Full Day Hansard Transcript (Legislative Council, 11 June 2002, Corrected Copy)

LEGISLATIVE COUNCIL

Tuesday 11 June 2002
______

The President (The Hon. Dr Meredith Burgmann) took the chair at 2.30 p.m.

The President offered the Prayers.

The PRESIDENT: I acknowledge that we are meeting on Eora land.

LIQUOR AMENDMENT (SPECIAL EVENTS HOTEL TRADING) BILL

POULTRY MEAT INDUSTRY AMENDMENT (PRICE DETERMINATION) BILL

Bills received.

Leave granted for procedural matters to be dealt with on one motion without formality.

Motion by the Hon. Michael Egan agreed to:

Bills read a first time.

CIVIL LIABILITY BILL

Message received from the Legislative Assembly agreeing to the Legislative Council's amendment.

LOCAL GOVERNMENT AMENDMENT (ENFORCEMENT OF PARKING AND RELATED OFFENCES) BILL

The PRESIDENT: I report the receipt of the following message from the Legislative Assembly:

John Murray

Consideration of message deferred.

PETITIONS

Freedom of Religion

Petition praying that the House retain the existing exemptions applying to religious bodies in the Anti-Discrimination Act, received from the Hon. Jan Burnswoods.

NOTICES OF MOTIONS

Business of the House Notice of Motion No. 1 withdrawn on motion by Ms Lee Rhiannon.

BUDGET ESTIMATES AND RELATED PAPERS

Financial Year 2002-03

Debate resumed from 4 June.

The Hon. JOHN RYAN [2.40 p.m.]: The 2002-03 budget is every bit what we have come to expect from a traditional Carr-Egan Labor budget. It is a triumph for the spin-doctors on the evening it is delivered but unravels the next day when the fine print is examined. This lazy budget was such a risk for the Government that its release had to be carefully scheduled to come to notice only an hour before the evening news, because, like a vampire, it would not survive a moment of scrutiny in the daylight. This budget has already started to unravel. That is not my opinion; that was the judgment delivered in a Sun-Herald editorial at the weekend.

The Hon. Michael Egan: You read the Sun-Herald?

The Hon. JOHN RYAN: Yes, and I hope the Treasurer read it, and read it carefully. It stated:

We will be reading a bit of the fine print of the budget during this contribution. The editorial continued:

So interested is the Treasurer that he is leaving the Chamber, unable to take the scrutiny.

The Hon. Jan Burnswoods: Point of order: First, the honourable member totally breached an undertaken given by the Opposition Whip and is speaking to protect his leader. Second, he made scurrilous allegations about the Leader of the Government.

The Hon. John Jobling: Point of order: The point should be made clear that in my humble opinion there is no point of order. The member speaking is leading for the Opposition; whether it is the Leader of the Opposition or another member should make no difference. It is the choice of the Leader of the Opposition who will speak. Clearly, there is no point of order.

The PRESIDENT: Order! Only the member who seeks and receives the call may address the Chair. However, I remind members that Standing Order 81 is clear: imputations and personal reflections against other members of the Parliament are disorderly.

The Hon. JOHN RYAN: I was only stating a fact, Madam President. The same editorial continued:

Now that the Carr Government has been in office for eight years, we see patterns emerging that establish for certain that it is a tired, lazy and visionless Government whose best days are behind it. Spending on Education in this budget is 10 per cent less than the Fahey Government allocated to that portfolio in 1994, when measured as a proportion of the whole budget. In 1994, Education spending made up 26.5 per cent of the general budget sector. This year the Carr Government will commit only 23.7 per cent. In the 1994 budget, the Fahey Government spent 26 per cent of its budget on Health, compared to 25.2 per cent in this budget. In real terms, the Carr Government is now spending less on capital works for improving public transport than John Fahey did in 1994.

For example, in its last budget, the Fahey Government committed $677 million to the various arms of State Rail. This year's budget for rail transport is $783 million, just 15 per cent more, during a time when prices have risen by 20 per cent. I cannot believe it: there is only one representative of the Government in the Chamber, not even a Minister, to hear the Opposition's reply to the budget. That indicates the unbelievable arrogance of the Government. When it comes to building and renovating new hospitals, the Carr Government's record is even worse. 'The $504 million that the Carr Government will allegedly spend on hospitals during the next year represents a decrease of 10 per cent in real terms when compared to the last Fahey Government budget. And I say "allegedly spend", because this year's capital works budget for the Health portfolio includes around $50 million worth of projects that were either not started or completed last year.

This budget commits $50 million to office fit-outs and relocations and just $40 million to new hospital building projects. That fact alone benchmarks how much the Carr Government has lost touch with the needs of the people in this State. While the Government spends $50 million on moving public servants in and out of new office space, undervalued nurses struggle with pay packages that do not measure up to those of equivalently trained health professionals. The budget does nothing to address the issues that keep half of the registered nurses in New South Wales out of our public hospitals. And without nurses, hospital waiting lists climb and the health needs of many are left unattended.

Currently, 52,200 patients are waiting for elective surgery, and nearly 8,000 of them have been waiting for more than a year. When Labor came to power over seven years ago on a promise of halving hospital waiting lists there were 44,700 waiting for elective surgery, and only 2,265 who had waited for more than a year. Teachers still struggle in crowded infants' classrooms, with the exception of those lucky few who may be involved in the embarrassingly low $5 million trial of smaller class sizes. This budget does nothing to address the falling retention rates that this Government has presided over. When Bob Carr took office in 1995, 70 per cent of young people completed six years of high school. Now the number is just over 67 per cent and it is falling. If it were not for the better rates that are experienced in the private school system the numbers would be even worse.

Department of Community Services workers now claim that the Government has amputated itself from humanity. Very little of this budget is directed to addressing the distressing and increasing levels of child abuse and neglect in our State. Under this Government the face of the Police Service has increasingly become an eaglenet telephone on a locked police station door. The Government has closed 80 police stations, thereby shredding the link between the community and the police that is so necessary for responsive law enforcement. We could compare the Government's public relations babble that appears in the budget papers to the more objective statements about performance indicators for police that appeared in last year's review by the Auditor-General. He wrote:

Report on Government Services 2000

A fair amount of the Treasurer's Budget Speech was spent biting the hand of the Howard Government, ignoring the fact that it has been generously feeding him for the past seven years. The bottom line is that the budget is hundreds of millions of dollars better off because of the sound economic management of the Howard Government.

The Hon. Dr Arthur Chesterfield-Evans: Oh, come on.

The Hon. JOHN RYAN: The budget papers brag that interest payments have dropped from 8� for every revenue dollar to just 3�, saving more than $1,000 million dollars every year. And who did that! Budget Paper No. 2, page 4-13, states:

Gross debt interest expense is expected to fall from $1,792 million to $670 million over the next eight year period ending 30 June 2006 due to ongoing debt reductions as old loans in the debt portfolio are replaced with new loans at lower prevailing interest rates.

And who has been working on interest rates? Clearly, it was the Howard Government. State Government coffers will also be improved as a result of John Howard's policy of giving tax incentives to families to encourage them to take up private health insurance. Fees paid by private patients treated in our public hospitals will increase to $542 million this year compared with $406 million a year in 1999. That means that the State Government has $136 million more to put into the Health budget, a fact that makes its poor performance in Health capital works even more reprehensible.

Over the four years to 2001-03 Commonwealth grants have exceed the New South Wales budget forecasts by well over $900 million. Rather than blaming the Howard Government, the Treasurer should be thanking Mr Costello and Mr Howard for building an economy in New South Wales that has delivered the Carr Government, and the people of New South Wales, windfall after windfall, covering up Labor's lack of financial discipline and credibility.

The budget papers show that the Treasurer misled the media and people across the State when he claimed that the budget had to be delayed a week because New South Wales had been shortchanged by the Commonwealth. The budget papers show that this year New South Wales will receive $15.1 billion in Commonwealth grants for 2002-03. This represents $250 million above the estimate in last year's budget. The Treasurer should stop carping about the changes to the Commonwealth tax-sharing arrangements. The money they are complaining about losing this year is the six-monthly increases in petrol tax that the Commonwealth no longer collects. This tax has gone because the people of Australia wanted action to stem increases in petrol prices. The action the Commonwealth has taken will contribute to a reduction in the rate of inflation, and that will be welcomed by the community at large and assist the bottom line of the New South Wales budget by reducing expenditure in the future.

The Treasurer has done his usual grandstanding at lunches in the central business district, telling businesses that the budget produces a surplus. The surplus in the budget is achieved by accident, not by responsible economic management. That is not a partisan assessment from the Opposition; successive reports of the Auditor-General prove beyond doubt that the Government would have faced a deficit in the past three years if it had not been rescued by an unexpected boom in the property market yielding unexpected tax windfalls. For example, in assessing whether the Government had complied with the principles set out in the General Government Debt Elimination Act, the Auditor-General said in his March 2000 report to Parliament that it was "unclear" whether:

He also said:

But fortunately for the Government, he also said:

Last December he said something very similar about last year's budget. He said:

The GFS-based 'Statement of Budget Result', dealing only with the General Government Sector, showed a surplus. This surplus, while very close to the Budget estimate, came after revenues and expenses both substantially exceeded Budget.

He went on to say:

Excluding [significant] items, the actual result was a $268 million deterioration on Budget. Expenses exceeded Budget by $1.8 billion but the impact of this was largely offset by unbudgeted revenue of over $1.5 billion.

If I were to accuse the Treasurer of providing the Parliament with budget papers which were totally unreliable and practically indecipherable he would accuse me of crass politics. However, that is what the New South Wales Auditor-General has said, albeit in a slightly more tempered way. In his introduction to his annual report on the Treasurer's public accounts and the total State sector accounts, the Auditor-General said:

Nothing in these budget papers does anything to address that concern by the Auditor-General. However, I understand the reason, and it was well explained by the Auditor-General, who said:

The Auditor-General is being way too generous to this Government. There is no way that this Government, which values spin over substance, would ever want honourable members or the public to know whether their budgets were produced by accident, chance or sound management. The likelihood is that they are the result of accident and chance. It is no surprise that the Government has failed to rein in expenditure or provide meaningful tax relief. The Labor Government has collected $12.2 billion in additional revenue over and above what it had estimated between 1995-96 and 2001-02. Actual revenue has on average exceeded budget estimates by 6.5 per cent annually—usually more than double the rate of inflation.

The budget figures show that in 2001-02 Labor will collect total revenue of $33.5 billion, which is $1.3 billion more than estimated, and State taxes of $13.358 billion, which is $1.27 billion more than estimated. In the time Bob Carr has been Premier, revenues have increased by 54.6 per cent. In the same time inflation has increased by only 20 per cent. In real terms, Bob Carr has 34.6 per cent more money to spend than the previous Coalition Government received in its last year of office. One would have to say that with that sort of revenue, only a fool would not be able to balance the budget. The Premier and the Treasurer have simply been riding the property boom. In 2001-02 the Labor Government collected $4.344 billion from property taxes—$1.019 billion more than it had estimated. It has once again underestimated its 2002-03 figures. It estimates that it will collect $4.1 billion from property taxes in 2002-03—but it is very likely to again collect much more.

Behind these statistics are hard-working families who are struggling to get ahead. A family that lives in a median-price home valued at approximately $350,000 and wishes to buy another house, perhaps to improve their job prospects, will have to take into account that the Treasurer's stamp duty will be an extra $11,240, which, if added to their mortgage, will cost them an extra $80 a month. Renters have not missed out on their chance to contribute to the State Government either. Land tax, as a proportion of State taxation, has doubled under this Treasurer, and the receipts have risen from $538 million under John Fahey to $1,047 million in this year's budget, a staggering 94 per cent increase—five times the rate of inflation. A land tax bill may have a property owner's name on it, but it will be a tenant, frequently someone of modest means, who will wind up paying the increase.

The story is similar for payroll tax—the Government's tax on jobs. The budget anticipates receipts of $4,246 million in payroll tax this year. That figure is 64 per cent higher than the amount collected under the last Coalition budget, representing a rate of increase more than three times the rate of inflation. Before I leave the topic of payroll tax I should give a full analysis of the Treasurer's alleged generosity. This budget claims to reduce the payroll tax rate from 6.2 per cent to 6 per cent. That is still the highest rate of payroll tax in the nation. However, the revenue lost by the rate cut will be almost made up by broadening the payroll tax base to include fringe benefits and eligible termination payments. After handing business back $142 million in a full year from the rate cut, the Government will claw back $117 million by broadening the payroll tax base. The full benefit of this budget's tax relief of $215 million pales into insignificance when compared with the $1,600 million extra tax the Government is due to collect on current estimates. It equates to a tiny 0.65 per cent of the total revenues in the budget.

I should leave the last word on tax and expenditure restraint to the Auditor-General, just in case the few honourable members opposite accuse us of partisanship. Last December the Auditor-General included two very interesting tables in his report to Parliament in an attempt to show what the budget result would have been if the Government had increased revenue and expenditure by no more than the amount required to compensate for inflation and population growth. In the budgets from 1996-97 to 2000-01 the Carr Government raised $5.7 billion more in revenue and spent $6.5 billion more than the amount needed to cover inflation and population growth. These results suggested that the Government does not know the meaning of the word "restraint".

While many of the budget overruns were expected, such as the bail-out for HIH insurance policies, budgets have to be framed in such a way as to cater for the unexpected, particularly in times of buoyant revenues like the present. This Treasurer, in particular, does a lot of bragging about his efforts to contain public debt. It is instructive to read the last budget of the former State Government. It becomes very apparent from that document that the former Greiner and Fahey governments initiated most of the policy settings that have resulted in the reduction of the State's debt. The sale of the State Bank removed a huge amount of contingent liabilities. The restructure of the State's public sector superannuation schemes was completed between 1989 and 1992, well before the Carr Government took office. From 1994 the Coalition Government commenced making provision for additional funding to cover unfunded superannuation liabilities.

All the current Government needed to do was continue the same policy. The Treasurer's only contribution to the reform of State superannuation appears to have been an abject disaster. In 1999 the Treasurer legislated to authorise a $3 billion loan aimed at funding an offer to remaining members of old superannuation schemes to convert their entitlements into a lump sum and then join the less expensive First State Super [FSS], which is the fully unfunded superannuation scheme started by the Fahey Government. The Government claimed that the offer had the potential to significantly improve the State's financial position. The Treasurer said that if 16,000 public servants accepted the conversion offer, the unfunded superannuation liabilities would be reduced by more than $1.5 billion. From here I should let the Auditor-General tell the story:

The Auditor-General went on to say:

I am certainly waiting—because it has not happened yet—for the Treasurer to explain to this Parliament why he spent $3 million of the State's scarce resources achieving nothing. It is instructive to read a couple of paragraphs from Budget Paper No. 2 that try to hide, but nevertheless acknowledge, the efforts of former Coalition governments in the so-called miracle that this Treasurer frequently and unfairly claims entirely for himself. The first paragraph reads:

Guess who was in office for nearly half of that period? The second paragraph reads:

Most of what the Treasurer claims as his effort to fund unfunded superannuation liability is the result of a mathematical accident, and that is not something he tells the House too often. The policy settings that he inherited were left behind by the former Coalition Government. Because the Government likes to make crass political statements about the Hon. George Souris, it is important to point out that one of the contributors to the funding of the superannuation unfunded liability was the former finance Minister, George Souris. I have noticed over time that the amount of information provided in the budget papers has become less and less, and what is left has become increasingly technical. Constant changes in accounting standards and methods make year-to-year comparisons more difficult.

Additionally, the Carr Government has done nothing to provide better output information that members of parliament and the public must have to make assessments as to whether government services are provided effectively and efficiently. Increasingly political public relations and spin replace information in the budget papers. Information that the Government may find embarrassing is somehow lost. For example, honourable members will look a long way to find the table of interstate taxation severity that used to be in the Fahey Government budgets. That has gone, mainly because the New South Wales Government finds it too embarrassing to publish. The Auditor-General has also made a number of speeches that make a similar point, and it is worthwhile quoting them for the information of the House. The Auditor-General reported:

Each year the taxpayer contributes around $1.5 billion to the New South Wales Police Service. Why do police services in New South Wales cost less per capita than in Victoria? Or, to put it another way, why do we spend less on police services here? Is it because the police are more efficient here, or is it because they provide a lower quality service? Or is it because we have less crime in New South Wales?

That is certainly not the case. The report of the Auditor-General demonstrates that we have more crime in New South Wales and fewer police, so the only reason the Government spends less on police is that it obviously does not regard that as a high priority for attention. The Auditor-General's report continues:

Honourable members will not find any of that information in the annual reports or the output data in the budget papers, the very information that would tell the public whether the money that is being spent in New South Wales is being spent with any effectiveness. Given the increasing levels of taxation and expenditure in this State, and despite the fact that elective surgery is not decreasing in this State, it is hard not to come to the conclusion that an enormous amount of the health budget in this State is wasted. I am pleased to say that my Leader, John Brogden—in contrast to the Treasurer, who I hope has delivered his last budget—has committed a future Coalition Government to two new measures that will improve budget transparency. First, he has committed us to an independent review of State taxation. Second, he has committed future Treasurers to having budget forecasts signed off by the Secretary to the Treasury to certify that the figures in them have been prepared by officials free of political interference.

I challenge the current Government to subject itself to that sort of transparency. We will spend all of three days considering the budget estimates, and the hearings will all be cobbled together at a time designed to attract the least media attention. The level of scrutiny that this Government has clamped on the budget papers is a complete disgrace. The only reason it has done so is that the Opposition, like the Auditor-General, has concluded that the budget papers disclose nothing. They are full of political spin. They do not provide any meaningful information to the public to allow us to work out what the budget papers mean. If honourable members have discovered in their efforts to read the budget papers that are not very clear, they are not alone: the Auditor-General, who used to work in Treasury, is battling for better detail. I would like to see more detail because, as I have often said to this House, the most powerful thing a government does after it is elected to office is spend the considerable resources that are collected in revenue—about $33 billion a year as it now stands.

A comparison of the level of scrutiny we give to legislation, which often does not touch the lives of individuals, and the lack of scrutiny given to the budget—largely because any attempt to scrutinise it is clamped down on by the Government by its clever use of the numbers in this House—marks a sad day. Those are matters to which we should pay more attention because they are the benchmark of whether this is a useful House of review. If we do not review the budget and subject it to scrutiny, the Government gets away with blue murder—as it has done with this budget. This Government spends billions of dollars but provides little feedback on whether that level of spending has any beneficial impact.

I am not an opportunist regarding rising levels of crime, and I generally temper my views on law and order, but if the Auditor-General of New South Wales says that crime in this State is increasing, I cannot deny or ignore that. If the Auditor-General says that this State spends less on police than any other State in the nation, I cannot ignore that. If the Auditor-General says that we have no meaningful data by which to assess the Health budget, I cannot ignore that. If waiting lists published by the Government tell us that three times more people are waiting for more than 12 months to have elective surgery than when Labor came to office in 1995, the people of New South Wales will not ignore that and will keep that in mind until they chase this Government out of office.

There is every reason why the Coalition should be ebullient about its chances at the next election. At last we are beginning to demonstrate that this Government is more committed to issues management than to the real things that affect the people of New South Wales. If the Government has the audacity to admit in its budget papers that this year it will spend more on moving public servants to new premises than it will spend on new public hospital facilities or projects, then its best days are behind it. The Government is tired and arrogant. It will not be long before the people of New South Wales wake up to that fact, throw it out of office and pass the baton to a group of people, led by John Brogden, who are determined to make sure that this State's public servants and all the resources available to it serve the people of New South Wales to the best extent possible.

I look forward to the further, though limited, scrutiny that Opposition members will be able to give this budget. I have no doubt that the Coalition will seek to demonstrate that the Government has failed on critical social measures. The Government is not protecting children, healing the sick in our hospitals, or protecting the community as it should with the Police Service and court system. Fair Trading is not protecting consumers. No matter what portfolio is referred to, overwhelmingly the Government is failing by any benchmark to do with its budget the things that it should be doing to make the lives of the people of New South Wales better. The Government is coasting on the coat tails of revenues provided by the Howard Government, but it is not putting much thought into expenditure of those revenues. I commend the further scrutiny of the budget to the House. I have little doubt that by the time the scrutiny of this budget is finished the people of New South Wales will be more convinced than ever that the Coalition is well suited to take over from the Labor administration after the election in March 2003.

Debate adjourned on motion by the Hon. Peter Primrose.

LEGAL PROFESSION AMENDMENT (NATIONAL COMPETITION POLICY REVIEW) BILL

Second Reading

The Hon. IAN MACDONALD (Parliamentary Secretary) [3.13 p.m.]: I move:

That this bill be now read a second time.

I seek leave to have my second reading speech incorporated in Hansard.

Leave not granted.

Given that leave has been viciously denied me, I will give the House the benefit of my written words. The Legal Profession Amendment (National Competition Policy Review) Bill continues the process of reform to the regulation of the legal profession which the Government has undertaken since 1995. The changes to the system of regulation represented in the bill will reinforce the position of New South Wales as the pre-eminent Australian jurisdiction in terms of the effective and transparent regulation of the legal profession. Many of the reforms outlined in the bill were first recommended by the Attorney General's Department in its report on the National Competition Policy review of the Legal Profession Act. Since that report was completed, a detailed consultation process has taken place, and the result is the bill before the House.

The first major reform contained in the bill relates to the practising fees for solicitors and barristers. The Act already provides that membership of the Law Society, in the case of solicitors, or the Bar Association, in the case of barristers, is voluntary. However, the practising fees levied on solicitors and barristers include the cost of both membership services and the regulatory activities that the Law Society and Bar Association conduct, as required by the Legal Profession Act. The bill provides for the practising fee to cover only the costs of the regulatory activities undertaken by the Law Society and the Bar Association. This fee will be approved by the Attorney General. The membership or representative activities will be included in a separate, optional membership fee, which solicitors and barristers will not need to pay unless they propose to join the Law Society or the Bar Association. This reform will bring about a true separation of the regulatory and membership functions of the Law Society and the Bar Association. The resulting benefits will include more transparent cost structures of the Law Society and the Bar Association, and potential savings for consumers; and the ability for solicitors and barristers to choose whether they wish to contribute to the cost of membership activities conducted by their professional associations.

In order to ensure the accountability of the Law Society and the Bar Association, the Attorney General may request that budgets be submitted to him before approval of the practising fee. The bill also provides for a person to be appointed by the Attorney General to examine the accounts of the Law Society and the Bar Association, if it is necessary. These measures will ensure that the Law Society and the Bar Association are accountable for their regulatory activities to the profession and to consumers, who ultimately bear the cost of practising fees paid by lawyers. These amendments will commence on 1 July 2004. This will allow enough time for the Law Society and the Bar Association to implement the internal management and accounting changes necessary to accommodate the formal separation of practising and membership fees. As my comments are germane to the bill and as some of the points that I am about to make have already been made in another place, I seek leave to incorporate the remainder of my second reading speech in Hansard.

Leave granted.

I commend the Bill.

The Hon. GREG PEARCE [3.17 p.m.]: The Opposition does not oppose the bill. It is part of the move to implement National Competition Policy and is designed to ensure that the New South Wales legal profession is able to practise throughout Australia. I compliment the Parliamentary Secretary on his most edifying comments. Obviously, I agree with many of them. As I was a solicitor before I came to this place, I have experience of some of the issues addressed by this bill. Indeed, I recall in my early years in practice frequent reference to the dingo fence of restrictions which the Queensland legal profession imposed for many years to ensure no practitioner from any other State was able to practise in Queensland. That did nothing to advance the principles of competition policy or to ensure proper legal practice. I also have the opportunity to be a member of the Law Society Council. I applaud the move to true voluntary membership of the association. That will make that a much more vibrant and reflective body.

The Hon. Jan Burnswoods: Tell us about the campaign office you started in Ryde.

The Hon. GREG PEARCE: The interjection of the Hon. Jan Burnswoods is quite interesting. This bill does a great deal to move forward the practice of law in Australia, and the Opposition commends it.

The DEPUTY-PRESIDENT (The Hon. Tony Kelly): Order! Honourable members will put down the signs.

The Hon. John Jobling: Point of order: Will the Hon. Jan Burnswoods and the Hon. Amanda Fazio remove the signs they are continuing to raise?

The DEPUTY-PRESIDENT: Order! I have asked that the signs be put away.

The Hon. IAN COHEN [3.20 p.m.]: It is with pleasure that I participate in debate on the Legal Profession Amendment (National Competition Policy Review) Bill. The Greens support some aspects of this bill, but certainly will oppose others. Currently, solicitors and barristers pay a practising fee that covers the cost of membership services and the money that is needed for the respective organisation to carry out its regulatory functions. This bill creates a distinction between the two functions. The bill allows solicitors and barristers the option of being voluntary members of the Law Society or the Bar Association. While they will still have to pay a fee so that their organisation can carry out its regulatory functions under the Legal Profession Act, membership fees will be entirely voluntary.

The Greens have a problem with this approach as it amounts to voluntary unionism—a concept that is opposed by the Greens. Compulsory unionism helps unions to become more effective with additional members and more resources. The more members and resources a union has, the more effective it is in negotiating rights and benefits for its members. As a general principle, voluntary unionism is unfair, as often non-members benefit to the same extent as members. For example, the Public Service Association of New South Wales secured a 14 per cent pay rise for its members over four years. Non-members receive this pay increase, despite not having contributed anything whatsoever toward the campaign. With regard to the Law Society and the Bar Association, one aspect of its work which could be construed as a membership function is lobbying.

The Law Society and the Bar Association frequently lobbies the Government, the Opposition and crossbenchers on behalf of its members on issues that affect its members and their clients. Some lobbying is successful and can achieve beneficial results for members and their clients. Why should some members of the profession, who choose not to pay, benefit to the same degree as those who do pay? There are some aspects of the bill that are supported by the Greens—for example, the proposal that requires both the Law Society Council and the Bar Association to publicise disciplinary action that is taken against solicitors and barristers, and requires the Legal Services Commissioner to set up a public register of such action. Lawyers and barristers are extremely expensive. The public should have the right to know what they are paying for. Having said that, I indicate that the Greens do not oppose the bill.

The Hon. Dr PETER WONG [3.23 p.m.]: The Unity party supports the bill, which is part of the National Competition Policy and is designed to open the New South Wales legal profession to all of Australia. Basically, by effectively acknowledging that Australia has moved away from a historically fragmented legal profession, which is a leftover from the old colonial days when each State had a separate legal system, the bill takes us into the twenty-first century. This legislation will allow the States to continue to regulate their legal systems. However, it facilitates the interstate movement of lawyers. The bill provides that any practitioner who holds a practising certificate from another Australian jurisdiction can practise in New South Wales so long as he or she meets certain standards that are set out in the Act. I guess that makes sense, given that increasing competition has the potential of delivering tangible benefits such as choice and, hopefully, reduced legal fees for consumers.

An important consequence of this bill is the separation of the regulatory role and the membership functions of the Law Society and the Bar Association. This is facilitated by the separate imposition of membership and practising fees. The resulting benefits will include more transparent cost structures of the Law Society and the Bar Association, hopefully leading to savings for consumers. Lawyers can choose to contribute, or not, to the cost of membership activities conducted by their legal professional associations. To further protect consumers, this bill also makes a breach of the newly imposed ban on advertising by solicitors sufficient grounds for disciplinary action against the barrister or solicitor. The bill also promotes multidisciplinary practice in the legal profession by removing the power of the Law Society to make practice rules, which prevent solicitors from practising with other professionals, such as barristers, in multidisciplinary partnerships.

Another welcome consumer protection provision of the bill is the requirement for the Law Society Council and the Bar Association to publicise disciplinary action that is taken against solicitors and barristers through a public register of such action. The public register will allow consumers to find out whether a barrister or solicitor they plan to engage has been the subject of disciplinary action by the Administrative Decisions Tribunal following a consumer's complaint. This bill means greater consumer benefits and protection by providing for greater transparency and competition in the legal market in New South Wales. For these reasons, I will support the bill.

The Hon. Dr ARTHUR CHESTERFIELD-EVANS [3.25 p.m.]: This bill is part of the Government's ongoing process to reform the legal profession which began in 1995 and touched on issues such as advertising, multidisciplinary practices and, generally, more transparency of the business of the legal profession. The bill contains a number of changes to the profession's practices. The amendment that has gained the most focus relates to membership. The National Competition Policy, as it applies to the legal profession, will mean that solicitors and barristers will be free to join a legal association other than the Law Society and the Bar Association. At present, membership of the Law Society for solicitors and the Bar Association for barristers is voluntary, but practising fees include both the cost of regulatory activities and the cost of membership services. One provision of this bill will separate these two cost components.

The Law Society has not opposed this bill and is obviously confident that its present members will continue to support the society. My experience is, however, that when people are given a choice of paying a separate membership fee, two-thirds of the membership disappears. I imagine there will be a number of groups with differing interests who may see the advantage of clubbing together outside the confines of the Law Society and, to a lesser extent, the Bar Association. One could imagine the larger firms, of the likes of Freehill and Allens getting together, and perhaps the Labour Lawyers, women's lawyers and so on. Time will tell. Second, the amendment regarding misconduct charges for contravention of solicitors' advertising rules smacks of censorship of the legal profession. Solicitors were permitted greater freedom to advertise through previous legislation, but with the cutting of workers compensation, and now personal injury claims, the Government seeks to again threaten the profession for having the temerity to inform members of the public of their ever-diminishing rights. The Attorney General in his second reading speech set out the Government's attitude. He stated:

Honourable members will be aware that the Government moved quickly to ban certain kinds of advertising by solicitors and advertising relating to personal injury services, when the depth of community concern about solicitors' advertising, and its relationship to the public liability crisis, became clear.

It is clear from that statement that the Government had already begun to contemplate gagging debate on the public liability issue before it introduced its Civil Liability Bill. Third, the amendment regarding multidisciplinary practices removes the power of the Law Society to make practice rules to prevent solicitors from practising with other professionals. In 1999 the Law Society removed restrictions on profit sharing between lawyers and non-lawyers. This amendment seeks to ensure that the way is open for multidisciplinary practices. Obviously, the Government does not trust the Law Society. Some concern was expressed in the other place that it was not a good idea to have, say, accountants and lawyers in practice together. The question is whether accountants would have the same grasp of professional ethics as solicitors. That is a matter upon which honourable members must make up their minds.

Solicitors will still be subject to the same code of ethics that applied to them before the introduction of this bill, even if accountants are not, and perhaps in those circumstances there will be a conflict of sorts. However, the availability of a more flexible business structure is in line with National Competition Policy by making that type of mixed profession more competitive nationally and generally in the marketplace. I must confess that I have some misgivings. Fourth, the amendment requiring barristers and solicitors rules to be publicly promulgated before being made is a good move. If only the Government could apply this type of consultative process to some of its own legislation.

Fifth, the amendment to allow legal practitioners from any other jurisdiction to practise in New South Wales is a good one. It will promote a national legal services market, which will give practitioners more work options. Sixth, the amendment to require the Law Society and the Bar Association to publicise disciplinary action taken against solicitors and barristers is a positive measure. It is proposed that a public register be set up by the Legal Services Commissioner, which will be available on the Legal Services Commissioner's web site. As honourable members would know, I have a bill before the House—the Government (Open Market Competition) Bill—which deals with a similar philosophy, to make government contracts open and accountable.

Overall, the bill may be seen as an attempt to diminish the lobbying power of the legal profession. Over the last five years or so—certainly since I have been a member of this House—the Law Society has been an effective voice for opposition to Government legislation. Indeed, I believe that the legal profession has been a more effective opposition than the Opposition in this Chamber. Its views and suggested amendments to law and order bills especially have been useful to me and many crossbench members. I do not always agree with the Law Society's views but at least they offer an alternative point of view that is well reasoned and well researched. Naturally, at times there is an element of self-interest but that is to be expected from any lobby group. Very often the Law Society acts strongly in the interests of plaintiffs and I believe it should be commended for that. The Law Society is not opposing the legislation and obviously believes that there will be life for it after this bill. We generally support the bill, although we have some misgivings about certain aspects of it.

The Hon. HELEN SHAM-HO [3.31 p.m.]: The Legal Profession Amendment (National Competition Policy Review) Bill initiates further reforms of the legal profession in New South Wales based on the National Competition Policy review. I believe that in general it will further increase the transparency of the legal profession, which is to be supported. The reforms included in this bill are the separation of the functions of the Law Society and the Bar Association, disciplinary action for breach of advertising rules, the encouragement of a national legal services market, and a public register for disciplinary proceedings.

I understand from the Minister's second reading speech that many of the reforms in the bill were recommended by the Attorney General's Department in its report on the National Competition Policy review of the Legal Profession Act 1987. That review was part of the Government's obligations under the Competition Principles Agreement, which was agreed to by the Council of Australian Governments in April 1995. I spoke in this House on the Legal Profession Amendment (Complaints and Discipline) Bill 2000 and the Legal Profession Amendment (Incorporated Legal Practices) Bill 2000, both of which dealt with reforming the legal profession. I supported the Legal Profession Amendment (Complaints and Discipline) Bill as it improved the complaints-handling procedures against solicitors.

However, I strongly opposed the Legal Profession Amendment (Incorporated Legal Practices) Bill. I spoke against that bill as I believed that the incorporation of solicitors firms would result in solicitors being less accountable to clients and the public and being too concerned about shareholders and the financial bottom line. At the time there was opposition to this bill from the New South Wales Bar Association, the Law Institute of Victoria, the New South Wales Legal Reform Group and other Australian groups representing the legal profession. I recall that I opposed that bill even at the second reading stage and the Hon. Peter Breen did the same as we felt so strongly about it. It is seldom that I vote against a bill at the second reading stage.

In my view this bill incorporates aspects of both previous bills. For instance, I do not agree with the separation of the membership and regulatory functions of the Law Society and the Bar Association, and I will discuss that issue later in reference to the Law Society in particular. However, I am supportive of amendments to the Legal Profession Act 1987 in relation to disciplinary issues. The difference between this bill and the Legal Profession Amendment (Incorporated Legal Practices) Bill is that there is no strong opposition to this bill. I have checked with the Law Society and I understand that it is happy with the bill as it stands.

I would now like to discuss the separation of regulatory and membership functions of the Law Society. Honourable members may be aware that until now solicitors and barristers automatically paid for membership of either the Law Society or the Bar Association when they paid for their practising certificate Membership was included in the fee. Most people, many lawyers included, would presume that as the fee was included in the fee for the practising certificate, membership was compulsory. However, as I discovered, membership is in fact voluntary, but due to the interlinking of the regulatory and membership functions that was not clear. The bill will change that. When these changes commence on 1 July 2004 solicitors and barristers will simply pay for their practising certificate and choose optional membership of the Law Society or Bar Association.

I have reservations about the separation of these functions, and although I will not oppose the bill I would like to make clear my reasons for objecting to this. Although I agree with the statement in the Minister's second reading speech that dividing the regulatory and membership role could mean more transparency and may bring savings to consumers, I still believe that being a member of either the Law Society or the Bar Association is important to provide solicitors and barristers with a sense of security and certainty of standards for members.

If legal practitioners decide not to join their professional organisations, the credibility of both organisations may suffer, and I do not believe solicitors or barristers will be better off in the long term. As all honourable members know, the Law Society does considerable work in lobbying the Government, the Opposition, and members of the crossbench. Only last week the President, Kim Cull, and the Director of Policy and Strategy, Shaugn Morgan, spoke to members of the crossbench on the Civil Liability Bill. My concern is that if many solicitors choose not to become members of the Law Society, it will no longer be able to properly represent members. I hope that is not the case. Like any organisation, the strength is in numbers of members. If it does not have sufficient numbers, it cannot be said to represent the legal profession.

The Law Society of New South Wales currently performs two vital functions for solicitors in this State. The society's web site explicitly states that the society has "two primary areas of responsibility. It acts as both licensing and regulating authority and trade union for its members." Historically, the law—like medicine and other professions—has always preferred to be self-regulating, without outside interference. That is clearly why the Law Society has had a dual role in lobbying on behalf of members and also the capacity to discipline them and to maintain professional standards. That is the point I made earlier. If not enough members join the Law Society it cannot be said to represent the legal profession.

As a former solicitor I would like to alert honourable members to the historical background of the Law Society of New South Wales and the importance of membership of the society for all solicitors in this State. According to the Law Society's web site, in 1842 Sir George Gipps, then Governor of New South Wales, stood in this House and stated that solicitors were causing delays in the administration of justice, increasing expense in legal proceedings and claiming excessive remuneration for services. Some honourable members may think that not much has changed since then, but that is a moot point. What is important is that as a result of the Governor's statement six solicitors, with James Norton as leader, joined together as the Sydney Law Library Society and responded to the Governor in the daily newspapers.

More than 40 years later, in 1884, the Incorporated Law Institute of New South Wales was established. Again I refer to the web site of the Law Society of New South Wales. The institute aimed to "consider, originate and promote reform and improvements to the law, to represent generally the views of the profession, and to encourage and promote the study of law". In 1935 the institute was granted powers under the Legal Practitioners Act relating to solicitors' trust accounts, the discipline of solicitors and the issuing of practising certificates. Solicitors who paid the practising fee automatically became members of the institute. In 1960 the institute changed its name to the Law Society of New South Wales, which reflects changes to the role of the society and to the legal profession as a whole. I am sure that those honourable members who studied law will recall that the Law Society of New South Wales set up the Law Foundation, which is now called the Law and Justice Foundation, from the interest earned from solicitors' trust accounts.

Through the Law Foundation the Law Society was able, in 1973, to establish the College of Law, which continues to provide practical legal training for solicitors instead of articles of clerkship. In 1986 I attended the College of Law after I finished my law studies at Macquarie University. In those days everyone who studied law and who wanted to practice law went to the College of Law to complete their practical qualifications. But these days only half of all law graduates finish their studies at the College of Law. When my daughter finished her law studies at the University of Sydney she did not go to the College of Law. Not everyone wants to practise law.

I refer now to disciplinary proceedings against solicitors and barristers. As someone with a legal background I am fully aware of the difficulties that consumers face when making complaints about solicitors or barristers. Members of the public face these difficulties because they are not told about the disciplinary actions that are taken against lawyers. I am pleased that the Law Society Council and the Bar Association now have to publicise disciplinary actions taken against solicitors and barristers. The Legal Services Commissioner has to keep a public register of disciplinary action on the commission's web site. As the Minister said in his second reading speech, this will increase the transparency and accountability of the legal profession. The legal profession has an important task to perform in the public interest.

I know of someone who was recently involved in a huge court case who had difficulty in dealing with his solicitor. The solicitor, who had already been paid, refused to act in the way that was expected of him and, in the process, he jeopardised the court case. If a complaint is made about that solicitor and disciplinary action is taken against him by the Law Society of New South Wales it would help all other consumers of legal services to know that that solicitor was brought into disrepute. Consumers would, therefore, be more wary of hiring such a solicitor. Such solicitors should be held accountable and consumers should be able to lodge complaints against them. I support the Legal Profession Amendment (National Competition Policy Review) Bill and commend it to the House.

Reverend the Hon. FRED NILE [3.43 p.m.]: The Christian Democratic Party supports the Legal Profession Amendment (National Competition Policy Review) Bill, which will amend the Legal Profession Act 1987 in a number of areas relating to National Competition Policy reform. I am particularly supportive of paragraph (b) in the overview of the bill, which states:

(b) to provide that a contravention of the advertising rules for barristers and solicitors is capable of being professional misconduct or unsatisfactory professional conduct.

The bill will control advertising—if possible, there should be no advertising—by solicitors and members of the legal profession. Such advertising has had a negative impact on workers compensation and civil liability cases. I am pleased that there is provision in the bill for specialist training schemes. As laws are amended and changed, barristers and solicitors should keep up to date with those procedures: they are an essential requirement in our complex society. Paragraph (d) in the overview of the bill states:

(d) to make it clear that solicitors may practise in multidisciplinary partnerships, despite anything to the contrary in the solicitors rules, and that barristers may also practise in multidisciplinary partnerships, subject to the barristers rules.

I am sure that all honourable members are concerned about multidisciplinary partnerships. Honourable members would be aware that I am not a lawyer, but I have watched a number of programs on television depicting such partnerships. I suppose that I should not judge the legal profession in Australia by the legal practices that are depicted in American television programs such as LA Law. However, they appear to convey an element of ruthlessness that is apparent in large corporate legal firms. It would be a pity if that sort of ruthlessness developed in Australia. It might already be apparent in a number of large legal firms in Australia. Paragraph (g) in the overview of the bill states:

(g) to require the Bar Council, the Law Society Council and the Legal Services Commissioner to publicise disciplinary action taken against barristers and solicitors.

I support that provision in the legislation. I am concerned about recent public revelations about barristers—I do not believe too many solicitors were involved—who deviously and immorally evaded income tax by not lodging tax returns. I am sure many other honourable members feel the same way. Tax bills worth millions of dollars would accumulate over a number of years and those barristers would then declare themselves bankrupt, thus evading their taxation bills. As they had declared themselves bankrupt there was no requirement for them to pay the tax bills. They would continue in their legal practices and go through the same exercise. One or two barristers declared themselves bankrupt on more than one occasion.

When that story was made public, obvious embarrassment was shown by representatives of the Law Society and the Bar Association, but they could not bring themselves to condemn those barristers. I was disappointed that they appeared to be nervous about coming on too strong. They should have been more outspoken and condemned the activities of some of their members. Since then action has been taken in relation to those respective bodies. In the main I have always had good service from solicitors and barristers.

I have had a great deal to do with Ferguson and Carter, solicitors in Gerringong, who have been helpful and efficient. I have also had good service from Beswick, solicitors in Sydney. On one occasion when a barrister represented me in a defamation case I reluctantly agreed to an expensive settlement. I had to pay out tens of thousands of dollars in a case in which I, as a layman, did not believe I was guilty, but I had to accept the legal advice of the barristers who were representing me.

The Hon. Ian Macdonald: Did you have to pay the mardi gras some money?

Reverend the Hon. FRED NILE: No. I had to pay the Chief Censor because I criticised its approval of the Hail Mary film. How can a person be found guilty of defamation when dealing with the Chief Censor? I thought those sorts of people were open to criticism from the Left and the Right. I criticised the Chief Censor for allowing the film to be shown. After the settlement the barrister sent me a bill for the following week when the case was to go before the Supreme Court. The case did not go before the Supreme Court but the barrister thought I should still pay his fees for that week.

I was particularly disappointed when I found out he had another important case—and I will not mention any names—which he must have known about some weeks prior to my case being listed. My barrister could have adjusted his calendar to fit in my case. I paid the barrister's fees because I was threatened. I did not know that other avenues were open to me. I was told, "If you do not pay these fees you will go on some sort of black list and no-one will represent you in the future." I reluctantly paid thousands of dollars for a court case that was never held. With that exception, in the main I have received good service from barristers and solicitors. I support the bill.

The Hon. PETER BREEN [3.50 p.m.]: I support the broad objectives of the Legal Profession Amendment (National Competition Policy Review) Bill. Most importantly, the bill draws a distinction between fees paid to the Law Society and the Bar Association in connection with the exercise of their regulatory functions on the one hand and member services on the other hand. As a consequence of the bill becoming law, membership of the Law Society and the Bar Association will be voluntary, at which time I believe members will leave the Law Society in droves as most solicitors regard it as a waste of space. Most law consumers would express a similar view once they had any experience with the Law Society. Unfortunately for the Law Society, it has never succeeded in representing the interests of both solicitors and law consumers. In my opinion, the Law Society has failed everybody.

The problems with the Law Society to which I have referred—I have also mentioned them in previous debates—centre on two issues: first, the Law Society's professional indemnity insurance company, LawCover Pty Ltd, and, second, the conduct and discipline of the legal profession. Self-regulation simply does not work at the Law Society. I was pleased to read in the Attorney General's second reading speech that he plans to bring forward a comprehensive reform package in that respect in the near future. That reform package is well overdue. The issues paper has been around for some time and on several occasions the Attorney General promised to address the matters dealt with originally by the Law Reform Commission. The Attorney General in effect took it out of the hands of the Law Reform Commission, and many people are waiting anxiously for his final decisions about the various issues.

Allowing the Law Society to look after the conduct and discipline of the legal profession is a nightmare for law consumers. As for LawCover, the Law Society's professional indemnity insurance company, hardly a week goes by without my receiving a complaint about the way it goes into battle against law consumers on behalf of New South Wales solicitors. Reverend the Hon. Fred Nile related a personal incident concerning a barrister and legal costs, and I was reminded of an issue that was brought to my attention only last week when I received a telephone call from Fred and Evelyne Lettice requesting an appointment. I had seen a report about their case on Stateline and, although I was not fully acquainted with the facts, I was happy to speak with them about it and to canvass the various issues involved.

In 1994 Mr and Mrs Lettice sued their solicitor for negligence over a conveyancing error. When they bought their 25-acre property at Theresa Park in 1982 their solicitor made a mistake about a right of way and, as a result, part of the property is landlocked. Based on further legal advice, Mr and Mrs Lettice sued in the Supreme Court over the reduced value of the land as a consequence of the solicitor's mistake. As honourable members might expect, Mr and Mrs Lettice won the case. However, the referee's decision was not good enough for LawCover, and the solicitor's professional indemnity insurer appealed the Supreme Court decision to the Court of Appeal. Three judges held on appeal that the solicitor's mistake was discoverable within the six-year period of the statute of limitations, and therefore Mr and Mrs Lettice could not recover their damages from the solicitor.

Reading the judgment of the Court of Appeal in that case left me shaking my head. The logical conclusion of the court's ruling is that every conveyancing transaction undertaken by a solicitor must be checked every six years. After six years, law consumers lose the protection of the solicitors professional indemnity insurance policy. That decision gives a whole new meaning to the expression "time heals all wounds". One wound the decision will not heal, however, is the hole in Mr and Mrs Lettice's pocket. The day after I interviewed Mr and Mrs Lettice they received a creditor's petition from LawCover's solicitors, Mallesons Stephen Jaques, following the issuing of the bankruptcy notice to recover LawCover's costs on the appeal. What were those costs? The creditor's petition claims the sum of $408,420.57. Needless to say, this is an obscene amount of money and, as far as I am concerned, it is a scandal that LawCover and its marble and glass lawyers can take action of this kind under the negligent solicitors insurance policy in respect of a bona fide claim.

In my opinion, Mr and Mrs Lettice were robbed by their solicitor when they bought the land, they were robbed again by the Court of Appeal when it overturned the Supreme Court decision and, finally, they were robbed when LawCover's solicitors issued the creditor's petition for legal costs of Oz Lotto proportions. Alex Mitchell wrote an excellent article, which appeared in last weekend's Sun-Herald, about why lawyers do not want to become judges. He quoted the colourful criminal lawyer Chris Murphy as saying that many barristers regard elevation to the judiciary as an escape from unemployment at the bar. My advice to unemployed lawyers is to get a job at Mallesons Stephen Jaques, where members of the legal profession earn thousands of dollars for standing by a fax machine and terrorising ordinary people who have been dudded by their solicitors. Opposite Alex Mitchell's article appeared a piece by David Brown of the University of New South Wales headed "Silly old duffers' tag taking toll on Bench". In the article Brown referred to:

However, the judiciary is not immune to criticism. Its members are lawmakers and part of the government. If judges fail ordinary people such as Mr and Mrs Lettice they deserve to be criticised.

The next part of the bill refers to advertising by a barrister or solicitor. The conduct of the Law Society has been particularly bad in this area. Members of the Law Society never wanted to advertise their services but the Law Society negotiated with the Greiner Coalition Government to allow solicitors to do so. The resulting advertisements caused an enormous amount of anxiety in the community and brought a great deal of discredit to lawyers. Honourable members will be aware that barristers never advertised; it was only solicitors who decided to go down that track because of a decision made not by them as a group but by their representative body, the Law Society. I commend new laws that limit advertising by solicitors but I question the likely effectiveness of the bill's provisions that deem certain types of advertisements professional misconduct or unsatisfactory professional conduct.

By way of comparison, overcharging is also professional misconduct or unsatisfactory professional conduct and is an enormous problem for law consumers who constantly knock on my door to complain about their solicitors' and barristers' bills. The example that Reverend the Hon. Fred Nile gave a moment ago is no isolated incident: the majority of complaints made to the Legal Services Commissioner involve lawyers' costs. Today I looked through the current edition of the Law Society's publication Law Society Journal, which is the magazine distributed to members of the Law Society. I was interested to read an article by Marina Wilson about overcharging, which concludes:

As I said earlier, the majority of the complaints that the Legal Services Commissioner deals with relate to legal costs. The commissioner is frequently confronted with the question: Does this level of overcharging constitute professional misconduct or unprofessional conduct? The Legal Services Commissioner frequently comes to the answer that it is simply too difficult to argue with the solicitor or barrister about whether their costs are excessive.

Pursuant to sessional orders business interrupted.

QUESTIONS WITHOUT NOTICE
_________

NORTH HEAD QUARANTINE STATION

The Hon. PATRICIA FORSYTHE: My question without notice is to the Minister for Juvenile Justice, representing the Minister for the Environment. Is the Minister aware that the decision to lease and deny public access to the North Head foreshore and Quarantine Station will result in thousands of tourists trampling through the critical breeding habitat of the near extinct fairy penguin? Has the Minister raised concerns about the survival of the fairy penguin colony with the Minister for the Environment and the Premier? If so, what was their response?

The Hon. CARMEL TEBBUTT: The House would be well aware that my colleague the Minister for Planning has set up a commission of inquiry to assist with the assessment of the quarantine station proposal. The inquiry will examine, in an open and transparent manner, all environmental and heritage implications of the proposal. The public hearings of the commission of inquiry have now been completed, and the Minister for Planning is awaiting a report from the commissioner.

The Hon. Patricia Forsythe raised issues with regard to critical habitat declaration. The Threatened Species Conservation Act and the Environmental Planning and Assessment Act set out the requirements for approval of activities within an area identified as critical habitat. Activities that have been approved through an environmental impact statement [EIS] and a species impact statement determination can be undertaken within an area identified as critical habitat.

With regard to the proposal for the use of the quarantine station, both an EIS and a species impact statement have been prepared in full knowledge that a critical declaration was contemplated to assess the range of likely impacts on the little penguin population. The EIS and the species impact statement are presently being assessed through the commission of inquiry and the determining authorities. If the proposal is approved, the activity may proceed and any final critical habitat declaration will not affect the terms of the approval.

While concerns have been expressed about the quarantine station proposal by a range of sources, it may be useful to remind the House that the entire leasing process was commenced by the Coalition when it was last in government by none other than the honourable member for Gosford.

INDUSTRIAL RELATIONS

The Hon. IAN WEST: My question without notice is to the Special Minister of State, and Minister for Industrial Relations. Will the Minister inform the House how the New South Wales industrial relations system promotes industrial co-operation?

The Hon. JOHN DELLA BOSCA: Honourable members would be well aware of the campaign by the Howard Government to take over the industrial relations systems in New South Wales and the other States. The Federal Minister for Workplace Relations, Tony Abbott, has made his plan very clear—although he conceded to journalists in Sydney last month that it was virtually impossible while Labor was in power in New South Wales. He was quite right: it was an accurate observation. A Labor Government in New South Wales will not give away the co-operative system developed over the past 100 years. But Mr Abbott is persistent. His latest attempt works in this way. He will insist that any Federal moneys used for construction projects will require unfettered on-site access by the Office of the Employment Advocate to police the ideological agenda of the Howard-Abbott Government.

If Tony Abbott is truly committed to ensuring good industrial relations and greater productivity outcomes on construction projects, he should carefully examine the success of the best-ever Olympic Games, which were held in Sydney. The Games set the benchmark for industrial co-operation between unions and employers and was underpinned by the making of an award in the New South Wales Industrial Relations Commission. The Government-union partnership that resulted ensured a high priority on safety, a commitment to worker training, no illegal employment practices, and minimal industrial disputes. It showed how industrial relations on this massive project could succeed and contribute to the productivity and success of the overall project.

Let us compare this to the microcosm of Tony Abbott's vision of industrial relations: Victoria, which had its industrial relations laws jettisoned in favour of Federal legislation. The Victorian industrial landscape is now held captive by intractable disputes between parties, with a hamstrung Federal commission unable to effectively resolve their differences. That has led to a phenomenon in which employers are trapped in a system where every action they take meets with an equal counter-reaction by unions. Examples of that phenomenon include the 2�-year dispute at the O'Connor meatworks in Pakenham, which finally ended last year; the Nestle dispute at Echuca, which involved strikes and work bans for three months in 2001; a five-week dispute as part of the campaign 2000 dispute at Feltex carpets, and the creation of militant and anarchic groups such as Workers First.

That might look great in the ideological agenda of Tony Abbott and John Howard, but it is no good for Victorian workers or, ultimately, for Victorian employers. The Carr Government has stated before, and will state again, that it will not hand over its industrial relations powers to Canberra. Any move to a unitary system of industrial relations, whether by a direct method of legislative handover or by this latest backdoor attempt by Tony Abbott, will be firmly resisted by this Government.

POLICE TARGET ACTION GROUPS

The Hon. MICHAEL GALLACHER: My question without notice is to the Minister for Police. What action has the Minister taken following the break-up of the Georges River region Target Action Group [TAG] at Hurstville to ensure that officers are redeployed to local area commands in the Sutherland shire? Can the Minister inform the House why 10 of these TAG officers, who were to be based at Cronulla from 1 July, have now been told to apply for positions elsewhere? Has the Minister investigated concerns that the nearest TAG unit to the Sutherland shire will now be an undermanned squad at Riverwood which currently has insufficient staff to look after its own designated areas?

The Hon. MICHAEL COSTA: The Leader of the Opposition's question is rather premature, because no decisions have been made regarding the TAGs. As a consequence I am not able to respond to allegations about changes that are not in the pipeline. As soon as the decisions are made in relation to TAGs and the allocation of all scarce resources within the police restructure, I will make those details available for the public of New South Wales.

ABORIGINAL RECONCILIATION

The Hon. HELEN SHAM-HO: My question without notice is to the Special Minister of State, representing the Minister for Aboriginal Affairs. Given that Monday 3 June marked the end of National Reconciliation Week and, most importantly, the 10-year anniversary of the High Court's Mabo decision, will the Minister inform the House what action the Government is taking to ensure that the reconciliation process stays alive in New South Wales?

The Hon. JOHN DELLA BOSCA: The Government is very conscious of its obligations in relation to reconciliation and, as the Hon. Helen Sham-Ho would be aware, a number of initiatives were undertaken to mark that commitment. It would most appropriate for me to get a detailed response to the honourable member's question from the Minister for Aboriginal Affairs and provide it to her as soon as possible.

INFORMATION AND COMMUNICATIONS TECHNOLOGY CENTRE OF EXCELLENCE

The Hon. TONY KELLY: My question without notice is to the Treasurer, and Minister for State Development. Will the Minister inform the House about the new Information and Communications Technology Centre of Excellence?

The Hon. MICHAEL EGAN: Last month the New South Wales based National Information and Communications Technology bid was chosen as the preferred candidate to establish and operate Australia's Information and Communications Technology [ICT] Centre of Excellence. The centre will be a world-class research and training institution with significant links with industry, including commercialisation opportunities for Australian information and communications technology [ICT] companies through collaborative research, incubator development, staff exchanges and information sharing. It will build on the status of New South Wales as the ICT capital of Australia and one of the leading ICT hubs in the Asian-Pacific region. The $130 million centre is expected to attract domestic and international investment and inject more than $1 billion into the New South Wales economy over the next 15 years.

The centre will staff up to 660 researchers and students and create more than 500 new PhD places over the next ten years. The New South Wales Government's initial commitment of $20 million will bring jobs as well as investment into the New South Wales economy. In the first year alone 50 jobs will be created at the Redfern site, growing to 400 jobs over the next five years. In the long-term more than 1,000 jobs will be created in information, communication and technology employment. The centre will establish its headquarters at the Australian Technology Park in Redfern and will have additional locations at the University of New South Wales and the Australian National University in Canberra.

The announcement that the Information and Communications Technology Centre of Excellence will be located in Sydney has already had an impact. Leading international information technology companies have been in contact with the New South Wales Government to explore the option of locating on site with the centre of excellence. Through its integrated approach to innovation, education and ICT industry development, the Information and Communications Technology Centre of Excellence will boost the capability of our ICT industry and deliver substantial productivity gains across all sectors of the New South Wales economy. As a result, the centre will contribute to better living standards and higher rate of economic growth for New South Wales and the Australian community as a whole. I welcome the Deputy Leader of the Opposition in the other place. It suggests that there is another leadership coup under way. It does not matter who they want to serve up to us, we will knock them over.

DOG CONTROL

The Hon. JOHN TINGLE: My question without notice is addressed to the Leader of the Government, in the absence of the Minister for Fisheries, representing the Minister for Local Government. Is it a fact that the Minister has decided, on expert veterinary advice, not to ban certain breeds of dog which have been associated with a series of recent savage attacks on children and adults? Is the Minister satisfied with the level of compliance with the legal requirement to have a dog under restraint at all times while off the owner's premises? If not, and in view of the decision not to ban vicious dogs, will the Minister ask local councils to enforce the leashed dog laws and, if necessary, will he legislate to provide those councils with adequate penalties to encourage compliance with the law, that is, to make people keep their dogs on leads?

The Hon. MICHAEL EGAN: I suppose if I had kept my dog on a leash he would not have run away! I thank the Hon. John Tingle for an important question. I do not know the answer. I will refer it to my colleague in the other place and obtain a response as soon as possible

POLICE RECRUITMENT TELEVISION ADVERTISEMENTS

The Hon. DUNCAN GAY: My question is to the Minister for Police. What has been the total cost of producing and buying large slabs of air time for the new so-called police recruitment television advertisements? Given that the advertisements barely acknowledge the fact that they are for recruiting purposes, should they not instead be labelled as election advertisements, to be paid for and authorised by Sussex Street?

The Hon. MICHAEL COSTA: I take exception to the comments made by the honourable member. I have had nothing but good feedback about the advertisements; they are very good. The police officers I have spoken to congratulate the police force for investing in those advertisements because not only do they depict circumstances that police encounter daily, they also project an image of policing that the community wants to see. That is important for police morale. The police have advised me that the advertisements have been tremendously successful. The police web site has received approximately 33,000 hits since the advertisements commenced. The normal number is 2,000 hits per day. These advertisements have been a tremendous success. They fit in with the recruitment campaign to lift our record police numbers to greater record numbers. Again I thank the Treasurer for his generosity this year. I cannot mention the budget—that is for another time—but I thank the Treasurer for his generosity with a record amount of funding. The police have also advised that since Sunday 9 June, when the advertisements went to air, they have had 2,718 requests for information application packages.

The Hon. Michael Egan: How many?

The Hon. MICHAEL COSTA: They have received 2,718 requests for information packages—a tremendous result from the advertisements. The figures show how successful the campaign has been. One has to understand that the advertisements make it clear how tough policing is but how, at the same time, it can be a rewarding profession. The advertisements tell it as it is and remind the community that our police are heroes. So it is with great pleasure that I congratulate the police force for its advertisements. They work; they are doing what they were designed to do. In relation to the cost, as the commissioner said on the first day of the campaign, $1 million was spent developing the advertisement. I do not have the actual cost of the campaign with me but I am certainly able to get those details and make them public. There are no secrets. The advertisements are aimed at the important process of ensuring that adequate numbers of police come through our training courses. That is what we have now: great numbers. As honourable members know, there were 410 from the last attestation.

In answer to a question asked last week by the Leader of the Opposition I said that there are clear problems in finding places for the next attestation, given the record numbers coming through. I made it clear that we will hold the next attestation in Goulburn. Certainly there is a problem, but it is a problem we want. What a problem: not enough room for attestations because of the record numbers coming through! The police advise me that at the moment there are 1,300 people in training. It is a tremendous achievement to be in a position where we have to look at alternative venues because of the record numbers. The fact that there were 33,000 hits on the police web site after the advertisements shows it is a tremendous campaign. I congratulate everybody who was involved in the production and airing of the advertisements.

YOUTH PARTNERSHIP WITH ARABIC SPEAKING COMMUNITIES

The Hon. RON DYER: My question without notice is addressed to the Minister for Juvenile Justice, Minister Assisting the Premier on Youth and Minister Assisting the Minister for the Environment. Will the Minister inform the House of progress in the youth partnership with Arabic speaking communities?

The Hon. CARMEL TEBBUTT: It is an important initiative, particularly because the initiative came in the first instance from members of the Arabic community who put an idea to the Premier two years ago. Members of the Arabic community were concerned about development opportunities for young people in their community and the idea was for a partnership with government that would provide targeted support to young people from Arabic speaking backgrounds and their families. This idea has become the youth partnership with Arabic peaking communities. The partnership is overseen by an implementation committee which comprises, importantly, young people as well as community organisations and leaders in government, assisted by my colleague the Minister for Mineral Resources, and Minister for Fisheries.

Backed by Government funding, community leadership and support, the youth partnership is an innovative program that is making a difference. Its aims are to promote the well-being of young people of Arabic descent, to increase parental support and education, to help prevent risk-taking behaviour and to provide better learning opportunities and increased participation in sport, recreation and culture for long-term personal development. The first stage of the project has put in place youth liaison teams whose job it is to meet with young people in places where they gather. This is very much in recognition of the fact that young people often do not actively seek out services, even when they need them. If we are to be effective in linking young people with appropriate services, we need to be in the places where young people are. We need to talk with them in a less formal way and in that way have the opportunity to link them up with services, should that be necessary.

The teams are also working with families, schools, local councils, police, health and other agencies to connect young people to services they need. Two weeks ago in Bankstown I launched the next stage of the Government's youth partnership with Arabic speaking communities, which is the Youth Leadership Development Program. This program is a partnership between the Government, the Institute for Cultural Studies at the University of Western Sydney, young people and community organisations.

The program aims to give at least 75 young people the chance to learn skills and take on a leadership role within their communities and neighbourhoods. It involves workshops and training followed by the design and implementation of a local project picked by the young people in the program. Some of the projects could include web site development, advocacy at local council level for a youth issue or setting up a mentor scheme. Those who complete the program will receive recognition from the University of Western Sydney and they will also have the chance to go on to apply for the Duke of Edinburgh Award Scheme. It is a promising program with large community support.

Iktimal Hage Ali and Mahmoud Dehn are two young people who have been actively involved with the implementation committee. Those young people are to be congratulated on the contribution they are making. Hopefully, the leadership program will ensure that other young people of Arabic speaking background will have the opportunity to improve their ability to be leaders within their own community. The Government's contribution ensures that the program will be relevant and real for those young people who will participate. I look forward to reporting further progress to the House.

POLICE POWERS LEGISLATION PROCLAMATION

The Hon. Dr PETER WONG: My question without notice is directed to the Minister for Police. Is the Minister aware that almost a year ago Parliament passed the Government's Police Powers (Internally Concealed Drugs) Bill at the request of the police to catch dealers who seek to avoid arrest by swallowing the evidence, such as balloons of heroin. However, as of today the police still cannot use these powers because the Government has yet to proclaim this legislation. Will the Minister detail to the House the nature of the delay and advise when the Government intends to proclaim these powers?

The Hon. MICHAEL COSTA: There is no intention not to proclaim the legislation. I am advised that it will be proclaimed on 1 July. Suitable arrangements have been made with health practitioners so that the searches can take place. As honourable members will appreciate, these searches are an unpleasant task and they need to be undertaken by the appropriate people. The cause of the delay has been putting the appropriate health practitioners in place to undertake police searches. As I said, the legislation will be proclaimed on 1 July.

POLICE NUMBERS

The Hon. JAMES SAMIOS: My question without notice is to the Minister for Police. Why has the Minister failed to put monthly statistics relating to police numbers on the New South Wales police web site since March, given his commitment in response to a question I asked on 27 November last that they "will be placed on the web as soon as possible"?

The Hon. MICHAEL COSTA: Police statistics are going onto the web site as soon as practicable.

The Hon. Michael Gallacher: Why are they taking so long?

The Hon. MICHAEL COSTA: If the Leader of the Opposition will relax, he will hear the answer. If it were not for me, the statistics would not be going on the web site in the first place. The Government placed those statistics on the web, or directed the police force to place them on the web. They are important statistics and everybody is entitled to know what the police numbers are.

The Hon. Duncan Gay: You are ashamed of them, aren't you?

The Hon. MICHAEL COSTA: No, I am certainly not ashamed of statistics that will show 410 additional probationary constables from the last attestation. The statistics will show that we have more police officers now than we have had over the past five or six years. We certainly have more police than were around when the Coalition was in government. If those statistics are not on the web site, I will make inquiries and make sure that they are put on. These matters do not come directly under the jurisdiction of my office. They need to be dealt with through police management, and I will speak to police management about them. There is no intention of not putting those statistics on the web site. It is the policy of the Government that they be there.

The Hon. Greg Pearce: Why has it taken six months?

The Hon. MICHAEL COSTA: It certainly has not taken six months. That is ridiculous. The statistics have been on the web. The question asked by the honourable member talked about the statistics for last month.

The Hon. Michael Gallacher: Last month?

The Hon. MICHAEL COSTA: May and April I think he is talking about.

The Hon. Michael Gallacher: No, the last three months.

The Hon. MICHAEL COSTA: No, that is not right. They have been on the web. We will put the statistics on. There is no intention of not having them there. I would be proud to have them there because they will show that under our Government this State has record numbers of police. We are proud of that.

CAR HOONS

The Hon. HENRY TSANG: My question without notice is to the Minister for Police. What are the latest government measures to target car hoons?

The Hon. MICHAEL COSTA: The problem of car hoons was first brought to my attention by the honourable member for Kogarah and the honourable member for Rockdale. They are both outstanding members of Parliament who have been fighting for their community for a number of months to ensure that the problem of car hoons is dealt with. If only the Liberal Party could find some outstanding members similar to them, it might be in a position to make an impact on the politics of this State. Unfortunately for the Liberal Party, people of this quality will not go anywhere near it.

I was startled to hear from residents and shopkeepers in the Brighton-le-Sands area about the problems associated with car hoons. I made a commitment to discuss the matter with the Minister for Transport to see if we could resolve the problems in the interest of the community. Anybody who has been there will have seen how these kids—and they are not only kids—with expensive and dangerous toys cause a great many anti-social problems for local residents, with tyres screeching and music blaring from very loud speakers. Some of these people illegally modify their cars by taking out the back seats and putting in large speakers which play music very loudly.

The Hon. Duncan Gay: With coloured shirts?

The Hon. MICHAEL COSTA: It is a blue shirt. The Government has developed a sensible response to the car hoon problem. From 1 July car hoons will be hit where it hurts—on their licence. My colleague the Minister for Transport will introduce a demerit points system for car hooning and will double many fines. Some of the penalties are the loss of two demerit points for excessive vehicle noise. Causing offensive noise from a vehicle sound system will mean the loss of another two demerit points. Someone who starts or drives a vehicle causing excessive noise or smoke will lose two demerit points. The best way to deal with car hoons is to target them where it hurts, that is, their licences.

Police tell me that many of these drivers spend $5,000 for a set of alloy wheels—or even $25,000 on a paint job. For repeat offenders, the current fines are not effective. That is why we are linking these offences to the demerit point system. People who continue this sort of behaviour will lose their licences. They will be off the road completely. Added to that, a pool of Environment Protection Authority officers will join with police and the Roads and Traffic Authority in blitzes on hoon hotspots. The more the chance of getting caught, the more chance there is they will get the message.

These changes build on the Government's illegal drag racing laws introduced in 1996. That legislation gave police the power to issue defect notices in relation to illegally modified vehicles and to impound any vehicle involved in street racing. So far this year 135 cars have been confiscated and more than 400 charges have been laid. The Government, NSW Police and the community will not tolerate car hoons. I commend the honourable member for Kogarah and the St George Local Area Command for their work in developing these initial proposals. As I said, we have two terrific members of Parliament in that area who put a lot of effort into meeting the concerns—

The Hon. Michael Gallacher: Unlike the rest.

The Hon. MICHAEL COSTA: No, the rest of them are good too, as you will see. These two members of Parliament have put a lot of effort into dealing with the problem of car hoons. It is because of their efforts that the new demerit points system will come into effect from 1 July. I congratulate both members on their efforts.

OLNEY STATE FOREST THREATENED SPECIES PROTECTION

The Hon. Dr ARTHUR CHESTERFIELD-EVANS: My question is to the Minister Assisting the Minister for the Environment. Is the Minister aware of alleged breaches by Forestry NSW of the integrated forestry operations approvals regulations regarding threatened species in compartment 35 of Olney State Forest? What is the result of the inspection by the threatened species unit of the National Parks and Wildlife Service on 5 June this year? Will prosecutions result from this inspection?

The Hon. CARMEL TEBBUTT: The question raises a number of detailed issues to which I cannot respond today, but I will refer the question to the Minister in the other place and get a response as soon as possible.

JUANITA NIELSEN DISAPPEARANCE INVESTIGATION

The Hon. JENNIFER GARDINER: My question is directed to the Minister for Police. Given his stated admiration for the New South Wales Crime Commission, which he referred to as a fantastic body, will he undertake to establish what that agency will do to solve one of the State's highest profile unsolved crimes: the Juanita Nielsen case? If the Crime Commission tells the Minister that it cannot solve that crime or that it will not try to, will he undertake to advise the House of the reason for such an assessment?

The Hon. MICHAEL COSTA: That question clearly involves an operational matter. I will take advice before I comment on the matter.

HUNTER FILM INDUSTRY

The Hon. AMANDA FAZIO: Will the Treasurer, and Minister for State Development provide the House with details of the latest achievements of the New South Wales film industry in the Hunter?

The Hon. MICHAEL EGAN: Like the earlier question of the Hon. Tony Kelly, the question asked by the Hon. Amanda Fazio is a good one. I am pleased to inform the House of a recent report by the Newcastle and Hunter Film and Television Office which shows that almost $1.1 million has been injected into the Hunter economy by visiting film crews over the past 18 months.

The Hon. Jennifer Gardiner: They are making a police commercial.

The Hon. MICHAEL EGAN: We make a lot of television commercials in Australia. They are not just television commercials for Australia; they are for countries all around the world. We are an attractive location for many reasons. We have an excellent film industry in New South Wales and our costs are cheaper compared with those of other locations around the world. I am also told that we have another attraction: the quality of the light in New South Wales. Since July 2000 564 film and television production people, including units from Japan and the United States of America, have visited the Hunter. In fact, the region has recently attracted its first Indian Bollywood feature film. Bollywood is the Indian equivalent to Hollywood.

The Newcastle and Hunter Film and Television Office report increased interest in the Hunter as an on-site location. Many directors and location managers are particularly impressed with the diversity of landscapes and architecture, which offer a good range of potential film and television locations. Our fabulous locations are clearly catching on: New South Wales recently took out three major awards at the annual locations trade expo in America, beating leading film-making countries such as the United Kingdom, Canada, Japan and the United States. The Hunter enjoys a diverse industrial infrastructure and skills base to accommodate the needs of film and television production. The film industry can use and complement existing local industries and create new employment industries, providing a boost to the local economy.

The Hon. Duncan Gay: Where are they going to get the Morris Oxfords?

The Hon. MICHAEL EGAN: My family used to have a Morris Oxford. Film-related employment opportunities involve everything from film technicians, actors and extras to accommodation, restaurants, caterers and retail outlets as well as tradespeople, animal trainers, and portaloo and generator hire suppliers. It is pleasing to report that the Hunter community has developed a thriving local film culture in recent years. Newcastle is home to the popular Shoot Out Film Festival, where every year makers of short films converge on the city to make a film in 24 hours. The region offers a variety of film and video tuition, provided by the WEA Hunter, Newcastle TAFE and the University of Newcastle. Many talented local actors are represented by a variety of talent agencies, which provide casting assistance for visiting production crews. Feature films made in the Hunter include Bootmen, 15 Amore and Escape from Absalom. I look forward to hearing of many more feature films and television productions taking advantage of the great resources and facilities the Hunter has to offer.

M5 EAST EXHAUST STACK HEALTH IMPACTS

The Hon. IAN COHEN: My question is directed to the Treasurer, representing the Minister for Health. Has the Minister received any notification of complaints about adverse health impacts from the M5 East stack or tunnel? Is the Minister aware that several previously healthy adults who live close to the top of the stack have developed asthma since the tunnel opened? Will the Minister provide details of complaints received? Has any action been undertaken by the health department in response to complaints?

The Hon. Charlie Lynn: Good question.

The Hon. MICHAEL EGAN: I do not know whether it is a good question. I live about 30 metres as the crow flies from the Eastern Distributor stack.

The Hon. Patricia Forsythe: But you are always sick.

The Hon. MICHAEL EGAN: Since the Eastern Distributor has been in full operation my health has improved immeasurably. This is the first year in a number of years that I have not been sick at budget time. I am not suggesting that is a result of the Eastern Distributor stack. The Hon. Charlie Lynn said that it was a good question. I am not sure that it is, but I will refer it to my colleague the Minister for Roads and we will ascertain whether it is a good question. As soon as the Minister has had the opportunity to consider the honourable member's question I am sure he will give the House a detailed and satisfactory reply.

OPERATION FLORIDA LISTENING DEVICES WARRANT

The Hon. GREG PEARCE: Has the Minister for Police to date apologised to two civilians who were erroneously named on a listening devices warrant, along with 112 police officers, in relation to Operation Florida? If not, will he now give an undertaking to the House that he will apologise to the two civilians in question?

The Hon. Amanda Fazio: Point of order: I am not sure whether the Hon. Greg Pearce should be in this Chamber or asking a question because in one of the weekend newspapers he was referred to as the Liberal member for Ryde.

The PRESIDENT: Order! There is no point of order.

The Hon. MICHAEL COSTA: As all members of the House should be aware, as I hope the honourable Dennis Denuto, that there was an inquiry into this matter. I do not intend to add any further to that inquiry.

POLICE MINISTER'S ADVISORY COUNCIL

The Hon. JOHN HATZISTERGOS: My question is