Senator CROSSIN (Northern Territory) (12:31): by leave—I move:

That the Legal and Constitutional Affairs Legislation Committee be authorised to hold a private meeting otherwise than in accordance with standing order 33(1) during the sitting of the Senate today, from 1:50 pm.

Question agreed to.

Senator FIERRAVANTI-WELLS (New South Wales) (13:38): I rise to speak on the Personally Controlled Electronic Health Records Bill 2011 and the Personally Controlled Electronic Health Records (Consequential Amendments) Bill 2011. The coalition will not be opposing either of the bills or the amendments to the bills being introduced.

Can I, at the outset, say that the coalition has a strong record on investing and delivering in e-health. For example, it was under a coalition government that the computerisation of general practice increased from 17 per cent in 1997 to 94 per cent in 2007. This was achieved through a $740 million investment over those years. The coalition has always supported the concept of shared electronic health records. Indeed, it was the coalition that originally started the focus on a shared electronic health record. At this point, I pay tribute to the work of past health ministers Michael Wooldridge, Kay Patterson and Tony Abbott, who did a lot of work in this area.

Unfortunately, despite the focus and direction that was established under the Howard government towards e-health, Minister Roxon and the Labor Party's implementation of the system since taking government in 2007 has received severe criticism from industry for its poor management of the programs being developed. One only has to look at the press in recent days to see that this rollout still has major problems—not that that is surprising given the record of both the Rudd and the Gillard Labor governments in quite a number of areas of health.

It is the government's fault that we are now at this point where we will not be ready to go on 1 July. I draw an analogy with the GST. When it was introduced, the legislation had been in place for 12 months before the start date; whereas it is very, very clear that we have so little to show at this point because of the government's poor track record here. Basically, this government has been gradually winding back expectations of what will be available on 1 July. In fact, there will not be much at all. It was so typical of Kevin Rudd to go for the big bang approach. Yesterday we were talking about his so-called health reform as the incoming Prime Minister. He had the grand plan, but we realise that there was not even anything about it written on the back of an envelope. It is the same thing with e-health. He wanted to go for the big bang approach, but as we approach 1 July there will not be much to show for it.

One only needs to look at an article in today's Australian entitled 'E-health record service delayed by incomplete infrastructure'. Here we have an article in the Australian today telling us that the plans that Minister Plibersek had to mark the start of the $1.1 billion e-health records service are on hold as key parts of the system are not ready for the much feted 1 July launch. I quote:

Sources who declined to be named—

I am not surprised—

say a ceremony planned at St Vincent's Hospital in Sydney on Monday, July 2—the first working day of the new system—has been cancelled.

The minister's office was tight-lipped when The Australian asked whether the event had been postponed to a later date.

This, of course, is not surprising. The spokesman for the minister tells us, 'We look forward to the launch of e-health', but we do not know when that launch is going to be. The pilot sites of e-health that were reported last month—and one of the most successful had apparently been at St Vincent's and Mater Health in Sydney, which lends credence to the launch being there—had recruited only 4,446 consumers to its East Sydney Connect shared e-record out of the hoped for 46,800 participants.

There was no comment at all from the minister or her spokesperson in relation to the recent visit by Mr Peter Fleming, the Chief Executive of the National E-health Transition Authority, to deliver the bad news. This, understandably, includes the lack of readiness of the national IT infrastructure that is being built by NEHTA according to specifications, at a cost of $91 million, and that is yet to go live. Here we are, a couple of weeks before 1 July and, no, we are not going live on e-health—which I thought would have been obvious. We know that there are still some critical user verification, authentication, issues. We are going to an interim system, which is going to be provided by Medicare. You cannot go online to register. You can do it by phone or in person at the Medicare office, but you cannot do it online. Also the records system is unlikely to be operational any time soon. So there was a great e-health launch with a great big bang, but we are not seeing very much for our money.

Meanwhile, the costs to take e-health to this point have been topped up to $1.1 billion. The recent budget allocation was of another $224 million and another $50 million for adoption by Medicare Locals. We do not know what Medicare Locals are going to do, let alone what they are going to do in the e-health space. And of course it is more than doubling previous commitments.

Since 2007 there have been problems upon problems in relation to how this government has rolled out e-health. Just to name a few of those problems, the government has repeatedly stated that it would be able to take the user registrations from 1 July this year. Of course, we know that that is not going to happen. One industry expert has been quoted as stating that it will be many years before the system is ubiquitous. Like with so many other announcements by this government, they announced a major project and now they are scrambling to meet their own deadlines.

Legislation was brought on for debate in the House of Representatives long before the Senate inquiry into these bills had concluded. The Senate inquiry in its public hearing on 6 February heard testimony highlighting quite a number of stakeholder concerns with these bills and yet the government pressed on debating them in the House.

Let us just go to some of those concerns. These concerns were outlined by, in particular, the dissenting report by the coalition senators. It indicates that:

There is currently a concerning dissonance between the assurances of the Government and the very real concerns raised by practitioners and experts in the e-health industry.

Naturally the coalition has been concerned that the government's political need for the big bang approach to introducing e-health on a given date is being given primacy over common sense and a proper rollout of the system. The majority of the witnesses that appeared before the Senate inquiry expressed serious concerns with the process so far and the consequences of the legislation if it were to proceed in its present form.

Those concerns broadly covered four major issues: functionality and interoperability of the system; confidence of consumers and clinicians in the proposed e-health system; governance and conflicts-of-interest problems in the system designed to hold the health records of every Australian; and risk and patient safety. These four major concerns are the very spine of a high-quality and safe system and yet in the Senate inquiry a very short period of time ago many witnesses questioned aspects of the potential for successful adoption, functionality and operability of the system within the legislated system, particularly within the time frame. Certainly the major concerns were about adoption, functionality and interoperability.

Issues were raised in the Senate inquiry about the absence of no-access controls, which go to the very heart of the system and further undercut the claims that have been made by the Department of Health and Ageing and NEHTA that the key design features of the system are present. Some have not been. Consumer concerns were raised, and they were also reported. There was much criticism of the consumer complaints provision of the proposed legislation. As I said, issues were raised pertaining to structure and transparency.

A point that was highlighted by coalition senators and raised in evidence as well was that:

… NeHTA is not subject to the standard Government accountability processes, including FOI, this has led to perceived culture of secrecy and a lack of responsiveness to key stakeholders around strategic issues.

Privacy has been a major issue. The Information Commissioner also raised concerns about the adequacy of the proposed legislation in dealing with data breaches. None of these were adequately dealt with in the legislation.

Also there are unanswered questions about medical indemnity and legal liability and the concern that the government has not developed satisfactory processes. There are clearly doubts about the liability in the event of medical misadventure predicated on information contained in the system. All of this casts doubt on the integrity and viability of the proposed legislation.

There is a concern about risks to patient safety. Patient safety is the bedrock of any health system. Those concerns were also highlighted in evidence to the inquiry. They came from industry experts, clinicians, consumers and privacy advocates. Many stakeholders basically said that they had lost confidence in those who were developing the e-health system.

At that stage, when the report was finalised by the Senate, we were barely four months away. We are now two weeks away and we are still debating this issue and concerns are being raised about the system. As I said, with all these concerns, it would have been prudent for the Minister for Health and the government to defer debate on these bills until the Senate inquiry had publicly reported on its findings. Instead, the legislation was rushed through and now we have amendments to the legislation which have to pick up problems. Some of those problems are yet to be resolved and I would like to highlight a number of them that are still of concern. There are concerns about the costs so far and the ongoing funding for NEHTA. I think it is very important in the current economic climate for the government to come clean on the future long-term costs of managing and operating the system. We know that NEHTA's funding agreement expires on 30 June, the day before the system is supposed to go live on 1 July. The Standing Council on Health, as part of the COAG process, has agreed to fund NEHTA after 30 June, but no details have been released as to the level of funding agreed to. Until the budget was released, this uncertainty prevailed.

I have referred to other measures that have been announced. For example, there has been no comment or discussion on the long-term costs relating to the ongoing maintenance of the system, upgrades to the system or the provision of help desk or support staff for the system. One only needs to look at the situation in the United Kingdom, where they spent £12 billion on the e-health record equivalent, which was scrapped in late 2011. This is not a scenario that we can afford to impose on Australia's taxpayers.

When you look at the evidence that was given to the Senate committee and the concerns that were raised by software vendors, they were almost unanimous in their concerns about NEHTA's and their own legal liabilities under the proposed legislation. So I think this is of great concern.

Another concern that has been regularly raised is the lack of encouragement or incentives for general practitioners to create the shared health summaries which are proposed to be part of the system. The health summary is a collection of a patient's medical history and will make up one important part of the system. There have been concerns in relation to confusion from general practitioners over whether they will be able to claim the higher Medicare rebate that would normally apply if setting up an e-health record pushes the consultation into a higher band. There are a number of stakeholders who claim that there was a significant lack of proper and thorough consultation with them. So the list of concerns goes on.

In the remaining time I want to focus on the amendments. As I indicated, the coalition will support the amendments. Whilst these amendments go towards addressing some of the recommendations of the Senate inquiry, there are still some major issues to be looked at, certainly given the media reports that are out there today, to ensure that this system is effectively rolled out.

I would like to underline for the record that it was the coalition that originally referred these bills for inquiry. As I said, the bills were forced through the House of Representatives before the Senate inquiry's report had been handed down. At the time, the coalition called for the deferral of the debate in the House of Reps until the Senate inquiry had been completed, and perhaps we would have saved ourselves a lot of time and angst. But of course the government refused this call and forced the debate regardless. It would have been easier to correct the legislation rather than having to do a patch-up job, and it is very clear now that the bills do not actually achieve all that needs to be done. This is just another example of the incompetence of this government. As we saw today, this is a government that cannot manage its own legislative agenda. How can we expect it to manage something as important as this, manage the budget or indeed manage our country? But we will not go there at this point.

These amendments were introduced following the committee's inquiry. The amendments seek to broaden the scope of the future review of the legislation in two years time, which will include reviewing the identity of the system operator, alternative governance structures for the system and the opt-in nature of the system. I know, having participated in a number of inquiries, these issues were raised directly as a result of various community affairs committee inquiries. Hopefully the amendments will also strengthen the consultation that will be required before PCEHR rules are made and adopted.

One of the major concerns of the Senate inquiry surrounded privacy. Whilst these amendments go some way to resolving particular issues which were raised in the inquiry by clarifying and strengthening the Australian Information Commissioner's functions and powers with respect to investigating breaches, it will be interesting and important to see how these privacy concerns roll out. Under the amendments, the role of the system operator in providing de-identified data for research and public health purposes will be clarified. Provisions contained within the amendments will also strengthen consent arrangements in a number of circumstances. There are also a number of other minor technical amendments. As I said, the coalition will not be opposing these bills.

Senator DI NATALE (Victoria) (13:58): That was a terrific speech from Senator Fierravanti-Wells. I would be interested in hearing a speech where you were going to oppose the government's legislation, because that did not sound like somebody who rose to speak in support of the government's bills. I am pleased to rise today to speak in support of the Personally Controlled Electronic Health Records Bill 2011 and a related bill, because I believe they do advance Australia down the road towards a modern, more efficient and much better connected health system. In this day and age Australians are very familiar with the use of technology. Most Australians, from kids to their grandparents, are now very familiar with the world of instant connectivity. Emails, text messages, sending photos on Facebook—it is all part of their daily lives and it helps individual businesses to thrive.

Debate interrupted.

Senator McEWEN (South Australia—Government Whip in the Senate) (15:31): I present the sixth report for 2012 of the Selection of Bills Committee.

Ordered that the report be adopted.

Senator McEWEN: I seek leave to have the report incorporated in Hansard.

Leave granted.

The report read as follows—

SELECTION OF BILLS COMMITTEE

REPORT NO. 6 OF 2012

1. The committee met in private session on Monday, 18 June 2012 at 8.19 pm.

2. The committee resolved to recommend—That—

(a) the provisions of the Broadcasting Services Amendment (Improved Access to Television Services) Bill 2012 be referred immediately to the Environment and Communications Legislation Committee for inquiry and report by 25 June 2012;

(b) the Clean Energy Finance Corporation Bill 2012 be referred immediately to the Economics Legislation Committee for inquiry and report by 25 June 2012;

(c) the provisions of the Crimes Legislation Amendment (Slavery, Slavery-like Conditions and People Trafficking) Bill 2012 be referred immediately to the Legal and Constitutional Affairs Legislation Committee for inquiry and report by 13 September 2012;

(d) the provisions of the Fair Work (Registered Organisations) Amendment Bill 2012 be referred immediately to the Education, Employment and Workplace Relations Legislation Committee for inquiry and report by 25 June 2012;

(e) the provisions of the Privacy Amendment (Enhancing Privacy Protection) Bill 2012 be referred immediately to the Legal and Constitutional Affairs Legislation Committee for inquiry and report by 14 August 2012;

(f) the provisions of the Social Security Legislation Amendment (Fair Incentives to Work) Bill 2012 be referred immediately to the Education, Employment and Workplace Relations Legislation Committee for inquiry and report by 22 August 2012; and

(g) the provisions of the Tax Laws Amendment (Cross-Border Transfer Pricing) Bill (No. 1) 2012 be referred immediately to the Economics Legislation Committee for inquiry and report by 14 August 2012.

3. The committee resolved to recommend—That the following bills not be referred to committees:

Australian Citizenship Amendment (Defence Families) Bill 2012

Australian Human Rights Commission Amendment (National Children's Commissioner) Bill 2012

Broadcasting Services Amendment (Digital Television) Bill 2012

Clean Energy Legislation Amendment Bill 2012

Clean Energy (Customs Tariff Amendment) Bill 2012

Clean Energy (Excise Tariff Legislation Amendment) Bill 2012

Higher Education Support Amendment (Student Contribution Amounts and Other Measures) Bill 2012

Legislative Instruments Amendment (Sunsetting Measures) Bill 2012

Malabar Headland Protection Bill 2012

Marine Safety (Domestic Commercial Vessel) National Law Bill 2012 Marine Safety (Domestic Commercial Vessel) National Law (Consequential Amendments) Bill 2012

Migration (Visa Evidence) Charge Bill 2012

Migration (Visa Evidence) Charge (Consequential Amendments) Bill 2012

National Health Amendment (Pharmaceutical Benefits Scheme) Bill 2012

Navigation Bill 2012

Navigation (Consequential Amendments) Bill 2012

Parliamentary Counsel and Other Legislation Amendment Bill 2012

Passenger Movement Charge Amendment Bill 2012

Social Security and Other Legislation Amendment (2012 Budget and Other Measures) Bill 2012

Superannuation Legislation Amendment (Stronger Super) Bill 2012 Superannuation Supervisory Levy Imposition Amendment Bill 2012

Tax Laws Amendment (2012 Measures No. 2) Bill 2012

Income Tax (Managed Investment Trust Withholding Tax) Amendment Bill 2012

Pay As You Go Withholding Non-compliance Tax Bill 2012

Tax Laws Amendment (2012 Measures No. 3) Bill 2012

Income Tax (Seasonal Labour Mobility Program Withholding Tax) Bill 2012

Tax Laws Amendment (Income Tax Rates) Bill 2012

Tax Laws Amendment (Medicare Levy and Medicare Levy Surcharge) Bill 2012

Water Efficiency Labelling and Standards Amendment (Scheme Enhancements) Bill 2012

The committee considered the Corporations Amendment (Proxy Voting) Bill 2012 and, noting that the bill had passed the Senate on 18 June 2012, resolved to recommend that the bill not be referred to a committee.

The committee recommends accordingly.

4. The committee deferred consideration of the following bills to its next meeting:

Financial Framework Legislation Amendment Bill (No. 2) 2012

Greenhouse and Energy Minimum Standards Bill 2012

Greenhouse and Energy Minimum Standards (Registration Fees) Bill 2012

Maritime Powers Bill 2012

Maritime Powers (Consequential Amendments) Bill 2012

Protecting Children from Junk Food Advertising (Broadcasting and Telecommunications Amendment) Bill 2011

Special Broadcasting Service Amendment (Natural Program Breaks and Disruptive Advertising) Bill 2012.

(Anne McEwen)

Chair

19 June 2012

Appendix 1

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Broadcasting Services Amendment (Improved Access to Television) Bill 2012

Reasons for referral/principal issues for consideration:

The Bill amends the Broadcasting Services Act 1992 to introduce new legislative requirements, and increases some existing requirements for the provision of captioning services by commercial, national, and subscription television broadcasters.

The inquiry to examine:

The commercial and regulatory implications on broadcasters of making compliance with these captioning obligations a condition of a commercial television broadcasting license, a subscription television broadcasting licence, and a class licence.

Implications for free-to-air commercial networks in breach of the new licence condition if they are unable to provide a captioning service for reasons beyond their control, such as failure by a third party captioning provider to provide the service for reasons beyond the broadcasters control.

Implications for the long-term viability of services provided by subscription television, primarily international pass-through channels such as BBC World News, CNN, and Aljazeera.

Possible submissions or evidence from:

Free TV

ASTRA

Australian Broadcasting Corporation Special Broadcasting Service

Human Rights and Disability Groups

Committee to which bill is to be referred:

Senate Environment and Communications Committee

Possible hearing date(s):

To be determined by committee

Possible reporting date:

To be determined by committee

(signed)

Senator Fifield

Selection of Bill Committee member

Appendix 2

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Clean Energy Finance Corporation Bill 2012

Reasons for referral/principal issues for consideration:

To allow consideration of the legislation

Possible submissions or evidence from:

Committee to which bill is to be referred:

Economics Legislation Committee

Possible hearing date(s):

Possible reporting date:

25 June 2012

(signed)

Anne McEwen

Whip

Appendix 3

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Crimes Legislation Amendment (Slavery, Slavery-like Conditions and People Trafficking) Bill 2012

Reasons for referral/principal issues for consideration:

Whether the Bill adequate addresses the full range of circumstances and issues that it could

Whether victims are adequately supported

Possible submissions or evidence from:

Lawyers

Legal Aid commissions

AHRC

Migration Agents

Social services

Relevant government departments

Committee to which bill is to be referred:

Legal and Constitutional Affairs

Possible hearing date(s):

Late July or August

Possible reporting date:

13 Sept

(signed)

Senator Ludlam

Selection of Bill Committee member

Appendix 4

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

FAIR WORK (REGISTERED ORGANISATIONS) AMENDMENT BILL 2012

Reasons for referral/principal issues for consideration:

To ensure the Bill would achieve the objectives of the Bill and has no unintended consequences.

Possible submissions or evidence from:

Department of Education, Employment and Workplace Relations;

Relevant trade union organisations;

Relevant employer organisations;

Institute of Public Affairs;

Law Council of Australia; and

Any other relevant individuals with expertise in this area.

Committee to which bill is to be referred:

Senate Education, Employment and Workplace Relations Committee

Possible hearing date(s):

To be determined by committee

Possible reporting date:

To be determined by committee

(signed)

Senator Fifield

Selection of Bill Committee member

Appendix 5

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Privacy Amendment (Enhancing Privacy Protection) Bill 2012

Reasons for referral/principal issues for consideration:

Consideration of the adequacy of the proposed Australian Privacy Principles; Consideration of the efficacy of the proposed measures relating to credit reporting; Consideration of whether defences to contraventions should extend to inadvertent disclosures where systems incorporate appropriate protections; Consideration of whether provisions relating to use of depersonalised data are appropriate.

Possible submissions or evidence from:

Australian Retail Credit Association Australian Consumers Association Attorney-General's Department

Committee to which bill is to be referred:

Legal and Constitutional Affairs

Possible hearing date(s):

To be determined by committee

Possible reporting date:

(signed)

Senator Fifield

Selection of Bill Committee member

Appendix 6

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Social Security Legislation Amendment (Fair Incentives to Work)

Reasons for referral/principal issues for consideration:

Removal of the 'grandfathering' transitional arrangement from the parenting payment

Possible submissions or evidence from:

Civil society organisations and affected persons

Committee to which bill is to be referred:

Community Affairs Legislation Committee

Possible hearing date(s):

TBC

Possible reporting date:

22/8/12

(signed)

Senator Ludlam

Selection of Bill Committee member

Appendix 7

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Social Security Legislation Amendment (Fair Incentives to Work) Bill 2012

Reasons for referral/principal issues for consideration:

Consideration of lack of programme support within Employment Services for parents transitioning from Parenting Payment to Newstart Allowance, and the impact on families.

Possible submissions or evidence from:

Single parents lobby Job Services agencies

Committee to which bill is to be referred:

Education, Employment and Workplace Relations

Possible hearing date(s):

To be determined by committee

Possible reporting date:

To be determined by committee

(signed)

Senator Fifield

Selection of Bill Committee member

Appendix 8

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Tax Laws Amendment (Cross-Border Transfer Pricing) (No. 1)

Reasons for referral/principal issues for consideration:

Retrospective tax change

Rationale for retrospectivity

Quantum of revenue at risk

Consultation with treaty partners

Consultation with affected taxpayers

Possible submissions or evidence from:

Taxpayers (possibly impacted taxpayers: GE, Chevron, Power Corp, BHP Billiton, Rio Tinto, Ford, Holden)

Treasury

Committee to which bill is to be referred:

Senate Economics

Possible hearing date(s):

To be determined by committee

Possible reporting date:

To be determined by committee

(signed)

Senator Fifield

Selection of Bill Committee member

Senator McEWEN (South Australia—Government Whip in the Senate) (15:32): by leave—At the request of the Joint Standing Committee on the National Capital and External Territories, I move:

That the Joint Standing Committee on the National Capital and External Territories be authorised to hold a public meeting during the sitting of the Senate on Wednesday, 20 June 2012, from 12.30 pm to 1.45 pm, to take evidence for the committee's inquiry into the National Capital Authority annual report 2010-11.

Question agreed to.

Senator McEWEN (South Australia—Government Whip in the Senate) (15:33): At the request of Senator Bilyk, Chair of the Joint Selection Committee on Cyber-Safety, I move:

That the Joint Select Committee on Cyber Safety be authorised to hold a public meeting during the sitting of the Senate on Wednesday, 27 June 2012, from 4.15 pm to 5.30 pm.

Question agreed to.

Senator McEWEN (South Australia—Government Whip in the Senate) (15:33): At the request of Senator Moore, Deputy Chair of the Community Affaqirs References Committee, I move:

That the time for the presentation of the report of the Community Affairs References Committee on health services and medical professionals in rural areas be extended to 15 August 2012.

Question agreed to.

Senator McEWEN (South Australia—Government Whip in the Senate) (15:33): At the request of Senator Singh, I move:

That the Joint Standing Committee on Migration be authorised to hold a public meeting during the sitting of the Senate on Wednesday, 27 June 2012, from 10.30 am to 12.30 pm.

Question agreed to.

Senator McEWEN (South Australia—Government Whip in the Senate) (15:33): At the request of Senator Crossin, Chair of the Legal and Constitutional Affairs Legislation Committee, I move:

That the Legal and Constitutional Affairs Legislation Committee be authorised to hold a private meeting otherwise than in accordance with standing order 33(1) during the sitting of the Senate on Thursday, 21 June 2012, from 3.45 pm.

Question agreed to.

Senator KROGER (Victoria—Chief Opposition Whip in the Senate) (15:34): At the request of Senator Birmingham, Deputy Chair of the Joint Standing Committee on Treaties, I move:

That the Joint Standing Committee on Treaties be authorised to hold a private meeting otherwise than in accordance with standing order 33(1) during the sitting of the Senate on Tuesday, 19 June 2012, from 8.15 pm to 9.30 pm.

Question agreed to.

Senator KROGER (Victoria—Chief Opposition Whip in the Senate) (15:34): At the request of Senator Birmingham, Deputy Chair of the Joint Standing Committee on Treaties, I move:

That the Joint Standing Committee on Treaties be authorised to hold a public meeting during the sitting of the Senate on Monday, 25 June 2012, from 10 am to noon.

Question agreed to.

Senator KROGER (Victoria—Chief Opposition Whip in the Senate) (15:34): At the request of Senator Cash, Deputy Chair of the Parliamentary Joint Committee on the Australian Commission for Law Enforcement Integrity, I move:

That the Parliamentary Joint Committee on the Australian Commission for Law Enforcement Integrity be authorised to hold a private meeting otherwise than in accordance with standing order 33(1) during the sitting of the Senate on Thursday, 21 June 2012, from 11 am.

Question agreed to.

Senator WRIGHT (South Australia) (15:34): I move:

That the time for the presentation of the report of the Legal and Constitutional Affairs References Committee on the detention of minors be extended to 19 September 2012.

Question agreed to.

Senator HANSON-YOUNG (South Australia) (15:34): I move:

That there be laid on the table no later than 28 June 2012 by the Minister representing the Minister for Sustainability, Environment, Water, Population and Communities, the following:

   (a)   any draft or final legal advice regarding the Murray Darling Basin Draft Plan obtained by the department;

   (b)   any legal advice regarding the Murray Darling Basin Draft Plan obtained by another party and provided to the department;

   (c)   any draft or final legal advice that comments on whether the Murray Darling Basin Draft Plan is consistent with the Water Act 2007;

   (d)   any draft or final legal advice that comments on the constitutionality of the Murray Darling Basin Draft Plan; and

   (e)   any draft or final legal advice that comments on the prospects of a legal challenge of the Murray Darling Basin Draft Plan by an Australian state or territory.

Question agreed to.

Senator FAULKNER (New South Wales) (15:38): On behalf of the Parliamentary Joint Committee on Intelligence and Security, I present the report of the committee, Review of administration and expenditure: No. 9: Australian intelligence agencies. I seek leave to move a motion in relation to the report.

Leave granted.

Senator FAULKNER: I move:

That the Senate take note of the report.

The oversight of the Parliamentary Joint Committee on Intelligence and Security of the Australian Intelligence Community is a very important responsibility of the committee, as senators would be aware, so I am very pleased to present this ninth review of the administration and expenditure of the AIC by the Parliamentary Joint Committee on Intelligence and Security.

The review examined a wide range of aspects of the administration and expenditure of the six intelligence and security agencies, including the financial statements for each agency and their human resource management, training, recruitment and accommodation. In addition, the review looked at issues of interoperability between members of the AIC.

Submissions were sought from each of the six intelligence and security agencies, from the Australian National Audit Office and from the Inspector General of Intelligence and Security. The submissions from ANAO and the six intelligence agencies were all classified confidential, restricted or secret and therefore have not made available to the public. As has been its practice for previous reviews, ASIO provided the committee with both a classified and an unclassified submission. The unclassified version is available on the committee's website.

Each of the Defence intelligence agencies provided the committee with a classified submission. The agencies marked each paragraph with its relevant national security classification. This has enabled the committee, for its 2009-10 review, to directly refer in this report to unclassified information provided in the Defence agencies submissions. The Committee also received five submissions from members of the public or public organisations, including the Asylum Seeker Resource Centre, the Brigidine Asylum Seekers Project, RISE and the Refugee Council of Australia. These submissions all dealt with ASIO's security assessments of refugees.

On 25 March last year, the committee held a private hearing at which ASIO, ASIS, DSD, DIGO, ONA and DIO all appeared before the committee. On 16 June 2011, the committee held a public hearing—the first, in fact, since 2006—and heard from representatives of the Refugee Council of Australia, Refugees, Survivors and Ex-Detainees, the Asylum Seeker Resource Centre and ASIO in relation to visa security assessments. The committee thanks all attendees, particularly those from organisations providing support to refugees, for the time and effort they took to put their views to our committee.

Given the public interest and importance of the issue of visa security assessments in the report I have tabled, I should say the committee certainly notes the request by some advocacy groups for ASIO to declare its non-statutory criteria for making visa security assessments. The committee believes that making non-statutory criteria publicly available could compromise national security because applications from potentially hostile individuals could be tailored to meet those criteria. Therefore, the committee has not supported that suggestion.

The committee notes that since its previous administration and expenditure inquiry ASIO's visa security assessment workload has increased significantly. Procedures and processes for undertaking visa security assessments have been placed under considerable strain and, I must say, in some cases assessments have taken longer than is desirable.

The committee takes very seriously the concerns put before it by various refugee and asylum-seeker advocacy groups, but it also recognises the difficulties that ASIO has in fulfilling its responsibilities in this area. Therefore, the committee welcomes the efforts, introduced by ASIO on 1 March 2011, to streamline the process of security assessments in an attempt to clear the backlog and to process future assessments in less time. The committee is satisfied that the current regime for visa security assessments is the correct one. The committee notes that the Inspector-General of Intelligence and Security has stated that ASIO is doing its job in a 'proper and legal manner'.

Overall, the committee is satisfied that the administration and expenditure of the six intelligence and security agencies is sound. However, I would note that concerns raised in relation to the efficiency dividend's impact on agencies during the committee's Review of administrationand expenditure:Australian intelligence organisations, No. 8 were specifically raised in the evidence the committee took for the current review. This is extremely concerning to the committee. The committee will continue to monitor the impact of the efficiency dividend on the Australian intelligence community. The committee was pleased with the level of information given to it in relation to interoperability and it will continue to monitor this area to ensure that interoperability management and budgetary structures are in place across the Australian intelligence community. As always, the committee thanks the heads of the AIC agencies and all those who contributed to this review. I commend the report to the Senate.

Senator RHIANNON (New South Wales) (15:47): I listened with interest to Senator Faulkner's comments on this, because the impact of nearly a decade of counter-terrorism measures clearly is very relevant to Australia as it has had a considerable impact on the lives and liberties of Australians. The review of administration and expenditure undertaken by the Parliamentary Joint Committee on Intelligence and Security is very relevant to any consideration.

It is also relevant to note that the budget, on page 32, covers various deliverables under the heading, 'Implementation of relevant recommendations of the 2011 Independent Review of the Intelligence Community'. However, the report from the independent review of intelligence matters was heavily redacted and no recommendations were made public. This is one of the problems that we have in getting a full handle on the issues raised with respect to the report that has just been tabled, as it is still not fully clear to the public how all these agencies work together. With regard to the report from the independent review, for instance, it has sat on the Prime Minister's desk for six months. You would have to say it really is lacking in substance, as no recommendations were made public. Therefore when we come to this review of administration and expenditure, the obvious questions are: how do all these reviews fit together? How do they build on each other? Are they just going through the motions of apparently reporting, or is there a real attempt to make an assessment that can provide meaningful information to make an assessment of how we ensure our security is what Australia needs in 2012 and the years ahead? How do we learn the lessons of the last decade?

The threat status in Australia, from the information that is available, has remained about the same since the September 2001 attacks. Australians therefore have the right to know why there has been such a massive increase in funds for intelligence agencies and what these multimillion-dollar budgets are being spent on. But the reports coming out in this area certainly do not clarify that matter and that all-important question remains unanswered. The current report also fails on that score. The independent review of the intelligence community also failed to do this. Time and time again we see a failure to fulfil the objectives under which people expect these inquiries to operate.

It is also worth noting the comments of Mr Philip Flood, who headed the 2004 Flood inquiry. He said:

… Australians are entitled to expect that intelligence collection agencies are properly scrutinised and held to account.

That is where, when you look at these various reports, you would have to conclude that we continue to fail. The heads of agencies operate with minimal accountability, and there is the worrying possibility that they and their staff may at times operate outside the law. We have seen that in various specific examples and, because these reviews are so scanty, it is very hard to make that assessment. It is also relevant to note one of the studies by Civil Liberties Australia. They estimate that about 25 per cent of ASIO data collected on Civil Liberties Australia members, and released under the 30-year rule, was in error. That helps give some indication of the problems that you would have to anticipate in reading these reports.

It is also worth noting some of the information the Australian Human Rights Commission have provided. They have previously raised their concerns about the conduct of ASIO security assessments for people in immigration detention who arrived in Australia without authorisation. So I do note the comments of the previous speaker, Senator Faulkner, where he talked about the increased load that some departments now have because of increasing numbers of people coming to Australia. However, there also continue to be problems about how many of those agencies carry out their work. I note that the Australian Human Rights Commission has found that there are significant delays in finalising ASIO security assessments for a large number of people in immigration detention. The level of resources allocated for the conduct of security assessments is something that has been questioned, and the working relationship between ASIO and the Department of Immigration and Citizenship is something that has also been raised as a concern.

While the Greens welcome the release of this report, as with other reports it shows up many questions about how these agencies are working and to what degree intelligence and security are being managed in this country in a way that ensures that Australians are indeed secure, but secure in a way that protects human rights. We can most definitely get the balance right if attention is paid to that in a constructive way between these agencies and government.

Question agreed to.

Senator KROGER (Victoria—Chief Opposition Whip in the Senate) (15:53): On behalf of Senator Cash and the Joint Standing Committee on Migration, I present the report of the committee on the Migration (Visa Evidence) Charge Bill 2012 and a related bill.

Senator KROGER: by leave—I move:

That the Senate take note of the report.

I seek leave to have a statement incorporated in Hansard.

Leave granted.

The statement read as follows—

It gives me pleasure today on behalf of the Joint Standing Committee on Migration to present the Committee's advisory report on the Migration (Visa Evidence) Charge Bill 2012 and the Migration Visa Evidence Charge (Consequential Amendments) Bill 2012.

These bills, were referred to the Migration Committee by the House of Representatives Selection Committee on the 10th of May.

The bills will introduce a charge for the issuing of hardcopy evidence that a visa is held by a non-citizen visa holder.

Evidence in hardcopy form that such a person holds a visa is usually provided as a visa label or as an imprint placed in the visa holder's passport. Currently Australia does not charge a fee for issuing these visa labels and the Department of Immigration and Citizenship provided over one million labels or imprints during 2011.

Despite the issue of these labels, the government actually relies on an electronic visa entitlement verification system, called VEVO, to validate a person's visa status and entitlements online. VEVO is also accessible to registered organisations which may need to verify a person's visa status as well as to visa holders themselves.

According to the department, two-thirds of its current visa caseload is processed electronically. Yet, 90 per cent of clients at migration counters still request hard copy evidence of their visa even though it is not necessary.

Currently, visa holders are entitled under the Migration Act to hard copy evidence of their visa status. These bills will amend the Migration Act to introduce a charge for the issue of hard copy evidence—on the basis that the electronic visa evidence accessible through VEVO makes the need for hard copy evidence redundant.

The charge is to discourage people requesting the hard copy evidence. The maximum charge limit will be $250, although the department has indicated that the actual amount charged will be much less. There will be different scales of charges, exemptions to the charges and nil fees for certain visa classes. The department estimates that the charge will recover some $90 million over the three years following implementation.

The Selection Committee and members of the Migration Committee questioned the scale of the charges, the projected revenue to be raised and whether the electronic VEVO system really does replace the need for hard copy evidence of visas.

The committee conducted its inquiry by issuing questions on notice to the Department of Immigration and Citizenship. The list of questions asked is contained in the appendix to the committee's report.

The committee was satisfied overall with the department's responses. The committee accepts that the main justification for introducing the fees is to encourage visa holders and registered organisations to accept electronic verification alone. This is part of a global transition towards visa label free travel and electronic confirmation of visas.

The committee has recommended that the legislation be passed. However, the committee does believe that the associated explanatory memoranda should be more comprehensive. Accordingly, we have recommended that the explanatory memoranda be expanded and re-tabled.

The Chair, the Member for Calwell in the other place, thanks all on the committee for their work on this inquiry. I commend the report to the Senate.

Question agreed to.

Senator JACINTA COLLINS (Victoria—Manager of Government Business in the Senate and Parliamentary Secretary for School Education and Workplace Relations) (15:55): I move:

That this bill may proceed without formalities and be now read a first time.

Question agreed to.

Bill read a first time.

Senator JACINTA COLLINS (Victoria—Manager of Government Business in the Senate and Parliamentary Secretary for School Education and Workplace Relations) (15:56): I move:

That this bill be now read a second time.

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

Leave granted.

The speech read as follows—

EQUAL OPPORTUNITY FOR WOMEN IN THE WORKPLACE AMENDMENT BILL 2012

This bill amends the Equal Opportunity for Women in the Workplace Act 1999.

Gender inequality is a significant disincentive to women's workforce participation.

Improving women's workforce participation is central to improving productivity and addressing current and future skills shortages.

This package of reforms delivers on the government's 2010 election commitment to retain and improve the Equal Opportunity for Women in the Workplace Agency and the Equal Opportunity for Women in the Workplace Act.

It is a significant reform to support and help drive improved gender equality outcomes in Australian workplaces.

It is an important component of the government's workforce participation and human rights agenda.

We said we would reform the act to support gender equality and improve workforce participation and workplace flexibility—and that is what we are doing.

This bill will improve gender equality outcomes as well as simplifying reporting for businesses.

It will assist in striking the right balance between the need to drive and encourage change within business, without increasing the regulatory burden.

This legislation follows a review of the act by the Office of Women in the Department of Families, Housing, Community Services and Indigenous Affairs.

The review found that since the act was last amended in 1999, there had been a number of economic, social and legislative changes, making it important for the act and the agency to provide a contemporary response to national challenges.

The review made it clear that gender equality is essential to maximising Australia's productive potential and to ensuring continued economic growth.

It has been estimated that closing the gap between men's and women's workforce participation could boost gross domestic product by 13 per cent.

The bill changes the name of the act to the Workplace Gender Equality Act 2012 to emphasise the focus of the act on gender equality in the workplace.

The name of the Agency is changed from the Equal Opportunity for Women in the Workplace Agency to the Workplace Gender Equality Agency.

The title of the director of the agency is also changed to the Director of Workplace Gender Equality.

The principal objects of the act are amended by the bill to reflect the focus on gender equality in the workplace. They are:

to promote and improve gender equality (including equal remuneration between women and men) in employment and in the workplace;

to support employers to remove barriers to the full and equal participation of women in the workforce, in recognition of the disadvantaged position of women in relation to employment matters;

to promote, among employers, the elimination of discrimination on the basis of gender in relation to employment matters (including in relation to family and caring responsibilities);

to foster workplace consultation between employers and employees on issues concerning gender equality in employment and in the workplace; and

to improve the productivity and competitiveness of Australian business through the advancement of gender equality in employment and in the workplace.

The coverage of the act is expanded to include men, as well as women, particularly in relation to caring responsibilities.

The new legislation will mean that for the reporting period commencing 1 April 2013, a relevant employer must prepare and lodge a public report containing information relating to gender equality indicators.

Smaller organisations with fewer than 100 employees will not be required to report, but they will be able to access the agency's advice, education and incentive activities.

The proposed outcomes-based reporting will streamline and simplify reporting.

This will deliver certainty to organisations in what they are required to report on and provide an invaluable means of measuring progress over time.

Organisations will be able to measure their performance against other similar organisations.

This change will represent the first time the agency will be able to gather and analyse a rigorous and standardised data set.

We will know exactly what is happening, and where, in Australian workplaces regarding gender equality practices and outcomes.

Businesses will now be able to complete and submit reports online using a secure web-portal. Businesses have wanted this change and it will save them time and money.

The gender equality indicators are set out in the act and include reporting on equal remuneration for men and women.

Equal remuneration is explicitly referred to in the objects of the act. Organisations will be required to report on pay data. Salary data will be removed from the public reports.

More standardised data will provide insight as to where gender pay gaps are emerging or growing at the industry or sector level.

With the gender pay gap in Australia sitting at just under 18 per cent, this focus on equal remuneration is particularly important.

Over time, the legislation will enable the agency to develop benchmarks. This will allow employers to consider their performance compared to others in their industries.

The legislation will also enable the minister to set industry specific minimum standards, in consultation with industry and experts. These minimum standards will have to be determined before 1 April 2014.

Minimum standards will be used for the identification of those organisations that are struggling and the targeting of advice and assistance.

The new bill will also allow for more transparency in reporting.

It will be a requirement that public reports be signed by the chief executive officer of the relevant employer. This will help to ensure that management at the highest level engages in the issue of gender equality.

A relevant employer must inform employees and shareholders that the report has been lodged and employees and employee organisations will then be provided with the opportunity to comment on the report.

The bill also improves the transparency and fairness of the compliance framework and consequences for non-compliance.

Checks on the compliance of a relevant employer may be undertaken and may, by written notice, require a relevant employer to provide information that is relevant to the employer's compliance with the act.

Consequences for non-compliance, without reasonable excuse, include naming the employer in a report to the minister or naming the employer by other means.

There are also possible consequences in relation to Commonwealth procurement, grants and financial assistance.

This new legislation puts gender equality in the workplace firmly under the spotlight.

This is an important reform aimed at the genuine and sustained removal of barriers to women's full and equal participation in the workforce.

The government is determined to improve women's economic security—and this begins with fair and equitable treatment in the workplace.

This is a sophisticated and meaningful package of reforms—a significant step forward in enabling employers and government to measure and drive better outcomes for women and men in Australian workplaces.

Debate adjourned.

Senator JACINTA COLLINS (Victoria—Manager of Government Business in the Senate and Parliamentary Secretary for School Education and Workplace Relations) (15:56): I move:

That these bills may proceed without formalities, may be taken together and be now read a first time.

Question agreed to.

Bills read a first time.

Senator JACINTA COLLINS (Victoria—Manager of Government Business in the Senate and Parliamentary Secretary for School Education and Workplace Relations) (15:57): I move:

That these bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

Leave granted.

The speeches read as follows—

SUPERANNUATION LEGISLATION AMENDMENT (STRONGER SUPER) BILL 2012

This bill introduces a framework to support the implementation of superannuation data and payment standards that will apply to specified superannuation transactions undertaken by superannuation entities and employers.

These amendments are part of the SuperStream package of measures designed to enhance the ‘back office’ of superannuation. The Superannuation industry is currently dominated by paper based transactions that are inefficient in both processing costs and the time taken for transactions to occur and superannuation to be deposited into member accounts.

Both members and employers will benefit from the changes. For example, fund members will benefit from being able to easily manage their superannuation accounts, have low value inactive accounts consolidated automatically, and easily check if their superannuation contributions have been paid.

Employers will benefit from having standardised simplified administrative processes when dealing with superannuation funds. Conversely, superannuation funds will benefit from standardised simplified administrative processes when dealing with employers and other funds.

It is estimated that the SuperStream proposals could save the industry up to $1 billion per year. Much of the benefit of these savings should flow through to members in the form of lower fees and charges.

The standards will be mandated for superannuation entities (including Approved Deposit Funds), Retirement Savings Account providers and for employers.

A new penalty framework is also introduced to ensure trustees of superannuation entities, RSA providers and employers comply with the standards.

This bill also enables the Commonwealth to collect the costs associated with the implementation of the SuperStream measures and enables the minister to make a determination that specifies the proportion of levy money paid to Australian Prudential Regulation Authority (APRA) that is to be credited to the APRA Special Account.

The cost of implementing the SuperStream reforms is $467 million in total over seven years to be paid for by a temporary SuperStream levy on APRA-regulated funds. If you averaged the full levy increase of $121 million to apply in 2012-13 across the approximate 33 million accounts existing today, the cost is roughly in the order of $4 per account.

Estimates undertaken by the superannuation industry have identified that SuperStream will save in the order of $1 billion each year in processing costs. Averaged over the approximate 33 million accounts existing today, this saving is in the order of $30 per account each year.

This is a significant saving for each and every member of a superannuation fund.

The coalition has acknowledged that the SuperStream measures have the potential to deliver real savings that will benefit superannuants and they support changes that make the superannuation system more efficient, transparent and competitive.

Full details of the measures in this bill are contained in the explanatory memorandum.

SUPERANNUATION SUPERVISORY LEVY IMPOSITION AMENDMENT BILL 2012

This bill provides the Treasurer with the ability to make a subsequent determination of the amount of the Superannuation Supervisory levy to be paid, for a financial year.

The Superannuation Supervisory levy will pay for implementation costs to improve the administration and management of super accounts making the processing of everyday transactions easier, cheaper and faster for both members and employers.

It is part of the 'SuperStream' package of measures designed to enhance the 'back office' processing of superannuation.

Key measures include the introduction of data and payment standards and consolidation of accounts.

Estimates undertaken by the superannuation industry have identified that SuperStream will save in the order of $1 billion each year in processing costs. Averaged over the approximate 33 million accounts existing today, this saving is in the order of $30 per account each year.

The cost of implementing the SuperStream reforms is $467 million in total over seven years to be paid for by a temporary SuperStream levy on APRA-regulated funds. If you averaged the full levy increase of $121 million to apply in 2012-13 across the approximate 33 million accounts existing today, the cost is roughly in the order of $4 per account.

This bill will provide the Treasurer increased flexibility in determining the maximum restricted and unrestricted levy amounts, the restricted and unrestricted levy percentages and the superannuation entity levy base to be used in finalising the levy amount.

Full details of the measure in this bill are contained in the explanatory memorandum.

Debate adjourned.

Senator McEWEN (South Australia—Government Whip in the Senate) (15:58): On behalf of the Chair of the Legal and Constitutional Affairs Legislation Committee, Senator Crossin, I present the report of the committee on the provisions of the Migration Legislation Amendment (Student Visas) Bill 2012, together with the Hansard record of proceedings and documents presented to the committee.

Ordered that the report be printed.

Senator McEWEN (South Australia—Government Whip in the Senate) (15:58): I also present a report from the Legal and Constitutional Affairs Legislation Committee on time-critical legislation relating to the Passenger Movement Charge Amendment Bill 2012.

Ordered that the report be printed.

Senator DI NATALE (Victoria) (15:59): I am pleased to be able to rise today to continue my remarks on the Personally Controlled Electronic Health Records Bill 2011 and the Personally Controlled Electronic Health Records Bill (Consequential Amendments) Bill 2011. It is legislation that advances Australia down the road towards a much more modern, efficient and better connected health system. We know in this day and age, with the use of technology, that most Australians are familiar with communication technology. Kids and grandparents are all thoroughly familiar with the world of instant connectivity. My young 3½-year-old knows his way around an iPhone. Not my grandmother, but many grandmothers are now using the internet as part of their daily lives. It has become a part of the world we live in.

I think that people would be shocked at how technologically naive and how technologically primitive our health system is when we compare the role that technologies play in our daily lives. It would be natural to assume when you move between a GP, a specialist, your hospital, allied health professionals and so on that the health information collected in each of those places follows you around electronically. But I have to say that nothing could be further from the truth. If the information does follow you, it often goes in the post. It might sit on a fax machine somewhere or it might gather dust in medical archives. If you do get your hands on it, it is often incomplete and occasionally it is completely illegible.

In a former life, I have spent time as a medical professional and spent countless hours with some of my colleagues and other professionals trying to decipher notes from other medical colleagues. I do not have the best handwriting in the world, but some of my colleagues' handwriting more closely resembles Egyptian hieroglyphics than it does English. I have spent time contacting medical record departments and other doctors simply because I could not get access to up-to-date information, or the information was completely indecipherable. So it is important that we make change in this area.

There is also the situation where someone might present with a history of acute pain. I have been in that situation, where people present with acute pain and request analgesia, often opiate analgesia. One of the problems is that you cannot be sure whether the history is genuine or whether it is in fact somebody who is seeking opiates because they have a problem with dependence. It is a phenomenon known as 'doctor shopping'. For decades we have been talking about resolving this issue and getting up-to-date PBS information so that healthcare professionals can make these sorts of decisions with confidence. The electronic health record has the potential to realise that huge area where we can make those clinical decisions with confidence.

In short, the system we have in this country of health technology communication results in two enormous problems. It results in major inefficiencies within the health system, which of course impose an enormous cost. More importantly, it results in serious medical errors, some of which are life threatening and occasionally fatal. Every single day, because of inadequate information, people will get medication that they are allergic to and they will get drugs that interact negatively with other drugs that they are taking, causing major side effects. Tests will sometimes be ordered that are completely unnecessary because they have been done recently. With the full information at hand, the test would not have been ordered in the first place. Sometimes you will see a patient who has just had treatment from another healthcare professional or from hospital, and that information will make a huge difference in terms of the clinical decisions you make as a healthcare professional.

The savings estimated to be realised from the e-health implementation amount to about $11½ billion by 2025. That, I think, is a fairly conservative estimate. I have seen some people suggest that the figure may in fact be much, much higher, when you consider the duplication that occurs in medication, pathology and so on and savings in terms of primary care visits and a range of other potential benefits. As I said, cost is not the main reason that we need to take action in this area. The health system as it stands, because of the inadequate communication, results in damage to the health and wellbeing of Australian patients every day. Nearly 200,000 people are admitted to hospital every year because of medication errors. Many of those are avoidable and would have been avoided if we had access to up-to-date information. Lives are lost on a daily basis because of these sorts of errors, and it has to change. If you are wheeled into an emergency department, you want to know that the doctors treating you have access to all of the available information that will result in the best course of care for you. These issues are often a matter of life and death.

Times have changed. We have the technical know-how to fix this problem. We should see it in the same way as we see other health technologies. We accept that we would not deny cost-effective, life-saving medical technology in any other area of health care and we should not deny it in communication technologies either.

This legislation puts in place a crucial framework for e-health reform. In principle, the move towards e-health and the creation of the personally controlled electronic health record is not controversial. In fact, we heard recently that the coalition support the bill. I look forward to hearing from them about their comprehensive plan for e-health. It is very, very easy in this place to criticise; it is easy and it is cheap. What is more difficult is to be constructive and to provide solutions. So I am looking forward to hearing about the opposition's comprehensive plan for e-health.

The benefits that flow from the better use of communications technology in health care are obvious. As I said, they are potentially life saving. Everybody agrees that we need to make progress. While the government, doctors, consumer groups and even the opposition are in agreement on the principle of e-health, as with most reforms, the devil will be in the detail. The personally controlled electronic health record is the centrepiece of Australia's e-health agenda. Conceptually it is the central point of health information for every Australian. It brings together health information such as the medications that people take, the visits they have had to healthcare professionals—GPs and other allied health professionals—what was done at those visits, hospital information and important discharge information. All of this will be brought into the one place so that health professionals can monitor and update it. Once the system is operating, people will have confidence in it, knowing that their doctor, surgeon, allied health professional and so on are all coordinating their care and that they have the most up-to-date, most relevant information available. They will know what tests have been done recently, what pills people are taking and whether people have filled their scripts, and that is important because often a doctor issues a script but does not know whether in fact the script has been filled. That may be because you cannot afford it or because you are having a side effect and have been reluctant to tell your GP. All of those things are potential advantages through e-health. We will be able to see X-rays and other scans that have been done and monitor them against each other over time. That is important because small changes can mark important pathologies. It is going to be a comprehensive change.

Most importantly, it is a personally controlled record. It is not mandatory; individuals have the opportunity to decide for themselves whether they wish to take part. I am very confident that, over time, as the benefits become clear, more and more people will take up an electronic record and we will have a better health system as a result. People will have control over who can see their record. We know that personal details are private and must remain so, and I am confident that the provisions are in place to ensure that that happens.

It is a transformative technology as well. It has the potential to empower individuals in a way that often modern medicine does not. One of the criticisms of modern medicine is that it is a disempowering process. You hand over almost total control, in some instances, to the healthcare professional who is monitoring and treating your condition, but in this case individuals have the information at hand. They can access that information as they need to and they can become more informed, and they have an opportunity to have an interaction with their healthcare professional, which does not exist at the moment.

The details of access are controlled, such as that the defaults are left to the system operator to determine, and that is important, because I assume that most people will use the default access controls. I am pleased that the government has acknowledged just how important this is, that consultation will be a critical part of this process and that they will suggest amendments to this effect. If all goes well, millions of Australians will be entrusting the system with their most personal details. It could not be more crucial that consumers have faith that their privacy will be respected.

We hope that individuals will make an informed choice and get together with their nominated provider, which in most cases will be a GP, but not always, and that they will go through the steps to create and populate their health record in a shared health summary. They will be told how to control the information and who can see it. Of course, the more information you share the better the clinical decisions are likely to be, but it is always balanced against the patient's right to privacy, so we have to give clear advice to people that they must decide the most appropriate way to implement these sorts of decisions.

Shortly, Australians will be able to sign up for the patient-controlled electronic health record directly online, through Medicare, their GP or their nominated provider. They will prepare a shared health summary so that other clinicians can see at a glance the information they need to know about an individual's health. It is important to know that individuals will have control over what goes on the record and that they will be able to decide who gets to see it. You will be able to access the record online and make your own notes. At all times, control of the electronic health record is in the hands of the individual. If you do not want to participate, the choice remains yours.

Of course, there are some issues. I know that it is going to be some time before the health information systems used within doctors' surgeries are integrated with the PCEHR. Following that, hopefully we will see hospitals, radiologists, pathologists, pharmacists and so on included so that we get a much more integrated system. I for one would have liked to have seen this happen a little earlier. Obviously, since 1 July is the deadline, it would have been nice if the whole shebang were ready to go. It is not. It will be, as we have heard, a 'soft launch'. In fact, it is becoming softer by the day, but that is not of great concern to us. Ultimately a system that starts small and improves with frequent iterations is probably more likely to be successful.

It do not know of too many IT projects that go smoothly. I think that IT projects are a bit like construction projects. There are often unforeseen hiccups, so I think it will be most likely that we will need to iron out some bugs through this process. While the profession, the industry and other stakeholders continue work on these, I think it gives an opportunity for consumers to become accustomed to the idea of the electronic health record.

We do have some concerns with this legislation. As I said, the privacy controls are not fully specified by the bill but are to be developed by the system operator. We wanted to ensure that consultation around the default access controls would be conducted, and we are pleased that this will now happen. The record will also serve as an enormous repository of medical data, so, if there were a way the data could be used for research purposes that protects privacy and anonymity but also provides the opportunity to improve our health system and get valuable information, then I think we should go for it. I am really pleased that this is happening at a time when the Association of Australian Medical Research Institutes is currently looking very keenly at the McKeon review. One of the purposes of that review is to look at how we can improve integration between medical research and the health system.

The key roles of medical research as outlined by the Association of Australian Medical Research Institutes is to reduce the burden of disease by improving our understanding of the drivers of health—risky behaviours and so on—to improve the quality of health services, to improve the efficiency of health service delivery and so on. Medical research in this country plays a huge role—in fact, we are world leaders in that area—and the patient-controlled electronic health record has an opportunity to allow that to continue to grow and develop. We have heard some other concerns about the electronic health record. Some in the industry have been critical of the NEHTA, the National E-Health Transition Authority. We have heard criticisms of its governance structure and criticism of its approach to consultation. We have heard from industry stakeholders who feel that the development of technical specifications was poorly handled. We are aware of that. We have also heard that there were concerns around the governance of the PCEHR. We agree that there is the potential for a conflict of interest when the functions of the system operator are invested in the secretary of the department. It is an issue of accountability and we are sympathetic to suggestions that the system operator should exist independently. We are pleased that there will be a review after two years. As we have said, the devil is in the detail, so we will be watching very closely over the next two years.

I am also aware of some of the reservations that my former profession has around the issue of the liability of doctors who use the electronic record. Will they need to read the entire file of every patient at each consultation? If they do not, will they be held liable if there is a problem? There are some issues to resolve, but I am confident that the government, the medical establishment and other stakeholders will be able to work together to solve this dilemma.

The PCEHR also puts in place strict controls about who can see a record. It records who had access and when. We value the fact that consumers want their privacy to be respected, but that comes at a cost. The cost in this case is complexity. A small medical practice might have a single computer—one or two workstations—which makes this level of access control problematic. That is another issue that needs to be tackled.

There are bound to be delays, probably some mistakes, complaints and poor process encountered along the way. It is a big and expensive project with a lot of moving parts. It was not until we looked at this issue more closely that we began to get an appreciation of just how difficult and complex this issue is, but we do need to get it underway. We know that it is critical.

Modern medicine has made remarkable progress in a number of areas. We have had huge advances in medical technology. Life expectancy has increased, in part because of those advances. We have remarkable things, things that were previously the stuff of science fiction. Endoscopy, nuclear medicine, advances in genetics and so on are mainstream technologies today and they help us with the diagnosis and treatment of potentially fatal diseases. But there remains a glaring hole in the health system—that is, that in a 21st century health system we have what I consider to be in some instances 19th century communications practices. This bill provides the framework for improving that situation, for righting that wrong, and it is for those reasons that the Greens commend it to the Senate.

Senator URQUHART (Tasmania) (16:18): I rise to speak on the Personally Controlled Electronic Health Records Bill 2011. E-health is an integral part of the Australian government's agenda for health reform, an agenda that aims to create a continuously improving healthcare system for the 21st century, a system that is accountable, affordable and sustainable, with safety and quality at its centre.

The personally controlled e-health system is the next step in using e-health to enhance the health care system. This key infrastructure reform is of vital importance to the way in which our health professionals will provide their services in Australia in the future. It creates the capacity for a patient's shared health record to be available securely over the internet where and when it is needed at the point of care. The first release will deliver the core functionality required to establish a system that can grow over time. It will benefit both patients and providers through a secure opt-in system. A patient or their nominated representative will be able to register for an e-health record and control access to that record. Individuals can choose whether or not to have the personally controlled e-health record. If they choose to participate, they will be able to set their own access controls or allow default access settings to apply. With the individual's permission, key pieces of health information may be reviewed by participating healthcare providers across different locations and healthcare settings. This will remove the paper trail between health professionals, removing the need for pharmacists to squint when trying to make out the doctors' handwriting, as Senator Di Natale mentioned, importantly ensuring that the correct information is transferred between health providers. It will limit the need for patients to have to retell their story if they need to see a different specialist or GP, taking some of the burden out of seeing a new doctor. It will create synergies between a community mental health nurse who has assessed a patient at their home and the psychiatric unit of the local hospital.

It is a pleasure to be speaking to these bills only a few days after the Minister for Health, Tanya Plibersek, together with my federal Labor colleagues and I, announced a $325 million assistance package for the Tasmanian health system. A key aspect of this assistance package is to build on the tremendous work of the north-western health professionals and provide resources to speed up the rollout of e-health records to patients across the whole of Tasmania. A great example of how e-health can assist in isolated communities with limited health resources is evident in Smithton in the far north-west of Tasmania. Smithton is a small community of approximately 3,500 people that is serviced by a four-doctor general practice. The same GPs provide services at the local aged-care facility, Emmerton Park, and also at the local community hospital, which is located adjacent to Emmerton Park. As it is a small community, the majority of the residents of Emmerton Park and patients presenting to the community hospital are also patients of the local general practice.

Before the NBN connected the hospital, Emmerton Park and the general practice, doctors had not been able to access their existing patient notes when visiting Emmerton Park and the hospital because of variable and slow broadband, which meant that full patient histories, including test results, had not previously been available to them. This has provided the opportunity to implement technology using the NBN which will allow GPs to access their practice notes at both Emmerton Park and the community hospital, and print prescriptions on-site if required. The solution involves implementation of iPad 2 technology at Emmerton Park and the community hospital with virtual private network software to enable a quick remote connection to the practice system via the NBN. A wireless printer on-site will enable the printing of prescriptions, which the doctor can sign while in attendance. The iPad 2 technology will be duplicated at the practice so that doctors can use the camera features for consultation with their colleagues if required.

The Cradle Coast Electronic Health Information Exchange for north-west Tasmania has been a collaborative project of the UTAS Rural Clinical School, General Practice North West, the North West Area Health Service and the Cradle Coast Authority. The information exchange support team have had a very positive response from GPs, allied health professionals and specialists. Traditionally, the Tasmanian divisions of general practice have not worked with specialists and allied health professionals on collaborative IT initiatives. The north-west division engaged with the Cradle Coast Authority and with general practitioners, specialists and allied health professionals to install, train and support the uptake of a common, secure messaging platform, achieving the right balance between technology and the personal aspect of e-health initiatives for the support officers to increase the uptake of the new system.

The platform enables patient referral letters to be sent electronically, rather than using traditional paper based processes. Electronic referrals jumped from under 400 a month to 2½ thousand a month in just 12 months because of the hard work of the support officers, and the time they spent, with individual practitioners and their practices in adapting IT solutions to existing business processes. A specialist practice has reported time savings from eliminating printing, folding and putting letters into envelopes and a reduction of its monthly postal costs by $300. E-health teams are encouraged to focus on the personal side of IT and go over and above installing software and providing instructions. It does take time and effort, but the initiative has been embraced by healthcare providers, and the pilot will be used across the nation as this bill is enacted and the national e-health rollout continues.

During a recent spell of hospitalisation, I had a facial X-ray scan at a medical imaging facility. I was very surprised that there was no requirement for me to wait around for the slides to be processed and printed—no careful carrying of those slides between the imaging facility and the specialist. The e-health link between the medical imaging facility and the specialist's surgery was so comprehensive that, by the time I arrived for the appointment the next day, the specialist had already had time to study the images. He conveyed to me his enthusiasm for the arrival of the NBN and how this would enable more comprehensive e-health records. It will make it easier for him to communicate with other specialists in the community sector, in private practice and in hospitals.

The assistance package announced by Minister Plibersek last week in Tasmania will see an additional $36.8 million over four years used to roll out personally controlled e-health records in Tasmania's hospitals and enable allied health, pathology and diagnostic imaging services to connect to e-health. In consultations with Minister Plibersek, front-line health professionals—surgeons, psychiatrists, paediatricians, social workers and emergency department nurses—all emphasised how enhanced e-health records would reduce errors and duplication, and improve the efficiency of their work.

Together with the funding for e-health records, the package will deliver $31.2 million for an elective surgery blitz, providing about 2,600 additional surgeries, targeted at areas where there are large numbers of patients whose surgery is overdue, such as orthopaedic and cataract surgery. There is around $22 million to establish walk-in clinics in Hobart and Launceston to provide care for minor illnesses and injuries over extended hours and at no charge to patients, alleviating the pressures on emergency departments. There is $48.7 million over four years for Tasmania Medicare Local, to support better care in the community to prevent and manage chronic disease. Individual GPs will continue to have central responsibility for the clinical care of their patients, with Tasmania Medicare Local supporting allied and preventative health services and the coordination of care. Additional support will include providing strength development and fitness programs for frail older Tasmanians, and addressing smoking, excessive alcohol consumption, physical inactivity and poor diet.

There is $74.5 million to provide better care for patients when they are discharged from hospital and to provide better palliative care in the community. Tasmania Medicare Local will help build and support better links between hospitals and GPs by ensuring that appropriate follow-up care and services, such as rehabilitation, are available post hospitalisation. This is expected to reduce avoidable readmissions to hospital. Expanding access to community-based palliative care services will enable people to remain at home, if they wish, at the end of their life, with support for health professionals to improve their palliative care skills and for electronic advanced care planning, building on a model pioneered by the Cradle Coast Authority and North West Area Health Service.

There is $53.9 million to train more medical specialists in Tasmania and provide more scholarships for nurses and allied health professionals, with up to 132 undergraduate clinical placement scholarships per annum, up to 48 postgraduate scholarships per annum and up to 70 continuing professional development scholarships per annum.

There is $15.4 million that will target service gaps in mental health services and population groups who currently have poor access to mental health services.

There is $42 million to support innovation in clinical services that would enable care to be delivered more effectively and efficiently. This will include $1 million in seed funding to establish a virtual health sciences precinct, bringing together Tasmanian hospitals, the University of Tasmania's Faculty of Health Science, the Menzies Research Institute, the Clifford Craig Medical Research Trust and appropriate primary care providers.

This funding will provide both a short-term boost to elective surgery and increase the rollout of e-health records, as well as a plan for how we can manage the long-term issues Tasmania faces with its older population, higher rates of chronic disease and system constraints. The funding addresses concerns raised in conversations across Tasmania with health professionals. For example, in the north-west, 18 health professionals joined Minister Plibersek in a small workshop room in the North West Regional Hospital's medical school. Joining the hospital's director of surgery and North West Area Health Service CEO were front-line nurses, doctors, allied health professionals, public servants, private practice operators and those who worked in both. There were people interested in research, those keen to just get things rolling again and some who wanted to revolutionise the system. They were all united in a desire to rebuild Tasmania's health system both for their community and for their colleagues. Gone were the squabbles between doctors and nurses. This meeting presented a united front to the minister and demonstrated just why Tasmanians and Australians should be very proud of our health professionals.

I was very impressed by the constructive attitude on display, not about a hand-out to patch up the issues but a focus on targeting the areas that would give the greatest return for the Commonwealth dollar, if it were to be forthcoming, and of course seeking the greatest return for the health of people in Tasmania, specifically in my area, the north-west coast. There was no desire to seek undue credit for anything but a real sense that this was our time to explain to the minister what we really do well in north-west Tasmania and what we need help with. We heard that there is no point throwing a lot of money at elective surgery when there are also significant bottlenecks in preparing someone for surgery and in rehabilitating them afterwards, as well as the important facet of our health system of trying to keep people well and out of surgery to begin with. That is exactly why systems research and e-health infrastructure definitely need to be expanded. North-west Tasmania is leading the nation in the rollout of e-health infrastructure and capacity. E-health makes getting treatment simpler for patients and delivers treatment more easily for health professionals. This is another positive reform being brought about by a Labor government committed to improving the health outcomes of Tasmanians both now and in the long term. I commend the bills to the Senate.

Senator EGGLESTON (Western Australia) (16:31): Earlier this month I had the opportunity to travel to London for a Commonwealth Economic Forum and, as is obviously the case when leaving the country for foreign travel, the most important thing a person does is pass through immigration. I was very impressed by the fact that in our airports these days an electronic system looks at passports and confirms the identity of individuals. That is an example of IT being used in a very positive way. I think the introduction of electronic health records is a similar technological advance which will lead to greater efficiencies in the health industry, especially when a person away from their home base is struck by illness and their medical records can be available through the system of e-health records.

As has been said by other speakers, the coalition supports the concept of personally controlled electronic health records and the amendments to this bill. There is no doubt that the benefits of having an accessible electronic health record available around the country are great and have been referred to by many other speakers. This system is commonly referred to as e-health. It is certainly an exciting advancement, extending the scope of primary health care and protecting patients who are travelling. The efficiencies e-health can create are not new concepts to the coalition. Under the last coalition government, computerisation of general practice increased from 17 per cent in 1997 to about 94 per cent 10 years later. That meant that 94 per cent of general practices around the country had computers and patient records were kept much more systematically. The data within them was much more easily accessible to medical practitioners and to people doing research, for example, into the efficacy of drugs for the treatment of hypertension in which a general practice might have been participating. Accessing the records of the serial measurements of a patient's blood pressure is much easier with computers in general practice. Linking general practices to make up a huge pool of patients has been used widely in the United Kingdom to test new drugs, to record outcomes and to file those outcomes back to the university or wherever the trial was being facilitated, all linked by the internet.

The real value of this system is that when a patient who is away from their home becomes ill it is possible with an e-health record system that they can go to a hospital or perhaps to a medical practice anywhere in the country where their medical records will be accessible. This will mean that people can be treated much more quickly and effectively because the detail of their histories will be accessible. Very often people are not as aware of the details of their medical history as one might hope or imagine they would be. That is going to be one of the great benefits of electronic health records.

It has been forecast that by 2020 e-health capabilities could save up to $7.6 billion a year in health costs by reducing duplication and errors, by improving productivity and by providing better adherence to best practice principles. The government's own numbers suggest that the benefits of e-health records alone in Australia would be $11.5 billion saved by the year 2025. That is an incredibly large figure which in itself justifies completely the introduction of the system.

In addition, the same report suggests that a full e-health program can help avoid up to 5,000 deaths annually once the system is in full operation. That is a very important and practical consideration as well. It again shows how beneficial this program potentially will be to the Australian public.

The report further states that, annually, a fully implemented e-health system could avoid up to two million primary care and outpatients visits, 500,000 emergency department visits and 310,000 hospital admissions. They are amazing figures that testify to the efficiencies and cost savings that this system will introduce to our health system.

Importantly, it will also mean that patients have their entire medical history available to them anywhere they travel. A patient with a patient-controlled electronic health record who becomes ill while travelling has their full medical history available to the doctor or emergency department they visit. These are very important benefits.

The downside of the electronic health record system is the protection of patient privacy. There are very legitimate concerns about patient privacy in relation to the introduction of electronic health records. We all know that it is very easy to hack into computer systems. Persons' health records are often very important to their capability of getting a job or insurance. People are quite rightly concerned that the privacy of their health records should be protected, not only for those reasons but just for the general issue of privacy and confidentiality of a person's health records and for the protection of the privacy of the doctor-patient relationship. For this reason the issue of privacy is the biggest concern that people have in association with the idea of the introduction of electronic health records. I think it is very important that the government and those who are responsible for setting up this system make sure that the question of privacy is uppermost in their minds and that the absolute confidentiality of health records is protected. It is a very important consideration.

The idea of electronic health records, and having wide accessibility to them, is one that is under consideration around the world. When I was at the United Nations in 2010, I met a British doctor who was interested in an e-health system in which medical records could be accessible anywhere in the world. In my view it is very bold thinking of his to contemplate a system whereby wherever you were in the world your health records could be accessed through the internet by responsible individuals in a hospital. It would be very hard to set up such a system, but not impossible in this day and age.

Unfortunately, the British experiment with e-health was not a great success. After expending a great deal of money, unfortunately the United Kingdom's system was scrapped, in late 2011. The British had spent some $12 billion on their e-health equivalent of this proposal. So we do have to make sure that the system is efficiently managed and that the concerns for patient privacy are respected. But overall I think the benefits that this system will bring to Australia and to the Australian public are great, and the coalition endorses this system, as I do as a former medical practitioner. I can see great benefits in having access at your fingertips to a patient's records and to the records of an individual from some other part of the country who might come in to see you. It is certainly going to be an interesting exercise to see how this system develops. But I am sure that, with goodwill and concern, once this system is up and running we will have a very useful tool to ensure that the health of Australians is protected wherever they travel in this country.

Senator POLLEY (Tasmania—Deputy Government Whip in the Senate) (16:42): I rise to fully endorse and support the Personally Controlled Electronic Health Records Bill 2011 and the Personally Controlled Electronic Health Records (Consequential Amendments) Bill 2011. This is another plank in building our health system in this country. Earlier in this debate a member of the opposition made reference to former minister for health Tony Abbott and the contribution he made. I just thought we should correct the record. I would not be proud of having been part of a government where the minister for health ripped $1 billion out of the health system.

Before talking about this legislation I want to refer to the very positive developments that took place last week in Tasmania, when the Minister for Health, the Hon. Tanya Plibersek, announced a much needed injection of funds into the Tasmanian health system. I would like to commend not only the current minister, the Hon. Tanya Plibersek, but also the former Minister for Health and Ageing, the Hon. Nicola Roxon, because they have listened to the Tasmanian people over a long period of time and have now invested in health where the Tasmanian community best needs that money spent at this point in time. Some $31.2 million over four years will be provided for an elective surgery blitz, providing about 2,600 additional surgeries targeted at areas of need; about $22 million to establish walk-in clinics in Hobart and Launceston that will provide care for minor illnesses and injuries, for extended hours and at no cost to patients, thus removing pressure on our departments of emergency medicine; and $48.7 million over four years to support Better Care in the Community to prevent and manage chronic disease through the Tasmanian Medicare Local. Individual GPs will continue to have central responsibility for the clinical care of their patients, with the Tasmanian Medicare Local supporting allied and preventive health services and the coordination of care. Given the disease profile of health in Tasmania, this is an very important consideration.

Further, there will be $74.5 million over four years to provide better care for patients when they are discharged from hospital and, most importantly—and something I have been lobbying for for a long period of time—better palliative care in the community; and $53.9 million over four years to train more medical specialists in Tasmania and provide more scholarships for nurses and allied health professionals. The very limited training of allied health professionals has had a significant effect on service provision in my state of Tasmania. There will be $15.4 million over four years to address gaps in mental health services; $36.8 million over four years to roll out the personally controlled electronic health record in Tasmania's hospitals and enable allied health, pathology and diagnostic imaging services to connect to e-health; and $42.0 million over four years to support innovation in clinical services that will enable care to be delivered more effectively and efficiently. This will include $1 million in seed funding to establish a virtual health sciences precinct, bringing together Tasmanian hospitals, the University of Tasmania Faculty of Health Science, the Menzies Research Institute, the Clifford Craig Medical Research Trust and appropriate primary care providers

The reasons I raise this are manifold. Firstly, this came as a consequence of the efforts of Tasmanian politicians, both in this chamber and in the other place, over quite a considerable period of time. This is not a spur-of-the-moment decision but a considered response to the unique situation in Tasmania. Community and, particularly, clinician consultation with Minister Plibersek contributed to the development of this package. This was gathering information at the grassroots level. As the minister has said on many occasions, her Labor colleagues in the House of Representatives and the Senate have camped out in her office. If I recall correctly, last Friday she said she was possibly looking at an extension to her ministerial office to accommodate her Tasmanian colleagues!

This reflects the concern of this government to act in the best interests of the Australian community. This is in stark contrast to the Howard government's overt operations to downgrade a public health system, upon which much of our community relies, and drive people into a private system, which was often beyond their resources. We only have to look at the US to see the effect of reliance on private health care: 15 per cent of population have no access to health care—some 47 million people. I could outline a number of things that have been brought to my attention in relation to the lack of access for Americans to their health system, because it is quite frankly unaffordable and not available to most Americans.

But to get back to the health forums that were held in Launceston, at the one held at Launceston General Hospital all the health professionals were represented, and it was a very vigorous and engaging exchange of views and ideas. And it was suggested very strongly, at all the forums around Tasmania, that there was a desire—a need, in fact—for electronic health records, and that the e-health in this legislation was a step in the right direction.

Clearly, this is a major indicator of the $36.8 million over four years to roll out the personally controlled electronic health records. The Personally Controlled Electronic Health Records Bill 2011, the PCEHR Bill, will establish the national personally controlled electronic health record, PCEHR, system. The PCEHR system and its regulatory framework will include an entity that will be responsible for the operation of the PCEHR system.

These bills will also implement a privacy regime specific to the PCEHR system which will generally operate concurrently with Commonwealth, state and territory privacy laws. The national e-health strategy, endorsed by health ministers in 2008, recognised that a 21st century healthcare system requires 21st century health information infrastructure in order to achieve its vision, which is to enable a safer, higher quality, more equitable and sustainable health system for all Australians by transforming the way information is used to plan, manage and deliver healthcare services. And that is obviously underpinned by the rollout of the National Broadband Network.

Underpinning this vision is a recognition that significant improvements in the way that health information is accessed and shared is required if Australia is to maintain a world-class health system in the face of rapidly increasing demand and costs. The purpose of the Personally Controlled Electronic Health Records (Consequential Amendments) Bill 2011 is to ensure that the PCEHR Bill, once enacted, operates appropriately and effectively. This will be achieved by making a number of amendments to the Healthcare Identifiers Act 2010 and other legislation to allow participants in the PCEHR system to take up and use healthcare identifiers to support the secure and accurate sharing of records within the PCEHR system.

The Healthcare Identifiers Service, the HI Service, was created by the HI Act as a foundation element for electronic transmission of health records. By assigning a unique identifier to each consumer, individual healthcare provider and healthcare provider organisations, the HI Service provides a solid basis for ensuring that a health record is attached to the PCEHR of the right consumer, restricting the ability to author a clinical record for the PCEHR system to qualified healthcare providers and making sure that connection to the PCEHR system is only available to those healthcare provider organisations that meet technical and security requirements. As a result, a health record entering the PCEHR system will typically contain all three kinds of healthcare identifiers. The healthcare provider organisation's identifier will be used to identify the provider organisation to the system, the individual healthcare provider's identifier will be used to identify the author of a record uploaded to the system, and the consumer's identifier will be used to identify the PCEHR to which the record should be attached.

The consequential bill amends the HI Act to allow healthcare identifiers to play a central role in the integrity, security and safety of the PCEHR system. The consequential bill will also make amendments to the Health Insurance Act 1973 and the National Health Act 1953 to allow a range of health records created by Medicare to be included in an consumer's PCEHR where a consumer wants that information to be included.

The Senate Community Affairs Legislation Committee clearly reported the following:

Submitters to the inquiry have been in favour of the benefits that will result from the implementation of the PCEHR system, many recognising that it is time that such a system were implemented.

The AMA commented as follows:

... most members are enthusiastic about using a shared electronic health record. They know that with the right system they can improve the patient's healthcare experience. The right sort of shared record system will help doctors deliver better care. They will have important information about their patients to help them to make good clinical decisions.

The Royal Australian College of General Practitioners stated that they continue to strongly support the PCEHR and the foundations of electronic communications.

Support for the bills came not only from medical organisations. The Aboriginal Health Council of Western Australia was similarly supportive of the system and also identified that its introduction will see benefits delivered to patients, particularly those in remote and rural Australia. They said:

We also very much see that the proposed legislation has great potential to enhance better patient outcomes in Aboriginal communities. Our sector also sees that this has a role to play in terms of Closing the Gap. It is also very clear from what the government is saying they are trying to do that this particular legislation and the proposal would support people who are in remote and regional centres.

Submissions to the Senate committee raised some concerns about the system operator. These were addressed by the Department of Health and Ageing, who stated that they believed the compromise between a private organisation and an interdisciplinary statutory authority was a sensible middle position. They said that the membership of the advisory committee should be as diverse as possible. The committee felt that both of these issues should be reviewed in two years but should not delay the development of this important improvement to health care.

Debate about the opt-in or opt-out issue raised arguments on both sides. This issue should be revisited in the two-year review. But it must be remembered that this is the beginning of a system and, as long as we accept that review and even change can occur, we need to get on with this, as with many of the other health reforms that are being implemented. Safety is critical to the operation of the system. We need clear definitions, privacy and access. The time line for introduction has also been raised. But no good reason has been raised to not proceed with the introduction of personally controlled electronic health records.

The Greens have raised recommendations about additional privacy controls, community consultation and data aggregation. The coalition, who as usual see everything in a negative light, wish to delay it for another year. But, as I said earlier, we need to implement what is necessary. The commentary at the health forum in Launceston last week confirmed to me that moving ahead with these two pieces of legislation is what is needed. We should stop procrastinating and do what needs to be done. From what I can see, these pieces of legislation and the investment that the federal government has made in Tasmanian healthcare services relating to them are steps in the right direction and will provide a good foundation for us to build on as we continue making and dealing with revolutionary changes not only in our economy and in health but in the way that we provide services to the members of our communities.

Senator MASON (Queensland) (16:57): The coalition opposition supports the Personally Controlled Electronic Health Records Bill 2011 and the Personally Controlled Electronic Health Records (Consequential Amendments) Bill 2011. A personally controlled electronic health record system is, let us face it, a very good idea. Any improvement to mankind's armoury against the empire of disease is a very good thing as well. Senators in this debate this afternoon have spoken about the advantages of such a system, and indeed it does have advantages. I accept that this system will assist in effective, efficient and timely patient care. I accept that this system will save time and allow medical practitioners to rely on information noted by other doctors rather than forcing patients to relay their medical history. I accept that the system could dramatically reduce the number of hospital visits each year. I accept that the system could also help prevent thousands of deaths annually when the system is fully operational, another significant advantage provided by e-health.

We also should not forget about the dollars. It is very important in these times of fiscal stringency to save taxpayer dollars. This system may well save billions of dollars over the next 10 to 15 years, by reducing duplication and errors, improving productivity and encouraging stricter adherence to world's best practice. These are all good things. I know that coalition senators and members such as Senator Fierravanti-Wells, Dr Southcott in the other place and Senator Sue Boyce have done a lot of work on this particular issue, and I want to congratulate all of them.

But the opposition does have some reservations. Once again we encounter the standard problem with this government. They come up with some very good ideas now and then, but that is often marred by lack of attention to detail and poor implementation. You will recall that it was the coalition that initiated the focus on shared electronic health records. But again this is a program that the Labor government has not fully developed. I listened before to Senator Di Natale and I loved his use of the words 'soft launch'. We now know that even though the system is being launched on 1 July this year, it is being 'soft launched', which I think means it will be quite some time before the system is ubiquitous. I think that is probably right. But I liked the language—slightly Orwellian, but it never gets by the opposition. We are not quite sure about the costs. The government has not been too forthcoming about the long-term costs of this technology. We know it is expensive, but that does not mean it is not worth it. Already it has been raised in debate that the United Kingdom spent about $12 billion on e-health records and that money has now largely been scrapped. It would not be a good thing for this government to go the same way. I am hoping the Australian Labor Party is not like the British Labour Party in this context—I am in a generous mood and so I will not assume it is.

An opposition senator: You always are.

Senator MASON: Yes, I always am! Some of my colleagues have raised the issue of stakeholder use and how some will see it as a make-work scheme for medical practitioners with little incentive to create the shared health summaries. That is a potential problem and of course there is a reliance on general practitioners to drive the uptake. Some have already asked this afternoon why would they bother doing that. It will take time, and they will see little or no reward for their efforts. Over time, perhaps, that will change, but, initially, I think it is fair to say, it will be an issue. My colleagues have raised—Senator Fierravanti-Wells raised it well and eloquently—the lack of stakeholder consultation. Reports from a number of key stakeholders indicate there was not thorough consultation and they had difficulty communicating with the National E-Health Transition Authority.

They are all important points, and I know that the Senate has discussed them well this afternoon. I congratulate all my colleagues for their contributions in this debate. But I want to concentrate on one particular issue, if I might. As Senator Polley just recognised—and I agree with her—health records are among the most sensitive records citizens give to a doctor, but governments potentially have access too. They hold potentially the most personal, sensitive information. So, of course, there are significant privacy concerns about these e-health records—about access, about their security, about their veracity, about the control over contents, the use and the potential use of these e-health records. All those issues are legitimate and they are all live in this debate.

This is one of those absolutely classic Senate debates because this debate reflects that most fundamental tension in regulating a liberal democracy—that is, the quest for individual autonomy and individual privacy on the part of every citizen versus the impulse of a community and social responsibility. That tension between the two—it is not a dichotomy; it is a tension—is being played out in this debate. While the government does have a moral responsibility to look after their citizens—and e-health is a very good example of that—citizens do not want the state to intrude excessively upon their autonomy in extracting that information. Somewhere in that tension lies the answer and lies the balance. Exactly where those boundaries should be drawn will always be widely contested and hence the privacy concerns raised by citizens about these bills.

The government is quite right to suggest, as they have this afternoon, that the government's decision to have an opt-in scheme—I remember discussing an opt-in or opt-out scheme a long time ago, Acting Deputy President Boyce, with you and others. But the government having chosen that—that is, people have to choose to register to have a personally-controlled electronic health record—it does raise the question of privacy protections. Privacy remains a concern, but with an opt-in scheme they are strengthened, and I acknowledge that. In my view the government should be congratulated for that.

Last week I happened to watch the 7.30 on the ABC—even though I am in the opposition, I do watch the ABC—with Professor Chris Puplick, the former New South Wales Privacy Commissioner, and he was asked about this legislation.

Senator Feeney: And former Liberal Party senator.

Senator MASON: Yes, and former Liberal Party senator and former President of the New South Wales Anti-Discrimination Board as well—appointed by a state Labor government. What he said was very interesting. He said that just like the internet, once the information is out there it will always be available to someone somewhere, regardless of restrictions and limitations. That, of course, is the problem. There is an oft-quoted saying among IT people that goes along these lines: information wants to be set free, but that does not mean that people necessarily want information to be free. Sometimes that is for good reasons—like patients wanting to protect their data—or sometimes for the wrong reasons, like authoritarian governments wanting to maintain their grip on power. It simply expresses the significant reality that once a genie is out of the bottle it is impossible to put it back in. When information is out, when it is set free, you cannot put it back in, because—guess what?—it is everywhere, particularly today with the promiscuous exchange of information, garnered by the internet, social media and other media enterprises. The fact is that these days information when leaked or when out is out forever. The information to be contained within this system is of an intensely personal and private nature, much of which may never leave the inner sanctum of a doctor's surgery. Given that the personal electronic health records system will, by its nature, exponentially increase the number of people with access to these details, it is not unreasonable for patients to fear that the risk of information being obtained by someone other than their doctor will also increase—and that is the concern. People are entitled to be concerned that their medical history could fall into hands in which it does not necessarily belong. Let us face it: in the profession many of us work in, the profession of politics, health records could devastate or potentially even destroy a political career. As examples take evidence of mental illness or evidence that someone is suffering from cancer or evidence that perhaps a woman at one stage even had an abortion or evidence that someone has contracted a sexually transmitted disease at some stage. All of these could be very embarrassing and would certainly be compromising and potentially they could destroy a political or a corporate or a legal or other career. That is why these records are so important and why their protection is absolutely and utterly vital. If they are released, even if they are released inadvertently, people would become subject to prejudice or subject potentially to blackmail. It could have detrimental impacts on their relationships, their work or their insurance and so on. There must be no unauthorised access.

It was not long ago, as you would recall, Madam Acting Deputy President, that we had the example of the stolen laptop in the United Kingdom, and this is not the only story of its kind. In about the middle of last year a laptop containing health information on over 8½ million patients and 18 million hospital visits, operations and procedures was stolen from a National Health Service building in London. The data did not contain names but it did include postcode, gender and age details. There were concerns at the time that the information could be used against the subjects by, for example, blackmail over sensitive medical issues and so forth. That is the sort of problem that is possible, hence the enormous concern as to privacy.

I note Senator Polley, when speaking before, mentioned the United States health system. The United States electronic health record system has been described as 'Wikileaks on steroids'. But while Australia's privacy laws generally do offer greater protection than do those in the United States, it is an interesting and concerning analogy for this kind of system. It is certainly a concerning analogy at least. Even with access to information by authorised users, so by those authorised to look at the information, there are still privacy concerns. Who owns the information? Can I change information that I deem to be wrong or inaccurate? Can I do that? Can I do that unilaterally? Can I restrict access by others to certain types of information? For example, I might not want my GP to know about my mental illness—

Senator Scullion: Or your drug addiction.

Senator MASON: Indeed, my drug addiction or some disease that I have contracted or whatever else. It could be embarrassing. Again, where do we draw the line? How does the regime in this bill interact with, in particular, the provisions of the Privacy Act, which, of course, is the ultimate protector of privacy in this country? All these issues are on the table. I accept what the government has said, that there will be at least a review of these issues in two years time, and again I say I think that is a very good thing because within that time of the next two years the true utility of this law can be addressed. I simply conclude by saying that for the good health of our nation I hope the government—for that matter any government of whatever political complexion—will address these privacy issues with very great discretion. Not to do so could lead to compromising of privacy and a shocking infringement of individual rights.

Senator CAROL BROWN (Tasmania—Deputy Government Whip in the Senate) (17:12): I also rise to make a brief contribution to debate on the legislation before us, the Personally Controlled Electronic Health Records Bill 2011 and the Personally Controlled Electronic Health Records (Consequential Amendments) Bill 2011. Currently we have the health records of patients scattered across a range of locations and attached to different clinics and hospitals, so we need to have a system that allows for a patient's whole health record to be easily accessible, no matter what medical facility they may present at. It is inefficient and potentially dangerous to a patient's health if they have to retell their medical history each time they visit a different healthcare provider. So that is why the Gillard Labor government has announced a $466 million investment over two years for the establishment of an electronic health records system. This funding is to establish the personally controlled electronic health records system national infrastructure. This will prove to be a vital piece of health technology as we continue to find more efficient and effective ways to treat patients.

The outdated approached of paper records or records that do not travel with a patient when they present at a new health facility can cause unnecessary delays and medical errors. In fact, medication errors cause about 190,000 hospital admissions each year, with eight per cent of those being because of inadequate consumer information. So that is why from 1 July 2012 we will begin to roll out the personally controlled electronic health records system. This is the next step in using e-health to enhance our healthcare system. It will create an individual electronic patient record that has the capability to be shared securely over the internet and it will be available to help treat a patient when and where it is needed. From 1 July 2012 individuals will have the option to register for a personally controlled electronic health record. The first stage of the e-health rollout will deliver the core functionality required to establish a system which can grow over time. Individuals can choose not to have a personally controlled the record and, if they choose to participate, they will be able to set their own access controls or enable default access settings. Once the individual has selected the permission level, key pieces of their health information may be viewed at participating healthcare providers across different locations and healthcare settings. Already, the federal government is making a significant investment in the nation's health system, and the personally controlled electronic health records are the next cog in this investment.

As part of our investment in health care, the federal government has signed with states and territories in a historic health reform agreement which will deliver a better deal for patients. This historic national health agreement ensures we can deliver the funding our public hospitals need, with unprecedented levels of transparency and accountability, less waste and significantly less waiting for patients. This new deal provides a much-needed funding boost to hospitals and ensures, through the provision of tough national standards, that the money goes straight to hospitals and, in turn, straight to patients. Together, the Commonwealth, the states and the territories will share in funding growth in an equal partnership. There will be a single national funding pool, activity based funding and national standards, including guarantees on emergency waiting times and elective surgery waiting lists, and it will improve front-line care through the afterhours GP helpline, Medicare Locals and GP superclinics. In effect, this funding deal ensures that our hospitals are able to invest in the infrastructure they need to provide the very best health care for all Australians.

As a Senator for Tasmania, I am particularly concerned about the Tasmanian health system and ensuring that the healthcare needs of Tasmanians are looked after. I am pleased to say that Tasmanians will benefit from the introduction of personally controlled e-health records. In fact, the whole Tasmanian health system is already benefitting from significant investment from the federal Labor government. The Tasmanian health system received a significant boost only last week when the Minister for Health, Tanya Plibersek, announced a $325 million package over four years for an emergency rescue of the Tasmanian health system. We know that the Tasmanian health system is facing significant pressures and has some unique challenges. For instance, we know that Tasmania has an older population and that the proportion of our older people is growing more quickly than in any other state or territory. Tasmania has a small and geographically dispersed population which suffers from a higher prevalence of chronic disease and has higher health risk factors. That is why I was pleased to see the Minister for Health come to Tasmania, after strong lobbying from the Tasmanian parliamentary Labor team, to conduct consultations with front-line health professionals, unions, Tasmanian Medicare Locals, Tasmanian Health Organisations, members of parliament and the Tasmanian state government.

The package announced by the Minister for Health, Tanya Plibersek, will include $31 million for an elective surgery blitz that will provide about 2,600 additional surgeries in areas where large numbers of patients are overdue for surgery, including cataract surgery, knee replacements, hip replacements, hernias and gall bladder surgery, and $22 million to establish walk-in clinics in Hobart and Launceston that will provide care for minor ailments and injuries, for extended hours and at no charge to patients. These centres will link to local general practices and Tasmanian Medicare Locals, to ensure continuity of care for patients. We will also deliver $48 million to better support care in the community to prevent and manage chronic disease through the Tasmanian Medicare Locals. GPs will still continue to have central responsibility for the clinical care of their patients, with Tasmanian Medicare Locals supporting allied and preventative health services and the coordination of care. There is $74 million to provide better care for patients when they are discharged from hospital and better palliative care in the community. There is $53 million to train more medical specialists and provide more scholarships for nurses and allied health professionals, which will deliver up to 34 additional specialist training places, up to 17 new clinical supervisor positions and up to 11 new training coordinators as well as funding for more scholarships for nursing and allied health professionals. There is $15 million to help address gaps in mental health services; $42 million to support innovation in clinical services which will enable care to be delivered more effectively and efficiently; and $36 million to roll personally controlled electronic health records into Tasmanian hospitals and enable allied health, pathology and diagnostic imaging services to connect to e-health.

This investment from the federal Labor government will ensure that the Tasmanian health system is put back on track and will allow us to deliver the very best health care to Tasmanian patients. We need to make structural changes that ensure that the Tasmanian health system is delivered as efficiently as possible to secure the long-term future of the Tasmanian health system. A key component of this is the rollout of the personally controlled electronic health records in Tasmania, which will support public hospitals, allied health, pathology and diagnostic imaging. As part of Minister Plibersek's consultations in Tasmania, it was repeatedly highlighted that e-health would help reduce errors and duplication and help improve the efficiency of care. The issue of e-health was raised at each roundtable that was held by Minister Plibersek in Launceston, Hobart and Burnie. Whilst this investment in Tasmanian health will have significant benefits, the e-health records rollout is very exciting. It stands to deliver significant assistance to help Tasmanian health professionals provide the very best care.

The rest of Australia also stands to benefit considerably from the rollout of the personally controlled electronic health records. E-health represents an important part of the future of health care in Australia for both consumers and healthcare providers. It will enhance the way health care is delivered and result in more efficient and effective health care. The federal Labor government has e-health as an integral part of its health reform agenda, an agenda that aims to continuously improve Australia's healthcare system to ensure that it is accountable, affordable and sustainable, whilst providing the very best of care. Personally controlled electronic health records represent the next exciting stage of our health reform agenda, and I commend the bills to the chamber.

Senator BOYCE (Queensland) (17:22): It is interesting that Senator Brown used the word 'rollout' in her contribution to this debate on the Personally Controlled Electronic Health Records Bill 2011 and the Personally Controlled Electronic Health Records (Consequential Amendments) Bill 2011. In fact, there is no rollout. There is simply a system in which you can lodge your interest to be involved in what is happening on 1 July. It reminds us of this government's 'ability' to roll out the NBN in Tasmania. It leads us to the same sort of mismanagement, waste and inability to implement which we saw during that rollout and which is now happening with this rollout. I certainly share Senator Brown's hope that e-health will be useful to the people of Tasmania, but I do not have any certainty around that. I also hope that it will be useful to the people of Queensland, but again I do not have any certainty around that. I hope it will be useful to the people of Australia, but there cannot be any certainty around that either.

As numerous speakers have pointed out this afternoon, e-health is a noble aim. It is certainly something that we should do. Because of the work of successive governments in Australia—our current statistical collection and our work to date on definitions and standardisation of all manner of things within the health area—we are possibly in a better position to do it. We are in a better position than almost any other country in the world to do this well.

But today we are talking about the introduction of the personally controlled e-health records aspect of an e-health system. Once again, we are looking at fantastic rhetoric and zilch delivery, zilch implementation. The personally controlled e-health record system is supposed to start on 1 July. As Senator Di Natale said earlier, it will be a 'soft launch'. It will be a very soft launch. It will be an almost ghostly launch—a Mary Celeste launch—because there is nothing in this ship to launch. It is simply a shell waiting to be populated. Fine. But this government should not go on with nonsense about what is going to happen.

Minister Roxon, the former health minister, talked about the e-health revolution that would be coming. It was in January 2011 when she started talking about the e-health revolution. She said:

After the outstanding success of the e-health conference in Melbourne earlier this month, there is strong momentum behind delivering the Government’s $466.7 million PCEHR system by July 2012.

It is fine for Senator Brown to try to suggest that this system is part of the national health and hospital reforms of this government, but it is in fact as meaningful as almost anything else they have done—which is almost nothing. There has been no real progress. Of course they now have to talk about a soft launch. Having gone from the big bang of 'Wow, we're going to have an e-health system that will be the envy of the world,' they are now saying, 'Well, people can just choose to let us know that they would like to be involved from 1 July.' There is at least some vague hope on that basis that the PCEHR legislation will achieve long term some of what it has set out to achieve.

But it is a complete nonsense for this government to try to claim that this legislation is some sort of a move, a reform, a revolution. They need to fess up to the fact that they could not work out how to do it. They could not work how to get it right and now they are going to take the easy option which was suggested to them all along. But of course this government loves to talk the rhetoric, fail to implement, waste money and mismanage as it goes.

As has been noted by other speakers, the coalition will not be opposing this legislation, because we think the idea of having personally controlled e-health records and a proper e-health system is an excellent idea. We are, however, like many stakeholders outside this place, concerned about this government's ability to implement a sensible system that will work. Despite all the promises made by NEHTA, the transitional authority for this program, and DOHA, the personally controlled e-health record system is simply nowhere near ready to launch. It is an idea still. This government needs to confess that it is still just an idea; it is just a ghost of an e-health system.

Key components of the PCEHR are not finished and are nowhere near being finished. Key issues identified during a number of inquiries—and I note one of them was by the Senate Community Affairs Legislation Committee, of which both you and I are members, Madam Acting Deputy President Moore—such as safety, liability and privacy have not been successfully resolved. The coalition, in its minority report to the PCEHR committee last year, suggested that it would be wise for the government to delay the launch until they knew that they had it right and that some of the systems they were intending to use had been trialled in real-life situations. We were concerned this would be a completely dysfunctional system that would cause more harm than good.

One of the key aspects for a functioning e-health system is the public's confidence in it. If it has serious errors or serious problems in its early days, it will take years to regain the trust of the public. I am told that the National E-Health Transition Authority was called to Minister Plibersek's office in recent weeks and was basically told: 'Stop the spin. It's not ready. It won't be ready. 'Let's wind back the rhetoric and the expectations. Let's start talking about soft launches and people choosing to get involved in registering, but let's stop the nonsense about the e-health revolution.' So we have a complete backtrack by this government.

One thing that has not been wound back is the spending. I am somewhat amused by Senator Carol Brown's view that more than $300 million for the hospital system in Tasmania would be sufficient to overcome the unique challenges of the Tasmanian health system. We have some unique challenges in my home state of Queensland in the health and hospitals system too, where over $1 million a day is being forced to be spent to pay the interest rate on the wages bill of the debacle of a health pay system that the former Bligh government implemented. I think perhaps the unique challenge faced by so many of these hospital systems is their Labor state governments which cannot, as this government cannot, properly implement and effectively discipline their own spending.

Let us look, for example, at the liability and risk issues associated with this legislation. Key medical indemnity insurers are warning GPs not to participate as they could be exposed to a new wave of litigation. Insurers are telling doctors not to use the e-health system and the PCEHRs until the issues are settled. The President of Medical Defence Australia, Julian Rait, said his organisation had serious concerns about the legal liabilities doctors would face if they used the PCEHRs and would 'advise members not to participate until these problems are properly addressed'.

As for safety, the fundamental issue of any medical system, one of the comments that came out of the estimates process was that NEHTA had just one document that it could show to the Senate committee demonstrating its interest and concern in the safety of the PCEHRs. It was called the Clinical safety case report. Thirty-three pages of that 34-page document detailed a huge number of safety risks that the PCEHR system was subject to. On page 32, the document says that 'the feedback to date on the clinical safety recommendations has not described to what degree they have been accepted into the design and if they will be included in future specifications'. So, in fact, none of these safety risks have been properly assessed for their level of danger and what needs to happen to get them properly out of the system. Clearly the question of who is going to be liable if things go wrong has been completely avoided. There is no answer to the question: 'Is the system safe?' There is no system, as I said before, so how are they going to know if it is safe? Yet $1.1 billion has been spent on this.

Just last Friday, we had the extraordinary situation of the CEO of NEHTA, Mr Paul Fleming, announcing that the NASH—the National Authentication Service for Health—was not going to be ready for 1 July. They gave the contract to IBM well over 18 months ago—again, to the distress of the local industry. Medical software providers in Australia were shocked when IBM got the job of providing the NASH. One of them even commented to me: 'They have just gone for the safe option. No-one ever got sacked for hiring IBM.' Apparently someone should get sacked for hiring IBM, because the NASH was due on 30 June and it will not be finished.

In the past, Paul Fleming has described the National Authentication Service for Health as:

… a key foundational component for eHealth in Australia. It is essential that the identity of people and organisations involved in each eHealth transaction can be assured, and this requires high quality digital credentials. The NASH, Australia’s first nationwide secure and authenticated service for healthcare delivery organisations and personnel to exchange sensitive eHealth information, will provide this.

That is the description of the NASH.

In March 2011, NEHTA gave the contract to IBM to design this key foundational component. Guess what? On 15 June, Mr Fleming quite happily said that the fact that the delivery of the NASH has been delayed to a date that no-one can tell us:

… will have no impact on the launch of the personally controlled eHealth records system in July, or the ability for consumers to register for an eHealth record.

Let us note that term 'register'. He went on to say:

Australians will be able to register for an eHealth record in July as intended.

That actually was not what was intended. They were supposed to be able to register and use the e-health system from 1 July. They will not be doing that. That is not what will be happening. And, when queried, Mr Fleming said they did not know when IBM were going to fix the problem and when we would have a NASH to go along with the system. Yet the most serious problems raised were around safety, security and privacy. That is what the NASH is designed to protect.

In the Australian last Friday Karen Dearne said:

THE Gillard government's $1.1 billion e-health records program will launch without the key user verification system in place, with the National E-Health Transition Authority (NEHTA) conceding it has failed to deliver the project on time.

I just find it bizarre that this is what happened. But why should we find it bizarre that providing this and implementing it properly is way beyond the skills of this government or its appointees? As I said earlier, we support this legislation because we believe an e-health system is a national imperative. If it functions properly, it will save the public purse millions. But it has to be done properly, it has to be done intelligently and, far more to the point, it has to be done honestly and transparently. That has not happened to date with the way NEHTA has suggested that not having a key component of e-health ready in time for the so-called launch on 1 July is not a problem. I would love to know when someone is going to take responsibility for NEHTA and for the fact that this has gone from being an e-health revolution in early 2011 through to a 'soft launch' where people can put their names forward to say they would like to be involved if they want to, when and if it finally gets delivered.

I am pleased that the government are now slowing down the implementation of e-health, but I am completely displeased that they cannot simply be honest or transparent about the problems that they have encountered along the way. We are all aware of the problems that have come out of the UK, where over £6 billion was invested and wasted by the former Labour government. To everyone's shock and horror, it could not be reclaimed. It was simply wasted and closed down.

We are in a great position in Australia. We currently have 3.6 million people who are registered to receive primary care with their doctors. We are one of the few countries in the world that can actually tell you we have 3.6 million people registered for primary care by their doctors. So why wouldn't we look at using those people as the starting point—the people who have the chronic healthcare programs with their GPs? Why wouldn't we start with that group? These people would benefit from the fact that they will not have to cart X-rays around with them. They will not have to have test after test. They will not have to tell their story over and over. Why wouldn't we start there instead of creating some sort of money-eating machine that we have no hope of implementing successfully and nationally for so long?

There are so many issues that I think we need to work on with regard to these bills. We will be checking to make sure that the legislation does work as intended over time, that people do have sufficient confidence in the security and safety of the system to actually use it and that clinicians find the system functional for them.

I am disappointed at the approach that has been taken almost consistently by NEHTA, the lack of transparency, the lack of consultation with stakeholders until after the event and the lack of honesty here in suggesting, 'We don't need NASH, really.' Yes, they will get a system cobbled together to get them through, but to say that is as good as the one we have just paid $48 million to IBM for is just bizarre. So let us hope this is a good outcome for Australians.

Senator McLUCAS (Queensland—Parliamentary Secretary for Disabilities and Carers and Parliamentary Secretary to the Prime Minister) (17:42): I thank senators for their consideration of the Personally Controlled Electronic Health Records Bill 2011 and the Personally Controlled Electronic Health Records (Consequential Amendments) Bill 2011 and their contributions to the debate on these bills and the amendments. At present, consumer health records are scattered across a range of locations and clinics rather than being attached to the health consumer and easily available at the point of care. That means consumers need to retell their story each time they visit a different healthcare provider. This outdated approach can result in things like unnecessary retesting, delays and, unfortunately, medical errors. For example, we know that medication errors cause around 190,000 admissions to hospital each year, with eight per cent of those errors due to inadequate consumer information. The legislation in front of the chamber this afternoon will help to put an end to that.

The bills before the chamber today establish the essential IT and governance infrastructure that will allow consumers to set up their own personal electronic health records—computer based records that can be accessed anywhere where there is an internet connection. That means records can travel with a health consumer from clinic to clinic and doctor to doctor at the click of a button. Once this essential infrastructure is in place later this year, consumers will be able to opt in and begin registering for personal electronic health records and access a range of basic information on their own health care.

Just as you build a house, these bills help to lay the foundations for e-health today—strong foundations that will underpin the development of the sector as it expands into the future. This is about developing the foundations of the system carefully and systematically. We know this is a complex area of health reform. It is complex, and that is known by those sitting opposite. It is known that this desire for an electronic health record had part of its origin back in 2003, when the coalition embarked on implementing e-health reform and e-health records. The truth is that very little, if anything, was achieved in the period of government between 2003 and 2007. That is no reflection on the officers of the Department of Health and Ageing as seems to have been the case in some of the contributions we have heard today. The harsh language that we have heard from those opposite should, or could, be directed to the health minister of the former Howard government. It is a complex area of health reform.

A national e-health record system will continue to build over time as consumers and healthcare providers join the system. Since 2010 we have been working closely with consumers and healthcare providers to get this right, and will keep doing so. Establishing a national e-health record system is part of our government's e-health agenda, an agenda that builds on the work of GPs, hospitals and other health providers and that is integrating modern technology into health care. Already, 97 per cent of GPs have access to computers and 96 per cent have access to the internet in their consulting rooms. I congratulate GPs for supporting this technology to become part of their practice, with all the benefits of improved efficiency and accuracy that it provides.

Throughout the development of this infrastructure there has been extensive consultation with clinicians, consumers and the health IT industry. We are looking to the health sector and technology experts to innovate and implement. Individuals can choose whether or not to have an e-health record. If they choose to participate they will be able to set up their own privacy and access controls. As the records evolve they will have the capacity to contain health information such as conditions, medications, allergies and records of medical events created by healthcare providers. The records will also be able to include discharge summaries from hospitals, information from Medicare systems and some information entered by consumers. We know that consumers and healthcare providers need to have confidence in the e-health record system and the information it contains, so it is critical to implement a legislative framework that provides robust and transparent governance and appropriate protections for participation in and use of the system. The bills and the amendments that are being debated here today will do just that.

Key elements of the bills will establish the system operator and its advisory bodies, a registration regime for consumers, a privacy and security framework and associated penalty mechanisms and the circumstances in which information in the national e-health record system can be collected, used or disclosed by particular parties. The bill also provides for the legislation to be reviewed after it has been operating for two years.

This is a once-in-a-generation opportunity to deliver these important reforms. These bills are part of the government's bold health reform agenda, reforms that will make it easier for consumers to receive the right care when and where they need it. I commend the bills to the Senate.

Question agreed to.

Bills read a second time.

Senator McLUCAS (Queensland—Parliamentary Secretary for Disabilities and Carers and Parliamentary Secretary to the Prime Minister) (17:49): I table a supplementary explanatory memorandum relating to the government amendments to be moved to these bills. The memorandum was circulated in the chamber on 8 May 2012. I seek leave to move government amendments (1) to (32) on sheet CN235 together.

Leave granted.

I move government amendments (1) to (32) on sheet CN235:

(1)   Clause 5, page 8 (line 15), omit "amended.", substitute "amended; or".

(2)   Clause 5, page 8 (after line 15), at the end of the definition of Ministerial Council, add:

   (c)   if that Agreement is not in force—the COAG council (however described) responsible for health matters.

(3)   Clause 5, page 11 (line 1), before "System", insert "performance of functions under this Act by the".

(4)   Clause 9, page 17 (line 26) to page 18 (line 3), omit subclause (3), substitute:

   (3)   Each of the following is identifying information of an individual, other than an individual in the capacity of a healthcare provider:

   (a)   if applicable, the Medicare number of the individual;

   (b)   if applicable, the Veterans' Affairs Department file number of the individual;

   (c)   the name of the individual;

   (d)   the address of the individual;

   (e)   the date of birth, and the date of birth accuracy indicator, of the individual;

   (f)   the sex of the individual;

   (g)   if the individual was part of a multiple birth—the order in which the individual was born;

Example:   The second of twins.

   (h)   if applicable, the date of death, and the date of death accuracy indicator, of the individual.

(5)   Page 18 (after line 25), at the end of Part 1, add:

13A System Operator may arrange for use of computer programs to make decisions

   (1)   The System Operator may arrange for the use, under the System Operator's control, of computer programs for any purposes for which the System Operator may make decisions under this Act.

   (2)   A decision made by the operation of a computer program under an arrangement made under subsection (1) is taken to be a decision made by the System Operator.

(6)   Clause 15, page 21 (after line 5), after paragraph (m), insert:

   (ma)   to prepare and provide de-identified data for research or public health purposes;

(7)   Clause 38, page 32 (after line 20), at the end of the clause, add:

   (3)   The health information referred to in subsection (2) in relation to a consumer may include the name of one or more healthcare providers that have provided healthcare to the consumer.

(8)   Clause 44, page 35 (line 30), after "provider", insert "organisation".

(9)   Clause 51, page 40 (lines 9 to 12), omit subclause (2), substitute:

Cancellation or suspension if consumer no longer eligible, etc.

   (2)   The System Operator may, in writing, decide to cancel or suspend the registration of a consumer if:

   (a)   the System Operator is no longer satisfied that the consumer is eligible to be registered; or

   (b)   the System Operator is no longer satisfied, having regard to the matters (if any) specified in the PCEHR Rules, that the identity of the consumer has been appropriately verified; or

   (c)   the System Operator is satisfied that, unless the registration of the consumer is cancelled, the security or integrity of the PCEHR system may be compromised, having regard to the matters (if any) prescribed by the PCEHR Rules; or

   (d)   the System Operator is satisfied that the consent referred to in subsection 41(3) in relation to the consumer has been withdrawn; or

   (e)   the System Operator is satisfied that the consent referred to in subsection 41(3) in relation to the consumer was given by an authorised representative or nominated representative of the consumer, and:

   (i)   the authorised representative or nominated representative who gave the consent ceases to be an authorised representative or nominated representative of the consumer; and

   (ii)   the System Operator requests the consumer to give consent of the kind referred to in subsection 41(3); and

   (iii)   the consumer does not, within a reasonable period, give the consent.

(10)   Heading to subclause 51(4), page 40 (line 26), omit "whether consumer eligible", substitute "action in relation to consumer's registration".

(11)   Clause 51, page 40 (line 29), omit "whether a consumer is eligible to registered", substitute "whether to take action under subsection (2) in relation to the consumer's registration".

(12)   Heading to subclause 51(5), page 41 (line 1), omit "whether other entity eligible, etc", substitute "action in relation to entity's registration".

(13)   Clause 51, page 41 (lines 3 to 8), omit all the words from and including "consumer" to and including "registration", substitute "consumer while the System Operator investigates whether to take action under subsection (3) in relation to the entity's registration".

(14)   Clause 58, page 46 (line 9), omit "has applied", substitute "is applying, or has applied,".

(15)   Clause 58, page 46 (lines 29 and 30), omit "has applied", substitute "is applying, or has applied,".

(16)   Clause 73, page 57 (lines 6 to 15), omit the clause, substitute:

73 Contravention of this Act is an interference with privacy

   (1)   An act or practice that contravenes this Act in connection with health information included in a consumer's PCEHR or a provision of Part 4 or 5, or would contravene this Act but for a requirement relating to the state of mind of a person, is taken to be:

   (a)   for the purposes of the Privacy Act 1988, an interference with the privacy of a consumer; and

   (b)   covered by section 13 or 13A of that Act.

   (2)   The respondent to a complaint under the Privacy Act 1988 about an act or practice, other than an act or practice of an agency or organisation, is the individual who engaged in the act or practice.

   (3)   In addition to the Information Commissioner's functions under the Privacy Act 1988, the Information Commissioner has the following functions in relation to the PCEHR system:

   (a)   to investigate an act or practice that may be an interference with the privacy of a consumer under subsection (1) and, if the Information Commissioner considers it appropriate to do so, to attempt by conciliation to effect a settlement of the matters that gave rise to the investigation;

   (b)   to do anything incidental or conducive to the performance of those functions.

   (4)   The Information Commissioner has power to do all things that are necessary or convenient to be done for or in connection with the performance of his or her functions under subsection (3).

Note:   An act or practice that is an interference with privacy may be the subject of a complaint under section 36 of the Privacy Act 1988.

(17)   Page 57 (after line 16), at the end of Division 4, add:

73A Information Commissioner may disclose details of investigations to System Operator

      The Information Commissioner is authorised to disclose to the System Operator any information or documents that relate to an investigation the Information Commissioner conducts because of the operation of section 73, if the Information Commissioner is satisfied that to do so will enable the System Operator to monitor or improve the operation or security of the PCEHR system.

(18)   Page 57, after proposed clause 73A, insert:

73B Obligations of System Operator in relation to correction, etc.

   (1)   The System Operator may, in order to meet its obligations under the Privacy Act 1988 in relation to the correction and alteration of records:

   (a)   request a participant in the PCEHR system to correct personal information contained in a record included in the PCEHR system and, if the participant does so, to upload the corrected record to the PCEHR system; and

   (b)   if the participant refuses to do so—direct the participant to attach to the record a note prepared by the consumer in relation to personal information included in the record, and to upload the record and note to the PCEHR system.

   (2)   A participant in the PCEHR system who is given a direction under paragraph (1)(b) must comply with the direction.

(19)   Clause 74, page 58 (line 9), after "provider", insert "organisation".

(20)   Clause 76, page 60 (line 10), after "provider", insert "organisation".

(21)   Clause 77, page 60 (line 16), before "The", insert "(1)".

(22)   Clause 77, page 60 (after line 29), at the end of the clause, add:

   (2)   Despite subsection (1), the System Operator is authorised, for the purposes of the operation or administration of the PCEHR system:

   (a)   to hold and take such records outside Australia, provided that the records do not include:

   (i)   personal information in relation to a consumer or a participant in the PCEHR system; or

   (ii)   identifying information of an individual or entity; and

   (b)   to process and handle such information outside Australia, provided that the information is neither of the following:

   (i)   personal information in relation to a consumer or a participant in the PCEHR system;

   (ii)   identifying information of an individual or entity.

   (3)   This section does not limit the operation of section 99.

(23)   Clause 97, page 73 (line 28), after "must", insert "take such steps as are reasonably necessary in the circumstances to".

(24)   Clause 99, page 76 (line 17), after "provider", insert "organisation".

(25)   Clause 105, page 80 (line 9), omit "operator", substitute "organisation".

(26)   Clause 105, page 80 (line 12), omit "provider operator", substitute "provider organisation".

(27)   Clause 108, page 84 (after line 2), after subclause (4), insert:

(4A)      Without limiting the matters to be covered by the review, the review must consider the following matters:

   (a)   the identity of the System Operator;

   (b)   alternative governance structures for the PCEHR system;

   (c)   the opt-in nature of the PCEHR system, including the feasibility and appropriateness of a transition to an opt-out system.

(28)   Heading to subclause 109(2), page 85 (line 7), omit "jurisdictional advisory committee", substitute "committee and council".

(29)   Clause 109, page 85 (line 9), after "committee", insert "and the independent advisory council".

(30)   Clause 109, page 85 (line 10), after "committee", insert "or the independent advisory council".

(31)   Clause 109, page 85 (after line 30), after subclause (4), insert:

PCEHR Rules may relate to agreements

   (4A)   The PCEHR Rules may specify that a person must enter into a specified kind of agreement in order to be, and remain, a registered healthcare provider organisation, registered repository operator, registered portal operator or registered contracted service provider.

(32)   Clause 109, page 86 (after line 27), after subclause (7), insert:

PCEHR Rules may relate to research

   (7A)   The PCEHR Rules may specify requirements with which the System Operator and other entities must comply in relation to the preparation and provision of de-identified data for research or public health purposes.

Senator FIERRAVANTI-WELLS (New South Wales) (17:49): Madam Acting Deputy President, I would like, if I could, to ask some questions that pertain to both bills.

The ACTING DEPUTY PRESIDENT ( Senator Moore ): That is fine. Go ahead.

Senator FIERRAVANTI-WELLS: During the debate, Minister, concerns were raised, particularly in relation to privacy, by Senator Boyce and me. Is the government assured that the provisions contained in the amendments go fully to addressing privacy concerns that have been raised not just here but as part of the inquiry by the Senate Community Affairs Legislation Committee. They are of concern and have been of concern throughout this whole process. I really just want to hear, Minister, your assurance that that is the case, particularly in relation to the concerns that were raised in relation to the powers of the Australian Information Commissioner.

Senator McLUCAS (Queensland—Parliamentary Secretary for Disabilities and Carers and Parliamentary Secretary to the Prime Minister) (17:50): The e-health record system will have bank-strength security features, including extremely strong encryption and firewalls. These protections are in line with the very high standards required by both the Department of Defence and the Attorney-General's Department. Paper based records, as we know, can be copied, stolen or modified without anyone knowing. With the e-health record system patients will be able to view a log that shows them every occasion on which their record has been accessed or changed and by whom. Consumers will need a secure password to access the system, which they can invent themselves. The password will then be encrypted, as with internet banking. For even more security, when you log on you will have to enter a personal question to confirm your identity. On top of this, the system will automatically log you off if your session is inactive. As for the question about privacy and security, they are fundamental to the effectiveness of an e-health record system. Unlike the former government's proposal, as I recall, this one is personally controlled, and I think that gives enormous power to the health consumer to manage their personally controlled electronic health record—something that will give the community confidence in the system, which I am sure we are all looking for.

Senator FIERRAVANTI-WELLS (New South Wales) (17:52): I understand that, under these amendments, the role of the system operator in providing de-identified data for research and public health purposes will be clarified, with the objective that the aggregate data be used to improve understanding of population health issues. Again in relation to privacy, when the system is accessed for the purposes of de-identifying data, will that also be covered by the legislation in terms of logging in and logging off? One accepts the logging-in and logging-off where it is a medical practitioner accessing the information. But, with this broader scope, do those provisions ensure that those privacy concerns are met even where the data is used in that manner?

Senator McLUCAS (Queensland—Parliamentary Secretary for Disabilities and Carers and Parliamentary Secretary to the Prime Minister) (17:53): The amendments specify that it is a function of the system operator to prepare and disclose de-identified data for research or public health purposes. The amendments also provide that the minister can make rules to specify requirements with which the system operator must comply when preparing and providing de-identified data. The system operator will be authorised to delegate this function to a Public Service employee of the Department of Health and Ageing, the Chief Executive of Medicare or any other person with the consent of the minister. Despite any delegation functions, the system operator will ultimately be responsible for this function.

It is intended that the rules will provide detailed requirements regarding the manner in which the system operator de-identifies data and discloses it to requesting parties. For example, it will be critical to set rules in respect of de-identifying the information of small populations to ensure persons are not directly or indirectly identifiable. It is likely that the requirements will draw on existing requirements developed by the National Health and Medical Research Council ethics committee or the Aboriginal Health and Medical Research Council. The rules may also provide criteria that the system operator must consider in determining whether or not to disclose the requested de-identified data.

Senator FIERRAVANTI-WELLS (New South Wales) (17:55): Can you outline some of the provisions in relation to strengthening the consent arrangements in the legislation? Could you provide just a little bit more information on that, thank you, and on the circumstances in which those provisions in the amendments will strengthen those consent arrangements?

Senator McLUCAS (Queensland—Parliamentary Secretary for Disabilities and Carers and Parliamentary Secretary to the Prime Minister) (17:56): Could I ask you to be a little more specific, Senator, so I know exactly what issue it is I am trying to address. There are general provisions in the legislation around consent, as you understand. I am trying to accurately answer your question, so I would not mind knowing what you are really asking.

Senator FIERRAVANTI-WELLS (New South Wales) (17:56): I do not have it in front of me, but in the Senate committee inquiry there were concerns raised about the consent arrangements. If the officials have other information and want a bit more time to get it, I have some other questions, if that would help, Parliamentary Secretary. The officials could have a look and maybe come back.

Senator McLucas: That is fine.

Senator FIERRAVANTI-WELLS: That would probably give them a little bit more time. I wanted to address some of the issues about the launch that were raised in the article in today's Australian. The article refers to the launch being 'on hold'. Do we know when that launch at St Vincent's Hospital will take place?

Senator McLUCAS (Queensland—Parliamentary Secretary for Disabilities and Carers and Parliamentary Secretary to the Prime Minister) (17:57): The federal government have been building the infrastructure for a national e-health record system that will allow consumers to set their own computer-based electronic health records. The infrastructure has been built and it is going through the final stages of rigorous testing at the moment. This is about developing the foundations of the system carefully and systematically. We are determined to get it right and to ensure that the system is rolled out properly, phased in over time. The minister has always said that that is what the government would do—and, in the debate on the legislation both here and in the other place, many of those opposite endorsed that approach.

We know this is a complex area of reform and that a national e-health record system will continue to build over time as consumers and healthcare providers join the system. We have been working closely with consumers, healthcare providers and others to get that right, and we will continue to do so.

Senator FIERRAVANTI-WELLS (New South Wales) (17:59): Do I take it that the launch that was planned at St Vincent's Hospital in Sydney for Monday, 2 July, which was to be the first working day of the new system, (1) has been cancelled and (2) has no replacement date?

Senator McLUCAS (Queensland—Parliamentary Secretary for Disabilities and Carers and Parliamentary Secretary to the Prime Minister) (17:59): I will get you some detail on that. To be frank, we are talking about bringing in a fundamental change to the way we provide health services in this country. We are bringing in a massive reform which will improve the health outcomes of Australian health consumers. I think Australians who are interested in their health will be far more interested in whether or not they get a quality personally controlled electronic health record rather than when there will be a launch.

Senator FIERRAVANTI-WELLS (New South Wales) (17:59): But, Minister, the point is that this was all supposed to be ready, and I will not reiterate what Senator Boyce has said. One assumes that, if you have a system which will be rolled out and start from a particular day that it will start on that day. I appreciate your point about a launch but on 1 July, when people should be able to register for electronic health records, it is not likely to be operational. My question to you then is: when is the electronic records system likely to be operational?

Senator McLUCAS (Queensland—Parliamentary Secretary for Disabilities and Carers and Parliamentary Secretary to the Prime Minister) (18:00): I can confirm that health consumers will be able to register on 1 July.

Senator FIERRAVANTI-WELLS (New South Wales) (18:00): Yes, Minister, but they are not going to be able to register online for an electronic system. Is that not the case?

Senator McLUCAS (Queensland—Parliamentary Secretary for Disabilities and Carers and Parliamentary Secretary to the Prime Minister) (18:01): I am advised they can register on 1 July.

Senator FIERRAVANTI-WELLS (New South Wales) (18:01): But they are not going to be able to register online; they will still have to go back to the manual system. Is that not the case?

Senator McLUCAS (Queensland—Parliamentary Secretary for Disabilities and Carers and Parliamentary Secretary to the Prime Minister) (18:01): I am advised that from 1 July people will be able to register on the phone and in person at a Medicare office.

Question agreed to.

Senator McLUCAS (Queensland—Parliamentary Secretary for Disabilities and Carers and Parliamentary Secretary to the Prime Minister) (18:04): I move:

That these bills be now read a third time.

Question agreed to.

Bills read a third time.

Senator BERNARDI (South Australia) (18:05): From 1 July 2012 the Skills Australia Amendment (Australian Workforce and Productivity Agency) Bill 2012 will create the Australian Workforce and Productivity Agency—which I will refer to as 'the agency'—which will replace Skills Australia. The bill gives the agency additional responsibilities other than those which Skills Australia had: providing advice to the minister on improving the productivity of the Australian workforce, providing advice to the minister on the allocation of Commonwealth funding including the National Workforce Development Fund and assessing research relating to improving the productivity of the Australian workforce. The bill also adds three additional board members to the existing arrangements and adds a new category to board membership.

Australia does indeed face skills shortages in a number of important industries. Businesses continue to have problems procuring the right people for the right job. Recently even the ACTU has been critical of the government's approach to addressing the skills shortage with a proposed offshore recruitment drive to fill vacancies in the mining and construction industries. It goes without saying that it is vital for our training systems to work efficiently in order to provide real job prospects are Australians. The Australian Workforce and Productivity Agency is responsible for the $558 million Workforce Development Fund, a fund made available to pay up to half the costs of training for the upskilling of existing workers. The government's contribution equates to $4,292 per training place, based on predictions of training 130,000 workers.

We on the coalition side, like all Australians, need to be convinced that the agenda being pursued by the government is producing value for money. There are some concerns that this policy and indeed this bill appear to have been cobbled together in the ad hoc way that we have seen many times before from this Labor government.

It is worth remembering that the agency established in this bill will replace Skills Australia, which was set up by the Labor government in 2008, just four years ago. Labor has decided to bring forward the work of the agency and have appointed an interim board. So it would now appear that this government has declared Skills Australia to have passed its use-by date. I ask: is Labor saying that Skills Australia did not achieve what it was meant to? Very few other conclusions can be drawn. As my colleague Ms Ley said in the other place:

The failure does not really lie with Skills Australia; it rests with the government …

Skills Australia provided advice and offered ways to improve skills and boost employment. It provided that advice, and the methods, to government, but ultimately it is up to government to act. It seems to me that the government is more interested in trying to spin another story, if you will, for the media's benefit or to convince some people that the government is actually doing something rather than digging deeper past the veneer and actually dealing with the development of skills and our economy. It begs the question: is the government really interested in fundamentally changing Australia's workforce for the better, or is it content to continue to make grandstanding statements and announcements that ultimately make little if any difference to those on the ground?

It would be remiss of me not to comment on the fact that this bill includes what is effectively a $20 million slush fund for the unions, because in addition to the $558 million in the National Workforce Development Fund, the government can allocate $20 million to unions and employer groups. There are, according to my research, no criteria for the allocation of these funds and there is no defined purpose. This leads me to conclude, quite reasonably, that this looks to be just another Labor slush fund for their union mates. It goes almost without saying that with a Labor government there always seem to be some perks for the union movement.

Moving on from the unions, the coalition is concerned that this bill panders to what I would describe as Labor's love of bureaucracy. Here we have this new agency replacing an old agency—it is not old, since it began just four years ago—but it is still doing the same thing, albeit with a few additional responsibilities. The government is spending $25 million over three years to set up this new agency, whereas the old agency only cost $5 million a year to run. It strikes me that this balance is wrong.

A vigilant eye must be kept on these processes to avoid taxpayers' precious money falling through the cracks and to avoid the creation of more red tape that stifles economic opportunity. As every Australian knows, Labor likes to spend. This is evidenced by the last four years of this government. Unfortunately, Labor likes to spend but is not that concerned with what it has to show for it at the end of the day.

During the Senate Education, Employment and Workplaces Relations Legislation Committee's inquiry into this bill, some stakeholders raised concerns about the overlapping of responsibilities between the agency and other bodies. For example, the education departments of both Queensland and New South Wales raised the issue of the agency potentially undertaking duties of the Productivity Commission and/or state and territory bodies. Also, with this government we have seen a major redirection of funding from various training initiatives and programs into what they call new initiatives. For example, the $200 million from the Critical Skills Investment Fund was redirected into the National Workforce Development Fund. Senator Evans, in his capacity as the minster, announced the merging of the funds, in 2011. Far be it for me to simply conclude that this is more money shuffling. But it is apparent that this can confuse stakeholders, who query which fund they now have to apply to in order to gain the appropriate benefits.

For those who do not want to look deeper it gives the appearance of increased funding from the government. These changes made by the government—like moving money around and rebranding agencies—can not only be confusing for industry but can lead to what the Queensland department called 'fragmenting skills investment', where there is a misdirection or waste in how funds are spent. So, it is important that the agency use its resources to support the work already being done by other agencies, rather than adding another level of bureaucracy.

The bill also proposes an initial three board members, and it adds an additional category for membership, that being the representation of employees. I should note here that some stakeholders have proposed that, if employees have their own membership category, employers should too. I will acknowledge that an industry category already exists, but it is not clearly defined. In fact, unions could describe themselves as industry representatives. I hope that in future the government will partake in some common sense and ensure that employers are adequately represented on the agency board.

Another point of concern is the fact that there seems to be no person from the training sector represented on the board. I believe that training should be afforded the same significance as unions and industry. After all, that is a core part of this whole issue: the training of workers. The Australian Council for Private Education and Training has said:

… it is appropriate that the training sector also be represented as part of the Australian Workforce and Productivity Agency membership … such an appointment would add valuable expertise to the AWPA as it develops advice for government.

In the next five years there is expected to be a shortfall of about 250,000 skilled workers in this country. This poses a challenge for all those involved in upskilling our workforce. Training needs to produce the skills that industry requires and is prepared to pay for. This will not happen if the agency's agenda is warped by the government trying to keep its most valued stakeholders happy—and by that, I mean the union movement. Excluding this important level of expertise can only hinder the work of the agency going forward. That is something the coalition does not want to see happen.

There are also a few inconsistencies between this bill and the budget papers that the government should take note of. The first is the task given to the agency regarding funding. The bill states that the agency will provide 'advice' on matters relating to the allocation of Commonwealth funding, including the Workforce Development Fund—and yet the budget papers state that the agency will 'administer' the Workforce Development Fund. Also, the bill says that the agency will assess research relating to improving workforce productivity; whereas the budget papers state that the agency would 'undertake' research. Further clarification to clear up these inconsistencies would be welcome.

The coalition will pay close attention to this new agency, in the hope that this is not just another quick fix or a temporary solution to a problem that the government has. We want it to be an enduring fix for the skills shortages that are apparent in Australia. We want there to be an effective collaboration between industry and government so that the skills requirements of industry can be met and sustained for decades to come. We do not want this agency to become another level of bureaucracy that splashes out, or indulges or provides for its preferred stakeholders, to the long-term detriment of improving Australia's workforce.

In conclusion, the coalition will not be opposing the passage of this bill. We are simply seeking to highlight our concerns. We would like the government to consider them, not only in the initiation of this agency but also in its ongoing operations, whilst it holds the Treasury bench.

Senator THISTLETHWAITE (New South Wales) (18:17): I am pleased to speak in support of the enactment of the Skills Australia Amendment (Australian Workforce and Productivity Agency) Bill 2012. For developed nations to grow their economies, and at the same time have real growth in incomes, there must be productivity growth over the long term. Unfortunately, in Australia at the moment, there is a misguided and often ignorant debate occurring regarding means to stimulate productivity growth in our economy. I am not going to go into the details of that debate at the moment.

Before my time in this place I did have the great honour of representing workers in a number of industries throughout the country. From agricultural to aeronautical industries, from horseracing to the health industry, I had the great privilege of representing workers and their interests and negotiating on their behalf. One of the lessons I learnt from my 14 years as an advocate for workers was that a happy workforce is a productive workforce, and the system of workplace relations—and, importantly, education—must encourage cooperative workplace relations. To encourage cooperative workplace relations, employees must have developed and definite career paths—and an important part of the development of a career path is skills development, ensuring that people are able to attain the education and the skills they require to better themselves and to ultimately increase their earning capacity and their living standards.

Since becoming a senator I have sought to expand my work in visiting workplaces throughout New South Wales. I have also been fortunate to visit many trade training centres throughout the state. Earlier this month I visited Taree, on the mid-north coast of New South Wales, to celebrate the official opening of the Manning Valley Trade Training Centre, a $2.9 million investment by the federal government in an opportunity for students, beginning in years 9 and 10, to commence their trades in hospitality and building trades, at that particular high school. It is a wonderful opportunity for those who are interested in skilling themselves up to begin a trade in the Australian workforce. I have also been fortunate to open trade training centres in Bellingen, in Port Macquarie, in Maclean and in Lithgow—and, in all of these areas and circumstances, the school communities were overwhelmed by the fact that the government is investing in skills development in their local area. We are bringing the community together—bringing employers, educators, parents and students together to increase the skills base of a particular community and ultimately provide more employment prospects for children in those schools. It is initiatives such as this that are ensuring that the workforce of tomorrow is properly skilled and ready to continue driving our economy and making it stronger.

This bill goes further to augmenting the Gillard government's efforts to ensuring the continued success of the Australian economy through skills development. The goal of the this bill is to amend the Skills Australia Act 2008 to establish the Australian Workforce and Productivity Agency in place of Skills Australia. Skills Australia was established by the Skills Australia Act 2008 and commenced operation in April of that year. A Labor government initiative, Skills Australia was designed to address skills shortages by supplying independent research, analysis and advice to government on Australia's skill needs. As it stands, Skills Australia's current role is a wide one. It encompasses various research and development goals associated with improving skills attainment and development in Australia. Its current roles are to analyse and provide policy advice on skills needs, to commission and assess research on workforce development needs, to disseminate information about workforce development and skills, to provide advice to the government and publicly on training reform and to facilitate alignment of resources by maintaining relationships with the states and territories and other stakeholders with an interest in workforce development and skills.

With the passing of this bill, the government is seeking to build on work already undertaken by Skills Australia through the Australian Workforce and Productivity Agency. It is appropriate for productivity to be in the name of this organisation, because ultimately what we are talking about when we talk about skills development in our country is improving productivity growth over the long term, which will be the impetus for long-term economic growth. The agency will assume the functions of Skills Australia but with additional membership and responsibilities. The agency will provide advice to the minister on Australia's current, emerging and future workforce development and workforce skills needs. These are vital issues of importance that, if we are to continue to build on this country's economic success, require our utmost attention.

The agency was announced in the 2011-12 budget, which indicated that the new agency would develop sectoral workforce development plans, undertake research, consult industry and disseminate information on workforce planning issues. The agency will build on and expand the work of Skills Australia. It will give industry a central role in the National Training System, improve long-term workforce planning and development to address skills and labour shortages and contribute to improvements in industry and workplace productivity. One of the factors that is key to ensuring long-term productivity growth, particularly in the current economic climate in Australia, is ensuring that there are not any bottlenecks in our economy. Bottlenecks that have developed over recent years are skills shortages in particular pockets of the economy. We have all seen the stories associated with mining companies in remote areas, in particular, being unable to access skilled workers in particular trades. This body will work with employers, and particularly in remote and regional areas, to ensure that there are plans in place to meet the demand for skills in vital trades. That will foster long-term productivity growth in our economy. It will give industry a stronger voice and ensure that the government's investment in training delivers the skills that industry and the economy need, in the right place at the right time.

Importantly, the agency will have the ability to make recommendations to the government to direct funding to areas of critical industry need and will be an authority on workforce development policy. It will have a central role in advising on expenditure priorities for the National Workforce Development Fund and will be able to provide advice to the government on a range of other skills funding initiatives. It will build on the strengths of Skills Australia and collaborate with industry associations, industry skills councils, unions and employers to ensure a shared and practical approach which meets sectoral, regional and small business industry needs. Fostering cooperation in workplace relations will be a key initiative of this body.

Specifically, the agency will advise the government on expenditure priorities for the National Workforce Development Fund; drive engagement between industry, training providers and government on workforce development, apprenticeships and vocational education and training reform; develop and monitor sectoral skills and workforce development plans in conjunction with industry skills councils; provide independent advice on sectoral and regional skills needs to support workforce planning and productivity, including in small business; promote workforce productivity by leading initiatives for the improvement of productivity, management innovation and skills utilisation within Australian workplaces; and conduct skills and workforce research, including into the future of work and working life in Australia.

One of the fundamental goals of this newly established agency is to improve productivity. One of the primary ways in which it will do this is through skills matching. When an industry is experiencing a boom, it is crucial for that industry to be able to harness that boom by maximising productivity through access to a skilled workforce. The agency will ensure the availability of skilled workers in those circumstances, while also ensuring training is offered to workers affected by structural change. The agency will also advise on the allocation of Commonwealth funding, including through the National Workforce Development Fund. The aim of the agency is to improve long-term workforce planning and development to address skills and labour shortage and to contribute to improvements in industry and workplace productivity.

Our economy is going from strength to strength. Economists across the globe look to our great southern land in awe of our handling of the global financial crisis. Despite all our success and the government's deft stewardship of our great nation's economy we need to continually invest in productivity. This government will not rest on our laurels, and it is through legislation such as this that we will continue to ensure that productivity growth is a priority, and skills development is an important part of such productivity growth. I commend the bill to the Senate.

Sitting suspended from 18:30 to 19:30

Senator McKENZIE (Victoria) (19:30): It gives me great pleasure to speak to the Skills Australia Amendment (Australian Workforce and Productivity Agency) Bill 2012. I am a member of the Senate Education, Employment and Workplace Relations Legislation Committee, which examined this bill. Throughout the inquiry process we heard consistently about the Labor government's record in training measures and how the government has some form over time in constructing an array of policy responses to address our skills needs, including their history of poor policy implementation and constant reallocation of budget funds in helping the Australian workforce develop the skills our economy needs for its future. Actually, more accurately, we heard that the poor policy implementation and constant reallocation of budget funds is a theme that has run right throughout the term of this government. I need look no further than the carbon tax, which we were promised we would not have, the Treasurer overseeing four of the largest deficits in history, and a Prime Minister who is happy to be overseas this week lecturing others on economic responsibility.

Skills Australia, which this legislation deals with, was set up under the Rudd government, the previous iteration of the current Labor government, only in 2008 but is already being superseded by another agency. That begs the question: what was not working? Why did we set something up in 2008 only to be setting up four short years later, with all the inherent costs that come with it, a new agency to address the problem that does not seem to have been addressed over the previous four years? In each budget we see a major redirection of funding from various training initiatives to new initiatives. We hop from one policy solution to another without getting to the nub of the issue: providing real Australians with real job opportunities right across the regions. Anybody who is vaguely interested in real jobs for real people, and in education and training, knows that it takes time to train people in the knowledge and the array of skills that are going to assist our economy and help them make their way through the pipeline of various pathways and training opportunities that we have available in our country. When we keep flip-flopping and changing the process that people must undertake to access work and to obtain the skills they need to access work, we do not assist in getting to the end point where we can in any real way assist the need for skills on the ground. We have a lot of people talking to a lot of organisations in different spaces across the nation, but we do not have too many people actually getting into real jobs on the ground. In fact, the government's training bureaucracy is growing at an extraordinary rate, so somebody is getting the jobs—the bureaucracy within the training sector itself, rather than people on the ground.

Skills Australia, together with the Industry Skills Councils, was tasked with addressing Australia's current and future skills needs. I remember asking a question at estimates about this particular set-up. When we think about future skills needs and my own interest in regional Australia it begs the question. We had had the first iteration of the Murray-Darling Basin draft plan and learnt about its consequent impact on the economic future of the two million people who live in the Murray-Darling Basin and the various industries that the basin supports. In conjunction with what was at the time the newly announced carbon tax, I asked these bodies during an estimates hearing, 'Have you actually factored these new policy initiatives of the Labor government into our future skills needs, particularly in areas across regional Australia?' and the answer was: 'Not really.' For somebody who is passionate about getting economic development happening in the regions, getting local economies diversified and getting young people, particularly young people in regional Australia, into jobs, it was extremely disappointing. But I digress.

How is it that skills shortages across the nation are worsening at a time when economic growth is falling? The same committee that examined this bill, the Senate Education, Employment and Workplace Relations Legislation Committee, is currently conducting an inquiry into agricultural skills needs in regional Australia. Whilst I will not pre-empt any findings of the report, which will be handed down later this week, it has been an interesting process to read through the submissions—which are all available online—from various players in regional Australia around the skills gap, particularly around agricultural education and agribusiness. For instance, last year we heard that in north-west Victoria there were 30 vacancies for agronomists. For those in the chamber who do not know what an agronomist is, it is somebody who goes out and assesses your farm and looks at what you can grow, what your soil is like and what the rainfall is. They do an analysis of what is happening at that geographic location and can advise you of the best way to build your farm business and make it a profitable enterprise.

So there were 30 vacancies for agronomists across the region in north-west Victoria—Hamilton, Horsham, right up to Mildura, down along the Murray and back to places like Swan Hill, and everywhere in between, such as Manangatang. There were 30 vacancies across the region, without one single applicant—not one—to help farmers on the ground to develop up their business case, innovate and diversify their business and maximise the productivity of their particular enterprise. That is the sort of skills shortage we are dealing with in north-west Victoria. So I hope that under Skills Australia this will become one of the priority areas. I was listening to Senator Thistlethwaite earlier when he spoke about what the priority areas would be and how they would be set across the regions, and how this amendment and the organisation that will be set up as a consequence of it will be tasked with addressing those areas. I am hoping that we actually have some people who can help north-west Victoria find an agronomist and address the skills gap that I have in my particular patch.

Similarly, we heard about the research from the Australian Council of Deans of Agriculture which shows that there have been fewer than 700 graduates annually in agricultural and related courses in recent years but that 4,000 positions a year need to be filled in the sector. If there has ever been a skills gap, it sounds like there is one right there, identified by the Australian Council of Deans of Agriculture. I am hoping that this particular body will set as its first priority addressing the skills need of regional Australia and the skills gap we have right across the sector, from highly skilled agricultural scientists and researchers right through to farm labourers, milkers and the like.

These are the sorts of issues that require focus and a real commitment to finding a solution. Tonight some great claims have been made of collaboration between the industry bodies, the training providers themselves and skills councils—which I find quite incredible, given that in consulting around this particular amendment the body that will be set up will have no representation from the training sector. Given that the training sector itself is the conduit, if you like, between industry, the Skills Council and the job on the ground, the training provider's input is particularly important, not only for identifying these skilled job seekers but in terms of how we are actually going to deliver them out in the regions. I think it is particularly important within the regional Australian context, because we do not have a great choice of training providers. If we do not have somebody on that board who actually understands how training is best provided in the regions, where there might only be one or two options available to job seekers, that is problematic in itself.

So we need focus and real commitment to finding solutions to retraining and to supporting those across our community who have been struggling after widespread job cuts and a lack of opportunity in the area. Again, I bring my contribution to this debate back to regional Australia. I think about the job losses in my home state of Victoria, from food processors to the giant Murray Goulburn Co-operative—a huge employer, particularly in the north-central and south of the state. They are significant job losses—300 jobs. And there are also the job losses in manufacturing, which has been a large contributor to our local economies in regional Victoria.

We might ask ourselves why the food processors are shedding jobs and why the manufacturers are shedding jobs. I think we can slate it at the feet of the current government, for a whole array of issues that they refuse to address. This rejigging, I guess you could call it, of Skills Australia is another example of their continually tweaking but not quite delivering the policy on the ground. The government is good at paying lip-service to these types of solutions without any real actions or outcomes.

The bill before us tonight expands the Skills Australia board from seven members to 10. That is always interesting when you are trying to get decisions. If you are trying to get a decision and you want to be flexible and nimble, expanding the size of something might not be the way to do it. But the board has been expanded from seven members to 10 in an effort to increase union and industry representation and supposedly provide a more inclusive approach. However, there is actually no representation on the board from the training industry—and surely the training industry is a stakeholder in this proposal. Whilst the Senate committee recommended that the bill be passed, several people did not actually agree with the current structure—and the coalition senators made a lot of additional comments, which I will address later in my contribution tonight if I have time.

With an expected training shortfall of over 250,000 skilled employees over the next five years, it will be an increased challenge to ensure a match between skills expansion and work opportunities. That means that engagement with the training industry is vital, as I mentioned earlier, and they should be a welcome and active participant at the board table. I do recognise that industry itself is particularly keen to be part of this conversation. Again, I throw back to some of the submissions to the inquiry—its report will be presented later on in the week—that mentioned the need to engage with industry if we are going to get this right. Not only the skills and training sector but also higher education and even secondary educators need to be engaged with industry and enlightening young people as to all the opportunities that are available, particularly within a regional Australia context, and all the great jobs that are out there. 'Get out of the cities and get on board; there are some great opportunities out there'—I think that is the message that industry would like the education sector and also the training sector to hear.

Keeping the training sector away from the AWPA whilst increasing union presence seems like a warped decision-making process to me. I still do not have my head around why, if we are increasing the number of board members from seven to 10, we could not increase it from seven to 11. But I will move on.

In addition to the $558 million for the National Workforce Development Fund, there is a $20 million pool of funds that the AWPA can allocate to unions and employer groups, with no defined purpose for this pool of funds and no criteria for its allocation. I think we have wasted enough money thus far. We need to be ensuring that when we are providing organisations, programs, projects and bodies with the likes of $558 million worth of taxpayers' money that we have some structure and framework around how that money will be spent and the sorts of things we want to target it towards.

It seems there is evidence that purchasing of training by both states and the Commonwealth is fragmenting skills investment and duplicating effort. As an avowed proponent of states' rights, I think we had it pretty well defined. If we go playing in these spaces, we waste a lot of taxpayers' money. Whether we are wasting Victorian taxpayers' money because we are spending it twice in Victoria or Queensland taxpayers' money, as was the evidence the committee received from Queensland taxpayers, I think it is an issue. We all, particularly in the Senate, have to take responsibility for not only looking after the Commonwealth purse but looking after the purse of all those constituents in our respective states.

I just want to read one of the concerns from the Queensland government that was raised during the inquiry on this particular bill. They said:

...[A] unique strength of our national training system is that co-funded training delivery is administered primarily by states and territories. This arrangement supports a cohesive national system and targets the available funding efficiently to complementary local, state and national objectives...A far more effective system would be for the funds to be allocated to the States, with clear performance benchmarks on how the funds were to be invested to support an industry led system.

That sounds like a good idea to me. Unfortunately, it was not one taken up by the government.

As a coalition senator, I support working cooperatively with the states to get the best outcomes through an efficient cross-jurisdictional allocation of resources and an approach to training that ensures industry can get the skills it needs. We are seeing at the moment that the mining industry is conducting quite a comprehensive advertising campaign right throughout the nation to get the types of skills that it needs on the ground. It would be great if this body could work with industry, as it hopes to, but also reconsider and think about adding working very cooperatively with the training providers. I also think that the waste of taxpayers' money needs to be addressed. Setting up some criteria around how it is going to be spent would be beneficial.

I will just read from the coalition senators' additional comments to this inquiry. They said:

Skills Australia was tasked, together with the Industry Skills Councils, with addressing Australia’s current—and future—skills needs.

I am just hoping that we in regional Australia get the skilled graduates we need to get the job done for our national economy.

Senator PRATT (Western Australia) (19:50): I am delighted to speak on this Skills Australia Amendment (Australian Workforce and Productivity Agency) Bill 2012 today because, as we know, this country has been built on the back of good skills and good education. Good economic management is only part of what makes our nation successful; we know that what is really at the heart of that are the skills and talents of Australian people. But we need the right architecture in this country in management, governance, commitment and consultation to get those things right. Part of that is the establishment of the Australian Workforce and Productivity Agency, because our economic productivity goes hand in hand with the skills that Australians have. This bill replaces Skills Australia and broadens its role, putting the needs of Australian industry at its very heart. It is a demonstration of our government's commitment to workforce development and the continued growth of our economy.

I am going to talk tonight about one of the important challenges facing our economy and our society into the 21st century. For our nation to remain at the competitive front that it currently is it means staying ahead in skills and education, and in the development of good skills and education in this country. It means we need industry led workforce strategies. As the Treasurer told the other place only this week, the Australian economy is seen right around the world as a beacon of strength, stability and resilience in the face of deeply troubling economic volatility worldwide. While we know good economic management is a core part of that story, the skills base of this nation is really at the very heart of it. Our economic vital signs are indeed strong. We know that in the last 12 months our GDP has grown by a solid 4.3 per cent. This growth outstrips that of any other major advanced economy. Some 800,000 new jobs have been created in this nation since Labor came to office. In fact, there are now more Australians in paid work than ever before in our nation's history. But we do not want it to be any old paid work; these should be highly skilled and therefore well-paid positions. Interest rates are almost half of what they were when Labor came to office.

So our economy is strong and our fundamentals are right because of our good economic management credentials. But part of what we need to do in working hard to keep it that way, particularly in the face of the economic turmoil that the globe is currently facing, is workforce development and skills development. We need to make sure that all Australians can make the most of the opportunities presented by our economy. We need to make sure that as many Australians as possible can benefit from all the positive things that having access to good quality work brings. We need to make sure that we have a workforce that is educated and skilled and ready to take on the challenges of our changing economy. We want to make sure that our economy remains strong and robust as well as being responsive to what are pretty significant changes both globally and internally in the Australian economy at this time.

We do this in part by looking to the development of our workforce and making sure that it is able to make the transitions that currently confront us. At the heart of this, and at the heart of this bill, is listening to industry and also listening to those people who represent workers—in most instances, unions. The development of skills and education has been a long-held focus of our government, as are those relationships, because we know the challenges that confront us now and will confront us into the future are basically about building the capacity and capability of our workforce to be more productive in the face of a global economic environment in which higher skill levels will be absolutely critical.

In my home state of Western Australia we know this challenge all too well. We know that WA has the lowest unemployment rate around the country. We have an increasing demand for skilled workers, and that demand for skilled workers is continuing to rise in some sectors. A good example of this is the fact that, according to our Minister for Tertiary Education, Skills, Science and Research, Senator Evans, by 2015 the Western Australian skilled construction labour market alone will need some 76,000 workers. But these workers will need skills and qualifications relevant to the industry they work in. Workers will need to have qualifications ranging from certificate I right through to postgraduate qualifications.

One part of our response to this shortage has been to co-fund the Civil Contractors Federation Skill Centre in Jandakot—or the CCF Skill Centre, as it is currently known. As Senator Evans pointed out, CCF is a very clear demonstration of what can be done and what opportunities arise when industry and government do the right thing and work together in partnership. This is where we see real outcomes targeted at industries that are growing and developing. You do this in consultation with the industries that need skills. Most importantly, there are real outcomes for workers so they can get the training, skills and qualifications they need to get the jobs they want. So our government has a commitment to industry and to workers, to providing and facilitating opportunities to develop skills for Australians. But, as we know, the proof of the pudding is in the eating. The government believes the very best way to make sure that employers' workplace training needs are met is to work in partnership with them to deliver that training.

I think the Gillard government's $558 million investment in the National Workforce Development Fund further shows our government's commitment to skilling Australians to meet the demands of the future. The National Workforce Development Fund is going to be administered by the Australian Workforce and Productivity Agency. The agency will allocate industry skills and workforce development funding, and this is important because industry will have a direct advisory role in deciding what is done with the funding. Again, this comes back to making sure that skills development and workforce development meets the needs of industry. We do this by directly involving industry in the decision making. It makes real sense to have industry working in partnership with government on skills development, because we know that a key way of increasing productivity is ensuring that we have a skilled and qualified workforce.

Changes to our economy make it even more important that we work together. Our economy is indeed changing. The mining industry is changing rapidly and we need a workforce to respond. We know that the Australian economy is changing very rapidly and it is not just about the mining boom. For example, we know that retail has been affected by the change in people's spending habits online. We also know that people are spending more money on services and that services are a growing part of the economy. So again our economy is changing, and our government needs to make sure that the jobs and growth happen in all sectors of the economy. Therefore, we need to work together with industry and unions in order to do this.

A new feature of the Australian Workforce and Productivity Agency will be the assessment or provision of research and analysis. That will enable us to know not only that our skills development is in touch with the needs of industry but that there is a proper, forward-looking vision and analysis and that there is not only consultation with individual businesses and industry groups but collaborative decision making and vision about where the economy is likely to move into the future. This is so that government, industry and unions in partnership can better understand and project what skills are going to be needed. Currently, in WA, we are facing a pretty big skills shortage, but we know also that in some regions of Australia there are still unacceptably high levels of unemployment. That includes my home state of Western Australia. We need to be able to better project what skills are needed and where they are needed and to assist people to develop those skills.

We need a country that gives all people a chance to participate in the benefits that economic growth provides. With stronger research and analysis we can work towards avoiding skills shortages and giving people access to opportunities. Skills shortages not only deny those people looking for work opportunities; they also present a risk to the cost base and viability of the development of new construction and mining projects and, indeed, many other industries in Australia. A pretty big example of this is Western Australia's gas pipeline industry, which employs highly skilled welders and boilermakers. Often a pipeline company may have trained staff who then move industries because they are offered twice the pay to work somewhere else. If we are better able to assess, research and analyse skills needs by industry, then we can ensure that the booms and the subsequent gaps in industries are catered for. We need to make sure that all Australians have the opportunity to access good jobs by having the right skill mixes. Research and analysis can really make a difference in this.

The Australian Workforce and Productivity Agency, with its expanded role and board membership, will provide significant benefits for our national economy, for its many industries and for workers, because the core of this is making sure we keep our economy strong not only at a national level but household by household.

Senator ABETZ (Tasmania—Leader of the Opposition in the Senate) (20:02): There is no doubt that the upskilling of the Australian workforce is an honourable and proper pursuit of government. The skilling of the Australian workforce today will determine the productivity of our nation tomorrow. The productivity of our nation tomorrow will determine the wealth and wellbeing of our nation into the future. Can we fund a proper health system? Can we protect our borders? It is to fund those sorts of functions of government that we need a healthy economy. Indeed, can we pay off Greens-Labor's massive debt, now well in excess of $130 billion? It is the biggest debt incurred in the shortest time in Australian history. Make no mistake, the issues that are part and parcel of this bill are of vital importance to Australia's tomorrows and beyond.

What is the government seeking to do with the Skills Australia Amendment (Australian Workforce and Productivity Agency) Bill 2012? The bill will subsume Skills Australia, a bureaucracy established only some three or four years ago during the halcyon days of then newly elected Prime Minister Rudd. Remember when he had to change everything? Of course, he had to meddle in this area as well. Now, three or four years later, the government has come to the realisation that Mr Rudd's good idea at the time is no longer such a good idea. As a result, they have to amend that which they introduced only a few short years ago; and at a cost of about $25 million for a new bureaucracy to undertake the exercise.

The new Australian Workforce and Productivity Agency was announced in the 2011-12 budget. It will be a new agency. The agency will have responsibility for the administration of the $558 million Workforce Development Fund. This fund is available to pay up to half the costs of training for the upskilling of existing workers. The government's contribution equates to about $4,292 per training place, based on their predictions of training 130,000 workers.

Let us stop there for a moment. When you ask about Labor's employment figures and projections, you know they get it wrong, and substantially wrong. It was only two budgets ago that they promised the Australian people that 500,000 new jobs would be created over a two-year period. In the last budget that was reduced to 300,000—a 40 per cent reduction.

Senator Humphries: What a surprise.

Senator ABETZ: And yet, Senator Humphries, we are to believe that the predictions here are going to be honoured—just as we are to believe Labor's promise and prediction to the Australian people that there will be a $1.5 billion surplus or their claim that they have control of our borders. I think the Australian people are learning fast through bitter experience that the predictions and prognoses of this Greens-Labor government are not to be believed. Indeed, it does not matter into what area one looks, one can see the failure not only of the policy settings but then of the follow-up administration by the Greens-Labor government. But, they tell us, they will be seeking to upskill 130,000 workers.

Now, what else are they doing? There is going to be a round of funding of $50 million for three priority areas. There is $15 million for the priority of supporting the resources sector, as well as those sectors where the effects of the resources boom are particularly acute. I think it is a very good initiative to try to assist those sectors so that we need to import fewer workers for our booming resources sector. It is a great initiative, something that the coalition support. But interestingly enough, out of the $50 million, less than one-third is going to be directed to this jobs rich area for which we now have enterprise migration agreements. Don't get me wrong; the coalition support enterprise migration agreements, but only because they are a necessity. We do not support them because we see them as ideal; we support them because we see them as essential to getting Australia's resources projects up and running. But why on earth would you spend less than one-third of the available funding on the most jobs rich area, where there is the greatest likelihood of job opportunities for individuals in the event of their being upskilled? Indeed, the largest amount, $20 million, is going to be spent on support for upskilling and skill-deepening across all sectors of the economy. I dare say that is for those areas that they have no idea about.

Let us have a look at what this bill does. It expands the board of the Australian Workforce and Productivity Agency, compared to that which currently exists, and it adds a new category of board membership. Labor government, a new category of board membership—let me guess: could it be employers? No. Could it be trainers? No. How about trade union bosses? You got it.

Senator Humphries: That is a surprise!

Senator ABETZ: You got it. How surprising! No matter which way this government turns, it will manufacture an excuse to put some union boss or ex union boss onto a board. There are three new board members to be appointed under this new category of employee representative. And, just in case you thought this was going to be a very careful selection process, guess who one of those three new board members is going to be? It is none other than—you see him here, you see him there, you see him everywhere—the National Secretary of the Australian Workers Union. The person who installed Ms Gillard as Prime Minister has, as part of his reward, been given a position on this board. Remember the man who was there on Lateline telling the Australian people that they were going to get new Prime Minister the next day, courtesy of the numbers that he controlled in the Labor Party caucus? He is going to be a beneficiary of this amendment bill through a position on the board.

If you thought, 'One out of three isn't too bad,' guess who else has been appointed? It is none other than Dr John Edwards, the fellow who wrote an academic treatise on Australia's greatest Prime Minister.

Senator Humphries: Bob Menzies?

Senator ABETZ: People listening might be forgiven, Senator Humphries, for thinking that that would be Australia's longest serving Prime Minister, Sir Robert Gordon Menzies, or—

Senator Humphries: John Howard.

Senator ABETZ: Australia's second longest serving Prime Minister, both of them prime ministers who took Australia through a golden era of prosperity and stability. But no. All those people who thought it was Menzies or Howard got it wrong. According to this great academic, Dr John Edwards, a Labor Prime Minister gets that title. With all that expertise in academia that he will bring to the Skills Australia Board, we will undoubtedly have a whole lot of people being gainfully employed!

It is interesting that on this board there is no specific category allocated to providers of training. 'But employees need a special category so we can get Paul Howes on the board.' Employers do not get a look-in. Who gets a look-in? Academics like Dr John Edwards. As for education or training, training does not have to be a part of it, just possible. There is economic and industry representation, and now we have representation of employees. What is the government's argument? They say, 'Oh, "industry" must mean employers.' And of course 'industry' does not mean employers. If that is what the government are actually arguing, let them amend the bill to change 'industry' to 'employers' so there is some equity and fairness. At the end of the day, may I remind Senator Collins, the Labor Party and the Greens, this will be a body that seeks to assist people by upskilling them to gain employment—to gain employment with whom? With employers! They are the people that will ultimately be providing the jobs, yet they are to be discounted. They count for nothing in this class warfare that the Australian Greens and the Australian Labor Party are waging as we speak. Employers are to be absolutely and utterly discounted, but union bosses—you betcha!—have to be there.

Having severely and seriously embarrassed Mr Shorten and the Labor government over their refusal to consider productivity as an important issue in the Fair Work Act review, we now have this new agency, to be called the Australian Workforce and Productivity Agency. I say to the Greens and Labor: this is too little, too late. If you were genuinely concerned about productivity, you would have put it in the terms of reference for the review of the Fair Work Act. Something we know, courtesy of freedom of information requests, is that both the Department of Education, Employment and Workplace Relations and the Department of Finance and Deregulation were deliberately ignored by the government because they did not want to utter the word 'productivity', let alone assess the Fair Work Act against that vital ingredient. I know it is not popular to talk about productivity because the trade union movement will immediately say that productivity means more work for less pay. That is the Labor Party view of the world.

The coalition view of the world is that productivity actually means greater job opportunities, greater wages and greater wealth for the community. We look at expanding the pie by increasing the opportunities and welcoming innovation into our economy, but Mr Shorten could not bring himself to accept the advice of his own department or the Department of Finance and Deregulation to consider productivity. What they have done now is put into the title of the organisation the Australian Workforce and Productivity Agency. The Parliamentary Library provided us with an interesting note in relation to this bill which says, 'It is not clear in either the bill or the explanatory memorandum how this will be achieved.'

Here we have a government yet again realising that they have been snookered. They have to talk about productivity. They have been humiliated on the front pages of newspapers around the country. They have been identified as having ignored departmental advice courtesy of freedom of information. So what do they do. They say, 'We'll put "productivity" into this title,' but they do it in such a rush. Why? Because all they are concerned about is tomorrow's headline. There is no follow-through with the administration. There is no plan as to how this will affect, impact and support productivity, something which I think most Australians now recognise is a vital issue which this country needs to face, to ensure when there are wage increases above and beyond the CPI that there are productivity offsets. Unless we get productivity offsets, we will go down the road of Greece and Spain and some of the other European countries. We can keep promising people increased wages unrelated to productivity but one day we will hit the brick wall, as they have in Greece. I would never want that sort of humiliation to befall this great country Australia. That is why we have to deal with productivity now, while it is still easy to be dealt with, rather than wait another decade when we may find ourselves with some of the diabolical problems that our European friends now find themselves in.

We welcome the fact that Labor have finally been willing to utter the word 'productivity', but as the Parliamentary Library told us it is not exactly clear how productivity will be dealt with in this legislation. I am sure Mr Howes will be able to tell people on this training and productivity board how to get 30 per cent wage rises in the resources sector without any productivity trade-off and then brag about it, as his fellow union bosses do. When that happens, it reverberates throughout the whole economy and the consequences are there for all see.

As is so often the want when you do not have the numbers in a place such as this, the coalition know that we are snookered, that the government will not consider sensible amendments. We will not oppose this bill but I say to the Australian people that there is a better way to deal with issues of Australian workforce and productivity than to expand a board from seven to 10 and whack a union boss onto it. I would have thought the government might have more imagination than that, if they were genuine about developing the Australian workforce and the productivity agenda, which clearly needs to be addressed if we are to secure the future of our country and in particular if we are going to be able to pay off the massive debt legacy which the Green-Labor alliance will be leaving us whenever they are thrown from office.

Also interesting in this bill is a fund of $20 million to be shared equally between the trade union movement and employer organisations. We know the Labor Party love doing this. They will say, 'We've got clean hands; we have equally funded the trade union movement as we have the employer organisations.' Of course there is one big difference: everyone now knows that the Australian Labor Party and the Australian Greens are the beneficiaries of huge amounts of money from trade union organisations for their campaigns but employer organisations such as AiG and ACCI are notoriously known for not making any political donations. The Labor Party pretend that they come to this debate with clean hands, that they will be dealing equally with employer and employee organisations—each gets the same amount—but they know they will be getting a dividend out of that in return whereas the coalition or any other organisation will not be getting any such dividend from employer organisations.

No matter what the government put up, it seems it has to have a union boss on it and the reason for that is clear. In this case, it could not be clearer because the person who will be the beneficiary is the man who put Ms Gillard in the Lodge. The coalition has concerns and reservations about this bill, so ably expressed by Senators Back and McKenzie in their report on this bill. The coalition not be opposing it.

Senator BACK (Western Australia—Deputy Opposition Whip in the Senate) (20:22): Thank you Acting Deputy President Edwards, and I congratulate you on your recent elevation as acting chair. I join with my leader in expressing the sentiment that the only way in which Australia in the future is going to be able to retire the massive debt that is now around our necks is to have as fully employed and as highly skilled a workforce as we possibly can. Regrettably, the legislation before us this evening falls far short in its objective to achieve this. As Senator Abetz has said, the coalition will not oppose this legislation, but I assure you that it needs radical improvement before it is actually to achieve anywhere near the sort of objective that is necessary for this country.

The seeds of failure were sown not in the life of the Gillard government, or even the Rudd government. The seeds of failure were sown way back in the time of the Hon. Kim Beazley Sr. And if that sowing was not sufficiently poor for the Australian workplace and for skills development at that time, it was perpetuated in the time of the Hon. John Dawkins. It is no pleasure for me that both parliamentarians were from Western Australian. There is a simple reason behind this. There was a time when it was recognised in our country that there were those who should aspire to professional qualifications and studies in the universities, and there were those who should aspire to the technical and trades areas because of their levels of interest and perhaps their capacity at the time at which those decisions were made. I am talking now, back in the 1970s and beyond, of young boys, particularly at the age of 15 or 16 years, for whom a year 11-12 education at that time in their lives was not what they were aspiring to. But, unfortunately, where they should have been directed into the technical colleges and into technical and other trades training where they would have been well suited and would have achieved tremendous success and gone on to very successful careers, whether as employers, as business people or as tradesman employees, we had a circumstance, commenced by then Beazley Sr, and perpetuated by Dawkins, in which that was put to one side. We then perforce moved to a scenario in which these students were initially influenced to and then forced to remain on to years 11 and 12 at school and then to aspire to university style education.

What we see in 2012 is the end result of that poor policy decision making. Perversely, what we see is that many of the jobs that should have been occupied by those young people who should have been directed into technical colleges and trades training areas, and would today be undertaking those trades skills and contributing that to our Australian economy, are now in the main being occupied by 457 visa holders, who we have had to bring in from overseas as a result of this vacuum. That is where the fundamental error has taken place.

So what has happened? We have seen burgeoning numbers of students going into the universities and perforce, and of necessity, we have seen a decline in the standards of entry at many of our universities. This has assisted nobody, but particularly those who should never have been pushed or encouraged into, almost forced into, university-level training for degrees for which there is little employment, particularly in the terms of financial and career progression reward, which they may have aspired to had they gone through the alternative path. That is where we need to reverse the trend we see today.

Just in the last seven months we have participated in inquiries in the agriculture and agribusiness higher education and skills training areas. I look forward to presenting to the Senate this week the final report of that inquiry. At the same time the Education, Employment and Workplace Relations References Committee has undertaken an inquiry into the equivalent, if you like: the engineering professional, technical and trades skills areas. I wish to comment on the latter. It was incredibly disturbing to the committee to learn from Engineers Australia that their best guess is a cost to the Australian taxpayer each year at the moment of some $7 billion on infrastructure projects that were poorly described, the tender processes were inadequately undertaken—or successful tenderers selected—the projects were poorly implemented, or they had to go back and rework failed projects. That is a $7 billion a year cost to the Australian taxpayer, since most infrastructure projects are in fact publicly funded.

When I say that we are looking at a wide gap, I refer back to my earlier comments, because the seed for the failure that has reflected itself in that $7 billion was found at a time when people should have been directed into technical training and into skills training but were in fact directed into university-level training. That is the best example I can give, and the most current example I can give you, of the failure of the legislation we see attempting to be addressed in this bill here this evening.

The Skills Australia Amendment (Australian Workforce and Productivity Agency) Bill 2012 is too little, too late, and it fails to address the fundamentals. It fails to address the cause of why we are where we are today. Why is it that a country as wealthy as Australia, a country with the education system that we have, has failed its participants? It has failed its students, it is failing its teachers, it is failing its academics, it is failing industry and it is failing the Australian community and the Australian taxpayer. For the life of me, I cannot see why this should be so.

As a person who has worked in Asia, the Middle East and India over the last 15 to 20 years, I have seen where their deficiencies lie. Their deficiencies are not those of our country. If you drive on a road in India, you can see where their infrastructure failures are. Ours is a country that surely should be a model—it should be right up the top. And yet we unfortunately see, starting with education, with failures of policy, the end result—where we are today.

Only last Wednesday, a week ago tomorrow, I was 600 metres underground at the Tindal gold mine in Coolgardie. There would probably be those who might wonder whether it would be wiser, Senator Farrell—through you, Mr Acting Deputy President—that I never came out of the mine!

Senator Farrell: I would never say that!

The ACTING DEPUTY PRESIDENT ( Senator Edwards ): Order!

Senator BACK: The point I want to make to you, Mr Acting Deputy President, is this—well, two points. First of all, I only went underground because my grandfather had been a miner underground on the Golden Mile in Boulder in the 1920s. I have to say to you I had no desire to go underground, Senator Farrell; nevertheless, I did. Secondly, it was interesting talking to the young mine manager—and I had a keen interest in his sense of occupational health, safety and wellbeing; it was principally my wellbeing that I was most interested in! We were talking about this very issue of skills development in the mining industry. And we would say with pride—of course, from Western Australia—that we are at this time enjoying an opportunity to support the wealth of our nation. I asked this young man, 'How are you going for trained staff?' He said, 'We can't get any.' I asked, 'Why is it that you can't get them—with Coolgardie, Kalgoorlie, the school of mines?' He said, 'We can't get people out of the city; and, if we can get them out of the city, they've got no skills that are employable in this mine.' I said, 'If you actually had these people, could you employ them?' He said, 'We could employ them tomorrow.' I said, 'Where does the fault lie?' He said, 'It lies in skills and trade training.' This is a young fellow with no axe to grind—I don't know what his politics are; I don't care what they are—but he simply said to me that that was the case. I said to him, 'What's the overwhelming nationality of employees on this mine?' He said: 'New Zealanders. We have people from all countries of the world.' I said, 'How many Australians? He said, 'Not many; principally New Zealanders.' I said, 'How do they get a job?' He described to me the situation of people who are actually outside the mine site, seeking work day after day, but because they do not have the necessary, basic skills to be employable, they are not getting this work.

I heard Senator Pratt, a Western Australian senator, also speaking of the need to get these people skilled up.

Senator Polley interjecting—

Senator BACK: But why is it, Senator Polley—through you, Mr Acting Deputy President—that we do not have a circumstance where our young people can be skilled up so that they can be employed? In fact, Senator Polley—through you, Mr Acting Deputy President—they spoke to me of a one-armed truck driver, who was very keen to work on the mine. He felt discriminated against because, as a one-armed truck driver, they could not employ him underground. It was not for his inability to drive a large truck underground; it was the fact that, when they took him underground, and they showed him the shaft—about 1½ metres wide, going up in 25-metre levels some 600 metres—and they said to him, 'Could you ascend those steps in the event of an emergency?' and he himself said, 'No, I could not.' So they employed him above ground, and some five to six years later that same person is still employed.

The point I want to make is that we have failed—we have failed the skilled sector, we have failed the technical sector and we are continuing to fail; and this piece of legislation is not going to address that one little bit. Last week I was in Karratha, in the Pilbara, right beside Dampier, right in the middle of our offshore oil and gas, and our burgeoning iron-ore industry, asking the same question: how are we addressing the need for these wide gaps between skills that are needed and skills that are available? And here, sitting in Canberra tonight, we are not putting policies into place that will actually make these people employable. Is it a disappointment to me that young eastern Australians do not want to leave the east coast to come and take up these jobs? Of course it is. Are the policies right that allow young people who are fit and able and single to travel from where they live to places where they could be employed? No, and it is wrong that those policies are not in place. If a person is married with a family, I can understand that they cannot shift. I had to move, as a kid of 17, to Western Australia from Queensland to go to veterinary school, because I had that engagement, I had the opportunity and I had that ambition. I had to go to Tasmania, Senator Polley—through you, Mr Acting Deputy President—and I left a wife and three children in Western Australia, because I could see the opportunity for work. And if we do not inculcate into our young people the need to work, the desire to work, the pleasure of the ambition of work, of building up skills, then we simply are disinheriting a population of young people into the future. That is why I feel so passionate, that the sorts of issues we are addressing are not going be those that are going to solve these problems.

I was also in the town of Geraldton last week, on our mid-west coast. It is just north of Geraldton that the Oakajee port will be constructed, and it will open up the mid-west of Western Australia to a new type of iron ore, being magnetite, whereas it is hematite that has been the driving force of the iron-ore industry in the Pilbara region. As soon as Oakajee is opened up—as soon as that port is built—we are going to see a wonderful expansion of that whole mid west region. But once again we are going to come back to the sorts of arguments that have torn the Labor Party apart in the last few weeks, arguments based in the tension between employing Australians and having to bring in overseas workers simply because we are not putting the right fundamentals into place to ensure that our young people can gain these skills.

I wish to make another point in relation to this. I made the observation at the beginning that 15-year-old and 16-year-old boys particularly do not often see the benefit of higher education. They are not as mature as girls at the same age. But my own experience in agribusiness and agricultural education from the 1970s through to the 1990s tells me that if you can put in the face of these young people the interest in and the desire for higher education as they develop their own skills they will redevelop the love of learning that was lost in primary school and secondary school and become the most wonderful assets. People who start out at the VET level—the technical skills area—can very quickly, if they have that level of interest, progress through to higher technical and professional level education. Look at the wealth of experience that they will gain from working on the shopfloor right through as they gain those skills.

That is what came out in the engineering skills inquiry that was run by my associate Senator Marshall as the deputy chair and my other colleagues on the Senate Education, Employment and Workplace Relations Committee. That is what we need to be developing in this country. That is the vision that we need for young people in this country. We do not want them sitting around in places where there is no employment. We do not want them sitting around feeling sorry for themselves. We do not want them sitting around because earlier generations of their own family did not work. We have to set the vision for them in a country where there is every opportunity. We have to say to these people, 'This is your future, and you have to be part of the future rather than being part of the problem.'

I do not want to dwell, as others have done and as we all could do all night, on the challenges that we face in this country to get rid of the debt, to pay down the deficit and to start benefitting from the boom. That boom will not be there long into the future. Any of us who get out there and talk with industry and who engage with companies that are working in Australia and other countries of the world—working in Africa, working in South America and other places—have been told that they are positioning themselves very well. Unfortunately, if we do not increase our productivity and our competitiveness, we will be left behind and be a laughingstock; we will be the Europe of the middle of this century; it will be said of us that we let an opportunity slip through our fingers. The Skills Australia Amendment (Australian Workforce and Productivity Agency Bill) 2012 is just a grain of sand on the beach. That beach ought to be the coastline for the future of this country. Regrettably, this bill is not going to turn us into the learning and productive nation that we need to be.

Senator IAN MACDONALD (Queensland) (20:40): It is always a pleasure to follow two speakers who clearly know their subject and who are passionate about training. I congratulate Senator Abetz and Senator Back on their understanding of and their commitment to skills in Australia. I participate in this debate tonight because, coming from North Queensland and Northern Australia, I see the impact upon Australia, Australians and our economy of the lack of skills and the atrocious system for training our young people currently in place under the Gillard government and before that the Rudd government.

I want to share some of the facts that come to me through my office. I am conscious, though, of time and there are a number of other senators who would like to contribute to the debate on the Skills Australia Amendment (Australian Workforce and Productivity Agency) Bill 2012. But because of an unholy alliance between the Greens and the Labor Party, debate on this bill has been curtailed. Right through this year the Greens and the Australian Labor Party have got together and taken from this parliament its ability—its duty—to properly scrutinise legislation that is brought before it. While, as previous speakers from the coalition have indicated, we will not be opposing this bill, there are a number of issues relevant to skills training in Australia which need to be debated and which we would like to engage the Greens and the Australian Labor Party in debate on to challenge some of the ideas that come forward. But, because of this guillotining of debate in this parliament that the Australian Labor Party and the Greens have embarked upon, my time in this debate will be severely curtailed and I am conscious that a number of my colleagues who want to speak will not get the opportunity to do so.

The Howard government recognised the need to get appropriate skills training in Australia. That is why we set up Australian technical colleges. I have to tell you that, while this area of policy is not something with which I am totally familiar, the Australian technical college that was set up in Townsville—where my office is located—was very well supported. The work that it was doing in training people in the skills needed in Australia was first class. It was run by a board of skilled people who had an interest in industry and training and the employment that is needed in the industries that are prevalent in Northern Australia. When the Labor Party came to government in 2007 they annihilated that great model of training, the Australian technical colleges, and that is really one of the causes of the significant problems that we have in finding the right people for the right jobs in Australia at the present time. It is very difficult in Townsville or in Ayr, where I live, to even get your car serviced these days. Why? Because motor mechanics, who used to fix cars of ordinary citizens like myself, have now been lured into the mines with big pay offers. Why are they doing that? Because there are no properly skilled people available to fill all the jobs that are currently available in Australia. Other industries in Northern Australia, such as the sugar industry, are finding it difficult to get skilled people because of this shortage and, regrettably, the current government has done absolutely nothing about it.

This bill is not one that would have been introduced in this form, had the coalition been in government. It does make some amendments to the Skills Australia arrangement, set up by the Rudd Labor government a few short years ago, but it seems already that even the Labor Party understands that Mr Rudd's proposal was basically without merit. So, it is bringing in this new Australian Workforce and Productivity Agency, which is to replace Skills Australia. One of the new roles given to this organisation, over and above what Skills Australia had, is to provide advice to the minister on improving productivity in the Australian workforce. From looking at this, it seems that the thing that this is going to do for employment in Australia is to give Paul Howes—the great backer, the 'clackeur', of the Labor Party, the one who was instrumental in changing the prime ministership from Mr Rudd to Ms Gillard—a job on the board. Perhaps the minister in summing up could tell me just how many jobs Mr Howes does have from this government and what he gets paid for those jobs that he takes on.

We know about the Labor Party's unholy alliance with the union movement in Australia, and we know what the union movement is like when it comes to productivity. You only have to see what has happened in the Health Services Union. Have a look at the productivity gains there. The productivity gains for their officials, including the current member for Dobell in his past role as an official, are there for everyone to see. Certainly, one would wonder what the member for Dobell's productivity was in his role in the Health Services Union. Fair Work Australia—the organisation set up by the Labor government, which seems to be made up by people whose former lives were as trade union officials—has suggested that Mr Thomson used whatever funds of that union he could get his hands on for what could only be described as nefarious ends.

One wonders if what happened in the HSU is unique to that union. My experience is that many unions operate in a way similar to the HSU. Coming from Queensland, I know the inordinate influence the Australian Workers Union has had in that state. We only need to look at the influence of big Bill Ludwig in my state of Queensland and his role in the AWU. One of the results of big Bill Ludwig's influence in Queensland we see in the chamber here every day with his son, Senator Joe Ludwig, who is a minister in this government. Some would wonder whether he would attain the rank of minister were it not for the influence of his father in the AWU. We see that the AWU's tentacles get further and further entwined within the Australian Labor Party government with the appointment under this bill of Mr Paul Howes, the Australian secretary, as I understand it, of the Australian Workers Union. One would wonder what Mr Howes could contribute to the productivity of the workforce, and it is something that the coalition will be keeping a very close eye upon.

There are quite a number of other issues that I did want to raise in relation to this bill. I notice that the budget papers said that the new organisation, the Australian Workforce and Productivity Agency, was to undertake research. But this bill says that the agency would be assessing research, not undertaking research. One wonders where the compatibility lies between those two descriptions of what the agency might do. I have known in the past, and far be it from me to suggest it now, that previous Labor governments have given big grants of money to unions to look into things that are being talked about in this bill—productivity issues. Big grants go to unions to participate almost as contractors in this sort of research and then, lo and behold, the same union makes a donation back to the ALP for its election campaigns. One cannot help but be suspicious and wonder whether there is not a bit of a round-robin here, but the shame of that, of course, is that it is taxpayers' money that first goes to the union in the way of grants and then somehow ends up in a roundabout way back in the pockets of the ALP for election campaigning. I just wonder, and perhaps I am a little bit suspicious, why the budget papers talk about undertaking research whereas the bill says that they will not be doing any undertaking of research and they will just be assessing research that I assume would be produced by others.

There are a lot of other things that I would like to say about this bill but I am conscious that my colleagues also want to make a contribution, so I will leave my contribution at that point while letting the Labor Party know that we will be very closely assessing the way that this bill works out in practice. We will certainly be closely watching the work of the increased board of Skills Australia, now called the Australian Workforce and Productivity Agency, and we will be wanting to see how that board—and the agency—operates in the way that it is required to as in this bill before the parliament. I conclude my remarks there because of the guillotine and because I am aware that my colleagues are very keen to also make a contribution on this bill.

Senator HUMPHRIES (Australian Capital Territory) (20:53): I want to contribute on the Skills Australia Amendment (Australian Workforce and Productivity Agency) Bill 2012 although there is not much opportunity to do so because, as Senator Macdonald has pointed out, this important issue has to be put to an early bed because the government believes it is more important to get through its business in a certain time frame than to allow the parliament to do its job. However, I want to make a contribution to this debate that reflects on the importance of ensuring that as a nation we have a better focus on productivity than has been the case in recent days.

I recall sitting in this chamber in the last few years of the Howard government when we had a very strong economy and very strong growth. We had a budget that was in surplus, we had virtually no debt—debt was being eliminated or had been eliminated—we saw low interest rates, we saw low unemployment and a lot was going very well for the Australian community, particularly for the Australian worker. We were coming to the point where real wages had risen during the life of the Howard government by something like 20 per cent. Labor, the opposition as it then was on this side of the chamber, wanted to criticise the performance of the Howard government and it latched on to the question of productivity because it was able to discover, amidst all that good news, that there was a little bit of a dark lining on the very white cloud, which was that productivity was not improving as much as the rest of the Australian economy. They latched onto that and made a big issue of that before the 2007 election.

So one might expect that in the 4½ years or so in which the Labor Party has held the Treasury benches there would have been some very significant progress on the question of the productivity of the Australian economy, because there has not been much progress on things like unemployment, bringing debt down or having surplus budgets. So you might expect that in this area, which had been such an issue, there might have been some progress. Yet have we discovered, not long ago, that under this government Australian productivity has fallen. It has fallen, not gone up. It has not even been sustained at the same level; it has actually fallen. Despite a bevy of reports from the Productivity Commission on ways in which the Australian economy might be made more productive, that advice has in large part been ignored by this government, with the result that productivity is indeed falling. It takes a special level of ineptitude to have an economy which is at least in part so strong as this one is, with so many opportunities existing to do things better, and to find that the productivity of the Australian economy has fallen.

And it is not surprising when we see the way in which this government has handled the issues surrounding productivity. It has wound back flexibility in the workplace. Those opposite should not jump up with a little scare campaign about Work Choices—I am not arguing for a return to Work Choices—but you backed away from the idea of flexibility in the workplace, and that is very much at the heart of how you get more productivity. You have wiped that off the slate: 'We're not interested in that.' You backed away from promises to increase training at school level. What happened to the 2,650 trade training centres in Australian secondary schools you promised at the 2007 election? What happened to them? They went the same way as the 37 GP superclinics and the 260 Australian childcare centres— all washed away in the tide of history and all promises broken by the Labor Party. But those promises about the trade training centres were about in part skills and productivity and, of course, they have gone; they have disappeared.

I think that is why I feel so suspicious about the creation of the Australian Workforce and Productivity Agency. We were told very much in the lifetime of many people in this chamber that we were going to have a wonderful new world with respect to skills by virtue of Skills Australia being set up. That is now being swept aside. That is a promise that you can afford to have broken, because you have got another promise to make: you are now going to have an Australian workforce and productivity agency which is supposedly going to fix this problem and there are going to be many millions of dollars poured into that and that is going to solve the problem that has not been solved to date. Well, you can forgive me for being a little bit suspicious and cynical about the approach that this government is taking. There is a hollowness about so much that this government says in these areas that one has to be very suspicious.

We have a new body set up which mentions the word 'productivity'. Why? Because the government is failing on that front, it needs to do something on that front and it needs to appear to be acting on the question of productivity. It has got a lot of money being poured into it. That is the classic Labor response to this issue: pile the money in—of course, mostly borrowed money. And it has got a board which is well salted with trade union friends more noted for their factional loyalty to the Labor Party than for their skills in things like productivity and we have a promise that this is going to fix the question of skills take-up and productivity in the Australian workforce. I am sorry, but I do not believe it. I see more of the rubbish that we have had from this government in these areas, and the structure of this legislation only lends itself to that kind of cynicism. As Senator Macdonald pointed out, the budget papers promise that this new Australian Workforce and Productivity Agency would undertake research, that it will have the capacity to undertake research. What research is it going to do? Apparently now none, according to the bill. It is going to only be assessing research.

The ACTING DEPUTY PRESIDENT ( Senator Parry ): Order! The time allocated for the consideration of this bill has now expired. The question is that this bill be now read a second time.

Question agreed to.

Bill read a second time.

The ACTING DEPUTY PRESIDENT ( Senator Parry ) (21:00): The question now is that the remaining stages of the bill be agreed to and this bill be now passed.

Question agreed to.

Bill read a third time.