of the periodic detention.

The bill gives the Parole Board rather than the Local Court the power to hear appeals against a decision not to grant leave of absence during detention periods, and enables the Parole Board to revoke an offender's periodic detention order on health or compassionate grounds. The bill also enables the Parole Board to replace a periodic detention order with a home detention order if the remaining sentence is 18 months or less. It also provides that the Parole Board may revoke a home detention order and may reinstate it if the offender has served at least three months of the sentence by way of full-time detention.

The bill increases the number of members of the Serious Offenders Review Council to at least eight and not more than 14. It provides that a non-member of the council may represent a review councillor at meetings of the Parole Board. The bill makes a number of minor amendments to the administration of community service orders. They are primarily the most significant changes within the bill. The Opposition has significant problems with a couple of areas. One is the penalty for offenders who damage property and the other relates to the powers of the Parole Board that facilitate an easy transfer of inmates between periodic detention and home detention.

This is one of a number of steps that have been overseen by the Minister for Corrective Services, and the Attorney General to facilitate the ability of inmates to move from periodic detention to home detention. The next step is to move from full-time detention into periodic detention and/or home detention. Back in August the Minister flagged his early release plan, and it is clear that this is part of it. His Home Free policy, which will allow inmates in the latter stages of their full-time sentences to access home detention, substantially waters down the principles of truth in sentencing. One can understand the motivation for wanting to rely more significantly on home detention. There are some good arguments for home detention and there are some very good arguments against it.

If the original sentence is determined as home detention then it is appropriate. If the judge sentences an inmate to full-time detention that should be respected. The same goes for periodic detention. The Minister said, "The move will be good for both the prisoners and society" and, "This will assist their rehabilitation and raise the possibility that they will not reoffend once they have finished their final sentence." Both of those quotes relate to the plan for early release under Home Free. Under the plan offenders sentenced to more than five years imprisonment who have less than 18 months to serve could serve the remainder of their sentence by way of home detention. Such a move would be inappropriate for the reasons I have outlined.

The Minister sought to introduce Home Free to save a substantial amount of money. There is no doubt that it is cheaper in the longer term to supervise inmates on home detention than house them in either full-time or periodic detention. Depending on the nature of the supervision, home detention can cost as little as $18,000 per year compared with full-time detention which is of the order of $50,000 per year for both minimum security and periodic detention. There are savings to be made. Obviously, the present system in New South Wales is under stress. There is no surplus capacity in any of the gaols in this State, hence the desire to build three new gaols to house inmates.

Moving to home detention clearly has its economic attractiveness. But the principle we hold is that if an offender is sentenced to something other than home detention it is not appropriate that home detention apply to that offender. If someone is sentenced to home detention, that is fine; but the nature of a sentence cannot be changed simply because it is fiscally attractive to the Attorney General or the Minister for Corrective Services. The bill gives the parole board substantial powers to revoke periodic detention, allow people to move into home detention in the 18 months to the end of their sentence, and release the prisoner indefinitely whilst home detention is considered for him or her.

We will not move away from the principle that there is a place for periodic detention and a place for home detention but there is not an appropriate mechanism by which people move from one to the other unless it is part of the original sentence. The Minister's Home Free policy was released on 5 August and he has not repudiated it. It would facilitate the movement of prisoners between full-time detention, periodic detention and home detention—and, effectively, out of gaol. If that is the case, the penalties do not match the crime or the original sentence.

Members wanting to understand the pros and cons of home detention should read a report released in February last year. Another report on the success and effectiveness of home detention in the past 12 months should have been released by now. The Minister is clearly sitting on the report. He is obliged under the original Act to release a report to Parliament on the effectiveness of home detention but he has not yet done that. Judged against the aims of the February 1999 report, home detention has been a flop. The report tried to make out that home detention is a great success but there are many inadequacies. The fact that the follow-up report has not been released shows that they have not been redressed. It is not appropriate to rely on home detention. There is no indication whatsoever that home detention is effective in reducing recidivism. In fact, there is evidence to suggest that people on home detention continue to commit crimes in the same way they would have if they had not been convicted and had remained at large.

Members on the other side have not bothered to read the report. They would do well to put pressure on the Minister to disclose the contents of the as yet unreleased report so that we can understand the inadequacies of home detention. In crude terms, half the people who have gone through home detention commit some form of breach. They test positive to drugs and alcohol, they are not at home when they are supposed to be at home or they commit another offence—armed robbery, break and enters, stealing, fraud. They would find it very awkward to commit such offences if they were in full-time detention in prison. Until we address the faults in home detention it is inappropriate to rely on it as an appropriate form of penalty for all types of crime.

Home detention puts pressure on other members of the family. Having a criminal staying in the home has advantages but it places a great deal of pressure on other family members in that home. Regular phone calls to check on the whereabouts of the offender at all times of the day and night interrupt family life and are an imposition on other family members. Spouses and children are woken. There is far greater access to alcohol and drugs to people on home detention. The Government would concede that drugs and alcohol are available—they may not be readily available—in prison, but drugs and alcohol are available in most home environments. This is a temptation to someone with a problem with drugs and alcohol. Statistics demonstrate that 60 per cent of people convicted of drug- or alcohol-related offences test positive to drugs or alcohol while on home detention. It is questionable whether home detention is appropriate for people convicted of those offences.

Pursuant to sessional orders business interrupted.

PRIVATE MEMBERS' STATEMENTS
_______________

GRAFFITI CLEAN-UP CAMPAIGN

Mr DEBNAM (Vaucluse) [4.15 p.m.]: Sunday 26 November will be the fourth annual graffiti clean-up in my electorate. The clean-ups are held on the last Sunday in November. The community and local businesses will clean up as many locations affected by graffiti as possible. The clean-ups serve a number of purposes. They raise community awareness of graffiti. I make two points to the community and to business. The first is that the most successful strategy in dealing with graffiti worldwide is to remove it as soon as it appears. Where that strategy is in place further graffiti attacks are suppressed. Secondly, it is relatively easy to remove graffiti. Unfortunately, community members and businesses feel helpless to battle graffiti but solvents available from hardware stores can remove it or, depending on the surface, the area can be repainted.

It is particularly difficult to catch offenders applying tags to buildings and structures. There is a feeling in the community that offenders are dealt with two leniently by the justice system. I am not sure that that is always the case but in some cases it seems that members of the judiciary feel that they are dealing with only teenagers. However, the people doing the most damage with graffiti are young vandals in their twenties who know that even if they are caught they can get off leniently. The Parliament should address this issue and reconsider the penalties, which are not working, and ask the judiciary to do its job in providing an effective deterrent.

It is apparent that a number of people in the community are getting the message that graffiti should be cleaned up quickly and that the right solvents are available. But that is not happening with the public authorities. Public sector buildings, structures and properties are becoming hot spots for graffiti. They become ugly monuments covered with graffiti tags. This week I put a suggestion to the Premier that the Parliament should show leadership in this regard and require departments, agencies and businesses to attack the problem in the same way we are suggesting to the community. I have asked the Premier—this is one of the best ways—to establish a free call hotline so that members of the public can report graffiti applied to public property, with government departments committing to removing it within seven days of its being reported.

Once government departments understand the process they will react immediately, like the rest of the community, and not take seven days. I ask the Premier to consider that suggestion in the next few weeks and establish a free call hotline. This would allow the public to report incidents of graffiti and for the public sector to give a commitment to clean it up. The hotline should not only be established; it should be promoted and made available to the public. It will encourage community pride in the local neighbourhood and ensure that the public sector does the right thing and takes pride in building structures and properties for which they are responsible.

WERRINGTON ARTERIAL ROAD

Ms BEAMER (Mulgoa) [4.20 p.m.]: I refer to a significant project that I would like constructed in the Penrith area: the Werrington arterial road. This section of the Werrington arterial road would comprise a link through Gipps Street, Werrington Road, Christie Street and Forrester Road. It is singularly the most important section of road infrastructure in Penrith. The road has been identified in the State government planning strategy for western Sydney entitled "Shaping Western Sydney". However, it has not been included in the Government's five- to 10-year plan Action for Transport 2010. The Roads and Traffic Authority is at present finalising the concept design for the route. In the longer term this road will be a link between the M2 extension and the M4. In the short term it will provide a link for existing and new residential and industrial development, as well as existing requirements emanating from the University of Western Sydney and TAFE.

There will a 50 per cent increase in residential development over the next 10 years, including the already approved Claremont Meadows extension, Caddens release area, North Penrith army land, the proposed ADI site and signals land. These extensive developments will all need to use the link road. Major industrial developments include the recently completed facilities of ACI, Smorgons and the proposed FreightCorp transport terminal. These developments will significantly increase traffic around this area. The FreightCorp development will generate substantial traffic volumes, a majority of which will be heavy vehicle transport. Further developments also include the education precinct incorporating the University of Western Sydney, Penrith and Werrington TAFE. Failure to complete a link road will overload Mamre Road, Forrester Road, Roper Road and Glossop Street. These roads, in particular, Mamre Road, are already at capacity. Constituents who see me at my office almost invariably refer to Mamre Road as having the most problems.

The honourable member for Londonderry will attest that Glossop Street, Roper Road and Forrester Road—it being in his electorate—cause problems. Long delays are experienced at the intersection of Mamre Road and the M4. As a result, people have tried to avoid the area by travelling through nearby residential areas. Similar problems exist at the intersection of Roper Road and the M4, resulting from major development increase in Minchinbury. The Mamre Road-Queen Street intersection is at capacity and cannot deal with further traffic volumes. Nothing can be done to fix that intersection. Overcapacity on these routes will exacerbate the already unsatisfactory through traffic in residential areas. Building the road will provide the impetus for further investment and job growth that is badly needed because considerable housing development without job growth will create further social problems. Penrith City Council has approached the Minister and I support the council in its claims that the Action for Transport 2010 plan should incorporate this road because it is the most singularly important road infrastructure plan for Penrith.

YOUNG AUSTRALIAN OF THE YEAR AWARDS

Ms HODGKINSON (Burrinjuck) [4.25 p.m.]: Last night I had the honour of attending the New South Wales awards presentation night of the Young Australian of the Year Awards for 2001 at the invitation of one of my constituents from Yass, Mrs Kathleen Allan, who was a finalist in the Federal Government's Regional Initiative Award. Highlights of the program included Ron Wilson, as Master of Ceremonies, the national anthem and additional entertainment provided by Tim Draxl, who was a nominee in the Collins Booksellers Arts Award—and a very talented performer he is, at the age of 19 years. Carrie Elton from the National Australia Day Council welcomed guests. Some of the judges who played a vital role in last night's awards included: John Glover, President, Agricultural Societies Council of New South Wales, a tireless worker for all things agricultural, rural and regional; Kenneth Graham, Head of Sports Science, New South Wales Institute of Sport; and Bob Ridding, Director, REID Management.

I shall outline some of the category winners of New South Wales finalists. Scott McDonald, aged 25, won the Mayne Nickless Community Service Award. Scott is a surf lifesaver and a fundraiser. He has been involved with the Fire Brigades and comes from Laurieton on the North Coast. Alex Hartman won the Commonwealth Minister for Youth Affairs Career Achievement Award. At the age of 20, Alex employs 65 people and has offices in Sydney, San Francisco and London, with others opening soon in New York and Hong Kong. The Abigroup Sports Award was won by Lauren Jackson, aged 19, from Albury. She is an Australian Opal. The TXU Science and Technology Award was won by Dr Josephine Trott, who is currently researching breast cancer at the National Institute of Health in the United States of America. The Unilever Environmental Award was won by Kirsten Benkendorff, aged 26, who is working on marine bioprospecting at the University of Wollongong.

The Collins Booksellers Arts Award was won by Jane Miskovic, who is a choreographer. She choreographed 2,000 dancers at the opening and closing ceremonies of the Olympic Games. The Federal Government's Regional Initiative Award was awarded to my constituent, Kathleen Allan. Kathleen has a diversity of agricultural interests, not least of which being the "patting paddock" that she runs with her mum, Jane Southwell, which goes around to the various agricultural shows. She also takes these small animals to nursing homes in Canberra and district. This provides wonderful entertainment, particularly for those who used to live on farms and now live in nursing homes and do not get to see the animals that used to be such a large part of their lives.

I am so impressed with Kathleen's commitment, drive and energy. This girl is really going to go places. I am proud to be her local member, I was proud to be seated at her table last night and I am so proud that she has won this award. Her husband, David, her mum, Jane Southwell, her brothers and sisters, and her friend, Pamela Sayers, were there last night. We expressed our pride in Kathleen in no uncertain terms. I would also like to mention Sharon Donges, who put in a very highly commendable performance in the regional initiative award. Sharon is 22, and she is a young person with a passion for tourism. She is integrally involved with JD's Jam Factory at Young. I have known Sharon for a few years and she is really second to none. I hope that she will try again next year.

The young achiever of the year for New South Wales was Jane Miskovic, the choreographer. Coming up next are the national awards and Kathleen will be a part of that. I take this opportunity to wish her luck in the forthcoming Australia-wide awards. The national winner of the Young Australian of the Year Awards for 2001 will be announced by the Prime Minister on Australia Day. I know that the talent across this country is absolutely exceptional, just going on the performances of those in attendance last night. All of those young people came from a broad diversity of employment careers and they will be going places. [Time expired.]

AUBURN ELECTORATE YOUNG OLYMPIC TORCH BEARERS

Mr NAGLE (Auburn) [4.30 p.m.]: The Olympic Games and Paralympic Games are over and we have moved on from those events, but I want to bring to the attention of the House the names of two young children who had the opportunity to run with the torch towards the Olympic Stadium on that famous night of 15 September. While everyone was preparing for the Olympic Games the students, teachers and principal of the Lidcombe Public School got into the festive spirit with its Olympic carnivale celebrations.

I was fortunate enough, together with Phil Gilbert from Mitsubishi Toyota at Lidcombe and others, to attend the celebrations, where children from kindergarten to year 6 performed separate items, ranging from dance to song. A huge number of parents were present to witness the Olympic flavour of those performances and it was a very delightful morning. Two primary school children—Paolo Conanan from St John's school in Auburn, and Tom Robson, a year 6 boy from Lidcombe Public School—were selected to carry the Olympic torch after winning an essay competition entitled, "The Day I Carried the Olympic Torch".

There is a photograph of the boys in the Daily Telegraph with students from a couple of other schools in the area, celebrating their success. Tom Robson from Lidcombe Public School ran from Shane Gould Avenue to Dawn Fraser Avenue on the opening night of the Olympics in what was a very thrilling time for him. Paolo was selected as his school's representative after his entry was chosen. For the record I would like to read Paolo's essay entitled "The Day I Carried the Olympic Torch". He wrote:

For that essay he was awarded the right to carry the torch. As I said, Paolo is a student at St John's school. There was a photograph in the local newspaper of Paolo with his parents, his sister Teresa, and his brothers, Joshua and Lorenzo. It was a very proud day for them. It was also a very proud day for Tom Robson and his family when he got to carry the torch. These are beautiful children. When the announcement was made the local newspaper published the following article:

Paolo is a keen basketballer who has excelled in his religious studies; Thomas, a school captain, is an outstanding swimmer and public speaker—

I have heard that young man speak and he is a great public speaker—

Mary Peacock, principal of Lidcombe Primary School, said:

I congratulate both Tom and Paolo. Well done! You have made your country proud, you have made your suburb proud, and you have made your school proud. You are great human beings and I am proud to be your local member. I wish you both all the best in the future. God bless! God speed! Have a great life!

CRONULLA POLICE INVESTIGATION

Mr KERR (Cronulla) [4.35 p.m.]: I echo the sentiments expressed by the honourable member for Auburn. I want to talk tonight about an incident that relates to police resources at Cronulla police station. It commenced on 4 and 5 April 1998 when police attached to Sutherland Local Area Command and surrounding commands arrested and charged approximately 10 males in the vicinity of McDonald's at Menai. Those males were charged with offences including assaulting police, resisting arrest and violent disorder. During the arrest the Police Dog Squad was utilised, as were other police groups, such as the Highway Patrol. Subsequent to that the matter came before the Local Court at the Downing Centre and the charges were dismissed.

Mr Nagle: They obviously had a good lawyer.

Mr KERR: They may have had a good lawyer. I will not enter into that except to say that, having read the transcript, I have serious concerns in relation to that matter. I would be happy to talk to the honourable member for Menai about those concerns. During the early hours of 5 April, one of the alleged offenders made a complaint that he had been assaulted by police and bitten by a police dog. That complaint was referred to the Ombudsman's Office and an internal inquiry commenced. For the purposes of this matter I will refer to that as inquiry mark I. When completed, the results of inquiry mark I were forwarded, through the normal chain, back to the Ombudsman's Office. The inquiry was sent back to Sutherland for re-investigation.

Police then commenced another inquiry into the complaint, mark II, which supported the results of inquiry mark I, and forwarded the matter back to the Ombudsman's Office. Once again, the Ombudsman's Office was unhappy with inquiry mark II and a task force was formed to investigate the complaints. It was headed by senior commissioned officers, as well as two detective sergeants. This inquiry was conducted from Cronulla Detectives Office. This took up much of the personnel and resources of Cronulla police. Inquiry mark II involved the re-interviewing of all police witnesses. A number of complaints were then made to the Ombudsman's Office about the manner in which inquiry mark II had been conducted.

At the time of this inquiry, there was also an ongoing investigation into the murder of a service station attendant. It would be interesting to know whether the experience and expertise of the officers involved in the internal inquiry were utilised in relation to the murder inquiry. In fact, it would be interesting to compare the amount of police resources used in relation to the ongoing murder inquiry with those used in relation to the ongoing police internal inquiry. A number of police officers who were being investigated suffered severe stress and their health was dramatically affected.

Today, 2� years have elapsed since the complaint was made. I have to say, in what is perhaps the understatement of the century, that the manner in which the Police Service investigates itself clearly requires greater expedition. I will be interested to note when the inquiry will be completed. It would be ironic if more complaints were made and inquiry mark X were set up, and so on. There has to be a finalisation of this matter. It was not a complex fraud case but one in which the facts fell within a very short compass. It is time justice was done—as honourable members know, justice delayed is justice denied. I informed the Minister for Police that I would be making this statement and I urge him to obtain a copy of the court papers in relation to this matter and to report on what is happening. The livelihood and health of experienced police officers is being affected.

SPENCER PUBLIC SCHOOL CENTENARY

Ms ANDREWS (Peats) [4.40 p.m.]: On Saturday 4 November I had the great pleasure of attending the centenary celebrations of Spencer Public School. The celebrations were well attended by local residents, former principals and pupils of the school—many of whom had travelled long distances to be in Spencer for this special occasion. The centenary of this one-teacher school was marked with a full day of celebrations. The master of ceremonies was no other than world-renowned town crier and Central Coast resident, Graham Keating, looking resplendent in his full regalia. A special centenary book was produced to commemorate 100 years of public education at Spencer Public School. The official opening of the centenary gardens in the school's grounds was one of the highlights of the day. Those gardens are a very pleasant reminder of the school's centenary.

Central Coast Superintendent of Schools, Mr Bill Low, and the school's principal, Mr Paul Miller, paid tribute to those who had served and supported the school in the past. Both commended all those who had been responsible for the centenary celebrations which continued throughout the day. One person who was given a special mention was the president of the school's parents and citizens association, Mrs Donna Thompson. Donna, together with her fellow association colleagues, did a marvellous job on the day, catering for the huge crowds. They had also worked extremely hard in the months prior to the centenary celebrations.

Students of the school were invited by the school's principal to place various items, including brightly coloured drawings—the personal work of each student—in a time capsule, together with a roll of past students who attended the centenary celebrations. The capsule will not be opened until 2025. A centenary birthday cake was cut by the school's oldest former student in attendance, Mrs Edna Parsons, nee Wallbank, who attended classes at Spencer in 1917, and the youngest student in 2000, Sam Bevan. Spencer Public School is the smallest school on the Central Coast, located in an idyllic setting near the majestic Hawkesbury River. Moves were afoot as far back as January 1894 to have a school established in the area. That application by the residents of Lower Mangrove Creek was unsuccessful, as Inspector of Schools, Charles Pitt, reported on 17 February of the same year that in his opinion the educational requirements of the district were sufficient for the present. In 1900, Fernleigh, as Spencer was then named, had 21 children of school age and eight under school age.

School Inspector Dettmann then recommended that a full-time school be established at Fernleigh, at the mouth of Mangrove Creek, on about two acres of Crown land near Mr James Crosland's property. The school was to accommodate from 30 to 40 children. The first selected site for the school was not considered to be central and District Inspector Lobban was asked to investigate the matter. Lobban noted that the land had belonged to the current owner's father—presumably this was the father of George Byrnes—and that there was some debt on it. Although Byrnes' offer to give the site to the department and its resumption without compensation to the owner was approved by the department on 12 July 1900, the land apparently was not resumed but remained Byrnes' property.

The department then realised that there was already a school named Fernleigh near Ballina. Inspector Lobban was asked to suggest another name for Fernleigh on the Hawkesbury River. The local residents suggested Orange Valley while the inspector submitted Tyrnant, which is Welsh for "by the water", as an alternative. The Inspector of Schools, Frederick Bridges, had the final say in the matter and recommended that the name of the school be altered to Spencer, being the parish in which it is situated. It is interesting to note that the post office was not changed from Fernleigh to Spencer until 1914. That alteration was made necessary because mail for Fernleigh school on the North Coast was repeatedly being mistaken for the Hawkesbury River school.

Construction on the school building began on 2 August and was completed by 6 September 1900. The classroom measured 16 feet 8 inches by 20 feet 9 inches with a hat room measuring 10 feet 8 inches by 7 feet 9 inches. The building by George Byrnes was completed by 6 September 1900. The school opened on 15 November 1900 with an attendance of 13 and the only furniture consisted of two combination forms and desks in very bad repair, one easel and several pieces of blackboard. The first teacher was a young single man aged 21 years, Mr George Hutchison, BA, who earned an annual salary of �72.

In July 1902, Spencer school became a public school with an average attendance of at least 20. The enrolment over the years has fluctuated from a peak of 46 in 1930 to seven in 1995. Today, there are 10 students attending the school and these students have benefited significantly from the Government's computer roll-out program. There are four computers at the school and one of those is connected to the Internet. [Time expired.]

QUEANBEYAN SCHOOL OF ARTS CAFE CLOSURE

Mr WEBB (Monaro) [4.45 p.m.]: This evening I speak of a sad occasion, the end of the Queanbeyan School of Arts Cafe. The cafe has become a local institution and a role model for cabaret venues. A lot of Australians who perform on the national and international stage got their grounding at that cafe. Queanbeyan has an opportunity to transform itself into a cultural centre close to the Australian Capital Territory, and the community could develop this site as a further cultural centre. The Queanbeyan School of Arts Cafe is a unique, energetic and high-profile entertainment business operating out of a heritage building in the main street, at 108 Monaro Street, Queanbeyan. It is the longest established cabaret venue in Australia and since 1986 has been owned and operated by Pat, Bill and Timothy Stephens.

The building, parts of which date back to 1867, has been tastefully redecorated. Originally it was part of the billiard room and reading room of the first Queanbeyan School of Arts which functioned in the building from 1895 to 1927. Over the years since 1927 the building has been used for a variety of purposes. However, in 1983 it was converted into the School of Arts Cafe, which the Stephens family purchased in 1986. It has become an important entertainment centre. Several nights each week it offers a unique form of professional dinner-theatre-music cabaret. It has showcased not only leading local entertainers but also many of the nation's biggest names in the field of cabaret.

Celebrity artists who have appeared there include June Bronhill, Lorrae Desmond, Geraldine Turner, Jan Adele, Nancye Hayes, Kerrie Biddell, Julian Lee, Jeanne Little, Jennifer Leslie, Jill Perryman, Toni Lamond, Margaret Roadknight, Bernadette Robinson, Judy Glen, Donna Lee, Lana Cantrell, David Campbell, Tim Draxl, Lynn Rogers, Dennis Olsen, John O'May, Derek Metzger, Peter J. Casey, Bruce Barry, Noel Ferrier and many more. Many programs have been recorded and broadcast by Artsound, formerly known as the Canberra Stereo Public Radio. Artsound now broadcasts programs recorded at the cafe, mostly on Sunday afternoons.

The cafe has produced a series of compact discs and a cookbook. It has participated in many other activities in the local and Australian Capital Territory region. The cafe has participated in the National Opera Festival and has attracted a number of awards, including the Southern Tablelands Regional Organisation Award for Tourism Restaurants, the I.M.B. Queanbeyan Business of the Year Award, the Australian Capital Territory Tourism Award, the Southern Tablelands Tourism Award, Capital Country Tourism Award and the McDonald's Queanbeyan Business Award.

For its efforts in providing work experience and employment opportunities for young artists, it was recognised during 1997 with an award from the Australian Capital Territory and Southern Tablelands Area Consultative Committee. People in the television and print media, such as Coralie Wood, have been involved. The cafe has many more functions within the local community and has its own web page. There is concern about the future of the Queanbeyan School of Arts Cafe. The Queanbeyan City Council and the local community must now act to continue the great tradition of the Queanbeyan School of Arts Caf�. The Queanbeyan Age newspaper, another icon in the local community, wrote:

All of the cafe's success over the past 15 years is due to the hard-working Stephens family who have created a venue which has won national acclaim and attracted local national and international stars.

The cafe has put Queanbeyan on the cultural national map. I offer my congratulations to Bill, Pat and Timothy Stephens on their contribution to the social fabric of Queanbeyan and to the arts in the local region, the State and the nation, and on the assistance they have given to all of the artists. I wish them all the best for this icon's closing festivities over the next few weeks. I sincerely hope that assistance from an individual, the Queanbeyan community or the Queanbeyan City Council will be forthcoming to continue this great icon. My best wishes to the Stephens family.

WALLSEND PLAZA TAVERN TRADING HOURS

Mr MILLS (Wallsend) [4.50 p.m.]: On behalf of many constituents in the Wallsend electorate I express disappointment at a Land and Environment Court decision on Monday 20 November upholding an appeal by Copatress Pty Ltd against Newcastle City Council and allowing extended hours of operation of a gaming tavern in Wallsend Plaza shopping centre. The proposed extension in trading hours was from the existing 8.00 a.m. to 10.00 p.m. seven days a week, to closure at 1.00 a.m. Monday to Thursday, 2.00 a.m. Friday and Saturday, and 12 midnight on Sunday. The appeal was upheld, with the applicant receiving the requested hours based on a trial period of 15 months from the date of judgment. The conditions imposed by the court were:

It is understood that the applicants will be required to apply to the Land and Environment Court to modify the condition imposing a trial period at the end of the 15 months. The reason Newcastle City Council rejected the original application was that the proposed extension of trading hours of the premises would have an adverse impact on the amenity of the neighbourhood, particularly:

Another reason given by the council was the potential adverse social impact. Newcastle City Council denied the application because of the noise of intoxicated people trying to enter the premises, arguments and disturbances to the sleep of local residents. I had representations from a number of local residents on the issue. Interestingly, in the Land and Environment Court case the tavern called as a witness a local resident who lives about a mile away whereas the council called as a witness a local resident who lives about 50 metres away. The tavern submitted statements of environmental effect stating that hardly anyone would use the tavern during extended hours. One wonders how it will make a profit and whether the extended hours are worthwhile. The council submitted:

The kind of noises that are generated by hotels, and in particular people affected by alcohol can be of an alarming nature such as loud, angry conversations and calling out.

The potential for neighbourhood disturbance is real. Every blown up letterbox, every bit of damage to property, every smashed fence, every string of shouted obscenities after midnight, every disturbance of the peace and quiet of the neighbourhood will be blamed on the tavern. The Wallsend Town Committee opposed the extension because of the potential for vandalism. I am disappointed that the Land and Environment Court decision ignored the position of the State Government, the State Opposition, Newcastle City Council—our local government—and the affected local residents. The Government made its views known about shopping centre gambling by legislating seven months ago against future gambling licences in shopping centres. At the time of the legislation the Government expressed the significant community view that suburban shopping centres were most inappropriate locations for gambling establishments. Newcastle City Council rejected the application for extension of hours based on local residential community interest, which had expressed significant opposition both to the extension and to the original application some time ago.

This is the second time within a few hours I have spoken in this Parliament about decisions by the Land and Environment Court. The other decision related to the Prince Albert Park case. The court awarded compensation against the State Government when it acquired land held by a trust. Wallsend has two shopping centre liquor-gambling establishments. Most areas in New South Wales will not have these places because the Government has listened to the community view that such places are undesirable. My local community faces the real prospect of the expansion of the existing establishment through a process of incremental enlargement backed by the Land and Environment Court, whose decision seems to ignore both the community and government.

Mr FACE (Charlestown—Minister for Gaming and Racing, and Minister Assisting the Premier on Hunter Development) [4.55 p.m.]: I compliment the honourable member for Wallsend on raising this matter. I do not want to be construed in my reply to be in anyway critical of the decision of the Land and Environment Court. It is not my practice to do so. However, from the point of view of licensing, I will look at the ramifications of the decision on the establishment of facilities in areas where councils are vehemently opposed to such facilities, as the local council was in this case.

There is already enough difficulty with noise and section 104 infringements at premises that were built many years ago. Times have changed dramatically. People in inner-city suburbs complain about noise from hotels that have been established for a long time. Prior to and during the Second World War all hotels closed at 6.00 p.m., other than in exceptional circumstances. I do not want to be seen as pre-empting what I will do, but the honourable member for Wallsend has raised with me possible ramifications of the decision. Therefore, I will ask my Director of Liquor and Gaming and my policy department to look at the decision and the possible effect it may have in other areas of the State.

DRIVERS LICENCE CANCELLATION NOTIFICATION

Mr MAGUIRE (Wagga Wagga) [4.57 p.m.]: I bring before the House a matter that is a comedy of errors between departments that would make a great script for Yes Minister. On 11 August a constituent of the Wagga Wagga electorate received a traffic infringement for exceeding the speed limit on an open country road by more than 45 kilometres per hour. He was informed by the police officer that this offence incurred a loss of six points, a mandatory loss of licence for three months, plus a fine of $1,419. As he needed his driver's licence to perform his job as a Telstra technician servicing public telephones and rural telephone services, he inquired of the Roads and Traffic Authority [RTA] when his licence would be cancelled. He was told if he paid the fine and did not take the matter to court it usually took one to two weeks from the time the police processing department cleared the payment of the fine.

After paying the fine and getting his bank statement saying that his cheque had been cashed, he rang the police processing department. He was told that his cheque had been cleared on 29 August. He was also told by the police processing department that it would inform the RTA, that he would incur the loss of six points against his licence and within two weeks he would receive notice from the RTA informing him that his driver's licence would be cancelled for three months. Knowing that his licence was to be cancelled, he applied to take three months leave from Telstra that was owing to him. It was not easy to organise, because it is a long time to have continuous leave.

After two weeks, and not having received any notice or advice from the RTA, he rang the RTA. He was told that it had not received any advice from the police processing department. He then rang the police processing department and was told that his cheque had been cleared on 29 August and that the delay was caused by the RTA. He rang the RTA to find out what the delay could be. He was told that no advice had been received from the police processing department, that his licence had no demerit points against it and that it was valid until 2004. Every day for more than one week he rang the RTA and the police processing department. The RTA continued to say that no advice had been received from the police processing department, that his licence had no demerit points against it and that it was valid until 2004.

The police processing department continued to say that his cheque had been cleared on 29 August and that the delay was caused by the RTA. As he was not getting anywhere he asked his wife to try. She was told by the Police Department that the licence would be cancelled two weeks after the payment of the fine on 29 August. Assuming that the information was correct and that his licence was cancelled, he continued not to drive for almost three months. On the weekend of 12 November a friend informed him that if he had not received a letter from the RTA his licence would not have been cancelled. He rang the RTA and was told that his licence had no demerit points against it, that it was valid until 2004 and that no advice had been received from the police processing department.

He then rang the processing department and was yet again told that the cheque had been cleared on 29 August and that the delay was caused by the RTA. After a long verbal exchange he was able to contact the supervisor of the police processing department, who, in a couple of minutes, informed him that there had been a mistake in the processing. If he had not raised the matter, he was told, it would have gone unnoticed. He was further told that on 14 November the matter would be forwarded to the RTA and he would lose six demerit points against his licence. In a further two weeks he would receive notice from the RTA informing him that his driver's licence would be cancelled for three months.

When his licence is cancelled he will not be able to carry out his work for Telstra. He has no more annual leave to take because he has already used it up believing that his licence was cancelled, when in fact it was not. It would be very difficult for him to organise further leave with his employer. It is possible that his family will experience great hardship because of the problem within these two government departments. Now that he does not have a driver's licence, which is a requirement for his job, he could lose his job. I bring this matter to the attention of the House. I have the correspondence with me. I lay it on the table for the information of other members. I ask that this matter be remedied retrospectively so that my constituent does not lose his licence and so that he can continue to drive.

Mr FACE (Charlestown—Minister for Gaming and Racing, and Minister Assisting the Premier on Hunter Development) [5.02 p.m.]: The honourable member for Wagga Wagga has described a fairly serious matter. The fellow has a great deal of patience. Indeed, he has the patience of Job to have put up with the confusion for so long. It is a little like pass the parcel. I suggest that the honourable member gives me the information and I will have one of my officers pass it on to the two relevant Ministers. He may care to explore, through the Attorney General, whether the offences can be expunged. I am not sure how that is done, but I understand it is done by the Governor.

KOGARAH ELECTORATE CHRISTMAS CARD COMPETITION

Miss BURTON (Kogarah) [5.04 p.m.]: I wish to inform the House of the special competition I am holding in my electorate. This is the second Christmas since my election as the State representative for Kogarah. As honourable members would be aware, each year we distribute Christmas cards to our electorates wishing our constituents and community representatives seasons greetings. First, I want to thank the honourable member for Mulgoa, as it was her innovative idea that resulted in my running this competition. I was discussing with her the fact that the Christmas cards on offer were fairly standard and that I would have liked something that reflected how the people of Kogarah feel about Christmas. She suggested that I hold a competition throughout the primary schools in my electorate, as she does in her electorate, inviting year 3 students to design my Christmas card, the theme being what Christmas means to them.

Last year was the first time such a competition was held in my electorate, and it was a raging success. I received more than 300 entries. The entries were of such an excellent standard that we found ourselves almost unable to decide on a winner. We finally decided on Anuj Kumar from Carlton Public School. This year we have once again been inundated with entries and, once again, we have laboured over which one is the best. I cannot say who the winner is, because we will announce that next week when finalists and their parents have morning tea with the Premier. Last year the Premier had morning tea with the finalists, and he gained some valuable information about the languages they were learning, the instruments they were playing, and their thoughts on the basic skills test.

I thank the Premier for once again taking time out of his busy schedule to meet and talk with students and parents from my electorate. This year I have chosen eight finalists from the more than 400 entries I received. The finalists are Stephanie Mantzios from St Marys Star of the Sea, Luke Carrubs and Katrina Avila from St Patrick's Primary School Kogarah, Jessica Miglis and Elini Jordan from Blakehurst Public School, Nicholas Hobson from Connells Point, and Laura Haidar and Matthew Peckham from Carlton Public School. The winning student will receive a book voucher for $50 and the student's school will receive a voucher for $200. Last year my Christmas cards were very popular. The people enjoyed receiving something that was original.

I thank the teachers in the schools, who have supported this competition from day one. I also thank the students, who have so enthusiastically participated in the competition. Since my election in March 1999 I have had the honour of being able to develop a close working relationship with my local schools, parents, teachers and students. I look forward to continuing to work with them. Asking such young students to design my Christmas card for me gets them thinking about what Christmas means to them. It also gives them an opportunity to be creative, which all children love to be. The diversity of ideas and beliefs was very interesting. This year, as I did last year, I will visit the primary schools and present certificates to all the students who entered the competition to acknowledge their participation and encourage their creativity. It is also a great opportunity for me to spend time with the students and the teachers. I will continue to hold this competition for year 3 students in my primary schools. I hope it becomes an institution in Kogarah for many years.

Mr FACE (Charlestown—Minister for Gaming and Racing, and Minister Assisting the Premier on Hunter Development) [5.08 p.m.]: I congratulate the honourable member for Kogarah on the innovative way she has involved schoolchildren in a Christmas competition. One of the delightful parts of this job is being able to mix with the schoolchildren and teachers in one's electorate. I enjoy it as much today as I did when I first became a member of this House. Children are the future of this country. Anything we can do to assist them is worthwhile. The Kogarah electorate is particularly culturally diverse. Many of the people involved in the honourable member's competition do not hold Christian beliefs, yet most people of other faiths recognise Christmas. Even though they may not be Christians they celebrate different special occasions in different ways. The competition is a good way for children to learn about other cultures. Once again, I congratulate the honourable member for Kogarah.

SHELLEY BEACH OVERFLOW WORKS

Mr BARR (Manly) [5.10 p.m.]: It is not very often that I get the chance to say something positive about the northside storage tunnel project. I am pleased to say that today I have that chance. The tunnel has delivered one win to the people of Manly. A few hundred metres along Marine Parade from South Steyne beach there is a very pretty small beach called Shelley Beach. It is enjoyed by many people as a beautiful, secluded spot for picnics, diving, swimming, walking and, not least, surfing. Part of Marine Parade is over the MOOS, the Manly overflow ocean sewer. During periods of heavy rain the MOOS, like many other parts of Sydney Water's antiquated and decaying pipe system, cannot cope with the amount of stormwater and there is an overflow to Shelley Beach from Marine Parade and at the oceanside rock face. That occurs approximately four times a year during what are called "events". An event may last from a few hours to several days. When local people ask Sydney Water, "If it has been overflowing each day, is not each day an event?" Sydney Water's answer is, "No, there may be lots of incidents that equal one event."

The gist of the matter is that there is a subproject from the northside storage tunnel project which will rectify the problem. It will close off the Marine Parade overflow weir and there will be an overflow only through the cliff face at the ocean. The number of events, over a 10-year period, will be reduced from 40 to six. The number of incidents will also be greatly decreased. So it is a very worthwhile project which will not only stop the overflow into Shelley Beach—comprising stormwater and diluted sewage—it will also solve one of the problems of the area. There is an odour problem both at the overflow weir along Marine Parade and closer to the small pumping station at the park at Shelley Beach. That welcome improvement will be applauded by the local community.

The project involved an extensive period of community consultation, which I was very pleased to be part of. We shaped how the project was to be carried out. Residents thought that this was the way to go and that Sydney Water should be involved in more examples of a genuine partnership with the community than it has shown in the past. The improvements to Shelley Beach are particularly beneficial because it is part of Cabbage Tree Bay, which is a very special place. It is home to a wide variety of aquatic life, including four of the State's 11 protected fish species, the semiprotected blue groper and the threatened colonies of fairy penguins, which swim in its waters.

On 31 October Manly Council approved a plan of management for Cabbage Tree Bay that will protect the area as a marine sanctuary. Part of the protection offered under the plan of management is the application of a no-take zone for the bay. Establishing and maintaining this area will require an integrated approach between Manly Council and various State government agencies including New South Wales Fisheries, the Department of Land and Water Conservation, the Sydney Ports Corporation, the Waterways Authority, the National Parks and Wildlife Service and the Environment Protection Authority. The decision to make the area a no-take zone has been based on extensive community consultation. Originally, a compromise proposal was suggested that did allow some take, but the overwhelming view of the community was that the unique environment of the area should be protected as fully as possible.

I am pleased to say that Manly Council and the State Government have opted to stand up for the environmental values of the area in the face of intense pressure by those who, under the no-take plan, will no longer be able to fish there. There is ample scientific evidence to show that such sanctuaries allow for replacement of fish stock, which is also for the benefit of anglers fishing in adjacent waters. I call upon the Minister for Fisheries in particular to stand strong and uphold the wishes of the community in this matter.

Mr FACE (Charlestown—Minister for Gaming and Racing, and Minister Assisting the Premier on Hunter Development) [5.14 p.m.]: I will refer this matter to the Minister for Fisheries.

Private members' statements noted.

House adjourned at 5.15 p.m.
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