by leave—I move:
That the Tax Laws Amendment (2011 Measures No. 1) Bill 2011 be referred to the Main Committee for further consideration.
Question agreed to.
For the information of members, I present the report of the Australian Parliamentary Delegation to the 19th annual meeting of the Asia Pacific Parliamentary Forum, Ulaanbaatar, 22 to 27 January 2011. As leader of the delegation, I am pleased to present the report of its participation in this meeting. The delegation members comprised the member for Reid, John Murphy, and Senator Anne McEwen. This was a smaller group than usual, as two delegates remained at home to assist constituents during the flooding in Queensland and Victoria. A delegation from our parliament has participated in every annual meeting of the APPF, as well as the meetings that prepared for the establishment of the forum. I attended my first APPF meeting in 1998 and since then I have had the pleasure of attending the meetings in Vientiane in 2009 and Singapore in 2010.
This is an organisation that is relevant to Australia, as the countries that participate are clearly significant to our strategic and economic interests. There are many different perspectives presented in the APPF and we recognise that it is healthy to have open debate and resolve any differences that might arise by agreeing on resolutions before the meeting concludes each year. Over the years I have observed that at least some measure of understanding is gained for the views and interests of regional neighbours. This year’s meeting was no exception.
I turn now to the substance of the meeting. There were three broad subject headings on the agenda: economic and trade matters, political and security issues, and interparliamentary cooperation. The delegation proposed a resolution on the reform of the APPF. Each of us spoke in the plenary on a range of items, and the delegation participated in all sessions of the drafting committee, where draft resolutions are settled before they are returned to the plenary for adoption at the final session.
In addition, the delegation was pleased to have meetings with the Prime Minister of Mongolia, Mr Batbold Sukhbaatar; the Chairman of the State Great Hural, who was the President of APPF19; and the delegations from Russia, South Korea and China. A range of bilateral issues were discussed; however, I would like to note and emphasise that all those we met with were aware of and passed on their sincere condolences and sympathy in relation to the floods in Australia.
Our hosts were generous in their hospitality and we thank them for that. We were especially pleased to meet the Vice-Chairman of the Hural, Mr Enkhbold Nyamaa, who studied at the University of Sydney courtesy of an AusAID scholarship, and who went out of his way to welcome us and ensure that we met a number of Mozzies—members of the Mongolia Australia Society.
When I presented the report of the delegation to the 18th annual meeting, I mentioned some issues that had arisen regarding the APPF’s rules and their interpretation—which is not surprising in an organisation that is almost 20 years old. Following the meeting, the Honorary President, Mr Nakasone, sought input on possible reforms from all member countries. There is a real need to ensure that the APPF reflects our changing region and remains relevant to all members in both its framework and operations. I made a proposal to the reform process and spoke to that agenda item at the meeting.
It was pleasing to hear that a number of other countries had also commented on the future of the forum, and these comments were consolidated in a report by the Japanese delegation. Further consultation is taking place, with a view to implementing reforms at the 20th annual meeting that is scheduled to be held in Tokyo in January 2012.
In passing, I will say that I hope the situation in Japan has improved sufficiently by then to enable our colleagues in the Japanese Diet to fulfil their wish to host this historic anniversary meeting.
In preparation for the meeting, the Department of Foreign Affairs and Trade in Canberra assisted us, as usual, with comprehensive briefing materials. The International and Community Relations Office of the parliament provided logistical support. The delegation appreciates this assistance.
Australia does not have an Embassy in Ulaanbaatar, the embassy in Seoul being responsible for relations with Mongolia. I express the delegation’s thanks to the First Secretary, Mr Charles Adamson. Mr Adamson was in Ulaanbaatar to meet us when we arrived, and he farewelled us at our early morning departure on 27 January. In between, Mr Adamson provided excellent advice on Australia’s interests in Mongolia as well as on other matters that arose during the APPF and bilateral meetings.
Ulaanbaatar is the coldest national capital in the world and the meeting was held in the middle of winter. I will not comment on the challenges of the climate other than to note that our hosts made great efforts to ensure that we were kept as warm as possible, and that it was the coldest Australia Day the members of the delegation are ever likely to experience.
I thank the member for Reid and Senator McEwen for their cooperation and enthusiastic representation of the parliament. I thank the delegation secretary, Catherine Cornish, for her thorough and professional support of the delegation. I thank my senior adviser, Mr Christopher Paterson, for his advice. I believe the delegation represented the parliament effectively.
I seek leave to make a short statement in connection with the report.
Leave granted.
I am very pleased to join with you, Mr Speaker, to speak about the delegation to the APPF in Ulaanbaatar. Like you, I would like to express our thanks for the warm welcome and the generous hospitality we enjoyed in Mongolia. For me the experience was a very valuable one, not least because of the opportunity to articulate Australia’s trade interests and to observe again the long-term impact of AusAID’s work.
Mr Speaker, as you know, in the plenary I spoke on promoting economic partnership and free trade. This was a useful opportunity for me to discuss Australia’s strategic approach to trade and our sustained work on trade liberalisation. I also spoke about Australia’s approach to trade reform and its contribution to regional structures and work on agreements such as Pacer Plus and the ASEAN-Australia-New Zealand Free Trade Agreement. I also noted the work of APEC in building the prosperity of the Asia-Pacific and the significance of APEC economies to Australia’s economy.
Australia’s work on trade liberalisation over many years has brought benefits to Australia and also to many of the countries represented at the APPF. It was pleasing to see acknowledgement of that work. It was also reassuring to see general acceptance of the need to continue a regional commitment to free trade, even as many countries are still recovering from the global financial crisis and may be tempted to adopt protectionist measures.
I refer to another aspect of Australia’s work in the region. As you remarked, Mr Speaker, the Vice-Chairman of the Parliament, Mr Enkhbold, was able to study in Australia because of an AusAID scholarship. Clearly he valued that part of his education and the relationships he established here. Mr Enkhbold has continued his links with Australia through the Mongolia Australia Society which is made up of not just expatriate Australians but also Mongolians who have been able to live and study in Australia, often because of AusAID assistance. It is clear that the capacity that is built and the relationships that are formed through education are of long-term benefit for the recipients and for Australia’s reputation. We appreciated the welcome Mr Enkhbold extended to us, particularly as he was fully occupied with APPF obligations.
We also appreciated the expert assistance of a member of the Mongolian parliament’s secretariat, Mr Amartuvshin Amgalanbayar. Amartuvshin, as you know, studied at Monash University—he is a Mozzie—and we were very fortunate to have him as our liaison officer. Not only was he unperturbed by our accents and customs but also he managed to anticipate just about every possible need and to meet it before we managed to ask about it. As you mentioned, we were also fortunate to have the assistance of Mr Charles Adamson, the First Secretary in Seoul. His knowledge of Mongolia and of many of the issues under consideration was valuable to us throughout the meeting.
It certainly was an Australia Day that we will never forget, the coldest we will ever experience. But I am sure we are very grateful to have been able to spend it with our colleagues in such an interesting place and at the same time to represent the parliament. Finally, Mr Speaker, I would like to thank you for your leadership of the delegation and I would also like to thank your senior adviser, Mr Christopher Paterson, and Ms Catherine Cornish, the delegation secretary, who provided excellent support and assistance to the delegation. They did a first-class job.
I move:
That standing order 31 (automatic adjournment of the House) and standing order 33 (limit on business) be suspended for the sitting on Thursday, 24 March 2011.
Briefly, this is the standard motion that is moved at the end of a period. Passage of legislation is unclear at this stage, in terms of advice from the Senate. I will inform the House and inform the member for Menzies during the day about how that is proceeding. At this stage we are once again in the hands of our colleagues in the other chamber with regard to the time this evening’s business will be completed and as to whether we have to come back here at some later stage. I commend the motion to the House.
Question agreed to.
I move:
That leave of absence be given to every member of the House of Representatives from the determination of this sitting of the House to the date of its next sitting.
Question agreed to.
I move:
That so much of the standing and sessional orders by suspended as would prevent the following items of private members’ business being reported from the Main Committee or called on and considered immediately in the following order:Foreign ownership of agricultural land and agribusiness —Order of the day No. 18;Workforce participation of people with a disability —report from the Main Committee;Climate change and a carbon price —report from the Main Committee;Multiculturalism in Australia —Order of the day No. 16;Loss of the Malu Sara—report from the Main Committee; andCommunity hospitals in South Australia —report from the Main Committee.
Question agreed to.
Debate resumed from 3 March, on motion by Mr John Cobb:
The question is that the motion be agreed to.
I seek leave to amend the motion in terms circulated to honourable members in the chamber.
Leave granted.
I move:
That this House:
These amendments are more about procedure and practical ability of the department and the various bodies that are tasked with the jobs in ABS, ABARE, et cetera—for example, requiring a biennial instead of an annual formal statistical release. It is more about the ability of the department or departments to do their job rather than changing in any substantial way the intent of the motion.
Is the motion seconded?
I second the motion.
The original question was that the motion be agreed to. To this the member for Calare has moved amendments. The immediate question is that the amendments be agreed to.
Question agreed to.
The question now is that the motion, as amended, be agreed to.
Question agreed to.
Debate resumed from 28 February, on motion by Mrs Moylan:
That this House:
I seek leave to amend the motion in terms circulated to honourable members in the chamber.
Leave granted.
I move:
That this House:
Is the motion seconded?
I second the motion.
The original question was that the motion be agreed to. To this the member for Pearce has moved amendments. The immediate question is that the amendments be agreed to.
Question agreed to.
The question now is that the motion, as amended, be agreed to.
Question agreed to.
Order of the day returned from Main Committee for further consideration; certified copy presented.
Question put:
That the motion (Mr Stephen Jones’s) be agreed to.
Question agreed to.
Debate resumed from 28 February, on motion by Mr Laurie Ferguson:
That this House:
The question is that the motion be agreed to.
Question agreed to.
Order of the day returned from Main Committee for further consideration; certified copy presented.
Ordered that the order of the day be considered immediately.
The question is that the motion be agreed to.
by leave—I move that the motion be amended to read:
That this House:
Is the motion seconded?
I second the motion.
The original question was that the motion be agreed to. To this the member for Leichhardt has moved amendments. If there is no objection, I will put the question in the form ‘That the amendments be agreed to’. There being no objection, the immediate question is that the amendments be agreed to.
Question agreed to.
The question now is that the motion, as amended, be agreed to.
Question agreed to.
Order of the day returned from Main Committee for further consideration; certified copy presented.
Ordered that the order of the day be considered immediately.
The question is that the motion be agreed to.
Question agreed to.
Mr Speaker, I wish to make a personal explanation.
Does the member claim to have been misrepresented?
Yes.
Please proceed.
Last night on the ABC, on ABC1 7 pm news, the ABC ran a story which asserted that a video of an Australian Defence Force operation in Afghanistan had not been made public because ‘the defence minister’s office kept it under wraps for months’. That assertion was supported in the story by comments from former Chief of Army Peter Leahy. That assertion is completely false. There is no basis nor evidence for such a claim made by the ABC. Indeed, the first time I saw the video was this morning.
The facts are these. Release of videos of operations in Afghanistan are decisions for defence officers and defence officials either in Afghanistan or in Canberra. Those decisions are made on the basis of operational security. Those decisions are not for me. These videos do not come to me or my office for decision making. The ABC reported this story, despite being advised by my office before the report went to air that this was the case. The system has been in place for a number of years. It is the same system that applied when Mr Leahy was Chief of Army. I am not aware of any suggestions by Mr Leahy as Chief of Army that the system should be changed. I thank the House.
As required by resolutions of the House, I table copies of notifications of alterations of interests received during the period 26 October 2010 and 23 March 2011.
Bill and explanatory memorandum presented by Mr Swan.
Bill read a first time.
I move:
That this bill be now read a second time.
The Gillard government has been working since day one to build up competition in the banking system and to get a better deal for consumers.
In December, I announced a comprehensive package of new reforms to empower families, support smaller lenders and secure the flow of credit to our economy.
These build on the decisive actions we took during the global financial crisis to preserve the competitive foundations of our banking system.
Our bank guarantees supported deposit funding for smaller lenders and enabled non-major banks to raise $65 billion in wholesale funding.
Our $20 billion investment in AAA rated RMBS continues to support this critical funding market which many smaller lenders rely heavily on.
All of this means loans are there when families need to buy a home and credit is available when a small business wants to grow.
Competition means getting these loans at a fair price—and that is our objective.
Today I introduce amendments to the Competition and Consumer Act 2010 to crack down on anticompetitive price signalling and to get a better deal for consumers in the banking system.
These laws will be initially targeted at the banking sector, because the ACCC has told us there is strong evidence of banks signalling their pricing intentions to each other in a bid to undermine competition.
We have been very clear all along that we would only extend these laws to other sectors of the economy after further detailed consideration.
The ACCC advised me last year that it was concerned about the behaviour of ‘some of the banks in signalling in advance what their response will be to a change in interest rates by the Reserve Bank’.
In the Senate Economics References Committee’s banking competition inquiry, due to report this month, the ACCC gave testimony that:
The problem with that sort of comment—the evil of it, if you like—is that it says to the competitors, ‘If you increase your interest rates I will follow,’ which means you are signalling to the competitor that if they increased their interest rates they would not need to worry about being stuck out there on their own and losing market share.
This type of anti-competitive price signalling can be just as harmful to Australian consumers as an explicit price-fixing cartel.
So there is a gap in our competition law which has allowed the banks to escape the full force and discipline of competition.
The ACCC provided very strong advice that banks were giving each other a ‘nod and a wink’ that they would raise their rates together.
However, because they were not actually writing it all down and signing in blood, or even agreeing verbally how they would act—they could get away with it.
This kind of conduct by the big end of town should never be allowed to continue when designed to dud Australian families.
That is why we are closing this gap in our competition law which is already dealt with in other major jurisdictions like the United States, the UK and the EU.
That is why we are building on our 2009 reforms to strengthen Australia’s cartel laws, by banning signalling designed to keep interest rates higher.
Our tough new laws will give the ACCC the power to take action against banks who signal their prices to competitors to undermine competition.
Policy development process
The government has been carefully developing competition policy in this area for some time, and monitoring global comparisons.
The OECD’s roundtables on facilitating practices and information exchanges, in 2007 and 2010, have clearly highlighted the harm to consumers that can arise from anticompetitive price signalling.
Many stakeholders in Australia strongly agree that anticompetitive price signalling is not prevented by our existing competition law.
They have told us that this conduct is best targeted by providing new, specific prohibitions which prevent price signalling occurring.
This is precisely the approach that we have taken to provide certainty to the business community whilst ensuring robust protection for consumers.
Amendments to Competition and Consumer Act 2010
This bill is fundamentally about stamping out conspiratorial behaviour by the big banks which is not caught by our competition laws.
These tough new laws have two limbs.
First, the bill gives ACCC the power to take action against any bank which signals its pricing intentions to a competitor for the purpose of substantially lessening competition.
We are cracking down on banks who purposely signal to their competitors that they should all raise their mortgage rates together.
It is inherently damaging to consumers for any bank to essentially say to its competitors ‘don’t worry—if you raise your mortgage rates then I won’t undercut you or take your customers’.
It allows banks to move their interest rates higher without the full discipline of competition—and at the expense of the consumer, and it is unacceptable.
This anticompetitive behaviour is a bad result for Australian families and small businesses.
This bill allows a court to infer the real purpose a bank has in making such a statement—so there is no need for a ‘smoking gun’.
Of course, we are not talking here about ordinary commercial communications.
Every Australian bank will be able to communicate with its customers, shareholders, market analysts, employees and other stakeholders in the ordinary course of business—just like they always have been able to do.
What we are doing here is cracking down on the insidious practice of signalling between banks which is designed to undermine competition and which inevitably hurts consumers.
The second limb of the law will prevent banks from discussing their prices with each other behind closed doors.
This prohibition is automatic because there can only ever be a limited range of situations where it is legitimate for competitors to discuss prices.
This prohibition is targeted at those disclosures which are the most clearly anticompetitive and which are most damaging to consumers.
For example, the ACCC can take action if one bank phones another bank privately to tell them about a planned mortgage interest rate rise.
Of course, the bill recognises there will be situations where banks need to discuss pricing with their competitors in a private context.
Exceptions and defences
We recognise that businesses need certainty and appropriate guidance so that they can conduct legitimate activities on commercial time frames—and keep providing services to customers.
That is why we have worked closely with the ACCC since mid-2010 to carefully design these amendments, and have consulted extensively on draft legislation with industry, legal experts and other stakeholders.
Of course, all banks will be able to fully comply with any continuous disclosure obligations they have, such as discussing their funding costs.
And they will be able to fully comply with their broader legal or regulatory obligations.
The bill contains explicit exemptions for all of this.
After consulting closely with the business community, we have also made amendments to ensure private disclosures of prices can continue for legitimate business activities.
This has been done largely by clarifying exemptions that were contained in the exposure draft legislation or by providing clear new exemptions.
For example, we have a clear exemption for banks who are considering forming a joint venture and need to discuss prices first to decide whether they should in fact enter a commercial arrangement.
Depending on the circumstances, an arrangement like a syndicated loan—when banks get together to lend to a business customer—would likely fit the definition of a joint venture.
That means that banks will be able to go ahead and get on with the business of lending provided they are not being anticompetitive.
We have got clear carve-outs in the bill so banks can distribute their products through financial planners or mortgage brokers.
There are then further exemptions so banks can keep talking to each other about trading financial market products such as bonds or currency.
The bill contains arrangements for banks to seek immunity when their conduct provides a net public benefit to the community.
This allows legitimate conduct to occur where it is not covered by one of the other explicit exemptions—some of which I have just mentioned.
Following consultation with the business community, the bill now includes a ‘notification’ regime to meet shorter commercial time frames.
Where a bank can demonstrate a net public benefit, they can obtain immunity by describing the conduct to the ACCC in a notice.
The ACCC then has a limited period of 14 days to respond if it has any concerns about the proposed behaviour.
This is significantly faster and more cost-effective than the ‘authorisation’ process that we had originally discussed with the business community.
Lenders could use this process to exempt a corporate ‘workout’ scenario—where they get together to resolve the finances of a troubled business.
Of course, robust confidentiality arrangements will be available for parties concerned about the commercial sensitivity of proposed conduct.
Conclusion
The bill I introduce today strikes an appropriate balance between allowing legitimate or procompetitive conduct, and cracking down on anticompetitive price signalling which harms consumers.
This important reform will help to ensure that banks can no longer avoid the full force of competition in the marketplace.
The Gillard government is absolutely committed to getting a better deal for Australian families and small businesses in the banking system.
The laws I introduce today are an important part of that.
I encourage all members of the House to support the passage of this bill.
Debate (on motion by Mr Andrews) adjourned.
Bill and explanatory memorandum presented by Mr Swan.
Bill read a first time.
I move:
That this bill be now read a second time.
Today I introduce a bill which delivers on our election commitment to crack down on unfair treatment of Australians with credit cards, and to help them get a better deal in the banking system.
In December, I announced new reforms to promote a competitive and sustainable banking system to give every Australian a fairer go.
We are introducing three broad streams of reform to empower consumers, to support smaller lenders, and to secure the flow of credit to our economy.
Today we are building on our new national responsible lending reforms by giving credit card holders more control over the amount they borrow.
We went to the last election promising to stamp out lender practices which see consumers pay more interest than they should.
And today that is precisely what we will do.
There are some 15 million credit card accounts in Australia.
We simply could not get by from day to day without our credit cards.
An average Australian family will often have two or three different credit cards.
That is why these reforms are so important.
Even if we only save hardworking families a few dollars a week, it will always be a worthwhile thing to do to put in reform in this area.
Of course we recognise businesses need to make a profit, but credit cards are so integral to the family budget that we must ensure every dollar of a borrower’s hard-earned repayments work hard for them.
So the objective here is simple—to encourage the responsible use of credit cards by informed consumers, and to make sure that all Australians get value for money.
This bill also delivers on our commitment last year to introduce a compulsory, one-page key facts sheet for new home loan customers.
Again, this is not going to change the world, but it is very important step in empowering Australians to make the best financial decisions for themselves.
Consumers will be able to compare a loan they are offered by a big bank side by side with what will often be a better deal from their local credit union or building society.
Credit Cards
This National Consumer Credit Protection Amendment (Home Loans and Credit Cards) Bill contains strong measures to give hardworking Australians a better deal when it comes to their credit cards.
We have already overhauled our consumer laws in the past two years.
The commencement of the Australian Consumer Law marked the first time in 100 years that Australians have had a uniform consumer law.
The new National Credit Code introduced for the first time a national consumer credit law with tough new protections for consumers.
Today we deliver on our promise to fast-track reforms through the national credit laws to increase fairness for credit cards holders.
This bill will give consumers more say over how they use their credit cards and help them better understand what they are signing up for.
Banning unsolicited offers to borrowers to increase their credit limit
The bill prohibits lenders from sending unsolicited invitations to borrowers to increase their credit limit, as they sometimes cannot easily afford to do so.
Australian families who accept these types of offers can, over time, end up with too much credit card debt which can take years to pay off.
Of course this means they are saddled with significant interest payments which make it that much tougher to balance the family budget.
Some families have seen their credit card limit blow out to over $10,000 after a series of unsolicited offers, and may only be able to afford repayments of around $200 a month.
On a typical credit card at an interest rate of around 20 per cent interest per year it would take them about nine years to repay this level of credit card debt, and, of course, they would be slugged with over $11,000 in interest bills.
Of course, lenders will be able to continue providing factual advice to their customers about options for reviewing their credit limit.
Consumers will always have the opportunity to consider raising their credit limit if they decide that is the most appropriate way for them.
But this bill ensures credit card lenders will not any longer be allowed to bombard consumers with pre-approved, tick’n’flick offers to increase their credit limit every time they open the mail.
These types of offers will simply be banned.
Consumers will be able to agree upfront to receive pre-approved offers to increase their credit limit—if that is what they want.
But consumers who want to carefully manage their finances will no longer have to resist the temptation these types of offers present.
They will be able to make an informed decision to modify their credit limit—either up or down—if that suits them and their family budget.
But they will not be doing it because they were encouraged to do so by a lender who just wants to make a very quick buck out of them.
Use of credit card in excess of credit limit
The bill prevents lenders charging fees to customers who go over their credit limit, unless they have expressly asked for this service.
Of course, the government recognises that lenders will need the discretion to approve some payments which go over the credit limit.
A customer may have only gone over the limit by a few dollars, so it is important that we leave a bit of flexibility here while protecting the customer.
For example, it is in the interests of the borrower’s family for their lender to honour a payment of their electricity bill so their power is not cut off.
So the industry and consumer groups have agreed it is appropriate to give credit providers the discretion to approve payments like this up to a default buffer equal to 10 per cent of a consumer’s credit card limit.
This is a common-sense outcome which protects consumers, while giving them plenty of flexibility to manage their monthly budget.
However, credit providers will be banned from imposing fees or charges or a higher interest rate on any borrowings using this default buffer.
It is estimated that Australians will save around $225 million annually from this reform alone.
Consumers can opt out of this default buffer if that is best for them. They may consider it would help them manage their finances better.
They will also be able to ask their lender, if they choose, for a larger buffer if they decide they are prepared to pay fees for this service.
But it is up to every consumer to make their own informed decision.
Overall, this critical reform will mean an end to most credit limit overdraw fees and significant savings for Australian families and all consumers.
Warning on statements about only paying minimum repayments
We will further make regulations requiring all lenders to clearly warn consumers on their monthly credit statement of the consequences of only making minimum repayments.
Many consumers fall into the trap of only paying the bare minimum required each month, which ends up costing them dearly over time.
Even slightly higher payments can make a big difference to how much interest they are charged.
This reform is therefore absolutely critical to helping Australians manage their household budget.
The bill also forces lenders to allocate repayments to higher interest debts first, so families do not pay more interest than they should.
Currently, consumers do not have any control at all over how their repayments are allocated, with lenders often using their money to pay off parts of the loan which are actually only incurring low or no interest.
This means that the remainder of the consumer’s debt can be accruing interest at a higher rate, and without being reduced by the repayment.
The reform will address this by ensuring repayments are allocated to the higher interest balances first.
I could not even begin to count the number times that people have come up to me and complained about this particular practice.
This reform might not look like it is a big reform, but it will end up saving money for many Australian consumers from their hard-earned pay packets.
A family could save something like $360 a year or more, depending on their spending habits and credit limit—and of course every dollar counts.
Put simply, we are ensuring that every dollar repaid by a consumer works harder to pay down their debts.
One-page home loan key facts sheet
In December I announced we would introduce a simple, standardised, one-page fact sheet for consumers to compare loans.
Families will be able to compare the cost of different home loans by putting one-page facts sheets from different lenders side by side.
They will be able to tell instantly the savings they could make between different mortgages every year and over the life of the loan.
A potential home borrower could easily compare the relative cost of a mortgage from a credit union against, for example, that of a big bank.
Buying a home is the biggest investment many Australians will ever make, and this bill helps them shop around for the best deal.
Choosing the wrong loan can be very expensive. Half a per cent more interest on a $250,000 loan can cost a borrower $30,000 or more over 30 years.
We are ensuring consumers know how many dollars they will repay for every dollar they borrow so they can compare this across lenders.
Consumers will be able to see and understand the true cost of a home loan, at a single glance.
This reform is all about forcing banks and other home loan providers to be honest and transparent with Australian families.
It is about promoting competition in the banking system and doing a little bit to help all Australians meet the costs of living.
Conclusion
The Gillard government is changing the way banks do business, and putting the power back in the hands of consumers.
We worked hard through the global financial crisis to secure our financial system, and preserve the competitive foundations of our banking sector.
In December, I announced a further reform package to help build up competition again in the banking system for all Australians.
There is no silver bullet here, but the bill I am introducing today is part of our commitment to always stand on the side of consumers.
I encourage all members of this House to do the same. I commend the bill to the House.
Debate (on motion by Mr Andrews) adjourned.
Ordered that the resumption of the debate be made an order of the day for the next sitting.
Bill and explanatory memorandum presented by Mr McClelland.
Bill read a first time.
I move:
That this bill be now read a second time.
The Family Law Legislation Amendment (Family Violence and Other Measures) Bill 2011 addresses a matter of paramount concern to the Australian community.
It is about the safety of our children.
This bill seeks to protect children and families within the family law system from family violence and child abuse.
Introduction
Children are the most vulnerable members of our community.
Most children thrive in happy and cohesive families who put the best interests of their children first. Unfortunately, some children are not so lucky and experience significant conflict, fear, isolation and harm.
Their experiences often occur within the confines of the family home and involve trusted family members. Conflict often escalates during family breakdown increasing the risk to these children.
Often there are strong intergenerational effects.
I cannot accept that it is in any way proper or moral or beneficial to allow a child to suffer, to witness or hear, or to learn about violence.
Plainly, I am sure all members will agree, the opposite is true.
As a government, we cannot tolerate family violence or child abuse in any form.
Evidence base for the legislative reforms
The damaging effects of family violence and child abuse have been recorded in a range of reports commissioned by the government in recent years.
In an evaluation of the 2006 family law reforms released by the government last year, the Australian Institute of Families Studies (AIFS) found that two-thirds of separated mothers and over half of separated fathers reported experiencing abuse, either emotional or physical, by the other parent.
The Australian Institute of Family Studies also found that one in five separated parents surveyed reported safety concerns associated with ongoing contact with their child’s other parent.
A report by the Family Law Council highlights data that victims of family violence receive more psychiatric treatment and have an increased incidence of attempted suicide and alcohol abuse than the general population. Violence is also a significant cause of homelessness.
These are disturbing findings.
Perhaps more importantly, various research reports by leading social scientists and academics clearly show that exposure to family violence and child abuse leads to poor developmental outcomes for children.
Former Family Court judge, the Hon. Professor Richard Chisholm AM, in his Family courts violence review, identified the importance of disclosing, understanding and acting where there is family violence.
Professor Chisholm has stated that many families before the Family Court face the victim’s dilemma: ‘Do I report family violence to the court and risk losing my children, or should I stay silent?’
It is unacceptable that our laws place people in this predicament.
There is no dilemma for this government.
This bill will help to break those ghastly silences by encouraging disclosure of family violence; it will improve the understanding of what family violence is by clearly setting out the types of behaviour that are unacceptable; and it will ensure that appropriate action is taken to prioritise the safety of children.
Key features of the bill
The Family Law Legislation Amendment (Family Violence and Other Measures) Bill will positively address family violence and child abuse in the family law system.
The bill will amend the Family Law Act 1975 (Cth) to promote safer parenting arrangements for children.
Firstly, the bill will prioritise the safety of children in family law proceedings.
This government continues to support shared care and a child’s right to a meaningful relationship with both parents. However, where family violence or abuse is a concern, the courts will be required to prioritise the safety of the child over maintaining a meaningful relationship with each parent.
The act will include an additional object to give effect to the United Nations Convention on the Rights of the Child, to which decision-makers may have regard when dealing with children’s matters under the Family Law Act.
Second, the bill will change the definitions of ‘family violence’ and ‘abuse’ to better capture harmful behaviour. Family violence takes many forms and can affect any family member, be it adult or child, male or female.
The definition of family violence is consistent with the recommendations of the Australian and New South Wales Law Reform Commissions, and I thank them for their valuable work. Behaviour such as assault, sexual assault, stalking, emotional and psychological abuse, and economic abuse are explicitly referenced in this definition.
The definition of abuse in relation to a child will include serious psychological harm as a result of exposure to family violence, and also serious neglect.
This is a vital first step in helping the family law system to identify these problems and to respond appropriately to them.
Third, the bill will strengthen the obligations of lawyers, family dispute resolution practitioners, family consultants and family counsellors to prioritise the safety of children.
Under the proposed reforms, advisers must encourage families, in reaching parenting arrangements, to focus on the best interests of the child and in doing so to prioritise the wellbeing and right to safety of their children.
Fourth, the bill will ensure that courts get the information they need to make safe parenting arrangements.
To this end:
With all relevant information being made available, the courts can ensure that parenting orders will protect children from harm.
Finally, the bill will make it easier for Commonwealth, state and territory child welfare agencies to participate in family law proceedings.
Public support for the bill
The measures proposed in this bill have received overwhelming support from the community and bodies and professionals working in the family law system, and I note many representatives of those organisations are in the House today.
Over 400 submissions were received in public consultation conducted between November 2010 and January 2011.
A massive 73 per cent of people making submissions supported measures proposed in the exposure draft bill. Another 10 per cent made no comment on the bill but offered information about their personal experience.
The government have taken account of all submissions that were received in the public consultation and we have refined the measures that are proposed today in light of that process.
Part of the reason the bill has received such support is because it keeps in place key reforms that encourage meaningful relationships between parents and their children where they are safe.
Various research reports have found that shared care generally works well where the parents have little conflict, can cooperate, and live relatively close together.
This government supports creating happier, healthier outcomes for children.
Other nonlegislative measures
In addition to this bill, the government is taking other actions to combat family violence and child abuse, which I will briefly mention.
Substantial inroads will continue to be made through:
Technical amendments
The bill also includes a number of technical and procedural amendments to the Family Law Act and also to the Bankruptcy Act 1966. These will improve the efficiency and effectiveness of family law proceedings generally, and correct certain anomalies.
Conclusion
In conclusion, introducing this bill is one of the more poignant moments in my time as first law officer of the Commonwealth of Australia.
The Australian public and hardworking members of the family law system have spoken overwhelmingly in support of the bill.
Family violence and child abuse are too common in separating families.
It is a time for honourable members of this parliament to confront these disturbing issues and to make a difference that is long overdue. I commend this bill to the House.
Debate (on motion by Mr Turnbull) adjourned.
Bill and explanatory memorandum presented by Mr McClelland.
Bill read a first time.
I move:
That this bill be now read a second time.
Terrorism is a crime that has a unique and dramatic impact on the lives of its victims.
It is a crime directed not at individuals, but at the state—but individuals are the victims.
Presently in every Australian state and territory victims of crime, including terrorism, are eligible for lump sum payments under criminal injuries schemes.
However, there is no comprehensive scheme that covers Australian victims of terrorism when those incidents occur overseas.
In the past decade Australians have been killed and injured in terrorist attacks in New York and Washington, Bali, London, Jakarta and Mumbai.
Terrorism is an unpredictable and stateless phenomenon.
It can strike almost anybody, in any place and at any time.
It is a sad reality that Australians are sometimes specifically targeted in overseas terrorist acts.
Other times, they are merely caught up in attacks launched indiscriminately at ‘Westerners’.
In either case, these individuals fall victim to attacks with a political or ideological motive, rather than a personal one.
In that context, it is only fair that the burden of the attack be borne in part by the state, and not by the individual victim.
It is important to acknowledge the collective responsibility of the Australian community to help individuals recover from overseas terrorist events.
The Australian government has assisted Australian victims of terrorism in the past, providing them with medical and evacuation support, consular assistance and assisting with funeral costs and other expenses, on an ex gratia basis. The value of that assistance to date exceeds $12 million.
There is, however, more that can be done to ease the suffering and to provide support to Australian victims in the longer term.
It is in this context that the government today commends to the House the Social Security Amendment (Supporting Australian Victims of Terrorism Overseas) Bill 2011.
It should be noted that the bill builds on important work by the Leader of the Opposition, and the member for Paterson by incorporating principles of the opposition leader’s private member’s bill entitled ‘Assisting the Victims of Overseas Terrorism’.
The purpose of the opposition leader’s private member’s bill was to provide additional financial support of up to $75,000 to Australians who are affected by terrorism while they are overseas.
The government’s bill adopts this approach by instituting a new mechanism for providing financial assistance to victims of overseas terrorism, called the Australian Victim of Terrorism Overseas Payment.
The payment will provide up to $75,000 for individuals who are injured in an overseas terrorist event or to a close family member of an individual killed as a result of a terrorism event overseas.
Eligibility under the scheme provided for by the bill requires the Prime Minister to declare an overseas terrorism event in the first instance.
Once an overseas terrorism event has been declared, set eligibility criteria will apply, primarily that an applicant is an Australian resident and did not contribute to the terrorism event.
The bill also sets out principles, which will be accompanied by relevant guidelines, that provide guidance on the factors that may be considered when determining a claim, including:
Consistent with assumptions underlying the opposition leader’s private member’s bill, the scheme will also provide that victims who receive the payment will not have to repay Medicare, workers compensation or any other benefits received from the Commonwealth. This is also consistent with current victims of crime compensation schemes around the country. The payment will also be exempt from taxation.
The discretion to provide payments of up to $75,000 acknowledges not only that injuries resulting from terrorism events tend to be very serious but also that they can have a lasting effect, requiring ongoing support and treatment.
That Australians should be injured or killed in a terrorist act is a horrible thought to contemplate. But it has happened and—unfortunately—it will almost certainly happen again.
Terrorism is a crime that is indiscriminate and has many victims. It devastates not only those directly impacted but their families as well.
It is a crime designed to strike at the heart of all we hold dear in a free and democratic society.
But we are determined that terrorism will not affect how we go about our lives.
The government supports the rights of Australians to continue to explore the world, to continue to discover new places and to represent us abroad, secure in the knowledge that the Australian community, and its parliament, will continue to support them, their families and the Australian way of life.
I would like to again acknowledge the Leader of the Opposition and the member for Paterson for their work in relation to this important issue and for their constructive and positive engagement with the government to achieve the realisation of this outcome.
I commend the bill.
Debate (on motion by Mr Turnbull) adjourned.
Bill and explanatory memorandum presented by Mr Combet.
Bill read a first time.
I move:
That this bill be now read a second time.
The government is committed to action on climate change and the need to reduce our carbon pollution.
This is because the government accepts the science and understands both the damage that unmitigated climate change would cause to Australia and the opportunities for our economy if we do take action.
On 24 February this year we announced the framework for a carbon price to take effect from 1 July 2012. That framework would not place any liability on agricultural, forestry or legacy waste emissions.
However, the government has also committed to create opportunities in these sectors for the creation of revenue through the reduction or storage of carbon pollution.
The Carbon Credits (Carbon Farming Initiative) Bill 2011 fulfils an election commitment to give farmers, forest growers and landholders access to carbon markets.
This will begin to unlock the abatement opportunities in the land sector which currently make up 23 per cent of Australia’s emissions.
Australia has amongst the highest agricultural emissions of the developed countries. But we also have significant opportunities to increase carbon storage in our landscape.
We are a very big country.
This scheme presents an opportunity for Australia to address these high emissions and for the agriculture sector to be part of the solution to climate change.
We are already making progress in this area.
For example, through Australia’s Farming Future, the government has invested $42.6 million into research and development into abatement options for the land sector.
The CSIRO and other research institutions are making important advances in carbon estimation techniques.
And around the country, innovative farmers have been developing ways to improve the health of agricultural soils, to improve herd efficiency and to farm more sustainably.
This scheme will drive and reward the deployment of this Australian innovation.
The Carbon Farming Initiative will create incentives to protect our natural environment and adopt more sustainable farming practices as well as mitigate climate change.
Increasing carbon storage in agricultural soils improves soil health and productivity.
Revegetation will help restore degraded landscape and protect biodiversity.
Tree planting can help to address salinity and reduce erosion.
This is important because the agricultural sector is likely to be one of the most strongly affected by climate change.
The importance of these co-benefits is reflected in the objects of this bill.
We want to achieve carbon abatement in a manner that is consistent with protection of Australia’s natural environment and improves resilience to the impacts of climate change.
The Carbon Farming Initiative will create new, real and lasting economic opportunities for regional communities in this country. Farmers and landholders will be rewarded for their actions to reduce or store carbon pollution. This is a very important step forward for regional and rural Australia.
This is not a government grant program.
The legislated scheme will allow sellers to deal directly with buyers and leverage the opportunities of the marketplace. Such a marketplace allows companies to invest in local land sector abatement through long-term contracts and partnerships with farmers and landholders.
Markets are not new to farmers, nor are many of the things which can save or store carbon—trees and soil. What farmers need is a mechanism to add value to their actions and decide whether or not to invest.
Real and lasting economic opportunities are also what Indigenous Australians are telling us they want. The Carbon Farming Initiative includes a number of provisions to ensure Indigenous Australians can effectively participate and take up these opportunities.
This package of bills creates a legal framework which will provide certainty for private investment in carbon abatement.
The Carbon Farming Initiative provides a framework which is grounded in the science of climate change and provides clear economic value to actions which store or reduce our carbon pollution.
Overview
The Carbon Credits (Carbon Farming Initiative) Bill 2011 is one of a package of three related bills. The two which I will subsequently present to the House are the Australian National Registry of Emissions Units Bill 2011 and the Carbon Credits (Consequential Amendments) Bill 2011.
The Carbon Farming Initiative is a voluntary scheme. There is no requirement on anyone to participate. But those that do will be eligible to receive carbon credits for every tonne of carbon pollution saved or stored.
These carbon credits can be exported or sold to companies that want to offset their emissions or to sell carbon neutral products.
The legislation seeks to balance environmental integrity with administrative simplicity. This is to enable broad participation in the scheme.
The government have made a number of changes to the proposal released for consultation earlier this year to reduce administrative costs. In particular, a lot of attention in the consultation process was focused on what was called the additionality test.
The additionality test has been now streamlined by removing the need to prove financial additionality. Instead, the government will identify and list activities that are not already in widespread use—that go beyond common practice. The government will consult with stakeholders, and may undertake surveys, to identify activities that are beyond common practice. We will adopt a common-sense approach that takes account of local conditions and industry circumstances.
Offsets reports will not be required once reforestation and vegetation has stopped growing and is no longer receiving credits.
Project proponents can choose a reporting period between 12 months and five years.
Audit requirements may be reduced for less complex projects.
This scheme will complement other government commitments to protect Australia’s unique natural environment and enable the development of competitive and sustainable farm industries.
This bill includes provision to exclude projects that have perverse impacts on water availability, biodiversity conservation, employment or local communities from the scheme.
Eligible projects will need to comply with all state, Commonwealth and local government water, planning and environment requirements.
Project proponents will also be required to take account of regional natural resource management plans. These provide a mechanism for local communities to have their say about the type and location of abatement projects.
The government will monitor the implications of the scheme for regional communities and on the environment.
If there is evidence that projects are likely to have a material and adverse impact, we will consider what further protections may be necessary.
On the positive side of the ledger, the government will make it easy to market the co-benefits of abatement projects.
We know that buyers in the voluntary market want projects that have positive environmental and social benefits.
Integrity of abatement
Carbon credits are used to offset emissions. The price that buyers will be willing to pay for credits will depend on their perceived environmental credibility.
Therefore, an independent expert committee, the Domestic Offsets Integrity Committee, has been established to ensure that estimation methodologies are rigorous and lead to real and verifiable abatement.
Other elements of the design of the scheme to ensure the integrity of credits include: issuing credits after the sequestration or emissions reductions have actually occurred; tracking of credits through a central national registry—this is included in the registry bill; transparency provisions including the publication of a wide range of information about approved projects; appropriate enforcement provisions to address non-compliance; and a robust audit scheme based on the National Greenhouse and Energy Reporting Scheme.
Carbon storage has to be permanent if it is going to be treated as equivalent to carbon emissions from the industrial sectors.
The provisions to deal with permanence are rigorous yet they are flexible and well suited to Australian conditions.
Participants would be able to cancel their project and hand back credits issued at any time, for example because they wish to sell the land or use it for something else.
Land managers would not have to hand back credits if carbon stores are lost because of bushfire or drought. This is a very important point to understand. Instead, land manager holders will be required to take steps to re-establish lost carbon stores.
Temporary losses of carbon following a bushfire or drought would be covered by a risk of reversal buffer where a proportion of the credits are withheld.
Conclusion
We must not let the debate that is raging over the carbon price stop us from making a start on land sector abatement through the Carbon Farming Initiative.
We need a long-term framework for rewarding land sector carbon abatement.
This will provide the investment certainty the sector needs to be part of the solution to climate change.
I commend the bill to the House.
Debate (on motion by Mr Turnbull) adjourned.
Bill and explanatory memorandum presented by Mr Combet.
Bill read a first time.
I move:
That this bill be now read a second time.
TheCarbon Credits (Consequential Amendments) Bill 2011 contains consequential amendments and transitional provisions relating to the Carbon Farming Initiative and the establishment of the Australian National Registry of Emissions Units. It also makes various amendments to the National Greenhouse and Energy Reporting Act 2007.
The bill seeks to amend five acts. Most of the proposed amendments will apply existing legislation relating to financial services, anti-money laundering and counter-terrorism financing to units held in the registry. The amendments are intended to provide additional safeguards to protect purchasers of Australian carbon credits and international units, and to provide deterrence against criminal activities involving the Carbon Farming Initiative.
The proposed amendments to the Corporations Act 2001 and Australian Securities and Investments Commission Act 2001 will provide a strong regulatory regime to reduce the risk of market manipulation and misconduct relating to Australian carbon credits and eligible international emissions units. Appropriate adjustments to the regime to fit the characteristics of the different types of units and to avoid unnecessary compliance costs will be made through regulations.
As required by the Corporations Agreement between the Commonwealth, states and territories, the Ministerial Council for Corporations has been consulted about the amendments to the corporations legislation.
The bill also proposes amendments to the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 to ensure that financial institutions and other persons who buy and sell Australian carbon credit units and eligible international emissions units are regulated under that act. These bodies will be subject to reporting and other requirements, including requirements to verify their customer’s identity prior to trading in Australian carbon credit units or international emissions units.
To ensure that the Carbon Credits Administrator has sufficient information to tackle undesirable behaviours by scheme participants, administrators with relevant information, such as the Australian Competition and Consumer Commission, the Australian Securities and Investments Commission and the Greenhouse and Energy Data Officer, will need to be able to share this information with the administrator. The bill therefore proposes amendments to the Competition and Consumer Act 2010, the Australian Securities and Investments Commission Act 2001 and the National Greenhouse and Energy Reporting Act 2007. This will allow, for example, ASIC to disclose information that it possesses about wrongdoing in connection with trading of Australian carbon credit units which is also of significance to the administrator as the operator of the registry.
Part 27 of the Carbon Credits (Carbon Farming Initiative) Bill allows reciprocal flow of relevant information from the Carbon Credits Administrator to these bodies where it is required.
The bill also proposes amendments to the NGER Act to allow the audit framework for the Carbon Farming Initiative to utilise the existing audit framework under the NGER Act. It also proposes to extend the arrangements for reporting transfer certificates beyond 30 June 2011, and other amendments to the act.
Using the existing audit framework under the NGER Act will promote administrative efficiency and reduce duplication; for example, there will be a single register for qualified assurance auditors. It reduces complexity for auditors (many of whom will operate under both acts) as they are already familiar with audit requirements set out under the NGER Act and can apply the same legislative requirements in areas of overlap between NGER and the Carbon Farming Initiative legislation.
Reporting transfer certificates allow the voluntary transfer of reporting obligations relating to a facility from a registered controlling corporation to another corporation. This could occur where the other corporation has financial control of the facility and formally applies for the transfer of responsibilities. These provisions are voluntary and impose no additional burden on industry stakeholders. They are intended to reduce administration and economic costs for industry and increase flexibility in establishing reporting arrangements.
The reporting transfer certificate arrangements were a temporary measure and it was intended they would be replaced by the liability transfer certificate provisions of the proposed Carbon Pollution Reduction Scheme legislation. As this legislation failed to pass the Senate, it is necessary to extend these arrangements.
The bill also provides for transitional measures arising from the Carbon Credits (Carbon Farming Initiative) Bill and the Australian National Registry of Emissions Units Bill. It is proposed that accounts held in the non-statutory registry prior to commencement of the bill will continue in existence under the legislated registry. Pre-existing audit determinations will also continue to have effect.
The consequential amendments contained in this bill are important for the efficient and effective operation of the Carbon Farming Initiative and the National Greenhouse and Energy Reporting System. The amendments seek, where possible, to streamline institutional and regulatory arrangements and minimise administrative costs in both schemes, and to provide additional safeguards for the Carbon Farming Initiative.
I should perhaps have noted during the course of this second reading speech that references to NGER in my address refer to the National Greenhouse and Energy Reporting Act.
I commend this bill to the House.
Debate (on motion by Mr Turnbull) adjourned.
Bill and explanatory memorandum presented by Mr Combet.
Bill read a first time.
I move:
That this bill be now read a second time.
This bill provides for the establishment and maintenance of a robust Australian National Registry of Emissions Units to underpin implementation of the Carbon Farming Initiative.
An efficient electronic registry, governed by clear rules and supported by appropriate enforcement mechanisms, will allow farmers, landholders and other participants with offsets projects under the initiative to receive, hold and transfer their carbon credits securely, with minimum costs and delay.
This important piece of infrastructure will be based on an existing registry that the Australian government established in 2008 to meet key obligations that Australia has under the Kyoto protocol. The bill will put the Kyoto registry, which has operated on an administrative basis to date, on a legislative footing.
Combining the registry functions of the Carbon Farming Initiative and the Kyoto protocol means that anyone who owns tradeable units issued under both systems will be able to hold those units in a single account. This will significantly reduce account establishment and operating costs, and streamline all transactions for account holders.
All accounts that exist in the current registry will be transferred to the statutory registry at the commencement of the Carbon Farming Initiative, without disruption to current account holders.
The bill provides for the recognition in Australian legislation of the emissions units created under the Kyoto protocol. It sets out how these units can be issued and transferred and is consistent with Kyoto protocol rules. The Carbon Credits (Carbon Farming Initiative) Bill 2011 deals with the process for exchanging Australian carbon credit units issued under the Carbon Farming Initiative with certain Kyoto units, which can then be sold in international carbon markets.
Other types of international units may also be recognised through regulations. This would allow other international carbon trading systems to be recognised and possibly linked to the Carbon Farming Initiative.
The bill will clarify that Kyoto and non-Kyoto units held in the registry are to be treated as personal property for the limited purposes of laws relating to bankruptcy, external administration, wills, intestacy and deceased estates, and any other prescribed purpose. This reduces any legal uncertainty surrounding the units in these circumstances.
A range of information in the registry will be made publicly available, including the name of account holders, and the regulations may require publication of the total number of specified Kyoto units held in accounts. This information is required to meet requirements under the Kyoto protocol and is currently available on the Department of Climate Change and Energy Efficiency website. Publication of information will also provide a high level of transparency to ensure public confidence in the Carbon Farming Initiative.
Users of the registry will expect the administrator of the registry to protect their accounts from misuse and to safeguard their carbon credits from theft.
High standards of security and a range of antifraud measures are already being applied to the existing registry. For example, the registry complies with IT security standards set by the Defence Signals Directorate and the United Nations Framework Convention on Climate Change. Anyone seeking to open a registry account must also undergo an identity check.
The bill will introduce additional safeguards to minimise the risk of fraud and misuse of the registry. These safeguards include: criminal penalties for fraudulent or dishonest conduct; powers to suspend registry operations temporarily to address threats to the system; the administrator will have discretion not to transfer units where there are reasonable grounds to suspect that the transaction is fraudulent; powers to correct unauthorised entries in the registry; and powers to close the accounts of any persons who breach their registry obligations.
This bill provides for an efficient and safe system to hold and track carbon credits and other units used to implement the Carbon Farming Initiative and to meet Australia’s international obligations under the Kyoto protocol.
I commend the bill to the House.
Debate (on motion by Mr Turnbull) adjourned.
Bill and explanatory memorandum presented by Mr Snowdon.
Bill read a first time.
I move:
That this bill be now read a second time.
The Governance of Australian Government Superannuation Schemes Bill 2011 (the bill) is part of a package of bills to improve and modernise the governance arrangements for the main Commonwealth civilian and military superannuation schemes.
The bill gives effect to the government’s announcement, in October 2008, to merge the trustees for the Commonwealth’s main civilian and military superannuation schemes—that is, the Australian Reward Investment Alliance, the Military Superannuation and Benefits Board and the Defence Force Retirement and Death Benefits Authority (DFRDB Authority)—to form a single trustee body.
The main civilian and military superannuation schemes that will come under the single trustee are the:
The single trustee will also assume responsibility for the scheme established by the Superannuation Act 1922, the Papua New Guinea Scheme and the Defence Force (Superannuation)(Productivity Benefit) Scheme. These schemes currently come under the Commissioner for Superannuation and, in the case of the latter scheme, the DFRDB Authority and the Commissioner for Superannuation.
The bill establishes the Commonwealth Superannuation Corporation (CSC) as the single trustee. CSC is a Commonwealth authority for the purposes of the Commonwealth Authorities and Companies Act 1997.
Importantly, the bill does not impact on the design of the schemes or on members’ entitlements, which are protected by separate scheme legislation that cannot be changed by the trustee. In particular, there is no change to the existing features and benefits that reflect the unique nature of military service in the Australian Defence Force, such as death and disability arrangements.
The government’s decision to merge the civilian and military trustees was made with the aim of improving member benefits and service levels.
The ability of a single trustee to consolidate scheme funds will provide the opportunity to access increased benefits of scale. This includes access to higher service levels and better investment opportunities, which will allow members of all the schemes to benefit through lower investment costs and higher investment returns.
Members of the Military Superannuation and Benefits Scheme (MSBS)—which comprises the bulk of serving Defence Force personnel—stand to gain substantial benefits from the merger. This is because the scheme has just over $3 billion in assets under management whereas the civilian schemes have approximately $18 billion in assets under management. There is clear industry experience that members of smaller superannuation schemes have the most to gain when their scheme funds are consolidated into a larger pool of funds.
All scheme members will also ultimately benefit from a highly skilled and innovative trustee being responsible for their superannuation schemes. This includes the ability for the single trustee, due to its increased presence in the superannuation industry, to attract and retain quality and experienced board members and staff.
Since last year, the government has undertaken consultation with military stakeholders on how the bill will affect members of the military schemes. While recognising that members of the MSBS in particular will benefit from the trustee consolidation, the government has also accepted many of the suggestions made by the ex-service community to protect the status of military superannuation. This includes a requirement for CSC to have regard to the unique nature of military service as set out in the relevant military superannuation legislation when it is performing a function under that legislation. I thank the ex-service community for their dedication to representing the interests of their members.
Both military and civilian interests will be represented on the 11-member governing board of CSC. The Chief of the Defence Force will be responsible for nominating two member directors and there will be consultation between the finance and defence ministers on suitable candidates for the five employer director positions. Three other member directors are nominated by the President of the ACTU.
The government has also responded to suggestions that there be a review of the first five years of the operation of the act. This will ensure the ongoing effectiveness of the single trustee arrangements.
Overall, the bill will better secure the superannuation arrangements for military personnel and Commonwealth civilian employees for the long term. It will also allow substantial benefits to flow to members, while retaining the individual scheme benefits and entitlements.
The bill reflects the government’s ongoing commitment to provide efficient and sustainable superannuation arrangements for Commonwealth employees and military personnel, together with its strong commitment to protect those features of military superannuation that recognise that military service is unique and different from civilian employment.
Debate (on motion by Mr Turnbull) adjourned.
Bill and explanatory memorandum presented by Mr Snowdon.
Bill read a first time.
I move:
That this bill be now read a second time.
The ComSuper Bill 2011 is part of a package of bills to improve and modernise the governance arrangements for the main Commonwealth civilian and military superannuation schemes.
This bill will establish ComSuper and provide that it is a statutory agency for the purposes of the Public Service Act 1999 consisting of a chief executive officer (CEO), as head of the agency, and staff. The bill will also provide that ComSuper will be a prescribed agency for the purposes of the Financial Management and Accountability Act 1997.
The bill will modernise the governance structure of ComSuper as a statutory agency, and clarify ComSuper’s functions. The government’s decision to improve superannuation administration was made with the aim of improving service levels for current and former members.
The function of the CEO will be to provide administrative services to the Commonwealth Superannuation Corporation (CSC), which will be established as the trustee of the main Australian government civilian and military superannuation schemes from 1 July 2011 by the Governance of Australian Government Superannuation Schemes Bill 2011. The CEO will be responsible for providing administrative services to CSC.
The CEO will be appointed by the Minister for Finance and Deregulation in consultation with the Minister for Defence.
Overall, the implementation of the bill will better secure the superannuation arrangements for Commonwealth civilian employees and military personnel for the long term. The bill reflects the government’s ongoing commitment to provide efficient and sustainable superannuation arrangements for Commonwealth employees and military personnel.
Debate (on motion by Mr Turnbull) adjourned.
Bill and explanatory memorandum presented by Mr Snowdon.
Bill read a first time.
I move:
That this bill be now read a second time.
The Superannuation Legislation (Consequential Amendments and Transitional Provisions) Bill 2011 supports significant reforms to the governance of Commonwealth superannuation that are included in the Governance of Australian Government Superannuation Schemes Bill 2011 and the ComSuper Bill 2011.
The bill makes consequential amendments to a range of other Commonwealth acts of parliament to take account of the changes to governance arrangements for Commonwealth superannuation schemes. It also puts in place transitional arrangements necessary for the reforms.
The bill amends the Superannuation Act 2005 to facilitate public sector employees being able to consolidate their superannuation savings under the management of one trustee.
Following consultation with ex-service organisations, the government has strengthened recognition of the unique nature of military service in the bill. In particular, the bill amends the Defence Force Retirement and Death Benefits Act 1973 to mandate the establishment of a dedicated Defence Force Case Assessment Panel by the single trustee, Commonwealth Superannuation Corporation. The establishment of the panel ensures the continuation of the role and function currently performed by the Defence Force Retirement and Death Benefits Authority—the DFRDB Authority—within the framework of the single trustee.
The bill requires the panel to have military representation. This includes representation nominated by the chiefs of each of the three services. The bill also prescribes the chair as being one of the directors of CSC who were nominated by the Chief of the Defence Force.
Debate (on motion by Mr Turnbull) adjourned.
I move:
That notices Nos 12, 13 and 14, government business, be postponed until a later hour this day.
Question agreed to.
Bill and explanatory memorandum presented by Mr Shorten.
Bill read a first time.
I move:
That this bill be now read a second time.
This bill amends various taxation laws to implement a range of improvements to Australia’s tax laws.
Schedule 1 amends the list of deductible gift recipients or DGRs in the Income Tax Assessment Act 1997. Taxpayers can claim income tax deductions for certain gifts to organisations with DGR status. DGR status will assist the listed organisations to attract public support for their activities.
This schedule adds two new organisations to the act, namely, the Charlie Perkins Trust for Children & Students and the Roberta Sykes Indigenous Education Foundation. The Charlie Perkins trust was established in 2002 in memory of the late Dr Charlie Perkins AO, and its purpose is to advance the education of Aboriginal and Torres Strait Islander people through the provision of scholarships to Indigenous people for study at overseas institutions, such as Oxford and Cambridge universities.
The Roberta Sykes Indigenous Education Foundation works to advance the education and life opportunities for Aboriginal and Torres Strait Islanders, and provides additional assistance to female Indigenous scholars undertaking programs overseas, such as assisting with the cost of relocating families and partners.
Schedule 2 amends the Superannuation Industry (Supervision) Act 1993 to allow regulations to prescribe rules in relation to investments in collectables and personal use assets by self-managed superannuation funds.
During the 2010 election the government committed to allowing self-managed superannuation fund trustees to continue to invest in collectables and personal use assets provided that they comply with tighter legislative standards. This commitment balanced the recommendations made by the panel of the recently concluded Super System Review, chaired by Jeremy Cooper, and concerns raised by the self-managed superannuation funds industry.
The amendments will allow the regulations to make rules relating to how self-managed superannuation fund trustees make, hold and realise investments in collectables and personal use assets. The purpose of the rules will be to ensure that these investments are made for retirement income purposes, not current day benefit. The content of the regulations is being developed in consultation with the industry.
The amendments will also remove a reference to a provision that was repealed on 24 September 2007.
Schedule 3 allows superannuation fund trustees and retirement savings account providers to use tax file numbers to locate fund member accounts without first using other methods and to facilitate the consolidation of multiple accounts.
These amendments will be subject to appropriate privacy safeguards.
This measure is a part of the government’s Stronger Super reforms, which I announced on 16 December 2010. Allowing for greater use of tax file numbers is the first of a number of initiatives from that package that will improve the administrative efficiency of the superannuation industry.
Regulations will be enacted to support the use of tax file numbers in facilitating the account consolidation process. This will include requirements for member consent and other procedures and processes that superannuation fund trustees and retirement savings account providers must follow before consolidating accounts.
In keeping with the current guidelines governing the use of tax file numbers, it will remain voluntary for individuals to provide their tax file number to their superannuation fund or retirement savings account provider.
Schedule 4 replaces the current mechanism for ensuring Australian taxes, fees and charges are not subject to the GST, with a legislative exemption.
The government’s decision to replace the current mechanism was announced in the 2010-11 budget on 11 May 2010.
This schedule replaces this inefficient system by amending the GST Act to allow entities to self-assess the GST treatment of a payment of an Australian tax or an Australian fee or charge.
Under these amendments, government entities will no longer need to have Australian taxes or Australian fees or charges listed on the determination in order for them to not be subject to GST.
Finally, schedule 5 includes minor amendments to the tax laws.
These amendments ensure that the law operates as intended by correcting technical or drafting defects, removing anomalies, and addressing unintended outcomes. These amendments are part of the government’s commitment to the care and maintenance of our tax laws.
This package also includes some legislative issues raised by the public through the Tax Issues Entry System, or TIES for short.
Full details of the measures in this bill are contained in the explanatory memorandum.
Debate (on motion by Mr Turnbull) adjourned.
Bill, explanatory memorandum and the report of the Committee for the Review of Parliamentary Entitlements presented by Mr Gray.
Bill read a first time.
I move:
That this bill be now read a second time.
Mr Speaker, the problems with the current parliamentary entitlements framework have been clearly documented.
The Australian National Audit Office in its 2009-10 report Administration of parliamentarians’ entitlements by the Department of Finance and Deregulation noted that the entitlements framework is ‘difficult to understand and manage for both parliamentarians and Finance’.
The report of the committee for the Review of Parliamentary Entitlements, known as the Belcher review, established in response to the ANAO’s report, similarly noted that the ‘existing arrangements are an extraordinarily complex plethora of entitlements containing myriad ambiguities’.
The Department of Finance and Deregulation recently engaged Ms Helen Williams AO, a former secretary of a number of Commonwealth departments, and former Public Service Commissioner, to review the administration of entitlements by the Ministerial and Parliamentary Services Division of the Department of Finance and Deregulation.
Ms Williams reported to the department in February 2011. Her review found that greater client focus and more effective administration by the department would be facilitated by a clearer and more integrated entitlements framework.
The administration, clarification and streamlining of parliamentary entitlements is an ongoing task that occupies a substantial part of my working life in this place, and I will continue to seek to improve, and make more transparent, both the framework and service delivery in this area.
It is important work, because it is critical to the enabling of members and senators—how we do our work representing our constituents in our system of representative democracy.
Parliamentarians that are supported by an effective, efficient and transparent system of remuneration and entitlements will do their jobs better. I am pleased today to announce an important initiative in the reform of the framework.
The bill I am introducing today will restore the power of the Remuneration Tribunal to determine the base salary of parliamentarians.
It will also allow the tribunal to determine the remuneration and other terms and conditions of departmental secretaries and the remuneration and recreation leave entitlements of other offices established under the Public Service Act 1999.
In restoring the tribunal’s power to determine the base salary of parliamentarians, the bill will implement the cornerstone recommendation in the report of the Committee for the Review of Parliamentary Entitlements.
The independent review committee was chaired by Ms Barbara Belcher AM, and comprised the current President of the Remuneration Tribunal, Mr John Conde AO, the current Dean of the Australia and New Zealand School of Government and former Commissioner of the Australian Competition and Consumer Commission, Professor Allan Fels AO, and Deputy Secretary of the Department of Finance and Deregulation, Ms Jan Mason. I thank them for their work.
The committee made a range of recommendations around parliamentary entitlements. The government has agreed to the cornerstone recommendation of the review. This bill implements this recommendation and by doing so will provide more transparency and—importantly—independence in the determination of parliamentarians’ base salary.
I now table a copy of the committee’s report for the information of members, and the public. As I have indicated, the government has agreed to the first recommendation of the report and is implementing it in this bill. I trust that the release of the report will be an important contribution to the broader task of reform of parliamentary entitlements.
Parliamentarians have been remunerated for their service to the Commonwealth parliament since Federation. Pay was initially set by the Constitution and then by the parliament itself, under the auspices of the Constitution.
With the enactment of the Remuneration Tribunal Act in 1973, the Remuneration Tribunal became responsible for setting parliamentarians’ base salary. However, the tribunal’s authority to determine parliamentarians’ base salary was removed by the Remuneration and Allowances Act 1990.
The bill restores the Remuneration Tribunal’s role of conclusively determining parliamentary base salary. This change will enable parliamentary base salary to be determined in its own right, rather than the current arrangement, where it is set by reference to a figure determined for another purpose, and a matter for decision by the government of the day.
The current situation has resulted in outcomes on parliamentarian’s salaries being determined by political considerations, to the detriment of considered and informed decision making on appropriate remuneration.
The government notes that Remuneration Tribunal determinations on parliamentarians’ remuneration were disallowed or varied by legislation in 1975, 1979, 1981, 1982, 1986 and 1990, prior to the passage of the Remuneration and Allowances Act 1990. Since this enactment, parliamentary base salaries have been determined by the executive arm of government.
The pre-1990 situation—where determinations were subject to regular disallowance—was also unsatisfactory. It was also inconsistent with the independent nature of the tribunal.
Accordingly, the government has decided that—in addition to the restoration of the Remuneration Tribunal’s power to determine parliamentarian’s base salaries—the tribunal’s determinations of parliamentary remuneration will, in future, not be disallowable.
This will reinforce the independence of the tribunal and ensure the integrity of the scheme for determining the remuneration of parliamentarians by removing—to the greatest extent possible—opportunities for intervention in the implementation of the tribunal’s determinations by the beneficiaries of those determinations.
The Remuneration Tribunal will continue to determine the additional salaries of parliamentary office holders, such as the President of the Senate and the Speaker of the House of Representatives, and provide advice to the government on the additional salaries of ministers and members of the executive.
To ensure openness and transparency of the Remuneration Tribunal’s decision making, the tribunal will be required to make its decisions public and publish reasons for them.
The bill also contains amendments to the Remuneration Tribunal Act 1973, and consequential amendments to the Public Service Act 1999, to make the Remuneration Tribunal responsible for determining a classification structure for departmental secretaries and related matters, which may include pay points and guidelines on the operation of the structure.
Those amendments implement the government’s 2007 election commitment to make the Remuneration Tribunal responsible for determining the remuneration of departmental secretaries and other public office holders under the Public Service Act 1999.
The Remuneration Tribunal will also be responsible for determining the classification to which each office of departmental secretary will be assigned and for determining the full range of departmental secretaries’ terms and conditions.
The Remuneration Tribunal would determine the amount of remuneration that is to be paid to the Secretary of the Department of the Prime Minister and Cabinet and the Secretary of the Treasury.
The Secretary of the Department of the Prime Minister and Cabinet would, in consultation with the president of the tribunal and the Public Service Commissioner, assign all other departmental secretaries to an amount of remuneration consistent with the classification structure determined by the Remuneration Tribunal.
As is the case currently with determinations made by the Prime Minister, the Remuneration Tribunal’s determinations of the remuneration and other conditions of departmental secretaries would not be subject to disallowance.
Consistent with these changes and the 2007 election commitment referred to above, the bill will also give the Remuneration Tribunal responsibility for determining the remuneration and recreation leave entitlements of the Public Service Commissioner, the Merit Protection Commissioner and the heads of executive agencies created under the Public Service Act.
The measures contained in this bill restore independence and transparency to the remuneration of parliamentarians, departmental secretaries, and the other office holders I have mentioned.
I commend the bill to the House.
Leave granted for second reading debate to continue immediately.
I thank the minister for outlining the history of the tribunal in such a detailed fashion and the history of the attempts over the years to make the process of determining the salaries of members and senators of the parliament more transparent. He has outlined where such attempts have failed in previous years and has brought forward this bill which will give true independence to the tribunal.
I think many people would remember the headlines which often appear in the papers after a determination that members of parliament vote upon their own payment. I think the idea that we have a tribunal that is free of political process to make these determinations is a fair way to go, and an improvement on the current system. It is quite interesting for people to realise that members and senators are not employees in the sense that people normally understand that term. For instance, there are no holidays for members and senators. There is no long service leave, no workers compensation and no penalty rates. There is none of the entitlements that employees in the ordinary sense think of as being part of their remuneration. So the way the tribunal will go about its business will be to take all those things into consideration when it makes its determinations, and do that in a way that does not have any political connotations.
I think it is also important to note that this bill is restoring the situation where the determination of the tribunal will no longer be subject to tabling and disallowance. It is also interesting to note that a new system will be invoked under the Public Service Act for the determination of the classification of departmental secretaries and that special provisions will be made for the tribunal to deal with the Secretary of the Department of Prime Minister and Cabinet and the Secretary of the Treasury.
I think there is always an important nexus between the remuneration of members and senators and the remuneration of the Public Service. I have recollections of situations where you could end up as a minister, and the secretary of your department was being paid an enormous amount more than you—yet your head was on the line every day. Be that as it may, I think it is appropriate that the tribunal has responsibility in that way. Again, that will not be subject to a disallowance motion.
The opposition is in support of the bill. I think it is a framework that has been outlined very thoroughly and in good detail by the minister. There is no need for me to go through the facts as he has put them on the record. I simply say that I think he has done that well. We will, indeed, be supporting the legislation.
We are going to see the Belcher report. There has been much speculation and anticipation about what might be in there, how it might impact and the like. It will now become a public document and it will be considered, over a period of time, to determine what recommendations may be the right ones to enhance, in the words of the minister, the job that members and senators do for their constituents.
In this place we very often use words as people used to use swords or other fighting implements; we represent opposing points of views on so many things. It is necessary for us to stand up for those beliefs but it is also a most important part of our task that we look after the constituencies that we are elected to represent under our representative form of government. There is a degree and variety of work that members and senators have to deal with. Members, in particular, can run the full gamut of every issue that is relevant to anyone in their constituency. The issues can run from social welfare and taxation matters through to immigration matters. There can be complex issues dealing with legislation and there can be negotiations to take part in. The tribunal views all those aspects and says, ‘Here is an efficient system which will enable you to be the servants of the people,’ in the way that we believe that all of us should. I say that about each member and senator in this parliament. I know that all members in this House carry a heavy constituency load and have the interests of their constituents at heart. I see that this bill is adding to our ability to give that service as it should be given. In concluding my remarks I simply say that we will be supporting the bill.
I am pleased to speak to this bill today. The discussion that we have heard from both the minister and the shadow minister indicates that there has been a fairly long-lasting problem in relation t the determination of salaries and other aspects of political life. Independents, historically, have argued for greater transparency in terms of the way remuneration and other entitlements are granted to parliamentary office holders and others that come under the auspices of the Remuneration Tribunal. This bill is an important step forward in terms of creating that transparency and independence in terms of the way salaries and other entitlements are dealt with into the future.
I am pleased that the Belcher report will be available for members and the general public to look at, because there are a number of issues that have been outstanding for many years that both parliamentarians and the public have views on. We will have the debate that we have probably needed to have for many years as to the value of office holders, the work that they do in the community and in the parliament, and how that should be properly assessed and the value placed on it. So I support the general thrust of today’s bill that the Remuneration Tribunal be, in a sense, independent of the parliament in its capacity to determine base parliamentary salaries.
I also support the need for a wider discussion to take place, and I hope a number of these things are in the Belcher report—and I am fairly certain they will be—as to the benefits that parliamentarians receive when they leave the parliament. We need a wider ranging debate on such things as the Gold Card, which consumes an enormous amount of money for parliamentarians who do not serve the community any more, who have left the building. And if we are having a serious look at the value of parliamentarians in terms of their salaries and entitlements, we do need to have a serious look at the value and entitlements that others receive after they leave the parliament.
I would encourage all members of parliament, and the general public and the press, to have a close look at what is being suggested in the Belcher review. I have been looking forward to having a very close look at it myself. I do hope that there is a wider ranging debate than the one that has been put forward today. But I do support the general concept, and have for many years, that the determination of the worth of parliamentarians—their base salaries and the salaries of the various officers of the shadow ministers, ministers et cetera—should be independent, totally, of the capacity of the parliament to have any influence. So the reference to the tribunal to have that determination take place independently and transparently to the parliament is a good step forward and I would hope that the community would see it in that light as well.
I first saw the Remuneration and Other Legislation Amendment Bill 2011 when it was introduced a little over a half an hour ago, and for the first time in the 43rd Parliament we have had a bill that has been introduced and debated on the same day, as far as I am aware. I am concerned that the process of introducing and debating a bill on the same day removes our capacity as members to consider the provisions of the bill in any meaningful way. I do accept and thank the minister for having kept us up to date with his intentions in this regard over previous weeks, but that is a different thing to actually being able to consider the bill and its implications.
When it comes to the matter of politicians’ remuneration, that is, in my view, an instance where there should be the maximum transparency and opportunity for debate and opportunity to consider the implications of what this parliament is going to decide—especially when the thrust of the bill is to remove from this place, from the parliament, the ability to have any meaningful oversight on politicians’ remuneration. So I have grave concerns about the process and I do hope it does not set any sort of precedent for future debates. I am concerned that, when a higher standard perhaps should be applying in an area where there has been and continues to be public cynicism about the motives of politicians, there should be more debate about it rather than less.
I understand there are a number of particular areas that the Belcher report has proposed that do cause concern. One, for example, is with respect to the electorate allowance. I and other members of the Greens use our electorate allowances in the electorate. It is used for a variety of very important community functions, and we are concerned at the prospect of a tribunal now deciding that that might be rolled into base pay, without a proper case being made for that and without this place and the Senate having had a full opportunity to decide whether or not that is in fact a valid and appropriate thing to do.
On the matter of principle about whether or not a tribunal should be able to do something separately from parliament and parliament not having the ability to disallow it, the Greens do not support removing the role of the parliament in relation to tribunal determinations. Transparency and accountability demand that the parliament maintain oversight of such matters. Given that the Belcher review has only just be made available and that we are being asked to vote on this matter now, we do not have the opportunity to properly consider the rationale for removing the role of parliament in this way. I understand that we are in a distinct minority, but at this moment we are not in a position, especially given such short notice, to support the bill at this stage. We will engage more fully on it when it comes to the Senate, but it is of grave concern that such an important matter is being put through so quickly.
in reply—I thank all of those who have contributed to the debate on the Remuneration and Other Legislation Amendment Bill 2011. In particular, I thank the member for Melbourne for his observations. I would like to say that the philosophy that underpins this bill is that the beneficiaries of remuneration decisions should not be the determiners of those decisions, and therefore the government stands by its commitment in this bill to provide an independent process. I thank the member for his contribution and I make the assumption that further discussion and debate will occur on this matter in the other place.
This bill will restore the power of the Remuneration Tribunal to determine the base salary of parliamentarians. It will also allow the tribunal to determine the remuneration and other terms and conditions of departmental secretaries and the remuneration and recreation leave entitlements of other officers established under the Public Service Act 1999. In restoring the tribunal’s power to determine the base salary of parliamentarians the bill will implement the cornerstone recommendation in the report of the Committee for the Review of Parliamentary Entitlements. This will provide more transparency and, importantly, independence in the determination of parliamentary base salaries.
I have tabled a copy of the committee’s report for the information of members and the public. The report is an important contribution to the broader task of reform of the system of parliamentary remuneration and allowances. The bill also provides that, in addition to the restoration of the Remuneration Tribunal’s power to determine parliamentarians’ base salaries, that tribunal’s determination of parliamentary remuneration will in future not be disallowable. This will reinforce the independence of the tribunal and ensure the integrity of the scheme for determining the remuneration of parliamentarians by removing, to the greatest extent possible, opportunities for intervention in the implementation of the tribunal’s determinations by the beneficiaries of these determinations. To ensure openness and transparency of the Remuneration Tribunal’s decision making, the tribunal will be required to make its decisions public and publish reasons for them.
The bill also contains amendments to the Remuneration Tribunal Act 1973 and consequential amendments to the Public Service Act 1999 to make the Remuneration Tribunal responsible for determining the classification structure for departmental secretaries and related matters, which may include pay points and guidelines on the operation of the structure. These amendments implement the government’s 2007 election commitment in this regard. As is the case currently with determinations made by the Prime Minister, the Remuneration Tribunal’s determinations of the remuneration and other conditions of departmental secretaries would not be subject to disallowance.
The measures contained in this bill restore independence and transparency to the remuneration of parliamentarians, departmental secretaries and other office holders that I have mentioned. As I said earlier, the system that sees parliamentarians supported by an efficient, effective and transparent system of remuneration and entitlements will allow them to better do their jobs. The measures in this bill are an important step towards that goal. I commend the bill to the House.
Question agreed to.
Bill read a second time.
Message from the Governor-General recommending appropriation announced.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
It might suit the convenience of the House for me to update members, as I said earlier today that I would, on potential sittings this evening. It might also suit the convenience of the staff of the parliament.
The government is waiting to receive back from the Senate legislation relating to the National Broadband Network. It is likely that we will have to sit beyond five o’clock this afternoon. I have informed members as soon as possible. I have just had a meeting with the Leader of the Government in the Senate, Senator Evans, and the Manager of Government Business, Senator Ludwig. It is the case that that legislation does need to be returned here because it will likely have amendments that need to then be supported through the House of Representatives. There are commercial issues, obviously, relating to the National Broadband Network of why that needs to happen in a timely manner.
It is certainly my position as Leader of the House—and I know the Acting Manager of Opposition Business shares the view—that the sooner we can depart from here in terms of sticking to the schedule the best for all concerned. I am aware, obviously, that people make arrangements, including arrangements tomorrow. It would be in everyone’s interest if people were able to depart Canberra tonight, if possible, and certainly that is what the government would like to see happen. Perhaps those with some influence with some senators might like to encourage them to deal with that legislation in a timely manner in the interests of the parliament and in the interests, indeed, of the workforce in the parliament.
As soon as I get an update from the Senate, I will report back. I will certainly report back just prior to question time, because I am aware that people have schedules, bookings et cetera. For the convenience of the House, I will do my best endeavours. I thank the opposition for their cooperation on these issues.
On indulgence: the opposition appreciates the advice that the Leader of the House has provided. We look forward to further advice. I can only say to him that, as we both know, the other place sometimes operates in a different way.
I present the report from the Publications Committee sitting in conference with the Publications Committee of the Senate. Copies of the report have been placed on the table.
Report—by leave—agreed to.
Bill returned from the Senate with amendments.
Ordered that the amendments be considered immediately.
Senate’s amendments—
(1) Clause 4, page 2 (after line 14), before subclause (1), insert:
(1A) For the purposes of this Act, a person takesgenuine steps to resolve a dispute if the steps taken by the person in relation to the dispute constitute a sincere and genuine attempt to resolve the dispute, having regard to the person’s circumstances and the nature and circumstances of the dispute.
(2) Clause 14, page 8 (lines 1 to 3), omit the clause.
(3) Page 11 (before line 3), before clause 18, insert:
17A Act does not exclude or limit law relating to disclosure of information, etc.
To avoid doubt, this Act does not exclude or limit the operation of a law of the Commonwealth, a law of a State or Territory, or the common law (including the rules of equity), relating to the use or disclosure of information, the production of documents or the admissibility of evidence.
I move:
That the amendments be agreed to.
Question agreed to.
I have received a message from the Senate informing the House that Senators Carol Brown and Cameron have been appointed members of the Joint Standing Committee on the National Broadband Network.
Debate resumed from 23 March.
with an addendum to the replacement explanatory memorandum, and I move:
That this bill be now read a second time.
In a globalised knowledge economy the skills of Australia’s workforce are critical to our ongoing economic success. We need to ensure that Australia’s vocationally qualified workers have access to the best training available to allow them to compete on a global scale. A key step to achieving this is becoming more nationally consistent and rigorous in the way we register, accredit and monitor courses and providers and the way we enforce performance standards in the vocational, education and training sector.
The bill establishes a National Regulator for the Vocational Education and Training (VET) sector. The establishment of a National VET Regulator is one of the most significant reforms to the sector in years. It has been achieved through strong cooperation between the Commonwealth, states and territories. It will improve the quality of Australia’s training systems and increase confidence in the skills of its graduates.
There have been several attempts in the past to harmonise the state based regulation systems. National standards against which training providers are regulated were introduced in the 1990s and model clauses for state legislation were introduced in 2002.
Despite these important reforms, the auditing and monitoring of provider performance still varies from state to state.
To address this, COAG agreed at its meeting in December 2009 on a new approach to national regulation. This approach includes the establishment of a National VET Regulator responsible for registering training organisations and accrediting VET qualifications and courses, and a separate Standards Council to provide advice to the Ministerial Council for Tertiary Education and Employment on national standards for regulation.
The introduction of this new approach to national regulation will build on the current quality and consistency in the VET sector and support the labour market and national productivity agendas by:
Specifics of the bill
The National VET Regulator will operate under a referral of powers from most states and will use its constitutional powers to operate in the two non-referring states of Victoria and Western Australia. Victoria and Western Australia, as the two non-referring states, have agreed to enact mirror legislation to ensure a consistent approach to VET regulation. The COAG decision agreed the National VET Regulator would regulate all international and multijurisdictional providers and the Commonwealth will use its constitutional powers to achieve this. Registered Training Organisations (RTOs) that operate solely in nonreferring states (and are not registered to deliver education to international students) will continue to have their activities regulated by those states.
The introduction of a National VET Regulator is strongly supported in the VET sector. Stakeholders across the board have supported this initiative including training providers, employers, industry skills councils and unions.
The Senate Committee for Education, Employment and Workplace Relations conducted an inquiry into this bill and the related bills and recommended that they be passed in their current form. The Senate Standing Committee for the Scrutiny of Bills also provided some comments and suggestions about this bill and the other related proposed legislation.
Despite the broad support for a National VET Regulator, some stakeholders have expressed concerns about the consultation process and some specific aspects of the bill. As this bill is part of text based referral of powers and the New South Wales parliament passed this bill as part of its referral late last year, amendments cannot be made to the bill without overturning that referral, and it is worth noting that the mirror bill was passed by the New South Wales parliament with the support of the coalition. However once this bill is passed by the Commonwealth parliament in its current form, the Commonwealth can then amend it without impacting on the referral powers from New South Wales.
The government therefore agrees with the recommendation of the Senate committee to introduce further legislation to amend clauses 61 and 62 after passage of the bill and its related legislation to avoid any constitutional issues. In addition, the government has amended the explanatory memorandum and provided an additional addendum to clarify points raised by that committee and the Senate Scrutiny of Bills Committee.
The government remains committed to establishing the National VET Regulator on 1 July 2011 and therefore is committed to the passage of the bills associated with this this week. To further ensure that any remaining stakeholder concerns are addressed, the Minister for Tertiary Education and Employment has asked his department to hold a consultation process with stakeholders through April and May this year. This consultation process will allow amendments to the act to be identified and considered before the government introduces an amending bill in August 2011.
These amendments would include a number of those identified in the Senate committee report, including:
This consultation process would also be an opportunity to seek agreement with stakeholders on the NVR’s approach to risk management in the VET sector and the standards that would apply, noting these standards are endorsed by the ministerial council, with the aim of aligning arrangements between the NVR and TEQSA, the authority.
In response to these commitments, the TAFE Directors Association, which represents TAFEs around the country, issued a statement supporting the passage of the bill in its current form. The association representing private training providers has also issued a statement calling for the bill’s passage.
In addition to the support of the training sector, this bill also has had broad support from industry stakeholders, including the Minerals Council, the Master Builders Association and many others.
This is an important initiative for the future of the vocational education and training sector and reflects the government’s commitment to ensuring that high-quality training is delivered to both domestic and international students. I commend the bill to the House.
Debate (on motion by Ms Ley) adjourned.
Consideration resumed from 23 March.
I present the explanatory memorandum to this bill and I move:
That this bill be now read a second time.
The National Vocational Education and Training Regulator (Transitional Provisions) Bill 2010 allows for the transfer of existing registrations, applications and other matters from state regulators to the National VET Regulator with minimal additional burden and disruption to existing RTOs. Further provisions to allow the smooth transition of staff, files, information and outstanding legal matters from state regulators are also contained in the bill. This will ensure that there are no gaps in regulation and that decisions made by state regulators will continue to apply until the national regulator is able to review them.
This bill ensures that there is a sensible and balanced approach to the transfer of responsibilities, which serves the interest of current regulatory staff and registered training organisations without prejudicing the regulation of the sector.
I present the addendum to the explanatory memorandum and commend the bill to the House.
Debate (on motion by Ms Ley) adjourned.
Consideration resumed from 23 March.
I present the explanatory memorandum and I move:
That this bill be now read a second time.
The National Vocational Education and Training Regulator (Consequential Amendments) Bill 2011 contains amendments that are required to ensure that the new regulatory framework interacts properly with other regulatory frameworks and funding programs and will amend the Education Services for Overseas Students Act 2000, the Higher Education Support Act 2003 and the Indigenous Education (Targeted Assistance) Act 2000.
Specifics of consequential amendments
The amendments to the Education Services for Overseas Students Act 2000 will make the National VET Regulator the designated authority for VET providers registered to deliver VET courses to overseas students. This will allow the National VET Regulator, among other things, to investigate breaches of the national code.
The amendments to the ESOS Act will also allow the government to incorporate nationally agreed English Learning Intensive Course for Overseas Students (ELICOS) and foundation program standards through legislative instrument to ensure national consistency and to protect international students.
Amendments to the Higher Education Support Act 2003 will ensure the administration of the VET FEE-HELP Assistance Scheme can work effectively with other Commonwealth regulatory frameworks, in particular with the National VET Regulator. For example, the amendments will allow the sharing of information from the relevant VET regulator, including the National VET Regulator and registering bodies in non-referring state jurisdictions for the purpose of deciding whether to approve a body as a VET provider, or to revoke or suspend a body’s approval.
I commend the bill to the House.
Debate (on motion by Ms Ley) adjourned.
It gives me pleasure to rise today to speak on the National Vocational Education and Training Regulator Bill 2010 [2011] and related bills. At the outset, may I say that the coalition does not support the passage of these bills. The Minister for School Education, Early Childhood and Youth spoke of broad support from industry training organisations and stakeholders. The coalition also support the establishment of a national VET regulator in principle—no argument with that. However, particularly in light of the coalition senators’ dissenting report following the Senate Education, Employment and Workplace Relations Legislation Committee inquiry into the bills, we have grave concerns about this process and whether it will truly produce a national VET regulator that achieves the results that were described by the minister in such glowing terms. As I said, we in the coalition are broadly supportive of this concept. Ensuring that, across the board, vocational education and training, VET, is of a high standard will be critical to progressing Australia’s productivity into the future. We acknowledge the need for a consistent approach to provide regulation to boost the quality of a sector that has come under much fire of late.
Given that there are approximately 4,500 registered training organisations across Australia, with many of these operating across borders, it is easy to understand the motivation behind a national regulatory system. While states have the primary responsibility for the funding of VET and subsequent responsibility for the regulation of these providers, there has been a significant shift from a strictly state based environment. Given Commonwealth funding initiatives such as the highly popular skills vouchers offered by the former coalition government, there has been a further shift towards more Commonwealth influence in the VET sector. Certainly, Australia faces critical skills shortages, especially in VET qualified staff. A national approach to the sector therefore makes sense. However, for a national VET regulator to ultimately achieve its objective of national consistency, the states must refer their powers to the Commonwealth and, in turn, cease their own regulation.
We have certainly seen an emphasis by the present government on a COAG approach and the consequent referral of powers from the states to the Commonwealth, and it is not difficult to see why this makes sense from a Commonwealth regulatory perspective or, indeed, any other Commonwealth perspective. But one must also understand that, in referring powers, states take very great care. No independent jurisdiction wants to give up its constitutional right to anything without having caveats in place and being absolutely convinced that it will work in the interests of that state. I believe that that referral situation is where this bill comes undone.
All the states have indicated that they are supportive of a national VET regulator. However, the model proposed presents stumbling blocks for both Victoria and Western Australia. While there is in-principle support from other states, there is also no definite time line for the referral of their powers to the Commonwealth. Queensland, South Australia and Tasmania have made little more than a vague overture to refer their powers some time within the first year of the national VET regulator coming online. In the meantime, they will continue to operate their own state regulatory bodies alongside the national model—sort of a ‘try before you buy’ approach. Given that we have two states that have such serious concerns about the design of this regulator that they are unwilling to refer their powers to the Commonwealth and the other states are yet to officially commit to referring their powers, one has to question just how national the system is or would be in the future.
Education is our fourth largest export; yet, for Australia to show the international community that we have a world-class VET sector and have acted to raise the bar, we also need to show that we are taking a serious and well-thought-through approach to its regulation. This National VET Regulator Bill does not achieve that.
The coalition do acknowledge that some providers of education services for overseas students, ESOS, have been in the media for all the wrong reasons. We are committed to ensuring that Australia regains its reputation as a provider of high-quality education offering a safe environment to those who would come here to study. Whilst we agree that a national VET regulator would be beneficial in addressing issues surrounding providers being established solely to provide a residency pathway or those who fail to train students to a satisfactory standard, we believe that the government’s inability to get a sign-on from all the states will diminish the status of the national VET regulator to such an extent that it will be little more than window-dressing—and it will be expensive window-dressing at that.
The financial implications, as provided by the fabulous Parliamentary Library in its Bills Digest, indicate that funding was provided in the last budget—$105 million over four years—to establish national regulatory arrangements for the VET system including $92 million over four years for the establishment of the NVR and $10 million over four years for the establishment of the national standards council. Consistent with the explanatory memorandum, the information provided on the DEEWR website refers to a commitment of $55 million over four years, which will be in addition to fees received by the regulator for regulatory activities.
Though there might well be savings for the states from their referral of powers and functions to the national VET regulator, the apparently revised federal budget figures and the reported concerns by the VET Regulator’s interim chair raised questions about the adequacy of the VET Regulator’s funding to meet its stronger investigative and analysis functions. We have a VET Regulator that is already in train, that already has a significant allocation of Commonwealth money and that has a model that enables it to cost recover from the training providers and presumably the states. One should always be very wary of side-by-side, parallel regulatory cost-raising activities. Think of the training providers struggling to meet the daily costs and wanting to provide good-quality education, handicapped by two sets of regulators auditing with clipboards, talking about two different sets of standards and making sure that both are applied to. It is not painting the picture of simplicity and quality that it should be.
With the expectation of full cost recovery by 2014 and a fee structure for services yet to be developed and approved by the Ministerial Council for Tertiary Education and Employment, there has been speculation that fees in some states are likely to rise. There was early speculation that the reason Victoria may have refused to refer its powers was that it wanted to be confident there was to be adequate funding. We cannot endorse a process which is incomplete and which is as costly as this one.
In addition to these concerns, the Senate Standing Committee on Education, Employment and Workplace Relations Legislation Committee’s inquiry highlighted further areas where revision could improve the effectiveness and status of the VET Regulator. I refer to and quote from the coalition senators’ dissenting report, which homes in on the real concern, as I mentioned before, that the position of Victoria and Western Australia is that they would not refer their powers.
… the evidence presented to the committee is that the NVR Bills have the potential to undermine national regulation. While Victoria and Western Australia have indicated they are prepared to introduce mirror legislation in their state parliaments to give effect to this aspiration,—
And that is certainly the impression the minister gave in airbrushing over those issues entirely—
Western Australia has advised that it is unable to do so on the basis the NVR Bill as currently drafted:
The Western Australian evidence said:
Our position on this bill is that the December 2009 agreement made by our Premier at COAG on the regulation of VET has as yet not been sufficiently reflected in the bill as it currently stands. The Commonwealth legislation being considered by this committee falls short of that agreement and the state is, therefore, not able to keep its side of the agreement until it is honoured in the legislation.
So if we pass this bill we have no indication that Western Australia will pass mirror legislation because at the moment they have indicated that they do not like the look of this bill. I know the minister has just talked about amendments, but, what a messy process. Can I suggest that the consultation to occur with the sector in April and May—the minister has left the chamber—should have taken place already. This has been severely under consulted. There will be a dash out to the sector to consult in April and May, amendments are to be introduced into the parliament in August meanwhile the regulator starts work in July. There is enormous cost associated with it, a new regime is being established and we do not even know where we are with at least two of the states.
The Senate select committee was informed that Western Australia was given assurances that the national system would not result in the transfer of regulatory responsibility for state owned RTOs. The Commonwealth bill does not reflect the assurances given to the our Premier from the then Prime Minister at the COAG meeting in December that these reforms would not result in the regulatory takeover of state owned public providers, including Western Australian TAFE colleges. Of course the Western Australian government is going to take care with the regulation of its own TAFE colleges. It runs a very good TAFE system.
From the discussion that occurred at COAG, there was a clear understanding from the officials that were attending and the Premier that the undertaking was made that the Western Australian TAFE providers would not be party to the national VET regulations arrangements and it was on this basis that the Premier agreed to the recommendations made at that meeting. Western Australia has recommended the Commonwealth attempt to address these concerns through amendments to the draft legislation to ensure that the state retains responsibility for state owned RTOs. That is the position of Western Australia, it would appear. Again, the principle is supported but the methodology and the state of play at the moment is simply unacceptable.
Victoria also noted its concerns regarding potential implications for the regulation of apprenticeships. By exempting apprenticeship laws from override for some states but not Victoria, the clear implication of the bill is that Victorian apprenticeship laws—at least to the extent that they may affect national VET registered providers—are to be overridden. Again, no equivalent arrangements will be established by the National VET Regulator Bill to replace the state laws it displaces. This appears to create a substantial regulatory gap. When it comes to apprentices, the trades in which they are involved, the licensing of those trades and the confidence people need to have in the licensing regime—this really does open up a lot of holes in this legislation.
Victoria’s submission to the Senate committee echoes the view expressed by Western Australia that the draft legislation does not affect a best practice approach to national regulation. Victoria seeks to limit the scope of the national VET regulator through this bill to only those providers based in referring states. Non-referring states, Victoria and Western Australia, should retain responsibility for the regulation of all VET providers based in their jurisdiction, including providers that operate interstate and/or offer services to international students.
Victoria has consistently supported a nationally consistent approach to the regulation of the VET sector. In place of a practical approach to national regulation agreed by all six jurisdictions, the Commonwealth’s use of its powers to override states’ constitutional responsibility for education is inappropriate and undermines the federation. If that is the approach Victoria has here, I do not see that the consistency the minister speaks of is going to happen any time soon. Victoria recommended the Commonwealth seek to address the concerns through amending the bill to clarify that the legislation does not affect the authority of non-referring states to manage TAFE institutes and regulate apprenticeships.
The minister talks about amendments. I am not sure whether he talks about those amendments because the amendments that he sought to discuss a few moments ago reflect the concerns the Greens had in the Senate when this bill arrived a couple of days ago, and I believe they are quite a different set of concerns. So coalition senators and the coalition in general feel very strongly that more work needs to be done by the Department of Education, Employment and Workplace Relations to draft legislation which actually meets the requirements of the two non-referring states so that a truly nationally consistent VET regulator process can be presented to the parliament.
On the basis of the evidence heard, the coalition will not support this legislation. I want to emphasise that we do support a national VET regulator, but it does need to be properly designed. This is just another example of Labor rushing in boots and all, more focused on the big picture and omitting the minutiae in the process. That is why this bill is undercooked, underdone and needs more work. We urge the government to go back to the drawing board.
May I also say that a lot of time is spent on the government side in articulating various problems relating to skills shortages, regulation, interference and big-stick approaches, and it all hangs off the numerous COAG committees. To a certain extent with our system of Federation we are all stuck with that process when we want to get something nationally consistent, but we have to stop articulating the problems and actually do something about them. Instead of just telling the Australian people all about the skills shortages faced across the country, we have to take genuine, committed action to find policies that address those shortages, not allocate $105 million over four years to what is essentially a regulatory regime that is going to cost providers, and that means it is going to cost students; that is not even going to be national; and that is going to face, and already is facing, a very confused and muddled start. I would prefer that we saw government dollars and public policy allocated to something that produces real results on the ground.
I just have to mention this example from last week of an announcement in this area on ‘delivering skilled workers to the resources sector’. It is an 18-month apprenticeship training program for 1,000 workers—small, but I applaud it—with $200 million to fund targeted training projects for skills in critical demands. Again, that is small, but one would support the government’s efforts in that area. But I was a little bit surprised at a particular pilot promoted by the Minister for Resources and Energy, and that is for a Cairns based fly-in fly-out coordinator to be appointed to match job seekers with mining, construction and infrastructure projects. I went to the webpage of the minister for resources—I do not have the media release here—which was trumpeting this particular pilot project for a coordinator. I do not know how much the coordinator will cost or what type of secretariat support will be involved or what offices it might occupy. And who knows how big it might get. But one of its major jobs is to put airlines in touch with mining companies.
It is a preposterous suggestion that mining companies are not already talking to airlines about their needs when it comes to fly-in fly-out workers. In fact, when I went to Brisbane recently there were big signs everywhere saying ‘Direct flights from Brisbane to Broome’, so significant numbers of fly-in fly-out workers are going from Brisbane to Broome. That is just an example of what is happening because the marketplace responds to what is required. Where there are shortages of course that is indicated. But for this government to be appointing a Cairns based fly-in fly-out coordinator whose job it is to put the airlines in touch with the mining companies and try to find workers is nothing but a joke.
To return briefly to this bill, we invite the government to go back to the drawing board, as I said, and do the job properly. In the meantime, the coalition will not support the bill.
I rise to speak on the National Vocational Education and Training Regulator Bill 2010 [2011], the National Vocational Education and Training Regulator (Transitional Provisions) Bill 2010 [2011] and the National Vocational Education and Training Regulator (Consequential Amendments) Bill 2011. These bills aim to establish a national vocational education and training regulator to supersede the current state based model. The driving force behind this is to offer consistency across the states in the standards that are enforced and processes that are utilised in the regulation of the vocational education and training sector.
I support the intention of these bills but do not believe that this intent is being achieved through the proposed legislation. The frameworks established to support this regulator are inadequate, and this government should refer these bills back for further consultation so we can make sure the best outcome is achieved on this important issue.
Australia prides itself on being a multicultural society. To have incidents like Indian students being attacked and Chinese students taken advantage of by unscrupulous boarding house operators flies in the face of the standards we wish to share and the experience we wish visitors to have in our country. Regulation must be implemented in order to protect our national interest, but this must be done correctly, with the right supporting framework, based on a detailed standard of consultation. Strong regulation will help to protect the identity that we cherish, to support our nation’s journey towards greater sophistication.
When speaking on the therapeutic goods legislation amendment bill yesterday I referred to the great role played by our high-tech sector, and in particular by the pharmaceutical industry, and the huge benefit they provide to our economy through investment and employment and to our national health standards through research and development. This industry is just one example of the Australia we wish to create: a country that prioritises higher learning and welcomes those who wish to share that journey. The fully funded students who join us from overseas contribute significantly to our economy and also to the affordability of further education for our own domestic students.
In 2008-09 education contributed more than $17 billion to our export earnings. International higher education students generated a total value-add in the order of $9.3 billion. This is a very significant player in our economy and it is absolutely vital that we ensure the regulatory framework that monitors this sector is built on the right foundations. It has been estimated that each international higher education student studying in Australia contributes, on average, over $50,000 to our economy each year, with the majority of this spent on goods and services.
Many of those who come to our shores to study a certificate or diploma at a registered training organisation then pursue undergraduate or postgraduate degrees at our universities. As a nation, we have a duty of care to these students. Their total experience in our country will have flow-on effects on many levels, and we must ensure our system is regulated in the best manner possible.
An example of the disastrous situation that can occur without an adoption of this kind of duty of care is clearly evident in the electorate of Bennelong. Several weeks ago I joined a protest rally organised by a local group called MARS—Marsfield Against Residential Suffocation. This group brings together residents surrounding Macquarie University who have become increasingly concerned with the number of illegal boarding houses established to accommodate international students, with limited assistance from the university.
Many full-fee-paying students arrive in Australia with little awareness of their rights, and are taken advantage of by the operators of these illegal boarding houses. As a result we have witnessed as many as 15 students sharing a three-bedroom apartment, putting an incredible amount of strain on the supporting infrastructure and surrounding community.
Both MARS and my office have been public in our support of these students and their need for protection from these unscrupulous operators. In this regard, my colleague in the state seat of Ryde, Victor Dominello, introduced a private members’ bill into NSW parliament to provide council with greater inspection powers and to enforce much larger penalties on the illegal boarding house operators. This bill was taken off the table by the Keneally government’s decision to prorogue parliament early. However, with all going well for Victor and the coalition in Saturday’s election, this will hopefully be introduced as a government bill in the near future.
In support of this I have said in this place once before that it is my belief that universities should be obligated to offer reasonable and affordable accommodation to all first-year overseas students, providing them with a chance to establish themselves, to make friends and to understand the options and protections that are available to them. This simple effort as part of a broader duty of care would lead to untold benefits resulting from a much improved Australian experience.
This local example highlights the fundamental need to ensure that we get these bills right. The intended changes in these bills are to shift responsibility for vocational education and training regulation from the states and territories to the Commonwealth. This is a positive start; however, in order to achieve the desired results, these changes must be based on consultation and the agreement and cooperation of all the states. What point is a national system if some states do not participate, and retain their own state based regulatory arrangements?
It is almost comical that the government’s lack of consultation has led to a situation somewhat reminiscent to that faced by the founders of our Federation over 110 years ago. The COAG processes are designed to resolve these prior to the implementation of national schemes, rather than having rogue states operating under their own rules on issues as important as health and education. The serious concerns raised by stakeholders at the lack of consultation on these bills led to the referral of this legislation to a Senate committee, which received numerous submissions that raised the same uneasiness with this particular legislation.
The coalition remains broadly supportive of the intent of a national regulator, but to date New South Wales is the only state that has passed legislation referring their powers to this national body. Victoria and Western Australia have refused outright to sign up, citing concerns over the maintenance of responsibility for the regulation of their state funded training institutions. These are legitimate concerns that must be resolved before these bills are debated by this parliament.
Victoria is right to argue for consistency in the implementation of these bills, with the regulatory responsibility sitting alongside the funding responsibility, just as this government has argued for the proposed establishment of the Tertiary Education Quality and Standards Agency. The Victorian government has also raised concerns regarding the national standards being ‘vaguely expressed’. Perhaps this is a result of the rushed manner in which these bills have been introduced—a criticism shared by none other than the Australian Education Union. As a result of these concerns the uncertainty that is now rippling through the regulation of this important industry has led to a situation whereby the regulators in South Australia, Tasmania and Queensland will continue to operate alongside the national regulator until all the states reach agreement and they have time to catch up. During this time each state will still require their registered training organisations to maintain state registration. This situation is less than ideal, and the coalition is concerned about the doubling up of regulatory obligations as a result.
We urge the Gillard government to return to the consultation process so that the most effective model can be built for the development of this important body—leading to a truly national vocational education and training regulator that addresses the concerns of states, of unions and of all other stakeholders.
I will make some concluding remarks on the National Vocational Education and Training Regulator Bill 2010 [2011] and related bills. In doing so, I will table the addendum to the National Vocational Education and Training Regulator (Consequential Amendments) Bill 2011.
The Australian government has a strong commitment to improving the quality of vocational education and training. We recognise that skills are an absolutely crucial plank of productivity, and this government is committed to working together with stakeholders to ensure that students and employers have absolute confidence in the qualifications our system delivers. The fact is that vocational education and training will drive the sustainable economy of the future for small and large businesses right across the community.
The National Vocational Education and Training Regulator Bill 2010 and its supporting legislation will build on the current quality and consistency in the VET sector, and support the labour market and national productivity agendas by strengthening quality and confidence in the quality and consistency of assessment and training outcomes of VET qualifications.
The government has acknowledged the concerns that were raised by stakeholders and by members on the bills, and the government has committed to consult further with a view to introducing amending legislation in August. The government will also continue to work towards Western Australia and Victoria becoming part of the national system.
The fact is that as we stand here today there is strong support from all stakeholders for the establishment of a new national VET regulator. While the opposition has put forward many reasons to do nothing, the government believes that it is important to act now and to ensure that the momentum for change is not lost. Changes enacted by these bills represent a major reform in the approach to vocational education and training for the future, and I commend these bills to the House.
Question put:
That this bill be now read a second time.
Bill read a second time.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
by leave—I move:
That order of the day No. 17, private members’ business, Assisting the Victims of Overseas Terrorism Bill 2010—Second reading—Resumption of debate, be discharged.
I thank the Leader of the House for granting leave. If I may, very briefly, indicate to the House my pleasure and pride that, this morning, the Attorney-General moved a government bill in substantially similar terms to the private member’s bill which I have had before this House for some time. I want to congratulate the Attorney for the very constructive attitude that he has taken on this matter.
I thank the government for seeing sense on this subject. Perhaps it took a little longer to see sense than I would have liked; nevertheless, it is good that both the government and opposition have been able to come together on this important subject to try to ensure that Australians who are killed or injured as a result of terrorist acts are treated appropriately, in ways analogous to the victims of crime under state and territory legislation.
There is perhaps one outstanding matter, and that is whether the government bill, once it has gone through the parliament and been assented to, will have retrospective operation, whether the government will, in fact, use the bill to declare terrorist acts—such as the two Bali bombings, the two Jakarta bombings, September 11 and the London bombings—as it could, so that the victims of those bombings will receive the compensation available to them under the government’s proposed new act. I hope that will be the case. The government, as I understand it, is yet to determine that matter.
I go back to the beginning of these brief remarks: I thank the government, I appreciate the work that the Attorney and his department have done and I hope that this bill has a swift passage through the parliament.
Question agreed to.
Debate resumed.
The question is that this bill be now read a second time.
Question agreed to.
Bill read a second time.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Debate resumed.
The question is that this bill be now read a second time.
Question agreed to.
Bill read a second time.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Debate resumed from 23 February, on motion by Mr Bradbury:
That this bill be now read a second time.
The Corporations Amendment (Improving Accountability on Director and Executive Remuneration) Bill 2011 before the House today deals with a range of measures which further empower shareholders when it comes to the setting of executive remuneration policies for the company which they of course ultimately own. This bill implements a range of recommendations of the Productivity Commission review into the issue of executive remuneration in Australia which was released in January last year.
Throughout the debate the coalition has been vocal about executive remuneration and has consistently expressed support for measures which empower shareholders as owners of companies when setting remuneration for executives. Given this, I can state from the outset that the coalition will be supporting all but one of the measures in the bill. There is one issue on which we will be moving an amendment, and I will discuss that a little later.
The coalition understands the importance of these measures to Australian shareholders in providing transparency for the process of setting executive remuneration in Australian companies. The bill before us proposes changes to seven key areas of the Corporations Act 2001—an act I introduced into this place as the minister responsible in 2001. As a reminder to the House, we had to get a referral of power from the states to the Commonwealth for the Corporations Act. That was the first major referral of power from the states to the Commonwealth since the power for income tax during World War II. So there has only been one substantial referral of power—this a good education for you, Mr Bradbury—since World War II, and it was in relation to the Corporations Act 2001.
The seven key areas of these proposed changes to the act are of interest to the House. The first is the two-strikes test. The first provision strengthens the non-binding vote of shareholders on executive remuneration with the two-strikes test. These measures are designed to give some teeth to the non-binding shareholder vote in the first instance where a no vote of 25 per cent or more on the remuneration report is ignored by the board of directors. The remuneration report in the year following a no vote will require the company to provide an explanation of the board’s proposed action in response to the no vote and, in the instance where no action is taken, require the board to explain why no action has been taken.
The second strike occurs in the following year if a no vote is again recorded in relation to the remuneration report. When this occurs, the legislation requires there must be a vote to decide if the directors will be required to stand for re-election. This vote will require a simple majority to pass, and if passed the spill meeting must be held within 90 days. There is currently no existing provision within the Corporations Act which enforces action against a board that subsequently proceeds with a remuneration report where a no vote from shareholders has been recorded.
When the Productivity Commission recommended the two-strikes change in its review on executive remuneration late last year, it found that the current arrangements tend not to provide sufficient power to shareholders if they are unsatisfied with the company’s remuneration policies, sufficient incentives or consequences for unresponsive boards and incentives on companies to respond to shareholder concerns. So this will be a significant step forward for empowering shareholders. The coalition hopes these measures will indeed encourage further transparency in relation to remuneration reporting from boards and further accountability on behalf of directors when it comes to setting those remuneration packages.
The coalition will be moving an amendment in relation to the wording of the no vote. The intention of the amendment is to improve the representation of total shareholder views, because as the legislation stands it is possible for a no vote to be triggered against a remuneration report by less than 25 per cent of all available votes that can be exercised. We consulted widely on this, and the view is that it was wiser to deal with the issue through an amendment to the proposal before the House now. Therefore, we are going to look to adjust the wording in this provision so that the vote required is 25 per cent of all available votes.
The second key issue in this bill deals with changes relating to the use of remuneration consultants in determining directors and executive remuneration. As it currently stands, there are no provisions within the Corporations Act dealing with remuneration consultants. These changes largely relate to the disclosure of use of consultants as well as the approval process for engaging those consultants. The use of external remuneration consultants in the industry is widespread. The Productivity Commission’s report cited a survey which found 67 per cent of boards sought advice on remuneration for the position of chief executive officer. In another survey, 83 per cent of boards stated that they sought independent advice when negotiating contracts with CEOs. The new provisions contained within this bill relating to the use of consultants will be far reaching.
The first change relates to the approval process for engaging remuneration consultants. Such engagements will now need to be approved by the board or the remuneration committee of the company. This change ensures the independence of consultants engaged in providing assistance on remuneration settings for executives and directors. Where remuneration consultants have been engaged and the company that they are advising is a disclosing entity, remuneration consultants will now be required to declare that they are independent and that recommendations have been made ‘free from undue influence by key management personnel’. Effectively, the concern was that it would be the chief executive whose remuneration was to be assessed who would be engaging the consultants, thereby creating a potential conflict of interest for those consultants.
Companies’ remuneration reports will now be required to disclose information relating to the consultant. The company board will be required to state whether or not the advice provided by the consultant has been made ‘free from undue influence by members of the key management personnel to whom the recommendation relates’. These measures unequivocally ensure the independence of consultants engaged by companies in the setting of remuneration for those key individuals. That brings Australia into line with other key jurisdictions globally when it comes to the use of remuneration consultants. The coalition welcomes these changes.
The third of the seven measures contained within this bill relates to the prohibition of key management personnel and directors along with their closely related parties from participating in the non-binding vote on the remuneration report. This was a recommendation put forward in the Productivity Commission’s finding and will serve to eliminate the conflict of interest which exists when directors and executives, along with their closely related parties, vote on their own packages. The only exception to this will be where key management personnel hold proxies on remuneration resolutions and have been directed to vote on an absentee’s behalf. This recommendation will be supported by the coalition. It is a prudent measure which improves corporate governance through the removal of what should be an obvious conflict of interest.
The fourth measure contained within this bill relates to another recommendation, which was to prohibit directors and executives hedging their exposure to incentive remuneration. Currently, the law requires companies to disclose the policy relating to the hedging undertaken by directors and executives in relation to their remuneration. This new measure will prohibit the practice altogether. We will be supporting this measure as, from our perspective, the executive remuneration of key management personnel should be closely linked to their performance and the performance of the company they lead.
The fifth measure prevents companies from using the no-vacancy rule to block the election of new members to the board despite there being board vacancies. The Productivity Commission’s report stated that this change would: ‘enhance current arrangements to enable greater contestability by reducing unwarranted barriers to entry for non-board endorsed nominees, improve shareholders’ oversight and influence over board composition, and provide encouragement for boards to improve board accountability and transparency’. The coalition views these, at face value, as sensible but we do have some reservations. The reservations are obvious: if a board chooses to keep some positions vacant and have a smaller board than may be possible, then sometimes that is not a bad idea.
They can do that!
The parliamentary secretary at the table says that they can do that, but it will remain a grey area. I hope that the detail of the bill is enough to satisfy those who are in dispute over this matter. The boards will have to obtain approval from shareholders in the event that they wish to enforce a no-vacancy rule, which will in turn improve the accountability of the board. I think that is the provision that the parliamentary secretary was referring to. Having said that, there is still an area of concern—until the right person arrives, sometimes it is appropriate to have a vacancy on a board.
The sixth measure contained within this bill deals with the issue of cherry-picking. This is essentially the practice where proxyholders who are not the chair are able to pick and choose the resolutions on which they wish to exercise the proxies they hold. The Productivity Commission recommended that this be changed so that the proxyholders must exercise all their proxies for each resolution, in order to improve the transparency and effectiveness of shareholder voting on remuneration. Again we see that even though this is a very prescriptive measure there is some sense to it.
The final measure contained within this bill is one that will make the financial reporting process for companies less onerous. Hear, hear! This is a change to the remuneration reporting disclosures so that only key management personnel of the consolidated entity will need to be disclosed. Currently, there is overlap in the remuneration report disclosures and this measure will simplify the process for reporting purposes, and we support that.
These prescriptive measures would not be warranted if corporate Australia actually engaged in better self-governance. The general public are concerned about what they deem to be excessive remuneration. On the coalition side we welcome people who are incredibly successful and we welcome the fact that people are properly rewarded for success. There was a massive growth under the previous, coalition government in shareholder ownership numbers in Australia. Particularly through privatisation programs, we saw a massive number of ‘mums and dads’ investing for the first time directly in shares. The Labor Party started that process with the first tranche of the Commonwealth Bank. But it continued with the privatisation of the GIO and then a number of other initial public offers of government entities.
The second great moment of increase in the volume of shareholders in Australia came with demutualisation. I was a beneficiary of demutualisation, both at the AMP not long after the privatisation of GIO, and at NIB, which demutualised not so long ago. Thankfully, both times I immediately sold my shares; I do not think either of them have ever seen those prices again.
Having said that, we have seen the empowerment of Australians through investment in shares. In fact, governments, and our government in particular, have provided incentives. It was the previous Labor government that created dividend imputation, and that was an incentive for people to own shares. It was the coalition government that effectively halved capital gains tax. It was the coalition that abolished stamp duty on the transfer of shares. It was the coalition that gave the great bulk of Australians the opportunity to invest in shares for the first time through the privatisation of Telstra. The fact is that those opportunities to invest in shares, whether the shares go up or the shares go down, empower individuals and ensure they have a diversified asset base, apart from what would, for many people, be their own home.
We have seen very significant growth in superannuation. I heard the other day we now have more than $1.8 trillion in Australia in superannuation, which I think now makes us the country with probably the fifth- or the fourth-largest funds under management in the world. I understand we have just passed Canada, which is quite a phenomenal achievement. We welcome that; it is very important. With that massive change in the nature of everyday investors, the fact that more and more everyday Australians are investing in shares, the scrutiny of Australian companies is even greater.
And one of the great comparative advantages we have as a massive recipient of foreign investment is our regulatory stability. We will have debates across this chamber, and perfectly reasonable debates, about regulation and taxation and so on. I would think there will probably be a couple today in question time. But I would say to you, Madam Deputy Speaker, it is so vitally important that everyday investors can have confidence in the integrity of their investment. And that is why we need to have a strong, reliable and consistently enforced Corporations Act, and that is why we need to provide appropriate protections. Not too much, because there is a risk in life—from my perspective it is vitally important that people who engage in investment undertake risk, because that ensures that the investment is more prudent, as my colleague at the table, the member for Mackellar, would know. It is vitally important that with risk comes reward and that we do not overly tax the reward. That is a very important formula.
Having said that, we need to ensure that there is an appropriate minimum level of protection for shareholders and investors. And they have to believe that the directors are acting in the best interests of the company. Now of course that is one of the key pillars of the Corporations Act; directors have a fiduciary obligation to act in the best interests of the company. That of course includes best interests of shareholders. But at the same time there is growing anxiety on both sides of this House that remuneration of senior executives in Australia is at times removed from the reality that many people would expect. It is shareholders’ money. They are entitled to see their chief executives being paid whatever is appropriate. I cannot say with any certainty whether $100,000 or $100 million is appropriate remuneration. That is a matter for the shareholders.
But what we collectively agree in this place is that shareholders should be properly informed and that shareholders should be properly empowered. And if they have the information and they have the opportunity under the law to exercise their entitlement, to speak out about the remuneration of senior executives, then so be it. And that is why there is bipartisan agreement. There is concern. A number of my colleagues have—and I perfectly understand it—a concern that this is an additional layer of regulation, that at some point the regulation tsunami has to be stopped—and there is plenty of that at the moment. But where there is corporate governance failure, it is the responsibility of the parliament to step in.
I said something recently that a number of my colleagues on both sides of the House would not agree with in relation to women on boards. But as I pointed out in an opinion editorial in the Australian, we are concerned about corporate governance issues more generally. I do not want to be prescriptive about things. There is incredible reluctance that this parliament should go down the path of being prescriptive about remuneration or prescriptive about constitution of boards or about any area of the regulation of private enterprise. But where there is corporate governance failure in entities that have up to one or two million shareholders, those people need to be spoken for. It is about good corporate governance.
I have said this before publicly. I remember getting a phone call from Mr Kerry Packer. He pointed out a particular provision of the then new Corporations Act that he said was overly onerous in the appointment of directors. He was quite right; it was a heavily prescriptive provision. He said, ‘Son, it’s going to be very hard to get good directors when you have this additional regulation.’ I pointed out that he was right, but every time there is a corporate failure in Australia, the general public, the media, political opponents always call out for more regulation, not less regulation. There is no-one reminding people that you have to accept some personal responsibility for failure. If you invest in a company and the company falls over there is going to be some pain, but that is a risk you take in order to get the reward you want. Of course everyone wants to maximise the return and minimise the risk. That is the endgame. But we cannot continue to default to regulation to minimise the risk, because ultimately that regulation, once it becomes so onerous, diminishes the reward.
It is widely regarded throughout the investment community that the safest investment is a government bond. It might be in Australia, but there are some countries in the world where it is not such a good investment. In fact, I remember Mike Milken saying to me that he was told by the CEOs of the various banks in the US in the 1970s and 1980s: ‘You know, Mike, governments don’t collapse. They don’t fall over. That’s why it’s okay for banks like Citibank, Bank of America and others to lend money to governments, because, don’t worry, those bonds will never fall over.’ Mike Milken went back when they all did fall over. When South America started defaulting, he was buying the debt for 6c, 7c and 8c in the dollar and he was cleaning up, because governments do default. But the perception is that there is less risk associated with government investment. Therefore, there is inevitably going to be less reward. Although, again, if you want a modern equivalent, look at the bonds of Greece. The risk is higher, the reward is higher—certainly higher than Australia and a number of other jurisdictions.
Having said that, the bottom line here is: the government cannot continue to increase regulation, because it diminishes the overall reward associated with investment in the private sector. I think we need to be mindful of that whenever we come in here and, even in a bipartisan manner, support additional regulation on Australian business. The best way to support business is often for the government to get out of the way. But there needs to be some rules of the game. It is not much different to sport: if everyone knows the rules and the rules are fair and keep the game flowing, then it will be an entertaining game and everyone will enjoy it and more people will participate. But if the rules become so onerous or so confused or so open to misinterpretation, as I see in my beloved rugby from time to time with the scrum rule—you know what?—it is going to diminish the event. If we continue to prize Australian private sector enterprise, which we in the Liberal Party and the National Party are so dedicated to, then we have to find ways to reduce regulation, not to add to the additional burden.
On this occasion we are backing this initiative to give confidence to Australian shareholders that the remuneration-setting processes in Australian companies are true, fair and transparent. I remind the House that, when we going to committee, we will be moving an amendment in relation to the wording of the no vote, which occurs in the two-strikes test. Otherwise, and bearing in mind what I said before—that this is additional regulation that we are a very, very reluctant to support but we are supporting it for the reasons I have outlined—I commend the amendment bill to the House. I commend to the House the amendment we will make at a later time.
Corporate reform encourages innovation and entrepreneurship, and Australian corporations such as Qantas and Billabong, Westfield and CSR have had a long history contributing to the nation’s prosperity and continue to underpin our economic growth. Great managers are critical to business success. At their best, successful managers create jobs and ensure that employees have rewarding careers. The job of politicians is to ensure that we continue to attract great managers, including some from overseas, yet to make sure that pay does not become detached from performance.
When I speak with my electors, their concerns are not primarily about pay packets but what that great social commentator Mark Knopfler called ‘money for nothing’. It is fine to be well paid if you are delivering, but golden handshakes, salaries that encourage excessive risk-taking and pay packets that go up merely because the entire stock market is rising are what worry Australians. As my electors say to me, ‘If the firm is underperforming, why should the boss get a pay rise?’
From the late 1980s onwards a number of high-profile collapses dominated the headlines. Overseas we had Enron, WorldCom, Lincoln Savings, EIEI and BCCI. In Australia we had the HIH Insurance Group. In too many of these cases lavish remuneration was a feature of the way the company was managed. Just before Enron’s collapse, Kenneth Lay, as chief executive, was one of the highest-paid executives in the US, earning $5 million a year. Although the Labor Party is a party that has fought for higher wages, it is a failure of corporate governance if such compensation is detached from performance.
In Australia we have seen a steady growth in CEO salaries which has outpaced salaries in the broader community. According to the Productivity Commission and its report, Executive remuneration in Australia, over the period 1993 to 2009 the average earnings of CEOs in the top 100 Australian firms rose by an average of 7½ per cent per year. Over the same period, average salaries across the economy rose by an average of 3.7 per cent a year. In 1993 the average earnings of a CEO in a top 100 Australian firm was about $1 million. By 2009 this had risen to around $3 million.
We can go further back still and look at how these top earnings have changed over the long run of history. While I was at the Australian National University I did work with Tony Atkinson where we looked at how the income share of top income groups in Australia had changed going back to the 1920s. One way of looking at this is to look at the income share of the richest one per cent of Australians. That is a group who in 2007 had earnings of $197,000 a year or more. That top one per cent of Australians in 1921 had 12 per cent of household income. Then we saw a compression: we saw the top earners income share steadily drop until 1980, when that group had about five per cent of all national income. Then we saw a rise again until by 2007 the top one per cent had 10 per cent of household income, double they share in 1980.
We see an even starker pattern if we look at the top 0.1 per cent—the richest 1/1,000th of Australian adults. In 2007, this was a group earning $693,000 a year or more, and their income share of the Australian pie followed a similar trajectory. In 1921, they had four per cent of all household income. That fell till 1980 when they had just one per cent of household income. And then that income share rose again so that, by 2007, the richest 1/1,000th of all Australians again had four per cent of household income.
Too much inequality can cleave us one from another, and leave us a more fragmented society. It is an issue about which many Australians are, I think, rightly concerned. As the Parliamentary Secretary to the Treasurer pointed out in his second reading speech, it is important that our Australian remuneration system be internationally competitive, but it is also important that it is tied to performance—that executives are rewarded for the work they do and the value that they bring to their firms.
We should remember that executives need to be accountable to shareholders. Shareholders, of course, are the owners of the company. They are the ones who have placed their capital on the line. And it is appropriate that they have freedom to choose the executives they want and freedom, within broad limits, to set the appropriate remuneration.
A critical part of this reform is giving shareholders more say over how the pay of company executives is set. The government has been aiming to encourage shareholder engagement through transparent disclosure of how remuneration is delivered. Shareholders need to have the information to convey their views through the non-binding shareholder vote, and to hold directors accountable for their remuneration decisions.
Crises can test us. Sometimes in a crisis institutions are found wanting. And so it was with executive remuneration through the global financial crisis. Australia’s exposure to the global financial crisis was much smaller than that of the United States, due partly to our industrial structure and partly also to the rapid response by the Reserve Bank and by this government through its fiscal stimulus package. But the global financial crisis did highlight to us some of the issues around remuneration structures that focused too much on short-term results, that rewarded excessive risk-taking and risked promoting corporate greed. As I said, most Australians do not mind well-paid CEOs. What they worry about is CEO pay that is detached from performance.
With the legislation put to the House today, we will be empowering individual shareholders so that they have the muscle to take the fight to the institutional and directors’ associates. We are putting forward the ‘two strikes’ rule, where shareholders will be empowered to vote out a company’s directors if the remuneration report receives a consecutive no vote from a quarter or more shareholders at two annual general meetings.
As the parliamentary secretary has pointed out, once this second strike is triggered, shareholders will then be given an opportunity to vote on a resolution to spill the board and subject the directors to re-election. The spill resolution of course requires 50 per cent of eligible votes cast, as would be the norm with most resolutions in a board meeting. If that spill resolution is passed, then a spill meeting will be held within 90 days at which the shareholders will be given the chance to vote on the re-election of the directors, one by one. There have been concerns raised over this measure. But I would point interested members of the community to the extensive consultations that the Productivity Commission and this government have done, and particularly to the consultations around the threshold level of a 25 per cent no vote. The Productivity Commission chose that level on the basis that it was appropriate because it was in line with the 75 per cent majority required for the passage of special resolutions.
This bill also focuses on an issue around the independence of remuneration consultants. People have reasonably argued that, in the past, remuneration consultants have sometimes looked a little like the fox guarding the henhouse. We need to guard against a risk that remuneration committees will simply ratchet up pay one after the other. We need to create opportunities for remuneration consultants to bring the best objective advice as to appropriate remuneration to the company. It should be the case that remuneration consultants are able to confidently go to a company and suggest that the remuneration is too high. This ought to happen in more than a trivial number of cases, and I doubt that it presently happens in many cases.
The bill also contains measures to require boards or remuneration committees to approve the engagement of a remuneration consultant. Those consultants will be required to declare that their recommendations are free from undue influence, and they will have to provide their advice to non-executive directors or the remuneration committee rather than directly to company executives, who are themselves, of course, affected by the report.
In addition, boards will be required to provide an independence declaration stating whether, in their view, the remuneration consultant’s recommendations are free from undue influence. The board will then have to mention their reasons for reaching this view. The company will need to disclose in its remuneration report key details regarding the consultants, such as who the consultants were, the amount they were paid, and the other services that the consultant provides to the company.
Another important set of measures in this bill prohibits closely related parties from voting on remuneration. The bill will address conflicts of interest by prohibiting the company’s directors and key executives, or key management personnel and their closely related parties, from voting their shares in the non-binding vote on the remuneration report. Currently the Corporations Act does not prohibit key management personnel who hold shares in the company from participating in the non-binding shareholder vote on remuneration. This is in order to prevent both real and perceived conflicts of interest which can arise when key management personnel vote on their own remuneration packages.
The bill also prohibits the hedging of incentive remuneration, and that is, naturally, because the hedging of incentive remuneration is at odds with the rationale for incentive remuneration and can undermine the whole purpose for which companies put in place incentive remuneration. The bill also prevents the cherry-picking of proxies. Directed proxies must be voted—a reform which I certainly believe is long overdue.
Naturally, the bill has received considerable support from experts. Les Goldmann, the policy manager of the Australian Shareholders’ Association, said:
I don’t think that shareholders are going to use the power irresponsibly, I think shareholders will use the power very responsibly and only in cases where there is clearly something that the board and the shareholders think the board ought to be accountable for.
We do think the Government, in particular Minister Bradbury, have been very brave in pushing forward with this legislation and we applaud their efforts in that regard and I think that small shareholders and corporate governance area in Australia will be grateful for their efforts for many generations to come.
Stuart Wilson, former CEO of the Australian Shareholders Association, said:
At the outset there doesn’t seem to be an appetite from institutional investors for turfing entire boards. I don’t think it will come to pass. … However, I think the simple threat or embarrassment, or potential for that to happen, will see to it that there will be significant improvements on remuneration in the next couple of years.
He also said:
This has been a topic that’s been discussed ad nauseam for the last few years. The Productivity Commission had a lengthy consultation period—everyone got their say.
Alan Fels, former head of the ACCC, said of the two-strikes test:
This change will make a chairman more careful in making their original decisions about executive remuneration.
Ann Byrne, CEO of the Australian Council of Superannuation Investors, said:
We are pleased that the government has maintained a key recommendation of the Productivity Commission—a ‘two strikes’ test on remuneration reports. We believe that this test will only apply to a small minority of companies who have displayed intransigence and a lack of response to shareholders. Only those companies that continue to put up egregious pay propositions and blatantly ignore the views of a substantial group of shareholders should be concerned with these provisions.
The member for North Sydney wants less regulation generally, but he is unable to point to specific examples of where he would reduce regulation. Like the coalition’s position in the election that they would like to cut spending when their spending package had an $11 billion black hole, the coalition are all talk and no walk.
This bill, on the other hand, is in a great Labor tradition of promoting economic growth with an eye to equity. This bill recognises that capitalism requires checks and balances if innovation is to flourish. We on this side of the House, the party of true small-’l’ liberalism in Australia, believe in markets. Labor is the party that floated the dollar, cut tariffs, brought about major competition reforms and is now using market based mechanisms to price carbon and deal with dangerous climate change. But we also believe in an appropriate role for government. That is why we brought about fiscal stimulus when the global financial crisis hit. And that is why, with this legislation, we are empowering shareholders by providing appropriate checks and balances as a reasonable and sensible means of dealing with executive remuneration.
Debate (on motion by Ms Plibersek) adjourned.
by leave—We live in an era of globalisation, an era when what happens somewhere else in the world—not just in our own backyard—has important implications for our future. The eyes of the world in recent weeks have been glued to events in North Africa and the Middle East.
There has been tectonic change. A major fault line has shifted. But it all began with a single man. A little over four months ago a 27-year-old Tunisian man called Tarek Muhammad Bouazizi, a street vendor, set himself on fire in protest at the confiscation of his wares and his treatment at the hands of a municipal official. It was this act, and the response of his fellow Tunisians, that set in train a series of revolutions which have rocked the region.
These developments have implications for Australia’s national security interests, our national economic interests, our international humanitarian interests, and our consular responsibilities. We share the hope of peoples across the Middle East that these efforts will result in pluralistic democracies.
But this is not guaranteed, and there is a risk that instability will create more space for the operation of militant Islamist and terrorist organisations. The potential radicalisation of governments in some countries may have broader geostrategic impacts. We are also concerned about Iran’s ambitions in the region. And we are concerned about prospects for peace in the Middle East. We are concerned about the possibility of an increase in unauthorised people movements from the region to other parts of the word as a consequence of instability in this region.
There are also important economic factors that could impact our national interests. Oil prices are increasing. Further instability will continue to drive up these prices. Of course, we are also concerned about the safety of Australian citizens in areas of unrest and instability. It is for these reasons, these national interests of ours and these national values of ours underpinning democracy and its development in other states, that Australia has key interests and key values at stake in what unfolds now in the Middle East.
Libya
I would like to update the House on recent developments in the region. In Libya, the world has been shocked by the attacks of the Gaddafi regime on its own people. The United Nations Security Council took firm action through UNSC Resolution 1973 mandating ‘all necessary measures’ to protect civilians from threat of attack by the Libyan regime.
The council also authorised a no-fly zone. It also strengthened international sanctions. And the referral to the International Criminal Court by the United Nations Security Council of regime members under the earlier UNSC Resolution 1970 remains in force. The Australian government has welcomed both these resolutions.
Resolution 1973 was adopted as Gaddafi’s forces were poised to attack Benghazi, a city of over 700,000 people, and when Gaddafi himself declared that he would ‘show no mercy’—his words: he would ‘show no mercy’. This is not a small town; this is a large city—700,000 people to whom he pledged to ‘show no mercy’.
We avoided the butchery of Benghazi as a consequence of the UN Security Council resolution and the implementation of that resolution by member states. At least we have avoided it for now though the situation remains highly fluid. However, in recent days we have also seen Gaddafi’s forces attack the western cities of Misurata, Zintan and Yafran. Despite their protestations that there is a ceasefire in place on the part of the Libyan regime, there has been further tragic loss of life.
Air strikes by international forces are making progress in putting an end to these attacks. But the situation, I emphasise, is highly fluid. The operation underway is complex and it is operationally difficult. The Australian government remains gravely concerned by the humanitarian situation and prospects of it worsening.
In recent days, I have spoken with the Secretary General of the United Nations, Ban Ki-Moon; the head of the UN Office for the Coordination of Humanitarian Affairs, Baroness Amos; the UN High Commissioner for Refugees, Antonio Guterres; and the head of the International Committee of the Red Cross, Jakob Kellenberger.
Our concerns include the lack of access by these organisations to critical areas in Libya, food and medical supply lines, and safety for Libyans seeking to flee conflict areas. More than 320,000 people have fled Libya since mid-February.
The Australian government is doing what we can to assist this crisis. We have committed over $15 million and now stand as the third-largest donor overall, behind the United States and the European Union. We remain prepared to commit further as the situation unfolds. Libya’s future is uncertain.
The Australian government, together with our key partners around the world, have been united in our call for Gaddafi to step down. He has lost legitimacy, he has violated international law, he has turned on his own people. The goal of the UNSC-mandated intervention is protection of civilians. Enforcement of the no-fly zone is making progress. The UN has imposed an arms embargo and a range of sanctions. Australia has imposed our own autonomous travel and financial sanctions against the regime. The international community is working to cut off oil revenue flows to the Gaddafi regime and is freezing the overseas assets of its members.
The opposition movement in Libya is strengthening But further loss of life is, regrettably, likely. And again I emphasise: the days that lie ahead will be uncertain with many diplomatic and military challenges before us. This is the tragic consequence of Gaddafi’s brutality.
Egypt
Egypt is already undertaking the long and slow process of political reform. On Saturday Egyptians voted overwhelmingly in favour of amendments to the constitution which will broaden the field for presidential nominees. Significantly more Egyptians turned out to vote in this referendum than have in most elections in Egypt in past decades put together—a testimony to the commitment of the Egyptian people to remain engaged and active in the political reform process which now unfolds before them.
Egypt will undoubtedly need help as it undertakes this difficult process. Presidential and parliamentary elections are still to be held, and all are to be held by the end of September. Egypt also has a weakened economy will need assistance to recover.
Australia and the rest of the international community stand ready to support Egypt where it needs support most. We are already exploring assistance to Egypt in the areas of food security and agriculture and through various other programs of the World Bank. These were discussed in detail in my recent visits to Cairo, both with then foreign minister Abul Ghait and with his replacement, new foreign minister Nabil El Araby.
Australia stands ready to assist and we are seeking to do so in a coordinated fashion, both with the European Union through Baroness Ashton and through the non-EU states, the other democracies around our region and the rest of the world. We stand ready to assist as Egypt is at a critical turning point for its future.
Tunisia
Tunisia is also undertaking a breathtaking program of political and economic reform. During my visit to Tunisia earlier this month—the first ever, I am advised, by an Australian foreign minister—I reinforced to Tunisia’s interim government that Australia stands ready to support Tunisia as it moves to enhance the political, economic and social rights of its people.
What happens in Tunisia will have important symbolic value across the rest of the Arab world, as well as being of more than symbolic value to the Tunisian people themselves. This is where this people’s movement began, in Tunisia, how it therefore unfolds, with the institutional responses to the pressures for democratic reform from its people, watched closely by the other Arab states of the wider region.
I encouraged the important steps already taken by the interim government of Tunisia, including freeing political prisoners, allowing freedom of expression, and adhering to international human rights conventions.
Australia is already exploring areas to support Tunisia’s reform process including electoral assistance and in the area of dryland farming. I confirmed this in my meetings with the Prime Minister Beji Caid Essebsi and Foreign Minister Mohamed Mouldi Kefi during my recent visit.
Yemen
Australia is gravely concerned about the deteriorating political and security situation in Yemen. Rolling popular protests over the past two months have been met with a brutal response by the government of President Saleh, resulting in more than 70 deaths and hundreds wounded since January.
Australia condemns the large-scale use of lethal force against protestors and has continued to urge President Saleh and his government to exercise maximum restraint and to seek every means possible to achieve a peaceful resolution of the crisis through dialogue.
The resignations of senior government figures, including military commanders, government ministers and ambassadors in protest at the 18 March killings, and President Saleh’s subsequent sacking of his cabinet, underline the gravity of the political and security crisis facing Yemen.
Australia is concerned that recent efforts at reform announced by President Saleh’s government may have come too late and that the window for dialogue is fast closing. President Saleh has reportedly agreed to a plan put to him by an opposition member, which would see him step down at the end of 2011, and has committed to the implementation of constitutional and electoral reform. The main opposition is deeply sceptical of President Saleh’s commitment to reform and continues to demand his immediate resignation.
The deteriorating situation in Yemen has attracted wide international concern. The Arab League has condemned ‘crimes against civilians’ in Yemen and urged the Yemeni government to deal with the protestors’ demands peacefully. Canada, the United States, the European Union, Britain, France and the United Nations Secretary-General have all condemned the violence against protestors, calling on the Yemeni government to respect the right to peaceful expression of political opinion and to embrace reform.
This widespread concern reflects the clear strategic stake the international community, including Australia, has in a stable, peaceful and unified Yemen, in which the people of that country also have their say in the future direction of their government and their country. Yemen, a poor and populous country with few natural resources and a long history of tribal based conflict, faces a number of longstanding and major economic, social and political challenges.
Yemen is also one of the front-line states in the fight against terrorism. A politically stable and economically strong Yemen is essential for combating terrorism in, and emanating from, the Arabian peninsula. Yemen’s geography, poor infrastructure and tribal networks have enabled al-Qaeda linked terrorists to operate in and from Yemen for over a decade. Bombings in East Africa as early as 1998 had Yemeni links.
Prolonged political instability in Yemen has the potential to divert security forces from their efforts in countering terrorism and create fertile ground for the terrorist organisations there to flourish in the future. The absence of a well-functioning government will serve to further entrench the terrorists’ freedom of action and their possible enmeshment with opposition political forces. The task, therefore, of political reform in Yemen is needed. It is complex and compounded by longstanding operations within that country of internationally active terrorist organisations. But reform must proceed.
Syria
The Australian government is deeply concerned by ongoing clashes in Syria, in particular in the southern city of Dara’a. In recent days in Dara’a at least 10 people—and possibly many more—have reportedly been killed by security forces of the Syrian regime. Overnight, Syrian forces reportedly fired on demonstrators who had gathered in and around the Omari mosque in Dara’a. Unconfirmed reports indicate that at least six people were killed in this incident. As UN Secretary General Ban Ki-moon and EU High Representative Ashton have said, the use of such lethal force against peaceful demonstrators in Syria is unacceptable. Syrian authorities must exercise all restraint in responding to peaceful protest activity. Claims by Syrian authorities that the demonstrations are being perpetrated by armed gangs are just not credible.
Syria has been ruled under emergency laws since 1963. Understandably, the people of Syria are calling for greater freedom and for greater political reform. Australia supports peaceful efforts towards democratic reform in Syria as elsewhere in the Arab world and as elsewhere across the world. Australia, therefore, urges the Syrian government to respond to the legitimate aspirations of the people of Syria and to pursue a course of dialogue and reform with them.
Bahrain
Bahrain has returned to relative calm in recent days following the security crackdown against protestors last week under a three-month state of high safety declared by the king on 15 March. I spoke to the Bahraini foreign minister, Sheikh Khalid, on 20 March to register the Australian government’s concern about the recent violence against protestors and the denial of their right to peaceful protest. This followed my meeting with Sheikh Khalid on 8 March during my visit to Abu Dhabi for the Australia-Gulf Cooperation Council Foreign Ministers Strategic Dialogue. Noting the deployment of GCC security forces into Bahrain, I called for the exercise of maximum restraint by the authorities—these forces coming from a combination of Saudi Arabia, in terms of military forces, and the United Arab Emirates in terms of police forces—and their continuing commitment to a process of genuine and inclusive national dialogue towards further political reform.
I also suggested that Bahrain invite a global NGO, such as Amnesty International, to come in and inspect its activities if the international community is to maintain confidence in the actions of the Bahraini government into the future. Sheikh Khalid stated that the Bahraini government continued to pursue dialogue with the opposition and that the GCC forces were in Bahrain to protect infrastructure only and that physical policing of the Bahraini people would be done by the Bahraini forces themselves.
The security situation in Bahrain is also complicated by the actions of Iran in support of the Shia population in Bahrain—with Iran still publicly claiming Bahrain as Iran’s 12th province.
Middle East peace process
The Australian government remains concerned about prospects for the Middle East peace process. The Australian government condemns the bus bombing in Jerusalem on 23 March which killed one person and injured many more, as well as the recent rocket and mortar attacks from Gaza into Israel. There is no justification for terrorism of any kind. The government has also expressed Australia’s sincere condolences for the Palestinian civilians in Gaza killed on 22 March. Attacks on civilians are unacceptable under any circumstances, and the Australian government strongly urges all parties to exercise restraint and avoid a further escalation of violence.
Australia strongly supports a negotiated two-state solution that allows a secure and independent Israel to live side-by-side with a secure and independent future Palestinian state. Violence such as that seen in recent days undermines prospects for a negotiated two-state solution. Both sides must negotiate urgently on final status issues, and refrain from actions which undermine trust, including settlement construction and terrorist attacks, which are not helpful to the peace process. These matters have been the subject of a series of discussions I have had over the last three months with Israeli and Palestinian Authority leaders both in Ramallah and in Tel Aviv and Jerusalem.
Conclusion
Just as the beginning of these protests and revolutions could not be predicted, neither can their end. The future of the region is unclear. The people of Libya, Egypt, Yemen, Bahrain, Syria, Morocco, Algeria, Tunisia and other countries, have called for a better future—a future with greater economic opportunity, greater political freedoms and greater respect for human rights. The end result of their efforts is yet to be determined.
There are also risks that some leaders of political movements may praise the principles of democratic revolution only to obtain power and later move to suspend these democratic freedoms once obtained. Mindful of these risks, the process of political reform must nonetheless be embraced in response to the legitimate aspirations of the Arab peoples for democracy.
There are also risks that economic reforms will be slow to deliver prosperity, and the aspirations for better employment and higher wages will be slow to realise. While there is a common demand across the region for greater political, economic and social freedoms, the situation in each country will vary greatly. Each country’s democratic evolution will try and be different.
The Australian government hold that democracy is a universal principle, consistent with the provisions of the International Covenant on Civil and Political Rights of 1976. Australian diplomacy will continue to be active in the region—consistent with our national values, consistent with our national interests and articulated through the practice of creative middle power diplomacy.
These have been difficult and dangerous times also for Australian citizens living in the region—and I urge all of them to keep abreast of travel advisories both in the Middle East and elsewhere in the world, including of course in Japan. Our diplomats and consular staff have performed in the best traditions of the Australian foreign service. I take this opportunity in the parliament to commend each and every one of them, each of our ambassadors in the region and their associated staff for assisting with consular evacuations and ongoing liaison with Australian citizens, often in the most difficult, dangerous and complex of circumstances. These diplomats, these consular officials, are great representatives of Australia, and the House should commend them for their courage and their professionalism.
We face difficult, dangerous and unpredictable times ahead in the Middle East and beyond. The Australian government will remain seized of events as they unfold and will be active in our diplomacy in working with the rest of the international community to advance the interests of the peoples of the region and the great cause of democracy as well as assisting where we can in the legitimate economic needs and economic development needs of the peoples of the region.
I ask leave of the House to move a motion to enable the member for Curtin to speak for up to 19 minutes.
Leave granted.
I move:
That so much of the standing orders be suspended as would prevent the member for Curtin speaking in reply to my statement for a period not exceeding 19 minutes.
Question agreed to.
Historically, the Middle East has been of significance to Australia’s national interests. Since the late 19th century, when New South Wales sent a contingent to Sudan, that part of the world has been strategically important to Australia. That remains the case. Events in the Middle East and North Africa continue to unfold rapidly, and no-one can predict the outcome.
The past week has seen the United Nations Security Council endorse the imposition of a no-fly zone over Libya, which is currently beset by what some describe as a civil war, with forces loyal to Colonel Gaddafi in the west and opposition to Colonel Gaddafi centred in the east. The complexity of the situation within Libya has led to concerns about how the country will eventually recover from this crisis and what type of government will emerge if we assume that Colonel Gaddafi, the brutal dictator, relinquishes or is removed from power. That itself is uncertain. There are disturbing reports from within Libya that Colonel Gaddafi continues to direct forces against the civilian population of Libya, further revealing his true character and the utterly illegitimate nature of his rule.
The mission to establish a no-fly zone has been led by the United States, with the support of several other nations, including France and the United Kingdom. President Obama has made it clear that he expects NATO to take overall command of the military action as quickly as possible; however, there are concerning reports of differing views within NATO that have delayed that process. It is in the interests of maintaining the integrity of the United Nations Security Council resolution and the broader interests of the region and the world for the NATO allies to resolve any differences.
Having fought hard to establish a no-fly zone over Libya, the international community is facing the danger of becoming bogged down over the question of what comes next. I note the comments of Senator Richard Lugar, a key member of the United States Senate Foreign Relations Committee. He has criticised the Obama administration for embarking on an open-ended military campaign with no end game in sight.
Should Colonel Gaddafi refuse to cede power, which is increasingly likely, nations imposing the no-fly zone and those who advocated its imposition will face a difficult dilemma. Whilst he remains in control of military forces, Colonel Gaddafi is unlikely to accept short of complete control over the entire country and the rebels are also unlikely to accept any situation that allows Colonel Gaddafi to regroup. The deep fear is that Libya is heading for protracted civil war from which the international community will struggle to extricate itself.
According to STRATFOR Global Intelligence, Colonel Gaddafi’s forces are likely to retain considerable strength even without the armour or artillery destroyed by the air strikes. The westward advance of rebel forces will be slowed by Gaddafi’s army, which is likely to dig in around Libya’s urban centres. There has been little sign to date that the rebels have been able to form into an organised military force.
President Obama has said that Gaddafi must go. The United Kingdom Defence Secretary, Liam Fox, has said that Gaddafi himself was a legitimate target. It is clear from these statements that regime change is a tacit goal of the United States and the United Kingdom at least, although not expressly articulated in the United Nations Security Council resolution.
Without a clear sense of direction, the international community may find itself drifting towards the undesirable outcome where it has to consider supporting an autonomous region in East Libya. This would require not only an ongoing no-fly zone over Libya but considerable economic and military aid packages to a fledgling government. France has already taken a step down this path, recognising the Transitional National Council as the legitimate government of Libya. There are also concerns over the composition of the opposition.
Military intervention to protect civilians in Libya is also a matter of taking sides. According to STRATFOR, the international community is ‘supporting a diverse and sometimes mutually hostile group of tribes and individuals bound together by hostility to Gaddafi and not much else’.
Having gone into Libya, the international community must now decide in what circumstances and under what conditions it will get out. What is the exit strategy? The Arab League, having called for the intervention and with its support for the resolution being integral to its endorsement, must take a leading role in determining the outcome. The key challenges are faced by not only the nations imposing the no-fly zone but also those who strongly urged such action, including the Australian government and most particularly Foreign Minister Rudd.
While military action in Libya has dominated news coverage, another crisis has been rapidly developing in Yemen. Protests have been under way in that country since late January, with tens of thousands of people taking to the streets of the capital San’a and other cities. There had been ongoing violence between security forces and protesters; however, the situation escalated rapidly after more than 50 people were killed last weekend. This led to defections and resignations from within the regime of President Ali Abdullah Saleh, greatly increasing the potential for the nation to descend into civil war. There were reports of a tense stand-off between military units on the streets of the capital.
After weeks of refusing to countenance any transition from power, the President is now reported to have agreed to stand aside peacefully and has accepted a plan for that process that includes the formation of a national unity government, constitutional reform, electoral reform and presidential elections this year. It remains to be seen whether the majority of protesters will accept this agreement and whether they will leave the streets and allow the country to regain some semblance of normality.
Meanwhile, it is reported that Saudi Arabia’s government has urged President Saleh to leave, and the kingdom is helping to manage the transition, including the hosting of a conference for Yemeni tribal leaders, political party representatives and government officials. Against the backdrop of these negotiations there are reports of ongoing violence elsewhere in the country, with two protesters killed and nine injured in clashes in the southern province of Taiz.
Equally concerning are the reports that the Yemeni Houthi rebels, who have been in armed conflict with the government for years, have taken advantage of the disruption to take control of the northern province. At least 20 people have been reported killed in the fighting. The Shiah Houthi fighters are reported to have shot down a government MiG fighter jet during the conflict. Saudi Arabian security and military forces have also clashed repeatedly with Houthi forces over several years, and the Saudis have undertaken extensive military action against them along the Saudi-Yemeni border. This has included the bombing of Houthi strongholds in Yemen.
The situation within Yemen is volatile and unpredictable, and we continue to urge that calm heads prevail and a peaceful transition be achieved. It is not in the interests of the people of either Yemen or the rest of the world for the country to descend into chaos. That would only play into the hands of extremists. We must not forget that 23 former members of al-Qaeda escaped in 2006 from a Yemeni prison and founded al-Qaeda in Yemen, which later evolved into al-Qaeda in the Arabian peninsula. This group was behind the attempted bombing of a passenger jet over the United States on Christmas Day 2009. Al-Qaeda in the Arabian peninsula is regarded as one of the most dangerous and active al-Qaeda affiliates, and we must not doubt its ability to use the upheaval in Yemen to its own nefarious advantage.
The situation in the tiny kingdom of Bahrain remains tense in the wake of the decision of the government to demolish the Pearl Monument, around which protesters had gathered for weeks. While the crackdown that accompanied the demolition of the monument managed to clear the protesters, it appears that the situation is only temporary. There are reports that activists are planning for a day of protest tomorrow targeting at least nine locations, including the airport and the hospital. The kingdom is particularly volatile due to tensions between the 70 per cent Shiah population and the 30 per cent Sunni population who make up the ruling class and the royal family. A major concern is that the upheaval is being encouraged or worse by Iran and that Bahrain has become a proxy battle ground for influence between Saudi Arabia and Iran.
European Union foreign policy officials have warned of a downward economic spiral and an escalation in the proxy conflict between Iran and Saudi Arabia. Bahrain may be a small island kingdom, but its strategic importance is significant as the host of the United States 5th Fleet. Forces from Saudi Arabia are currently in Bahrain, ostensibly to protect key infrastructure, while Kuwait has deployed naval vessels to the kingdom for what has been described by Kuwaiti officials as ‘part of the peninsula shield forces defending Bahrain’. Given that there are now no external forces threatening Bahrain, this would indicate a desire to defend Bahrain from internal forces. The great fear is that, if the Shiah are successful in toppling the Sunni government in Bahrain, it would greatly enhance Iranian influence in the region and embolden Shiah minorities within the other countries of the region, most notably Saudi Arabia.
Disconcertingly for the West, the Shiah minorities of Saudi Arabia tend to live in the regions which hold the bulk of the nation’s enormous oil reserves. Unrest in those regions would send shock waves through the world economy. There have already been reports of small protests in Saudi Arabia with calls for the release of Shiah clerics and other prisoners. The world is watching developments in Saudi Arabia with great trepidation, revealing the sensitivities surrounding events in Bahrain. Nonetheless, we urge the Bahraini king to forsake armed crackdowns on his own people and to undertake negotiations in good faith to advance the cause of democracy and human rights in his tiny kingdom.
Unrest continues to ferment in other nations of the region. There are disturbing reports of deadly violence having been used against protests in nations such as Syria. There have been reports overnight of Syrian security forces shooting and killing four people near a mosque during a funeral for people who were killed while staging recent antigovernment protests. We continue to urge governments to show restraint and allow people to protest peacefully. The situation in Jordan also remains fluid after widespread protests led to the king sacking the government and replacing the Prime Minister on 2 February. Opposition groups are reportedly growing impatient at the slow pace of reform since that time. King Abdullah II has ordered the new government to act quickly in enacting political and economic reforms and is clearly worried about the potential fallout should the protesters lose faith in the process.
Egypt has taken significant steps as it emerges from under the fist of the Mubarak regime. Almost 80 per cent of Egyptians who voted in a recent referendum supported a range of constitutional changes, including limits on presidential terms. This is a huge step forward for a nation struggling to build new democratic institutions and to unify the nation after the dramatic events that ultimately led to President Mubarak resigning and then fleeing Cairo. Egypt is regarded as hugely influential in the region given its population and strategic importance, including the global economic significance of the Suez Canal. It is also one of the few nations of the region that has a formal peace treaty with Israel.
After Tunisia, where protests first erupted, Egypt was the first major nation to experience widespread protests and the first where those protests toppled the President. With Egypt taking what appear to be constructive and peaceful steps towards political reform, we must remain hopeful that other nations will be inspired by its example. It is too early to judge what will emerge as Egypt’s ruling structure following elections, and concerns linger about the Muslim Brotherhood, which is steadily taking a more prominent role. However, there is hope that the universal human desire for greater freedom which motivated the original protests will triumph in Egypt and in other nations.
I join with the foreign minister in commending the Australian consular staff for their professionalism and their calm approach to dangerous and devastating situations that have arisen in North Africa and the Middle East. People talk optimistically of an ‘Arab spring’, but the situation country-by-country is fraught with danger for the whole international community. It cannot be assumed that many of the participants in these protests and conflicts have the same respect for democracy, freedom, the rule of law and human rights that we so value.
Debate interrupted.
Registered clubs and hotels in Australia play a vital role as a link for the community. Clubs in my electorate nurture junior sport. They are a place for communities to meet and for returned servicemen to gather—they are a place where the community can socialise. The clubs and hotels in my electorate and right across Australia are under threat because of the gaming reforms being proposed by the member for Denison and supported by the Prime Minister in her desperate attempt to cling to power. I think it is a sad day for Australia when the millions of people who are members of registered clubs and users of hotels are held to ransom by the sanctimonious crusade of one member of parliament. What is even more tragic is that the Prime Minister and members on that side of the House and the Independents, who sit behind me, are going to support this person purely to hang on to power. They are going to sacrifice what is good for their communities; they are going to sacrifice junior sport; they are going to affect the welfare of ex-servicemen—purely to hang on to power and pander to the wishes of a very minor Independent member from Tasmania.
I rise to acknowledge the contribution of Professor Ian Chubb AC to the Australian higher education community over a three-decade career. Originally trained as a neuroscientist, Professor Chubb was a fierce advocate for the Australian higher education sector both in his role as Vice-Chancellor of the Australian National University and as President of the Australian Vice-Chancellors Committee. Known affectionately as ‘Chubby’ to ministers and even prime ministers, he was particularly vocal about the need for increased funding for universities. Professor Chubb was similarly unafraid of addressing big and controversial issues, calling for bold reform, not mere tinkering. He was direct, too. In 2009, when I was appointed an economics professor at ANU, it was a characteristically straightforward Ian Chubb who gave me the news in a phone call that went something like: ‘Mate, you’re a professor. Well done’—followed by hanging up.
Professor Chubb was rare among vice-chancellors in that he gained the respect and admiration of students, both undergraduate and postgraduate. His commitment to student income support and student organisations gained him many friends among students at the ANU and at other universities throughout Australia. My office manager, Louise Crossman, was a former ANU Students Association executive officer. She says, ‘He must have been pretty good because we never had any reason to occupy Chubb’s office, which was unusual and disappointing because I really wanted to occupy something.’
Professor Chubb was the well-deserved recipient of the ACT Australian of the Year Award in 2011. I wish him well in retirement and hope that he will continue to make a valued contribution to Australian public life.
Today I seek to table an in-order petition from the Take Action for Pumicestone Passage community action group. The group has collected, since 1 January, a staggering 13,555 signatures, requesting a strategic environmental assessment of the Pumicestone Passage and its catchments prior to the commencement of the Caloundra South residential development. The request is made in line with the Environment Protection and Biodiversity Conservation Act 1999. Overwhelmingly, the signatories live in the Caloundra area, so the development and the local Pumicestone Passage environment are obviously matters of major concern.
Bribie Island, just north of Brisbane, lies along the coast, creating the sheltered waterway of the Pumicestone Passage. This area is home to dolphins, dugongs, sea turtles and many other animals. The passage is also part of the Moreton Bay Marine Park. It would be a shame to allow such a key environmental area to be threatened by development.
The Sunshine Coast is a high-growth area, so we need new houses; however, development must be balanced with care for the environment. The Caloundra South development is a residential project of 2,360 hectares that is bordered by the Caloundra Airport, the Bruce Highway, Bellvista and Pelican Waters, and there is potential for 25,000 new houses to be built housing some 50,000 people.
The TAPP organisation is well organised. It wants to protect the local environment. The petition was presented to me last week by principal petitioner Alana Kirchhoff, TAPP spokesman Ken Mewburn and petition coordinator Helen Crook. This is a wonderful organisation. I will be meeting with the minister today to push the case of the petitioners. (Time expired)
The petition read as follows—
This petition is from concerned citizens of Australia and others from the wider international community.
We wish to convey to the House and Minister Burke our concern for the deteriorating health of the Pumicestone Passage, a RAMSAR listed wetland of international significance. This area already has documented evidence of environmental degradation. We believe that the proposed Caloundra South Development, of 25 000 homes, will have further significant impacts on the ecosystem of the Pumicestone Passage and its catchment.
We therefore ask the House to call upon Minister Burke to work with the QLD State Government to conduct a Strategic Environmental Assessment of the Pumicestone Passage and its catchments under the Environmental Protection and Biodiversity Conservation Act 1999. This Assessment should closely scrutinise all land use both current and proposed for its impact on the ecological health of the Pumicestone Passage and its catchment. We believe the Minister should then use the information gained to set mandatory environmental standards that will apply to all future development and any alteration of present land usage in this area.
From 13,555 citizens.
Petition received.
I am very pleased that next week the Prime Minister and cabinet will be coming to Western Australia and that a community cabinet event will take place in my electorate of Fremantle. This will be a very welcome instalment of this Labor government’s ongoing commitment to taking cabinet to all parts of Australia and to hearing from people all over the country in an open, laid-back and responsive manner. We should all take heart from the fact that the Prime Minister and cabinet ministers in this country are both able and prepared to hear from anyone and everyone in an open public forum.
Fremantle is a highly appropriate destination for a community cabinet because it is a place that is deeply engaged on some of the big issues that confront us all. It is a community that understands the threat of climate change and the opportunities that exist in renewable energy development. Indeed, the host venue, South Fremantle Senior High School, is striving to be Australia’s first carbon-neutral school, and the City of Fremantle was the second carbon-neutral local council in Australia.
Like Western Australia as a whole, the Fremantle electorate wants to see better health and mental health services; better transport and community infrastructure; and a lasting social dividend from Australia’s mineral resource development. All in all, Fremantle is a community that wants to get involved, a community that sees the bigger picture and a community that does not approach issues by asking, ‘What’s in it for me?’
We look forward to the community cabinet event, which I am sure will be robust, informed, passionate and good-humoured—because those are Fremantle qualities, and that is what Fremantle is about.
I rise to speak about North Queensland Community Transport in Townsville and the community of Townsville. The Townsville Online Tenders System has a fleet of 39 drivers, all volunteers, and to drive for North Queensland Community Transport they must all have first aid certificates. Unfortunately, North Queensland Community Transport were not able to pay for that because they are a totally non-profit organisation, so they asked me what I could do. I put out an email to all my associates and three people got back to me before I could do anything—the three large clubs in Townsville: the Cowboys Leagues Club, the RSL and Brothers Leagues Club. Craig Thomas, Joe Kelly and Karla Malouf said, ‘We will pay for the lot in one fell swoop. Then, if you let us know about every volunteer who comes through, we will ensure that everyone who drives for this valuable community service has a current first aid certificate.’ I think it is an absolutely wonderful thing to have done.
The value to the community of the clubs in Townsville is enormous. They provide jobs, cut-price meals and all that sort of stuff. They do many things for the community, including providing large amounts of money for sporting clubs. I just want to make sure that everyone knows how good these clubs are. It would be a shame if anyone ever did something to prejudice their position to be able to provide these valuable community services.
I take this opportunity today to speak about two young constituents from Throsby who have been selected to participate in the YMCA New South Wales Youth Parliament this year. Paige Mackander, from Oak Flats, is in year 12 at the Illawarra Grammar School and has been chosen to represent the state electorate of Shellharbour, which falls within the boundaries of the electorate of Throsby. Secondly, Blake Osmond is an outstanding year 11 student at the Illawarra Sports High School and, for the second consecutive year, is the successful candidate to represent the state electorate of Wollongong.
The YMCA New South Wales Youth Parliament, which convenes, for the 10th consecutive year, in 2011, is a highly prestigious forum for young people to learn about and participate in the parliamentary process. The youth parliament brings together young people from across New South Wales who are nominated and selected by New South Wales members of parliament to represent the young people of their electorate on issues of concern to them. Typically, these young people are high achievers academically, with a strong commitment to community services and a desire to make a real difference in the lives of residents in their electorates. They are passionate about making their local communities a better place in which to live and want to improve their skills in public speaking and leadership. I congratulate Paige and Blake on their successful selection to participate in the NSW Youth Parliament 2011. I foreshadow that one day down the track they, as leaders of tomorrow, may join some of us in this place.
Bennelong is fortunate to have an active Armenian community, proudly displaying their great heritage, including a mayor and a local councillor. An issue of great importance to this community is the lack of appropriate recognition of the genocide by the Ottoman Empire, tragically linking our two nations, as Anzac troops landed in Gallipoli at the same time just a short distance away. The world has turned many times since then and the Turkish people welcome us back each year to commemorate a tragedy that has formed such an important part of our national legend. I look forward to the day that the Turkish and Armenian people can build a similar bridge and come to terms with their own tragedy. To Bennelong’s constituents of Armenian heritage: I extend to you my full support, as you carry this burden that weighs so heavily on your collective conscience.
I would like to congratulate young Canberra engineer Adrian Thearle for winning the Australian Industry and Defence Network ACT Young Achiever Award. This award recognises the outstanding contribution Adrian has made to the defence industry. Employed by CEA Technologies, which is based in Fyshwick in my electorate, Adrian Thearle has worked on leading-edge radar technology for the Anti-Ship Missile Defence project for the Australian Navy. This allows our Anzac class frigates to find and track targets. This award is testament to Adrian’s ability and the support of CEA technologies, which has seen him rise from a junior engineer to the principal hardware engineer for the Anti-Ship Missile Defence project in only six years. The phased array radar system was designed in Australia with Australian expertise. It gives young people like Adrian the opportunity to build their skills and experience, which is good news for the Australian defence industry. I also wish to congratulate CEA Technologies for its commitment to supporting and encouraging young people in the defence industry. This is the second year in a row that a CEA employee has won this award. I wish Adrian well in his aspiration to one day provide his own locally designed and developed solutions to help our defence industry, our forces and those of our allies.
Today I would like to congratulate Tumby Bay District Financial Services Ltd, which will be opening a branch of the Bendigo Bank on Friday. I will be given the honour of officially opening it next week and I am looking forward to it. It has taken over 12 months. Kevin Cook, chairman; Julie Elliott, secretary; Wayne Branson, vice-chairman; and their committee have worked very hard over the last 12 months to get a commitment of about $900,000 from the district that will support and invest in Bendigo Bank. Bendigo Bank is given the ability to raise serious amounts of money. Over the last year, since Bendigo Bank was established, the community of Cummins—which is just over the hill from Tumby Bay—has reinvested $1.2 million back into the community. Having this pool of investment to go to government and say, ‘We’ve got some dollars on the table; what have you got?’ is a great advantage to the community. I expect Tumby Bay to have similar success and I think, over the next few years, this community endeavour will pay great dividends for Tumby Bay. I look forward to being with them next week.
On 10 March, along with the member for Chifley, I attended the launch in Blacktown of the Marist Youth Care’s highly successful Aboriginal Trainee Support Worker Program 2011, by the Minister for Indigenous Employment and Economic Development.
The program is now entering its third year, following an extremely successful retention rate of 81 per cent over the past two years. The program provides trainees with a recognised industry qualification and practical skills so that, when they become youth and support workers, they will be fully equipped to take up real jobs. As the minister noted, he has observed an amazing positive change in participants from the time they start the program to when they finish it. It is truly transformational. The Blacktown LGA, which falls across the electorates of Greenway and Chifley, has the largest Indigenous population in Australia for an urban centre. The need for effective Indigenous employment programs is therefore very high. All trainees are unskilled and have been long-term unemployed. They have been nominated by their community as ideal participants for Marist Youth Care’s extremely successful program. Over the next 12 months this government will provide $100,000 in funding through the Indigenous employment program to assist Marist Youth Care.
I would especially like to congratulate graduands Troy Duke of Glenwood and Rhukaya Lake from Quakers Hill, who successfully completed the 2010 program. I would like to thank Marist Youth Care, and make special mention of CEO Cate Sydes, for the fantastic work they do in granting Indigenous Australians the dignity of work in my community and the wider community. I wish all of the 2011 participants all the very best.
The big banks and the major retailers have decided to spin EFTPOS off into its own organisation. Many small businesses view EFTPOS services as a part of their normal banking services and have paid bank fees and charges to support that activity. The decision to spin it off and form a new company is understood—so that we have an Australian based bill payment system to compete with Visa and Mastercard. What is not acceptable, though, is if it results in a double-dip against small businesses in terms of their bank charges and fees. If the banks and the major retailers see it in their interests to spin off EFTPOS, then they should also make a commensurate reduction in banking fees and charges to small businesses. Otherwise, this would represent a new service with additional charges, while the big banks hang on to the revenue stream that used to finance EFTPOS as part of an integrated banking package. I call on the big banks to support the decision to spin off EFTPOS, with reductions in bank fees and charges for small businesses that have been paying those charges on the basis of EFTPOS services being bundled with the services they have been paying for for many years.
Order! It being 2 pm, the time for members’ statements has concluded.
On indulgence, for the benefit of members regarding arrangements for sittings, the Senate a little while ago carried a resolution which enabled the Senate to sit until 10 pm this evening but then be suspended until 9 am tomorrow. They, of course, are having a break of an hour, from 6.30 pm until 7.30 pm, when they will not sit. So perhaps we could have a bipartisan suggestion that they might like to do things a bit quicker.
I am advised that with the transmission time required for the NBN bills—and this is not often understood—things do not just finish in the Senate and arrive here—there is a procedure that is beyond capacity to change, which will take anything up to three to four hours, I am advised by the Senate officials. I will consult with the Acting Manager of Opposition Business, the member for Menzies, prior to four o’clock to make a definite call on whether it is the case that it is worth while us waiting around this evening. If it is not the case, then it is in the interests, particularly of the parliamentary staff, that we suspend the sitting. If the Senate is to sit tomorrow, given the transmission time, it is probably more efficient in terms of people going about the arrangements they have made according to the sitting schedule. Perhaps we can do what we did last time, which is to come back on Monday. But we will make that decision—
Opposition members interjecting—
and perhaps if people object, they might like to talk to their Senate colleagues in the other chamber.
Order! I am about to make two reports from the Main Committee in relation to condolences. I would hope that I could get the cooperation of the House for at least these two motions.
Order of the day returned from Main Committee for further consideration; certified copy of the motion presented.
Ordered that the order of the day be considered immediately.
The question is that the motion be agreed to. I ask all honourable members to signify their approval by rising their places.
Question agreed to, honourable members standing in their places.
Order of the day returned from Main Committee for further consideration; certified copy of the motion presented.
Ordered that the order of the day be considered immediately.
The question is that the motion be agreed to. I ask all honourable members to signify their approval by rising their places.
Question agreed to, honourable members standing in their places.
My question is to the Prime Minister. I refer the Prime Minister to this report in the Australian Financial Review today confirming that the government has already walked away from tax cuts linked to her carbon tax. Given that these phantom tax cuts have been much hyped for days, including by the Prime Minister who described them as a ‘live option’, will she now apologise to Australian taxpayers for misleading them yet again?
I thank the Leader of the Opposition for his question. Firstly, I would suggest to him that he read the story carefully. Secondly, I will confirm to him that tax cuts are a live option for providing assistance to Australian households under this government. Of course, if the Leader of the Opposition were ever elected, the very first thing he would do is rip money out of the purses and wallets of Australians, take away the household assistance we have provided and then impose on them a charge of $720 a year for his failed plan to address climate change, even though we know—or most days, we know—that the Leader of the Opposition does not believe in climate change. Some days he does, some days he does not.
This all comes down to a question of judgment, a question of leadership and to making decisions in the national interest. If you are acting in the national interest, if you are showing judgment, then you accept the science that climate change is real. You accept the economic advice that the best way of tackling it is by pricing carbon. You accept the further economic advice that the best way of doing that is through an emissions trading scheme and, if you believe in fairness, then you act to use the money raised from carbon pricing to assist Australian households.
Let me say again to the Leader of the Opposition: in assisting Australian households, tax cuts are a live option. Then of course you use the money raised from carbon pricing to assist industries to adjust and then you use money raised from carbon pricing to tackle climate change through funding climate change programs. These things are questions of judgment and questions of leadership. It is the judgment and the leadership that Prime Minister John Howard showed when he went to the 2007 election promising an emissions trading scheme. But, as Australians saw yesterday, they can never expect leadership or judgment from the Leader of the Opposition.
My question is to the Prime Minister. Why is a carbon price a more efficient way of investing in a clean—
Mr Hartsuyker interjecting
Order! The member for Cowper, who was the one that I heard, will withdraw.
I withdraw.
Mr Speaker, the interjection was added to by the Leader of the Opposition, and he should also withdraw.
Mr Speaker, if it would assist the House, I withdraw.
I thank the Leader of the Opposition.
Mr Perrett interjecting
Order! Member for Moreton, I think that when a line is drawn under an incident it does not assist to drag it out any further. The member for Greenway has the call.
My question is to the Prime Minister. Why is a carbon price, rather than direct action, a more efficient way of investing in a clean energy nation and why is it vital for the national interest?
I thank the member for Greenway for her question and for her strong representation of her local community in this place. As a strong representative of her local community who believes in coming into this place and acting in the national interest, she knows that it is in the national interest to tackle climate change and that it is in the national interest to price carbon and to create the right mix of incentives and rewards to enable the development of clean energy solutions.
At the moment you can put carbon pollution into the atmosphere for nothing. By pricing carbon, we will send a signal to the thousand biggest polluters in this country that there is a cost when they put carbon pollution into the atmosphere. As a result they will innovate and they will change. Australian businesses are very adaptable. They have adapted to economic reform in the past and they will do so again in the future. With the money raised from pricing carbon, you can assist Australian households, which we will do—and we will do so fairly because we are a Labor government—you can assist Australian industries make the transition and you can fund programs to tackle climate change.
In answer to the question from the member for Greenway, which asked me about the national interest, let me make some things very clear to the House. It is no wonder that shadow cabinet met twice to try to stop the shadow Treasurer belling the cat and confirming to the Australian people that, if we compensate and assist households through tax cuts, the opposition will take them away; if we assist households through direct increases in pensions, the Leader of the Opposition will take those increases away; and if we assist through direct payments, the Leader of the Opposition will take those away. We will assist Australian households and the Leader of the Opposition is committed to taking that assistance away.
But it gets worse than that—worse than taking money out of the purses and wallets of Australians. The Leader of the Opposition is committed to a failed plan which would see carbon pollution in our economy rise by 17 per cent by 2020—rising carbon emissions—or the Leader of the Opposition would rip $720 off Australians to pay for his $30 billion worth of failed plans. So more assistance but more tax to be paid by Australian families—decent people who understand that this is a big challenge which, in our national interest, we need to face up to.
Decent people work their way through the facts and they think about these things very deeply. The Leader of the Opposition has taken a different course. That stands in stark contrast to the things that have been done by Liberal leaders in the past. I would refer the House to the Shergold report, the report of the task group on emissions trading, which made it clear to Prime Minister Howard—which is why he adopted the scheme—that it is the most efficient way of pricing carbon. Unfortunately, the present Leader of the Opposition is not a fit successor to Liberal leaders past. He has repudiated the power of the markets. He has repudiated the national interest. He would prefer to act in his political interests with his fear campaigns than act decently in the interests of Australians.
Mr O’Dowd interjecting
I regret to inform the member for Flynn that he is suffering from the same problem that the member for Riverina suffered from earlier on, in that his projection does not get here to interrupt, but he should remain silent.
My question is to the Prime Minister, and it is a supplementary to the member for Greenway’s question. I refer the Prime Minister to comments—
Government members interjecting—
Mr Speaker—
The Leader of the House will resume his seat.
Honourable members interjecting—
Order! Just for the record, this is of course not being treated as a supplementary question. The member for Goldstein has the call and he has the right to ask a question.
I refer the Prime Minister to comments yesterday by the head of the Productivity Commission, Gary Banks:
… it will not be efficient from a global perspective (let alone a domestic one) for a carbon-intensive economy, such as ours, to abate as much as other countries that are less reliant on cheap, high-emission, energy sources.
I ask the Prime Minister: why is she insisting on introducing a carbon tax before the rest of the world that will close down industry, cost jobs, increase the cost of living and give our trade competitors an unfair advantage? (Time expired)
Honourable members interjecting—
Order!
Mr Sidebottom interjecting
I will just say to the member for Braddon that I do not need any advice. If people want to talk on despite the limit to the duration of question time, that, I think, is sufficient a penalty for the whole House.
Mr Speaker, on a point of order: it goes to the question and the amount of argument that was in that question, clearly making it out of order.
The question stands. The Prime Minister has the call.
I thank the shadow finance minister for adding to the member for Greenway’s question—an unusual move! The shadow finance minister asked me about the Productivity Commission review of international carbon pricing, and I think this is an important piece of work; I do. Gary Banks spoke about it on behalf of the Productivity Commission, and, as usual, when the opposition comes into this place and quotes documents, they quote selected pieces or indeed just misquote them entirely, because I will refer the shadow finance minister to the conclusion of Mr Banks’s speech. He said these words in conclusion:
While we may not be able to deliver everything that some people expect, I am confident the study can shed light on what other countries are doing, how the various policies work, the uncertainties surrounding the efficacy of many of them, how much they achieve and at what cost.
This is the work that the Productivity Commission has been asked to do to provide a stream of advice about action that is happening in other nations to embrace a clean energy future. This is one of a number of important pieces of work that are informing the government as we deliberate on carbon pricing. Those pieces of work include the reports and updates that people have seen released by Professor Garnaut over the past few weeks. Of course, we will also be informed by Treasury modelling.
The point that the shadow finance minister should draw from that is that there will be abundant information and facts available about the key matters that require judgment in the national leadership. Is climate change real? Well, there were climate change scientists in this parliament today available to members, hosted on a bipartisan basis, to talk about how the science is real, even though the Leader of the Opposition goes around denying it. Then of course we have the economic advice about the efficient means of acting, and the most efficient means of acting is by putting a price on carbon. Then we will have the Productivity Commission work, which will add to other streams of knowledge about how the rest of the world is acting, including China, India and the United States. What this means is that the shadow minister—who is not prepared to act in the national interest but joins the Leader of the Opposition in his fear campaign—would prefer that the economic future of this country had us being left behind the clean energy future of the rest of the world, with all the loss of prosperity that that would provide.
As this parliamentary week draws to a conclusion, I believe members, particularly coalition backbenchers, will leave this place thinking about questions of judgment. They will go back to their electorates and think about the judgment of the Leader of the Opposition as he denies the climate change science. They will think about the judgment of the Leader of the Opposition as he shares a platform with Pauline Hanson, something John Howard would never have done.
Mr Speaker, on a point of order: I put it to you that, by any stretch of the bow, this is no longer directly relevant.
The member for Menzies will resume his seat. The Prime Minister will directly relate her remarks to the question. The Prime Minster.
I am talking about this parliament acting in the national interest; I am sure that should be relevant on all occasions. The government will continue to do that by pricing carbon, and people will look at the Leader of the Opposition, who called it wrong on the flood levy, who called it wrong on the health agreement, who is calling it wrong now and who particularly called it wrong yesterday, as a hollow man with no judgment.
I inform all members that we have in the gallery this afternoon the Hon. Brendan Nelson. Whilst it would be setting a precedent to acknowledge him for the position in which he is acting on behalf of Australia at the moment—and whilst I know he is doing a good job in that—he is acknowledged as the former member for Bradfield, a former minister and a former Leader of the Opposition, and he is warmly welcomed.
Hear, hear!
My question is to the Minister for Climate Change and Energy Efficiency—
Opposition members interjecting—
Order! The member for La Trobe will resume her seat. We will proceed when the House comes to order.
My question is to the Minister for Climate Change and Energy Efficiency. How has the government’s plan to take action on climate change been received? Why is it important that debates on major policy challenges such as climate change be based on sound judgment and leadership? Is the minister aware of recent commentary on these issues and what is the government’s response?
I thank the member for La Trobe for her question. The government respects the climate science and the need to cut our pollution. Today, like a number of members of the House, I had a meeting with representatives of Climate Scientists Australia who reiterated to me, as they have done to many others today, the need to take action on climate change. They were in the building today because a forum was organised by the members for Chisholm, Moore and Melbourne on climate science for the benefit of parliamentarians. I am very pleased that members from both sides of the House attended that forum. However, there are others who obviously contest the science and oppose action being taken on climate change.
Will we move to name calling now?
The member for Cowan will leave the chamber for one hour under standing order 94(a).
The member for Cowan then left the chamber
At the rally at Parliament House yesterday, which the Leader of the Opposition had encouraged as part of the people’s revolt, the following sentiments were expressed on placards held by the protesters on the issue of the science: ‘Carbon really ain’t pollution’, ‘No carbon tax, reject junk science’, ‘Carbon dioxide is not pollution, I love CO2’, ‘Say no to carbon tax 4 UN/IMF global governance=agenda 21 genocide’. As we saw on television last night, there was much worse.
The so-called people’s revolt against carbon pricing has also attracted, as we have heard, supporters such as One Nation, Pauline Hanson, the League of Rights and a number of climate change sceptics. It is important for leaders of the community, and particularly the leaders of major political parties, to not be associated with extremes in the debate over carbon pricing.
Mr Ruddock interjecting
The member for Berowra is warned.
Not only has the Leader of the Opposition refused to clearly to dissociate himself from these groups but last night on ABC TV he said, ‘That was a representative snapshot of middle Australia.’ Well, you must be kidding. I am sure that there would be many on the opposite benches that did not find it representative of their own views or of the values and traditions of the Liberal Party either. The fact is that it was not befitting someone who wants to be leader of our nation. It goes to character and judgment as well as the ability to provide true leadership on an important public policy question.
Mr Frydenberg interjecting
Order! The member for Kooyong is warned. In warning the member for Kooyong, I remind people that it is the first step, under standing order 94, for future naming followed by the practices of the House that some, I understand, were not aware of yesterday.
All of this is important in this debate because what we have seen from the Leader of the Opposition is lots of aggression and not much courage when it really counts.
It is worthwhile reflecting on the words of Prime Minister, John Howard, to the Melbourne Press Club on 17 July 2007, when explaining the need to act on climate change through an emissions trading scheme because these are in the tradition of the Liberal Party. He said:
Australia brings formidable assets to this challenge: an educated, can-do and adaptable people a modern; flexible economy; world class scientific expertise; deep global engagement and an enviable reputation for institution-building and reform … No great challenge has ever yielded to fear or guilt. Nor will this one.
I could not agree with it more.
I seek leave to table the Parliamentary Secretary for Climate Change and Energy Efficiency’s statement, Shades of Goebbels in ‘truth campaign’, currently available on the ALP’s website.
The member for Flinders, I think, was either warned or amongst those warned that I would not give the opportunity during question time to people outside the questioner to table documents. I think that warning is sufficiently understood that he will know that I now invite him to leave the chamber for one hour under standing order 94(a). For those that shake their heads, I cannot prevent stunts but I can deal with them.
The member for Flinders then left the chamber
I refer the Prime Minister to the following statement by the chairman of BlueScope Steel this week:
I am critical of the selective use of Chinese data to imply that they are phasing out coal and we are not.
This is patently false and misleading and should not be allowed to drive our domestic debate.
I ask the Prime Minister, why is she insisting on introducing a carbon tax that will close down industry, cost jobs, increase the cost of living and give our trade competitors an unfair advantage based on misleading information?
I thank the member for his question, and let me assure the member I am all for the facts in this debate. In fact, one of the sharpest contrasts between the government and the opposition in this debate is: we are dealing with the facts; you are dealing with fear. We accept the climate change science; you do not. We accept the advice of economists that the most efficient way to act is to price carbon; you do not. We accept the collection of data from around the world about how other economies are moving, including China, and we have asked the Productivity Commission to report on that very fact; and I have got no doubt whatsoever when the Productivity Commission comes out with its work, then over there on the opposition benches they will distort it, they will misquote and they will go on a campaign of misleading to fit with their fear campaign, which is drawing them closer and closer to the extremes of Australian politics.
Mr Speaker, on a point of order: the Prime Minister has been speaking for one minute and she has not addressed China or the quote from the chairman of BlueScope Steel about her misleading statements. I would direct her to answer the question.
The member for Casey could also look at the second and concluding aspects of his question. We now get into this debate about whether things are relevant or directly relevant, and there was the expression ‘relevant to part’. I believe we are left with that it can be directly relevant to part as well. So far the Prime Minister’s response, whilst overly debating, is still directly relevant to the second part. The Prime Minister has the call.
Thank you very much in directing my attention to the second part of the question that the member asked me. The second part of the question would lead people to conclude that somehow having a price on carbon, advocating a price on carbon, does not mean that you care about Australian jobs. Well, let me quote a statement from someone who had the aspiration to have ‘the most comprehensive emissions trading scheme anywhere in the world’. Would the member assert that the person who said that did not care about Australian jobs? Then let me go on and quote words by the same person, who said:
No great challenge has ever yielded to fear or guilt. Nor will this one.
And then went on to say—
Mr Speaker, I rise on a point of order on relevance. How is this in any way related to the question?
The member for North Sydney will resume his place. I am listening to the answer, but when a question concludes with ‘why is she insisting on the introduction of a carbon tax that will—‘ and adds argument, I think that I am obliged to listen carefully to where this is going. But the Prime Minister knows that she needs to be directly relevant, and the Prime Minister has the call.
Thank you very much, Mr Speaker. Those words that I used, ‘the most comprehensive emissions trading scheme anywhere in the world’ are the words of former Prime Minister John Howard. In saying those words, why was John Howard then insisting on a price on carbon the way I am insisting on one now? I would suggest it is because we went through exactly the same thought processes, which is: climate change is real. I believe John Howard accepted the science.
Opposition members interjecting—
You sit behind a climate change denier. John Howard asked for a comprehensive report from Peter Shergold about the best way of pricing carbon. When he received it he read it and responded to it rationally—something that the opposition is now incapable of: reading, thinking and responding rationally—and, having done that, he determined that the best way forward for this country was an emissions trading scheme. He said the nation should price carbon. I believe the nation should price carbon, and that is why we will bring legislation to the Australian parliament to do just that.
I understand the member opposite will follow the Leader of the Opposition in a fear campaign, but I suspect in his heart of hearts he is actually one of the members sitting over there who watched with dismay yesterday. I wonder when he got his Liberal ticket—
Order! The Prime Minister will bring her answer to a conclusion.
excited as he was on that first day to join the Liberal Party, that he ever foresaw it would come to this.
Opposition members interjecting—
Order!
Well, let me tell you something about John—
Order! The Prime Minister will resume her seat. I am now completely aware that because so many people talk and yell they do not listen. I said, ‘The Prime Minister will conclude her answer’—and the yells continued. The Prime Minister has the call and I have invited her to conclude her answer.
Thank you very much, Mr Speaker. In conclusion, pricing carbon is about future prosperity for the economy. That is why I am insisting on it. John Howard understood that, and he was a Liberal leader who would not have shared a platform with Pauline Hanson.
Mr Speaker, on a point of order: quite apart from being in defiance of your ruling, the Prime Minister’s final statement was offensive and untrue. I would respectfully ask you to require her to withdraw.
I will simply say to the Leader of the Opposition that if he has a grievance with the statement made and the veracity of it there are other forms of the House that he might choose to use at the appropriate time.
Mr Speaker, further to my point of order; I understand your admonition, but it would assist the House greatly if the Prime Minister would not make statements which she knows to be untrue. That statement with which she closed her answer she knows to be untrue; she should not make it, and if she wants to complain about placards—
Mr Champion interjecting
Order! The member for Wakefield is warned, yet again. The Leader of the Opposition may be overgeneralising, but he has been allowed to make a point. He has made that point, and we will now proceed.
My question is to the Minister for Sustainability, Environment, Water, Population and Communities. The New South Wales state government, in a breach of at least the spirit of caretaker conventions, has approved drilling of 110 coal seam gas wells in the Gloucester basin, covering an area of 50 square kilometres and including the pristine Barrington region and key farming land throughout the Gloucester and upper Hunter areas.
This approval was done without any consultation with the water supply authority, MidCoast Water, nor with downstream water users in the Manning Valley, where a population of more than 50,000 residents are reliant on clean drinking water. Will the minister review this decision and make sure that it is done in a detailed consultation with the incoming New South Wales government so that the incoming minister at least gets the chance to start their job without their policy hands tied?
I thank the member for Lyne for his question. This is about the Gloucester coal seam gas proposal. I saw the photographs on Twitter of a rally which the member for Lyne participated in, with placards like ‘Save Gloucester’ behind him when he made a speech. There has been a high degree of community concern in many areas relating to coal seam gas proposals and some of that goes to the issues related to the best use of prime agricultural land. I do note, in passing, the legislation introduced today by the Minister for Climate Change on the Carbon Farming Initiative, which will provide a further incentive in favour of prime agricultural land being used for those purposes.
The federal environmental approvals are not able to deal with everything that is dealt with at a state level. They have to deal quite specifically with matters of national environmental significance. The state remit on consideration is often much broader. In 2008 my department determined that this proposal would require an assessment under federal environmental law. The state processes, as I am advised here, were concluded in February of this year. Whether the state government wanted to reopen those would be a matter for the state government; it is not something that I would be able to insist on.
In terms of federal assessment being required, there are consultation mechanisms available to me when the brief does come to me on this as to whether or not we want to have a further level of consultation beyond what has happened already. That is something that I will not prejudge, but will deal with when the brief is presented to me. I presume from the information that I have here that that will not be too far away.
There is one listed vulnerable species and there is a Ramsar listed site in the Hunter estuary, both of which give rise to matters of national environmental significance. They will be considered in the light of the law—the EPBC Act. I expect that brief to come to me before long.
My question is to the Treasurer. Will the Treasurer please outline for House the importance on delivering on reforms that are in the national interest?
I thank the member for Newcastle for that very important question. Reforms, particularly long-term reforms, are very important for our future prosperity. We would not enter our 20th year of economic growth if we had not embarked upon very significant economic reform in the past. It is absolutely essential to prosperity into the future, which is why the government is getting on with reform.
It is getting on with the introduction of the mineral resource rent tax. Today, with the Minister for Resources and Energy, I announced our response to the Argus report. This is a very important way of getting access to resource rents which are owned by the Australian people. Through this tax we now have the capacity to reform our economy: to boost national savings; to make a very significant commitment to the superannuation savings of 3.5 million low-income earning Australians; to cut company taxation; in particular, to cut the taxation for small businesses; and—most particularly—to make an investment in infrastructure, particularly in our resource-rich states of Western Australia and Queensland.
We have to do this because the challenges of mining boom mark 2 mean that we need to make the investment in the infrastructure so we are not bedevilled by capacity constraints, and so we can handle the huge pipeline of investment that is going to create more jobs as we go forward. So this is a very important reform. It will raise $7.4 billion to fund those tax cuts, particularly for small business and the investment and infrastructure.
But we have now got to the point where those opposite have become so extreme and so bizarre that they oppose this revenue; they oppose receiving $7.4 billion to give a tax cut to small business, they oppose giving a tax cut to the company tax rate, they oppose increases in superannuation for low-income earners and they oppose investment in infrastructure.
This is of a piece with their opposition to abolish mortgage exit fees as high as $7,000 when people want to shift their mortgage. The extremism of those opposite knows no bounds. When it comes to either sticking up for the big end of town or sticking up for Australian families, they stick up for the big end of town. They are not siding with ordinary Australian families; whether it is a carbon price, whether it is a competitive banking system or whether it is for fair taxation in the resources sector, they are siding for even bigger super profits for mining companies against the Australian people. They are signing up for more profitable banks against a fair deal in the banking system, and they are supporting the big polluters against average Australians. It is about time they did the right thing by average Australians, instead of sticking up for the big end of town.
My question is to the Prime Minister. I refer the Prime Minister to the statements from Toyota Australia that her carbon tax will potentially leave them in a corner with nowhere to go; from the Australian Food and Grocery Council, which wonders whether the government even wants food and grocery manufacturing in Australia; and from OneSteel, which has observed that the carbon tax will significantly disadvantage Australian manufacturers. Does the Prime Minister agree with these comments?
I thank the member for Indi for her question. She raises with me statements by Toyota. I have actually directly and personally consulted with Toyota on the question of carbon pricing. I did it yesterday, as it turns out. I know others were engaged elsewhere, but I was speaking to Toyota and, as I regularly do, to businesses: businesses around the country; businesses that trade in Australia; businesses that employ a lot of Australians. What businesses say to me is that they understand climate change is real. They accept the science that the Leader of the Opposition rejects. Of course, because they are businesspeople, they are always working out what is the lowest priced way of driving change. That is what gives them their competitive advantage as businesspeople. So they accept the advice of economists that the best way of tackling carbon pollution is to price carbon.
Then, of course, businesses want to be heard on this major public policy reform. They want to be heard on this major public policy reform in the way they have been heard on public policy reforms in the past when we have transformed our economy and adapted—
You are verballing them. It’s just not true. You are verballing them. You are not abusing them; you’re verballing them.
The member for Indi has asked her question.
when they have looked to be engaged as tariffs went down, as we floated the dollar and as we drove Australia to its competitive, prosperous position today. They have wanted their voices to be heard, and of course their voices are being heard as the government goes about the work of designing the carbon-pricing mechanism.
As I have indicated to the House during the course of this week, the CEO of BlueScope is involved in our business roundtable. I spoke to Toyota yesterday; of course, they are directly engaged as well, putting their views forward. So I would suggest to the member for Indi that if she wants to come into this place and quote the views of Australian businesses then for completeness she should talk about the views of Australian businesses as a whole. I would say to her that Australian businesses are not in denial of the future. They understand that we need a clean-energy economy, they understand that this will take change and they understand—
Mr Speaker, I rise on a point of order on relevance. The question was very simple. The Prime Minister was asked whether she agreed with these comments, not with any other comments which make broader discussion.
The member for Indi will resume her seat. The Prime Minister will respond to the question.
Thank you very much. Responding to the latter part of the question, what I would say to the member for Indi is that we will work with Australian businesses as we go about pricing carbon. I would also say to the member for Indi that, if she wants to be fulsome and clear with these businesses when she is apparently having these discussions—or perhaps she is just taking statements from the media, but when she is discussing questions with businesses—she may want to indicate to them that she contested the 2007 election on Prime Minister Howard’s team. Prime Minister Howard went to that election promising the most comprehensive emissions trading system anywhere in the world. He went to that election informed by this report—
Order! The Prime Minister should know that she needs to relate her remarks to the question.
and he went to that election saying:
Being among the first movers on carbon trading in this region will bring new opportunities and we intend to grasp them.
I would like to remind the member for Indi of that. She might want to reflect on that position of the 2007 election before she dedicates herself to spreading fear today.
I move:
That so much of the standing and sessional orders be suspended as would prevent the member for Warringah moving immediately:That:
An incident having occurred in the gallery—
The attendants will bring the gallery to order.
Honourable members interjecting—
The House will come to order. The Leader of the Opposition has the call.
I move:
That so much of the standing and sessional orders be suspended as would prevent the member for Warringah moving immediately:That:
I am sure that as soon as the Prime Minister stands up, consistent with what she has demanded of us on this side of the chamber, she will dissociate herself from those people in the gallery and apologise for their actions. They are here at her behest and she should apologise for their actions.
It used to be said of the late American President Richard Nixon: if he rubbed his nose he was telling the truth; if he tugged his ears he was telling the truth; but, as soon as he opened his mouth, you knew he was lying. That is the Prime Minister’s problem. This suspension is necessary to clean up the constant evasions and deceptions of this Prime Minister. She said, ‘There will be no carbon tax under the government that I lead.’ There is a carbon tax coming. She said that there would be a climate change people’s convention to establish a deep and lasting convention. There is no people’s convention. She said that there would be an East Timor detention centre before the election. There is no East Timor detention centre—that got lost somewhere in the Timor Sea. She said that there would never be onshore detention centres. There are onshore detention centres coming to a military base near you. She said that we must have a GST grab to fund public hospitals, and it is not happening. She said that the Murray-Darling Basing plan would be implemented, sight unseen. Now, it is not going to happen. She said that there would be a national curriculum, starting in 2011. Now, it is off on the never-never. She said that we must have a cash-for-clunkers scheme to save the environment. That was scrapped as soon as the floods hit Brisbane. She said that the mining tax was settled before the election. Of course, it is not settled. She said that we had to have a tax summit to put the Henry review fully on the table, and now the great disappearing tax summit has become a tax forum and soon it will be a gathering of a coffee club.
This is a Prime Minister who has almost no familiarity with the truth. She claims that China is closing down its coal fired power stations—patently, untrue. She said that the Christmas Island detention riots were in-hand, and the centre was, subsequently, partially destroyed. She said that she has believed in an emissions trading scheme all along. Tell that to the foreign minister whose emissions trading scheme she sabotaged and then whose leadership she destroyed. I want to quote something that this delusional Prime Minister said to the Australian people a week ago. Listen to this Prime Minister, in full Napoleon mode:
Faced with hurdles, I will always find a way through. Faced with choosing between taking a few knocks or doing what’s best for the nation, I will put our nation first every time, no matter what the personal price.
Why did this Prime Minister stand up and brazenly say to the Australian people, six days before the last election, ‘There will be no carbon tax under the government I lead’? Was that a Prime Minister who would always put our country first? Was that a Prime Minister who would take a few knocks for the people? Of course, it was not.
We have seen quite a few different faces from this Prime Minister over the last little while. We have seen real Julia; we have seen fake Julia. We have seen wooden Julia; we have seen teary Julia. We have seen all the way with LBJ Julia; we have seen Bible expert Julia. We have seen George Washington ‘I will never tell a lie’ Julia. The fact is: the one thing we have never seen is truthful Julia. That is the one face of this Prime Minister we will never see because the one thing that she could not say to the Australian people, six days before the last election, was, ‘Yes, I will be honest and up-front with you: there will be a carbon tax under the government I lead.’ That is the fundamental problem with everything this government does. This government is based on a lie. What did we see today? Today, we saw precious Julia—very precious Julia, indeed—
The Leader of the Opposition will refer to members by their parliamentary titles.
campaigning and complaining about a few nasty placards. I’ll tell you what: we never heard any complaints from former Prime Minister John Howard when people like the minister for climate change and the Assistant Treasurer fronted rallies, before placards, calling the Prime Minister ‘Satan’ and ‘Hitler’ and ‘baby killer’. This is the kind of thing that the former Prime Minister had to put up with, and members opposite did not utter the slightest word of an apology or show the slightest sign of embarrassment. This is the preciousness of a Prime Minister who thinks that anyone who does not agree with her is an extremist. She thinks all of the people who were good enough to turn up outside of this parliament building, yesterday, were somehow extremists—everyone except the member for Robertson, who was there with them. The trouble with the extremists, as she sees them, is that they include the Chairman of BlueScope Steel, who is not only the Chairman of BlueScope Steel but also is so extreme that he is on the board of the Reserve Bank of Australia. She says that everyone who does not agree with her is extreme but she so forgets herself that she cannot remember that one of the extremes is the extreme she relies on to stay in government. This is a measure of the dishonesty, the mendacity and the hypocrisy of this Prime Minister. Why shouldn’t the Australian people be angry with this Prime Minister who won office based on a lie?
Why shouldn’t they be angry with a Prime Minister who said there would be no carbon tax? Now she says there will be a carbon tax, a carbon tax that will put $300 a year on your power bill, just for starters, a carbon tax that would put 6½c a litre on your petrol bill, just for starters, a carbon tax that will put $6,240 on the price of a new home, just for starters, a carbon tax that will cost 126,000 jobs in regional Australia, just for starters, and a carbon tax that will close down the steel industry, the aluminium industry and the motor industry, just for starters. I say to this Prime Minister: if she really is a person of conviction, if she really does believe that this carbon tax that she once said would never happen must happen—if she really believes this—why doesn’t she have the guts to face the people? Why doesn’t she have the guts to seek a mandate on her carbon tax and then accept the judgment of the Australian people? (Time expired)
Is the motion seconded?
I second the motion. Following on from what the Leader of the Opposition so eloquently said there, the Prime Minister is clearly delusional. In fact, I note that the former Leader of the Opposition is up in the gallery, former medical doctor Dr Brendan Nelson. If he were in this place he would diagnose the Prime Minister with delusional disorder and prescribe appropriate drugs. The reason why we need to move swiftly to deal with this motion—
Order! I allowed the Leader of the Opposition a very wide mark on making accusations that could only be made within a motion. The member for North Sydney is straying even further, and he should be very careful.
The reason why we are moving this motion now and we are seeking to suspend standing orders is that the actions of the Prime Minister are now having a profound effect on confidence in the Australian economy. The chief analyst at Southern Cross Equities has advised his worldwide clients that Australian equities are underperforming the world. I quote:
… the key issue is that Australia economic and taxation policy remains “unpredictable”, with foreign investors displeased with the continual “surprise” movement of the regulatory goal posts in Australia.
It goes on:
I don’t know how many times I have to write that “stability and certainty” of policy are how to attract long-term foreign investment …
There is no doubt in my mind this is the worst excuse for a Federal Government Australia has had since the 1970’s, and that is reflected by the global P/E relative de-rating of Australian equities.
That is going around the world, and what a surprise! When the Prime Minister is asked whether she is going to have a carbon tax, on the one hand she says no; on the other hand she says yes. When the Prime Minister is asked what the tax rate associated with it is going to be, on the one hand she says, ‘We’re making up numbers of $26 a tonne’; on the other hand the Secretary to the Treasury appears before a Senate committee today saying $26 a tonne is very reasonable.
Mr Swan interjecting
I am coming to you, Swannie.
Mr Swan interjecting
I am coming to you, old son! On the one hand they say jobs are going to be created by the carbon tax; on the other hand Eric Roozendaal warns Swan on coal job losses, he writes to him about that. We are on Eric Roozendaal’s side just on that one. On the one hand the Prime Minister says it is in the national interest to move on pricing carbon. Yet I feel sorry for the foreign minister over there; his heart must be contracting every time this Prime Minister says it is in the national interest to move on carbon pricing, because this is the Prime Minister that not long ago told that man to dump an emissions trading scheme—that it was in the Labor Party’s interest not to act. Of course, there could be no better illustration of the government’s schizophrenia than the fact that this Prime Minister ran out there and told the Australian people that there would be tax cuts associated with it. The government encouraged Ross Garnaut to go out there and talk about the Henry tax cuts—even briefing out the front page of national papers on a Newspoll weekend, and yet today the dead cat is on the table. There are no tax cuts. They are phantom tax cuts. They are not real. It is this government again engaging in deceit.
Mr Speaker, I would say to you this is having a profound impact not only on investment confidence; it is having a profound impact on consumer confidence, it is having a profound impact on Australian families, and it is having a profound impact on the confidence Australians have in their Prime Minister and in their government. It is just part of everyday policy, whether it be border protection, whether it be royalties in relation to the mining tax, or whether it be a host of policy issues. It is a government that is confused, a government that is directionless, a government without principle and a government without a soul.
From our perspective and the perspective of the Australian people, I would say to this government: dump the politics. We see the Labor MPs are ordered to distance the government from the Greens. In a week’s time we will see Greens MPs ordered to distance themselves from Labor. I would say to you, Mr Speaker: now is the time to go to the Australian people. Now is the time for the Prime Minister to have some ticker, to have some courage, to have some consistency. Go to the Australian people and ask them whether it is right for you to break yet another promise. (Time expired)
I rise to speak on the suspension motion of the Leader of the Opposition. The Leader of the Opposition asked me a question about a protest in the gallery. I do not believe people should protest in the public galleries of this parliament. I believe this parliament should be a place of reason. Because I believe this parliament should be a place of reason, I each and every day continue to be disappointed by the performance of the coalition in its modern form.
The Leader of the Opposition challenges me on my views about yesterday’s protest outside Parliament House. I have said no words of criticism of the individuals who attended that protest. I have said no words of criticism of the Australians who came to that protest. I have said no words of criticism of the placards they held up, and I do not say those words of criticism now.
Mr Hartsuyker interjecting
The member for Cowper will come to the dispatch box and withdraw. He is warned, and that is a precursor for naming.
I withdraw.
My criticism is not of the Australians who gathered yesterday; my criticism is of the Leader of the Opposition for exercising the poor judgment of going out to a rally and associating himself with One Nation, with the League of Rights, with anti-Semitic groups and with grossly sexist signs. That is my criticism. It is not of the Australians who gathered out there. I utter not a word of criticism about them but I criticise the judgment of this man in associating himself with extremism and with gross sexism.
The House will come to order. The Leader of the Opposition will sit back down; he can deal with any grievance that he has, after this debate, by other means. He was heard in silence. He was allowed a lot of latitude outside of his motion for suspension of standing orders. The Prime Minister has the call and the Leader of the Opposition has other avenues to use. This applies to both sides: I am happy for you to have a robust debate but to carry on in the way that the House carries on is ridiculous.
On yesterday’s protest every Australian has the opportunity to see the footage and to judge for themselves. But the judgment to go out to that protest is indicative of a continuing lack of judgment by the Leader of the Opposition. National leadership requires judgment. It requires getting the big calls right. It requires constancy of purpose. It requires an ability to absorb the facts.
Mrs Bronwyn Bishop interjecting
The member for Mackellar is warned.
It requires working your way through those facts and policy design. At every stage this Leader of the Opposition gets the big judgment calls wrong.
Let’s just look at the issues confronting the nation this year. On rebuilding Queensland the Leader of the Opposition got the judgment call wrong. He preferred to spread fear in the community rather than put together a package to rebuild Queensland. He does not run that fear campaign any more. He has dropped off that fear campaign but there he was, saying to the people of Queensland that he was quite fond of levies when they were about funding his election commitments but he would not exercise the judgment to support a fairly constructed levy to rebuild Queensland and the rest of the nation. National leadership requires getting the big calls right.
Secondly what happened this year was a national health agreement. We have a health system staggering and suffering because of the actions of the Leader of the Opposition, when he was a long-serving health minister. This Leader of the Opposition, characteristically, with his usual misjudgments, went out and bagged the COAG national health agreement before it was announced. He did not wait to absorb the detail, did not worry about the future for Australian families, did not put his mind to whether or not people would be able to get a doctor in the middle of the night or whether their public hospital would work for them when they needed it; he just went out and criticised, because that is what the Leader of the Opposition does. National leadership requires getting the big calls right.
I rise on a point of order. The terms of the suspension of standing orders are about the carbon tax. The Prime Minister should be required to defend her positions on the carbon tax. She is talking about the national health reforms. I would suggest to you that it is well beyond—
The Manager of Opposition Business will sit down. I appreciate that he has supporters around this place who think he has a role as the Manager of Opposition Business but he was outside the chamber when his leader was on his feet. It was a very wide suspension of standing orders. The Prime Minister could hardly not be in order compared to what has been said in the debate so far.
Of course it continues. The Leader of the Opposition gets the big calls wrong. In balancing the budget he had an $11 billion black hole. With the minerals resource rent tax—allowing Australians to share in the wealth generated from the minerals in our ground through better taxation arrangements for companies, better infrastructure and more superannuation—he got the big judgment call wrong. On the politics of grief, we saw his shadow minister out there trying to raise fear and concern in the Australian community, edging their way towards embracing a discriminatory immigration policy, breaking away from the Liberal tradition over decades. There was the Leader of the Opposition on TV endorsing the bitter politics of grief in order to stoke community concerns.
Then he comes into this place on carbon pricing, refusing to recognise that he should be acting in the national interest. He is not a Liberal in the tradition of Liberals past. John Howard understood that this issue needed to be grappled with. John Howard understood that. John Howard actually put out this report. He went to an election promising an emissions trading scheme but here is this hollow, bitter man. He is a man with no judgment, who never gets the big calls right. The Leader of the Opposition has gone to the Australian community and said that he believes in climate change; no, he rejects the science. He has gone to the Australian community and said, ‘Let’s back the carbon pollution reduction scheme,’ and then switched his vote. He has gone to the Australian community and said, ‘Why not just have a carbon tax; it would be simplest system?’ and now runs a fear campaign against it. The Leader of the Opposition is a man with no convictions in the national interest. He is a man who will only look for his political interests.
I say to the Leader of the Opposition: I believe increasingly Australians are disgusted by his negativity and revolted by his arrogance.
Mr Hockey interjecting
Mr Abbott interjecting
Order! Both the Leader of the Opposition and the member for North Sydney were heard in relative silence!
They see it on display every day—this puffed up arrogance as he pursues his narrow political interests and goes about spreading fear and negativity in the community. He does not stand for one thing that would improve the lives of Australian families. Not one policy, not one plan, not one conviction: nothing that he believes in.
Mr Speaker, I want to conclude by saying this: the Leader of the Opposition, with his arrogance and his negativity, is leading the Liberal Party down the wrong path. I believe there are members on his backbench who will leave this place and sit in their electorate offices and they will think to themselves: ‘Did I take out a Liberal Party ticket all of those years ago in order to follow a man like this? Did I take out a Liberal Party ticket all those years ago to see my leader out at an event yesterday, associating himself with One Nation and the League of Rights? Is that why I joined the Liberal Party?’ And I believe when they reflect on that in their constituencies they will come to one conclusion: a man with no judgment stands before the Australian people exposed.
Order! The time allotted for the debate has expired. The Leader of the Opposition on a point of order.
Mr Speaker, the Prime Minister, I think quite appropriately now that she has finished her contribution, made an utterly offensive statement about the nature of the coalition’s immigration policy and she should withdraw.
Honourable members interjecting—
Order! There were numerous things in the three speeches in that debate that, if I had been alert to them earlier, we might have had contesting withdrawals. I think we should leave it at that and perhaps over the break try to get back to thinking about treating each other with a little bit of respect and civility.
Question put:
That the motion (Mr Abbott’s) be agreed to.
Mr Speaker, it being clear the opposition has no questions, I ask that further questions be placed on the Notice Paper.
Yesterday the member for Hughes raised with me a query about the availability of gallery seating for question time. For the information of the House, I take this opportunity to remind honourable members of the process for gallery seating for question time. Tickets for the majority of seats can be booked in advance. Some seats are kept aside for people who arrive without a booking. Unfortunately, yesterday, there were approximately 80 booked seats left vacant at the beginning of question time, as the persons for whom the seats were booked did not turn up.
Further to my advice yesterday, when tickets for the galleries are fully allocated, people are advised to queue for available seats. In addition to the seating kept aside for people without bookings, further seating becomes available where they are no-shows and as people leave the galleries. I am advised that, to date, all people coming to view question time have been accommodated in the galleries at some stage during the proceedings.
Today is the 21st anniversary of the first election of seven members to this place. They are the members for Hotham, Werriwa, Banks, Maranoa, Fairfax and Wide Bay and the great political comeback merchant, the member for McMillan. I believe to have seven members that have gone the distance of 21 years out of the 150 is something of great credit to each of them. I hope that in some way each member will have something in their heart that would say, ‘Congratulations, well done and thank you.’
Honourable members—Hear, hear!
I present the Auditor-General’s Audit report No. 34 of 2010-11 entitled General practice education and training.
Ordered that the report be made a parliamentary paper.
I present the Selection Committee’s report No. 18 relating to the consideration of bills. The report will be printed in today’s Hansard. Copies of the report have been placed on the table.
Report relating to the consideration of bills introduced from 3 March 2011
Orders of the Day
House of Representatives Chamber
11 – Sale of Australian Securities Exchange – Motion of Mr Katter
20 – Auditor-General Amendment Bill 2011 – Mr Oakeshott
21 – Environment Protection and Biodiversity Conservation (Abolition of Alpine Grazing) Bill 2011 – Mr Bandt
22 – Abolition of Age Limit on Payment of the Superannuation Guarantee Charge Bill 2011 – Mrs B K Bishop
23 – Reducing carbon pollution – Motion of Mr S P Jones
24 – Milk pricing – Motion of Mr Cobb
Main Committee
1 – Flooding of communities in the Torres Strait – Motion of Mr Entsch
2 – Meat export industry – Motion of Ms Saffin
5 – World Veterinary Year – Motion of Mr Cobb
Standing Committee on Education and Employment:
Documents are presented as listed in the schedule circulated to honourable members. Details of the documents will be recorded in the
That the House take note of the following documents:Australian Competition and Consumer Commission—Report—Telecommunications—Telstra’s compliance with price control arrangements for 2009-10.Department of the Treasury—Guarantee Scheme for Large Deposits and Wholesale Funding—Report, 24 March 2011.Foreign Investment Review Board—Report for2009-10. Schools Assistance Act 2008Report on financial assistance granted to each state in 2009. Superannuation (Government Co-contribution for Low Income Earners) Act 2003Quarterly reports on the operation of the Act—2009—1 July to 30 September, 1 October to 31 December.2010—1 January to 31 March, 1 April to 30 June, 1 July to 30 September, together with the annual report for 1 July to 30 June.Sydney Airport Demand Management Act—Quarterly reports on movement cap for Sydney airport—1 October to 31 December 2010.
Debate (on motion by Mr Hartsuyker) adjourned.
I have received advice from Mr Bandt nominating himself to be a supplementary member of the Standing Committee on Education and Employment for the purpose of the committee’s inquiry into the Social Security Legislation Amendment (Job Seeker Compliance) Bill 2011.
—by leave, I move:
That Mr Bandt be appointed a supplementary member of the Standing Committee on Education and Employment for the purpose of the committee’s inquiry into the Social Security Legislation Amendment (Job Seeker Compliance) Bill 2011.
On indulgence: I wish to update members regarding the program for the rest of the sitting. The advice is not particularly good, it must be said, so if people could redouble their efforts in terms of getting our Senate colleagues to maybe get a move on with regard to consideration of the legislation, that would be desirable. I told the House that we would make a final decision, because people do have to make plans, by four o’clock. I will report back to the House after the second speaker on the MPI and I will consult with the Manager of Opposition Business about that. It must be said that they did spend a considerable time debating how long they would sit for. If they had just had the debate, maybe we would not be in this situation.
I have received a letter from the honourable member for Wide Bay proposing that a definite matter of public importance be submitted to the House for discussion, namely:
The impact of the Government’s taxation measures on Australia’s competitive advantage and standard of living.
I call upon those members who approve of the proposed discussion to rise in their places.
More than the number of members required by the standing orders having risen in their places—
Thank you, Mr Deputy Speaker, for giving me the honour of proposing this MPI on our 21st anniversary. I compliment my seven colleagues, the seven survivors from the class of 1990 on this anniversary. When I think back over those 21 years, I wonder whether there has ever been a time just like this when we have had a prime minister who went to the people, faithfully promising no carbon tax while she was Prime Minister—not once, but several times—and then having her turn around just a short time later and recanting on that commitment.
I can recall over the years the l-a-w tax cuts from Paul Keating that never happened, but this is in fact probably worse. Yes, it is in the taxation field, and we know from experience that when Labor talks about taxes and tax cuts, it is simply not the truth, and when they talk about new taxes, they are likely to happen, and even when they do not talk about new taxes, you are going to get them And here is another example of a major new tax which Labor promised faithfully they would not implement—they would not do it. Now today it is the most important thing on their agenda.
The Prime Minister said more before the election than that there would be no carbon tax under the government that she led. She also said prior to that, on 25 June, that she would not pursue a carbon tax before there was community consensus on the issue. She said:
First, we will need to establish a community consensus for action.
… … …
I came to that decision because I fundamentally believe that if you are going to restructure our economy so that we can deal with a carbon price and deal with all the transformations in our economy that requires, then you need community consensus to do so.
Who could say that there is community consensus in favour of the carbon tax today? Where is the community consensus? We have not had the committee that was going to be chosen from the phone book from every electorate to help decide the policy. There was no consultation with the community. The Labor Party went to the last election saying, ‘No carbon tax.’ The Liberal Party went to the last election saying, ‘No carbon tax.’ The Nationals went to the last election saying, ‘No carbon tax.’ There was no community discussion. There is no consensus that there is reason to have this monumental change of heart. It is just because the Prime Minister seemingly has had to do a dirty deal with the Greens—another dirty deal with the Greens.
It is also interesting to note that after she had done a deal with Senator Brown, after she had signed the agreement with the Greens, the Prime Minister said in question time on 20 October:
Yes, I do commit to keeping the promises made at the last election.
After the election, after the deal, in this House in front of everyone here and filled benches behind her—and they are not filled now; the members have all left—she promised then that she would commit to keeping the promises made at the last election. The frequent liar points start to click up—a promise made, a promise broken.
So where is the community consensus? It is simply not there. Was the community consensus evident in the rally outside yesterday with more than 3,000 people present? None of those people were supporting Labor’s carbon tax. Those people are now being described as extremists and radicals, not representatives of the true people, radicals and extremists like the member for Robertson and the three busloads who came from her electorate, making the point absolutely clear. People are being vilified because they exercised their democratic right to have their say. They are not people who, like the trade union movement supported by the Labor Party, smashed down the doors of Parliament House and were defended by members opposite. They did not resort to violence. They were not there with the former trade union boss who was around agitating this kind of a response, this level of debate. These people were putting their case and putting it strongly because they believed in it. They knew they did not have to smash down the doors like the trade union movement to make their point. They did it fairly and decently.
This government is about to do something truly remarkable. They are going to introduce a tax on Australians that is supposed to change the temperature of the globe. What a remarkable tax! Australians on their own are going to be able to cool the planet because we are going to pay another Labor tax, a tax on carbon in Australia that is supposed to cool the planet and make it rain again. Some people are even saying it will stop earthquakes and tsunamis. This is a remarkable tax! I have never seen a tax like it. It is so powerful that it can do all these things.
I have never heard of any suggestion that it was a tax that created the last Ice Age. It was not the tax that created the rain in the Biblical Flood. I do not think that it was a tax that dried up the Sahara Desert. But now we are going to have a tax that will fill the Murray and make it rain again and restore all goodness to the earth. I do not think that it was coalmining or motor vehicles or air conditioners that created the Sahara Desert either, but now we have found the cure, a magic cure—a carbon tax on Australians. We alone, with our tiny insignificant part of the world’s population, can fix these problems with a new tax.
I have heard lots of novel excuses from the Labor Party for having new taxes, but today’s new reason as to why we must have this tax really takes the cake. The Prime Minister said today that we have to have this new tax because it will make us more prosperous—a tax that is going to make us more prosperous! With $12 billion worth of tax we are all going to be richer; we are going to be better off. What a remarkable tax this is—it is so extraordinary. I cannot help but ask: where is the science that proves that this wonderful new tax will deliver all of these great things? We are told to believe the scientists. Produce for me a scientist that says that a carbon tax on Australians can cure the world’s climate problems; that a tax on Australians will lower the sea level or reduce world temperatures. It is simply a nonsense. It is a tax like all other taxes: it raises more money so that the government can spend it.
And we have been told how they are going to spend it. We have been given all sorts of answers. At one stage two ministers were saying that 100 per cent of this tax was going to be paid in compensation. Later it was said that only 50 per cent was going to be paid in compensation and the other bit was going to go on new green programs. That seems to me carte blanche. I do not know that I could really trust the Labor Party with another $6 billion to spend on green programs—new green programs like pink batts, a Green Loans debacle or a cash for clunkers scheme. What about the solar panel fiasco? We could spend more money on that. The government is still pursuing this line even though it was shown in today’s press that the $14 billion that has so far been spent on green programs in this country has not reduced CO2 levels one bit. Most of the projects that have been funded have actually increased CO2 emissions. The reality is that this tax will be exactly the same.
So who is going to pay this tax? The other great myth of the government is that the people who are going to pay this tax are in fact evil polluters—people who cannot be relied up; people who do not matter in our economy. Just who are these evil polluters? They are the manufacturers who make our steel and the products that we use. They are the food processors who make the food that we eat. They are the electricity generators who generate the electricity to power our houses and the things that we do. They are the people who create the jobs that make our economy strong. These are the evil people who Labor says will pay the tax.
But if you want to look at the reality: the ASX has said that the top 200 companies will pay $3.3 billion under Labor’s proposed carbon tax. That leaves $9 billion to be paid by small business and by households—by ordinary Australians. They are going to have to pay $9 billion of the tax as Labor proposes it. So it is not the remote, ugly, big polluters that are going to have to pay; it is ordinary men and women; families—
Good people.
good people; people who want to drive their car to see their sick mother; and people who want to go to the shops to buy some food and groceries. And the people have to be punished for this sort of activity—‘they have to be taxed; their behaviour has to be changed; they are evil; they are polluting’. Their behaviour has to be changed by a gigantic tax. But the government is now being told by everyone that this tax will not really work. The economists were out in force today to explain that this tax will not achieve its objectives. The March edition of Quadrant’s economic survey says:
ICAP’s senior economist Adam Carr said a carbon tax would have natural negative effects for both inflation and economic activity in Australia.
He said:
A carbon tax is inflationary, there’s no way around that.
He also said:
There is also no way around the fact that it will cut growth. I mean, where are the large scale viable energy alternatives in the short to medium term? So, really, all putting a tax on carbon will do is lift inflation; it will lift the price or the cost of economic activity. This in turn will cut growth and reduce our standard of living.
This is the kind of ‘wonder’ tax that the government wants to impose upon the Australian people. Economists say it will not work. If you give all of the money back to people by way of compensation, they will not try to change their behaviour, so it will make no difference whatsoever to CO2 emissions. Indeed, it will probably make them worse, because one of the things that this tax will do—as we heard today in question time and as we have heard in the media over recent times—is make doing business in this country more costly.
It will give companies every possible reason to locate their manufacturing industry and create jobs in other places. Toyota Australia said that the carbon tax will ‘leave them in a corner with nowhere to go’. The Australian Food and Grocery Council wondered whether the government even wants food and grocery manufacturing in Australia. The Australian Housing Industry said: ‘It will add $6,200 to the cost of an average home.’ OneSteel observed that a carbon tax ‘will significantly disadvantage Australian manufacturers’. BlueScope described the carbon tax as ‘the steel breaker’.
How can the government reasonably claim that this is a good and sensible thing to do? But let me give you another quote: ‘The carbon tax will not be good for tourism.’ That was not from some evil polluter or some big industry or some big employer; that was said by the federal minister for tourism, Mr Ferguson. When he met the Indian minister for tourism and culture, Ambika Soni, in India on 6 November 2008, he said a ‘carbon tax on aviation is not good for tourism’. So even the government knows that this is a job-destroying tax.
This is a tax that will hurt Australian people. This is a tax that will drive Australian jobs overseas to factories where the CO2 emissions will be much greater than in an environmentally sensitive country like Australia. When you close down a cement factory in Australia and open up one in China to supply cement to Australians you increase CO2 emissions. If you close down an Australian aluminium refinery, you may cut emissions in Australia but you increase the emissions in other countries where the emissions are much greater.
I visited the smelter in Kurri Kurri last week with Mr Baldwin, one of the members nearby, and we were impressed by the very real concerns of the trade union representatives we met and the management of the firm about the future of their jobs. They know that their owners will not invest again in Australia if we have this tax that other countries do not have. They know the next investment decisions will be to go to countries like Qatar, China or Indonesia, because they do not have such a tax. The uncertainty created by the government’s floating of this stupid carbon tax idea, this cure-all—the carbon tax that is going to save the world—has already damaged confidence in Australian industry and forced people to make decisions to invest in other parts of the world.
This is a tax that will not help the environment. This is a tax that will not make Australia prosperous. This is a tax that will not do things for Australian families. This is a tax that will destroy Australian jobs. This is a tax that will hurt Australians, and it should be rejected by all Australians. (Time expired)
I invite the members of the opposition to stay and listen a while and learn a bit. I listened carefully to the contribution from the current Leader of the Nationals and I would like to put forward the proposition in the next few minutes that our government’s taxation measures are having a positive impact on Australia’s competitive advantage and our standard of living.
Mr Hartsuyker interjecting
The member for Cowper will remain silent.
Well, we can all pray! In advancing this proposition, I would like to put up six submissions in support of it. I will address the Leader of the Nationals’ remarks about carbon pricing, but I also want to examine, in the course of this MPI, the inconsistencies in the opposition’s attitude to climate change. I would also like to register my concern about the climate extremists—
Mr Chester interjecting
The member for Gippsland!
the lunatic fringe, which some in the opposition are willing to—
Mr Chester interjecting
The member for Gippsland will remain silent also.
To support the positive impact of our taxation measures in Australia, I would like to use as reference the concern some of the more thinking elements of the coalition must be feeling about the association of their leader and others with the lunatic fringe, in terms of some who attended the rally yesterday. I would also like to examine and shed some light on the tax myth that somehow—
Mr Chester interjecting
The honourable member for Gippsland will remain silent.
the Liberal Party and their country allies, the Nationals, have an attitude of lower taxation than Labor, and point to the facts which very much contradict that case. When we look at the competitive position of the government’s taxation measures, I would also like to examine what we are doing with the minerals rent resource tax and some of the other positive changes that we have made since 2007.
Returning to the first of the submissions as to why the impact of our taxation measures will be positive on Australia’s competitive advantage and our standard of living, we must of course talk about the need to establish a carbon price. We are putting a price on pollution because it is the right thing to do, not because it is easy or popular. Big reforms in Australia are always hard fought and are met with well-resourced scare campaigns in favour of the status quo. Action on climate change was never going to be painless—we knew that before we announced it—but governments are elected to do what is right, not what is popular. Sadly, the Leader of the Opposition blindly refuses to accept that a low-pollution future is in Australia’s national interest, because he does not believe that climate change exists. So, just as putting in place superannuation was the right to thing to do—although it was opposed by those opposite—and just as removing the tariff wall was the right thing to do, pricing carbon and building a low-pollution future is, again, the right thing to do.
It is a fact that in Australia we produce more carbon pollution per head of population than any other country—
That’s not true.
It is a fact—
That’s wrong.
The Leader of the Nationals had 15 minutes to speak; if he regrets he did not make his points, I would rather he took this opportunity to at least listen to ours. It is a fact that our big polluters create more pollution per head than any other country in the world. In order to start turning this around, we need to start making the biggest polluters pay so that they—
Don’t go down with the tax, Bill.
I warn the member for Gippsland!
We want to make sure that the largest polluters are encouraged to invest in lower carbon pollution efficiencies—and I appreciate the member for Gippsland’s attendance in the chamber!
I can’t sit here and be quiet, sorry!
Unfortunately, if we are forced to wait, the costs will be far greater. There are no soft options and there are no cost-free ways to act.
There are two certainties about climate change: all nations including Australia are going to have to take action, and the longer we leave it the harder and the costlier it will be. I think there is a great danger to the Australian economy in having to play catch-up if we blindly refuse to change now, when we have the time to change. I do not think there is a ‘do nothing’ option, contrary to what the coalition would have people believe. Ignoring this situation is a bit like ignoring an illness until it becomes too much. Like treating an illness, early treatment is always better than later remedy.
We do believe that the large polluters should pay for their pollution. We think that they should look for less polluting ways to operate. We believe that every cent paid by the large polluters should go to families, businesses and climate programs that will help drive that transition to a clean energy future. This is all about making Australia’s largest companies pay for their pollution so that they have an incentive to improve their performance. It is not going to come out of the pay packet each fortnight, as some in the coalition would have people believe. There will be changes, but we will give people assistance so that they can be supported in the transition to a lower carbon economy.
There have been plenty of references to the question of which party is the party of the markets. What we believe is that a market based mechanism to reduce carbon emissions will provide the best chance for Australia’s standard of living to improve. It will certainly have less of a negative consequence than the direct action scheme of those opposite and it will be less damaging than the ‘no change’ option, which many of the climate change sceptics believe in. Lord Stern has said that the cost of inaction will be greater than the cost of action. If the views of those opposite prevail and defeat the proposals we have for setting up a carbon price, I believe that Australia’s prosperity and our future jobs will be at serious risk.
I think that the opposition’s position is, sadly, saturated in contradictions. On the one hand they get involved in organising climate change sceptic rallies, whilst on the other hand they want to put forward their direct action on climate change policy. On the one hand we have a Leader of the Opposition who thinks that climate change is ‘crap’ or, at least, that the science is not settled, whilst their alternative leader, the member for Wentworth, has made belief in climate change central to his political brand and values.
On one hand we have the daily media stunts of the opposition, designed to scare people about the impact of a carbon price, while at the same time they deny that they are running a scare campaign. On one hand we see the crocodile tears feigned by the opposition about cost-of-living pressures, but on the other hand they have the unfunded direct action package that would blow a multibillion-dollar hole in the budget and that would have to be paid for by taxpayers.
On the one hand—
Mr McCormack interjecting
I appreciate the member for Riverina is new to politics.
The member for Riverina is not in his seat—unless he has moved.
I was hoping my points were moving him. In 2007 Prime Minister Howard went to the election with an emissions trading scheme policy. The climate issue has progressed by four years and we see the coalition has regressed by many more years in their categorical opposition to an emissions trading scheme. On one hand, the coalition would have you believe that they are the party of free enterprise, but on the other hand they staunchly oppose a market based mechanism in our economy to help lower the amount of carbon pollution.
On one hand they feign interest in international engagement and good global citizenship, but on the other hand they like to see Australia stand idly by while the rest of the world takes action and we become a global laggard. On one hand they say that Australia needs to be a leader in innovation; at the same time, they do not want to see anything done for industry to gear itself up for a clean technology and green-collar economy of the future.
The bottom line is that they are on the wrong side of history in this debate for one simple yet very straightforward and powerful proposition: what they are putting forward to Australia does not work in our future interests. Forgetting the political analysis for a moment, if we look at the debate on logical grounds—you could call it the front-bar-at-the-pub common sense test; call it what you like—we see that in any analysis that steps back from the daily changing headlines the coalition’s proposition does not stack up because of their contractions and contradictions on climate change and pricing.
I think they are also getting found out for their association—and not all of the people who are opposed to this are cranks—with some of the extremist groups who fronted up for their association in yesterday’s rally, if I can call it a rally. Many regard the Leader of the Opposition’s association with some of those extreme views as unbecoming of a leader of a major political party in Australia. I did wonder about that particularly obnoxious, nasty placard, which is in the Fairfax papers, which the Leader of the Opposition, the member for Mackellar, the member for Indi and an assorted raggle-taggle bunch of coalition MPs were standing in front of.
Mr Briggs interjecting
The member for Mayo will remain silent.
What we saw was a number of coalition MPs—I think the Leader of the Nationals was standing in the Leader of the Opposition’s shadow, as he is wont to do—with a very nasty poster behind them. I thought, being charitable to members of the opposition, that perhaps they had been set up and that somehow an extremist had come in behind them to embarrass them. But I found out from other reports about the rally that the chap with the poster—whatever you thought of it—had been standing there and the Liberal MPs came and stood in front of it.
Then I went further. I had a look at the website of the No Carbon Tax rally group. The website was advertised on some of the T-shirts that members at the rally were wearing. This unusual website includes a 10-second guide to the world of climate change sceptics and a sceptics handbook—that would surely be one of the shortest books in the English language, the world of climate change sceptics. They say that CO2 is not pollution and does not need to be reduced in the first place. They say it is natural, we exhale it and it is needed by plants to grow. Then they say that even if CO2 were dangerous—which is an interesting concession—and even if we reduced it successfully in Australia or even globally, there is no physical evidence that it would have any beneficial effect on the climate. They describe global warming as the great 21st-century climate change folly. The website has a link to the climate change sceptics shop—that would be fun to shop at; the Climate Sceptics political party—I do not know if they are registered yet; and Menzies House. Some of the slogans yesterday were: ‘CO2 is just tree food’, ‘carbon tax is a tax on fresh air’, ‘don’t tax the air we breathe’, ‘CO2 really ain’t pollution’ and ‘climate change is crap’.
What concerns me is not that some people hold unusual views—that is a factor in our democracy; what concerns me is that the alternative government of Australia chooses to associate itself with some of these extreme views. I can only wonder if indeed the Leader of the Nationals will be seeking policy advice from Charlie Sheen next. He is not doing the sitcom; he could dial in to shadow cabinet every week, or maybe just once a month, to give the guys a bit of a leg-up.
Just as what we saw yesterday was ridiculous, another myth that the opposition pedal about the tax situation in Australia is that somehow if they were in power taxation would be marvellously low and we would be led to a land of milk and honey under the National Party and the Liberal Party and that, by contrast, Labor is dangerous on taxation. Let’s just deal with this myth. In 2007, when the Howard government was defeated at the polls, Commonwealth taxation as a proportion of the GDP was 23½ per cent. Now, in 2009-10, it is down to 20.3 per cent. Ladies and gentlemen, the facts do not lie. We have seen this driven in part by the economic slowdown in corporate revenue falls and the tax take but we have seen significant personal tax cuts. The tax burden in Australia has us measured as the sixth lowest in the OECD.
Under Labor, we have a better tax regime and we have a better chance to reform the economy. Someone who is on $50,000 this year is paying $1,750 less tax than in 2007-08. But, of course, we have not forgotten the pensioners and we have increased the pensions. We have increased the pensions by $128 a fortnight for single pensioners and around $116 a fortnight for pensioner couples. We are making sure there is an education tax refund, we have the Medicare Teen Dental Plan, the childcare rebate and we are improving the returns for people who get family tax benefit A. We have extended the tax refund to school uniforms, there is paid parental leave and we have not taxed large companies in order to get the paid parental leave. We are providing paid paternity leave for fathers, and there will be further pension increases in the course of this year. We want to make tax returns easier. This means there will be standard deductions of $500 rising to $1,000. We are providing tax relief to savings accounts.
One of the ways we are doing this marvellous list of accomplishments is through the minerals resource rent tax. What we are doing is ensuring that the benefits of the minerals boom are spread throughout the whole economy. We are doing this through making sure that the proceeds of the MRRT will go to infrastructure in the states of Western Australia and Queensland and elsewhere. We are also making sure that we can increase superannuation for 8.5 million Australians.
What we are doing is working like Trojans to improve our tax system. We want to boost our national savings. We want to increase our superannuation. We want to decrease company tax rates. The Henry review made clear that it was far wiser to tax immobile resources than mobile resources because mobile capital could be moved all around the world and it was a far better idea to tax immobile resources such as minerals. What we are doing with that is moving our taxation system to reallocate it to fall more on the immobile resources, and we are seeking to lower the corporate tax rate. We want to provide superannuation for low-income earners. We want to raise the concessional caps. We want to raise the level of the superannuation guarantee from 70 to 75. We want to introduce a tax discount on interest. We want to see the phasing down of international withholding tax. (Time expired)
Australians need to clearly understand that this decision to introduce a carbon tax is driven solely by politics—opportunistic, cynical and totally self-serving politics. It is the price of a single vote in this chamber. That is the nub of it. It is the price of saving the Prime Minister’s political skin. And the price will not be paid ultimately by some anonymous nasty big business; it will be paid by Australian families, by Australian seniors, by all of us. It will be paid in higher costs of living, in lost jobs, or in both. For every million dollars raised, $100,000 will, by agreement, go off to the United Nations. Can you believe this? One hundred thousand in every million will go off to the United Nations. That is akin to spending it on pink batts. It is like throwing the money away. This is a self-serving, cynical move by this government.
This debate is an argument about who can deliver a five per cent reduction in CO2 emissions by 2020 with the least impact on electricity prices and on jobs. It is about incentives, really. In going it alone on a carbon tax and then, subsequently, an emissions trading scheme, the incentive is to shift emissions and jobs overseas. In going with direct action, the incentive is to reduce emissions in Australia in a way which reduces global emissions without increasing electricity prices or costing jobs. This is a fact which is consistently ignored, misrepresented and lied about in the arguments put by those opposite. There are alternatives. There is a better way, and we have it. The crux of the better way is the fact that we are going alone on this measure of a carbon tax and then an emissions trading scheme.
The key flaw in the Gillard government’s decision to impose an $11 billion tax every year on Australians is the failure of the rest of the world, and in particular our major competitors, to come with us, to act in unison. Yet we have been lectured in a sanctimonious fashion for years and years and years by those opposite about the imperative of a global scheme. We heard it endlessly from the former Prime Minister, from the former Deputy Prime Minister, from the former minister for climate change. They said: if emissions are to be reduced, and reduced in the most economically efficient manner and in a way which will reduce global emissions, we had to have a global scheme. And they were right. If we had a global agreement which included our major competitors it would mean Australia, with its cheap coal, would be one of the last countries to transition away from coal for electricity generation. This occurs because if a global emissions trading scheme or a global carbon tax scheme was in place, the world’s emissions would be cut fastest and at least cost by Australia buying international emissions permits rather than converting its own power stations. It is all about comparative advantage. It is basic economics, but you would not know it from the gobbledygook about the markets that we have heard from the other side.
It is basic economics that if the rest of the world have got higher cost emissions, those plants will be phased out sooner than our plants. Yet this has been totally ignored; in fact, I do not think they really understand it. And that means that we could have coal fired power generation that will be scrapped possibly decades ahead of what could happen, if we go it alone. We could have 30 or 40 years of coal fired power generation scrapped when, if there was a global agreement, other countries would be scrapping their coal fired power generation and we would still have cheaper electricity with our hundreds of years of cheap, good quality coal. But, no, we will scrap our industries and send them offshore—our lead smelters, our zinc smelters, our aluminium smelters, our cement works, on many of which whole towns rely. Whole communities, people’s lives, their families, their grandparents, the kids, the schools, the community spirit—gone because of political expediency. That is the sole reason they have stepped aside from what they told us for years must apply—a global scheme, otherwise we are not competitive internationally—to go unilaterally to save their skin, to get that one vote up there.
One Green vote in this House to save your political skin. It is pathetic. It is self-serving. It is cynical. It is irresponsible. At the cost of Australian jobs and at the cost of the living standards of Australians, you are prepared to do what you are going to do: make the biggest structural change in our history, scrap coal fired power plants years before they would, scrap all these other industries, cost us tens of thousands if not hundreds of thousands of jobs—all in the interests of saving your political skin.
Acting unilaterally will be irrational, and a very costly adjustment in Australia to the great advantage of our competitors. Acting alone with a tax is not rational. Acting alone ignores the fact that the market they endlessly parrot on about is now a global market. When they talk here, preaching to us about the marketplace and the need for market forces, they are assuming that the market we are talking about is Australia. We are now in a global market, okay? In case they do not know, we are in a global market.
This means that we cannot quarantine Australia from the world market. It is like putting a carbon tax on in Victoria and no other state, and then all standing around scratching our heads wondering why hundreds of jobs and lots of industries are moving into New South Wales, South Australia and Queensland. It is the same thing: we are going to put a tax on Australia and scratch our heads, wondering why jobs are going to move into China, Malaysia, Thailand and India and into all of the neighbouring regions, and why our competitors around the world are getting a free run.
This is irresponsible, this is inane and this is naive. They do not know what they are talking about, and their economics is not even at a prep school level. They misrepresent it and they misunderstand it. We have a situation where the former Prime Minister understood it, and that is why when he was so disconsolate after the Copenhagen round that he gave in to the urgings of those opposite to scrap a global scheme—he suffered accordingly.
He understood it and industry understands it: if you want to change global emissions you need a global agreement. The Europeans, in their stupidity, have proven this. Since 1990, the Europeans’ emissions from production have fallen flat—no change. They are priding themselves and are so pleased with themselves that they have had no increase in emissions of production. But their consumption of carbon has gone up by—only—44 per cent. What we have seen is a hollowing out of manufacturing in Europe, and it has all gone to China—emissions from Europe have gone to China.
As sure as night follows day this carbon tax will see a hollowing out of manufacturing in Australia. A global agreement must include our competitors. Who are they? Countries like Brazil, the biggest global producer of iron ore, or countries like Qatar in the Middle East—the biggest producer of gas. There is Sakhalin in Russia, which also produces gas. There is North America, and in Africa countries such as Cameroon, with huge oil and iron ore deposits. This is a government which is going to put us at an enormous disadvantage, undermine the great opportunities this country offers and kill the morale of so many people. This is a government which is irresponsible and is acting solely out of political motive. They must be condemned. (Time expired)
I rise to take advantage of this opportunity to speak against the matter that has been put before the House this afternoon.
The opposition, in their matter of public importance, have come forward asserting that the taxation policy of this government has in some way jeopardised the future living standards of Australians. I make the point that my colleague the Assistant Treasurer made a little earlier, and that is that one of the significant initiatives that we have undertaken in relation to taxation is the introduction of the minerals resource rent tax. We are working through the process of introducing that reform, and in doing so will undertake a taxation reform that will ensure the Australian people are able to secure a reasonable return upon the exploitation of our resources.
This was a tax that was recommended by the Henry review. The Henry review recommended that we should shift our taxation base away from more mobile factors of production and shift taxation to those areas that are more fixed. In that very way this government has brought forward a proposal that will not only introduce a minerals resource rent tax but cut corporate tax and company tax.
We find ourselves in the bizarre situation where the Liberal Party—supposedly the party of business—would like to parade themselves around as being supportive of business, and in particular, small business. But when it comes to company tax, we have a proposal to cut company tax and they want to stand in the way. They want to block a tax cut for companies. In doing so, they want us to do what they did in office, and that is to walk away from the great opportunity to tap into the mineral resources that are currently being exploited at a great rate of knots in this country as a result of the mining boom mark 2.
We are determined to take advantage of this opportunity; we will lock in those gains in the form of the minerals resource rent tax, and we will secure higher living standards for Australians through an investment in their long-term future through retirement savings.
In terms of the broader question of tax, I offer a few comments in relation to the overall tax burden across the economy. This government has made a commitment to retain taxation levels, or to ensure that taxation levels do not exceed, on average those levels that were in place when we came into office. To emphasise that point, the ratio of tax to GDP dropped from 23.5 per cent in 2007-08 to 20.3 per cent in 2009-10. So for all the discussion about taxation and the great burden of taxation that this government is supposedly imposing on people, the facts are facts, and those facts demonstrate that when it comes to the proportion of tax to the size of the economy we have lowered the burden of taxation in this country. Putting all of the rhetoric to one side, those are the facts.
I want to address the issue of the carbon price, because this is very much central to the discussion. When it comes to the carbon price, there will be many Australians all around this country who will be somewhat confused by the adversarial nature of the debate that we have been engaged in in this country. But to those Australians I say this: ask yourself a simple question. Do not be distracted by so many of the furphies that are brought forward by some of the extremes in this debate and, in fact, by some who understand the issues but seek to obfuscate and to confuse people. Ask yourself this question: do we believe as a nation that we will be able to continue to rely upon fossil fuels the way we do today into the future—10 years, 20 years, 30 years or 40 years into the future? Do you believe that we will be able to continue to rely on fossil fuels at the same rate that we currently do? Most Australians will conclude that the answer to that question is no, and if your conclusion is no then you are faced with a challenge, as this government is faced with a challenge. That is the challenge of how we best prepare for that future, a future where we as a nation will not be able to be as dependent upon fossil fuels as we have been in the past. There is much evidence, when it comes to preparing for that massive restructure that this economy will need to undertake, of the benefits of early action, regardless of international action. We support and encourage international action, but the benefits for the Australian economy will be there if we take early action.
There have been many parallels that have been made in relation to free trade. Sometimes when the economic reform train leaves the platform there are people left on the platform. We saw, when the Fraser Liberal government left office, that it had failed to confront some of the challenges in relation to free trade. We saw the Hawke and Keating governments tackle those issues. When the Hawke and Keating governments tackled the issues of free trade and tariff reform, the same voices of dissent and opposition came forward and said, ‘This will cost jobs.’ The same voices of dissent and opposition came forward and said, ‘We should not act ahead of the rest of the world.’ If we look back on those reforms and the benefits that they have delivered to the living standards of all Australians, the evidence is emphatic. All of the pretenders on that side of the parliament now like to pretend that they were hitching a ride on that train as it left the platform when it came to the economic reforms of the 1980s. They want to try and claim that mantle. They missed the train then, and today they are in danger of missing the train again.
Some of the smarter types on that side understand this, and one of the great challenges that they have from a public policy perspective and from a political perspective is that they are so divided on this issue. There are two camps in the Liberal Party. There are those that believe that climate change is real, that we need to take action and that the best way to do it is with a market based mechanism. They would consider themselves to be the true Liberals in the true Liberal tradition. Challenges of this nature, they would say, should be dealt with with a market based mechanism. They seem to be hiding at the moment, but I know that they are there, because when it came to the leadership ballot last time round Tony Abbott won by only one vote on this issue. The opportunity to vote on these issues will come again. But let us talk about the other camp. The other camp are the sceptics, and they are the ones that appear to be in the majority at the moment.
But the great difficulty that both of these camps have is that they cannot actually go out and sell what they believe in their heart of hearts, because it is not the Liberal Party policy. It is not the coalition policy. The coalition believe—or so they say—in reducing emissions by the same amount that we are committed to: five per cent by 2020 on 2000 levels. If you are going to try to achieve those cuts, you cannot argue the line that we see so many of you trying to argue: that climate change is not real. If it is not real, why are you wasting $30 billion of government funds—taxpayers’ funds—on a direct action policy that is an absolute sham, involves importing carbon credits from offshore and, in the end, will actually lead to an increase in carbon emissions by 17 per cent? That would mean that each family in this country will pay indirectly through their taxes—it might not be a specific levy, but I tell you what: indirectly they will pay—$720 to fund a climate change policy that is supposed to reduce emissions by five per cent but will increase them by 17 per cent.
It is a sham, and we will spend the next two years of this parliament shining a light on this sham. Those same people that found the courage to support action on climate change in the last parliament will be called to action, and they will be called to account. There will be people in electorates around this country—like the member for Bennelong, the member for Macquarie and the member for Brisbane—who will have to account to their electors, who believe that action should be taken on climate change. I will tell you the best evidence that the electors of Bennelong feel that way: they managed to convince even former Prime Minister John Howard that he needed to take action on climate change and, to his credit, he proposed to do so. And do you know what? As you all run away, scurrying away like cockroaches under the light, you will miss the train of economic reform and you will have to live with that. I tell you what: we will make you pay for that. In the same way as those that missed the boat last time round continue to pay, we will make you pay. (Time expired)
Consideration interrupted.
On indulgence, for the benefit and information of members: we will conclude the MPI debate. We will then go to government business up till five o’clock, when the sitting will be suspended. We will return on Monday at 10 am for a short period. It is expected that the sitting should not take more than an hour—in terms of the convenience of members and staff in making travel arrangements. It is the case that up to this point there is no certainty as to what time the Senate are likely to sit till. Given that they have scheduled to adjourn tonight and to return at 9 am tomorrow, and given that the transmission time of the legislation from the Senate to the House with amendments is anticipated to be three to four hours, I believe that this is the most sensible course of action, and I have advised the opposition formally that that is the case. I thank the House.
Consideration resumed.
It is a pleasure to contribute to this matter of public importance. We should be discussing this incredibly important topic rather than being diverted into political games and nuances. What we saw today in question time seems to be the new political strategy of this government—that is, name calling and carbon vilification of anybody who questions or even criticises anything the government may say about its planned tax on carbon dioxide. This matter of public importance is really about the government’s taxation measures that are disadvantaging our competitive advantage as a country and the standard of living of our citizens. It is interesting that—when the government has nothing else to say and no credible argument to present, to back its case for a tax that seeks to punish and harm and penalise every individual, every business, every activity, every step of production, every service, every area where wealth is sought to be created or every point of consumption or every stage of an input to any activity or business that anyone is engaged in, when it cannot come to address how on earth that is going to help—all it can do is revert to former Prime Minister John Howard. I can assure this parliament of one thing: Julia Gillard is no John Howard.
The honourable member for Dunkley will observe the provisions of standing order 64 and refer to the Prime Minister in the appropriate way.
The Prime Minister we have now is not John Howard. The Prime Minister we have now certainly has not put the nation in a relaxed and comfortable mode. The Prime Minister we have now certainly has not presided over what all in the nation recognise as the Howard government’s era of golden opportunity, where people were optimistic about their future, secure about the opportunities to improve their circumstances, confident about prospects; they understood that a competent government had plans for the future and policies that would make a difference. This Prime Minister is no John Howard.
I can point to another Winston, Winston Churchill, and give you an insight into that great leader’s appreciation of just how wrong-headed this government’s approach is—where every problem needs a tax and somehow our living standards will be boosted by another tax. It was around 1903 that Churchill had something to say that should resonate right across the economy and right across our community. He said, ‘A nation that tries to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.’ That was Winston Churchill’s account of it and that is exactly the logic that we are now accepting from the government as its rationale for this carbon tax. This carbon dioxide tax is supposed to lift our prosperity. This carbon dioxide tax is supposed to create jobs. This carbon dioxide tax is supposed to advantage our businesses. This carbon dioxide tax is supposed to be of benefit to families. How wrong could this government be? All the evidence says it is inflationary, it is punishing, it is punitive, it builds, it cascades and it snowballs at every stage of activity. It is going to cost jobs, particularly in areas where energy matters, not just at the point at which people work but at every input that led to the point where they tried to create some wealth for the country.
You have seen data rolled out time and time again that the government cannot counter. You have heard them talk about 16 coalmines. The opposition pointed out that, according to ACIL Tasman, that will lose 10,000 jobs. These are not extremists. Everyone who criticises the government is now an extremist. Everyone who questions some of its assertions is now an extremist. I did not think ACIL Tasman were extremists. I did not think Concept Economics were extremists when they pointed out that 24,000 jobs are at risk because of this tax. I did not think Frontier Economics were extremists when they pointed out that 45,000 jobs in energy-intensive industries will go, under this carbon dioxide tax. And I have not heard people make the argument that the ordinary men and women out there trying to contest, day in and day out, in manufacturing are extremists.
I want to pay tribute to the manufacturers. They need to be world-class every day. Consider them the Olympians of our economy, where they have to compete with the world every day. What are the manufacturers saying? They are saying to me, ‘If it wasn’t for our innovation, our ability to automate and our opportunity to improve our productivity, we’d have a real problem competing with the globe.’ So they compete vigorously through their innovation, through the use of technology and through improved productivity. Now, when they have to compete harder than ever, what does this government plan to do?—make it as hard as it possibly can, by imposing a carbon dioxide tax which will be absolutely punishing on those in the manufacturing sector. They are like the people who are exposed internationally, who are not part of the big crowd that can go to government and get some handout of permits—the big businesses that the government likes talking to. These are the men and women who work in our suburbs and our regional centres, that convert their energy and inputs, inputs that have consumed energy to be produced. They put their own energy—and more—into production processes for creating wealth in this country.
In Victoria we understand manufacturing because it is at the heart of our economy. Do you know what they are telling us in Victoria? I had the pleasure of speaking to Garry Rose from Kinetic Engineering Services. He is an industrial chemist and knows his way in the world. He has been in business for 32 years. He used to joke, ‘I thought my first 30 years were my hardest,’ but he thinks the time ahead will be his hardest. He described this tax as ‘idiotic’. Is he an extremist? I do not think so. Every day he is competing with Chinese imports. He is in the fabrication of things, like the star pickets you can buy from Bunnings and places like that. He makes those against the competition in China. He runs his business on a handful of guys, where there might be dozens of them in China offering the same product. He needs to be incredibly efficient. He consumes steel, and if the steel is too expensive he cannot compete. If the steel is not manufactured in Australia—as OneSteel is concerned about for its future—that steel has to come in from overseas. I reckon it will not come in as steel—it will come in as star pickets. And then what happens to his business?
He is urging the government to think carefully about what it is doing, to understand the impact on small and medium enterprises in Australia and particularly to appreciate that, in manufacturing, these imposts—these imposts that will build at every stage—could, as OneSteel has pointed out, make their business unviable. OneSteel and some of its competitors with electric arc furnaces watch the spot electricity market because, if the electricity spike goes up, they do not run the arc, they do not run the furnace. They wait till it comes down then they bind the market so close, so thin at the margins. It is so competitive that that is how they have to run their business.
What are they going to be faced with under this government? A tax that is going to push up all of the costs of their imports. Garry and his team down at kinetic will have to pick up that increased cost. They have increased costs of their own as they fabricate steel products in a diversified business, and they will have to somehow compete with imports from China. Our manufacturers need to be world-class every day, and this Labor Gillard government is doing nothing at all to help them.
Those people see their economic opportunities and futures going up in the air because of Labor. You know what else is going to go up in the air? Emissions, because they will not be saved here in Australia. Not only will the jobs go up in the air; the emissions will go offshore and more will go up in the air. So there is no upside for the environment. There is no upside for our atmosphere. There is no upside for our country. Fewer people will have jobs, and less wealth will be created in this country. We will export those manufacturing processes and businesses where energy inputs are crucial to economic survival. What is the logic of that?
What is worse about this policy is that it does not achieve anything that the government says it is going to achieve. You could call that a placebo policy, couldn’t you? They talk up a good game and achieve none of it. But placebos are not harmful. They are in the mind of the people. Labor think this makes a difference, and anyone who challenges them is vilified. A placebo causes no harm, but this policy causes plenty. It is long past the time Labor turned their mind to realising that, rather than punishing and penalising with a punitive tax that hits every person, every household and every business at every stage of activity.
Why don’t they open their minds to what the coalition is proposing, where there is actually an incentive, a reward for reducing emissions? We can be partners in that emissions reduction. We can put incentives in place that for those can produce verifiable abatement. We can deliver the five per cent target—exactly the same target Labor is talking about—without shirt-fronting business.
I heard today the Prime Minister talk about the virtue of constancy of purpose. Give me a break. (Time expired)
In 1989, when US President George HW Bush proposed the use of market based mechanisms to deal with acid rain, electricity generators warned him that their costs would skyrocket. Today, the program is universally regarded as a success, achieving its emissions targets at around one-third of the projected costs. Why are market based mechanisms so much cheaper at cutting pollution? In the case of acid rain, it turned out that firms used a variety of approaches to reduce emissions. Some retrofitted emissions control equipment. A number switched to cleaner fuel. Others retired their dirtiest generators. Because each firm took the lowest cost approach to abatement, the social cost was minimised.
For environmental economists, this result merely reaffirmed theoretical work of Arthur Pigou in the 1930s and Ronald Coase in the 1960s. By the time the member for Flinders won a prize for his 1990 university thesis A tax to make the polluter pay, the economic theory was widely recognised. The member for Flinders pointed out:
An attraction of a pollution tax regime is that it produces a strong incentive for firms to engage in research and development.
And that, for consumers:
… goods which do not generate—
pollution—
in their production will become relatively cheaper and therefore more attractive.
Discussing the politics surrounding pollution taxes, the member for Flinders argued that ‘a pollution tax is both desirable, and, in some form, inevitable’ but acknowledged that ‘even if some of the Liberals’ constituents do respond negatively, a pollution tax does need to be introduced to properly serve the public interest’.
Today, those opposite are the party of ‘no’. But not so long ago, only 16 short months ago, they were reformers. They were a party of markets. Senator Judith Troeth on 30 November 2009 said:
By having a price on carbon, people can decide whether they really want to use these carbon-intensive products. It is an effort to move people away from carbon towards other alternatives, and the most effective and efficient way to do this is through a price signal. The other consequence of the price signal is that it makes alternative sources of energy viable, and I am strongly of the belief that the nature of public opinion is changing as more people accept that carbon based energy is less desirable.
The member for Paterson, Mr Baldwin, told the House on 3 June 2009:
I would like to make it clear: the coalition will support an emissions trading scheme …
The member for Fadden said:
The opposition support an emissions trading scheme as one of the tools in a climate change toolbox. Other issues that should be considered include carbon sequestration—
and a ‘voluntary carbon market’. As the member for Wentworth said, though, ‘things changed’—things changed substantially. The member for Wentworth wrote on his blog:
Tony himself has, in just four or five months, publicly advocated the blocking of the ETS, the passing of the ETS, the amending of the ETS and, if the amendments were satisfactory, passing it, and now the blocking of it.
His only redeeming virtue in this remarkable lack of conviction is that every time he announced a new position to me he would preface it with “Mate, mate, I know I am a bit of a weather vane on this, but …”
The member for Wentworth told ABC radio:
My views on climate change—the need for a carbon price, the fact that market-based mechanisms are the most efficient ways of cutting emissions—my views are the same today as they were when I was part of John Howard’s cabinet, and those views were held by the Howard government.
By the time the member for Flinders wrote his thesis it presented the view that most small ‘l’ liberals around the globe have held for decades. Those opposite like to tell us that no-one else in the world is acting, but of course the US conservatives are proud champions of their nation’s emissions trading scheme.
Thirty-two countries and 10 US states have emissions trading schemes. Market based mechanisms are everywhere. Why is that?—because, just as the scientists tell us that climate change is happening and that humans are causing it, so the economists tell us that market based mechanisms are the most efficient approach.
As recently as 2007 the Liberal Party’s election platform promised:
To reduce domestic emissions at least economic cost, we will establish a world-class domestic emissions trading scheme in Australia (planned to commence in 2011).
The Gillard government proposes to start with a carbon price in which the market determines the quantity of pollution before transitioning to a fully flexible emissions trading scheme in which the market determines the carbon price. Both are market mechanisms. Both have the advantage that they allow millions of households and businesses to find the most cost-effective way to reduce dangerous carbon pollution. For the first time it will become profitable for entrepreneurs to find ways of reducing carbon emissions.
Because the arguments for harnessing markets to cut carbon pollution are essentially the arguments for free markets themselves, the opposition to emissions trading has traditionally come mostly from the left of the political spectrum. It was the left of the political spectrum that objected when, in 1989, President George HW Bush said that market based mechanism should be used to deal with acid rain. Yet today we have the odd spectacle of a supposedly market friendly party advocating a climate change policy that looks awfully like command and control.
If you think we can cut smoking rates more effectively by subsidising celery sticks than taxing cigarettes you will love Tony Abbott’s direct action plan. Of course you cannot, which is why the only way the coalition can meet its emission targets is by spending $20 billion buying permits from other countries.
While the coalition is running a million miles from market based reform, this government is getting on with the job of serious long-run economic reform—investing in the future. Today, the Treasurer and Minister for Resources and Energy announced that the government is accepting all 98 recommendations of the Policy Transition Group for the minerals resource rent tax. That will mean a boost to national savings, a cut to company tax rates and an investment in infrastructure. That infrastructure will go particularly to the mineral rich states of Western Australia and Queensland. Australians will get a fair share of the resources they own and will manage the mining boom in a way that supports the huge pipeline of investment.
But those opposite have become the party of ‘no’. They will reject the $7.4 billion the miners are willing to pay. They will reject the cut in the company tax rate which flows through to mums and dads who shop in Woolies and Coles. They will reject the tax cuts to small business; they will reject the boost to superannuation—a much-needed increase in retirement savings that will improve dignity in retirement for millions of Australians. And they will reject the investment in infrastructure.
They are indeed the party of ‘no’. They are even saying no to reforms which will ensure that Australians will not face exit fees of up to $7,000 on a mortgage. Last night we introduced regulations into this chamber that will ensure that that will happen from 1 July, but those opposite are standing up against that.
We know why this is the case. The Leader of the Opposition has always been a man of ‘no’. He brought his negative approach to public life in 1989, when his campaign against the republican referendum was: ‘Don’t know? Vote no.’ He came to the leadership with only one promise: that the Leader of the Opposition would say no to any sensible policy to tackle dangerous climate change. He continued being the man of ‘no’ on the issues of means testing the private healthcare rebate and the Building the Education Revolution program—a once-in-a-generation investment in our nation’s education infrastructure.
There are thoughtful people in the Liberal Party caucus. There are those who occasionally speak out in favour of ideas rather than carping criticism. There are people who could make a constructive contribution to the multiparty committee on climate change, if only their leader allowed them to do so. But, alas, the reformers are shouted down by the blockers.
This is a dangerous game that those opposite have got themselves into. It might feel good to be the party of ‘no’ but this kind of short-term populism is a risky strategy: you will quickly find there are people out there who are more simplistic and more negative than you. The organisers of yesterday’s rally said on their website:
CO2 is not pollution and does not need to be reduced in the first place.
What we are seeing here has its parallels in the US—the rise of carping negativity and Tea Party style politics. The re-entry of One Nation wrapped in a blue ribbon is what we are seeing here today. (Time expired)
I have received a message from the Senate informing the House that Senators Carol Brown and Cameron have been appointed members of the Joint Standing Committee on the National Broadband Network.
Bill returned from Main Committee without amendment; certified copy of the bill presented.
Ordered that this bill be considered immediately.
Bill agreed to.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Bill returned from Main Committee without amendment; certified copy of the bill presented.
Ordered that this bill be considered immediately.
Bill agreed to.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Bill returned from Main Committee without amendment, appropriation message having been reported; certified copy of the bill presented.
Ordered that this bill be considered immediately.
Bill agreed to.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Debate resumed.
The question of remuneration paid to senior executives of large, publicly listed companies is often controversial. It is an issue which raises strong passions in the community, and it is easy to understand why when one sees some instances of very large amounts of money being paid to people when it is a little difficult to understand the value that they are generating. So it is a question that is very easy to politicise, and of course the government that we have today is not one that ever resists the temptation to politicise an issue which is easy to politicise. The bill that we have in front of us now, the Corporations Amendment (Improving Accountability on Director and Executive Remuneration) Bill 2011, emerges from an inquiry conducted by the Productivity Commission which, in turn, was commissioned by this government in response to what it perceived to be community concerns about the remuneration of senior executives.
I want to make three points in the time that I have available to me. The first point is to acknowledge that there are instances where people working for large corporations—senior executives or directors—are paid very large amounts of money, amounts which seem very hard to square with the claim that they are generating shareholder value. The second point is that the Productivity Commission inquiry into this complex area is a balanced and fact based inquiry, and it is pleasing that it is in such a state, particularly given, as I have mentioned, the great temptation to politicise these issues. The third point is that the key question which policymakers have to consider is whether it makes sense to introduce further specific regulatory measures designed to address the problem that there are certainly instances of excessive amounts of money being paid and whether the benefits of doing so exceed the costs, which inevitably follow such an additional imposition of prescriptive regulation.
Let me turn firstly to the point that it is easy to identify horror stories of enormous amounts of money being paid to executives of companies in circumstances where it seems very difficult to identify the value that they have purportedly delivered to justify such large amounts being paid. It is clearly the case there are instances from time to time of amounts of remuneration being paid—often associated, for example, with large termination payments—which are out of kilter with community expectations and which attract criticism. There have been a couple of instances that one can think of in the past 10 or 15 years that, as it happens, both involve executives imported from the United States at vast expense, and it is very difficult to identify the benefit that they have delivered to shareholders in their company for the enormous amounts of money that they have been paid.
One such executive was George Trumbull and his years at AMP. More recently, Sol Trujillo at Telstra was paid very large amounts of money, and it is instructive to briefly consider those circumstances. He was hired on a base salary of $3 million, plus a short-term incentive of $3 million. In 2007 his contract was varied so that the $3 million base was maintained, but the short-term incentive suddenly went from $3 million to $6 million. Telstra’s 2007 annual report put his total remuneration level at $11.8 million, vastly more than any other executive of Telstra. A chief executive being paid more than other executives is not inappropriate in itself; but, curiously, his contract allowed him to resign with only 30 days notice, as compared to the standard six-month notice provision in the contracts of all other senior Telstra executives. Of course—lest there be any misunderstanding—Mr Trujillo delivered himself in August 2006 of this immortal observation:
I’m not doing this for the money, right. I’m not doing it for the pleasure, I’ve already had bigger titles than this.
It is fair to say that many Australians were a little bit sceptical about the claim that he was not doing it for the money, and I need hardly remind the House what a dreadful mess he got Telstra into. When Mr Trujillo arrived, the share price of Telstra was $5.20. Today it is in the range of $2.60 to $2.70—I have not checked it today, but a couple of days ago it was at $2.64. So it is very hard to identify the value that Mr Trujillo has delivered, and he was paid enormous amounts. Nobody would contest that there are instances of senior executives being paid very large amounts of money when it is hard to justify the payments in that specific instance.
The Productivity Commission inquiry has given a good, fact based survey of the issue involved here, and I congratulate them on their work. A number of points can be drawn from the report. Firstly, good decisions by chief executives and senior executives can have a very significant, positive impact on shareholder value. In other words, the decisions these executives are making, if they get them right, will deliver very large value to shareholders.
The second point is that Australian corporates operate increasingly in a global marketplace, and that includes the global marketplace for talent. The Productivity Commission acknowledges that point. It is also important to note—as the Productivity Commission does—that, if pay is structured wisely, if there is appropriate performance pay paid to senior executives and if the structure of their contract gives them the appropriate incentives, you can secure the best performance of those executives in the discharge of their jobs and you can also address the problem of ‘agency’. This is the well-known phenomenon where executives of a company can find themselves making decisions which are in their own personal interest rather than in the interests of the shareholders. The ‘agency’ problem is a well-known, long-established problem. One way to deal with it is to have appropriately structured remuneration contracts which put significant amounts of the senior executive’s remuneration at risk—that is, only paid if they actually deliver substantial improvements in value for shareholders.
The Productivity Commission made the point that there are some problems with executive remuneration, particularly where you have, for example, a board which is very compliant with the requests and desires implicit or explicit of senior management. That can be a particular problem in the United States, where it is quite common practice for the chair and the chief executive to be the same person. In Australia that is much less common.
The Productivity Commission also makes this important point: by world standards, corporate remuneration in Australia is not excessive. We remain below levels typically paid in the United States and in the United Kingdom, and payments to executives in Australian companies generally are in line with those in the smaller European economies.
The report makes another very important point: a correlation has been demonstrated between good and bad economic times on the one hand and company performance and in turn the pay of executives. The specific correlation, obviously, needs to be between the company’s performance and pay. What has been demonstrated in the Productivity Commission’s report is that, during the global financial crisis, there was a decrease in chief executive remuneration, reflecting, in turn, poorer company performance.
The Productivity Commission reaches this conclusion—and it is one that I certainly strongly support:
… the way forward is not to bypass the central role and responsibility of boards in remuneration setting, especially through prescriptive regulatory measures such as mandated pay caps.
What then is the appropriate way forward? That brings me to the third issue I wanted to address—what seems to me to really be the key question here: does it make sense to introduce further, specific regulatory measures to address instances of excessive pay and, very importantly, do the benefits of introducing such measures exceed the costs?
Let us be clear: there is no contest on this side of the House that the agency problem is a significant one; and there is no contest on this side of the House that from time to time we see instances of executives being paid very large amounts of money which seem by any standard difficult to justify. It does not follow from that that any given piece of regulation is a sensible one to introduce. It is true that this Labor government has a huge face in the power of prescriptive microregulation. They have never seen a problem that would not, in their view, benefit from some more guidelines, more reporting requirements, more templates, some regulation, some directives and mandatory standards. They are very keen on all of that. Detailed, prescriptive interference with the day-to-day operations of businesses and organisations of all kinds is very much in line with the philosophy of the Gillard Labor government. Their general line of thinking runs as follows: ‘We’ve identified a problem, part 1. Part 2, we’ve put up legislation which we say offers a solution. Part 3, therefore, it must be good.’ That logic is not correct.
As is the case with all measures, these regulatory measures have a cost, and the cost of those measures must be weighed against the benefit. As you build up an increasing agglomeration of regulatory burdens and requirements on business over a number of years, it has an increasingly deleterious impact. More and more of the time of directors and senior executives is taken up with dealing with regulatory requirements. They are distracted from their main job, which is doing the work of the company and delivering shareholder value. There is an allocation of time, of resources, of energy, of cost. So any regulation ought to be very carefully considered before it is simply endorsed.
In that regard, it is relevant that on the question of excessive corporate remuneration there are already remedies available to shareholders. If they are sufficiently exercised and if that concern rips shareholders in sufficient numbers, they can vote out the board or they can move a resolution binding upon the company. They can, obviously of course, also sell their shares, vote with their feet and invest in companies which have remuneration practices more to their liking.
I do not say these things are easy. I do not say that it is an easy thing to achieve a sufficient number of votes of shareholders to vote out a board, but I say that these remedies are available to shareholders, and shareholders are the ones who have the strongest interest and the strongest incentive to ensure that remuneration levels are set appropriately but not excessively to reward the kind of behaviour that they are looking for managers, but to not be ripped off.
Against that backdrop, it cannot be disputed that the Productivity Commission proposals are quite onerous and prescriptive. Particularly we have got this ‘two strikes and you are out’ mechanism. I note parenthetically that if it were the case that the US bought a baseball from which three-strikes legislation and this variant two-strikes is derived and, instead, gave the batter five strikes or 10 strikes, many pieces of public policy might be quite different. But that is a parenthetical observation.
I make the point that this is quite a prescriptive requirement. If there is a 25 per cent vote against a remuneration report one year and that vote is repeated in the next year, there is then an automatic requirement to spill the board and to call an extraordinary general meeting 90 days later to elect a new board. That is a very detailed and prescriptive piece of regulation. It is consistent with this government’s enormous faith in regulation and intervention. I put to the House that we have not seen much evidence to justify that confidence.
So as a matter of principle on this side of the House, we tend to be more sceptical than the government about the benefits that any regulation will deliver and we tend to be concerned about the costs that will be incurred as a result of the new regulation being imposed. It seems to me that those issues present themselves quite squarely in this case. Nevertheless, as the House has already been advised, we will not be opposing this bill, although we are moving an amendment which we say reduces to some extent the prospect of capricious and unexpected consequences from the ‘two strikes and you are out’ rule. It is a sensible amendment and one that I commend to the House.
Debate (on motion by Mr Perrett) adjourned.
Ordered that the adjourned debate be made an order of the day at a later hour this sitting day.
Order! The sitting is suspended until the ringing of the bells.
Sitting suspended from 5.02 pm to 10 am, 28 March 2011
I rise today to speak in support of Ron Sinclair, a constituent of mine, who has had an awful ordeal dealing with a camper mobile home vehicle that he purchased. It proved not to be the vehicle that the Commonwealth said it was when it allowed the importation of the vehicle—that is, not roadworthy, as it was claimed to be, and not able to be registered although it was actually registered with VicRoads. Ron has gone through an extraordinary ordeal at great personal emotional cost and financial expense, only to find that a so-called 1993 Chevrolet K2500 was not in fact the vehicle that matched the compliance plate that accompanied the vehicle. The vehicle is overweight and cannot be used on Australian roads, despite it having gone through an extensive process under the Commonwealth’s used low volume scheme that is administered federally by the department of transport—an issue that I have raised with Minister Albanese.
We are looking here for an outcome that is fair and just to Mr Sinclair. He has been able to—through successive actions, through administrative tribunals and legal avenues—have funds refunded to him for the purchase price of that vehicle but he has not been able to get his costs back. He has not been able to get his costs back because the administrative tribunal in Victoria will not allocate costs unless there have been some legal proceedings to prosecute people who have been found to have broken the law. This is a classic case of the Commonwealth and state governments failing to do their jobs, where the expense of seeking justice has rested very heavily with Mr Sinclair, and now that he has been found to be correct in each and every circumstance of the claims and the maladministration that has bemoaned this entire process, he is still tens of thousands of dollars out of pocket.
It is not adequate for the Commonwealth to simply wash its hands and say that there are processes in place. The reality and the simple fact is that certain documentation certificates that were accepted by the Commonwealth—where the processes were commenced to allow this vehicle to come into Australia and be sold to Mr Sinclair—were not properly handled. Information was not joined up with parties who were supposed to have overseen the standards of these vehicles to make sure that they complied with our design rules. It is not good enough for VicRoads in Victoria to say, ‘It was the Commonwealth—it was the feds.’ They are supposed to make sure all these vehicles meet design requirements before they come into Australia. Therefore, the state government and the Commonwealth are each saying ‘It wasn’t us.’ They should have done something to protect Mr Sinclair.
The bottom line is that Mr Sinclair has been hung out to dry. He is left out of pocket for tens of thousands of dollars. His hopes of using his campervan to tour the country have simply led him being taken for a ride and to travel through all of these court jurisdictions. I call on the Commonwealth to make an ex gratia claim for defective administration for exposing Mr Sinclair to this cost. He should not be out of pocket for doing the right thing. (Time expired)
I rise to highlight the achievements of the local operations of CNH Australia, based in St Marys in my electorate. I recently had the pleasure of attending the official opening of CNH Australia’s new St Marys warehouse extensions and training facilities. The St Marys operations are part of CNH’s global agriculture division and employ more than 180 full-time staff with extra casual staff during peak times. The creation of their new state-of-the-art training facility will benefit domestic and international customers, allowing CNH to support and train them on current and future products. The expansion of this facility has been made possible due to the company’s growth here in Australia and the dedication of a number of people at different levels within the company.
Before CNH committed to the expansion of their current site, they reviewed their presence in Western Sydney and compared their current location with other industrial areas in New South Wales and other states. They concluded that St Marys continued to be the best location for them, with access to major road and rail infrastructure and relatively close proximity to international airport facilities. I am proud to see that large multinational companies like CNH are investing not just in Australia but also in communities like mine in Western Sydney. CNH is making an enormous contribution to our local community by directly creating almost 200 local jobs, which in turn generates flow-on benefits to the local and regional economy.
This is a great example of why our region is an excellent place to invest. As one of the largest economies in Australia, Greater Western Sydney is increasingly a destination for many companies like CNH that want to tap into a hard-working and highly-skilled workforce and have easy access to major transport corridors. I thank CNH for their commitment to Western Sydney and I look forward to seeing their continued success in our region well into the future.
I also congratulate some of the people involved in the expansion project, including Dean Hopping, general manager of parts operations in Australia and New Zealand; Ray Osgood, vice president of parts sales and marketing for countries outside North America and Europe; Robert Quinn, general manager of parts sales and marketing; and Ian Fisher, financial controller. I make special mention of all of the staff at CNH St Marys, including Dave Jones, the warehouse manager, and his team whose dedication to the company made sure that the warehouse continued to operate during the expansion. Despite the disruptions to their workspace during the extensions, the CNH St Marys operations were not only able to continue to supply customers with parts but they also reduced the turnaround time between when an order comes into the warehouse and when it gets to the customer. Congratulations again to the team at CNH on the opening of their new warehouse extensions and training facilities and for their ongoing commitment to the St Marys community and the broader Western Sydney region.
I would like to present two petitions which have been found to be in order by the House of Representatives Standing Committee on Petitions.
The petitions read as follows—
To the Honourable The Speaker and Members of the House of Representatives
This petition of citizens of Australia, draws to the attention of the House the overwhelming community support for the Victorian Government’s current trial of cattle grazing in the Alpine National Park to help reduce the severity of future bushfires in the high country.
And further, condemns the Private Members’ Bill introduced by the Greens Member for Melbourne Adam Bandt which seeks to ban cattle from the Alpine National Park.
We therefore ask the House to oppose the Greens Private Members’ Bill when it is debated in Federal Parliament.
from 1,063 citizens.
To the Honourable The Speaker and Members of the House of Representatives
This petition of citizens of Australia who travel in the Gippsland region, draws to the attention of the House the inadequate condition or the Princes Highway between Sale and the New South Wales border.
In particular we note:
We therefore ask the House to support the adding of the Princes Highway east of Sale to the National Road Network to give it access to Federal Government funding.
from 613 citizens.
Petitions received.
The first petition refers to the issue of alpine grazing. My time is short today so I would like to refer my constituents to my comments on this issue in the House earlier this week. I certainly support the 1,063 petitioners and it was a great effort to assemble so many signatures in just 10 or so days. This is quite a contentious issue. I acknowledge there is some opposition to this particular move by the Victorian government but the overwhelming support is for the Mountain Cattlemen’s Association of Victoria and the work they are doing to help reduce the severity of future bushfires.
The second petition refers to another issue that I am particularly passionate about, and that is the inadequate condition of the Princes Highway between Sale and the New South Wales border. In that petition 613 people noted the high accident rates on this section of the highway, which is one of the state’s most dangerous sections of road. From 1 April 2004 to 31 March 2009 there were 314 reported crashes on the Princes Highway East, with 497 people injured and 28 people killed.
The highway between Sale and Traralgon is eligible for federal funding and there are some duplication works underway that I am working with the transport minister on. This has been the subject of bipartisan support over many years. But the section of road between Sale and the New South Wales border is not part of the national road network and is in desperate need for additional funding.
This is not about playing political games; it is about saving people’s lives. I call on the federal minister and the state minister to work in a bipartisan manner with me and the newly elected state member for Gippsland East, Tim Bull, to achieve some results on behalf of the travelling public and local residents. This is important from a tourism perspective and for commerce and industry of the East Gippsland region and absolutely vital for saving lives. I call on both ministers to work with us in that regard.
Finally, I want to raise one other issue that concerns me and the people of Gippsland, and that is this government’s failure to guarantee ongoing funding for the Rural Financial Counselling Service. I have received a letter from the Chairman of the Gippsland Division of the RFCS, Lou McArthur, about the fact that the service is coming to the end of a three-year funding agreement on 30 June. The service staff have been told that there will not be any announcement until the federal budget. I call on the Minister for Agriculture, Fisheries and Forestry to end the uncertainty and commit to ongoing funding immediately.
At a time when farmers in Gippsland have just received the news that exceptional circumstances funding will not be provided after 30 April this year, we need this service to continue. I believe Lou McArthur makes some very good points in her letter, which I have forwarded to the minister. She indicates that this uncertainty makes the planning and efficient operation of the Rural Financial Counselling Service very difficult and it places the Rural Financial Counselling Service at risk of losing highly skilled employees due to uncertainty of employment at a time when in many parts of the region the need for these services is as great as ever.
This is a desperately needed service. I call on the federal government to commit to ongoing funding to ensure that our farming community receives professional assistance at a time of great need in Gippsland. (Time expired)
The honourable member for Gippsland is quite correct. Those two petitions have been approved as being in order by the Petitions Committee. Those petitions are received pursuant to standing order 207(b)(ii).
I want to remark upon some wonderful individuals in my electorate. I think we would all agree that it is important to encourage and support young people who demonstrate a commitment to their communities and to active public leadership. Now in its second year, the Gorton Young Leaders Awards are my way of recognising local young people who have shown an exceptional commitment to public service, specifically through involvement in voluntary work, student leadership or community service.
I am extremely pleased to inform the House that the electorate of Gorton has again produced a number of outstanding young leaders. The achievements of these leaders were diverse, ranging from work with local parish communities, volunteer work for the Salvation Army and its Big Brother program and fundraising activities for Timor-Leste. Eighteen former year 12 students from across nine schools were awarded a Gorton Young Leaders Award for 2010. The winners were: from Catholic Regional College Sydenham, Nicole Calleja and Kevin Singh; from Copperfield College, Jagvir Johal and Phillip Martinovski; from Gilson College, Ibukunoluwa Oluwasola and Jonathan Joseph; from Keilor Downs Secondary College, Vitoria Guimaraes and Jacky Truong; from Marian College, Renee Nguyen and Diana Nguyen; from Overnewton Anglican Community College, Rachel Potter and Kyle Downward; from Taylors Lakes Secondary College, Tanya Vidanoski and Matthew Karipoglou; from Victoria University Secondary College Brimbank, Angela Josifoska and Adam Gauci; and from Victoria University Secondary College Deer Park, Paulina Nagorski and Dang Nguyen.
Last week I had the great pleasure and privilege to meet with these young leaders, their parents and college representatives at a morning tea that I convened in my electorate office in Keilor. It was a very successful and well attended event. I know that the winners enjoyed themselves. They conveyed that to me on the day. I look forward to charting the progress of these young leaders in the years ahead. Indeed, they are exemplary role models for not only the western suburbs of Melbourne but the country at large. The achievements of these young leaders reflect highly not only on each individual concerned but also on their parents, schools and greater communities.
I am sure the House will join me in congratulating them on their efforts and wishing them every success going into the future.
I seek leave to table this petition as a document of the House.
My understanding is that the petition is not in order to be received as a petition. However, you are able to table it as a document provided there is no objection. As there is no objection, the document will be received on that basis.
Thank you. Today I present this document to the House of Representatives on behalf of 4Farmers, a national farming agent involved with importing and distributing agricultural chemicals Of their own initiative, 4Farmers have worked to put together this document which has gathered more than 500 signatures to seek to draw to the House’s attention the issue of chemical tariffs on imported farm chemicals. The document reads as follows:
This document of Australian farmers draws to the attention of the House the presence of import tariffs on finished farm chemicals and technical grade active constituents of farm chemicals. A five per cent tariff is applied to a range of common agricultural chemicals which ultimately results in an additional cost to farmers.
The document asks the House to remove all import tariffs on finished farm chemicals and technical-grade active constituents on farm chemicals, and is signed by 521 citizens. I would further like to draw the Australian government’s attention the dire circumstances many farmers are facing as a result of a number of bad years capped off by severe droughts in WA and severe floods in Queensland and other areas.
It is estimated this tariff costs farmers around $1 dollar per hectare. The removal of this tariff could see the individual farmers saving thousands of dollars. There may also be an issue of the tariff hampering local competition. While larger farming agents are able to manufacture chemicals within Australia to avoid the tariff, smaller agents are only able to import and distribute chemicals and are forced to pay a higher price because of this.
I thank the House.
I rise on a very sad occasion today to pay my respects to a very dear woman: Betty Bollenhagen from South Australia. Betty was a loving wife, mother and grandmother and also a lifelong volunteer loved by all who knew her.
Betty Bollenhagen was born on 5 January 1938 and, sadly, passed away on 10 March 2011 aged 73 years. Betty will be sadly missed by her family but also greatly missed by all the people and community groups with which she was involved. Betty became involved in the Scout Movement at 18 years of age and remained involved for the next 50-odd years. She became a cub leader and then became a pack leader within the Scout Movement. She was honoured by the Scout Movement for her tireless contribution and her 50-years of service a few years ago.
In 1998 Betty joined the Active Elders, a senior citizens movement based in the Ascot Park area in my electorate. It is the group through which she and I became acquainted and became very good friends. Clearly seeing her tremendous capacity for volunteer effort, she was made secretary program officer of the club one year later and remained in that position right up until her passing. Betty and her husband, Malcolm, worked tirelessly, raising funds to subsidise the Active Elders group’s club rooms, recreational equipment, social gatherings and outings that gave so much joy to senior citizens in my electorate. One fundraising effort that I helped with I can recall quite clearly involved the gathering of hundreds upon hundreds of newspapers, bundling them together and selling them in 10-tonne lots to a packaging company to raise funds to support the club. It is amazing the strength of the Active Elders club in bundling tonne upon tonne of newspaper, lugging it from their club storage area and throwing it up onto the back of a truck. These pensioners really are active and are highly respected, and Betty Bollenhagen was always at the centre of the activity.
Betty was named Citizen of the Year by the City of West Torrens, and received numerous awards and accolades from various groups and associations recognising her tireless volunteering efforts. Betty fought and lived through three bouts of cancer over recent years, but finally succumbed to that most persistent of scourges.
Her funeral was held at Centennial Park on Friday, 18 March and was attended by hundreds. She is survived by her husband, Malcolm, and three children—Robert, Peter and Helen—and grandchildren. Betty Bollenhagen was one of the dearest and most delightful people one could ever hope to meet—full of life; full of love. She will, indeed, be very sadly missed by all in the community in our area.
Each year it is a great privilege and honour for me to be given the opportunity to officiate at the Australia Day ceremony at Sussex Inlet. The conferring of citizenship upon people can be a tremendously gratifying experience as the joy in the individual who becomes an Australian feeds into your own soul. It is an emotional moment, but the real depth of feeling did not become apparent to me until I read the following letter from one of our newest Australians, Gillian Robinson of Sussex Inlet. With your indulgence, Mr Deputy Speaker, I would like to share her letter with the House. Gillian writes:
I thought you might like to read of my journey towards the Australian Citizenship which I was proud to receive on Australia Day at the Sussex Inlet Lions Club Park.
It is a story covering a 70 year period!
I was born in Uganda in 1933 of British Colonial Civil Servant parents, finally leaving to return to Britain at the end of WW2.
In Uganda, when I was 7 years old, my father read to my brother and myself, as a bedtime story, a book he had been awarded in 1914, at the age of 11, in Blackheath, England as a school Arithmetic prize.
That book, which I now own, was ‘Timothy in Bushland’ by Mary Grant Bruce, published in 1912 as one of a number of Ward Lock & Co’s “Gift Books, Prizes and Rewards”.
I was enthralled by the story and made up my young mind that I would one day find my way to Australia.
The years passed and I traveled and lived in many countries until at last in 1989 my daughter came to Australia as a back-packer.
I saved up all my annual leave and ‘time-in-lieu’ from work and finally flew to Australia to spend six weeks at Christmas and the New Year with her.
It was, as I thought, the only opportunity I would ever have to see the country which had inspired my childhood dream and it did not disappoint!
I was photographed on the Opera House steps and with the Bridge as a background, spent my 56th birthday in Grafton Botanic Gardens, flew to Uluru and Katajuta, traveled by bus all up the northern NSW and Queensland Coast, flew by amphibious plane out to the Barrier Reef, sailed on “Gretel”, the America’s Cup challenger and on “Apollo” a Sydney to Hobart contender and kept a detailed journal of this magnificent adventure!
More years passed, circumstances changed and after previously spending two years on an ‘exchange’ visit, in 1999 my daughter together with her husband and three young children emigrated from the UK to Australia to live in Nowra.
I visited as a tourist time and time again. Finally, with the encouragement of my son and daughter, I decided to try to emigrate in the ‘aged parent’category and on being accepted, waited on my Bridging Visa for 7 years, before being given my Permanent Residency on 2nd July 2008.
The culmination of this life time’s “dream of Australia” was the ceremony at Sussex Inlet on Australia Day, 26th January 2011, when I was at last granted my Australian Citizenship, thus proving that you should never give up on a dream, even a dream of 70 years duration!
My thanks are due to my son and his wife and to my daughter and her husband for their encouragement in my adventure towards my dream.
To Mr and Mrs Ross Westley of Sussex Inlet Lions Club, to Joanna Gash MP who awarded me my Citizenship, to Shelley Hancock MP, the Lions Club dignitaries and members and to all the other new Citizens, all of whom contributed to the success of a very special day.
With sincere thanks - Gillian Robinson.
Mr Deputy Speaker, I will let those words speak for themselves.
Last week I had the misfortune to have to present myself to Liverpool Hospital for an examination, and regrettably I had to have a small lesion taken off my chest. After the operation I was talking to the staff specialist, Dr Cains, who I have known for many years. He is a senior dermatologist attached to Liverpool Hospital. Regrettably there is not a professor overseeing dermatology at Liverpool any longer. The professor who was there has moved overseas, and Dr Cains fulfils the role of medical specialist. He not only conducts consultations with patients but also he is involved in training of staff and, more importantly, training GPs and future specialists in dermatology.
Dr Cains indicated to me that the hospital is in urgent need of a full-time professor in order to fulfil its split requirements in teaching and patient care. For the past six years the administration of the department has been conducted by an acting head who attends once a week. The teaching and clinical work as well as supervision of trainees is all overseen by a single staff specialist. Bear in mind that Liverpool Hospital has had $395 million invested into it by the New South Wales government. It is doubling its size. I understand that, when complete, it will be the largest hospital in the Southern Hemisphere, but regrettably there will not be a professor of dermatology at that institution.
Liverpool Hospital is a principal teaching hospital and research facility for the University of New South Wales and the School of Medicine of the University of Western Sydney. I have taken the opportunity to write to the government and to the University of Western Sydney asking for consideration to funding a professorial seat at the hospital to undertake this work. Regrettably, there are very few teaching institutions that specialise in skin based research. Liverpool Hospital could be a world leader. This is very important when you consider that 25 per cent of all GP consultations are for skin related diseases. The current epidemic of melanoma and non-melanoma skin cancer in Australia further increases the need for teaching and research in this area. I hope that Liverpool Hospital will become an institution for research for the future. (Time expired)
I would like to raise again an issue raised by the member for Murray some time ago, which is the outbreak of blackwater events through the Murray-Darling Basin, particularly the southern sections of it, which has been occurring since September as a result of the phenomenal meteorological events that have occurred throughout the southern parts of the continent. The first of these blackwater outbreaks occurred on the Wakool River back in September and through October, with alarming impacts on the mortality of fish, particularly Murray cod. It was very sad to see half-metre-long Murray cod floating belly up along the Wakool River in that period. A Murray cod of that length is at least 40 years of age, perhaps even 50. We have worked extremely hard over the years to ensure the longevity of these fish. It is just a tragedy to see them floating dead down our river system.
Then, just before Christmas, with the second of the huge meteorological events, came the blackwater outbreak that flowed out of the Barmah Forest and saw the Murray River impacted. It was phenomenal to see crustaceans, Murray cray, going up the banks of the Riverside Park in Swan Hill to survive—quite a tourist attraction it was. They were escaping the lack of oxygen because of blackwater in the Murray River. It was quite interesting to see so many Murray River cray. We were told they had gone extinct, yet they were there unseen and were forced out of the water because of this plume of blackwater.
There has been much to learn as a result of the breaking of this drought—such a long period of drought; low rainfall for almost 15 years—including how to deal with the floods and everything else that has emanated from the unbelievably strong meteorological outcomes that have occurred through the Murray-Darling Basin. It is quite fascinating to me, as the member for the arid Mallee, to declare that in Mildura last Saturday night there was another 3½ inches of rain in one rainfall event over about four hours. It is confirmation that precipitation outcomes are changing in the Murray valley.
Blackwater events occur as a result of accumulation of organic matter. We have got to find much better and cleverer ways to use the environmental water that is being purchased to create larger, more natural flood events to ensure this phenomenon does not happen again. (Time expired)
I have said many times that Geelong is on the front line of the climate change debate in this country. We are a city by the sea with an economy driven by carbon-intensive industries. This means that we have an economy and jobs dependent on carbon and at the same time we have low-lying regions along the coast vulnerable to rising sea levels. Over the last decade, as the member for Mallee reminded us, we have also been prone to drought.
The Gillard government understands these concerns. We know people want more and better information about the science of climate change, how it will shape our future and the mechanisms for Australia to move to a low-carbon future, which is why I am really pleased that Geelong is the first port of call in the national conversation being led by the recently established Climate Commission.
The commission was set up last month to provide all Australians with an opportunity to learn more about the science of climate change from a team of eminent Australians, leaders in their field, led by the acclaimed scientist and former Australian of the Year, Professor Tim Flannery. The commission will be travelling the country over the next few months talking about the science of climate change, how it will impact us here in Australia, the work other nations are doing to reduce their carbon dependency and, importantly, how a carbon price will work in our economy and our community. This is a conversation that as a nation we need to have—and Geelong is being given the chance to kick it off.
It is a great opportunity for us as a community to come to grips with this issue and, in some ways, lead the way in the national debate. I strongly urge anyone who has been thinking about this issue or who has questions or issues to raise to join in the conversation at the Geelong West Town Hall tomorrow evening. It is also an opportunity for the doubters, like Councillor Stretch Kontelj, to hear from the experts. In a letter to the Geelong Advertiser this week, Councillor Kontelj revealed himself to be a climate change sceptic and, in the process, placed himself on the extreme edge of this debate. He now stands at odds with Malcolm Turnbull and Greg Hunt and half the utterances of the Leader of the Opposition—although, depending on the day, Councillor Kontelj and Tony Abbott may make common cause. Councillor Kontelj may disregard my views, but it will be more difficult to dismiss the opinions of an eminent Australian in the field such as Professor Flannery. This is, of course, the point of the opportunity which the Climate Commission represents. This is a difficult debate where there are established facts about our climate and what is happening to it, and those facts need to be understood to understand the debate.
In my view Australia and its industry needs to place a price on carbon if we are to have competitive industry and the jobs that goes with it in the future. But, whatever your views about the policy Australia needs, there is no longer an excuse to be ignorant about the facts of climate change. The Climate Commission is the opportunity to have all your questions about climate change answered.
I was loath to interrupt the honourable member, but I do remind him of the provisions of standing order 64, which provide that he ought to refer to other members by their electorates or official titles. In accordance with standing order 193, the time for constituency statements has concluded.
Debate resumed from 24 February, on motion by Mr Shorten:
That this bill be now read a second time.
I rise on behalf of the coalition to speak on the Tax Laws Amendment (2011 Measures No. 1) Bill 2011. The bill before the House today deals with four areas of taxation law across three schedules. I can state in the outset of my contribution that the coalition will be supporting this bill and, obviously, all of the measures within it. The bill deals with minor changes to taxation law and sensible measures with respect to natural disasters that are regular changes that occur in taxation law whenever our country confronts the sorts of disasters that it has faced in recent months. In that vein, I will first deal with the two distinct parts of schedule 1.
The first part deals with a tax exemption for recipients of disaster income recovery subsidies. This schedule of the bill amends the Income Tax Assessment Act 1997 to ensure that people who were affected by the terrible floods that we saw in Queensland, New South Wales, Victoria—my home state—and other parts of the east coast of Australia from 29 November last year do not have income tax applied to their disaster income recovery subsidy payments. This will mean that the tens of thousands of Australians who were affected by that significant flooding will not have to bear any further impost as a result of the assistance with which they have been provided by the government. It will also mean that fellow Australians in North Queensland who, more recently, have been battered by Cyclone Yasi will also be covered in this respect. Clearly the coalition supports this measure and, with the government, recognises the hardships that so many Australians have experienced and are continuing to experience during this time. This amendment backs up the words of this parliament with actions in taxation law.
Schedule 1 also provides for tax exemption for ex-gratia payments to New Zealand non-protected special category visa holders. It amends the Income Tax Assessment Act 1997 for New Zealanders holding a non-protected special category visa, which is a special category of visa that has been issued since the beginning of 2001. The amendment ensures that ex-gratia payments made to New Zealanders who have been similarly caught up in the major disasters which have struck Australia since 29 November last year also have their Australian government disaster recovery payments exempted from income tax.
As I said at the outset, these changes, which are embodied in schedule 1 of this bill, are very much the sort of mechanical changes made to the tax law whenever we confront a disaster of the sort that we have recently. The last time I can recall having done this was immediately following the devastating Black Saturday fires in Victoria. Similar provisions were moved at that time by the then Assistant Treasurer and now Minister for Immigration and Citizenship, Chris Bowen, with the full support of the coalition.
Schedule 2 deals with a tax exemption for recovery grants for the 2010-11 floods and Cyclone Yasi. During the recent disasters, the Commonwealth government and the various state governments provided recovery grants under the natural disaster relief and recovery arrangements to small business and primary producers directly affected by the flooding and Cyclone Yasi. That measure was strongly supported by the coalition at the time because these payments are absolutely essential—and you would appreciate this fact, Mr Deputy Speaker Slipper, as you represent a Queensland electorate—to helping local communities get back on their feet, to repairing the damage from the disasters they have faced and to making a contribution to that in the best way possible. In government, the coalition offered this support to small business and primary producers at the time of Cyclone Larry, a devastating cyclone which destroyed much of Innisfail in Far North Queensland.
Just as the coalition did then, the government is now looking to make these grants, which are paid under the category C natural disaster relief and recovery arrangements, non-assessable, non-exempt income. This will mean that the small businesses and primary producers will not be affected for income tax purposes by the payment. Treating the income as non-assessable and non-exempt will mean that the grant will be treated as exempt income and that any losses brought forward by a primary producer or small business will not be reduced as a result of the payment of the grant. This is particularly important for the recipients of this payment and, as I have said, it is a move that has strong bipartisan support and mirrors the sort of support and assistance that the coalition itself provided when it was in government during previous disasters.
The final schedule deals with an unrelated matter—and that is the way with these tax law amendment bills, which are regularly before the House. It deals with the First Home Saver Accounts. These accounts originated from the government—in fact, from the Labor Party when they were in opposition, as an election promise ahead of the 2007 election. The accounts were designed—the Australian public was told by the then Rudd opposition and the then Rudd government—to persuade individuals, through tax incentives and government contributions, to save for their first home. They have been in operation since about October 2008—so 2½ years.
In recent Senate estimates hearings it was revealed, I am advised, that only 24,000 people had registered for Labor’s first home saver accounts. That is despite the former minister at the time claiming 730,000 people would be stumbling over themselves to sign up. The take-up rate has turned out to be just under seven per cent—hardly something for the government to be proud of. Indeed, we can assume that the measure in this tax law amendment bill, which seeks to make changes and to introduce some flexibility, is of itself a measure and an admission of the government’s failure of their word prior to the 2007 election and the failure of their intent in this policy.
The first home saver accounts have not worked because of their complexity and restrictiveness when it comes to individuals being able to access their savings. Currently, individuals are not able to access their savings for the purchase of a home unless one of several release conditions has been met, and if the savings are not going towards the purchase of a home then the savings must, under the current rules, go to superannuation or the retirement savings accounts. The government, after three years and more than 2½ years of operation, has now, in this bill, put forward some changes regarding the release conditions. We are told in the explanatory memorandum that the changes will allow the savings in a first home saver account to be paid to a genuine mortgage after the end of the minimum qualifying period should the first home buyer purchase a home in the interim. That would currently be in breach of the existing qualifying conditions.
The changes within the bill state that when a dwelling has been purchased prior to the release conditions being met any interest earned on the savings will be taxed at the concessional rate of 15 per cent and no further contributions can be made to the account. At the end of the release conditions having been met, the savings within the account can be put towards the genuine mortgage. Only time will tell whether the changes in this bill will improve the take-up rate of the first home saver accounts. Given that the take-up rate is bouncing along the ocean floor at the moment, at under seven per cent of what was projected, you could assume that the moves within this bill will have some positive effect, but just how much only time will tell. This change—obviously a recognition by the government of the failure and the incompetence of its policy design—although belated, is better than nothing in this area.
This measure, along with the other three measures contained in the first two schedules, we will support. As I said, the first two schedules are schedules that this parliament always speedily enacts in times of natural disaster. The final unrelated aspect is something that the coalition welcomes as a sign of the government’s belated admission of its policy failure, but we will have to wait and see whether any positive effects flow from it in the way the government now says, after three years, they will.
I too stand to support the Tax Laws Amendment (2011 Measures No. 1) Bill 2011. This bill will proceed with the three schedules. The first, schedule 1, deals with amendments to the Income Tax Assessment Act 1997 to provide an exemption from income tax for those who received the disaster income recovery subsidy paid to victims of the recent Queensland floods and those affected by Cyclone Yasi. The second schedule will amend the Income Tax Assessment Act 1997 to provide an exemption from income tax for category C Natural Disaster Relief and Recovery Arrangements grants paid to small businesses and primary producers. The third schedule deals with increasing the flexibility of first home saver accounts by ensuring people can commit their savings to a mortgage if they purchase a dwelling within the interim period as prescribed. I will speak on that in more detail later.
I know there have been condolence motions and plenty of discussion in this chamber about a range of things, including, regrettably, a lot of debate about a levy to support recovery efforts in Queensland. The simple thing is that we have gone through the worst natural disaster in this nation’s history, not just in respect of the loss of life but also from the washing away of roads, bridges and, to a lot of people, what they saw as their future, their ambitions and what they held for their kids. Mr Deputy Speaker Slipper, you come from Queensland and know what a high proportion of businesspeople there invest in their businesses. It is not all that easy for someone to say, ‘We’re a stoic people and we’re just going to recover from all this; it will be business as usual come 9 am on Monday.’
A lot needs to be done, and a lot needs to be done with assistance from the Commonwealth, because we do pull together—except for our tribal rivalries when it comes to sport and other issues—when it comes to the crunch. On matters such as disaster relief we do hang together as Australians. We support one another and this is another measure of what we do in giving realisation to that. It is more than just a concept; it is what we are as Australians.
Only yesterday I spoke rather briefly on the condolence motion about New Zealand. I referred to the significance of the emerging Anzac Day. Anzac Day is a lot of things, but for me it defines us as Australians and New Zealanders. It defines how we act in adversity and how we pull together and act as a committed nation as we support one another. That is what we set out to do in schedules 1 and 2 of this bill. We will provide income subsidies to be paid to the victims of the floods—disaster relief payments to those who demonstrate that they have experienced a significant loss of their personal and direct income as a direct consequence of the flooding that occurred. These things need to be taken into consideration in providing those exemptions and ex gratia tax payments.
The other aspect is small business. You know, Mr Deputy Speaker, coming from Queensland, about the entrepreneurialism of Queensland when it comes to small business. It is something a lot of people aspire to. They do enjoy the freedom of going out there, particularly in the areas of primary industry and tourism and the downstream activities that support those industries. These are things that should not be lost. It is not about waving a magic wand, conducting all the various donation campaigns. I have got to say that it is very humbling to see in each of our electorates the amount of money that was raised. In my electorate alone, which is the most multicultural electorate in the country, well over half a million dollars was raised. I thought it was very interesting to see all these newly-arrived Australians going out to support fellow Australians. It was a very good, decent and humbling thing to see. But we do have significant responsibilities and we do need the means to do that and to encourage people back on their feet. We talk a lot about mining and the importance of the resource economy that underpins Queensland; nevertheless, the driving aspect for employment in our modern economy is small business. We need to see small business people back on their feet as quickly as possible, and it is part of what we are seeking to do through this provision.
The other aspect of the bill that I particularly support is schedule 3, which makes more flexible the provision of the first home owners grant. The money in the first home saver account will be made available to go into a genuine mortgage after the end of a minimum qualifying period, should the account holders purchase a home and the release conditions be satisfied. The government clearly recognises the difficulties that first home buyers face. The money has to be committed into either a superannuation or a retirement fund, none of which is going to find its way into paying a mortgage. I am actually going through this with my son and his partner at the moment—Jonathan and Kylie. They live at home and, as a caring father, I would like to see them stand on their own two feet at some stage. We are encouraging them to think about going out and using the first home saver account and getting themselves into the real estate market. It does not matter where you come from—the inner city or, where we live, the outer metropolitan areas of Western Sydney.
Affordable housing is something that is fast moving away from our psyche. We know that it is important to be able to get in, if you genuinely want to become a first home owner and have a plan for getting there. Gone are the days when—such as when I was buying a house—you could just roll up to the building society, apply and have the loan that afternoon. You do need, for very good reasons, a savings record. We have just come from the world’s worst economic meltdown, and it is largely attributable to the Americans and their subprime market, which was fuelled by people simply going out and being able to access mortgages which they could never in their wildest dreams ever contemplate repaying. We did see a bit of that start up in this country, where people could go out and borrow 110 per cent of their needs in terms of housing, and you got not only the house but the carport, the driveway and the curtains. We went for a good six months, if not more, with sheets hanging over windows and things like that. The point I am trying to make is that we need a strategy to get there, and this is what we are seeking to do with this legislation. We are trying to make the first home owners grant crucial to making the decision to take up your first home. As I indicated, the price of housing is making it harder for most Australians to realise the dream of owning their first house, and you cannot do that simply by willing it to happen. You need to have a firm strategy, and that is what we are seeking to do.
Currently, where a first home is purchased before the minimum release conditions are met, the first home savers account must be closed and that money goes into your superannuation or a retirement savings account. I have got to say, for a 23- or 24-year-old, it probably does not mean all that much to see the money that you have already saved going away until you hit the wily old age of 60. That is a long way down the track—maybe not for some of us now, but I guess when I was 23 or 24 I thought that was an eternity. The new provisions will allow that money to be paid into a genuine mortgage at the end of that minimum qualifying period. The money can actually be put to use to help sustain the very mortgage that people have entered into.
This change will further assist aspiring home owners by allowing them to purchase their home earlier than they might have originally planned and still be able to put the money towards their new home should their circumstances change. These changes will not do anything to harm the underpinning concessions of the first home savers account. The government will continue to contribute 17 per cent of the first $5,500 indexed to an individual’s contribution made during the year. This means that, if an individual is able to make the maximum contribution of $5,500 into their first home savers account, they will be eligible for the government’s contribution of $935. Where individuals come together to form a couple—as is the case with my son Jonathan and his partner, Kylie—they will be able to pool their first home savers accounts to produce those savings together. Earnings in respect of this are taxed at 15 per cent and the withdrawals will be tax free when used to purchase their first home.
These are things to be encouraged. I know some mocking words were used about the take-up rate being something like seven per cent. If you consider the economic circumstances since 2007 and beyond, it is no wonder that there has been a slow-down in the purchase of real estate generally because of the prices involved. We are trying to do something to make it affordable at that entry level. We do not want to do it in such a way that it overheats the entry-level market; we want to do it in such a way that it actually empowers people to buy their first home, gives them a strategy which can actually help them realise their dream and still enables them to purchase their home without having the price artificially propped up by one-off payments of money. This is a better way of doing it. It actually ensures that couples, when they are moving to buy their first home, enter upon a strategy which is designed to help them not only establish the pattern of saving to attain the mortgage in the first place but also, hopefully, help them establish a long-term pattern of saving. We do need to reduce debt and to do that we need to have a proper saving pattern. I think that is something, coming out of the global financial crisis, that we have all learned and should take to heart.
I think what is being applied here will do wonders for a lot of people, particularly those that I represent in the federal seat of Fowler, which is an area that has much disadvantage in it. For instance, the median household income for Fowler is currently at $51,900, which is considerably below the median household income that applies across the nation at around about $62,000.
The housing prices in Liverpool and Fairfield in outer metropolitan Sydney do not compensate for the lower average earnings. The median house price in Fowler at the moment is $432,500 with a mortgage repayment of $1,796 a month. By my rough calculations, that means that you commit almost half your income to paying your mortgage. That makes it pretty strained. What we are trying to do is establish the entry level strategy for people who are keen to buy their first place and we are also hoping that this will send a message about the value of saving to achieve objectives. I commend all pieces of this bill to the House.
I am pleased to speak on the Tax Laws Amendment (2011 Measures No. 1) Bill 2011. I realised when I was preparing for this speech this morning that I have a serious personality flaw: I have had a secret fondness for tax laws amendment bills since I was first elected in 2004. They are generally known in-house as TLABs and we do at least a dozen or so of them every year. Unlike many bills in this House which deal with large policy areas, and if it is an important policy area it will have a bill of its own, TLABs tend to pull a whole range of items together in one bill. They are sometimes quite quirky ones that deal with a whole range of things. They are more about governance than government. They deal with the detail of making things happen and implementation.
This TLAB is quite a small one in that it only deals with three matters, but they are quite different. Schedules 1 and 2 of the bill deal with the detail of the implementation of support the government provided for people who were victims of the recent floods and Cyclone Yasi. They do what perhaps every person in Australia would expect them to do, which is essentially to make those payments exempt from income tax. When I first saw a bill like this it was after the fires in Victoria and it did exactly the same thing. It ensured that payments made to people to help them get through some very bad times and get back on their feet were not later considered as taxable income.
Schedule 1 makes the Newstart-like income subsidies that were paid in the early days to victims of floods and Cyclone Yasi exempt from income tax. The income recovery subsidy provided financial assistance to employees, small business owners and farmers who had experienced a loss of income as a direct consequence of the flooding that commenced on 29 November last year. Those subsidy payments were only claimed between 10 January and 28 February inclusive, so they were well and truly payments made during the worst of times and got people who had lost income through those worst days. As I said, schedule 1 makes sure that those payments are exempt from income tax.
Schedule 2 deals with the clean-up and recovery grants to small businesses and primary producers under the natural disaster relief and recovery arrangements. Payments were made to businesses and primary producers directly affected by the flooding and this schedule makes those payments non-assessable non-exempt income. That is slightly different from schedule 1 because if we did not make these grants exempt those payments would interact with other aspects of tax law. What we would find is that if a taxpayer brought losses forward from a previous year those payments would have to be used to reduce those losses first. This makes sure that payments made to those businesses and primary producers under those circumstances are completely separate from any assessment by the tax office. They are both very good little pieces of detail that needed to be dealt with and they are the kinds of details that are usually incorporated in these TLABs.
Schedule 3 is something that I am very pleased to see. It relates to the First Home Saver Accounts. The First Home Saver Accounts were introduced back in October 2008 in what was a very important announcement at the time. They provided another option for predominantly young people saving for their first home. The First Home Saver Accounts, once set up, brought with them a contribution of 17 per cent from the government on the first $5,500 of individual contributions made each year. That meant that an individual who made a contribution of $5,500—and that is indexed—to the First Home Saver Account was eligible for a contribution of $935.
The scheme was capped; there was a limit of $80,000 on the overall account balance. Once an individual reached that balance, they could not make any more contributions of their own but government contributions and earnings continued to flow into that account. Individuals who were members of a couple were able to pool their first home saver accounts and withdrawals were tax-free when used to purchase their first home.
Last month a young man in my electorate came to see me. He had opened one of these first home saver accounts. He freely admitted that he had not read all of the detail when he went into it and he was surprised to find that, when he wanted to buy a house early, he was not able to use the money from his first home saver account for that. It was not so much that his circumstances had changed; it was that he really did not understand what agreement he had made when he went into it.
It is quite reasonable that there are conditions on these accounts where the taxpayer is contributing 17 per cent to assist you to buy your first home. It is reasonable that you cannot, for example, withdraw that money halfway through and go off on a holiday. It is quite reasonable that the money, particularly the taxpayer contribution, be allowed only for the purpose which was given, which is to buy a home. But, under the current regulations, if a dwelling is purchased before these conditions are met, the home saver account must be closed and the money in the account must be paid to the individual holder’s superannuation or retirement savings account. The money in this young man’s account would have had to have been rolled over into his superannuation, so he would not have been able to use it to help pay off his mortgage. He, of course, started the first home saver account because that was what he wanted to do with his own part of the money.
This amendment to the scheme is really very good. It essentially allows the money in a first home saver account to be paid to a genuine mortgage at the end of the minimum qualified period should the account holder purchase a dwelling in the interim. It means that, if this young man in my electorate buys a house before the minimum period is over, he will at the end of the period be able to transfer his money, the government contribution and whatever earnings there have been on that account to his mortgage. So it is a good outcome for him as a young man and a very good outcome for the government and for taxpayers in general, because we all realise that any time a young person, particularly a person in their 20s or 30s, starts accumulating assets through the purchase of their first home we all benefit because of the increased financial security of families in their later years. So what is good for a young person who is buying a home is eventually good for us all.
I commend the bill to the House. There are three important schedules. Two relate to ensuring that payments given to victims of the floods and Cyclone Yasi are tax-exempt. The third one increases the flexibility for young home buyers who are making use of the first home saver accounts.
I speak in support of the Tax Laws Amendment (2011 Measures No. 1) Bill 2011. It is important that all Queenslanders who have had their lives shattered, their farms damaged and their businesses destroyed have confidence that all Australians are behind them in their rebuilding effort. Queensland makes up just over 20 per cent of Australia’s population and certainly contributes more than 20 per cent to the wealth and income of this country. The federal Labor government is stepping in to rebuild Queensland. These were the largest natural disasters in our history: the floods in South-East Queensland and Cyclone Yasi in North Queensland. Without the cyclone’s impact, it is estimated that the cost of rebuilding South-East Queensland and Queensland generally will be $5.6 billion.
My electorate of Blair covers Ipswich and the Somerset region in South-East Queensland. In it I have the Brisbane River, the Bremer River, the Lockyer Creek, Wivenhoe Dam and Somerset Dam. It has been in many ways flood central in the last few months.
The impact on lives is extraordinary. The floods have devastated local communities in the western part of Ipswich, from Rosewood through to Riverview, up through the Brisbane Valley and into the Kilcoy region. Roads, bridges, ports and community infrastructure have been damaged by floods. Just last week I was up in Mount Stanley, which is way north in the Brisbane Valley, where a dozen or more roads were cut off during the flood crisis. The culverts, which were built about 60 years ago, have been damaged. As you drive across in a four-wheel drive, there is still water crossing those areas. Every time it rains, the water comes across. I was up there to visit and speak to some farmers, along with the former deputy mayor of what was then known as the Esk Shire, Simeon Lord. Simeon is not necessarily a card-carrying member of the Labor Party, I assure you. He has strong views and is well known and well respected in the community. He talked to me and some of the farmers in that area of Mount Stanley about what life was like for them in the flood and how we need to rebuild the roads, the bridges and the essential community infrastructure.
Queenslanders and people across the country have been extraordinarily generous with their time, effort and money. Contributions to the Somerset Regional Council’s flood relief appeal and to the Ipswich mayor’s flood relief appeal have been in the hundreds of thousands of dollars. Indeed, the mayor’s appeal in Ipswich is edging close to $1 million now. And the Premier’s flood relief appeal is in the millions of dollars. But we need billions of dollars to rebuild Queensland. At the time of the flood, Centrelink and the ADF, two great arms of the federal government, came in and gave great assistance. I pay tribute to Centrelink, as I did in a speech last night when the relevant minister—Ms Plibersek, the Minister for Human Services—was here. There was great work done by Centrelink locally. We need to rebuild Queensland. The payments that were made during the time of the flood put money back into the hands of people. I want to note that the councils also have received significant assistance from us. The third-quarter financial assistance grant for Somerset Regional Council was brought forward by this government. That totals $611,237. Ipswich City Council received a $1,127,394 grant—money brought forward to assist them to rebuild. And we put $2 billion into Queensland government coffers to make sure that they can do work to rebuild Queensland.
The flood affected areas in South-East Queensland are truly devastated. My estimation is that around 90 per cent of people who have been flood affected in my electorate are still living away from their homes—in caravans, in tents, in motels or bunking with people. They are not back in their homes. If I drive at night through places like North Booval in Ipswich or some of the country towns in my electorate, there are hardly any lights on, because people are not back in their homes. So any way we can give them assistance to mitigate the circumstances that they find themselves in will be beneficial for them, their families and the local communities.
This legislation exempts from taxation the disaster income recovery subsidy payments made to victims and the funding given to New Zealand residents. This benefits my local community because it puts money back in people’s pockets and they do not have to pay it to the Australian Taxation Office. I did not realise there were so many New Zealanders living in South-East Queensland. There are about 180,000 people from New Zealand living in South-East Queensland. Put that in context. The member for Herbert says it is more people than live in his city. It is more than the number of people who live in Ipswich and more than the number of people who live in Toowoomba. You can see why, when New Zealand play the Wallabies or the Kangaroos at Lang Park, so many New Zealanders turn up to watch them play. We provided help during the flood in terms of our disaster relief recovery payments to them. This legislation makes sure that we do not take money out of their pockets.
I think our proposal with respect to the response in South-East Queensland in particular—the way we have structured the raising of the money, investment of the money, the application and the rebuilding—is the right thing to do. We found savings of $2 for every $1 we raised for the levy, so it was the right way to go about responding to an unprecedented natural disaster.
Faced with such a big challenge, it is extraordinarily important to provide help, and I think one of the biggest helps we can provide is the granting of up to $25,000 and offering of low-interest loans of up to $250,000 to small businesses. The assistance we are providing to local NGOs we are doing in consultation with the states. The states are rolling it out through the departments of communities, particularly the Queensland Department of Communities. I know a number of sporting organisations in my electorate have received that assistance. Everything from the dog obedience club in Ipswich through the Ipswich Basketball Association have received assistance through money from the Department of Communities in Queensland—money that is given by us, as well, through our levy and what we are doing to assist the Queensland government. This is important legislation. It is important for local areas as well.
I must say that those opposite have adopted what I think is a simply bewildering response with respect to the flood crisis in South-East Queensland. At a time when Australians stick together and expect bipartisanship to prevail, I am flabbergasted by the response of those opposite to the flood ravaged regions of South-East Queensland. I say this genuinely and personally. I could not believe that they would do that. They have so many members from the area: the member for Ryan, the member for Longman, the member for Maranoa. They have members from all throughout Queensland and Brisbane as well representing the LNP, and yet they opposed what we were doing with the flood levy. It was hysteria. It really was a slap in the face for South-East Queensland and Queenslanders generally. You did not need a poll to know that Queenslanders wanted other Queenslanders and the federal government to give them a helping hand and stick together in this matter.
I was shocked at the response of the coalition. Their lack of preparedness was shown by the response of the Leader of the Opposition when he tried to find savings. His idea was to cut back the NBN funding, and that was the very organisation that people were crying out for in places like Toowoomba, Ipswich, the Lockyer, the Scenic Rim and the Somerset regions. They are crying out for the NBN, and his idea was to delay and cut it back. His idea was to shave money off the BER funding that provided the very multipurpose halls which were used as evacuation and recovery centres in the flood crisis in places like Fernvale and Esk. It was a bewildering and flabbergasting response from those opposite.
I think the legislation here is important. It exempts the funding in relation to the DIRS. To put it in context, the information I have in relation to this is that, to date, Centrelink has processed over 664,000 claims for the Australian government disaster recovery payment in Queensland for floods, paying almost $715.1 million. It is an enormous amount of money. It has processed just under 72,000 DIRS claims in Queensland for floods, totalling over $54.9 million. That is why these payments are important. It is a huge amount of money going into the hands of individuals. In Ipswich about 3,000 homes were inundated. In the Somerset we are talking about 600 homes inundated—or pretty close to it. They are people who receive money whether they are New Zealanders or Australians. They receive money to help them because so many people lost everything. They lost their furniture, they lost their clothes, they lost their possessions, they lost their mementos—the things that they found important.
That money—the $1,000 per adult, the $400 per child and the $170 per person given by the Queensland Department of Communities—was absolutely vital not just to stimulate the economy but to give people some hope, some chance in life to rebuild. I am on the record as being critical of the means testing that the Queensland government has done in relation to this. I have been pushing the envelope on this issue, trying to advocate for my community in terms of our response on this issue. In fact I have been critical of all levels of government, but I do honour and thank all those levels of government—Centrelink, Ipswich City Council workers, the ADF, Somerset Regional Council workers and the Queensland Department of Communities. We have had a fantastic community response, a coordinated effort, to try to rebuild South-East Queensland, particularly in my electorate of Blair.
I am convinced that this government is on the right track towards recovery for South-East Queensland. I cannot say the same for those opposite, particularly when the Leader of the Opposition started listing off the flood affected electorates in Queensland and actually listed your electorate of Petrie, Madam Deputy Speaker D’Ath, where there was not any flooding. He could not even work out the electorates which had been flooded. That is the extent of the concern and consideration the Leader of the Opposition has for the people of Queensland—he did not even know which areas were flooded and what electorates people were harmed in. He did not understand the flood geography of Queensland, and he did not even understand the electoral demography of Queensland. That is the extent to which the Leader of the Opposition has concern for helping the people of South-East Queensland rebuild their lives.
This is good legislation; it will help my community and I warmly support it. I commend the government for being on the right track with flood recovery in South-East Queensland.
I thank all of those members who contributed to the debate on the Tax Laws Amendment (2011 Measures No. 1) Bill. In particular I acknowledge the contribution of the member for Blair, who was a very strong and effective advocate for the people of his community. I think that came through very clearly in his contribution today.
Schedule 1 introduces taxation measures to alleviate the financial hardship being felt in communities affected by the disasters that have devastated Australia over the 2010-11 summer. These amendments exempt from income tax the disaster income recovery subsidy payments to victims of the recent floods and Cyclone Yasi and the ex-gratia payments made to certain New Zealand visa holders affected by a disaster where the Australian Government Disaster Recovery Payment has been activated. Exempting these payments from income tax maximises the amount of payment that individuals receive and is consistent with the exemption provided for equivalent payments made in response to other disasters, such as the devastating Black Saturday Victorian bushfires.
Schedule 2 exempts from income tax category C payments made to flood affected small businesses and primary producers under the Natural Disaster Relief and Recovery Arrangements. This measure recognises the hardship suffered by small businesses and primary producers in affected areas and provides certainty for recipients in terms of tax treatment at a time when they should not need to worry about tax matters
Schedule 3 amends the tax laws to allow the money in a first home saver account to be paid to a genuine mortgage after the end of a minimum qualifying period should the account holder purchase a dwelling in the interim. This increases the flexibility of first home saver accounts by allowing individuals to purchase a home earlier than planned and still be able to put the money towards their new home.
Currently, if a first home is purchased before certain minimum release conditions are met, the first home saver account must be closed and the money in the account must be paid to the individual account holder’s superannuation or retirement savings account. First home saver accounts are designed to encourage individuals, through tax concessions and government contributions, to save for their first home over the medium to long term, and have been available since October 2008.
The government has consulted on these changes and the measure applies for houses purchased after royal assent. This bill deserves the support of the parliament. I commend this Bill to the House.
Question agreed to.
Bill read a second time.
Ordered that this bill be reported to the House without amendment.
Debate resumed from 10 February, on motion by Mr Snowdon:
That this bill be now read a second time.
I rise to lend some comment on the Military Rehabilitation and Compensation Amendment (MRCA Supplement) Bill 2011, and in doing so I acknowledge across the chamber the Parliamentary Secretary for Agriculture, Fisheries and Forestry, the Hon. Mike Kelly, a veteran of Somalia and a man of great military experience—someone who you would expect, with a government that likes to flaunt its credentials in defence, the military and, indeed, national security, would be at the forefront of all that the government would do in this. He started his parliamentary life, of course, as the Parliamentary Secretary to the Minister for Defence but then, in the government’s great wisdom in hindsight, it moved him to Forestry, Fisheries and Agriculture. That speaks volumes about how much this government cares about veterans, defence and national security. It is important that we look not at what a government says but at what a government does. When it takes its finest mind on defence and puts it with trees and fish, it sends a very clear message that that is how this government views defence.
This bill will bear testimony—be under no doubt—to the wanton indifference this government has to defence issues. The MRCA supplement bill seeks to make only minor amendments to the Military Rehabilitation and Compensation Act 2004. Indeed, it simply seeks to clarify entitlements with regard to certain allowances and supplements in order to ensure eligible widows and widowers are not overpaid. It is ostensibly a housekeeping bill. I agree with the government that the housekeeping amendments are appropriate. However, they are only appropriate and only necessary because the Labor government failed to conduct its appropriate due diligence when introducing the changes to the way that these certain pensions were paid. This bill is once more symptomatic of Labor’s piecemeal approach to managing the Veterans’ Affairs portfolio and caring for Australian veterans and defence.
Not only do you look at the way they act in moving the Parliamentary Secretary for Defence—a highly capable and professional military officer and politician—into trees and fishes; you simply need to look at the wide variety of mistakes in legislation that continues to bear testimony to this. So let us look at the background of this to understand how Labor got to this farcical position of having to legislate to fix up one more of its errors. On 20 September 2009, the Labor government changed the way certain pensions were paid under the pension reform package. The MRCA supplement became payable from 20 September 2009 and replaced the telephone and pharmaceutical allowances that were payable prior to that date. Under the MRC Act, compensation pension payments to eligible veterans and their dependants are paid weekly. However, under the Veterans’ Entitlements Act 1986 and the Social Security Act 2001, payments are paid fortnightly.
Furthermore, under the MRC Act a weekly payment can be converted to a lump sum. Prior to 20 September 2009, where a lump sum was selected, the wholly dependent partner continued to receive the fortnightly pharmaceutical allowance. However, after 20 September, the pharmaceutical allowance became part of the weekly war widow pension and is therefore included in the calculation of the total lump sum payment. Stay with me; I know it is difficult for the Labor Party to comprehend where this is going. The result of these changes and these moves and the result of these legislative amendments that the government put in, and the reason for the introduction of this very bill, is that some widows who may have already received a lump sum, including the equivalent pharmaceutical allowance, may also be receiving the MRCA supplement. This could lead to a so-called double-dip of entitlements. Notwithstanding provisions which already exist in the legislation to prevent multiple entitlements from occurring, this bill seeks to clarify arrangements relating to the MRCA supplement and lump sum payments after 20 September 2009. The Labor Party is simply fixing up the mess that it legislated itself into.
Clearly, we support the bill. We support standing up for veterans and our defence community. We support Labor fixing up their own abhorrent mistakes. The end result is more important for the nation, and it is good that Labor comes forward and says mea culpa, indeed mea maxima culpa—‘I have really stuffed up’.
But this is not about just the area of this particular bill. The issue of wanton disregard for veterans goes wider but is symptomatic and links through to this bill. Indeed, the coalition and the veteran and ex-service community remain very sceptical of the Gillard Labor government’s agenda when it comes to managing the full gamut of what is a complex Veterans’ Affairs portfolio. It continues to be piecemeal in its detail, especially when unfortunately the government has dictated that only one quarter of the time of the minister—Minister Snowdon, who I have some high regard for; I think he is a very decent man—can be spent on the incredibly complex portfolio of Veterans’ Affairs.
The Howard government had a full-time veterans’ affairs minister. That is the regard in which we held the veterans in our community—a full-time minister. Again, as we started we said, ‘Don’t look at what the Labor government says. Look at what they do.’ They have taken a highly competent former officer and parliamentarian in Mike Kelly and put him in charge of fishes and trees. We have Minister Snowdon, who is the Minister for Veterans’ Affairs, the Minister for Defence Science and Personnel—another highly complex area—the Minister for Indigenous Health—yet another highly complex area—and now the Minister Assisting the Prime Minister on the Centenary of Anzac. I do not care how good a minister you are; you cannot deal with four challenging areas especially Indigenous Health, Defence Science and Personnel, and Veterans’ Affairs. I do not care if Minister Snowdon is Superman. He is clearly and utterly unable, as anyone would be, to manage such portfolios in diverse and complex areas. But that is the degree of contempt and disdain that this government has for veterans and the defence community. Do not listen to what the government says. Watch what the government does.
Because you have a minister so overtaxed and across so many different areas, he is just not able to be across the detail. It is not his fault. This is what the Labor government dealt him. That is why we are seeing this bill today fixing a mistake from a previous bill yesterday. Perhaps that explains how the Labor government dropped the ball on the funding for the Australian War Memorial. Again, that is symptomatic of the ball being dropped by an overworked minister. This government had to be dragged kicking and screaming into providing the bare minimum of funding to ensure services at the War Memorial were maintained. It was an 11th-hour rescue package; it was at the 11th minute of the 11th hour. The Gillard Labor government denied there was even a problem and dismissed the growing calls from the Council of the Australian War Memorial. In fact, letters between the Council of the Australian War Memorial and the former Minister for Veterans’ Affairs, Alan Griffin, belled the cat on the memorial’s financial crisis more than 11 months ago.
The government were dragged kicking and screaming to provide the funding. They did not even come close to matching the coalition’s $25 million commitment for the refurbishment of the World War I galleries. Credit should ago to my colleague the honourable senator Michael Ronaldson for fighting so hard to ensure that the War Memorial, an institution of national and historical significance, remains properly funded.
This bill, as once again it is incredibly disappointing to say, is just another in a series of ad-hoc, on-the-run policy revisions carried out by a government that moves its competent ministers out, overtaxes its current ministers and ensures that these mistakes continue to occur. I accept the provisions of the bill. I think we all agree that they are appropriate to ensure that people do not find themselves inadvertently double-dipping, especially widows finding themselves in the dreadful position where perhaps not of their own making or doing they are forced to repay funds back to the Commonwealth—as if the horror of losing their partner were not enough. I accept that these are appropriate to ensure that does not happen. But this bill is only necessary because this was not done properly in the first place. It is a failure of the duty of a minister to ensure they know what they are doing.
I find it fascinating to look at what Minister Snowdon said in his second reading speech on this bill. Poor minister, so overworked and I am sure he did not write his own speech: if he had he would not have said this:
The bill demonstrates the government’s commitment to continually review, update and refine our operations to provide the optimum level of services and support to our current and former military personnel and their dependants.
May I say gently that I take enormous offence at the statement from the minister. Last week—only seven days ago—the government released the Review of military compensation arrangements report. Was it a week late? Was it a month late? It was 12 months late. How the minister can stand in the House and say that they are refining their operations to provide ‘the optimum level of services’ when they provide responses 12 months late is beyond me. I encourage the government to do this: try that optimum level of service out there in the community. Say to Centrelink, ‘Don’t bother responding to your constituents for 12 months’, because clearly that is an optimum level of service. Say to the department of health: ‘Don’t bother getting back to people requesting a district of workforce shortage determination for 12 months’, because that is an optimum level of service. I would say this to the parliamentary secretary when your constituents want you to look at forestry, fisheries and other areas: ‘Don’t reply to them, Sir. You’ve got 12 months.’ That is because your senior minister says that is an optimum level of service. I think this government has hit an all-time low in defining what service levels are. It is not surprising given that 90 per cent of their frontbench is from the unions with no experience in business. They would know if they had business experience what an optimum level of service was.
Secondly, the government is yet to release its response to the Podger review report, also known as the Report of the review into military superannuation arrangements. The Labor government has had this review, which deals with all veterans’ issues, especially as to superannuation, for three years. So three years and still no response on the Podger review, but clearly, as Minister Snowdon says, they are reviewing, updating and refining their operations to provide an optimum level of service!
Thirdly, how can the minister possibly argue that he, along with the Gillard Labor government, is acting to provide optimum support for former military personnel and their dependants when they are actively trying to block right now, at this very second in the other place, the coalition’s Defence Force Retirement and Death Benefits Amendment (Fair Indexation) Bill 2010? The reality is the coalition is the only party in the parliament who have a full range of full-time shadow ministers committed to ensuring an optimum level of service for our veteran community and our defence force. We are the only party that is properly engaged with military superannuation when it comes to indexation. We are the only party who want to see reviews paid for at taxpayer expense to be properly released in appropriate time frames to allow ex-service organisations and the community to respond to them. If this Labor government were serious about reform and about caring for veterans and their dependants—which they claim—and if this government were demonstrating their commitment—in the minister’s own words to ‘continually review, update and refine our operations to provide an optimum level of service and support to our current and former personnel’—then I would implore them to support the coalition’s bill in the Senate right now. I have come straight from the Senate to here, where the minister for finance is railing against our bill whilst the Minister for Veterans’ Affairs has been standing there saying that they are providing an optimum level of service and support to our veterans. There is a huge disconnect between both houses of parliament.
I remind the government that before the 2007 election, and leading into the 2010 election, they said they were committed to fair indexation of pensions and committed to supporting our veterans. I say to them now: where the rubber hits the road, when there is a bill in the Senate right now being debated this second, let us see where your level of commitment is to provide an optimum level of service and support to veterans. I hold a degree of respect for the parliamentary secretary, Mike Kelly. I know he wrote to the minister for finance imploring him to stand up and accept what they did in 2007 and index the military pensions. I know he wrote, and that is a testament to the man on the other side of the chamber. But the government did not listen to its own expert on defence and veterans’ issues. The one person who actually knows what the hell is going in Defence was not listened to. And that is to the enduring shame of the Labor Party.
In wrapping up, may I say we support the housekeeping bill. We do not want to see widows or widowers inadvertently left out in the cold, faced with a bill from the Commonwealth. That is not how we want to see those who have given so much for our nation. We support Labor fixing its stuff-ups. It is not controversial, but it does demonstrate—it does show without a shadow of a doubt; it does put clearly on the table for all to see—that this government is not across the Veterans portfolio, it is not across the Defence portfolio and it is not committed to those who served and who serve our nation. If it were, it would have full-time ministers. If it were, it would look at the expertise on its front bench and it would use that expertise where it is best able to be used. If it were, it would back up and fulfil the promises it made to the Australian people. I implore the government to get its house in order on veterans and defence issues or, I guarantee, the nation will make sure its house is put in order.
I thank the honourable member for Fadden for his contribution. I feel like I should be tithing my wage to him for the wonderful comments that he made during his speech. I want to acknowledge here that the member for Fadden is genuinely concerned about our defence members and our veterans. I have absolutely no doubt about that. We had very genuine collaboration on many issues concerning veterans matters, particularly when I had responsibility for the honours and awards aspect of the Defence portfolio. But I have also noticed that the member, in his time in parliament, has acquired some very impressive acting skills. If we want to deal with the entire spectrum of the issue of veterans affairs and defence matters, we will see that they do not all begin in 2007; they have quite a long history that goes back during the 12 years of the Howard government. I could throw out a few one-liners that would encapsulate many of those issues—things like ‘Seasprite’, ‘LCMs’, ‘Manoora and Kanimbla’ et cetera. I could go on and on, and a calculation could be applied there that would stretch to the billions of dollars.
I could also talk about the superannuation issue and the fact that there were 12 years during which the Howard government might have thought they could deal with that issue. I do not know where they were on that front; ‘missing in action’ might be the description we could apply. Nothing happened. If resolving this superannuation question were such a big issue—and certainly there are matters to be discussed there—why did nothing happen for 12 years? The bill that the member refers to is, I think, quite despicable and I do not support it. It is a divide and rule measure which does not also deal with the issue of civilian superannuated pensioners. But it is very hard to take the opposition seriously when they had the opportunity to do some of the things they have been talking about and did not do them.
But I am very proud of the measures that have been taken by this government in relation to veterans entitlements. It is a spectacular record. The Military Rehabilitation and Compensation Amendment (MRCA Supplement) Bill 2011 is a housekeeping bill, as the member has quite correctly pointed out. You will need to do housekeeping from time to time if you are a reformist government that takes on the big issues. Of course, you do not need to do housekeeping if you do not ever do anything—if you do not actually take on reform. These things are easier to do if you just sit back and say, ‘I’m not going to fix this; I’m not going to fix that.’ The legislative liability then becomes quite small. You can have quite an easy life, which is what we saw during the Howard years, the Rip Van Winkle years when nothing was done. This is a reformist government. This is a government that is determined and prepared to take on the big challenges, and the challenges of veterans affairs are some of the largest. There are so many things that need to be cleared up in this space.
The Military Rehabilitation and Compensation Amendment (MRCA Supplement) Bill 2011 deals with a situation that arose in relation to an election that wholly dependent partners of deceased members could make in relation to lump sum payments or weekly payments. In the six-month period when they were able to make that election there were anomalies that were evident in our overall pension reform package in relation to the pharmaceutical allowance. This legislation will clarify that position. There is also an aspect that needed to be cleared up and tidied up in relation to double dipping, which is perhaps the shorthand way of expressing that. This legislation clears up the conflicting aspects of the application of the Social Security Act, the Veterans’ Entitlements Act and the MRCA.
I feel that we should respond to the challenges that have been thrown out there by the honourable member for Fadden in his advocacy, which I applaud. Let us get the facts straight. Let us run through some of the things this government has done for veterans. Let us start with the fair indexation for all veterans compensation pensions from 20 March 2008, where we indexed those pensions to both CPI and MTAWE. The PBLCI, the pensioner and beneficiary living cost index, has also been employed to make sure that we have an accurate reflection of the actual cost of living for these recipients. This was a significant reform measure. There was also an increase in the extreme disablement adjustment pension of $15 per fortnight from 20 March 2008 and an increase in non-economic loss compensation payments from 2008.
The general rate table to assess payment amounts has been increased by five per cent. We have improved the indexation of the war widows domestic allowance so that from 20 March 2008 that allowance has been increased by $10 per fortnight. We have provided $50 million for national transport concessions so that seniors card holders who use public transport services outside their home state can have that access and facility, as applied in their states and territories, right across the nation—a very significant measure. We provided extra financial support through our Making Ends Meet initiative. The utilities allowance for eligible pensioners was increased to $500 per annum paid in quarterly instalments. The seniors concession allowance was also increased and the telephone allowance raised.
Secure and sustainable pension reforms have benefited over 320,000 of our service pensioners and war widows to the tune of more than $1.1 billion announced in the 2009-10 budget. Those new payments commenced on 20 September 2009 so that single service pensioners and war widows now receive up to $32.49 extra per week and service pensioners on the couples rate receive up to $10.14 extra per week combined. Those on disability pensions who qualify for the service pension, age pension or disability support pension, including over 80 per cent of the totally and permanently incapacitated pensioners, receive the increase in line with their financial circumstances.
We have increased funding for the Applied Suicide Intervention Skills Training program by an additional $1 million. A comprehensive Australian Defence Force Mental Health Lifecycle Package has been introduced. We have improved mental health support by implementing the two studies into this issue that were instituted by this government, and $92 million has been allocated for the implementation of both reports. Key initiatives such as case coordinators in DVA are now in place supporting clients with complex needs, and other recommendations are still being implemented.
We have got extended repeat prescriptions for the chronically ill so that 290,000 veterans and war widows with chronic health conditions can now get up to a 12-month supply on a single prescription for some medication, reducing the number of times they need to see a doctor just to obtain prescriptions. We have included young ex-service people with disabilities in the Commonwealth State and Territory Disability Agreement. That commenced on 1 January 2009 and includes a commitment to ensure that these younger veterans have access to specialist disability services where DVA programs are not available to provide the care and support they need and require.
We have improved community care and support for those with chronic and complex conditions. We are beginning a new, $152.7 million initiative to increase community based support for those with chronic conditions and complex care needs who are at risk of unnecessary hospitalisation. The program includes $28 million to expand the Veterans’ Home Care program by introducing a new service to target older, frailer veterans, who are most at risk. An estimated 17,000 veterans and war widows will benefit from that initiative alone. We are providing zero-real-interest loans for aged-care facilities. We have been delivering that initiative since 17 September 2008, supporting the development and expansion of aged care services. We intend to extend this initiative, providing a further $300 million in loans to support the development of up to 2,500 aged care places.
We have extended support for the families of veterans. We have extended the income support supplement to widows without dependents. This commenced in July 2008 and involved the abolition of the age restriction on the payment. We had the Vietnam veterans family study. We extended bereavement payments for single TPI and EDA veterans who die without sufficient assets to pay for a funeral. That enabled those families dealing with the loss of their loved ones without sufficient assets to pay for a funeral to get support, and that commenced on 1 July 2008. We had the automatic granting of war widow’s pension to widows of TTI—temporarily totally incapacitated—and intermediate rate pensioners. The automatic granting of that commenced on 1 July 2008.
We have empowered the ex-service community. We have increased the financial assistance for ex-service organisations with an additional $5 million. Total funding of $14.9 million will be made available over four years. There is a new consultation framework with the Prime Minister’s advisory council for these ex-service organisations, because even though we have done so much there will always be more to do and issues that need to be addressed. We now have a permanent mechanism by which we can stay engaged with that stakeholder community to deliver the outcomes that are necessary. The council has met eight times now, and we have looked at a range of issues, including the Clarke review and the F-111 deseal-reseal issue, which was in a bit of a mess prior to this government coming on board. Other bodies have been established, including the ESO roundtable and a series of issues-based committees to advise both the Repatriation Commission and the government.
We have improved the operation of the Department of Veterans’ Affairs by establishing an interdepartmental working group to help deal with multiple agencies. We have formed a special claims unit that has cut processing times. We have revisited the recommendations of the Clarke review. We have implemented the issues that were not being dealt with and addressed issues such as the changes in access to pensions and health care under the Veterans’ Entitlements Act for former ADF British nuclear test participants using more generous and reasonable hypothesis-based standards of proof, and other measures including the reclassifying of the service of personnel on certain submarine special operations from peacetime to qualifying service. A number of other recommendations were referred to the review of military compensation arrangements that is expected to report by the end of the year.
We have established a DVA hotline to assist ex-service officials. We have maintained a separate and properly funded Department of Veterans’ Affairs. I am very proud of the things that we have done to clear up decades worth of issues in lack of recognition and problems that are outstanding in the honours and awards fields. That was a particularly pleasing aspect of what we have done. These things went back as far as the Second World War and included the small ships issue and the 2nd D&E Platoon recognition. There were also the Long Tan issues that were left in such a mess by the previous government; the recognition of escapees among prisoners of war; the Battle for Australia Day and Merchant Navy Day issues; and the implementation of the Post-Armistice Korean Service Review recommendations, which I know was so well and eagerly received by the wonderful Korean service veterans, who were long overdue to have that matter resolved. There was also the declaration of the Ballarat prisoner of war memorial as a national memorial. I am particularly proud of this, as my own grandfather has his name on that memorial as having survived the Burma-Thailand Railway experience. It is so important that we do honour and recognise the incredible experience that so many members of our Defence Force endured with great suffering. There is $10 million for an interpretive trail on the Western Front. There is the establishment of the Defence Honours and Awards Tribunal, which took such a lot of effort and did receive bipartisan support, for which I thank the member for Fadden.
The Gillard government is now engaged in many other initiatives which will be put into place. Through the Department of Veterans’ Affairs in 2010-11 we have seen funding of $12.1 billion, including the $6.9 billion for compensation and income support and $5.2 billion for health and health services. That is $1.3 billion more than was provided in the last coalition budget, and it is being provided over a period when DVA’s client numbers have decreased from around 440,000 to fewer than 380,000.
There are many other issues that would take me too long to go through, but they include issues to do with the Military Health Outcomes Program; reviewing aged-care needs of veterans; making community mental health more ex-service friendly; pharmaceutical reimbursement schemes; dealing with the longstanding mess that was left to us by the previous government on military superannuation and the Podger review; review of DVA funded ESO advocacy and welfare services; legacy of war-wounded personnel; et cetera et cetera.
I am particularly pleased with the $83 million that has been committed to implement improvements in mental health. We are pursuing new rehabilitation policies. We are very determined to make sure that our veterans receive the support that they deserve. Of course, there are many other issues that relate to how our service personnel deal with their day-to-day commitments in the Defence Force which are not well understood by the general community, and the risks and sacrifices they make. I take my hat off to them and I take this opportunity to salute them.
I also take this opportunity to thank two of my staff who did so much hard and excellent work in resolving many of these outstanding issues on honours and awards in particular. They are Mr Mark Sjolander of my office and Ms Elyse Gatt, known to us as Elsie. They did great work in liaising with these wonderful veterans and I am so pleased to see the outcomes that they have helped to deliver and the peace of mind and satisfaction that we have seen on those veterans’ faces. I commend this bill to the House.
It is good to be speaking after the Parliamentary Secretary for Agriculture, Fisheries and Forestry, who made that fine contribution on this matter. He is a sad loss to the defence establishment portfolio. I think his obvious and evident interest and skill in this field are going to be particularly missed by a government light-on for people with experience in and knowledge of defence and veterans’ affairs.
The Military Rehabilitation and Compensation Amendment (MRCA Supplement) Bill 2011 is to correct an error in the previous legislation which produced an unintended consequence. On the surface of it, it can be quite common in governance in any jurisdiction that legislation is introduced which has unintended consequences, things that were not foreseen in the design of the legislation. In this one, as we know, it is a very serious matter in relation to widows. The unintended consequence arising from the amendments was that, where a member or a former member of the Defence Force died prior to 20 September 2009, if the decision of a wholly dependent partner to receive a lump sum was made after that date, the calculation of the lump sum payable was based on the law as it was at the date of death, meaning that in certain cases widows would have to repay large amounts from the lump sum. This was a completely unintended and undesirable outcome and I am sure that has the unanimous agreement of this House.
What this matter does show is an approach to government that is becoming the norm from this Labor government. They say on their own website—and I do not go to the Labor Party’s website regularly, but I did so in relation to an article I was researching on defence and veterans’ affairs—that, ‘Defence must be the first and highest priority of our national government.’ That is what it says in the Labor Party’s policy platform. Yet when you look at their defence portfolio and what is happening in veterans’ affairs and defence and the bill before us you do not get the sense that it is the first priority of the national government.
As someone with a military reserve background I want to endorse the notion that the first priority of our national government—the reason we have a national government in the first instance—is to protect this country, its citizens and its interests from foreign invaders and to protect our country’s economic and military interests overseas and our regional interests. That is our first priority as a government in Canberra and it must be our first priority. If something is your first priority, I think it deserves much more attention than it gets from this government. This bill is a good example of why that is so. We are going back and fixing up things that should have been fixed a long time ago because when they are not fixed they produce consequences that are undesirable for widows and for veterans in general.
We have seen a change in this government’s veterans affairs’ ministry and, I think, that is partly why we see legislation such as this. In 2007, the Rudd government’s Minister for Veterans’ Affairs, the Hon. Alan Griffin, came with a lot of promises for the veteran community. He had spent a lot of time arguing and lobbying on veterans affairs prior to the election, promising a lot and suggesting there would be a big improvement in the quality of veterans affairs outcomes in Australia on the election of the Rudd government. The Parliamentary Secretary for Agriculture, Fisheries and Forestry—who, sadly, is no longer involved in the defence portfolio at all—listed quite a few good things that have been achieved. I thought it was a little bit dry and missing some obvious things. But one of the big things that the veterans community will tell you that they had promised to them by former Minister Griffin, and about which they had an understanding with this Labor government, was the issue of military superannuation.
When considering these sorts of veterans affairs bills that come before us, there is one bill that the veterans community wants to see pass through this House in the near future and that is the coalition’s bill to improve the indexation of the DFRDB and the DFRB superannuation pensions, the Defence Force Retirement and Death Benefits Amendment (Fair Indexation) Bill 2010. I want to get on the record my endorsement of the bill of the member for Fadden, the shadow minister for Defence Science, Technology and Personnel. Today marks a great step forward for veterans in Australia. We owe our veteran community so much. They have given this country so much service. We must not just think about how to improve the quality of outcomes to the veterans community from so many years ago; we have a job and a duty of care to think ahead for all these young diggers we have sent to Iraq, Afghanistan and into operations in our theatres in recent years who will be veterans and will have the same sets of veterans issues, albeit in different circumstances, that have arisen today.
When a veteran comes to my office, as they do regularly, and says to me they have to struggle to get an outcome from the Department of Veterans’ Affairs, when they are clearly a veteran, when they clearly have an entitlement to something from the government in relation to their personal matter, I get very frustrated, as do so many members of this House. Why do we burden our veterans community with so much red tape, when we ask them to put so much on the line? It is true that there have been some improvements in the operation of veterans affairs matters. But there need to be more improvements. It is not inspiring that we have to go back and correct legislation because we have not thought about it properly in the first place.
If the Labor Party and the government were serious, the indexation of military superannuation would be their highest priority in relation to the veteran community. It is probably the No. 1 issue that is being spoken about out there at the moment today, other than individuals’ personal matters of concern with DVA.
The government have released the review of military compensation arrangements, which was released on 18 March. Again, when you consider the contention in the policy statement that ‘defence must be our highest priority,’ this review of military compensation arrangements is some 12 months late. Nevertheless, it is a significant review and of course the coalition has committed to extensive consultation on the review’s findings. But considering that this is a year overdue, you get the sense, yet again, that this vital part of our community is not being given the priority or the attention that it deserves.
We will extensively liaise with the ex-service community, the veteran community. I am conducting my consultations, particularly with the Castle Hill RSL, about the review of military compensation. We look forward to progress that does not take another year. Often, we think of a year in governmental terms as another review or another period of time to fix things and that it is acceptable. I think in relation to the circumstances of ordinary people’s lives, particularly veterans who are already suffering from individual problems and matters of concern in relation to compensation, that this is an extensive period of time. These people are getting older. Their compensation is a serious matter to them. There needs to be a greater sense of urgency in relation to our treatment of these vital people and this vital community.
I also endorse the purpose of this bill, which I have spoken about briefly in correcting an error. The member for Fadden made some very good points about our commitment to supporting the government on key initiatives. The Parliamentary Secretary for Agriculture, Fisheries and Forestry spoke about the government’s achievements in resolving issues to do with honours and about correcting some of the things that had been of concern for some time. They had the full support of the coalition. I note that, in opposition, we have not taken a partisan or destructive approach in relation to veterans’ affairs. We are more urging the government to get on with the things they need to get on with.
When you look at the military superannuation reform, the coalition’s bill which is presently before the Senate—I think it was being discussed today by the shadow minister for defence—says to the government, ‘Here is a way out. We are providing you with the bill. You have promised it, we have talked about it and the veterans’ community desperately want it. Here is an opportunity for you to just get on board and deliver this vital reform.’ The parliamentary secretary spoke about a reforming government and that this bill was an example of why they are such a reforming government. When they do reform they say, ‘We have to keep doing these amendments and updating bills because we are so reforming’. If we are so reforming, let us do some real reform that will vastly impact on the lives of all those people out there on the DFRDB schemes. This change has been called for by the ex-service community. It has had their full support for so long.
While this bill is not controversial, and it has the coalition’s support—especially in clarifying the arrangements under the Military Rehabilitation and Compensation Act 2004—we do urge the government to ensure that treatment of Defence personnel, and particularly the treatment of veterans—our ex-service personnel and community, not just of the past but of the future—is done in the best way possible. When we have people of the quality of the member for Fadden in our portfolios we are really saying to the government that we have people of real experience and substance in the Defence and veterans’ fields, people who understand the urgency and the need for reform and better approaches from government to the treatment of this vital community. I urge the government to ensure that they make Defence and veterans’ affairs the first priority of the national government.
I rise to speak on behalf of all servicemen and women in the electorate of Dawson, people who make a proud commitment to this country, and who deserve careful consideration of their needs and welfare.
The electorate of Dawson has a large number of military and ex-military personnel, taking in suburbs such as Annandale, Wulguru and Townsville quite near to where Lavarack Barracks and the 1RAR are a dominant part of the local community and the local economy. Regional Queensland has always maintained a strong connection with their ex-servicemen and women, and Dawson is no different from that. Regional towns in Dawson are small enough that residents regularly pass by war memorials on a daily basis.
In fact, many of the small communities have planted mango or fig trees to line avenues in honour of the local men who served and made the ultimate sacrifice in the wars that defined our country. The Eimeo or Pleystowe communities have those trees, for instance. They planted a tree for each of those brave men who volunteered their lives. Those tree-lined avenues are still sacred ground for today’s community because the community respects the commitment that those servicemen and women made.
In return for their commitment though, we as a nation must make certain commitments of our own. The federal government supports veterans and war widows in a number of ways, but sometimes that delivery is not perfect. The delivery of allowances to war widows was not perfect, and there were some unintended consequences which needed to be addressed. In clarifying the legislation, the amendment bill that we speak on today is welcomed by the Liberal-National coalition.
The bill may still not be perfect, but at least it moves a step closer. I understand that these amendments will avoid a situation where a war widow is inadvertently receiving benefits that she perhaps is not entitled to. We must also accept that imperfect delivery may work the other way as well, and sometimes the consequences of an imperfect delivery are far more damaging. The human face of failed delivery in the Dawson electorate in this regard is Mr Fred Collett. Mr Collett is an ex-serviceman who fought for his country and endured hardship for his country. He followed orders, risked his life and survived through one of the worst wars this planet has ever seen—World War II.
Mr Collett is 101 years old, and has been bypassed in the delivery of a commitment made to our servicemen and women. Fred Collett has been penalised for doing his job—penalised for following orders. He had the audacity as a prisoner of war in Greece to escape in a wooden boat and make his way over the sea for three weeks to warn fellow soldiers of an enemy advance. Almost 70 years after that escape, the problem for Mr Collett is that he escaped. When the government paid $25,000 in compensation to POWs, Fred did not qualify. He did not qualify because he escaped.
Since the introduction of the compensation, around 2,500 POWs have received the benefit but almost 800 more have failed to qualify. They were given hope when Mr Collett’s case went before the Federal Court. Unfortunately, he was again denied that compensation last year, even though the Federal Court Justice John Logan ruled that Mr Collett had indeed been a POW. Justice Logan said in his finding that Mr Collett was a POW from the moment his unit surrendered but spending two hours in the surrender area did not constitute residence. He said efforts to escape and rejoin the unit proved Mr Collett ‘conspicuously and commendably did his duty’.
Fred Collett may be 101, but he knows when he is copping the rough end of the pineapple. He is no longer up to taking the legal battle any further, but he should not have to. When I spoke with him yesterday he was still dirty on the government for rejecting his entitlement. In fact, he pointed out the stupidity of the situation by saying that he had been penalised for basically soldiering on in Africa, for doing his job. And he is right. He did what he was supposed to do. He fought a brave fight, he escaped and he went on to keep fighting. Now, he no longer has the strength to continue the fight with this government.
Today I call on the Minister for Finance and Deregulation to review his case, to consider the facts, to show some compassion and to make an ex gratia payment to this soldier and other soldiers like him while there is still time to recognise what they have done for their country. Mr Collett is not only soldier being let down by the military and the federal government. Even today soldiers are penalised for doing their duty. We have the absurd situation where special forces soldiers face court martialling for killing people in battle—in the heat of the moment, in the middle of a hostile encounter, where no rational man or woman would expect them to act differently.
I do not believe that the Defence Legal Services is living up to our commitment to our soldiers or at least the commitment we should be giving our soldiers. Our retired military personnel still have to deal with an imperfect system and some of the flaws can be addressed simply by using an up-to-date life expectancy table. As I understand it, the DFRDB Act calculates how much to reduce retired pay due to commutation of part of that income stream using a life expectancy table that was issued in 1963.
Does that make a lot of difference? Quite a lot, in fact. A 44-year-old male has a life expectancy of another 28.25 years according to that table, but, according to the Australian Bureau of Statistics life table, he can expect to live for another 37.2 years. That is a difference of nearly nine years. When this is translated into dollar terms, it is a reduction in retired pay of $851.65 per year. The delivery is not right and fixing the delivery is as simple as updating the life expectancy table.
It is an imperfect system and we may never have it perfect, but we can strive to make it the best that we can. The Liberal-National coalition are committed to real reform of military superannuation. We are the only ones in this parliament committed to that reform. There are flaws with the Defence Force Retirement and Death Benefits Scheme and it is the Liberal-National coalition that have brought a bill into this parliament to address those flaws. We want to see the DFRDB and DFRB superannuants over the age of 55 have their pensions indexed in the same manner as the service pension and other Australian government income support pensions.
The ex-service community have recognised the flaw and are fully onboard with the changes outlined in the coalition’s bill in order to fix them. They are changes that make sense in the same way that changes outlined in the amendment bill we are addressing today make sense. We support these changes and we call on the other parties in this parliament and the government to support those changes that make sense where that occasion arises.
By remembering the commitment our service men and women give to us and have given to us and ensuring we honour a commensurate commitment to them, we can continue to monitor benefit schemes for any inequities and flaws to continually provide better outcomes. We can walk down an avenue lined with mango trees, perhaps in Eimeo, and think about what that represents. We can think about who paid the ultimate price. We can think about those who lived through those ordeals, people like Fred Collett, and we can think about how we treat them. If we are fair dinkum, we will see where the system is not right and we will fix the system.
Fred helped build this nation for a century and he deserves better than being penalised for doing a good job. Again I appeal to the finance minister to take a walk down a memorial avenue of mango trees in my electorate, even if it is just a virtual walk, and see why making an ex gratia payment to this man is the right thing to do.
I am pleased to rise to speak to the Military Rehabilitation and Compensation Amendment (MRCA Supplement) Bill 2011 that is before this chamber and indicate, as others have in this debate, that the coalition will support this bill. It is noncontroversial; in fact, it goes some way towards making sure that we do not have an unintended consequence continue. The bill effectively clarifies arrangements under the Military Rehabilitation and Compensation Act relating to payment of certain allowances to war widows. This bill is necessary because of an unintended consequence arising from the government’s changes to pensions as part of the Harmer review in 2009. I am pleased that both sides of politics were able to come together to ensure that we do not have a situation arise where eligible war widows are inadvertently receiving benefits they are not properly entitled to and which would result in a debt being owed to the Commonwealth.
The veterans community, both war widows and more broadly, is a crucial part of the fabric of the community in my seat of Moncrieff. Gold Coast city has one of the larger veterans populations in Australia. I am certainly very pleased and proud to be a strong advocate for my veterans community in doing what I can to be both an ambassador and a representative for them in this chamber. There is an array of issues for the veterans community that, although not a central part of this bill, remain ongoing issues of concern to them.
Over the years I have been honoured to work very closely with so many fine advocates from the veterans community. I think immediately of groups such as the TPI Association, Gold Coast Legacy, the Vietnam Veterans Federation and the Vietnam Veterans Association of Australia, and of course the work that is done by the three RSL clubs in my electorate—at Nerang, Southport and Surfers Paradise—and the advocates in each of those clubs. More broadly, there are other community groups, such as the Korean Veterans Association and those who represent the strong work that was done by the British Occupation Forces. Each of those groups—and I have named just some of them—play a crucial role as advocates, and as conduits for veterans and their loved ones with respect to the entitlements that are available to them and the way in which those entitlements are handled.
One of the best things I have done, if I might put it that way, was to start a veterans kitchen cabinet. I hold a roundtable discussion with representatives of the ex-service organisations in my electorate about every six months or so. It is a chance for us all to come together and speak about what can be done with respect to veterans’ entitlements and issues such as military rehabilitation and compensation available to members of the military. In that vein, I see it as a central part of my role to represent them and their needs and to be an advocate for them in this parliament. I have been pleased to work with the coalition minister when we were in government and with the Minister for Veterans’ Affairs, now that we are in opposition, in a proactive way and in the best interests of the veterans community.
There are a number of veterans’ projects with significance, both in their symbolic value and also their impact on the livelihoods of veterans and their loved ones, that are taking place in my electorate of Moncrieff on the Gold Coast. I welcome the amazing efforts that George Friend and the Rotary clubs on the Gold Coast have been making with respect to the Kokoda memorial at Cascade Gardens. I supported very strongly their push to have that memorial recognised as a memorial of national significance, working alongside the Gold Coast City Council and others to make sure that that has the support and backing of the local community. Unfortunately on this occasion for veterans, it was not deemed to be of a scale, design and standard appropriate for a memorial of national significance, so it was not accepted. But I intend to keep being an advocate and keep pushing on behalf of my veterans community for it to be recognised as a memorial of national significance.
Very shortly, the Korean Veterans Association will also be looking at putting a memorial alongside the Kokoda memorial in the Cascade Gardens. I know the work that is being undertaken by Paul Findlay from the Gold Coast’s TPI Association, who are looking at transferring their facility and meeting place to Cascade Gardens. We are developing a real epicentre of veterans work and veterans groups at Cascade Gardens, at Broadbeach on the Gold Coast. In this respect as well, I want to work alongside them to achieve the outcomes they are after.
More broadly, I am mindful that the government currently has the Campbell Review of military compensation arrangements before it. I welcome the government’s release of the review’s findings on Friday, 18 March, not that long ago. I note that the review is some 12 months late; notwithstanding that, it is a significant review. I am committed to liaising with my veterans groups to hear their thoughts as a result of the review, take on board their feedback and work constructively with them, and then feed that back through both the shadow minister and the minister to make sure that, over the period of consultation between now and 30 June this year, we are able to improve military compensation arrangements for the benefit of not only those who have made tremendous sacrifices for us by putting themselves in harm’s way but also their loved ones.
This bill before us, although a modest bill in terms of its effect, is an important bill and it has the coalition’s support. When it comes to veterans matters, I want to ensure that there remains a strong sense of bipartisanship, because all of us as representatives in this chamber recognise that our veterans are the ones who have ultimately been at the front end, at the pointy end, of upholding the values and freedoms that we all enjoy as Australians. In that sense, as an ambassador for them I look forward to working with my veterans community and making sure that, when it comes to military rehabilitation and compensation matters, we always keep the needs of the veterans community front of mind.
I welcome the opportunity to speak on the Military Rehabilitation and Compensation Amendment (MRCA Supplement) Bill 2011. The primary purpose of this bill is to amend the Military Rehabilitation and Compensation Act 2004, relating to the payment of certain allowances to war widows. This is necessary due to unintended consequences of the government’s changes to pensions as part of the Harmer review which amended legislation in 2009. The act provides compensation for and other benefits to current and former members of the Australian Defence Force who suffered an injury or disease due to service on or after 1 July 2004. It also provides for the dependants of members whose deaths were the result of an injury or disease due to service on or after 1 July 2004. The bill ensures that wholly dependent partners of a deceased Defence Force member or former member will be eligible to receive the MRCA supplement, while preventing duplicate payments of the MRCA supplement to persons who are entitled to equivalent payments under a different act.
I acknowledge that this bill could potentially affect 105 war widow pensioners in my electorate of Solomon who are current clients of the Department of Veterans’ Affairs—as of 1 October 2010. However, it is important to note that, while this is largely a housekeeping bill, it will ensure that the benefits are not paid to those who are not entitled to them under this act and who, as a result, will no longer have the potential to be in debt to the Commonwealth.
Another veterans affairs issue that the parliament is debating at the moment—it is currently before the Senate—is the coalition’s military superannuation reform legislation, the Defence Force Retirement and Death Benefits Amendment (Fair Indexation) Bill 2010. The bill will improve the indexation of Defence Force Retirement and Death Benefits, DFRDB, Scheme superannuation pensions from 1 July this year. I am pleased to say that this means that eligible superannuants aged 55 and over on 1 July 2011 will have their military superannuation pensions indexed in the same way as Australian government income support pensions such as the service pension. This is the single biggest issue in the veterans and ex-service community. It has long been called for, and it has the full support of the ex-service community. I remind other members here today that the coalition remains the only party in the parliament committed to military superannuation reform. I take this opportunity to call on all parties in this parliament and, in particular, the Labor Party to support this legislation when it is debated in the House.
The coalition welcomes the release of the review of the military compensation arrangements, which were publicly released on 18 March. It should be noted, however, that this review is some 12 months late. Nevertheless, this is a significant review into a new and complex piece of legislation.
The coalition is committed to an extensive consultation on the review’s findings and is pleased that the Gillard Labor government has agreed to a period of consultation until 30 June 2011. During this consultation, the coalition will endeavour to liaise with key stakeholders in the service, ex-service and veteran community about the recommendations in the review of the military compensation arrangements.
Finally, with Anzac Day—a national day of remembrance in Australia and New Zealand to commemorate the lives lost and honour those members of the Australian and New Zealand Army Corps who fought at Gallipoli and Turkey during World War I—under five weeks away, it is a very timely welcome to the eleventh-hour rescue package for the Australian War Memorial. This is despite the fact that the government had to be dragged kicking and screaming into making an announcement, which is an absolute utter disgrace.
Ha ha ha!
You may laugh, Member for Lingiari, but we know what was going on behind the scenes. The $25 million commitment from the coalition to refurbish the World War I galleries is yet to be matched by the Gillard Labor government. As members of this place should be aware, the Australian War Memorial combines a shrine, a world-class museum and an extensive archive. The memorial’s purpose is to commemorate the sacrifice of those Australians who have died in war. Its mission is to assist Australians to remember, interpret and understand the Australian experience of war and its enduring impact on Australian society. This is a very important part of our history. The coalition will therefore be looking for a firm financial commitment from this government in this year’s budget to complete the redevelopment ahead of the ANZAC centenary in 2015.
I have earlier this year in the House mentioned the commemorative services held to mark the 69th anniversary of the bombing of Darwin. The bombings are a significant part of the history of Darwin, the Northern Territory and, indeed, Australia. Like Anzac Day, these commemorations have enormous significance for those who were in Darwin during the air raids, today’s Territorians and Australian Defence Force personnel past and present. I hope that this government will ensure that there is appropriate funding in the budget for the 70th anniversary of the bombing of Darwin. It would also be useful if this event were included in our national curriculum, as it is an important historical event that all students should be aware of.
The seat of Solomon encompasses a number of Australian Defence Force military bases. With many personnel currently serving overseas, I feel that these issues are very important to my constituents, as one day these defence personnel will be veterans themselves. The Larrakeyah Barracks, which incorporates HMAS Coonawarra, is the main base for the Australian Defence Force in the Northern Territory. HMAS Coonawarra is a Royal Australian Navy base which is home to 12 fleet units of the Royal Australian Navy and located in the city of Darwin itself. RAAF Base Darwin, the Royal Australian Air Force base, shares its runway with the Darwin international airport. Robertson Barracks is one of the major Australian Army bases and is located in the outer suburb of Holtze. It is home to the 1st Brigade and the 1st Aviation Regiment. I remind you and those members here that many of my defence constituents are currently serving overseas and so it is important that this government ensure that it looks after these defence personnel both during their service and also after their service to this wonderful country.
In conclusion, the coalition supports this bill. As my colleague the member for Fadden mentioned earlier in this place, the coalition is committed to Australian veterans. This commitment is unlike that of the current Labor government, who in 2007 and again in 2010 committed to fair indexation of taxes and also committed to Australian veterans.
I firstly acknowledge the contributions to this debate by the members for Fadden, Eden-Monaro, Mitchell, Dawson, Moncrieff and Solomon. I am not so sure about the gratuitous advice which has come from some members of the opposition, and I am a bit concerned about their lack of knowledge about what actually goes on in government and their lack of knowledge of the history of the portfolio of veterans’ affairs.
I heard the member for Fadden being critical of the fact that I hold a number of portfolios. The member for Fadden, for whom I have some respect, should know better than most the significant benefits of having a veterans’ affairs minister and Defence personnel minister in the same portfolio. I say this because he should know that the coalition did it for at least the last four years that they were in office. The member for Fadden needs to reacquaint himself with what happened under the Howard government. Bruce Billson, the member for Dunkley, was the Minister for Veterans’ Affairs and the Minister assisting the Minister for Defence. Dee-Anne Kelly, a former member of this place, was the Minister for Veterans’ Affairs from October 2004 to January 2007 and was also the Minister Assisting the Minister for Defence.
We know, and they know, that the veteran community was also supportive of combining the veterans’ affairs and Defence personnel portfolios for the very obvious reason that ultimately we are dealing with the same group of people. Defence personnel who are currently serving members, serving this nation of ours in Afghanistan, will at some point become veterans, and some may be veterans already in the context of their service. Some may even be receiving entitlements under the veterans’ affairs portfolio as a result of their service, and we need to understand that that relationship between the Department of Veterans’ Affairs and the Department of Defence is a crucial one. To have the Defence personnel side of the portfolio married to the Department of Veterans’ Affairs in ministerial arrangements is good for both portfolios. I would have thought that the member for Fadden would have appreciated that, so I think that the sort of gratuitous advice and comments he made were quite unwarranted.
I might also make observations about the contributions by the members for Mitchell and Moncrieff that widows will have to repay significant amounts of money. That is just factually incorrect. No-one will have a debt as a result of this legislation. No payments will be required to be paid back and this bill simply ensures that widows get their correct entitlements. I would hope that these ill-informed members undertake to go into their communities and tell the truth, not mislead people by making comments which are palpably false. We are used to this from the opposition, because clearly they are not engaged in constructive discussion with government or indeed the community about what is good for this country. They are quite critical of us, and sometimes that might well be warranted, but in this particular instance it is not at all warranted. I would say to them: understand the facts of the matter and make sure that when you espouse your views about legislation such as this you actually deliver the correct interpretation of what the legislation delivers.
I am also a little bit bemused by comments made by members of the opposition about this government’s performance within the veterans’ affairs portfolio. We know that in the 12 years prior to 2007 the former Howard government—the government that these erstwhile members of a potential future government say they have some respect for—did almost nothing in veterans’ affairs. Since 2007 this government has delivered on a wide range of initiatives that benefit the veteran and Defence communities.
The opposition has criticised the government for the so-called delays on releasing the military compensation review. Again—and I know that butter would not melt in their mouths—the truth of it is that this is just an extraordinary comment from a party who refused to even consider reviewing the legislation prior to the 2007 election. Let us be clear: they refused to undertake a review of the legislation prior to the 2007 election. So it is passing cute that they should come into this place and criticise the government for undertaking a review and providing the capacity for people to comment on that review once we have released it, which was done last week.
I say to the opposition: if you think you are running government from the opposition, I have news for you. You are like a pimple on the elephant’s bum. Your impact upon us in terms of this portfolio is zero. We have made successive decisions, including the ones around the War Memorial, which were based on good public policy decision-making processes, including advice from the War Memorial and our own public service, not based on some comments—often hysterical—made by opposition members, including their spokesman on veterans’ affairs. We deliberated clearly on the need to ensure that the War Memorial was appropriately funded. We had discussions with our local members, one of whom is, astoundingly, sitting here next to me and I thank her for being here. It is her duty of course—not to be here with me, but the fact she is here.
It’s for you.
Oh, please! But I am absolutely very proud of the more than $8 million that has been made available to the War Memorial on an annual basis to increase its funding base. That is an increase of almost 25 per cent. Let us understand what we have done here. We have provided an increase of around 25 per cent, if not more, to the baseline funding of the Australian War Memorial. Ask yourselves this, members of the opposition: what did you do in that space? I am quite proud of the decision which has been made by this government, driven in this instance by the Prime Minister, who said to us—me and the Minister for Finance, Senator Wong—last October, ‘I want you to undertake a review of the financial arrangements of the Australian War Memorial and come back and give advice to cabinet.’ Which we did. On the leadership of the Prime Minister, that was acted upon and the result was the increased funding to the War Memorial. So let us not have any of this—I am not quite sure how you would describe it—‘view’ that is being expressed. I was very careful—
I am conscious of the minister’s very flamboyant expressions. I appreciate them very well, and I am very thankful that he is being very careful.
Very careful! And to suggest that somehow or another this funding increase was a result of pressure from the opposition is just laughable. Absolutely laughable. As is the suggestion that we are putting the MRCA review recommendations out for public consultation because of pressure from them. What do they think we do in this place? We undertook the review. It was always behoven on us to make sure that that review was published and, of course, at the same time released for comment to inform the government of what people involved—the ex-service community organisations and other people with an interest in the area—thought of the issues involved in the MRCA review and to provide feedback to us prior to us making any final decisions on the outcome. Good public policy practice. Not something that came about as a result of any pressure or words from the opposition. So let us appreciate this. We have a very good Department of Veterans’ Affairs; we have very good, high-quality advice from that department. I have very good, high-quality staff and I do not need the sideline comments coming from opposition members who should be better informed of what goes on in government. I want to say to them: understand that when you are in government you accept responsibilities, and one of the responsibilities you have is to listen to advice. And that is what we do; we seek advice and I am pleased that we do so.
I conclude on this bill, which of course is what we are here for. This bill is not as it has been described by the opposition. This is a normal process of refining and reviewing legislation. That is it. Governments of both political persuasions have historically reviewed legislation and made minor amendments when required. There is nothing unusual about this. I know you would appreciate this, Madam Deputy Speaker, because I know you well and you know me well—probably unfortunately from your point of view. There is nothing unusual and the opposition is really clutching at straws to suggest otherwise. The changes to the MRCA supplement were as a result of significant income support reforms implemented by the government in 2009 and I am very pleased to be here summing up on this legislation. I thank all of the members who have contributed, even if some of their contributions were ill informed and wrongly based.
Question agreed to.
Bill read a second time.
Message from the Governor-General recommending appropriation announced.
Ordered that this bill be reported to the House without amendment.
Debate resumed from 23 February, on motion by Mr Garrett:
That this bill be now read a second time.
I am very pleased to rise today to speak in support of the Family Assistance and Other Legislation Amendment (Child Care and Other Measures) Bill 2011. This bill is a fantastic initiative that will have a very positive impact on the people of Greenway, and I thank the minister for her ongoing commitment to helping young families. As I think all of us here would agree, this week we have seen some substantial legislative reforms in both the childcare and family services sectors going through this parliament. They are legislative reforms that are very important to the families we represent.
I want to make a few comments on the rationale for this bill. This bill outlines a range of amendments that will improve childcare services in Australia and will greatly assist young families to balance both the financial and non-financial challenges that, as I said the other day, are part and parcel of raising children. This bill outlines a number of amendments that will ultimately improve accountability in the childcare sector. This increased accountability will improve the quality of services, will increase efficiency and will allow for more affordable childcare services. It does this by broadening the powers of the secretary to ensure that childcare operators are managing their affairs in what is called a fit and proper way. This increased scrutiny will safeguard against unscrupulous behaviour that some operators may, unfortunately, choose to engage in and which would have the result of hurting the services that young Australian families rely on.
Some parts of this bill had their genesis in issues such as the ABC Learning collapse and the lessons that were learnt from that. I had a couple of ABC childcare service operators in my electorate. It engendered great alarm in the community when ABC Learning collapsed. I was on the Blacktown City Council at that time and there was great concern that council services would be inundated and council would need to have an appropriate response to that. The increased scrutiny that will be provided by this amendment will ensure that private childcare operators who run up debts owed to the Commonwealth can be held accountable for their actions. In fact, the ABC Learning collapse provides us with an appropriate case study as to why this bill is such an important part of childcare reform.
The meteoric rise of ABC Learning saw the company turn over large profits and rapidly expand in a very short period of time. It made people such as its founder, Eddy Groves, quite wealthy. All was seen to be running very smoothly for this operator, who provided childcare services to what I believe were almost 100,000 Australian families—so that is an enormous number across the country. As we all well know, ABC Learning’s honeymoon period did not last very long. As Mr Groves sought to expand his operations overseas, amongst other things, and neglected to scrutinise his low-margin Australian operations, the company collapsed. If it had not been for decisive action, families would have been faced with closed childcare providers around the country. Thanks to this government’s actions, 90 per cent of the former ABC centres are still fully operational today in some form.
University of Western Sydney accounting expert Dr Philip Ross described the collapse of ABC learning in the Sydney Morning Herald as follows and it is quite instructive to see what he had to say:
ABC Learning’s profits increased rapidly through acquisitions, which should have raised questions about the underlying valuation of assets it acquired—especially given that 70 per cent of its assets were intangibles. The inherent risk associated with the valuation of the assets was enormous and should have been a red flag.
By giving the government greater scrutiny over childcare operators this bill ensures that red flags will be made in future, and ensure that ABC Learning will, one hopes, be the last childcare operator to collapse in such a way. This bill will go a long way towards achieving that objective, which I am sure we all share in this place.
A division having been called in the House of Representatives—
Sitting suspended from 12.15 pm to 12.27 pm
I was talking about the national quality framework and how this bill, as well as increasing scrutiny of the childcare sector by broadening the powers of the secretary, supports the government’s national quality framework. This framework has been endorsed by the Council of Australian Governments with the intention of improving a range of issues surrounding the childcare sector. The national quality framework continues this bill’s work to improve transparency and increase the scrutiny of childcare operators. These improvements will ensure key performance indicators are maintained and the quality of child care is of a standard befitting the nearly 700,000 young Australian families who are eligible for the childcare rebate.
The national quality framework is an extremely important investment that will work to ensure childcare quality is maintained. This framework will specifically work to ensure that educator to child ratios are as high as possible, allowing children increased one-on-one time with teachers, and to limit overcrowded classes. It introduces educator qualification requirements that will help services provide the best possible level of early childhood education and care by being clear about the factors that best support a child’s development. It includes a new rating system so that parents know exactly how good the quality of care is that their children are receiving, and thus improve the transparency. It reduces regulations so childcare services will have to deal with only one regulatory body. We can, therefore, see that this framework provides a number of very important positive impacts for the childcare industry and as a result will greatly improve those services that are ultimately provided to Australian families.
In speaking on the Family Assistance Legislation Amendment (Child Care Rebate) Bill 2011 in the chamber earlier this week, some people commented that the national quality framework, despite being supported by COAG and being scrutinised by over 1,600 Australian citizens during the consultation process, would actually increase financial pressure on families. To the contrary, as the minister indicated last week, the National Childcare Accreditation Council released its latest report into the quality of childcare services in Australia and the results indicated that far too many were failing to meet basic standards of hygiene, safety and education. As the minister said, many parents would be horrified by some of the statistics and they demonstrate just how critical is the government’s commitment to lift the quality of Australian childcare centres. Amongst some of the data revealed was that 25 per cent failed to ensure that potentially dangerous products, plants and objects were inaccessible to children and 20 per cent did not act to control the spread of infectious diseases and maintain records of immunisations.
These are things that need to be improved, and information about the national quality framework can be found on the MyChild website. I think that transparency is something that every member of this House would support and be concerned to support, in particular in relation to the health and wellbeing of children. In my former role as a counsellor I had responsibility for many childcare centres across the Blacktown local government area. I am sure the member for Canberra agrees that ensuring that there is transparency is important, as parents will always seek to ensure that they are sending their children to a centre which is providing the best care. They should have access to that information, and where the childcare centre is falling down on the job the centre should improve and parents should have the choice of where to send their children to obtain the best quality care. This framework will greatly aid Australian families and, as I said, ensure they are equipped with the right information to ensure that they are also getting the best value for money for the care that is provided to their children. I put it to those opposite that I am sure they would not want to see another ABC Learning debacle. I am sure they would want to ensure that all children receive the highest standards of care under the national quality framework.
As we all know, quality child care is an integral service for Australian families. It allows workplace participation for parents, particularly women returning to the workforce, and also allows our young people the opportunity for early education in the crucial first five years of their development. As I said this week when commenting on improvements to childcare services—and I think it is a very important point to reiterate—it is very clear that a flexible and affordable childcare system allows our children to have access to early education. Why is that important? It is important because it allows for enhanced social development and learning opportunities at a young age. The case is clear and it is emphasised in the Child care and early education in Australia report from 2009, which states:
Children who did not attend a formal early childhood program had lower scores for receptive vocabulary than children in pre-Year 1 and preschool programs …
This demonstrates how quality child care is an integral stepping stone to preparing our children for the new environment that is primary education. This government realises how important those initial stages of development are.
I want to say a few things about the amendments in relation to fit and proper purposes. In broadening the powers of the Commonwealth in the childcare sector, this legislation will make certain that childcare operators are considered to be fit and proper. In making certain that they are in a fit state to manage their businesses, all Australian families will be able to rest assured that their childcare providers will not collapse overnight and throw their highly important childcare needs out the window. This legislation makes sense. It creates increased accountability and introduces a range of necessary safeguards to ensure that childcare services in Australia are of the highest standard and maintained in a proper manner.
I now turn to the privacy aspects of this bill and the sharing of information and why this is important. In supporting the national quality framework, this bill has amended protected information laws, which will work to reduce red tape and streamline childcare services in Australia. Specifically, the bill will enable the Commonwealth to share information on childcare services with state and territory regulatory bodies. That protected information will need to be collected, used and disclosed in a manner that is consistent with the existing privacy regulations that remain in place. At the same time it will reduce bureaucracy and improve efficiency in the sector and, as a result of this amendment, childcare services will not have to provide the same information to more than one body.
In conclusion, this bill provides a range of highly necessary amendments. It will increase accountability; improve efficiency and the quality of childcare services; and overall deliver a very positive result to young families. I again thank the minister for her hard work in this area and her ongoing interest, in particular in the provision of childcare services in the electorate of Greenway, which, when you look at the statistics, really is Australia’s nursery. I commend the bill to the House.
Debate (on motion by Ms Brodtmann) adjourned.
I move:
That the Main Committee do now adjourn.
I would like to make some brief remarks about Teach for Australia, which, as you may be aware, Mr Deputy Speaker Slipper, is an outstanding initiative that targets top non-teacher graduates and places them in, typically, disadvantaged schools. This initiative is based on very successful models in the United States and the United Kingdom—respectively, Teach for America and Teach First. In essence, the initiative attracts a different type of person into teaching. They are people who would not ordinarily be interested in teaching, but they are the types of people that we should be seeking out and getting into teaching in our schools.
I have been involved in this initiative since its inception. I was actually involved in helping to design the initial proposal right at the very beginning, about five or six years ago, when I was working in Far North Queensland at the Cape York Institute for Policy and Leadership. I was involved in establishing the Teach for Australia organisation and, indeed, I remain on its board today. This is now the second year that we have young non-teacher graduates—we call them associates—placed in schools. Last year was the first year. We have 85 outstanding young graduates, associates, in schools predominantly in Victoria, but this year they are also starting in the Australian Capital Territory, and next year we are hoping—and it is most likely—that we will have some graduates starting also in Western Australia and possibly in South Australia.
It is relatively early days for this program, but to date the results have been quite outstanding. Over the last two years, we have had something like 1,500 applications for the Teach for Australia associate program—1,500 applications for, now, 85 placements. Clearly, as an organisation Teach for Australia is reaching many young people and it is an attractive program for those young people to apply to. The actual associates that we have been recruiting and placing in schools are outstanding young Australians. They are, typically, exceptionally high performers at university but, equally important, they also have a number of other attributes which the organisation thinks will make them exceptionally good schoolteachers, including leadership skills, community involvement and terrific interpersonal skills. One such associate, whom I was just speaking to on Tuesday night at the ACT launch of the Teach for Australia program, is an outstanding young woman who, before joining the program, was over in India starting up an orphanage there. It is that type of person that we are attracting into the program—someone who has not only fantastic education results but also broad experience.
The feedback from school principals, which of course is very important, has been excellent. The principals are basically unanimous in the view that the overall quality of the individuals that Teach for Australia delivers to disadvantaged schools is unquestionable. I will just quote a couple of the school principals. Tony Simpson, for example, is Principal of Copperfield College. He took seven associates into his school last year. He says:
“Every single one of our Associates is very successful in the classroom.”
Similarly, Trish Horner, the Principal at Mill Park Secondary College in Victoria, who has taken 10 associates all up, has said:
“It’s one of the best decisions I’ve made as a Principal … the conversations about teaching in the staff room now … is on such a high level, and that’s because of the Associates.”
I will not go into other details and the results which those associates have been achieving for their students, but they are also outstanding.
I had the pleasure recently of going to a school in my electorate, Fairhills High School, which this year has two Teach for Australia associates operating in the school, Hugh Bachmann and Melanie Henry. I am sure they will be as successful as the other Teach for Australia associates have been. I wanted to record my strong support for this program. There are many partners involved with it which make it a success, but I am a very proud board member and proud to support that initiative.
Saturday, 12 March, marked the end of a journey, with the official opening of stages 4 and 5 of the Fernleigh Track. This is a journey that commenced in 1993 after some years of negotiation. Lake Macquarie City Council and Newcastle City Council jointly purchased the former 15.5-kilometre private railway corridor between Adamstown and Belmont. Since that time the project has been a model of what local governments can do when they work together, what local government and state government can do when they work together and, since 2007, what local, state and federal governments can achieve when they work together.
The completion of this track is also a success for the people who will enjoy using it. It is already widely used by people who walk or cycle on it. It is a transport corridor between Newcastle and Lake Macquarie, with more and more people using it all the way, and it will be enjoyed for years to come. The track features a brick lined tunnel under the Pacific Highway and has focused on preserving the history of the corridor, with any possible rail track being left in place.
The Fernleigh Track is a major regional tourist attraction as well as being a transport corridor which will promote exercise and healthy lifestyle. It will encourage people to visit the region just to walk the track. In addition it will positively contribute to our ongoing fight against obesity. It is the type of structure that should be built in many communities throughout Australia. After a great effort from local, state and federal members of parliament, this innovative track has been adequately funded and completed and has given Shortland and the Hunter region a magnificent track for all members of the community and visitors.
I would like to pay tribute to former Lake Macquarie councillors John Jenkins and Alan Shields, who worked very hard in the early stages to see that both the councils came together and purchased this corridor. I also want to pay tribute to Marilyn Eade and Ed Tonks and representatives from the Newcastle Cycleways Movement and the Parks and Playgrounds Movement, particularly Doug Lithgow. In addition, the former state member for Charlestown, Richard Face, made an enormous contribution in the early days. Subsequently, the current member for Charlestown, Matthew Morris, has continued to support the program, as has the member for Swansea, Robert Coombs, who is very supportive and worked hard to see that the track was completed at Belmont. I also want to pay tribute to Ken Powers, Richard Sherry and Stuart Dawson for the contributions they have made.
The pathway winds through both suburbia and bushland, preserving pieces of early Australian history dating back to the 1880s. The finished Fernleigh Track entails shared cycle and walking paths. It stretches 15.9 kilometres, from Adamstown to Belmont TAFE, and passes through Kahibah, Whitebridge, Redhead and Jewells.
As I have said, the pathway winds through a number of different environments. The track will benefit current members of the community and will be an asset for future generations. The Fernleigh Track will be an important part of the state’s coastal cycle ways and has many local cycling enthusiasts enthralled with its completion. This stage of the Fernleigh Track not only offers members of the community a beautiful walk through Belmont Wetlands State Park but offers a safer alternative for cyclists.
On 2 April I will be attending the Fernleigh Track family day. This day has been put aside to celebrate the completion of the Fernleigh Track. It will be a day when everybody can get together and enjoy the history of the area and enjoy this fine track that has now been completed.
I rise today to table a petition. This petition of certain citizens of Australia draws to the attention of the House that Australia Post have sold the Warrnambool Post Office Timor Street building to the Warrnambool City Council. Whilst an agreement is in place to retain private mail boxes, the business centre will be closed and the smaller 169 Koroit Street premises will become the city’s main Australia Post business centre. This already small site will not be able to provide an adequate counter service for a city with a rapidly growing population presently exceeding 33,000 people. At Timor Street, as a considerable convenience to business people, general customers and senior citizens, adjoining streets provide 26 designated free 15-minute car spaces, including two disabled spaces—something that seems impossible in relation to the Koroit Street location.
The present size of the Koroit Street business centre will surely not enable remodelling to allow transfer of similar counter space to that used at Timor Street. Both premises are already barely adequate at many times of the day and there are frequent lengthy queues. We therefore ask the House to ensure Australia Post negotiates to retain a satisfactory business centre in Timor Street, where it has been most satisfactorily located since 1857, or else provide an additional adequate alternative.
This petition has 3,331 signatures. It is a sizeable petition. I would hope that Australia Post will take note of it and do the right thing. The consultation process around the closure of the Timor Street post office was nothing short of disgraceful. There was no consultation with the community at all. The community was taken by surprise with this closure. It was announced around Christmas time, when I think it was hoped there would be as little notice of this decision as possible. Warrnambool has a growing population—33,000 people and expanding. It has to ensure that it has proper postal services to adequately cope with this expanding population. Closing the main post office which, as the petition states, has been there since 1857, is just not good enough. Australia Post should have consulted with the community before taking this decision.
I congratulate Judy and Bill Poynton, who have organised this petition. They came to see me and asked what needed to be done to try and overturn this decision because I had put an advertisement in the local paper asking people whether they thought postal services were adequate for the local community. I have not come across anyone who says that the services are adequate, so how closing the Timor Street post office is going to help postal services in the Warrnambool and surrounding communities is beyond me. I call on Australia Post to negotiation with the Warrnambool City Council, who they have sold this building to, to make sure that they can maintain adequate services at the post office. If they do not, I will put the Minister for Broadband, Communications and the Digital Economy, Senator Conroy, on notice that I will be calling on him to take some action on this matter.
It is not good enough that Australia Post comes along and just makes a unilateral decision to close a building without adequately providing alternative services and without talking to the local community and saying, ‘What are your needs?’ including ‘What are your parking needs and what are your disabled parking needs?’ This decision by Australia Post has caught the community by surprise. There is outrage, especially among older citizens, that they would take away what is a convenient location which they have been using, some of them, for 75 years.
I congratulate Judy and Bill Poynton. I ask Australia Post to negotiate with the Warrnambool City Council to make sure that there are adequate services provided at the Timor Street Post Office. I also say to Senator Conroy, ‘Beware. If Australia Post do not make the right decision here, you need to intervene and fix this mess.’
The petition has been checked by the committee and is in order. It is received pursuant to standing order 207B(2).
The petition read as follows—
To the Honourable The Speaker and Members of the House of Representatives
This petition of certain citizens of Australia draws to the attention of the House that Australia Post have sold the Warrnambool Post Office Timor Street building to the Warrnambool City Council and whist an agreement is in place to retain Private Mail Boxes, the business centre will be closed and the smaller 169 Koroit Street premises will become the city’s main Australia Post business centre. This already small site will not be able to provide an adequate counter service for a city with a rapidly growing population presently exceeding 33,000. At Timor Street, as a considerable convenience to business people, general customers and senior citizens, adjoining streets provide 26 designated free 15 minute car spaces (including 2 disabled)—something that seems impossible in relation to the Koroit street location. The present size of the Koroit Street business centre will surely not enable remodelling to allow transfer of similar counter space to that used at Timor Street. Both premises are already barely adequate at many times of the day and there are frequent lengthy queues.
We therefore ask the House to ensure Australia Post negotiates to retain a satisfactory business centre in Timor Street where it has been most satisfactorily located since 1857 or else provide an additional adequate alternative.
From 3,331 citizens.
Petition received.
I wish to put on the public record in this place my views on climate change and putting a price on carbon, and make further comments about the Australian Labor government’s plans to lower carbon pollution and transition our economy to a clean-energy economy.
In my area there is an organisation or collaboration called Sustain Northern Rivers. It started a few years back to tackle the issue of climate change. It is a collaboration and a particular model. It embraces local governments, government departments, agencies and community organisations. They are working on the ground in the community realising that climate change and human contribution to it is a factor and that we have to take action. I am very pleased to have that happening right across my area. I know that we will be doing some more work in the low-carbon communities with them.
People ask: why are we acting? It is absolutely clear to most people that the Australian Labor government is taking action to cut pollution, tackle climate change and create a clean-energy nation. In a choice between action and inaction, we will act. We do not have to lead the world but we cannot afford to be left behind. If we do not act we will see more of the extreme weather events like bushfires, droughts, floods and coastal erosion that we have seen. In my area we will have all of those extreme weather events. We will have more days of extreme heat and we will see our coastline flooded as the sea level rises. If we do not act, Australian jobs will go offshore as the rest of the world overtakes us.
The next question is: how will it work? At the moment, polluters do not have to pay for the pollution they produce. Under a carbon price, the top 1,000 biggest polluters will pay for every tonne of carbon pollution. The more a company pollutes, the more they pay. Those that lower their emissions will be rewarded—as they should be—through paying less tax than the big polluters. Polluters that do not cut their pollution and try to simply pass the costs on will be undercut by companies that do the right thing and invest in clean energy.
The government will then use every cent raised from industry to provide generous household assistance to help with family budgets, protect jobs as businesses make the transition to a clean-energy economy and invest in climate change programs. I will be asking for some of that investment in my area for Sustain Northern Rivers.
There are some key issues around a carbon price. First of all, we on the Labor side believe climate change is real and taking action is the right thing to do. We want the top 1,000 biggest polluting companies to pay for each tonne of carbon pollution they produce. A carbon price will provide incentives for the big polluters to reduce their carbon pollution.
Australia is the worst per-head carbon emitter in the developed world. Other countries are taking action—even China and India. Australia must make a start or our economy will be left behind. We will protect existing jobs while creating new, clean energy jobs. I have some of those already in my area and in my home town of Lismore.
Every cent raised by the carbon price will go to households, to protecting jobs in businesses in transition and to investment in climate change programs. That is what Labor governments do: look after households. There will be generous assistance to households, families and pensioners, and tax cuts are certainly a live option.
Whereas we believe that climate change is real, the coalition deny it. We believe that tackling climate change is the right thing to do, and they are playing politics with a very serious issue. We want the top 1,000 polluters to pay for carbon pollution, and they want to reward them. We want to provide households and pensioners with generous assistance, and their plan, which they are not telling us about, will slug families $720 to subsidise the big polluters. We want to tax big polluters and provide assistance to families, and they want to tax families and provide handouts to big polluters. We want to create a clean energy nation, and their plan is to run a scare campaign against the national interest. We want to build a clean energy economy, and they will endanger our prosperity and jobs.
Tony Abbott is out there saying that we should wait for the rest of the world, but that makes no sense. He has committed to the same carbon reductions that we have, so either he is admitting his plan will not achieve these reductions or he is admitting that the world is moving—and it is one way or the other. (Time expired)
I would remind the honourable member for Page of the provisions of standing order 64, which provides that she should refer to honourable members, including the Leader of the Opposition, by their titles and not by their names.
I rise to speak on a matter which is of great concern to many residents in my electorate, and that is the topic of local crime, vandalism and antisocial behaviour. Local crime and vandalism have been on the rise, particularly over the last 12 months and particularly in the area of Blackwood and the surrounding suburbs. Blackwood and Belair sit in the foothills of Adelaide and are beautiful, generally quiet and relaxing suburbs to live in. But, despite a state government which claims to have put more police on the beat, Friday and Saturday nights are still marred by teenage vandalism and crime. Not more than a fortnight ago, a 26-year-old man was robbed at knifepoint by three teenagers while exiting a train at Belair one evening. The victim was, thankfully, unharmed but had his backpack and wallet stolen. In January, two fires were deliberately lit in the suburbs of Belair and Hawthorndene, and more recently, in late February, a deliberately lit fire burnt through 6,000 square metres of scrub behind the Blackwood High School. It took 19 CFS fighters to contain the blaze.
These brazen acts of crime and vandalism are concerning. But more concerning are more crime and vandalism along Main Road in Blackwood. The vandalism and crime became so bad last year, with graffiti and smashed windows, that the Blackwood Business Network, in conjunction with local businesses, funded private security patrols of armed guards and dogs to patrol the shopping precincts on Friday and Saturday nights, at a cost of up to $2,000. These measures reduced the vandalism and criminal activity in the area by almost 90 per cent. Unfortunately, these measures were financially unsustainable for the local small businesses, and the patrols ended on 31 December. Since then, vandalism has again been on the rise in Blackwood, with a spate of graffiti attacks not more than a month ago.
On 9 August last year, the Hon. Brendan O’Connor, the Minister for Home Affairs, visited my electorate and, with the then ALP candidate, announced $100,000 for CCTV cameras along Main Road in Blackwood. Now, more than seven months on, there are no cameras, no poles and no cables—nothing. This is just another example of saying one thing before the election and doing another thing afterwards. It is another example of all talk and no action. While it is only a fraction of the $300,000 for CCTVs, graffiti-cleaning squads and other security related infrastructure for Blackwood that I announced would be funded by a coalition government, this $100,000 of funding is sorely needed by the local community and long overdue. CCTV cameras assist law enforcement agencies to identify and apprehend criminals. More importantly, they act as deterrents to those who decide to engage in unlawful and criminal behaviour. I call on the federal government to meet their promise to fulfil their election commitment—to get on with it and fund the CCTV cameras in Blackwood to ensure that Blackwood remains a safe place for all residents to live.
Yesterday a rally was held out the front of this Parliament House and also in my home town of Adelaide. Apparently the rally in Adelaide got some 50 people along to it, as reported in today’s Advertiser by Mark Kenny, a very experienced and well-respected journalists for the Adelaide Advertiser. So we have this so-called people’s revolt—some 50 people in Adelaide and a few more here in Canberra.
I thought I might just focus on some of the signs that were held up at yesterday’s rally. There was ‘Science of AWG isn’t settled’—that is anthropological global warming. Another sign said ‘Carbon dioxide is not pollution, I love CO2’. There was one that said ‘Juliar…Bob Brown’s bitch’. There was a sign that said ‘Ditch the witch’. There was a sign that said ‘Great liars are also great magicians. Adolf Hitler’. Others read ‘No multiculturalism Assimilate and Integrate’; ‘What you expect from an atheist in Canberra—ain’t that right Ju-liar?’. Of course there was the old favourite ‘Pauline knew 10 years ago’ and my favourite, which was held up just behind the Leader of the Opposition, the member for Warringah’s head—just behind him as he spoke so eloquently to his audience: ‘Say no to Carbon Tax 4 UN/IMF Global Gov = Agenda 21 Genocide’.
I have for members a copy of that. I am happy to table it, if you wish. It is an interesting sign. I could not for the life of me the work out what it meant, though. It seemed to me to be somewhat confusing. So I went and had a look and it does actually refer to the UN economic and social development guide. There is an agenda 21 there. It espouses such radical concepts as:
(a) Promoting sustainable development through trade liberalization;
(b) Making trade and environment mutually supportive;
(c) Providing adequate financial resources to developing countries and dealing with international debt;
Radical concepts like that! I thought: ‘What could be confusing about free trade?’ So I went and had a look and I found all these weird conspiracy theories like the World Trade Organisation and the World Bank are somehow going to shut America down—end America; I am not quite sure what would happen.
There is another one ‘WHERE WE STAND—The Genocide Agenda—Agenda 21: The United Nations Program of Action.’ There are all these sorts of very interesting observations! I highlighted some of them. One was talking about how we were all going to be forced to live in ‘arcologies’ and vast piles of apartments and the like.
It took me back to last year, of course, when the Leader of the Opposition met with Lord Monckton, who once claimed that AIDS could be resolved by compulsorily blood testing every adult in the population and then isolating AIDS carriers on an island, presumably. He later walked away from those. We do wonder what commitments the Leader of the Opposition gave to Lord Monckton in his private audience with this grand master of climate scepticism. I wonder what commitments were given there.
I have the ABC news report: ‘Abbott pencils end date with Monckton’. That was 3 February of last year. So we know that there is a bit of a problem here with the Liberal Party meeting and associating with and talking to and having a dialogue with these very extreme groups on the loony Right; interactions with these conspiracy group people.
Of course there were other groups along yesterday. The League of Rights, I think, were there. There was the Consumers and Taxpayers Association. Apparently they have three members. There was One Nation. Where would we be without Pauline and the Liberal Party? There was the Coalition of Law Abiding Sporting Shooters. I do not see what they have got to do with climate change. Of course, there was the Lavoisier Group, which apparently thinks that the Kyoto protocol is all about a new imperial structure to relocate Australian sovereignty to Germany. That is very strange. We just wonder: who is going to save the Liberal Party from these extremists? It won’t be Tony Abbott, because even today he is hedging his bets, he is sliding. He refuses to denounce these groups, because he is happy to be associated with them. We are just waiting for Hockey or Turnbull or somebody else to save the great, moderate Liberal Party of this country.
I remind the honourable member for Wakefield that he ought not to ignore standing order 64.
Question agreed to.