Senator WONG—Professor Boymal, we appreciate that you could make it; I understand there was a clash.

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Prof. Boymal—Thank you very much. My board is meeting today and tomorrow.

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Senator WONG—It is unfortunate timing, and we will try to get you back there, from my perspective, as soon as possible. There were some things that I did want to raise with you arising out of both an Audit Office report into the financial statements of Australian government entities and your action alert in terms of your current work. I could not find this, but you may well have done this. The Auditor-General refers to a policy paper you were seeking to issue in December. Has that gone out? This is in relation to public sector accounting standards.

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Prof. Boymal—There is a policy paper—December does not ring a bell with me—on public sector accounting standards. I believe the last version of it was in October 2006. But it is a sort of running document, so we amend it and put an amended version back on the website. I think I have the document in front of me.

Senator SHERRY—I am a little surprised that you do not have some sort of estimate of either the numbers or the expense claim for the impact on revenue.

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Mr D’Ascenzo—We do have a break-up of expense claims that are on our return forms, in other words the blocks, and we are able to match how those blocks are tracking.

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Senator JOYCE—You could have a specific section on the return for home office expenses and you would be able to download that specifically?

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Mr D’Ascenzo—We could but then you would have X number of pages. It is a question of how much in the way of compliance costs you want to burden the community with in terms of risk management.

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Senator JOYCE—Do you just look for a bell curve and go for the extremes of the bell curve and, if it was outside the general tolerance, you would go and concentrate on that?

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Mr D’Ascenzo—Our system in terms of individual returns does that but in terms of aggregate returns, we do carefully monitor how those aggregates are moving but, on an annual basis and relative to how the economy is operating and what we expect, if there is any jump there then as Mr Konza explained, we will then do follow-up survey work or direct active compliance activity.

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Senator JOYCE—You send us little letters telling us to watch ourselves.

Ms Vivian—I can, although I can only give it to you for the tax office. Do not forget there are other agencies involved and they would have been included in that figure. Again, this is just an estimate. Most of the capital is actually tied up with our IT costs, so it does seem that some of the accounting treatments can vary. Out of the tax office costs it is about $53 million.

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Senator SHERRY—$53 million in total over the four years?

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Ms Vivian—Yes, over the four years. That was what was included in our estimates.

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Senator JOYCE—How much did you spend on pencils last year?

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Ms Vivian—I am unable to assist with that.

Senator SHERRY—Whatever the veracity of the China Daily publication and the report that Beijing is to become the home, do you have any information about how the Asian exchange, wherever it is to be located, will be operating?

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Ms Mrakovcic—No.

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Senator JOYCE—What about the Indian one? Do you know anything about the Indian one, or the Mongolian one?

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Senator SHERRY—Senator Joyce, when you move into opposition you will appreciate these opportunities. If you want to search for irrelevancy, look back over the Hansard to some previous contributions of former Senator Bishop, interspersed with tirades of officials.

Senator JOYCE—I would like to ask a relevant question. With these emissions trading models, is there a belief that, if we ever go down this path, we can actually have it so that it is relevant to people on the ground? What I mean by that is, for instance, with farmers and the carbon that they obviously have tied up in things such as timber on their property, can they be part of the process so that they feel some sort of sense of ownership and want to participate in it? The fear is, currently, that this debate will benefit big business and government but people on the ground are going to be ignored. In any discussions that you have come across or are aware of, does it show relevance of how it connects to the individual Australian citizen on the ground being a participant in the process and being a benefactor of it?

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Ms Mrakovcic—It comes down to the whole set of design issues around how you might set up an emissions trading scheme, as to what sectors are covered, what kinds of incentives are provided for inclusion for different sectors to undertake abatement activity and the extent to which different sectors of the economy are impacted by the cost of abatement activities.

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Senator JOYCE—Would the bush, forest or trees be seen as a relevant item of trade in an emissions trading scheme?

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Mr Tune—You would imagine that someone who planted trees on their farm or property could enter that trading system.

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Senator JOYCE—Would it be also viable if they were just there and endemic to the area and they say that they will never touch them but they will trade them?

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Ms Mrakovcic—It goes back to the design issues. There is no clear answer. It is basically an arbitrary issue as to how you design the scheme.

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Senator JOYCE—The point that I am getting to is that the ownership of carbon as tied up in trees becomes a possible negotiable instrument at some time in the future if this goes forward. If that is the case, change of ownership of that carbon as held in forest or trees when a government takes control of the asset—as the Queensland government has, by the stroke of a pen, taken that asset from the landholders and invested it in the state; and in New South Wales they have done the same thing—means the government has stolen an extremely valuable asset that would have been worth billions of dollars had it been held by the landholder.

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Ms Mrakovcic—It comes down to the issue of where the property right has been deemed to have been held at any particular time.

Senator JOYCE—About the investment in human capital and the returns on that, isn’t that a nefarious type of subject? How do you make that a quantifiable issue to study? It is all in the eye of the beholder, isn’t it?

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Mr Tune—It is extremely difficult; I would accept that. The way that the PC has gone about it is that the underlying objectives of the NRA in both the human capital side and the competition regulation side are to improve labour force participation and also to improve productivity, so what the PC have tried to do is to look around for outer envelopes. If you can increase labour force participation in Australia by X, what might be the flowthrough effects to economic growth?

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Senator JOYCE—It must be a very tenuous model. It is a model based on a model based on a mystery wrapped up in another mystery. How do we start defining these in such a way that it is rel