Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

The minister and I have agreed to act as gentlemen and not waste time but actually ask questions and seek answers, and I thank the minister for his agreement to that. Minister, can you inform the Federation Chamber when the decision was made to cut $5.4 billion from the defence budget?

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

Member for Fadden, do you want to do this one by one and, Minister, do you want to answer one by one?

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Mr Deputy Speaker, we could bludgeon ourselves to death for five minutes apiece and achieve nothing or we could actually ask questions and seek answers.

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

Minister, are you happy to answer one question at a time?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Why not ask a series of them and then I will respond to them?

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

I am happy to do that. Minister, the budget reveals cuts of $1.6 billion in equipment acquisitions in the Defence Capability Plan. Can you outline—or, if you cannot, can you take it on notice—what these cuts are, the strategic rationale for those cuts, why those and not others, and what the impact of those cuts will be? Likewise, there is $1.3 billion in cuts from the approved major capital acquisition program. Again, what are the cuts, what was the strategic rationale for those as opposed to others and what will the impact be? There is $400 million that has been taken from ADF housing over the forward estimates. Can you outline exactly where those cuts are coming from and the impact in terms of housing? There is $1.2 billion in cuts from the major capital facilities program. Again, what are these cuts and what impact will these cuts have on personnel?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I will allow a few people to speak first, and then I will make a response.

Amanda Rishworth (Kingston, Australian Labor Party) Share this | Link to this | Hansard source

I have a question to the minister, but I will make a few comments first. The commitment by the government to commit 12 future submarines to be assembled in South Australia is welcome news for my local constituents. I have to commend the former Premier, Mike Rann, and Kevin Foley, the former defence industries minister, for having the foresight to make South Australia a defence state. It is their foresight that has led to a situation where in South Australia we clearly have—I will let the minister and the Federation Chamber know—the capacity to complete this project. As a very proud South Australian I say that there have been a lot of defence projects which have been very successfully delivered in South Australia and that this one will be no exception.

I was also very pleased with the government's recent decision, which was announced in May, to commit $214 million on the first stage of the Future Submarine Project. This was certainly welcome news. There has been discussion about this for a long time, and it was very pleasing for my local electorate to be given the certainty about it from this government. Unfortunately, no such commitment has been made by the opposition. I know it is not the member on the other side; I know he would love to build the submarines in South Australia. Unfortunately, the member for North Sydney and the Leader of the Opposition will not commit to that. That is very concerning and, I think, does put some uncertainty in the project.

From the government's point of view I am pleased to see that there is the commitment for this. It builds on, I note, the 2009 white paper, which outlined the government's commitment to acquire 12 new future submarines to be assembled in South Australia. I am very pleased that that commitment has been forthcoming with the announcement of the first stage. I think that is really important.

The opportunity for South Australia in this project cannot be underestimated. Discussions I have had with the defence industry and with the minister indicate that we are talking about not 10 years or 20 years of investment and economic activity as a result of this project in South Australia but 50 years to 100 years of exciting economic activity.

We have seen with the air warfare destroyer project that certainly South Australia has the capacity in Techport to be able to bring expertise together to deliver on defence projects. In terms of bringing industry together, I think that area in Port Adelaide has really come of age and is ready to deliver. They are very pleased, and, in the conversations that I have had, people have welcomed this commitment by the government.

It is very concerning that the opposition will not commit to this project. It is very concerning that we do not have bipartisan support for it. That fact does cause a lot of uncertainty for people in South Australia and for businesses in South Australia.

Mr Robert interjecting—

I would call on the opposition to look at it very carefully. As I said, I know the member on the other side's commitment. It is a pity that the member for North Sydney and the Leader of the Opposition does not share his commitment to this. It is very concerning. It would be good if the opposition could come on board with us and make it bipartisan. Certainly that is what people in South Australia want. Unfortunately this is symptomatic of the opposition's neglecting South Australia. Whether on water, on defence spending or on Holdens, really what the opposition leader has been clearly saying to South Australians is that he has no interest in them. But back to the issue at hand. My question to the minister is: can the minister update the chamber on the government's commitment to the future submarine capacity?

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

I will call on the member to deal with those questions thus far. I thought we had an outbreak of peace, for a while. But the minister has the call anyway on the questions from the member for Fadden and the member for Kingston.

Honourable members interjecting—

The minister has the call and he will be heard in silence. It is a very important portfolio, and I will ask those in the Federation Chamber to hear the minister's answer in silence.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Let me first go to the general issues which were raised and the specific questions which were raised by the shadow minister. Obviously the decisions were made in the budget process through the ERC process in a timely fashion prior to the budget. As he rightly pointed out, there is $4.45 million worth of savings across the forward estimates, including a contribution of $971 million in 2012-13.

I do want to make a couple of points just so that we understand the nature of these cuts. The contribution will have no adverse effect on operations in Afghanistan, East Timor or the Solomons, and I think that is commonly understood. It will not have any impact on the provision of defence equipment, defence personnel and operations. They will not be adversely affected, as you would expect. There will be no adverse impact on the number of ADF personnel engaged within the services. What we are doing is looking at the impacts of some of the reform—the strategically reform processes—and making sure that the impacts on entitlements to ADF personnel are being minimised. I understand that would be an issue which you will probably raise. I am happy to talk about that in more detail later.

I think I need to make the observation and the point that there has been no fundamental change to our defence budget from a strategic perspective. That is vitally important if we are to understand where we are going here. In 2009-10, the budget for the government for the first time was over $100 million for defence. That was across the forward estimates. In the 2011-12 portfolio additional estimates, the defence budget across the four-year forward estimates period was $103.4 billion. The budget this year is $103.3 billion. This level of funding will maintain Australia's status in the top 15 nations in the world of defence expenditure. We will continue to be the second on the list of military expenditure per capita, with only the United States spending more. So we need to understand that perspective.

The opposition spokesman has asked me about savings through the Defence Capability Plan since the 2009 white paper. I just want to preface this. I do not necessarily want to have a political dialogue which is about animus, but I do still want to make a couple of observations. This is a $5.4 billion save over the forward estimates. It is for a particular reason which is well known to the parliament and the people of Australia: to get us into surplus. We were asked to make a contribution. We are making a contribution, but the significant question—and this is something which I know the opposition spokesperson will take on board, and I would like to think he could tell us what is happening—is: are the opposition committed to these savings? The real question, apart from the dialogue we will have about the capability development plan, is whether or not the opposition are committed to these sort of savings—or are they going to say they are not going to proceed? If they are going to say that, they have got to tell us where the money is coming from. We already know there is a $70 billion black hole. What they need to be able to tell us now is: if they do not want to support these savings measures, where will the money come from? It is a very simple but very important question which needs to be asked. Let me go to the issue of the Defence Capability Plan.

There were 180 capability projects in the 2009-2019 defence capability plan that underpin the 2009 defence white paper. Fewer than 10 projects have been scrapped as a result of revisions the DCP. The vast majority remain in the program today. (Extension of time granted) Since the 2009 white paper, government has approved over 100 first or second pass and other approvals, including studies, risk reduction activities, capability technology demonstrations and project development funding with a total value of nearly $13.5 billion. This includes the first 14 Joint Strike Fighters, 24 naval combat helicopters, over 900 additional G-wagon trucks, seven CH-47F new Chinook helicopters and two more D model Chinooks, military satellite capabilities, counter IED equipment and systems, new 155 millimetre towed artillery systems, and communication equipment. In 2011 the government made a record 49 approvals of capability projects. The previous record was 37, in 2006. The government has also allocated funding for essential new capabilities not envisaged in the 2009 defence white paper, including the new amphibious heavy lift ship HMAS Choules and the interim humanitarian disaster relief ship MSV Skandie Bergen, two additional C17 heavy lift aircraft for a total of six, and 101 more bushmasters with further orders likely. We remain committed through this budget, and this is apparent in the budget papers, to the core capabilities as outlined in the 2009 defence white paper, including 12 future submarines—I will come to those more specifically in a moment—the joint strike fighter and the replacement for the caribou aircraft.

I will respond to my colleague's questions about the submarines. Earlier this month the Prime Minister, the Minister for Defence, and the Minister for Defence Materiel, Jason Clare, announced that the government would provide $214 million—and I am sure this will be supported by the opposition—for the next stage of the future submarine project. The funding will go towards further detailed studies and analysis to inform the government's decision on the design of Australia's next submarine. The future submarine project is the biggest and most complex defence project Australia has ever embarked upon. It means work for hundreds of Australian companies and thousands of Australian workers, including boilermakers, welders, electricians, naval architects, engineers and many more.

I have a question again for the opposition. Are they committed to this project? Are they committed to having these vessels built in Australia? We know that the shadow treasurer on Channel 7 during the week of the budget said that they want to see what the benefit is in building the submarines here in Australia rather than getting cheaper versions from overseas. I think it is quite important that we understand, through this discussion we are having here, what the government is committed to and what the opposition is committed to. We have announced these savings, which are big, but at the same time we have made our commitment to the future development of Australian defence capability—including submarines—very clear. Clearly we want to see them built here in Australia, and we have maintained our commitment all along. I ask the opposition, if they can, to tell us what their position is.

The member asked me about defence housing. I would like him to tell us where that has come from. Are you talking about Defence Housing Australia, not the housing for single people that we are providing on bases—

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Not for single people. The forward estimates for DHA.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Okay. I will come back to you with an answer on that.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Minister, can you spell out the total value of absorbed measures that Defence is being required to take on, apart from the $5.4 billion in cuts?

Can you actually spell out exactly what programs, infrastructure or projects those absorbed measures relate to. As the most recent ASPI Cost of defence notes, the SRP is failing to meet its savings objectives in 2010-11. Could you outline why this is the case—why they are not meeting the requirements for savings. Can you also outline what the projected savings are from the SRP over the remaining life of this program. Where will they come from? Can you continue to guarantee that those savings will be reinvested in Defence. In terms of industry, Minister, has your ministry or your ministerial colleagues consulted industry regarding the latest budget cuts? Has any modelling been done on the impacts of these cuts on the industry's capacity to respond to both the downturn in work and the supposed ramp-up of work in two or three years time?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I will just go to the question of the ASPI paper, which has been referred to by the shadow minister. Let us be very clear: the defence appropriation for 2012-13 is $24.2 billion. In the 2009-10 budget, the government for the first time budgeted over $100 billion for defence across the forward estimates. In this budget, the government has again budgeted over $100 billion for defence across the forward estimates. This includes $21 billion in total capital investment. The level of funding is expected to maintain Australia's status, as I referred to earlier, as number 13 in defence expenditure. I referred also to our per capita contribution, which is second only to the United States. In real dollar terms, we spend far more than any regional neighbour. Also, with the appreciation of the foreign exchange rate, we have been able to purchase the same equipment from overseas for less. Thus, whilst announced savings will be difficult, the defence budget—as you well know—remains at historically high levels. Reprioritisation with defence expenditure has been designed to have minimum impact on the delivery of core defence capabilities.

I note that the opposition seems to support the views expressed in the ASPI paper, which asserts that the government has manifestly placed a higher priority on delivering a surplus than on delivering a stronger Defence Force. It is not an either-or situation. The government remains committed to delivering the core capabilities identified in the 2009 white paper and to delivering one of the most capable defence forces in our region, but global and domestic economic circumstances have changed significantly since that white paper, which I am sure is well understood by the shadow minister but perhaps not so well understood by some of his colleagues.

The effects of the global financial crisis have continued to unfold with unexpected severity and duration since the 2009 defence white paper. In response to this, as we have maintained from the get-go, this government is committed to bringing the budget back to surplus in 2012-13. As was made clear before the budget, Defence had to expect to make a contribution. That contribution has been made. The reprioritisation of defence expenditure has been designed to have a minimum impact on the delivery of core defence capabilities.

Another part of that ASPI report says that clearly it is the government's priority for defence that has fallen rather than its absolute ability to pay. That is simply not the case. The 2009 defence white paper noted that the global financial crisis was the most serious global economic and financial crisis in decades and that its strategic impacts were still unfolding. Since the GFC has continued to have a significant impact on the global economy, following the GFC the defence forces of major developed countries have increased efficiencies and reduced their budgets, including the United States, the United Kingdom and Canada. Of course, the other NATO nations in Western Europe have had significant impacts upon their defence budgets. Australia's 2009 defence white paper was completed before the unfolding of these events and the financial circumstances clearly represent a real challenge to the 2013 white paper. In terms of core capabilities, there are some 180 capability projects in the 2009-10 Defence Capability Plan that underpin the 2009 white paper. As I said previously, the vast majority of these remain, with 10 being removed. Most of those 10 have either had their scope reduced or were subsumed by other, related projects or replaced by newer technologies. I said before our commitments in this budget are for the first 14 Joint Strike Fighters, 24 new Navy helicopters, 900 additional G-Wagen trucks, additional Chinooks, military satellite capabilities, counter-IED equipment assistance, towed artillery systems and, of course, communication equipment. In 2011 the government approved a record 49 capability projects. The previous record was 37 in 2006. (Time expired)

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Stirring speech, Minister; however, the question was: can you spell out precisely the total value of the absorbed measures Defence is being required to take on? The SRP failed to meet its objectives in 2010-11 why? What are the projected savings from the SRP over the remaining life of the program? Will these savings be reinvested into Defence? Have you consulted with industry regarding the cuts? Are you aware of industry's capacity to respond to it?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

The decisions the opposition is requesting have been taken to address changes that have occurred in the department's resources position over the last year which include a range of new cost pressures across the portfolio, including the following priority areas for investment: $700 million for additional investment in Collins-class submarine sustainment, $550 million for information technology remediation activities across Defence, $400 million for improved housing for Australian Defence Force personnel, $330 million for relocation of defence units from Moorebank to Holsworthy to allow development of the intermodal transport hub, $270 million in additional funding for Navy fleet sustainment, $220 million for investment in maintenance and upgrades of the Defence estate, $160 million for fringe benefit tax liabilities, $150 million for enhanced garrison support services and $70 million for further investment and international engagement under the Defence Cooperation Program.

To manage these internal cost pressures Defence has reallocated and reprioritised $2.9 billion. The majority of that $2.9 billion was reallocated from savings in the Defence Capability Plan and the approved major capital investment program, with further savings, predominantly in 2012-13, from across the general department operating budget. These savings from across the general department operating budget include Navy reprioritising its operating activities and reviewing all non-operational activities, including Navy's international program, and Army reducing the use of M113AS4 vehicles and M1A1 Abrams tanks. That some of these vehicles will be placed in temporary storage is well known now. Army will continue to review these fleets to ensure a viable mechanised capability is maintained.

These budget initiatives build on the efficiencies and savings gained through the Strategic Reform Program, including in the areas of capability development, procurement and acquisition, and the strengthening of personnel and institutional capabilities. The reform will be further considered during the development of the 2013 Defence white paper to ensure that, as you would expect, defence spending, in light of the forced posture review, revised Defence Capability Plan and the savings that have already been identified, is calibrated against an up-to-date assessment of our circumstances in both the short and longer terms. It is important that we acknowledge that some hard decisions have been taken in this budget, and we do not shy away from those decisions. I think it is very important also to say that there is no question about us not accepting the need to make changes in the way we do our business, and we are doing that. We have made it very clear that the allocation across the department was being, as I said earlier, reallocated from savings in the Defence Capability Plan and the Approved Major Capital Investment Program with further savings, predominately in 2012-13, from across the general departmental operating budget. It is very clear to us that we have a job to do here to make sure that we operate more efficiently and that we get better outcomes for the dollar we expend, and that has to happen right across the organisation. I do want to commend the organisation for being part of the decision making and for understanding what these responsibilities mean in terms of providing advice to government as to what we might best do to achieve our targets.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

In a place that often focuses on the differences between the parties, I think both sides of the chamber agree on one thing and that is that one of the pre-eminent objectives for us in Afghanistan is the protection of our troops and of their wellbeing in Afghanistan. One of the things that I did want to focus on this morning in my question to the minister is what we are doing to protect troops there. I am led to believe that we have undertaken a number of measures in the course of the last year. There is new lighter combat body armour and a new combat uniform, longer range machine guns and upgrades to the Bushmasters. I understand that in the course of the last year we have let out a contract for the manufacture of over 100 new Bushmasters in Victoria and the upgrades to the ones in Afghanistan are designed to make them even more secure. I also see that we have put in place a counter-rocket system in Tarin Kowt to provide additional protection of troops there. Clearly these measures are critical.

In addition to this, a MultiCam camouflage uniform is being trialled to provide troops with even greater levels of concealment across the various terrains within Afghanistan. Obviously that is critical for them there. The new uniform, with its new elbow and knee pads, is designed to reduce soft tissue injuries. The uniform is cooler, it is designed to be worn under the body armour, and it has a padded waistband to make it even more comfortable under webbing or a field pack. And it has more pockets and stretch fabric at the joints.

I said earlier that the upgrade of the Bushmaster protected mobility vehicles will make them even safer. The upgrade will include the installation of protected weapons stations to reduce the exposure of crew operating vehicle-fitted weapons; internal spall liners that provide vehicle occupants with better protection from direct fire and side blasts; and new seating and flooring, giving troops in the vehicle better protection against spinal and lower limb injuries from the blast effects of IEDs. I want to ask, Minister: is there any other research being undertaken to further build on this commitment in terms of protecting our troops? I am wondering if you can outline that to the chamber.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Thank you for that wonderful question.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

Thank you.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

What nonsense!

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

You think troop protection is nonsense, do you?

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Don't lecture me on troop protection!

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

Order! There will be no cross-chamber discussions. There are questions and answers, and they are all through the chair. That goes for both sides.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Can I just say that the measures you have outlined are in fact all accurate. We have, under Colonel Jason Blaine, Diggerworks—which I am sure the shadow minister is aware of—which is a program designed to ensure that we have got the best possible equipment for our men and women who are on deployment doing the business for us in Afghanistan and elsewhere. It has proven to be a very successful program which has led to changes, which largely you have outlined.

You asked me about further research. There is a partnership between the department generally, the army in particular and the Defence Science and Technology Organisation, for which I am responsible. That sort of work is ongoing. Whilst I am not at liberty to talk about the sorts of developments that have been produced directly as a result of their research into looking after our troops in Afghanistan, you can rest assured that as a result of the work which is being done by DSTO, particular items have been introduced into the theatre which have provided additional protection in terms of electronic countermeasures for our troops. They are very, very important to us. They are doing a huge amount of work along with those over in Russell involved with the IED taskforce, which is looking at how best to exploit the information we receive from IED events; translating that into methods of operation and providing greater protection for our personnel.

I am very proud of the work which is being done across the defence force, including across the department and all its agencies, in doing all we possibly can to provide for the protection of our personnel. You mentioned the Bushmasters; they are a case in point. A lot of the work which has led to the changes in the way we actually provide these vehicles is a result of research which has been done in the first instance through DSTO. It is very important work. Unfortunately, the Defence Science and Technology Organisation is not widely known outside of the defence community; indeed, in some parts of the defence community even then. It is a real treasure for us. It provides enormous capability advantage to us, unrecognised in the wider community—as I say—and is something which we should all applaud. I thank you for your observations about the work we are doing.

I just want to come back to the opposition shadow minister's question on strategic reform. As you know, the strategic reform program was announced as part of the defence white paper in 2009. It is an ambitious reform program that aims to find $20.6 billion in cost reductions across the decade, 2009-2019, for reinvestment in defence capability. We expect to meet our $1.284 billion target for the 2011-12 financial year. This comes on top of our meeting the $797 million target in 2009-10 and the $1.016 billion target in 2010-11.

But I do want to make clear and have it really understood that the SRP is not just a cost reduction program. It is a decade-long program of reform that is driving a greater understanding of defence business. Its cost drivers have started a culture shift in the organisation. Now the SRP is three years old, and the substance underpinning that program of course change and as a result of changes to the defence-funding profile and further detailed examination of proposed reform activities over the intervening years. The SRP, although achieving its targets, does face challenges. When it was agreed, it was the only major reform initiative within defence. Circumstances have evolved dramatically since. The effects of the global financial crisis, as I said earlier, have been a significant driver for us. At the time of the 2011-12 budget it was determined there would be a $1.6 billion underspend for 2010-11 and $1.3 billion of capital funding to be reprogrammed. This represented significant failure in defence's planning and advising process. (Extension of time granted).

In addition, the defence reform agenda has been expanded to include a number of new and important reforms, including the review of the Defence Accountability Framework, the Black review—as a result of that defence is strengthening its personnel and institutional accountability arrangements; expansion of the use of shared services in defence to increase efficiency; the plan to reform ship repair and maintenance, the Rizzo review; the review into Collins class submarines, the Coles review; the Pathway to Cultural Change, which is enhancing defence culture; and a range of important procurement and capability reforms to improve the effectiveness and efficiency of the acquisition of new equipment for the Australian Defence Force have also been implemented. These include reforming defence planning, decision-making processes and performance management; substantially reducing the number of committees in defence; increasing the rigour, contestability and expertise within capability development; and strengthening the Projects of Concern process. We remain committed to the SRP, notwithstanding the $1.9 billion target in 2012-13. We will continue with the strategic reform program activities underway in the lead-up to the 2013 white paper. Defence reform, including how the range of existing reform initiatives will be integrated, will be a major theme of the Defence white paper which was announced by the Prime Minister and Minister for Defence on 3 May. This is something that we are looking at right now. Further details of future strategic reform in defence and how the range of initiatives will be integrated will form part of the 2013 white paper.

I think that adequately deals with the issue of the SRP, and I hope that the opposition understand that we remain committed. I am not sure about you—and that is the question. I go back to what I said originally. We need to understand whether or not the opposition are committed to the savings which we have identified. If not, why not? What are they going to change and how are they going to get the money if they are not? I ask whether or not you are committed to the strategic reform program, as we are, and if not, why not?

I thank my colleague for his question and I say again that we will do all we possibly can to enhance the protection of our troops on overseas operations. That is our first obligation, and it is an obligation which we will continue to meet.

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

Labor slashed $5½ billion from defence in the budget—which, considering Wagga Wagga, in my electorate of the Riverina, is a tri-service defence city, is sure to have a great impact. Twenty Army major capital facility projects have been delayed by up to three years, Minister, including the construction of Kapooka's working accommodation. I understand that general running expenses at the Army recruit training centre at Kapooka have been, as a result, reduced by a quarter. Last year, 4,000 recruits went through the base—2,300 regular soldiers and 1,700 Army reserve. The cutbacks mean such things as the commandant, instead of travelling to other bases for important face-to-face talks with other colonels and military chiefs, is now forced to do this by telephone. Is this satisfactory for a base which is so important to our defence capabilities?

Furthermore, the towns of Tumbarumba, Temora, West Wyalong and Uranquinty, in my Riverina electorate, did not have Australian Defence Force personnel or had reduced catafalque parties at the recent Anzac Day observances. This was due to funding cutbacks. Can you give me a guarantee that these regional towns and others will receive very necessary ADF representation for Anzac Day ceremonies and other important services from 2013 and beyond?

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Minister, the budget indicates that the number of flying hours for both RRH and MRH will be cut. Can you inform the House how much they will be cut by? Are there any other assets, rotary or fixed, that will have flying hours cut over the forward estimates? The Chief of Navy's brief to his commanders and senior sailors indicates that they will be looking at the constrained use of surface vessels because of the reduction in fuel available to those ships. Could the minister outline what is the reduction of fuel to surface vessels and what programs the Chief of Navy will not be conducting because of the lack of fuel the chief has available to him?

Minister, with respect to the mothballing or putting into storage of M1A1 main battle tanks and M113s, what is the impact on the full supply chain in terms of training, core selection, core skills, crew command courses and the like? What impact will that have on the armoured corps, because of the mothballing of those assets?

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

Minister, I want to thank the government for the transfer of further land adjacent to the RAAF base at Amberley to the Queensland government for the Aerospace and Defence Support Centre. This 22.6 hectares of land has been combined with the 143 hectares already owned by the Queensland government. That will see the transfer of aerospace and defence support industries and companies such as Boeing, currently located at the RAAF base, which will make sure that there are thousands of jobs and the viability of that sector. Over the years, the RAAF base at Amberley has seen a dramatic increase in operational capacity and the number of personnel.

I notice that there were cutbacks in the budget and I have questions about that. But 24 Super Hornets are located in the area and they are operated by No. 1 and No. 6 squadrons at the RAAF base at Amberley. The Minister for Defence Materiel was with me on the day that four fighter jets were delivered. We have delivered 24 Super Hornets in the past 20 months. Those Super Hornets are particularly important in air-to-air combat, strike targets on land and sea, suppressing enemy air defence and conducting reconnaissance. I notice we are the first country, other than the United States, to fly the Super Hornet. The C17s are also located at the RAAF base at Amberley and they made a big contribution during our assistance missions to Papua New Guinea, Christchurch and Japan.

I have noticed some media commentary in relation to the cutbacks. My questions relate to the RAAF base at Amberley, particularly the operational capacity of the RAAF base. I know that the government has made a decision to buy the fifth and sixth C17 Globemasters to be based at the RAAF base at Amberley. We welcome that and the military personnel. Ipswich has had military personnel since 1861, when we were not flying planes. I note the cutbacks are mainly in civilian and administrative capacities. Minister, will the cutbacks have any adverse operational impact on the RAAF base at Amberley? Is the government's commitment to the RAAF base at Amberley undiminished? Please update the chamber on the procurement of battlefield airlift aircraft to replace the retired Caribou.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I will start with my colleague's question and come back to the others. Yes, we can guarantee our ongoing support for the base at Ipswich. It is very important to us, as you well understand. There will be no adverse operational impact. We remain committed in the way you described.

In answer to the question on the C27J, in May a media release from the shadow minister for defence, Senator David Johnston, made a series of assertions about the procurement of the C27J Spartan battlefield airlift aircraft. In his media release, Senator Johnston said:

It appears there was no competitive tender process, no rigorous evaluation, and a billion dollar decision has been based on a quick desk top audit.

With great respect to the member for Fadden, this stands in stark contrast to his words in the parliament on Thursday, 10 May:

… available at a very good price and option, may I commend the minister for a quick and sound decision. It is a very good capability. The loss of the Caribou was quite a loss in terms of short take-off and landing. The C-27J will add significant capability to our arsenal.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

It will, and I stand by the comments.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I am pleased you do, but I just want to understand: is that the opposition's position?

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

Order! I reiterate all comments are through the chair.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

With great respect, through you, to him: I am just wanting an assurance from the shadow minister that the views he has expressed are indeed those of the opposition, because they seem to be in contrast to those of the shadow minister for defence. Let me just put a couple of facts on the table. The government agreed to purchase 10 Alenia C-27J Spartan battlefield aircraft to replace the Caribou aircraft which was retired from service in 2009. Some, like me, with a liking for the Caribou, are a bit sad about that. After a career spanning more than four decades—and I would imagine you were actually transported in one on more than one occasion—

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Parachuted out of it.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

And you enjoyed every moment.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Loved it.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Very slow but got you there safely. The C27J complements the capabilities of the C130 and the C17 aircraft and has been widely welcomed by the Air Force. You mentioned the two additional C17s that we are purchasing. A competitive down-selection process to the C27J was made following exhaustive assessment by the Department of Defence and DMO, the Air Force, of information provided by manufacturers of the C27J and the C295 aircraft. An equal and same opportunity was given to Airbus Military and Alenia. The decision to acquire the C27J was made by the National Security Committee of cabinet and on the recommendation of the Department of Defence, the DMO and the Air Force, together with formal advice from central line agencies including Treasury and Finance. The response from Senator Johnston then was that there were merits in both C27 and C295 but at $1.4 billion the C27 would cost the taxpayer more than twice as much as the C295. That is untrue. The cost of the C27J and the C295 aircraft are roughly comparable.

What Senator Johnston fails to understand and acknowledge is that the $1.4 billion includes not only the acquisition cost of the aircraft but also the modifications to the aircraft for equipment needed for specific ADF roles, including initial logistics support, testing and certification. These costs would apply to any aircraft platform chosen, including the C295. Senator Johnston said, 'In the eyes of just about every other air force around the world the C295 is not only considered to be the best value for money but also the most effective battlefield airlifter.' Unfortunately, those are not views shared by the Chief of Air Force or the RAAF, who we take our advice from, not the shadow minister. It shows once again that there is a clear disarray in the opposition on defence policy.

In relation to your questions on the ARH and the MRH, there have been some issues around the flying hours for those aircraft. We have had difficulties with the development process but the ARH is now flying and will be supporting full training tasks almost as we speak. The MRH is still undergoing some issues and it will be a while before it will be—

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

The minister will resume his seat. I call the member for Fadden.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

I will be brief. How many single soldiers, sailors and airmen over the age of 21 will be impacted by the cancelling of the ostensibly one free flight home a year? How much money is the military saving as a result of this change, and what other areas of entitlements is the government looking to cancel for soldiers, sailors and airmen?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I am pleased that the member asked me that question, because it is important that we say very clearly what our policy is. The recreation leave policy for Australian Defence Force members is planned to change from 1 July 2012. The change was proposed to the government by the secretary and the CDF and was announced alongside the 2012-13 budget measures as part of a range of measures considered by defence as part of the Strategic Reform Program. Recreation leave travel was previously provided to single ADF members and consisted of annual Commonwealth funded return travel from the member's posting location to the location of their nominated next of kin. Defence has assessed that the policy is decreasing in relevance in the contemporary ADF and it should come as no surprise that Defence, as it should, continually assesses its personnel policies for relevance and appropriateness in order to implement and fund newer, better or more relevant policies in place of older, more outdated policies that needed review.

Major General Fogarty, head of People and Capability, said on 25 May that, unlike in previous years where single soldiers had to live on base, in the confined barracks environment, many members of the military are now based in communities outside the barracks, and that the benefit has become outdated. He said: 'It has become redundant, and the cost of travel within Australia is a totally different environment today to what it was 40 years ago.' The Chief of Defence Force also stated on 25 May that 'the free airfare for older single people was outdated' and that it was in place when he joined the Army 40 years ago, when salaries were low and airfares were very expensive from such places as Townsville. He said: 'The world has changed since that was introduced. You get cheaper airfares, communications are different and the town is not so isolated anymore.' And, importantly, of course, this measure will have no impact on single members who are posted to remote localities such as Darwin and Cairns, because they will still have an entitlement to remote locality leave travel. There will remain an entitlement of three trips a year for trainees and ADF members under the age of 21 will continue to get the entitlement.

Sometimes we make these decisions, and they are difficult decisions, but they need to be made. In this context it is very clear that we want to continue to continually monitor the entitlements that we provide to our Defence Force members. I am particularly pleased, frankly, that the overall package is such that it attracts such large numbers of people to our defence community. And whilst we have had retention issues previously—that is, people not wanting to leave; retention levels have been very good—we are seeing a bit of a change. I do not expect this particular policy item, this new change, to have any impact on our recruitment of new personnel.

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

The question is that the proposed expenditure be agreed to. Minister?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Sorry, can I just respond to the member for Blair. My apologies for not responding to you earlier. I will get you some more detail about the cost impacts on your community. I suspect they will be minimal. In fact, I got a bit of work done, which we are doing again at the moment, on what the investment has been in defence communities across the country over the last decade. I am trying to get it now for the current financial year, which will help you. When I have it, I will make it available to you. In terms of catafalque parties, that is a matter for the defence forces themselves.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Minister, are there any other areas of entitlements that the government is looking at cutting?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I am not looking at any particular areas of entitlements to cut. I only have a minute to go, and I would be very pleased if you could actually respond to the question I asked of the shadow minister about whether or not the opposition are committed to this $5.4 billion worth of savings. If not, which of those savings will they not proceed with? He has indicated, on his own level, that the leave travel entitlement will not be proceeded with—that is, I think, $15 million over the forward estimates. If that is not being proceeded with, what other measures that we have announced will not be proceeded with? You have an obligation to front the Australian community and tell us precisely what you intend to do in terms of the budget and in terms of these savings which have been proposed. And I am hoping that, in the last minute, you might actually respond by telling us what the opposition's position is.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Minister, good try! Before the 2007 and 2010 elections, the Labor Party guaranteed that defence would have three per cent real growth—guaranteed. The current budget has a 10 per cent decline in real terms. Minister, can you inform the House of what guarantees or promises can be believed at all from this government with respect to defence?

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

Before I call the Minister for Veterans' Affairs, I would like to remind the Federation Chamber that I believe it is the wish of the chamber to consider the next portfolio, which is Veterans' Affairs. If the minister would like to respond on this, then we can—

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I will just respond very quickly. I think it is a bit cute. We hear constantly in the parliament from the Leader of the Opposition and from all the shadow ministers—in a chorus, really—a negative tirade around what government is doing or not doing. They have rubbished the budget. They have a $70 billion black hole, but they cannot tell us, or will not tell us, whether or not they are committed to the $5.4 billion worth of savings in the defence budget. If you are not committed to these savings, you have an obligation to tell the Australian community what it is you are committed to. If you are not committed to these savings which we have identified, what do you intend to do? How will you fill the $70 billion black hole—to which, if you are not committed to these savings, we can add another $5.4 billion? You have an obligation not only to the Australian community but to the Australian Defence Force to tell them what your intention is. What we do know is that there is confusion, because there are different words coming out of the mouths of the shadow minister for defence and the shadow minister for defence science and personnel. I just say to them: get your act together. Ask the shadow Treasurer—although he will have a conflicting view, it is clear. He wants to buy the submarines from overseas, costing Australian workers' jobs.

We are committed in this budget to extending the purchases that we have outlined in terms of our capability development, and we have invested in excess of $200 million for the further development of the submarines, which we want built in Australia—12 of them, to be built in Adelaide. You would think we would hear from the opposition whether they are committed to that process or not. To this point, we have heard nothing apart from confusion and dissembling. Tell us the truth: are you committed to the $5.4 billion worth of savings we are proposing in this budget or not? If not, itemise which of these items you are not prepared to support and tell us where the savings are coming from.

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

I understand that it is the wish of the chamber to consider the Veterans' Affairs section of the portfolio at 11 am. If there are no further questions on the rest of the Defence portfolio, we will now turn to Veterans' Affairs.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

The minister asked what the coalition is committed to, and I am more than happy to respond. We are committed to the fair indexation of DFRDB and DFRB pensions. We took it to the 2010 election. In response to that, we then put a private member's bill in, which of course the Labor Party voted against. Then the Leader of the Opposition, Tony Abbott, recommitted the coalition a number of months ago at the Bendigo RSL to the position that we will index fairly—in the same way the age pension is indexed—the DFRDB and DFRB pensions. You asked what we are committed to, Minister. That is what we are committed to. My question to you, Minister, is: are you committed? You have asked for the coalition to say upfront right now what we are committed to, and I have just told you what we are going to do. We are committed to it. We will do it in the first year of an Abbott government. Minister, are you committed to the fair indexation of DFRDB and DFRB pensions? Will you commit right now in the House, as you have asked the opposition to do—today, now—to index the DFRDB and DFRB pensions in the same way as the age pension, as you led the veteran community to believe that you would do prior to the 2007 election?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I am happy to respond to your question, and I will. You cannot jump from the Defence portfolio, where we are identifying $5.4 billion worth of savings, and come at us when I ask you, 'What are you committed to?' with a measure which is going to cost another $175 million—or, in fact, $6.2 billion over time.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Over how long?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Hang on. Not only are you going to expend this amount of money but you are also saying to me indirectly that you do not support the government's saving measures of $5.4 billion. If you do support them, tell us. Tell the Australian community what you support in defence expenditures.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

I just did.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

All you have said is you do not support the leave travel entitlement. That is all you have said. That leaves another $5.4 billion, and you still have to find the $15 million to pay for it. There is an obligation on the opposition: come clean with the Australian community. Here is the opposition's opportunity to say to us whether or not it supports the government's direction on these savings in the defence budget of $5.4 billion. It is simple: yes or no. And if it does not support them then it should tell us where it is going to get the money from—simple. Not too hard. Very simple. Just do it.

In terms of the military superannuation, let me say to you that the opposition, as we have just heard, have said—and there may be something which they do not quite understand here—that they would index DFRB and DFRDB superannuation payments in the same way as the age pension. Keep that in your mind, Mr Deputy Speaker. The opposition want to equate a superannuation benefit payment for work with an income support. They are trying to equate superannuation—a benefit paid to an employee as a result of their working life—with an income support measure such as the age pension.

Let me go through some detail. Over the 11 years of the previous Howard government, what did they do on the question of the indexation of military superannuation? It is a simple question, and the answer is zero, nought, nothing. They put in place the Podger review to review superannuation. From memory the Podger review gave its report to the then government in March or April of 2007. The government did not release it; they just refused to release the report. They thought, 'Just do the report, give people an idea that we are actually going to try to do something but, in fact, do nothing.'

What we did was proceed to release the review and then go on and do more work, and we have come to the conclusion that it is not appropriate for us to index DFRB and DFRDB superannuation payments and treat them the same as the age pension. We know it is very costly. What is more, the opposition know they cannot afford it. Despite statements by the Leader of the Opposition, by the shadow minister for veterans affairs and by this shadow minister they know it cannot be afforded. Their former finance minister Nick Minchin said very recently that this claim to change indexation was:

… properly rejected by the Howard government, of which I was a member …

  …   …   …

There is no inherent logic to the proposition that a public sector employment-related superannuation payment should be indexed in exactly the same fashion as a means-tested welfare benefit in this case, the age pension.

That was the Howard government's position. So what is the difference? All of a sudden we hear these guys telling us that it is appropriate to equate an employment related superannuation payment to the age pension.

Let me just explain what that might mean. (Extension of time granted) I want to give a few case examples so we can compare what it means to be on a military superannuation through DFRDB. A warrant officer who retired in 2010 after 35 years service is estimated to receive a payment without commutation of approximately $54,000 per year. If he or she decided to commute five times the annual payment—and 99.5 per cent of members have commuted the annual payment—then the lump sum would be around $270,000, in exchange for a reduced annual payment of some $40,000 per year. What we are being asked to do here is equate that superannuation payment to the age pension. Are you serious?

A colonel equivalent who retired in 2010 after 35 years service is estimated to receive a payment without commutation of approximately $78,000 per year. If he or she decided to commute five times the annual payment, then the lump sum would be around $390,000 in exchange for a reduced annual payment of some $59,000 per year. Again, are you serious? Are you seriously expecting us, this government, the community, to equate a superannuation payment of $59,000 per year, indexed to CPI, with the age pension? You might tell me what the logic is here. What is the logic of equating a superannuation payment of $59,000 per year to the age pension?

You know, as I know, that those people whose income falls below the threshold can get access, if they meet the appropriate service requirements, to the service pension at age 60 and to the age pension at age 65. Should any of these people, over time, find that their incomes have dropped or that they have made decisions around their lives which mean that their incomes have dropped, then they will get access to the age pension or the service pension, depending on their individual circumstances. I was not aware of this until recently but, in addition, since 1988, DFRDB members have been entitled to a nine per cent productivity benefit, which is available as a lump sum on retirement. So not only can they do the commutation but they also get a nine per cent lump sum productivity benefit on retirement.

The proposition we have before us from the opposition, being trounced around the country at every RSL conference I go to—

An honourable member interjecting—

It is very serious, and I tell the RSL people that we will not be doing it. I am upfront with them.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

So are we, and we'll be doing it.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

But you are not upfront with the Australian community about how you are going to identify the savings to pay for it or how you are going to identify the savings to pay for the $5.4 billion worth of defence expenditure cuts which we have put into this budget. You have not explained that to us either. You have an obligation, when you go to these meetings, to be straight. The problem is that you are not. People are not silly. They are not going to be confused forever. There will come a day when they will ask you the vital questions and you will not be able to respond to them because you do not have an answer. It is very clear to me that, despite your protestations, in your heart of hearts and indeed, I bet, in the shadow finance minister's heart of hearts, the shadow Treasurer's heart of hearts and, I suspect, in the Leader of the Opposition's heart of hearts, you all agree with Senator Minchin. They agreed with him when they were in the Howard government as members of the cabinet and they agree with him today. Of that I have no doubt. It is just a proposition which is not sustainable.

I say to the opposition: I would think again. The only commitment we have received out of you this morning is a commitment not about what you are going to do about the $5.4 billion worth of defence savings but a commitment—two commitments really—on leave travel entitlements and superannuation indexation for the DFRDB recipients. That is it. I say to you that you need to do a lot more to tell the Australian community about what you intend to do in both the Defence portfolio and the Veterans' Affairs portfolio.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

We have only made one commitment, and that is DFRDB indexation. We have made no comment upon defence travel, Minister. I will just update that for the record. On budget night, the minister made much of the government's $17.4 million package to respond to the findings of the Campbell Review of Military Compensation Arrangements. The review's recommendations were tabled by the minister in the House on Wednesday, 23 May. In that statement the minister indicated that 96 of the 108 recommendations were adopted. What he did not say was that the government has delayed the implementation of the major findings of the review until a later date, principally to save money.

In Senate estimates on Tuesday night, the Department of Veterans' Affairs confirmed that recommendations implementing compensation-offsetting reform and major changes to the review and appeal methodology have been delayed by a government decision not to spend any of the announced funding for a further two years. This means that a returned soldier, sailor or airman, or airwoman, will be forced to wait another two years for the government to implement findings fully endorsed by the ex-service community. Minister, why have these been delayed, why wasn't this announced earlier and what are the implications of this delay?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Further to the issue of superannuation, let me make it clear what the opposition has signed up to: $175 million over the forward estimates; a $1.7 billion fiscal cost over the forward estimates; and $6.2 billion in unfunded liabilities. Those opposite have not seen the connection, or are failing to recognise the connection, between this superannuation scheme and the scheme that other Commonwealth superannuation beneficiaries are on—that is, Commonwealth public servants. If there were to be a change to the indexation in the way in which the opposition subscribes to, as former Senator Minchin pointed out, there will inevitably be a flow-on to all Commonwealth public servants. The costs would be horrendous. It is something that I know the shadow minister for finance and the shadow Treasurer will have deep in their thoughts. This is a commitment that I do not think will be met.

Mr Robert interjecting—

Mate, you have indicated to us that the only observation you have to make about the $5.4 billion saved in Defence is that you have no comment.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

This is consideration in detail of your appropriation bill.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Consideration in detail? The detail I want from you is: do you support them or not?

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Of your appropriation bill.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Do you support them or not? A very good question. He should just answer the question. Let me make some observations about MRCA, which you have just asked about. The opposition is in no position to criticise the government on our commitment to review MRCA, the Military Rehabilitation and Compensation Act, which was a Labor Party 2007 election commitment. We have implemented 96 of the 108 recommendations. It is worth pointing out again that, like on the indexation issue, when the opposition were in government they refused to commit to any review of MRCA to ensure it was meeting the needs of our service men and women. They refused to do it. They did virtually nothing for the veterans community in 11 years of government, and their words are not backed up. Now, I am afraid, they are simply playing the politics of it.

Going to recommendation 22.2(a) on multiple-act compensation, this new methodology will apply to all future decisions on and from 1 July 2013. The majority of the veterans affected by the methodology will benefit financially from the new methodology being applied rather than the current one. Any veteran to whom the current methodology applies between now and 1 July 2013 may still benefit from the new methodology when their case is reviewed. The retrospective reviews will commence six months after 1 July 2013—that is, from January 2014. No-one will be disadvantaged by the reviews. Indeed, the majority are expected to benefit by a retrospective adjustment to their compensation for the MRCA accepted conditions. Where the new methodologies apply retrospectively and produce a lower outcome, the current methodology, the existing MRCA compensation, will continue.

The reviews will begin with the oldest case first. All cases since 1 July 2004 that have had the current methodology applied will be reviewed. DVA will identify the cases and actively review them. There will not be any need for the veteran to request a review. The number of retrospective reviews required to be done will not increase after 1 July 2013, because the new methodologies apply to new decisions from that date. As of 1 July 2013, there will be about 1,600 to 1,800 decisions to be reviewed. Many of these reviews, as one would expect, will be complex—they will involve multiple assessments dating to 1 July 2004. Each assessment will have to be recalculated using the new methodology, and it is expected that it will take 2½ years to review all cases. It is not expected that there will be any need for additional medical reviews to allow the new methodology to be applied. The government provided funding to DVA for the conduct of these assessments.

You have asked about the delays in implementation. I make it clear that considerable preparatory work is necessary before DVA can implement the accepted recommendations with an implementation date of 1 July 2013 or later. For some initiatives, system changes are required. There are 20 recommendations that require legislative amendment, instruments and determinations. Implementation of the 53 recommendations involving improvements to benefits systems or processes is a substantial body of work for the department.

On the issue of the single pathway through VRB, recommendations 17.1 and 17.2, the delay in implementation to 1 July 2014—another question that was asked by the shadow minister that was made clear in Senate estimates; I am not quite sure why you are asking the same question again—is to allow sufficient time for the detailed implications of the initiative to be worked through in consultation with all the stakeholders, including ex-service organisations, the legal profession, the Veterans' Review Board, the Administrative Appeals Tribunal and others. The government has asked that further work be done and presented back to government in the 2014 budget, with a view to implementation from 1 July 2014. This is a significant and complex change associated with the appeals process. It is very important that enough time be allowed for consideration of all the issues so that the best possible process is available to those who need to have a primary decision review.

In its report the review identified a number of issues associated with the initiative that need to be resolved before implementation. It did not provide a solution to these issues. This work now needs to be done. It would not have been sensible to begin work until the government had made a decision in the 2012 budget to support recommendations 17.1 and 17.2. Do you want me to proceed with the advocacy model?

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

It is already on the table at Senate estimates?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Yes, most of it is there, mate. That is why I am wondering why you are asking questions.

Tony Zappia (Makin, Australian Labor Party) Share this | Link to this | Hansard source

The defence sector is vital to South Australia, and it is particularly important to my electorate. The RAAF base is located just outside my electorate, so many RAAF personnel live within the electorate. Within my electorate there is also the Defence Teaming Centre, located at Mawson Lakes, where anywhere between 50 and 100 small businesses operate in conjunction with defence contracts that have been won—

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Mr Deputy Speaker, I rise on a point of order on relevance: this has now moved on to Veterans' Affairs. It is not a standing defence matter.

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

I am listening to the question. I ask the member to make it relevant to Veterans' Affairs, but I believe we are discussing the portfolio under the banner of Defence.

Tony Zappia (Makin, Australian Labor Party) Share this | Link to this | Hansard source

I would have thought that, whether it is Veterans' Affairs or Defence, the two matters are related. How you can separate the two is—

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Mr Deputy Speaker, a point of order on relevance: the appropriation bills have a separate appropriation line for Veterans' Affairs. Under the Federation Chamber list, Veterans' Affairs is a separate line.

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

I am aware of that. I am listening to the member for Makin.

Tony Zappia (Makin, Australian Labor Party) Share this | Link to this | Hansard source

As I was saying, the defence sector is absolutely vital to my part of the world. I am conscious that there are many industries, including the Techport operations, where the submarines are being built and where a number of Defence personnel are located and work. Over the last couple of years I have had many representations made by veterans and by those officers who have been deployed from Darwin to the RAAF base as part of the new battalion.

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

I ask the member for Makin to bring his point back to Veterans' Affairs. We are discussing Veterans' Affairs.

Tony Zappia (Makin, Australian Labor Party) Share this | Link to this | Hansard source

My question to the minister is: in respect of those soldiers who have been relocated to the RAAF base, can you advise what steps are being taken to ensure that their families are being supported with the relocation and, in particular, what—

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

Order! The Member for Makin will resume his seat. The Member for Fadden on another point of order.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Mr Deputy Speaker, this an egregious abuse of appropriation—

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

The member for Makin is talking about the families of those employees—

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

Who are not veterans, Mr Deputy Speaker.

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

The member for Fadden will resume his seat.

Tony Zappia (Makin, Australian Labor Party) Share this | Link to this | Hansard source

I will finish on this point, Mr Deputy Speaker. In some cases those members will remain in South Australia once they leave the Defence Force, so it is of interest to them to understand what support measures are in place with their relocation.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I am happy to respond to the member for Makin's question as it goes to the services we are providing on base for current serving veterans, including the veterans on bases in his community, and the continuum of care and the transitional pathway from the defence community to the veterans community, from uniform to out of uniform and into civilian life. And it is fair to ask the question because it is a very important part of what we are doing. I suggest to the shadow minister, if he is not aware of it—

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

We are, and we support it.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

Thank you. To inform the member for Makin, we have 35 on-base advisory service officers across the country. They are there to provide assistance to men and women in uniform who are currently serving personnel on what we can do for them: what their entitlements are; what they need to do if they are proposing to leave the Defence Force. We are also acutely aware of those people who have been wounded or are ill as a result of action or their service. We are most particularly aware of those people in rehabilitation and what we need to do to make sure that we maintain the requirements for them post their service life. This is all happening on bases around the country.

It is vitally important to the future of the Australian Defence community—to men and women in uniform—that we look after them not only while they are serving our nation overseas, but also when they come home and when they decide to relocate out of the Defence Force. I did some work on this and it is something that I think the shadow minister would be interested in; it is something I have been talking about at RSL conferences around the country. One of the issues for us is to make sure that we are not only supporting serving men and women and their families—which we are bound to do—but also to make sure that we look after those people who retire out of the Defence Force or move on or transition out. But we need to understand who they are.

You get the impression on some occasions that these people join up when they are 19 and stay for life—and of course that is not the case. The median age of the vast bulk of those people who enlist in the Australian Defence Force is around 20; the median age of them leaving the Defence Force is 27. These are not people who have DFRDB or any entitlement to superannuation; these are people in uniform who, the bulk of them, are leaving the Australian Defence Force by the time they are 27. They are the people I am most concerned about.

I know if you are in the Defence Force until you are 45 or 50 or 55, you are being looked after and your family is being looked after. But if you are a member of the Defence Force and you retire out of the Defence Force after two or three tours in Afghanistan, at age 25 or 26 or 27 or 28, then there is a real chance that you might disappear from us. We need to try to inculcate in these serving members the need to stay connected through the Defence Force associations and ex-service organisations such as the RSL so that we can make sure, should something go awry somewhere down the track, that we are looking after them. That is our commitment. I know it is a commitment that is shared by the opposition. Despite the differences we have, and I say this while the shadow minister for veterans' affairs adviser is here—he's a good bloke; he's all right—over issues such as DFRDB and DFRDB superannuation, we are aligned in making sure that we are supporting our veterans and our veterans' community. In conclusion, what I am concerned about is whether or not you support us, whether or not you support the government's proposed savings in this budget. At some time I expect you to tell us.

Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

The budget finally delivers a funding blueprint for the centenary of Anzac. Whilst it is a long time coming, the government response to one particular initiative is of deep and growing concern. On 18 April the Prime Minister announced $6.5 million for the construction of the Anzac Interpretive Centre to ensure the new centre was up and running by November 2014. The Anzac centre is fully supported by the coalition and, I gather, by the government.

We are concerned the City of Albany has major reservations about the construction of the centre. In its council meeting of 15 May this year it passed a resolution calling for funding security. The council's minutes state that presently the cost estimates for the planning, design and construction of the centre, based on the scoping advice of consultants, is potentially $9 million plus. To date the only confirmed funding for the project is $6.55 million, leaving $5.8 million for construction. A quantity surveyor has estimated the cost of construction at $8 million. The council advises that the construction of this building, from a project management perspective, is a risk. The government funding appears to be $2 million short of what is needed for the Prime Minister's 18 April 2012 commitment to be sustained. We also learned on Tuesday night that the scoping study into the project is yet to be completed and the government's final commitment is based on an old estimate of construction costs. Minister, can you give the community of Albany any commitment that the city will not be left saddled with the cost of completing the Anzac Interpretive Centre?

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

This is an issue which we are aware of, but our additional provision in the budget was based on the initial costings that were put forward to us. There is no additional money we can provide. The Albany community and the Western Australian government need to look at how they might get additional funding for the project.

Proposed expenditure agreed to.

Attorney-General's Portfolio

Proposed expenditure, $3,676,998,000

Michael Keenan (Stirling, Liberal Party, Shadow Minister for Justice, Customs and Border Protection) Share this | Link to this | Hansard source

I look forward to taking this hour to quiz the Attorney-General and the Minister for Home Affairs on issues within the portfolio. I want to start on an issue that we have just been discussing in the main chamber, which is the 20th anniversary of the Mabo decision by the High Court. Given the Attorney's words in support of native title today, and given the significance of this anniversary, I am wondering how she can reconcile that with what the government has done in relation to refusing to fulfil the Commonwealth's obligation to fund 75 per cent of all native title compensation settlements. In my home state of Western Australia this is a very significant issue, as it would be for other state governments as well. It really is an enormous betrayal of Indigenous people all around the country. In light of this anniversary and in light of her stated support for native title, I am wondering how she can possibly reconcile this position.

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

I was going to ask a fairly similar question in relation to native title. I have a large Indigenous community in my electorate, in Ipswich and the Somerset region. In fact I have an Indigenous school, Hymba Yumba, a new prep to year 12 school. I was down there fairly recently talking about how it could develop. I was also visiting the USQ Indigenous Connections 2012 event for high school kids which took place in Indigenous communities across the whole of the western corridor, through Ipswich and the Somerset region and out towards Toowoomba. That was a good way for young Aboriginal and Torres Strait Islander people to get pathways to undergraduate degrees. It was great talking to the young people there and seeing what their future goals and aspirations were.

Recently, on 2 March 2012, I addressed the Indigenous Lawyers Association of Queensland on where the government was at and how they could assist by mentoring young Indigenous people across Queensland. I know the president of that association, Josh Creamer. There was a profile of him in the Courier-Mail and he talked about the tabling of the Doing time report of the House of Representatives Standing Committee on Aboriginal and Torres Strait Islander Affairs, which I chair. He works in native title and Josh and I have talked about this issue on a number of occasions. He talks about the challenges in relation to native title. Minister, I would like to ask a question in relation to this. I understand that back in 2008 it was estimated that, given the rate of resolution, it would take about 30 years to resolve the current and anticipated native title claims. In about 2009 I think the government made a number of reforms to actually promote a speedy resolution of those types of cases. I understand that in the budget there were some announcements in relation to institutional reform to further enhance the effectiveness and efficiency of the judicial system, particularly native title claims. Can you provide information about that particular measure, the anticipated impact and the resolution of those claims? I am happy to relate that back to Josh and his organisation in Queensland.

Nicola Roxon (Gellibrand, Australian Labor Party, Attorney-General) Share this | Link to this | Hansard source

I thank both members for those questions, and the member for Stirling's indulgence. I did understand the member for Blair was asking a question on a similar topic and thought it might be easiest to take both of them together. Absolutely, the government is confident that it can fully reconcile its support and recognition for the 20-year anniversary which comes this Sunday in celebration of the High Court decision in the Mabo case and then, of course, the Labor government's action to introduce the native title system—mind you we met with enormous opposition from those opposite. I did think that the very brief and fairly churlish comments in the House today indicated that some in the opposition still have an antipathy to native title. That is a shame, when 20 years on we can see that the system is working quite well.

What I think the member opposite is not recognising, and the question the member for Blair asked started to highlight, is that the government has made a decision in this budget which does provide some administrative savings by moving the Native Title Tribunal back into the Federal Court—keeping its own identity but being able to share all of its administrative backroom functions. That amount of money has been invested many, many times over in other Indigenous programs, which are also in this budget but which I have not yet been asked about—for example, the night patrols that are occurring across many communities in the Territory, and the investments in other justice programs which apply across all the country. The reason that this decision was taken is that we had a recommendation from the Skehill review looking at a range of matters in our courts. We had many, many representations from those involved in the native title system, and we have clear evidence in front of us that this system is working. We know how long it would take if we kept on the same trajectory that we were on—with the Native Title Tribunal itself estimating that the current cases could take at least another 30 years to be completed.

Some of the first steps that the previous attorney took have started to bear fruit. For example, in the 16-year period from when the Native Title Act came into force until the end of 2009-10, the Federal Court handed down 86 consent determinations. In just the year-and-a-half following some changes that our government introduced, 43 consent determinations were handed down. Even though this is early in the process, that is a rate five times higher than prior to the reforms that we instituted through the Native Title Amendment Act 2009. These decisions in the budget simply take that a step further. The 2009 amendments allowed the Federal Court to play a much more active role in the speedy determination of matters. This now will be able to be—

Michael Keenan (Stirling, Liberal Party, Shadow Minister for Justice, Customs and Border Protection) Share this | Link to this | Hansard source

Mr Deputy Speaker, I rise on a point of order on relevance. I am waiting to get a response from the Attorney-General to my actual question. She is over three minutes into her five-minute allocated time. I specifically did not ask about native title in general.

Andrew Leigh (Fraser, Australian Labor Party) Share this | Link to this | Hansard source

There is no point of order. The member for Stirling will resume his seat. This is consideration in detail; this is not questions without notice or questions on notice. The Attorney-General must speak to expenditure within the Attorney-General's portfolio. The Attorney-General is doing that.

Nicola Roxon (Gellibrand, Australian Labor Party, Attorney-General) Share this | Link to this | Hansard source

And I am also addressing the actual budget initiative to which your question went, which was changes to the native title system. I am also going to the member for Blair's question, which I believe I am also entitled to answer. Those changes go directly to the system. If the member wants to ask questions on behalf of his Western Australian colleagues about matters that, 20 years ago, were put by a previous Labor government and rejected by a previous Liberal government, then so be it. Put those questions in question time. They are not a matter for the budget. They are rehashing and revisiting and trying to rewrite history. You need to go back and talk to the previous premier, Premier Court, about why he rejected those offers.

What is before us at the moment in this budget is a strengthening of the native title system and an ability for us to speed up determinations for the benefit of both native title claimants and those who have interests in using the land in other ways. The government is very proud to be able to recognise this anniversary and improve the system of native title.

Michael Keenan (Stirling, Liberal Party, Shadow Minister for Justice, Customs and Border Protection) Share this | Link to this | Hansard source

The nature of that response really was Orwellian. How the government, in what is the greatest betrayal of Indigenous Australians since the Mabo decision was made 20 years ago, can somehow spin that as being an advancement in native title is, quite frankly, Orwellian. We will move on though to other issues within the portfolio.

I wanted to ask about the recent interceptions at Cocos Island of illegal boat arrivals, one on 15 May and then another yesterday on 30 May. As members would be aware, there is a limited Border Protection Command presence at Cocos Island, and I understand that these interceptions were made by a single AFP officer. The boats were respectively carrying 63 passengers in the first arrival and 40 passengers in the second arrival. I wanted to confirm when and how the AFP officers became aware of these particular illegal arrivals. Why was the AFP forced to undertake this task and not Border Protection Command, as is obviously appropriate? What risk assessment has been done for illegal arrivals coming to Cocos Island, both for the Australian officers involved and for the asylum seekers themselves?

I assume this will be to the Minister for Home Affairs. I am not sure how you will be organising it. I wanted to ask whether he believes it is acceptable that the protection of Australian borders relies on a single AFP officer in a rigid inflatable boat, a RIB. Because this has happened on more than one occasion, I wanted to ask him how it was possible for two illegal boat arrivals to essentially just bump into Australian territory before being detected. What provisions have been made on Cocos Island for these continued illegal arrivals, including simple contingencies such as food, accommodation and other needs? Where are the people being detained on Cocos Island and in what conditions are they being detained? Given that these two arrivals have come within the space of a fortnight and there have been reports of an upsurge in Tamil asylum seekers coming from Sri Lanka, what is the government doing in response to increase our border protection system at Cocos Island?

Jason Clare (Blaxland, Australian Labor Party, Minister for Home Affairs ) Share this | Link to this | Hansard source

I have some information for the member. If there is any additional information that he would like, I am happy to take that on notice and provide additional information. Just as was the case under the Howard government, boat arrivals at Cocos Island are rare. As was the case under the Howard government, the Australian Federal Police have responsibilities in relation to maritime patrol at Cocos Island, which is why they responded to this recent arrival.

Appearing before estimates last week, the Commissioner of the Australian Federal Police said that AFP officers on Cocos Island had a responsibility to assist where they can and were trusted to make operational judgments. The AFP used that judgment and responded using rigid-hulled inflatable boats. The shadow minister made reference to rigid-hulled inflatable boats. I should make the point—it is an important point—that they are the same type of boat that was recommended in the WA coroner's recent report for use at Christmas Island. It is one recommendation that we have accepted and will implement. I think it is one that is supported by the shadow minister and by the shadow minister for immigration. I have had conversations with the shadow minister for immigration about that matter specifically. The AFP provides health and safety information and training to its employees. It provides AFP members with an understanding of potential health effects and the skills and knowledge that enable them to work safely. The Indian Ocean Territories Health Service services the community of Cocos (Keeling) Islands and is responsible for initial screening of irregular maritime arrivals. Border Protection Command provides services such as transferring IMAs from the jetty to Cocos airport for quarantine and health screening. Customs and Border Protection is working with the Department of Immigration and Citizenship on arrangements to transfer the irregular maritime arrivals to Christmas Island, where they will undergo initial security and identity checks and their reason for travel will be established.

The shadow minister complained that this has happened more than once. I know that in his press release yesterday he said that it is disgraceful that this situation has been allowed to happen more than once. I should inform him that it happened more than once under the Howard government; it happened twice under the Howard government within a short period of time, so he should reflect upon that when making remarks like that. The Australian Federal Police had responsibility then at Cocos (Keeling) Island, as they do now.

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

My question is also to the Minister for Justice. As the minister would be aware, I am the chair of the Parliamentary Joint Committee on Law Enforcement. Since 2009 the committee has been very interested in the application of unexplained wealth as a technique for targeting serious and organised crime. Unexplained wealth represents a relatively new form of criminal asset confiscation where serious and organised criminals who cannot account for their wealth could be held liable to forfeit it. The value of unexplained wealth provisions lies in its ability to undermine the business model of serious and organised crime. The effect is that it removes incentive for participation and puts in doubt the profits that could be otherwise recommitted into furthering other criminal endeavour.

Minister, my committee was very encouraged in 2009 after conducting an international review of unexplained wealth and made recommendations to the government which were agreed to. The Proceeds of Crime Act of 2002 was subsequently amended. But during the bill's rather tortuous passage through the parliament it was so amended that the resulting piece of legislation providing for unexplained wealth became, in our opinion, seriously unworkable—unworkable certainly to the extent of law enforcement. With these provisions being established, which was very much at the vanguard of attacking serious and organised crime, not one prosecution has been mounted since the passage of this legislation. My committee has more recently conducted a review of the legislation, which I know you are aware of. For the purpose of these proceedings, I would like you to explain why you believe it is absolutely essential that we have national unexplained wealth laws and how you see that combating serious and organised crime.

Jason Clare (Blaxland, Australian Labor Party, Minister for Home Affairs ) Share this | Link to this | Hansard source

I thank the member for Fowler for the question and for his excellent report. The work that he and his committee did in the area of unexplained wealth is very important, and if we can get the support of the states and territories for some of the recommendations in that report to create a national unexplained wealth regime then its impact will be very significant. It will mean that we will seize more money off criminals, which will mean more money in the Proceeds of Crime Fund, which ultimately means more money for the budget, which is a good thing. As the member rightly points out, in March his committee released its report into its inquiry into Commonwealth unexplained wealth legislation and arrangements. It recommended a national approach to unexplained wealth laws to make it more effective than the current regime. That ultimately would require the referral of powers from state and territory jurisdictions. By way of background, the federal government enacted its own unexplained wealth legislation in 2010. Some states and territories—WA, Northern Territory, New South Wales, Queensland and South Australia—also have unexplained wealth laws. As the committee's report points out, there are significant differences and limitations in the way the state laws operate. There are also significant constitutional limitations on what the Commonwealth laws can achieve. They can only be used for offences against the Commonwealth. I agree—and I know that the Attorney-General agrees—that there are improvements that can be made in this area.

That is why we have written to the states and territories asking them to refer us the constitutional powers we need to enact the national unexplained wealth laws. We did that in April. In April we raised the issue with the attorneys general across the nation, and we are looking forward to receiving a positive response from the states and territories to this request.

The advice from law enforcement and the findings of the parliamentary committee that the member chaired are clear: strong national unexplained wealth laws are a powerful way of attacking organised crime. National laws will help the federal government and the states and territories. National laws would give organised crime nowhere to hide their assets. Why is this important? It is important, as the member knows, because organised crime is ultimately driven by money, and because it costs the Australian economy more than $15 billion a year. Take away their profits and it reduces the incentive to commit crime. Organised criminals are more afraid of having their wealth seized than they are of spending time in jail. That is why we need these powerful unexplained wealth laws.

Another reason for these new laws is that it makes it easier for law enforcement to seize the assets of criminals. It effectively reverses the onus of proof. It means that people have to prove their wealth was obtained through legitimate sources rather than law enforcement being forced to prove that it was not. Over the past two years we have more than doubled the value of the assets seized, from about $18 million to more than $40 million. So far this year we have almost doubled it again, seizing $75 million. We are taking mansions, Lamborghinis, Ferraris, yachts and so forth, which takes away the incentive for criminals to commit crimes. Just like in the story of Al Capone, you can catch criminals by following the money.

The national laws that the member is talking about will help the federal government and all states and territories to crack down on serious organised crime. It means the Mr Bigs have to prove their wealth was obtained legally, which makes it easier to confiscate their assets. This makes it one of the most effective ways to tackle organised crime. That is why we will be pursuing this issue with the states and territories with a view to creating national laws. To tackle organised crime we have to hit criminals on the street and at the border, but we also have to do it at the hip pocket. These new laws will help to hit criminals where it really hurts—in their hip pocket.

Michael Keenan (Stirling, Liberal Party, Shadow Minister for Justice, Customs and Border Protection) Share this | Link to this | Hansard source

This question will also be to the Minister for Home Affairs. It is in relation to cargo screening. In relation to the budget cuts, from previous budgets, of $58.1 million and the fact that air cargo is going to increase by almost 45 per cent over the forward estimates in this budget, I am wondering if the minister can inform the House what percentage of air and sea cargo is screened and what percentage is physically examined. Has the reduction in air cargo screening resulted in more illegal contraband being smuggled undetected through customs? Referring to the Attorney's media statement this morning on tobacco smuggling, will the minister be able to outline whether this measure will come with additional funding for Customs to screen cargo so they can stop illegal tobacco being smuggled through our borders?

Given that on 14 March a report from the New South Wales Police on the investigation into weapons smuggling undertaken by a criminal syndicate through the Sylvania Waters Post Office highlighted that 220 Glock pistols had been illegally imported into our country by the air mail undetected by Customs, can the minister explain how and why weapons components were able to be imported into Australia in this case and evade the detection of Customs? Can the minister also confirm whether the $4½ million in funding that the government has committed to Task Force Polaris is additional funding, or are the agencies involved expected to find this money in their existing budgets? If that is additional funding, could he point out where in the budget that funding is to be found?

Jason Clare (Blaxland, Australian Labor Party, Minister for Home Affairs ) Share this | Link to this | Hansard source

I thank the member for his question. I might do it in reverse order. The $4½ million for Polaris is money that has been already allocated to Polaris through the proceeds of crime fund. It is money that was allocated before I became the Minister for Home Affairs. In relation to the weapons that were seized in March, this question gives me the opportunity to provide the member with some additional information which I am sure he is not currently aware of. He would not be aware that in July and in August of last year, Customs seized a number of Glock parts and magazines. The person that was importing those weapon parts had an authorisation for an import permit given to them by the New South Wales police. Customs advised the New South Wales police and they subsequently cancelled the authorisation. Customs and the police then executed search warrants and arrested the man and the matter is now before the courts. I cannot provide to the House additional information on this at this time because it is before the courts, but I ask the shadow minister to reflect very seriously and very carefully on the information that I have just provided.

In relation to the seizure of firearms on 12 April by the New South Wales police, I have got some more information which may be of interest to the House. When they seized the weapons they found information at the scenes in Port Macquarie and in Sydney that indicated that firearms had been illegally imported. The police then provided this information to Customs. Customs have examined the documents and they have advised me that the weapons linked to these documents were indeed illegally imported. These were AR15 semi-automatic military style rifles. The advice of Customs is that indeed the weapons that were linked to these documents were illegally imported. They were illegally imported under the Howard government. So it is to put that information into perspective when understanding this issue. This was at a time when 100 per cent of international mail was X-rayed. It shows the limitations of X-raying. In both these cases of the Glocks and military rifles, X-raying was done. That is why I have said that finding metal gun parts in a box of metal machinery is very difficult. You need to know what you are looking for. That is why I asked for advice from law enforcement agencies. Their advice was that intelligence is the key to seizing drugs or to seizing guns. That is proven by the facts.

The shadow minister asked me about air cargo. I have got for him the following information that he might find instructive. In 2007, the last year of the Howard government, Customs inspected six million air parcels and detected 870 parcels that contained drugs or other prohibited items. In 2011, Customs inspected 1½ million parcels and, by using profiling and intelligence to target the right parcels, they seized 1,741 parcels containing drugs or other prohibited items. In other words, Customs are now seizing double what they were in air cargo under the Howard government. They are seizing double the amount of illegal goods that they were when the member was in government, and that is because of the use of intelligence and targeting. The more intelligence that law enforcement agencies have the more drugs and the more guns they seize, whether it is on the street or at the border. That is why I then asked officials that report to me whether in the budget we should be increasing investment in screening, as the shadow minister proposes, or investing in intelligence. They all said we should be investing in intelligence. That is why I have established an intelligence and targeting team inside Customs, because that is the way to seize guns. It is the same model that we have applied to drugs and it comes with a Customs officer who is now embedded inside the New South Wales Police Force, and the advice to me is that is a model that we should be implementing, not just there but across the country. It is about information sharing and agencies working more closely together. It is also why in the budget you see money allocated to a forensics facility for the Australian Federal Police. That will get involved in things like firearm tracing and so forth. The approach that I have taken here is to listen to the facts and listen to the experts, and I encourage the shadow minister to do the same.

Nicola Roxon (Gellibrand, Australian Labor Party, Attorney-General) Share this | Link to this | Hansard source

I want to briefly address the question that was directed to me on the changes to the penalties for tobacco smuggling. We are, of course, concerned when any illicit product is coming across our borders. I need to put on the record that we do not share the view that the tobacco industry has that this is a huge problem in Australia, but any amount of illegal product coming in is obviously a concern. It is a concern both on the health front because people smoke this product and because it is essentially defrauding Australian taxpayers of money that would otherwise be paid as excise to the government and be provided for in the budget.

These offences have not had their penalties updated for a long time. They are not commensurate with other offences of fraud against the Commonwealth. That is why the announcement has been made today, on World No Tobacco Day. The question went directly to whether or not there are any additional resources being provided. No, there are not for this particular initiative. The same work that is done in detecting illicit tobacco will continue but we will be able to enforce a much stricter regime and harsher penalties, including that those involved in this illicit trade could end up in jail for up to 10 years. It is about having a proper disincentive and us tackling tobacco across all fronts.

Michael Keenan (Stirling, Liberal Party, Shadow Minister for Justice, Customs and Border Protection) Share this | Link to this | Hansard source

I will be very brief; I just want to follow up on what the Attorney was saying in relation to tobacco smuggling. I have been through Customs warehouses and they all smell of tobacco as you go through. There was mention of the report that had been prepared. It was paid for by the tobacco industry but it was done by an independent body. If the Attorney does not believe the scope of the activity as outlined within that report then would she care to outline to the House how serious she believes this problem is. How serious is this crime in Australia and what are the costs to the Australian community? If they do differ from what is contained in that report, could she let us know how.

Nicola Roxon (Gellibrand, Australian Labor Party, Attorney-General) Share this | Link to this | Hansard source

Certainly, I am happy to provide that. I do not have the table in front of me, but I can provide the details that have been made public in the past—and we are happy to make them public—of Customs seizures. They do continue to identify tobacco that is being brought illegally into Australia and we, of course, prosecute people for doing that. The changes that have been announced go to what penalties apply when that happens.

There has been a longstanding dispute between the industry and the government about the extent of this problem. It may well be a dispute that is inevitably going to continue. By its nature, illicit trade means that you cannot always perfectly measure how much is being brought in, but we have a range of different things for measuring it. We have Customs material and household drug surveys. All of them show a far smaller incidence of this than the tobacco industry's own reports. I have said on the record many times before, and I am not ashamed to say it again, that the tobacco industry do not have a good record when it comes to the way they use data and research. In fact, they have a shameful record. So it is fair enough, I think, for me, the government and the public to take with a grain of salt this sort of data that they rely on.

Nevertheless, this change that was announced today, which does not have a separate provision in the budget, is something that the tobacco industry themselves have been calling for. It is in their interests and in the Commonwealth's interests to make sure that, if tobacco is going to be bought and consumed in Australia, the proper taxes are paid and that the proper health warnings are in place. Our government is determined to do everything it can to reduce the number of people who want to participate in that activity.

Melissa Parke (Fremantle, Australian Labor Party) Share this | Link to this | Hansard source

We know that Australia is, generally speaking, a wonderful place for most children. But—while the majority of kids who are lucky enough to grow up in Australia benefit from the high quality of our health and education systems and from the opportunities that exist in a free, safe and democratic society—it must be acknowledged that kids within certain demographics face very different prospects indeed. It is in recognition of that fact that I join with UNICEF and the Australian children's coalition of organisations in welcoming the government's announcement of the establishment of a National Children's Commissioner.

As the chair of the UNICEF parliamentary association, this gives me particular satisfaction and I was glad to move a successful motion at the ALP national conference last year on this issue, while noting that the establishment of a National Children's Commissioner has been a longstanding commitment of the Labor Party and the Attorney-General herself. In addition, as a former UN staff member, someone with a keen interest in human rights and a member of the newly established Joint Committee on Human Rights, it is wonderful to see the establishment of a National Children's Commissioner, which responds to the specific recommendation of the UN Committee on the Rights of the Child that a national human rights institution include within its structure an identifiable commissioner specifically for children's rights. The creation of a National Children's Commissioner is not before time, and it is vital to driving efforts to establish a level playing field for all Australia's children.

To give you an idea of the challenges and obstacles that our most vulnerable children face, I refer to the Listen to children report published by the Australian Child Rights Taskforce last year. It found, for instance, that if you were born into an Aboriginal or Torres Strait Islander family you were three times more likely than other Australians to die before reaching adulthood. You are also 24 times more likely to be in jail before you turn 17 and almost 10 times more likely to be in out-of-home care. It found that, of the 105,000 homeless people in Australia, 50,000 are under the age of 24, and our out-of-home care system established to look after our most vulnerable children is not in good repair. Children in out-of-home care have increased by 51.5 per cent since 2005. We are not sure why this is happening in Australia, because Australia collects no comprehensive data on these children.

The children in these categories remain underacknowledged and let down by our current policies and public services, and it is for them that a National Children's Commissioner will be of most significance. An appropriately resourced National Children's Commissioner will give Australian kids a voice at the national level and bring attention to issues of neglect, abuse and discrimination. An effectively resourced national advocate for children will offer a powerful focus for hearing children's voices, especially on the subjects of youth justice, child protection, Indigenous health outcomes and homelessness.

The commissioner will have an important role in monitoring, reviewing and commenting on laws, policies, services standards and practices that affect young Australians. As part of the Australian Human Rights Commission, such a position will have the mechanisms to receive and investigate complaints of breaches of children's rights under the Convention on the Rights of the Child through the implementation of child-specific complaints system. It will be able to assist in and drive law reform and policy development and develop consultation mechanisms that encourage the participation of children. An effective commissioner will collaborate and coordinate with the community and business sectors to develop and strengthen community understanding of the issues and experiences of children, and have the power to intervene in court proceedings involving the rights of children and young people.

The commissioner must advocate for effective data collection on children's health, wellbeing, development and participation and, of course, all of these tasks and functions will depend on appropriate resources. In the past there have been too many instances where a lack of coordinated response by governments and their departments have allowed children and young people to suffer. Youth homelessness and the health and education of Indigenous young people are two obvious examples. We really need bipartisan support for the role of National Children's Commissioner to ensure that the outcomes for children are effective. The commissioner will, of course, have guaranteed independence from government and it should be a matter of common ground to support a properly resourced commission.

This is a welcome and exciting announcement, but the hard work of implementation is ahead of us. My question, then, to the Attorney-General is: how is this budget set up to put the needs of Australian kids front and centre of the development of government policies and programs now and into the future?

Nicola Roxon (Gellibrand, Australian Labor Party, Attorney-General) Share this | Link to this | Hansard source

I thank the member for Freemantle for her question on something that she has passionately advocated for throughout her professional career and for which she was most recently able to make a change to the Labor Party platform—something that we are now acting on in this budget.

As the member mentioned, it is something that I also have a strong and long personal attachment to from my position as the shadow minister for children and youth many years ago. More than 10 years ago, in fact, we first announced a policy proposing a National Children's Commissioner, and it gives me great pleasure that, in the budget, we have now dedicated finances to be able to make this a reality. It is an unusual situation to have an extra, separate budget line item rather than simply an increase to the Human Rights Commission's budget. That is because we are conscious of the issues that the member has raised: to make sure that we have sufficient resources and dedicated resources. I know the commission is very excited about this additional formal responsibility being added to its remit.

We have proposed the legislation that will be able to establish this, and though we have not yet had an indication we hope that we will have an indication of support from the opposition. We will make it clear that a National Children's Commissioner has certain responsibilities and does not have others. Those certain responsibilities are to make sure that there is a particular focus on those who, as the member for Fremantle has mentioned, are vulnerable and disadvantaged. Many, many children in Australia have wonderful lives. When you look around the world, Australia is one of the best countries for a child to be born in; however, there are children in Australia who do not get the benefits of that. This commissioner will have particular responsibilities to make sure that those disadvantaged groups in particular are focused on.

I also flag that, unlike other proposals that have been floating around—for example, the proposal by the Greens party—our proposal is that the commissioner will not have a complaint-handling role dealing with individual children, nor will the commissioner take on child protection matters or family law matters for individuals, nor act as a legal guardian. It is important to emphasise that there are other bodies that fulfil those roles. We want this to be an opportunity to advocate for systematic reforms and improvements for children across disadvantaged groups. It is very important that we match the responsibilities to the resources available. An undertaking which required the National Children's Commissioner take on those additional roles would, of course, need to be resourced well above the current proposal, and would duplicate many of the responsibilities for children that lie with other agencies.

I am very excited that this is in the budget. I think it is an important step forward for children. I look forward to having an indication—hopefully sometime soon—from the opposition that is something that they will support. There will, of course, be a debate in the parliament when the legislation is introduced and, after that, an opportunity for us to recruit and employ the first ever National Children's Commissioner.

Michael Keenan (Stirling, Liberal Party, Shadow Minister for Justice, Customs and Border Protection) Share this | Link to this | Hansard source

): I want to ask the Minister for Home Affairs about the process of issuing media releases and informing the Australian public about illegal boat arrivals.

My colleague in the other place Senator Abetz asked some questions about this during the estimates process and we did get some very comprehensive information back from the government. That information told us that Customs reports a boat arrival to the minister's office within about six hours, on average, and that the average time it took the minister's office to issue a publicity release was just over 15 hours—about double that time.

I want the minister to inform the House about how this process works. Has Customs ever formally requested that the minister's office not issue a public media release until the boat has been intercepted, or is it up to the minister's office as to when this release is issued?

According to information that we have been provided with, there have been at least 10 instances where there was a delay of two to four days before informing the public about a boat arrival. I want an explanation as to why that would happen.

I also want him to explain the process of issuing of a media release in relation to the detection of illegal boat arrivals: Once detected, who informs the minister's office? Who is notified? What is the chain of communication and, ultimately, who gives final approval for the release? Is it the minister who gives this final approval?

Jason Clare (Blaxland, Australian Labor Party, Minister for Home Affairs ) Share this | Link to this | Hansard source

): I thank the member for his question. I am not sure what it has got to do with the budget, but I am happy to answer it anyway.

My office is informed when Border Protection Command are aware of a boat. The release is not issued until the boat has been intercepted and the information in that release can be confirmed. From time to time, we will be told that a boat has been detected, and that from the air it can be determined that there might be 30 or 40 people on the boat, but the release is not issued until an interception has occurred and we can confirm those numbers to provide the information that you receive in the press release. That is, I think, the appropriate course of action to make sure that the information that is provided to you and to the media is as accurate as it could possibly be.

You asked who ultimately approves the release—me. It is my name at the top and it is my obligation to make sure that the information is accurate. I cannot speak for previous ministers, but I am assuming that that is the practice that they adopted in the past: to make sure that a statement is issued only once the boat has been intercepted and all of that information can be properly and accurately provided.

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

Again, my question is to the Minister for Justice. I know the minister is very familiar with my electorate, having himself grown up there. In fact, his mother and father are still constituents of mine; hopefully happy constituents. Apart from being the most multicultural electorate in the whole country, one of the things that really distinguishes my electorate is the number of families. The minister will no doubt recall some 12 years ago areas at the centre of my electorate, particularly around Cabramatta, were very much the destination or the distribution points for drugs and illegal firearms. As a matter of fact, the communities were terrorised in those days by organised crime gangs as they ran these illegal operations around the streets of south-west Sydney.

It is very concerning that of the 24 shootings that have occurred this year, the vast majority of those have occurred in Western Sydney—a number of them in my electorate and, indeed, in the minister's electorate. I know that this is putting extraordinary pressure on local families. Many think there has got to be a greater police presence. Our police are doing a wonderful job on the streets of south-west Sydney. I personally stay in regular contact with the commanders of the Green Valley police, Cabramatta police, Fairfield police and the Liverpool police. I have a fair understanding about what our police are doing out there. I am wondering whether the minister could outline to the House how these weapons are coming onto our streets? The fact is that there have been 24 shootings and it is having such an effect on local families, who want to bring up their children in safety. Having these headlines appear out there is something which is certainly deleterious for the whole community. Minister, if you would outline to the House your view about where these weapons are coming from?

Jason Clare (Blaxland, Australian Labor Party, Minister for Home Affairs ) Share this | Link to this | Hansard source

I thank the member for Fowler for his question and his interest in this matter.

A division having been called in the House of Representatives—

Sitting suspended from 12:17 to 12:30

Once again I thank the member for Fowler for his question. We both have seats, and live, in Western Sydney. We see this up close and understand the impact it is having on our constituents. What is happening, effectively, is a war between rival bikie gangs fighting over drugs and turf, and our communities are in the middle of that fight. There is a real concern, a justified concern, that a stray bullet is going to hit an innocent person and that an innocent person could be killed. That is why in February I ordered a national investigation, headed up by the Australian Crime Commission, into the illegal firearms market. Last month they provided their interim findings, which show that there is a very large local black market made up of tens and tens of thousands of illegal firearms—more than 10,000 illegal handguns alone. A lot of these guns are 10, 20 or 30 years old and they do not have a use-by date. Two of the guns that have been seized in the last year were more than 100 years old and are still working.

This black market is made up of firearms that criminals get from crooked dealers, firearms that were not surrendered or registered after the Port Arthur massacre, firearms that are made or reactivated by backyard operators and thousands of firearms stolen from legitimate owners. In New South Wales alone, 7,000 guns have been stolen by criminals in the last 12 years and not recovered. That is 7,000 unsolved gun crimes and 7,000 guns in the hands of criminals. We saw evidence of this on Channel 7's news recently, a report that contained information from the NSW Bureau of Crime Statistics and Research in New South Wales. The report revealed a nearly 20 per cent jump in the number of firearms stolen in New South Wales alone in the past 12 months—640 firearms stolen in the past year, most of them in Western Sydney, including 112 pistols, 56 revolvers and 339 shotguns. There were 1,706 firearms stolen in New South Wales in the past three years and, across the country, more than 7,000 firearms have been stolen in the last five years. The most recent example of this came just yesterday. New South Wales police reported eight pistols and eight rifles, and thousands of rounds of ammunition, stolen from a property near Baradine in the electorate of the member for Parkes. We also face the problem of firearms disappearing from state databases when people move interstate or die. The advice of CrimTrac is that about 1,400 weapons a year fall off the register and into the grey market.

The final report of the Australian Crime Commission will be considered by police ministers next month. At that meeting we will consider a raft of recommendations covering firearms, criminal reforms and other areas. Australia already has some of the toughest gun laws in the world, but there are a number of areas where we can improve upon them. I am working very closely with Mike Gallacher, the New South Wales police minister, on developing a plan to take to this meeting in four weeks time which includes the rollout of the IBIS system right across the country. IBIS does ballistics analysis of firearms that are seized from criminals. It is the sort of testing that can link firearms to previous crimes. At the moment New South Wales and the Federal Police have the system, but it does not exist across the rest of the country. I believe, and Mike Gallacher believes, in the need to roll it out nationwide. There is a lot more we need to do. Police need intelligence on who the shooters are, where the weapons are and what they are being used for. That means breaking down the wall of silence, the fear that exists in our communities of dobbing somebody in, the fear of retribution. It means making weapons harder to steal and easier for them to be seized by law enforcement. It also means tougher firearms laws and the rollout across the country of tracing technology like IBIS. Delivering these reforms will require us to all work together, and I am determined to get it done. Over the next few weeks, I will be travelling the country and meeting with police ministers to make sure that we deliver the reforms that we have to when we meet in June. That is what the people of Western Sydney expect of us and that is what we must deliver.

Proposed expenditure agreed to.

Debate adjourned.