Senator McGRATH (Queensland) (10:02): It is a pleasure to be able to continue my remarks in relation to the Building and Construction Industry (Improving Productivity) Bill 2013 and related bill. I believe there is a pressing need to fix the current legislation: to re-establish the ABCC so as to re-establish meaningful penalties that can actually deter people considering compliance with the law as optional and stop them from repeatedly breaking the law as it suits them; to re-establish an effective building code to ensure contractors that want to do taxpayer funded work strictly meet all of their legal obligations, including laws dealing with worker entitlements, workplace safety and migration laws; to ensure antiquated practices that only add cost and delay are avoided on taxpayer funded projects; and to remove the absurd restriction on the regulator's ability to enforce the law in the public interest where parties reach a private settlement in their own commercial interests. This is a Labor and Greens imposed restriction that does not apply to any other Commonwealth regulator.

The building and construction industry is very important for the Australian economy not only because of the number of people it employs and the number of families it supports but also because it represents approximately eight per cent of GDP, which is similar to the contribution made by the mining industry. The building and construction industry can be an important source of sustainable, high-paying jobs. That is why it is so important to ensure the rule of law is respected by those in the construction industry, and that thuggery, intimidation and coercion are effectively dealt with. When projects are delivered on time and on budget, there is more money for more projects and that benefits the construction industry with not only more work and jobs but it also, more importantly, provides a better return for the Australian economy and the Australian consumer. The taxpayer and the consumer ultimately pay for construction delays and budget blow-outs.

The bill to establish the Australian Building and Construction Commission will re-establish a genuinely strong watchdog to maintain the rule of law and to protect workers and constructors. A re-established Australian Building and Construction Commission will improve productivity on building sites and construction projects, whether on shore or offshore. The re-establishment of the Australian Building and Construction Commission will bring to the industry confidence that the rule of law will be applied. This will encourage further investment and provide more jobs and greater prosperity for workers and the economy. The bill will prohibit unlawful industrial action, unlawful picketing and coercion and discrimination.

Labor experimented with a weaker regulator when it abolished the Australian Building and Construction Commission, strung one hand behind the regulator's back, slashed the regulator's budget by a third, reduced its staff complement by a third, and, alarmingly, reduced the applicable penalties for wrongdoing by two thirds.

A key feature of the government's legislation to re-establish the Australian Building and Construction Commission will see a return of penalties for unlawful conduct that are high enough to actually deter people who repeatedly break the law to suit their industrial agendas. For many years, it has unfortunately been only too clear that the commercial building and construction sector provides the worst examples of industrial unlawfulness. In 2003 the Cole royal commission examined the construction industry and noted that it is characterised by unlawful conduct, and concluded:

These findings demonstrate an industry which departs from the standards of commercial and industrial conduct exhibited in the rest of the Australian economy. They mark the industry as singular.

And:

… the rule of law has little or no currency in the building and construction industry in Western Australia … The ... industry ... is marred by unlawful and inappropriate conduct. Fear, intimidation and coercion are commonplace. Contractors, subcontractors and workers face this culture continuously.

The royal commission findings lifted the veil on what everyone in the industry had known for years. Previous governments had been unwilling or too intimidated to tackle it. The Howard government was prepared to step in and make the tough decisions required to clean up the sector. The establishment of the Australian Building and Construction Commission in 2005 provided a genuinely strong watchdog and dissolved the 1970s-style practices that plagued the industry. It was a strong, specialist regulator that enforced the rule of law applying to the building and construction sector. Even Labor reluctantly acknowledged the need for a regulator and retained the Australian Building and Construction Commission, with its coercive powers, for its first term of government. It then, regrettably, abolished the ABCC and replaced it with a weak imitation with a slashed budget.

The establishment of the Australian Building and Construction Commission saw a decrease in lawlessness. Site managers reported that for the first time in years they could focus on building rather than industrial relations. Over its term in government, Labor progressively dismantled the powers of the Australian Building and Construction Commission and abolished it in 2012. Almost immediately, as night follows day. militancy and violence was demonstrated on the streets of Melbourne with the CFMEU shutting down part of the Melbourne CBD in its aggressive protest at the Grocon Myer Emporium construction site. In that dispute workers on the site who were being blockaded purchased an advertisement in the Herald Sun with an open letter to their own union bosses asking for the blockades to stop and to be given access to their own workplace. Images of these protests were seen on television screens across the world. What message did that send to national and international companies about investing in building construction projects in Melbourne or Australia? In what was unfortunately only too characteristic of the approach in the building and construction industry, on 4 September 2012 in that same dispute which shut down part of the Melbourne CBD, senior CFMEU official Derek Christopher addressed a crowd of over 1,000 protestors on Lonsdale Street with a megaphone. With fewer than 100 police officers present, he said:

There’s 11,000 coppers in the country or in Victoria and there’s 30,000 members of the CFMEU and greater among the other unions when we call on their support, so we’re up around the 50,000 mark, so bring it on we’re ready to rumble.

The approach by this union thug epitomizes the approach taken to the application of the rule of law in the industry by the CFMEU, amongst others. The current industry regulator advises that the spread of unlawfulness in the industry was a feature of Victoria and Western Australia and has now spread to Queensland and South Australia.

The previous government was well aware of this type of behaviour in the building and construction industry, and so was understandably reluctant to abolish the Australian Building and Construction Commission despite the strong union pressure. It contracted Justice Murray Wilcox QC to review the industry to buy time. Justice Wilcox recognised the need for and the benefit provided by the Australian Building and Construction Commission, stating in his report:

… the ABCC's work is not yet done.

and that it would be unfortunate if the ABCC's replacement body led to a reversal of the progress that had been made. But that is exactly what we have seen.

The principal purpose of penalties in the legislation is as a deterrent. As the royal commission into trade union governance and corruption concluded in its interim report, there is a culture of wilful defiance of the law which appears to lie at the core of the CFMEU. Unions began budgeting for penalties for breaking industrial laws and treated penalties simply as a cost of doing business. The Federal Court noted that comments such as, 'The last time it cost us'—I will say 'a bucketload' of money; I do not want to swear!—'and it is going to be expensive, but our fighting fund will fix it'. This is evidence of an attitude on the part of branch officials that the risk of the imposition of significant pecuniary penalties will not be allowed to act as a constraint on unlawful activity which they consider to be warranted.

In recent findings against the CFMEU for contempt of the Supreme Court orders in Victoria—and this was for shutting down parts of the Melbourne CBD—the Supreme Court said that the imposition of a penalty for contempt of court should not be viewed as simply an anticipated cost of industrial action. Few things could be more destructive to the authority of the court and to the rule of law then the idea that fines or similar punishments akin to a tax that, once budgeted for, enable the use of unlawful conduct to achieve industrial outcomes.

When Labor abolished the Australian Building and Construction Commission, it slashed applicable penalties by two-thirds. This only made it cheaper for the CFMEU to continue its business model of breaking the law. Even when maximum penalties were still at a meaningful level, the Federal Court said that the CFMEU had a 'deplorable record' of contraventions, that the contraventions were significant and that substantial penalties for past misconduct had not served to prevent repetition.

It was a few months ago that the Federal Court handed down yet another penalty, finding against the CFMEU, noting that the CFMEU's continued willingness to engage in contravening conduct supports the view that earlier penalties, some of them severe, had not had the deterrent effect.

The court went on to speak, in relation to the CFMEU's contravention, about the deplorable attitude on the part of the CFMEU to its legal obligations and to the statutory process which govern relations between unions and employers in this country, and that this ongoing willingness to engage in contravening conduct must weigh heavily when the need for both specific and general deterrence is brought to account.

The court also went on to say that, not for the first time, the CFMEU sought to impose its will by means of threats and coercion against employers. Its approach was one of entitlement. It was free, despite legal constraint, to deploy its considerable resources in order to achieve its industrial objectives. The concept of the rule of law was anathema to it.

This is not some historical exercise; this is a real and current problem. We must not forget that the maximum penalties are reserved for the worst offenders and repeated offences. It is extremely unlikely that individuals are penalised anywhere near the maximum for first offences.

In what was the last of the Australian Building and Construction Commission's legacy cases—meaning that it was a last case before the maximum penalty was cut by two-thirds—the CFMEU was found to have broken the law when it shut down work on a Queensland government housing project, which would have provided housing for the long-term homeless. The CFMEU proceeded to use cars to block access to the site and abused any worker who tried to enter the site.

Workers were repeatedly called 'scabs, parasites and dogs' plus a smattering of unparliamentary expletives. In fact one CFMEU official, Paul Cradden, approached one of the site workers and flooded him with aggressive attacks, saying to him, 'Hey scabby, gay boy, gay boy, gay boy, scabby. The CFMEU officials also made sure to let people know who they were dealing with. The court's decision records that while people outside the main gate were yelling 'scum' and 'scab', a CFMEU official, Mr Miles, said to a group of contractors words to the effect of, 'You've all got a long time left in the industry and we can influence your future jobs.' The clear implication was: 'Do not cross the CFMEU. We will ruin you, your business and your livelihoods.'

The CFMEU think they are a law unto themselves. We cannot in this country allow this state of affairs to continue in this industry and assist the kind of behaviour that the Labor Party or the Greens, who continue to accept substantial donations of support from the union, condone. The Federal Court certainly did not. It fined the CFMEU and a string of its officials a total of $545,000 for their offences, but, despite such a penalty, the CFMEU has not been deterred and it continues to break the law as and when suits it. The point is this: if the former Australian Building and Construction Commission's penalties, which were larger, were only partially successful in deterring the repeated breaking of the law, what did Labor and the Greens really expect would happen when they slashed the maximum penalty for doing the wrong thing by two-thirds? We will no longer see the penalties of this magnitude because the penalty for wrongdoing was substantially cut.

Justice Logan called out the CFMEU for its outrageous disregard of the law, and reiterated the comments of other judges and Royal Commissioner Cole in condemning the union's perverse attitude to the law. In light of this, it is absolutely disingenuous to see the CFMEU feigning outrage at the government's efforts to restore lawfulness to the construction industry through the re-establishment of the Australian Building and Construction Commission. The CFMEU pretends that the construction industry does not require special regulation, when it is precisely because of the CFMEU's disregard for the rule of law that special legislation is necessary.

If you need any further example, who can forget what John Setka, now the CFMEU Victorian state secretary, said to a crowd of 100 people outside the Australian Building and Construction Commission offices? Directing his comments to the public servants working at the Australian Building and Construction Commission, this CFMEU official said:

And just for the task force, or ‘Rats’, ‘Dogs’ whatever they are—

he is referring to the inspectors, the public servants, employed by the Australian Building and Construction Commission—

just to remember one thing, when this is all over and they don’t exist anymore, they’ve got to work elsewhere and we will remember them 'cause we know every—

they really do swear a lot these union officials—

one of them; We'll never forget 'em.

Hindering regulatory powers is something that the CFMEU prides itself on. The former Labor government gave into unions demands and abolished the Australian Building and Construction Commission, replacing it with a severely curtailed version of the regulator in the Fair Work building industry inspectorate. As well as this inspectorate having its power substantially curtailed, it faced significant reductions in funding and cuts to staffing of around 30 per cent. In closing, I totally support this bill and the reintroduction of the Australian Building and Construction Commission. It is certainly needed so that we can cut down on the misbehaviour and the bad behaviour of the CFMEU.

Senator SINGH (Tasmania) (10:18): I rise to speak on the Building and Construction Industry (Improving Productivity) Bill 2013 in the hope that it does not pass this Senate and also to make it clear why Labor opposes this legislation, which of course forces a return to the draconian Australian Building and Construction Commission. This bill is seeking to re-establish the Australian Building and Construction Commission, which was created in 2005 theoretically to investigate breaches of federal industrial law in the building and construction industry. In reality, it was then something far more pernicious and its re-establishment threatens no less than that.

The ABCC's proposed powers are extreme, to say the least, and undermine this country's very civil liberties. But before I continue, I must bring to the Senate's attention the consistent ideological attack of the Abbott government upon the working people of Australia, which really goes to the foundation of this bill. The attack by the conservative Abbott government on working people, who organise together to protect their rights, is explicit both in this bill and in the establishment of the biased, prejudicial and political witch-hunt this government calls a royal commission.

I will not reflect upon the character of anyone involved in the royal commission, although whether the commissioner can continue in his role due to the clear present bias and the political nature of his appointment is an issue worth debating. Instead, I want to draw to the Senate's attention the foundational common law case Crown and Sussex Justices, ex parte McCarthy from1924 in which it was found:

… that justice should not only be done, but should manifestly and undoubtedly be seen to be done.

And that:

Nothing is to be done which creates even a suspicion that there has been an improper interference with the course of justice.

The simple facts of this case are that Justice Dyson Heydon, whilst royal commissioner of an $80 million quasi-judicial inquiry into unions and Labor prime ministers, accepted an invitation to speak at a Liberal Party fundraiser. He has created at least the appearance of bias and, even to the most unreasonable person on the street, he has raised a suspicion that his professional judgement might be unduly influenced.

The Prime Minister has described Justice Heydon as the most distinguished person in the legal profession. If that is so, I then have no doubt that a man of Justice Heydon's distinguished legal experience and expertise knows that he has no other option but to recuse himself from the commission. I think that the commissioner really needs to consider whether his ongoing role in the royal commission is tenable.

Justice, however, will not be accorded to workers who are brought before the reconstituted ABCC when it uses its reconstituted powers under this bill to compel workers to suffer secret interviews without legal representation and under the threat of imprisonment if they resists coercion. These powers are excessive, undemocratic and unwarranted. It sounds like something directly out of the Stasi handbook of the 1950s. This bill extends the reach of the ABCC into picketing, offshore construction and the transport and supply of goods on building sites. The new powers are aimed squarely at stopping pickets and include a reverse onus that will require individuals to prove they were not motivated by industrial objectives to escape the mere $34,000 penalty that will be put upon them if they were.

The case for the reintroduction of the ABCC has not been made. We know that Labor's Fair Work Building and Construction agency already has sufficient powers to deal with any unlawful behaviour in the industry. The ABCC is based on flawed modelling and its proposed powers, as I said, are extreme and unnecessary and compromise our civil liberties.

Further, I find that this particular legislation is demonising and discriminating against workers in the construction industry—against a particular group of workers. It is subjecting them to harsher laws than any other workers in this country. No other workers are being subjected to this level of demonising and discriminatory law changes. The Abbott government's determination to take Australia back to the ABCC shows a return to something very similar, in my belief, to Work Choices, which, as we know, lurks just below the surface of this government.

As I said, the Fair Work Building and Construction agency established by Labor already has sufficient powers to deal with any unlawful behaviour in the industry. It has a full suite of appropriate investigation and prosecution powers to deal with any unlawful behaviour, whether by employers, employees, unions or contractors. Fair Work Building and Construction is undertaking more investigations, concluding more investigations, getting more matters to court faster and recovering more money for workers in the industry. Indeed, Fair Work Building and Construction has already recovered more than $2 million in unpaid wages and entitlements for more than 1,500 workers. Those were the sorts of breaches that the ABCC never focused upon. It was quite happy for workers to miss out on their fair share of wages and conditions. Those are the sorts of breaches which need to be readily investigated for a fair and transparent industry.

ABS data shows industrial disputation in the building and construction industry is, on average, less than one fifth the rate seen under the previous coalition government. Labour productivity has increased over the last 10 quarters and is almost three times higher, on average, under Fair Work than under Work Choices. Under Fair Work, the rates of industrial disputes are around one-third the rate we saw under the previous coalition government, yet the conservative Abbott government does not want to listen to any of that good news for workers and for employers. The government is not interested in giving workers a fair go. The government is only interested in systematically pursuing Australian workers through draconian laws like this.

Labor's dissenting report to this bill made very clear that there are very serious concerns of the human rights impact of this legislation. In fact, Labor believes that this bill represents a direct attack on the common law rights and privileges which form the cornerstone of our democratic and legal systems. This legislation seeks to demonise an industry, treat its workers as criminals and remove their rights in law. Not only will Labor oppose this bill but we will fight the Abbott government's ideological war on working Australians every single step of the way, including in the building and construction industry. We will continue to fight so that all working Australians will receive the fair living wage they deserve for the hard work they do in all industries and we will also ensure that the rights of all Australians are given equal respect under the law. It is for these reasons that Labor opposes this draconian legislation which tries to return the ABCC into law. It is my hope that it does not pass the Senate. It is my hope, very much, that those in the Senate, particularly those on the crossbenches, see sense to the threat of this law to our civil liberties, to the human rights of workers and to the demonising of a particular set of workers in this country and uphold the Australian ethos of the fair go for all.

Senator DAY (South Australia) (10:27): I rise today to talk about the Building and Construction Industry (Improving Productivity) Bill 2013 and related bills. It is a subject that I know a little bit about because I have worked in the building and construction industry for nearly 40 years. However, a definite split has developed over the years between the commercial construction industry on the one hand and the housing construction industry on the other. The glaring difference between these two construction environments is that you do not get the kind of criminal conduct on housing construction sites that you do on commercial construction sites. So what is the difference? Why do we not have the criminal behaviour, or anything like it, at home-building sites in the housing industry? The answer is: we do not see the CFMEU and its members on housing construction sites. We are having this debate about reinstating the Australian Building and Construction Commission. It is because the ABCC is the only body capable of keeping the CFMEU in check on commercial building sites.

Those who have been listening carefully to my questions to various ministers in this place will know that I have been advocating for unemployed people to be able to work on terms and conditions which suit them. The unemployed are presently trapped in a workplace regulation prison. They cannot escape because there are so many patronising organisations that say, 'We have to lock you up in this workplace regulation prison for your own good, because you might be exploited if we let you out.' Yet, as I have mentioned in examples before, nobody stops young people from travelling to some of the most dangerous places on earth where they could be taken hostage or harmed. Yes, the department of foreign affairs issues travel warnings about some countries, but it ultimately respects the rights of people to go wherever they like in the world and take whatever risks they like. There is no travel prison regulating where people can travel. For some reason, we respect an Australian citizen's inalienable right to travel and expose themselves to potentially life-threatening risk, but if they want to go and work somewhere then they are captive to over 2,000 pages of workplace regulations. In some circumstances, the work they might wish to do on terms and conditions which suit them is illegal for them to engage in. We hear the term 'paternalism' used in this place and throughout history, but the epitome of paternalism is the workplace regulation prison.

I challenge one person arguing in favour of workplace regulation to say that they have never taken the cheapest quote to have a job done. Whether it is something you need fixed at home, the servicing of your car or which hairdresser you go to, it is human nature to shop around or to change service providers because you have found a better deal. This is not considered criminal behaviour when you choose the cheapest quote, yet somehow when it comes to labour in other contexts there are regulations to say that the minimum price, for example, for working on a weekend is $40 an hour. But please spare a thought for the thousands of unemployed who are struggling on $5 an hour. These people are ready, willing and able to work for $20 an hour but it is against the law. The law says, 'No, cafe owners and others must pay $40 an hour'. But the cafe owners and others cannot afford $40 an hour, so they do not open their doors. Everyone loses: the unemployed person stays on the dole, the cafe owner cannot open and the customers cannot buy what they want. It is immoral to deny people the right to work and support their families. The contrary view on workplace regulation is this view that you simply must lock up the unemployed in this prison to protect themselves from exploitation. It is the very reason that these powerful organisations are a law unto themselves—but I digress.

Returning to the dire state of the commercial construction industry, what we are seeing here is leadership failure at every level. At the last count there were something like 80 different definitions of leadership. My favourite definition of leadership is: that which you will not tolerate. What is it that you will not tolerate? That determines what kind of a leader you are. What we are seeing in the commercial construction industry is a total failure of leadership. Let us look at some of them. The previous Labor government deliberately removed any notion that it was necessary to constrain criminal behaviour by certain unions. They were prepared to tolerate criminal behaviour—a failure. The police have failed to uphold the law in favour of so-called keeping the peace. They will tolerate criminal behaviour if it means keeping the peace—another failure of leadership. The courts have failed to uphold justice. In some cases those who have suffered unlawful behaviour wait years and years for justice. As we know, justice delayed is justice denied, and now we see in this bill the government's desire to increase penalties out of frustration at the relatively low penalties and, therefore, the low economic incentive to promote lawful behaviour. The judicial system: another failure of leadership.

When you have these growing power bases developing on construction sites, you get ridiculous situations such as those this bill seeks to rectify, including: contractors being forced to employ a non-working shop steward; situations where, if one worker is offered overtime, all workers have to be offered overtime, even if there is not enough work; and trade contractors being required to provide certain conditions to their workers even if they already have lawful arrangements with them. This bill would hope to address these and other allegations of standover tactics, intimidation and violence.

The Independent Contractors Association of Australia asserts in its submission to the Victorian CCCU inquiry that independent contractors working on the Westgate Bridge upgrade in 2009-10 were taunted regularly with 'It's a long way to fall, mate' because they were not members of the CFMEU. This is outrageous. Never in 40 years of working on housing construction sites have I heard someone saying to a fellow construction worker, 'It's a long way to fall, mate.' The ICA has posted footage of the violence and foul verbal abuse that workers were subjected to entering a worksite. The ICA went on to assert that, when the ABCC was in operation before 2010, the ABCC 'in large measure curtailed a good deal of the abuse and harassment in the Victorian construction industry, although'—sadly—'it did not eliminate it'.

The Greens talk at times about a 'social licence to operate'. In my opinion, the CFMEU does not even have a social licence to exist, let alone operate. Senator Lambie has called for the CFMEU to be deregulated. In his book Blink, Malcolm Gladwell talked about 'thin slicing'. Blink is the book and I recommend it. Weighing up situations in the blink of an eye. Looking for the shibboleths, the dead giveaways. For those who are not familiar with the Old Testament, 'shibboleth' is Hebrew for stream. Jephthah and Gilead fought Ephraimites and captured the Jordan crossing. To distinguish who was friend or foe, they had everyone say the word 'shibboleth'. If they could not pronounce is correctly, they knew they were the enemy. Hence 'shibboleth' became an identifier or a dead giveaway. It would be like hearing someone say, 'Where did I put my jandals?' Straightaway you would know they are a New Zealander. It is a shibboleth. Gladwell calls it 'thin slicing'. He says you can take a big salami and, no matter how thinly you slice that salami, everything you want to know about the whole salami is in that thin slice.

I note the CFMEU gave over $100,000 to the Greens before the last election. How morally bankrupt can you get when you oppose this legislation and you have received money from the CFMEU. The Greens, the party that pretends to be a party of ethics and morality, gladly takes money from the CFMEU. There's your 'blink' moment, your 'thin slice' of the Greens. The Greens shibboleth. Everything you want to know about them is right there.

By contrast, look at the Shop, Distributive and Allied Employees Association. I have never once heard allegations that they have engaged in criminal behaviour or provided funding to the Greens. The Shoppies have more in common with Family First than the Greens. The Independent Contractors Association says in the submission I mentioned earlier that the previous federal construction code changed the dynamic of reducing the violence, harassment and intimidation on construction sites. It did so because:

… any construction business that was involved in or permitted anti-competitive industrial relations activity (including violence and intimidation) found itself excluded from government work. This changed the commercial ‘reward’ system because the financial benefits from violence and intimidation were largely removed. Unfortunately this was undone with the closing down of the ABCC.

This bill creates the capacity for a new building code. I have heard about the huge cost blow-outs, enabled by the existing code. In my home state of South Australia the state Labor government is building a brand-new hospital, recently built a health and medical research institute, made a major expansion of the grandstands at Adelaide Oval and is, with the help of the Commonwealth, about to commence major and long-overdue roadworks. We have had to fight hard to get Commonwealth funding to support those projects and yet where will a significant percentage of that federal taxpayer money go? It will go into supporting the inefficiencies provided by the current building code.

Look at the stadium construction project my Western Australian colleagues have happening in their capital and at the new footbridge they think will be better than Adelaide's new footbridge. Indeed, just on Thursday TheFinancial Reviewreported that 76 workers at the new children's hospital project in Perth were found, by the Federal Court, to have engaged in unlawful industrial action—on a children's hospital project! I see Senator Smith nodding. This happened in his home state. If taxpayers in the states that we senators here represent want value for state and federal taxpayer money we ought to demand that building codes support efficient civil construction projects—and that is not to mention private projects like the Olympic Dam expansion and other mining opportunities. When you have major inefficiencies, such as major work stoppages on questionable grounds, it is proper for the government to look at how we can ensure that those trying to create jobs and improve our economic situation can get on with the job to deliver projects on time and on budget. Let me quote from a report by Deloitte Access Economics, of last year, submitted to the Productivity Commission:

It is also worth highlighting that the rate of engineering construction cost increase has been notably higher for public sector projects … than private sector projects. Given the significant demand seen for resources investment, and the combination of a rising $A and high import component for resources projects … costs of imported materials … one might have thought this would be the other way around.

A loss of competitiveness in delivering infrastructure projects creates difficulties for the Australian economy …

I have heard allegations being made in this place about behaviour on construction sites and towards Fair Work Building and Construction officials which make one's hair curl. They are appalling allegations. I was willing to support the continuation of the powers needed by Fair Work Building and Construction during a previous session of the parliament when they were about to expire, because I believed there were legitimate concerns that needed investigation. For those same reasons and the factors I have outlined, whilst I am not generally in favour of expanding government power, the situation in the commercial construction industry has become so bad that we need to restore the ABCC. I support the bill.

Senator SMITH (Western Australia) (10:43): Thank you very much for another very well informed and considered contribution to these matters, Senator Day. Those senators on the other side of the chamber would be well served if they paid more attention to contributions like Senator Day's. I commend him for that very powerful presentation.

It is also my pleasure to make a contribution this morning in support of the Building and Construction Industry (Improving Productivity) Bill 2013 and related bill, which should be fairly uncontroversial in the sense that all the bill is doing is making sure workers in the construction sector go about their jobs each day without the fear of being harassed, intimidated or otherwise put upon by thugs within the Construction, Forestry, Mining and Energy Union.

But before I proceed I just want to comment briefly on a contribution I heard from Senator Singh. If I heard her correctly she seems to take exception to the reverse onus of proof which is contained in this bill. I would just like to point out to Senator Singh and to other Labor and Greens senators who might make a contribution to this that such a provision is taken, pretty much cut and pasted I dare say, from the Fair Work Act that was passed by the former Labor government—cut and pasted from the Fair Work Act passed by the former Labor government! So, I think it is beholden on each and every speaker following on from me on the Labor side and on the Greens side to first and foremost answer these questions. What is their position? Is it consistent with the previous position? Has it changed from the previous position? And why might that be the case? So, that is a challenge for subsequent speakers.

Of course, the Labor Party cannot survive without the rivers of cash that flow to it from the union movement in this country. This point was demonstrated ably by Senator Day. And so it is that in the course of the debate on this legislation both here and in the other place, we have had the sorry sight of Labor members and senators getting to their feet and making excuses for bullying, intimidation and violent behaviour on construction and worksites across our country—indeed, even in my own state. I will come to that briefly.

It is really quite sad to see the once-great Labor Party reduced to such a state, but there we have it. I will come to some specific examples of the sort of conduct that Labor seeks to excuse in a brief moment. This legislation, however, goes to the heart of dealing with something that the Intergenerational report released earlier this year makes clear we must deal with, and that is improving productivity. We have heard, and we will no doubt continue to hear, histrionics from Labor senators about the provisions in this legislation. But desperately as they might wish otherwise, this is not a part of some grand conspiracy. This legislation is doing no more than what the coalition said we would do in the lead-up to the 2013 federal election.

This bill will finally re-establish the Australian Building and Construction Commission, a genuinely strong and independent watchdog that will maintain the rule of law to protect workers and constructors and to improve productivity on building sites and construction projects whether onshore or offshore. This legislation will at long last reverse some of Labor's changes to the workplace relations laws which underpinned the Australian Building and Construction Commission before it was abolished by the Gillard government in 2012.

The bill prohibits unlawful industrial action, unlawful picketing and coercion and discrimination. It will put in place penalties that are high enough to provide an effective deterrent to breaches of these provisions. A number of effective remedies, including injunctions, will also be available to the ABCC and to persons affected by unlawful behaviour.

In passing this legislation the coalition government will finally be able to return some of the certainty and stability to the construction sector which went missing when Labor abolished the ABCC three years ago. Once again, we can banish some of the worst aspects of thuggery and lawlessness from construction sites across the nation and, most particularly, sites in Victoria and in my own state of Western Australia, where the corrosive culture within elements of the union movement have acted as a handbrake on economic activity for far too long.

Just to remind ourselves of the history of this issue: it was well known to insiders and to outsiders alike over many years that Australia's construction sector was home to the nation's most terrible examples of industrial thuggery and lawlessness. That was why in 2001 the Howard government's then workplace relations minister and now Prime Minister, Tony Abbott, established the Cole royal commission. It found that the standards of commercial industrial conduct exhibited in the building and construction industry varied significantly from those in the rest of the Australian economy—and not in a positive way.

Witness after witness testified to criminal conduct and unlawful and inappropriate conduct, including breaches of the relevant workplace relations and work health and safety legislation, and a blatant disregard for the law. When it came to my own state of Western Australia, the Cole royal commission found that:

… the rule of law has little or no currency in the building and construction industry in Western Australia.

'The rule of law has little or no currency.' Again, I quote:

The building and construction industry in Western Australia is marred by unlawful and inappropriate conduct. Fear, intimidation and coercion are commonplace.

Thus, in line with the recommendations that flowed from the Cole royal commission, the then Howard government moved in 2005 to set up the Australian Building and Construction Commission, a strong watchdog that would tackle lawlessness front-on. It was a strong, specialist regulator that enforced the rule of law applying to the building and construction sector.

Naturally then, as now, the move was opposed by the Australian Labor Party, which, at the end of the day, cares more about receiving its donations from the CFMEU than it does about the rule of law on Australia's construction sites. And over the three years between 2005 and 2012 when the Gillard government abolished the ABCC, what was the contribution of this body, which was detested, maligned and finally abolished by the Labor Party? According to independent research undertaken by Independent Economics in 2013, building and construction industry productivity grew by more than nine per cent, consumers were better off by around $7.5 billion annually and fewer working days were lost through industrial action.

A rational and responsible political party would look at those things and think they were positives. They would speak from the evidence. Alas, though, we are talking about the Australian Labor Party, aided and supported by the Australian Greens, led at the time by Julia Gillard and staunchly supported by her at the time loyal minister for industrial relations, Mr Bill Shorten. Instead of exhibiting a bit of leadership, standing up to union leaders and telling them that, actually, the way that they had been behaving was not on and the ABCC was needed to keep the militants and lawbreakers within their ranks in check, what did Julia Gillard and Bill Shorten decide to do? They rolled over and did exactly what the CFMEU and other unions were demanding, and abolished the ABCC.

Of course, no-one would have been more delighted by this complete capitulation to union thuggery than the likes of Joe McDonald, the secretary of the CFMEU's WA branch. Without the ABCC in place, he has been free to resume his traditional disgraceful behaviour. Earlier this year Mr McDonald, who has a long history of bullying, intimidation and thuggery on Western Australian building sites, was fined $30,000 and banned from a Perth construction site for three years—once again for bullying. He was found to have threatened to have workers 'thrown off every building site in Perth' if they did not support strike action the CFMEU was encouraging. This is not an isolated case. Joe McDonald has repeated form in this area. Not long ago he and the CFMEU were fined almost $200,000 for their role in unlawful industrial action at the Citic Pacific Sino iron ore site in the Pilbara, in the far north of my home state. The federal court judgement in that case found:

Mr McDonald’s conduct involves a calculated and careless attitude to the law governing the employment of persons by employers. It was calculated to cause disruption to employers carrying out building and construction work on the site and it was careless in that McDonald was aware of the legal consequences of his actions and pursued them nonetheless.

Indeed, Mr McDonald was proud of his flagrant disregard for the law. On that occasion, when his right to be on site was challenged because he did not possess a right-of-entry permit, he blithely said:

I haven’t had one for seven years and that hasn’t—

expletive—

stopped me.

All told, Mr McDonald and the CFMEU have, between them, been penalised to the tune of more than $1 million over the past decade for illegal industrial actions. Joe McDonald's history of criminal thuggery is well known to Western Australians. Indeed, it became well-known nationally in 2007—so well known that the then Labor leader, Kevin Rudd, ordered his expulsion from the Australian Labor Party. Julia Gillard was right on board at the time, saying:

Kevin [Rudd] and I have made it clear that under our leadership of the Labor Party there will be zero tolerance for unlawful conduct, for thuggery, in Australian workplaces.

Yet she seemed to have had a change of heart because less than six years later Mr McDonald was readmitted to the ranks of the Australian Labor Party where, so far as I am aware, he remains as a member to this day. True or false: does Joe McDonald remain a member of the Australian Labor Party to this day? Perhaps future speakers from the Labor Party might like to clarify that point for me.

That is not to say that the CFMEU's mischief is limited to the confines of my home state of Western Australia. Indeed, in Victoria the problems have been even worse. Almost the moment that the former Labor government abolished the ABCC in 2012, we saw a significant upswing in disgraceful conduct from the CFMEU in Victoria. In September that year, the CFMEU sanctions brought Melbourne's CBD to a virtual standstill. If you wanted an insight into the mindset of the CFMEU's leadership, there could scarcely be a more powerful one than the sight of its leaders telling a crowd of its members:

There’s 11,000 coppers in the country or in Victoria and there’s 30,000 members of the CFMEU and greater among the other unions when we call on their support, so we’re up around the 50,000 mark, so bring it on, we’re ready to rumble.

That is what we are dealing with: basically, a union leader saying, 'Don't worry, comrades, we can take on the cops.' That might appeal to those who exist in a fantasyland where every day is a goodie versus baddie Hollywood style script—a battle between the poor downtrodden worker and moustache-twirling capitalists—but it simply does not reflect modern reality.

More than that, such behaviour does absolutely nothing to promote the certainty and stability that the construction sector requires. In case it needed pointing out, the companies that the CFMEU demonises are the ones that actually create jobs for its members and, importantly, for its members' families. The union itself does not create jobs; it seems to create only trouble. No stronger proof of the complete disconnect between the CFMEU and the interests of ordinary workers is needed than the fact that in 2012 workers on building sites published an open letter in the Herald Sun newspaper, not to the government but to the leadership of the union that supposedly represents their interests, begging them to stop the blockades and the violence and to allow workers on site so they could go to their jobs. It really is utterly perverse: workers having to beg their own union to let them do their job.

One wonders how it is that the Leader of the Opposition, Mr Shorten, continues to tolerate this situation given the clearly criminal conduct undertaken by members of that union, including its senior figures like Mr McDonald, in Western Australia. Perhaps he values union donations more than the rule of law. Does Mr Shorten, the opposition leader, value union donations more than the rule of law? Perhaps future Labor senators speaking on this bill can clarify that point: does Mr Shorten, the opposition leader, value union donations more than the rule of law? Then again, perhaps we should not be surprised by his attitude, given the Leader of the Opposition's seeming attraction to militant union activity. That is no exaggeration. In 2013, in his capacity as Minister for Workplace Relations, Mr Shorten flew to Perth to address the conference of the Maritime Union of Australia. Standing in front of a banner boasting 150 years of militant struggle, Mr Shorten cheerfully told delegates: 'There's no place I'd rather be in Australia.' 'There's no place I'd rather be in Australia' than in front of a sign that talks about 140 years of militant struggle?

Of course, earlier this year we saw the MUA's ugly underbelly once again when, at its 2015 conference, a journalist from The Australian, Mr Andrew Burrell, was assaulted by an MUA member for the crime of attending the conference, which the MUA itself had invited him to attend. The MUA's WA secretary, Christy Cain, tried to distance his union from the attack. However, Mr Cain also sought to excuse the aggressor, subsequently identified as Mr Campbell Walton, on the ground he was suffering stress due to unemployment, except we later learned that was not true. Mr Walton is employed. He works as a stevedore in Perth and also owns his own earthworks business. Once again, we see a culture of thuggery, intimidation and violence from the union movement in Western Australia. Once again we have deafening silence on these issues from the union movement's backers here in the Senate. It is interesting to note, Senator Day, that during my contribution so far, not one Labor senator has come into this chamber, and the two Labor senators sitting in the chamber have not challenged what I have said—

Senator Bilyk: I have.

Senator SMITH: I have not heard a word, Senator Bilyk.

The ACTING DEPUTY PRESIDENT ( Senator Bernardi ): Order! Ignore the interjection, Senator Smith, and I would encourage you not to invite the interjections.

Senator SMITH: When are the Labor Party going to say enough is enough and exile these rogue unions from its ranks? When are the Labor Party going to say enough is enough? Only when they are challenged by a coalition senator. What makes all this especially disappointing is that there are good unionists out there.

Senator Bilyk interjecting—

Senator SMITH: This is a most important part of my contribution, Senator Bilyk. What makes all this especially disappointing is that there are good unionists in our country. There are those who genuinely try to provide a service to their members. I do not doubt that for a second, but their efforts are constantly overwhelmed by behaviour from their colleagues that is either aggressive or criminal or just downright stupid.

You do not have to take my word for it, and indeed I am sure you will not take my word for it. Not long ago, Mr Mark Olson, the WA state secretary of the Australian Nursing & Midwifery Federation, penned an opinion piece in which he called for unions to focus on their core business, which he believes might actually stop haemorrhaging membership numbers. He condemned the recent 'paltry gathering of a few hundred at the steps of Western Australia's Parliament House', which was supposed to represent a mass worker uprising but instead made him:

… wonder why this event was even happening, other than to try and help Labor … and perhaps boost the profiles of some union heavies in an election year.

He went on to say:

Workers are sick of self-serving union officials, helping out their buddies in the movement and in Labor, and not focusing on what's best for their members.

Indeed, Mr Olson is quite right, which is why workers are voting with their feet and why self-serving union figures like Mr Joe McDonald and Mr Christy Cain are resorting to increasingly desperate tactics to try and maintain their own relevance. This government is not about to let them do that, and it is certainly not going to do so at the expense of the national productivity growth.

Under the provisions of this legislation, the Australian Building and Construction Commission will be led by its commissioner, who will have the critical task of monitoring, promoting and enforcing appropriate standards of conduct by building industry participants and referring matters to other relevant agencies and bodies as required. The commissioner will also be responsible for investigating suspected contraventions of the law by building industry participants. They will also institute or intervene in proceedings in accordance with those laws and provide assistance and advice to building industry participants on their rights and obligations under designated building laws.

This government will make certain that the ABCC once re-established will be properly funded to ensure it can do its work and restore some certainty to the nation's construction sector, on which so much direct and indirect employment depends. This legislation enables the Australian Building and Construction Commissioner to compel witnesses to attend an examination, or to produce documents, in circumstances where he or she reasonably believes that the person has information or documents relevant to an investigation into a suspected contravention of workplace relations laws. This is critical in making certain the re-established ABCC is able to carry out its investigations effectively. I have much more to say, but time is definitely against me.

Senator BILYK (Tasmania—Deputy Opposition Whip in the Senate) (11:03): I have to say I find it curious that the Prime Minister who said that Work Choices is 'dead, buried and cremated' seems to take a fairly backward step to the dark old days of Work Choices every time his government seeks to introduce a workplace relations bill to this parliament. While Labor struck a good balance between the rights of workers and the needs of employers in the Fair Work Act, every legislative move by this government has attempted to tip the balance unfairly back in favour of business.

We will be debating legislation this week which would tie up unions in so much red tape that they would be unable to effectively do their job—so much for a government that seeks to reduce red tape. Let us look at what has happened so far. So far we have seen legislation that will make it more difficult for union representatives to enter workplaces or talk to workers. We have seen attempts to reintroduce AWAs via the back door by weakening the better-off-overall test. We have seen the government dump Labor's 'clean start for cleaners' contracting principles, cutting the wages of cleaners who clean the buildings of government agencies, including this place. We have seen a highly centralised approach to bargaining across the Australian Public Service in an attempt to put strict caps on conditions and pay increases. We have seen the government try to cut paid parental leave for thousands of parents, mostly mothers, referring to many of them as 'double dippers' and 'rorters'.

In addition to the legislative attacks on unions and workers' rights and entitlements we have also seen $80 million of taxpayers' money already wasted on a political witch-hunt, the Productivity Commission being used as a proxy for the government's attack on penalty rates and the government flagging plans to legislate to wind back the protection of wages and conditions for Australian-crewed ships.

Work Choices is not 'dead, buried and cremated'; it is merely in hibernation. They have merely had it lying low. Let us not ever forget that Mr Abbott said Work Choices was 'good for wages; it was good for jobs; and it was good for workers'. Despite their rhetoric, we know that the coalition cannot walk away from Work Choices. The urge to reintroduce elements of Work Choices is Pavlovian. It is in their DNA. So it should not surprise any of us that the Abbott government will continue its attack on workers by dusting off its draconian Australian Building and Construction Commission, or ABCC.

The establishment of the ABCC, as Senator Smith said, followed the Cole royal commission. Senator Smith had a lot to say on the Cole royal commission, but there are a few things he did not mention, and I will come to those. The Cole royal commission was effectively a futile and very expensive exercise initiated by the current Prime Minister when he was workplace relations minister. It took 18 months and some $66 million to run the Cole royal commission but—and this is the bit Senator Smith did not say in his somewhat biased comments—after 18 months and $66 million of taxpayers' money, do you know how many criminal convictions the government managed to secure? Would anyone on that side like to hazard a guess? Let me tell you. None, not one, zilch, absolutely zero. So much for the supposed criminality, fraud and corruption in the building and construction industry.

It appears that Mr Abbott and those opposite have not learnt their lesson about the folly of using royal commissions to pursue ideological battles. A royal commission is meant to be an instrument of justice, not a political instrument. It is meant to shine a light in dark places and investigate matters that have been unable so far to be uncovered. But the Cole royal commission was the start of a pattern displayed by those opposite, a pattern of using royal commissions to pursue their ideological battles against political rivals.

Now we have got the long-running, expensive political witch-hunt in the form of the Royal Commission into Trade Union Governance and Corruption. For those in the gallery and those listening who may not be aware that the trade union royal commission is a political exercise, on this side we are particularly concerned with the royal commissioner's judgement in accepting an invitation to help raise funds for, guess who, the Liberal Party. The recent revelations about Mr Abbott's royal commission and his captain's pick of a royal commissioner, Mr Dyson Heydon, confirm this. The community have legitimate concerns about the affinity of the commissioner with Mr Abbott and the Liberal Party. In fact, over the weekend I do not know how many people spoke to me about it.

I believe the commissioner really needs to consider whether his ongoing role in the royal commission is tenable. The royal commission is and always has been a political exercise commenced by Mr Abbott to go after his political enemies. And who are his political enemies? The Labor Party and the trade union movement. I believe that only a lawyer with a predisposition to the Liberal Party would have taken on this blatantly political royal commission. You only have to look at the terms of reference to know the intention of the government and that it is a political witch-hunt.

In regard to the fundraising event that the commissioner was going to attend, no matter what the commissioner knew and when, it is clear from his own correspondence that his predisposition is to the Liberal side of politics. To top it all off, we have seen the New South Wales Liberal Party absolutely refusing to reveal when the commissioner was invited to speak at the Liberal Party fundraiser, an event that we all know has been addressed by prominent Liberals since it commenced in 2010. So I think there needs to be a bit of revisiting some of the commissioner's conduct, some of the commissioner's rulings and some of the commissioner's conclusions so far and the question needs to be asked: was any of it was influenced by the commissioner's political world view? The commissioner has consistently gone beyond what might constitute corruption to what is legitimate industrial behaviour dealt with according to the industrial laws in place in this country.

The tendency of those opposite to use royal commissions as a political instrument has many unfortunate consequences. One in particular is that they waste tens of millions of dollars of taxpayers' moneys for absolutely no public benefit. Just look at the Cole royal commission. They are an exercise designed to produce a headline, to fight ideological battles and to embarrass the political rivals of those opposite. Another unfortunate consequence—and one I think is really sad—is that they have the potential to undermine the credibility of those royal commissions that actually are being used for public benefit and for justice and that are not merely a political exercise. With the royal commission currently being conducted into the serious issue of child sexual abuse—an issue which everybody in this place knows I am very passionate about—I consider this to be extremely unfortunate.

While those royal commissions that are used as an expensive political exercise by those opposite help to generate a headline, they are also a useful excuse for the coalition to introduce legislation aimed at gaining further power over their political rivals. And this was the other purpose of the Cole royal commission—to be the catalyst for establishing one of the most draconian bodies in Australia's history.

There is absolutely no justification for this bill we are debating today. There is already a watchdog for the building industry, and it is highly effective. The building industry watchdog that Labor put in place, Fair Work Building and Construction, has actually been outperforming the ABCC. Fair Work Building and Construction is undertaking more investigations, concluding more investigations and getting matters to court faster and recovering more money for workers in the industry. It has secured over $2 million in unpaid wages and entitlements for more than 1,500 workers. Under Fair Work, labour productivity is up, and industrial disputations have dropped dramatically compared to their levels under the Howard government.

The Abbott government use flawed modelling to back its argument that a body such as the ABCC needs to be reintroduced. The firm whose report they relied on, which is now called Independent Economics and was called Econtech, has a history of churning out report after report purporting to support the case for the government to attack the CFMEU. The claims in the report—particularly that the ABCC produced $6 billion in productivity savings—have been debunked by a range of people, including Justice Murray Wilcox QC, the Queensland Government's department of industrial relations, and academics from Griffith University. Justice Wilcox said the modelling is 'fundamentally flawed' and 'ought to be totally disregarded'. So basically you can disregard any comments that those on that side make in regard to those reports. But far be it from those opposite to engage in evidence-based policymaking, unless they are relying on discredited evidence which suits their predetermined agenda. For those opposite, this is personal and ideological. We know, as I have said, that Work Choices is in their DNA. We know that a coalition government will stop at nothing in attacking the rights and entitlements of workers. And we know that they will stop at nothing to attack those who stand in their way, particularly the trade union movement.

They do not like the fact that workers organise and bargain collectively, that they can negotiate on an even footing with big business—after all, big business are their financial and political backers, their mates. Those opposite, the Liberal-National coalition, are in their corner on workplace relations, just as they are on issues like multinational tax avoidance. Yet, those opposite have learned the hard way that Work Choices is politically toxic, so they try the boiled frog approach instead—introducing legislation bit by bit, aimed at cutting entitlements and attacking the collective power of the trade union movement. I think the Australian people are too smart to be fooled by that. They will not accept Work Choices 2.0 any more than they will accept the first version. Draconian bodies like the ABCC are part of the architecture of Work Choices and they should rightly be rejected.

Senator XENOPHON (South Australia) (11:15): At this stage, I would like to indicate that I will support the second reading of the Building and Construction Industry (Improving Productivity) Bill 2013 and related bill, but I reserve my position on the third reading. There are matters that I believe need to be thoroughly negotiated with the government, and with the opposition, in my view, to involve key stakeholders. That includes not only industry groups that are concerned about the state of play on building sites in this country but also the unions. These bills propose measures that are controversial and contentious. On the one hand, unions have a vital role in Australia's workplace relations system and they must have the freedom and power to be able to do their jobs. That involves not just issues about terms and conditions for their employees—obviously fundamental—but also issues of workplace safety.

Whilst I was a member of the South Australian parliament, I did propose, and it was rejected by a state Labor government, that we ought to have industrial manslaughter laws. I think we need to have tougher laws in place when it comes to workplace safety and there ought to be appropriate and strong penalties in respect of that. Insofar as unions require a right of entry for the purpose of safety issues, then I think that is quite fundamental and ought not to be derogated from.

On the other hand, concerns have been raised through the royal commission, and the Boral court case cannot be ignored—and I will refer to that shortly. I think it is appropriate, at this stage, to refer to the controversy around Royal Commissioner Dyson Heydon and the invitation to a Liberal Party fundraiser. Notwithstanding that not much money probably would have been raised at that fundraiser—presumably there can be auctions and other peripheral fundraising activities that usually occur at these things—it was an invitation about which we need more information from the royal commissioner. I think it is quite reasonable for the royal commissioner to provide a detailed and thorough explanation as to what he was aware of at the time he accepted the invitation, when he accepted the invitation and whether he was the commissioner or about to be appointed as commissioner for this royal commission. If he did so whilst he was royal commissioner and he assumed that the royal commission would be over by then and that there would not be a problem attending this fundraiser, and he was aware that it was a Liberal Party fundraiser, then, on an objective basis, I think that would show a significant error of judgement on the part of the royal commissioner. If so, he ought to be apologise for that.

Notwithstanding what the member for Sturt has said, that this was a birthday gift for him the other day on his 48th birthday—and happy belated birthday to Christopher Pyne—as you know, Acting Deputy President—

The ACTING DEPUTY PRESIDENT ( Senator Bernardi ): I would ask you to refer to the member for Sturt by his appropriate title, Senator Xenophon.

Senator XENOPHON: What title would that be?

Senator Bilyk: Mr!

Senator XENOPHON: Mr Pyne, sorry—the Hon. Mr Pyne. Thank you for defending the honour of the Hon. Christopher Pyne, Mr Acting Deputy President. I am very grateful for being pulled up on that.

Senator COLBECK: A principle worth upholding.

Senator XENOPHON: It is worth upholding. It was unambiguously a very serious issue that still needs to be ventilated because there are issues that some have raised about apprehended bias. I know there are different academics raising different views about this. I note that Julian Burnside—no friend of the coalition government—has defended the commissioner. At the very least, if the commissioner accepted this invitation, assuming that the royal commission would be over, then I think it shows an error of judgement on his part and an explanation is warranted.

In my view, if you are a royal commissioner on something as contentious as this, then for the rest of your life you should not even be thinking about attending any political event or any party fundraiser. It is interesting to note what some commentators have said, such as Michael Stutchbury—the editor of The Financial Review—yesterday on Insiders. He used to do music reviews for me when I was on the Editor many years ago at Adelaide university and is a fine music review writer. He raised issues about the nature of the interchange between the royal commissioner and the opposition leader. There are some reasonable commentators who are saying that that may have been seen to be somewhat too harsh and unnecessary in terms of the royal commissioner's intervention.

The royal commission has gathered evidence, some of which I find quite compelling, about allegations of corruption and about allegations of bullying and harassment. These matters also relate to serious allegations of misuse of funds, boycotts, threats and even corruption. These allegations, if true, are clearly unacceptable. And they raise the question of whether our existing legislative framework is strong enough to properly address these issues. We know the commercial building sector is a very substantial employer. I want a strong and vibrant building and construction industry in this country in the commercial sector as well as in the home-building sector. I want the workers in that industry to go to a safe working environment where occupational health and safety are of paramount consideration. I also want them to be well paid for the work that they do. If there are impediments, then they need to be dealt with in a way that people's rights are considered.

I want to make it very clear that union representatives I have worked with in the past and whom I am working with on current issues have always been strongly against the kind of action that this legislation aims to address. I think it is an interesting paradox that there is no suggestion that Michael O'Connor, the head of the CFMEU—someone with whom I have worked very closely on issues involving free trade, 457 visas and putting Australian jobs first—has been involved in these sorts of activities. If find him to be a person of great integrity.

I have also worked recently with Aaron Cartledge, the state secretary of the CFMEU in South Australia, who has been subject to some allegations. However, one issue that I have worked with him very constructively on is substance abuse on building sites, particularly the use of ice. He has shown a lot of leadership in relation to that, because he does not tolerate it and the impact that it can have on a work force and the safety of not only those who are abusing the substance but also others on building sites.

More recently, I have also worked with Mr Cartledge and met with a number of subcontractors in relation to the collapse of Tagara Builders—a complete mess that has left many people in the lurch. I have to give credit to Mr Cartledge for the work that he has done on that. We need a better approach to this in consultation with industry so that subbies—the subcontractors—who have been left in the lurch and face financial ruin have better forms of redress. I also wish to pay tribute to Senator Cameron's work in relation to this, and I hope that the inquiry will have a hearing in Adelaide sooner rather than later, because it would be incredibly welcome. We need a better approach to dealing with that.

Insofar as there are allegations of bullying, intimidation and corruption, they need to be dealt with. I do not subscribe to the view that unions are uniformly bad or that they have too much power. I do very strongly believe that they have responsibility and a duty of care to their members; in the environment that they work in, they do not cause unnecessary and needless disruption; and they should be subject to greater scrutiny in that regard.

I also believe that, as in any negotiation, there may be particular individuals or groups who act in their own interests who are rogue operators instead of acting in their members' broader interests. It is these people who I believe this legislation ought to be targeting. The question is: are the measures in these bills fair and proportionate to the issues that they are trying to address?

I have some concerns about limiting the control of a body such as the ABCC solely to the building and construction industry—and I do not want to verbal my friend and colleague Senator Madigan about what to do about corruption in other sectors where there are concerns in other workplaces. I acknowledge the argument, however, that this is where most of the concerns have arisen but I wonder whether this legislation should be so targeted at one sector. Surely, there are legitimate concerns in other sectors that could benefit from the oversight provisions in these bills.

A few months ago I supported, unambiguously, the need to give the fair work building inspectorate the coercive powers to call in witnesses just as the ACCC, ASIC and other key regulators have. Without those powers, you will not get in my view some witnesses coming forward. There has been intimidation in respect of that from the evidence that I have heard.

I note that my crossbench colleagues Senators Madigan and Lambie have expressed concern about the breadth of this legislation. I look forward to exploring these matters in more detail during the committee stage, if the bill is passed at the second reading stage—as I hope it will—because I think these are legitimate issues that need to be vented.

I also think it is important to clarify that I believe that some changes need to be made in this area. What I am hoping to have clarified by the government through this process is why the new ABCC has to be established and why the additional powers should simply rest with the Fair Work Building and Construction inspectorate or Fair Work more broadly. I will also be seeking assurances from the government in relation to maintaining the right of entry and other matters for union representatives in relation to legitimate workplace and safety issues. I do not want to see reasonable union behaviour curtailed and I want unions and businesses to have access to the tools they need to combat the serious issues that have come to light.

In relation to the issue of Boral, that is a matter still before the courts; however, I do not think it is improper to raise the fact that this has taken a long time for our legal system to deal with these issues. It raises issues about access to justice, which is a much broader issue in civil and all sorts of disputes in this country, but it has had a significant impact on one particular company. If the allegations are proven, then it raises issues as to whether there has been an abuse of power in that regard. I think that there must be a better way for the resolution of such disputes, and the difficulties in the gathering of evidence in this case raise issues about whether you need to have the sorts of mechanisms that have been raised in this legislation in some form to deal with disputes.

At the end of the day—and I emphasise this—I want there to be a strong building and construction industry in this country. Building and construction can provide a real antidote to the job losses we are expecting in manufacturing. Having people working in a safe, working environment on good incomes is absolutely fundamental. My concern is that there needs to be some reform to help facilitate that. The issue is: to what extent do you go in this legislation? I think it is worth having this bill go into committee for further negotiations in respect of this.

Senator ABETZ (Tasmania—Leader of the Government in the Senate, Minister Assisting the Prime Minister for the Public Service and Minister for Employment) (11:28): I thank honourable senators for their contribution to this debate. I also indicate that, in the event that the second reading is supported by honourable senators, I will be seeking to adjourn further debate—namely, the committee stage—for further discussions to take place.

Prior to the 2013 federal election, the coalition committed to re-establish the Australian Building and Construction Commission to restore the rule of law to a sector that is plagued by lawlessness, intimidation and thuggery. The government consulted widely seeking feedback on this important policy to identify issues which need to be addressed.

The construction industry is critical to a productive and prosperous Australia and is vital for jobs. It is the nation's third largest employer, with more than one million people employed by the 100,000-plus predominantly small and medium businesses. The sustainability and success of the construction sector are crucial to the Australian economy and to the Australian people.

The need to re-establish the ABCC is clear and evident. This industry, regrettably, stands apart from others in terms of its industrial unlawfulness. For far too long there has not been a meaningful consequence in the construction industry for doing the wrong thing. Who is then surprised that this has resulted in a culture where complying with the law is taken to be merely optional? Industrial laws and penalties in this industry are seen as no more serious than a parking ticket where the fine is paid, the cost charged to the client or union members and the offending conduct repeated again and again. Since 2005 the courts have imposed fines of over $6.1 million on CFMEU related unions and officials for proven breaches of the law, but even this has not been enough to deter those activities from continuing—remembering that these are breaches of laws that have passed through this chamber but are yet ignored. The Federal Court recently spoke of the CFMEU's 'outrageous disregard' for 'Australian industrial norms'. The court also cautioned that breaking the law should not be seen as 'nothing more than an affordable price of doing business'. Yet, because Labor and the Greens slashed the maximum penalties for industrial wrongdoing in this area by two-thirds, that has only promoted the CFMEU's business model of breaking the law.

Re-establishing the ABCC is about introducing a meaningful consequence for unlawful industrial conduct in the construction industry, whether by unions or employers. It is about bringing about a needed change in the culture. When there is an effective regulator enforcing laws with meaningful penalties, there will once again be a deterrent for breaking the law, and those who would previously have done the wrong thing, simply because they could, will think twice.

While the ABCC existed, the performance of the construction sector improved. The ABCC contributed to economic benefits for consumers, higher levels of productivity and fewer days lost to industrial action, and we saw an increase in respect for the rule of law across the country. This benefited all law-abiding workers, unions and employers and the taxpayer.

Labor abolished the ABCC in 2012 and replaced it with a significantly weakened regulator. Labor slashed its budget by $9 million each year, making it even more difficult for the independent regulator to do its job. What flowed from Labor abolishing the ABCC was entirely predictable. Almost immediately we saw the CFMEU shut down parts of the Melbourne CBD for days on end in defiance of Supreme Court orders. Who can forget seeing on the news footage of protesters yelling abuse and threatening workers trying to get to work—workers who were actually members of the CFMEU, by the way—or protesters attacking police horses? All this while, CFMEU officials actively promoted this ugliness.

I am amazed that certain Labor and Greens senators opposite sit in silence when faced with such conduct and do not immediately condemn such abhorrent and repeated unlawful and thuggish behaviour. If the Senate were faced with such unlawfulness in another part of society as has been seen in the construction industry, there would be an outcry, and rightly so, yet we have silence from those opposite in respect of the construction sector. There are currently 69 CFMEU representatives before the courts or the Fair Work Commission, and the courts have time and again commented that the CFMEU simply shows no contrition despite repeated penalties being imposed on it for its wrongdoing.

The current system is simply not effective. It was only on Friday last week that a Federal Court judge fined a CFMEU official for his contempt in ignoring the court's orders. The judge said:

The CFMEU has a significant history of non-compliance with the provisions of industrial legislation … I have remarked upon the fact that each of the individual respondents' conduct indicates that each—

with the exception of one individual—

simply did not care about complying with the entry provisions.

In that case, the court found that the CFMEU officials had threatened to go to war against the subcontractor if he did not employ a CFMEU official and put him on the payroll. This was last week in South Australia, not some historical reference to the former BLF. This was a decision of the Federal Court in Adelaide just three days ago.

It reminds me of an earlier case where a CFMEU official was found to have said to a contractor in Victoria:

Everything works on a bit for youse and a bit for us. Forget about the law, … right?

Another CFMEU official in Queensland was found to have told a group of contractors who had been prevented from working because of the union blockade:

You've all got a long time left in the industry, and we can influence your future jobs.

When one of the subcontractors asked, 'What are the consequences to my business if I bring my boys on site?' the union official replied:

You want to know what the consequences are? You would be committing industrial suicide.

I am sure senators from South Australia, Victoria and Queensland in particular would join me in condemning these examples of the disregard shown for the laws of this parliament in their home states.

Regrettably, these are not isolated incidents. They disclose a culture in the construction industry of wilful defiance. The list of examples continues. Only last week, there were allegations finally explored in the Royal Commission into Trade Union Governance and Corruption over the conduct of the CFMEU—listen to this—in siphoning off half of all employer EBA payments meant for a drug and alcohol facility straight into the CFMEU's own coffers.

In another example of the graft revealed in evidence, the CFMEU had skimmed $80,000 of a $100,000 donation by a construction company to a drug and alcohol facility. The CFMEU took an unauthorised 80 per cent donation for itself. Yet Labor and the Greens would say, 'Nothing to be seen here; move right along. We don't need to deal with this.' This conduct shows there are elements in the industry, particularly in the construction division of the CFMEU, that are more interested in exercising their power over overs and lining their own pockets. I would also say that I think employers have a huge responsibility here. But one suspects these payments are simply made to buy some industrial peace and whether the money gets used for drug and alcohol purposes is a secondary consideration.

I will move on to the point of safety. The act that established the former ABCC, the present bill and Labor's Fair Work Act have the same standard of safety in respect of stopping work over safety concerns. The proposed ABCC legislation uses the very same standard on safety that Labor put in its Fair Work Act and which currently applies in the construction industry. Incidentally, this is the exact same standard which was previously included in the former ABCC legislation. This bill does not contain any provisions that would prevent legitimate safety issues in the building industry from being raised and addressed by employees, unions or state and territory work, health and safety regulators. I also note that the bill retains the role of the Federal Safety Commissioner and the Australian government's building and construction industry work, health and safety accreditation scheme. The misrepresentations over this important issue should be seen for the shameless tactic it is; namely, to deflect and distract from their unlawful industrial conduct.

On the issue of the compulsory powers, I have made it clear many times in this place that they are similar to powers that Labor gave to the FWBC. And Senator Xenophon outlined that the powers that the ACCC, ASIC and APRA have are very similar, other than there are a lot more safeguards under this legislation.

A very important aspect of this legislation is that it will remove the absurd and unprincipled restriction on the current regulator to which no other Commonwealth regulator is subject. This is in fact without precedent. This restriction prevents the regulator from commencing or continuing legal proceedings if private industrial parties reach a 'settlement' in their own interest. This put private interests above the public interests. When this absurd restriction was forced through this place by Labor and the Greens even the Law Council of Australia condemned such a restriction on a public regulator. This private settlement arrangement is subject to abuse. It is the equivalent of the Fair Work Ombudsman being unable to prosecute an employer guilty of underpaying a worker because the worker and employer reached a confidential settlement which could be for a nominal sum of $1. This also has the perverse outcome that, once wrongdoers achieve what they set out to achieve through unlawful means, they have an added incentive to coerce parties into confidential settlements so the public regulator cannot prosecute.

We recently saw an example of how this absurd restriction played out in Queensland with respect to the nine-week strike at the Lady Cilento Children's Hospital site. Just before the judge handed down his decision on wrongdoing over the nine-week stoppage, the CFMEU and ETU entered a confidential settlement with the builder; meaning the FWBC was unable to take any action in the courts in respect of the nine weeks that were lost on that important public project. At the end of the day, the regulator was legally prevented from enforcing the law and the taxpayer was left to foot the bill. If such a restriction on enforcing the law in the public interest were imposed on the police, on the Fair Work Ombudsman or the ACCC, there would be an outcry from those opposite—and rightly so. Yet, when the favour is done for the benefit of the construction unions, which are significant donors to Labor and the Greens, there is simply shameful silence from those opposite.

Any objective observer can recognise that there is a particular problem in this industry; yet the ABCC was regrettably abolished before it could achieve a lasting change in culture in the industry. I recall at one time the construction union was crying for 'one law for all' in arguing for the abolition of the only regulator that was keeping it in check. When one considers the appalling rap sheet of the CFMEU and its litany of regular and repeated industrial contraventions, it is clear that the CFMEU has no credibility when it calls for the application of 'one law for all'. It ignores Supreme Court injunctions. It ignores orders of the Fair Work Commission. It thumbs its nose at the rule of law, which it says everybody should abide by. The FWBC reports that it now has more cases before the courts than ever before. As I said a moment ago, there are currently 69 representatives before the courts. More than 90 per cent of FWBC cases before the courts involve allegations of wrongdoing by the CFMEU. Is anyone surprised that the ABCC, which was effectively started to hold the CFMEU to account for breaking the law is opposed by the CFMEU?

There has been the suggestion that, as a solution, we should deregister the CFMEU. I would make three points. Firstly, when the Builders Labourers Federation was deregistered in the 1980s it was a Labor government, with the support of a responsible opposition, that passed the legislation. The fact is that the current Labor opposition and the Greens are so beholden to the CFMEU that they would not support such a measure. Secondly, the deregistration of the BLF did not solve the problem of the culture in the industry. Here we are again dealing with the BLF by a different name and once again facing endemic industrial unlawfulness in the industry. Former BLF tactics have simply migrated to the CFMEU—which leads me to my third and key point.

The purpose of the ABCC is to introduce into the industry the concept of respect for the rule of law. The ABCC will work to introduce a culture in which any party, whether an employer, employee or union, accepts that they must comply with the laws set by this parliament. Indeed, I am reminded that just last week Baulderstone, a major construction company, was fined for having demoted a worker where the only reason that could be proffered was that this worker had resigned from the CFMEU. This sort of cooperation behind the scenes between big unions and big employers needs to be weeded out, and I am delighted that Baulderstone was publicly shamed by this case and fined for so doing. This is why we need the ABCC.

The bill will also provide for a building code. This applies to employers, and only employers can be sanctioned for breaches of it. The code will mean employers can no longer just ignore wrongdoing on their sites because they do not want to get involved. Employers will no longer be able to ignore inefficient practices and cost blowouts because they know they can just pass the cost on to their client, who is often the taxpayer. The building code will require strict compliance with employment, safety and migration laws. Why shouldn't the taxpayer expect that projects funded with tax dollars are run efficiently, lawfully and safely? The new code will have a new and streamlined enforcement mechanism to allow the ABCC to efficiently impose sanctions on employers who breach the code. The code will introduce a real commercial consequence on employers for doing the wrong thing or for allowing laws to be broken on their sites.

There has been a concerted campaign of misinformation about the code—for example, the absurd suggestion that the code bans RDOs or time off over Christmas or Easter. Each of these claims is simply false. Why they are made beggars belief, but it indicates the paucity of argument against the proposal that is currently before the Senate. One only needs to ask: what are the true motivations for the misrepresentation and untruths that are propagated in opposition to the return of an effective regulator and an effective building code that will hold employers to account?

The problem of endemic industrial unlawfulness in this industry has been clearly established. No objective observer can argue that the construction industry is simply like any other; it has shown itself to stand apart from other industries. The current laws have proven not to be enough. What is proposed in this legislation is about changing culture so this industry becomes like every other—that is, one in which the law always applies rather than only when convenient. The Senate today has a clear choice before it: to either send a message to the construction industry that it must comply with the law like everyone else or turn a blind eye and endorse the construction industry's history of ignoring the laws of this parliament and engaging in intimidation and bullying.

The problems with this industry are obvious. The choice is clear. The consequences flowing from that choice will be evident soon enough. As this nation embarks upon its most ambitious infrastructure-funding project of over $50 billion, it is vital to ensure that the construction sector is brought to account to abide by the rule of law so that the $50 billion worth of money invested by the Australian taxpayer proves value for money and that these projects can come in on time and on budget. I commend the legislation to the Senate.

Senator ABETZ (Tasmania—Leader of the Government in the Senate, Minister Assisting the Prime Minister for the Public Service and Minister for Employment) (11:56): 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—

I rise to reintroduce the Fair Work (Registered Organisations) Amendment Bill 2014 because this Government stands on the side of the honest worker and is absolutely committed to ensure that we never again have a situation, like occurred in the Health Services Union, where union bosses can rip off union members.

The Fair Work (Registered Organisations) Amendment Bill implements the Government's election commitment outlined in the 'Policy for Better Transparency and Accountability of Registered Organisations'. It will enhance the accountability and transparency of registered organisations by broadly aligning the obligations of office holders, penalties and powers of the regulator with the Corporations Act 2001.

The bill increases civil penalties and introduces criminal offences for serious breaches of officers' duties similar to those applicable under the Corporations Act. The bill also establishes the Registered Organisations Commission as independent but within the Office of the Fair Work Ombudsman.

Most importantly, especially for those opposite who claim this to be a partisan venture, the policy principles behind this bill are supported by Simon Crean, Martin Ferguson, Robert McClelland, Paul Howes, Ian Cambridge and Steve Purvinas—all doyens of the labour movement. The bill also addresses concerns raised in the Federal Court by Justice Anthony North who said that the penalties under the existing legislation are 'beneficially low to wrong doers'.

This legislation will bring penalties in line with the Corporations Act because we believe that there is no difference between a dodgy company director ripping off shareholders and a dodgy union boss ripping off members.

I want to absolutely stress, that the only people who have anything to fear from this bill are those who are doing the wrong thing. I also want to re-affirm that the Government firmly believes that the vast majority of officers of registered organisations do the right thing.

I note that the Senate earlier this week defeated this bill, but it is important to recognise that the debate was quite bizarre in that the primary reasons that the Opposition opposed the bill are in fact actually issues already enshrined in the legislation as it currently stands today and is in full force. The onerous disclosure obligations that currently exist were in fact imposed by the Leader of the Opposition when he was Minister for Workplace Relations and will be removed under the Government's bill.

For example, the Government moved amendments to remove unnecessary disclosure requirements on officers and organisations that were first included by the previous Government's 2012 amendments to the Fair Work (Registered Organisations) Act 2009.

They align disclosure requirements more closely with long standing governance and accountability provisions under the Corporations Act 2001.

We have moved amendments to section 293C, which relate to disclosure of material personal interests of officers. This will significantly reduce the number of officers who will be required to make disclosures. The amendments ensure that:

Only disclosing officers, those whose duties relate to financial management of the organisations, must disclose their material personal interests.

Officers no longer need to disclose the material personal interests of their relatives.

Disclosures also only need to be made to an organisation's committee of management and can be given as standing notice. Previously, disclosures had to be given to the entire organisation and included in the officer and related party disclosure statement.

Previously there were no exceptions to the requirement for officers to disclose their material personal interests. A number of new exceptions have been included. A disclosing officer does not need to disclose their interests if, for example, they:

-arise because they are a member of a registered organisation and the interest is held in common with other members;

-arise in relation to their remuneration as an officer;

-relate to a contract the organisation is proposing to enter into that needs to be approved by members and will only impose obligations if approved by members; or

-if the interest is in a contract with a related party and arises merely because the officer is on the Board of the related party; or if the officer has given standing notice of their interest.

The Government also moved to amend the current law to ensure that financial officers with relevant experience can apply to the Registered Organisations Commissioner for an exemption from approved governance training. This will mean fewer officers who are required to undertake such training.

These are all issues that were identified by Labor as problems. They are problems that exist in the law as it stands today. They are problems created by Labor and we will fix them with this bill.

As my colleague the Minister for Employment has said previously, there is only one major party in this place that supports a clean and honest union movement. And it is not the party of the unions. In opposing this bill in the other place, the Opposition demonstrated that it has learned nothing, that its first instinct is to protect crooked union bosses rather than honest union members. This bill, had it been in place, would have protected union members from the likes of Craig Thomson and Michael Williamson. By not supporting the bill, the Opposition is leaving union members at the mercy of future Craig Thomsons and Michael Williamsons.

I won't seek to cover the bill in further detail given that this is a reintroduction. I simply call on all Members to support honest union members and honest union bosses by supporting this bill.

I commend the bill to the Senate.

Senator CAMERON (New South Wales) (11:56): Labor opposes the Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2]. This bill is a virtual replica of the Fair Work (Registered Organisations) Amendment Bill 2013 which was rejected by the Senate on 14 May 2014. It is also a virtual replica of the Fair Work (Registered Organisations) Amendment Bill 2014, which was rejected by the Senate on to March 2015. The only difference is that this bill includes government amendments to the previous 2014 bill that were agreed to in the House of Representatives. This bill is unnecessary and imposes burdensome regulation on registered organisations that no-one wants—employee organisations do not want it and employer are organisations do not want it.

This bill epitomises the government's determination to destroy effective collective bargaining and effective trade unionism in this country. It demonstrates clearly that the extremists are in control in the coalition. We have Senator Abetz, a work choice warrior, pursuing this bill to try to stop workers having access to effective trade unions in this country. We saw what happened when this government had control of the Senate. They attacked workers' penalty rates, they attacked their annual leave loadings, they attacked their conditions. We only have to see what they are doing at the moment without the control of the Senate, they are proposing to increase the working hours of public servants in this country. They want to remove conditions from the Public Service in this country. They want to weaken bargaining and union representation of workers in this country. They want to change the higher duties qualification for public servants in this parliament. They want to change personal and carers leave for public servants. They want to attack the trade union movement and workers every opportunity they get. Nothing could epitomise that more than this bill and the actions that the cleaners in this parliament are having to take this week to protect their wages and conditions against attacks on the cleaners of this parliament. These are some of the weakest people in the parliament, with the weakest bargaining capacity. They are some of the people who need support to get decent wages and conditions. Some of the cleaners are working two to three jobs to keep food on their family's table, and yet this government attacks them by cutting their wages.

Look at Hutchison ports where, until Senator Abetz was forced into an embarrassing reversal, he basically indicated that sacking a worker by email or text message was okay. He had to retract that and move away from that, basically after providing what his real position was.

These people are extremists. These people do not care about workers' rights in this country. These people do everything they possibly can to diminish workers' capacity to balance up their bargaining power against the boss. That is what it is all about.

Look at this royal commission that they have established—a royal commission that is clearly exposed as a political attack on the trade union movement and their political opponents. That is what this government are about; they are about a naked attack on their political opponents. They use a royal commission and put their mate in as royal commissioner. Their mates go down and sit in that commission, attacking the Leader of the Opposition and attacking trade unionists on the floor of the royal commission. This is the same royal commissioner who accepted an invitation to go to a Liberal Party fundraiser. That is the type of behaviour that this government undertakes, and this legislation is part of that general attack on workers' rights to bargain in this country.

If you look at the ABCC: thankfully, this Senate has again stopped the attack on workers' rights in the building and construction industry. They have set up a Fair Work Building Commissioner who is biased, who is incompetent and who attacks the workers in the industry at every opportunity. This is a government which have absolutely no understanding of fairness and no understanding of the need for collective bargaining in this country.

They have established a Productivity Commission review to try to give them cover in order to cut the penalty rates of workers in the hospitality and retail industries. The Productivity Commission was cover—nothing more than cover!—to come out and say, 'Cut the penalty rates of workers in retail and other areas! Cut the penalty rates of some of the lowest-paid workers in the country!' And we know that is what this government want to do.

They think this country can become more productive by forcing workers into servitude. They think this country can become more productive by cutting wages to the lowest they possibly can. They think this country can become more productive by forcing workers to rely on tips, as workers in the United States of America do! This is a government that is completely out of touch with ordinary Australians—absolutely no idea what it means to struggle to put food on the table, to buy their kids schoolbooks, to put the kids into school uniforms and to send them off to school. They have absolutely no idea. All they want to do is act on behalf of their big business mates and act on behalf of their mates who do the brown paper bags in front of their Bentleys in Newcastle, to get their support for re-election. That is what this government are all about. No-one should have any misunderstanding about what this attack and this legislation are about.

They scrapped the low-income superannuation benefit for some of the lowest-paid in the country. Everybody knows that the lowest paid will need more support and more help to get a decent retirement—a retirement with dignity. But what do this mob do? They cut away at their capacity to get a decent retirement.

They have made a submission to the national minimum wage review, which basically said to give them nothing—give the lowest-paid in this country nothing! They are a government completely at odds with fairness and equity. They are a government which cannot be trusted. They cannot be trusted. If you look at what they said before the election in terms of industrial relations, in terms of taxation, in terms of funding for the ABC and in terms of pensions, then what have they done? They have gone back on every promise they made to the Australian electorate before the last election.

And then they brought about a budget that has been universally condemned—a budget that was about looking after their mates with their fat wallets at the big end of town and coming after workers and pensioners in this country. Well, this bill is another part of the push by this government to suppress workers' rights and to suppress workers' capacity to be able to bargain effectively against employers that want to reduce their wages and conditions. It has nothing to do with productivity; it has nothing to do with oversight of the trade union movement and it has nothing to do with decency for workers in this country.

Ten coalition MPs are on the public record in calling for cuts to penalty rates. I remember when I was on the job as a fitter in the power industry and in the shipbuilding industry. I needed my penalty rates to pay my bills, to pay my rent and, eventually, when I got a house, to pay my mortgage. The penalty rates were important!

This bill will weaken the organisations that will help workers maintain and improve their wages and conditions and protect their penalty rates in this country. This is another example of a coalition government that has no care for ordinary workers in this country, a coalition that will simply deliver for its big business mates whenever it possibly can.

And yet on this bill Senator Abetz has done something that I did not think would be possible in this term of government. He has actually united the trade union movement and employer organisations to say that this bill is unfair, that this bill is not appropriate. I was a member of one of the governing bodies of the Australian Manufacturing Workers Union; I was a fitter; I was on the governing body of the union. The coalition is saying that I should have been treated and workers should be treated the same as high-paid executives on the boards of companies. It is an absolute nonsense.

Not one union who made a submission to the inquiry on this accepted the proposition that a worker, a volunteer, on a governing body of a union was the same as some high-flying executive on the board of a company—not one. Not only didn't the unions accept that position; the employer organisations would not accept that position either. The employer organisations drew attention to the fact that they had many volunteers on their governing bodies who were not being paid and should not be subject to the same checks and balances that are on high-flying well-paid professional people on the boards of companies. It just does not make sense. It is not what should happen. But this is about the political ideology, the extreme ideology, of the coalition, who will not even accept a bit of fairness about workers are represented.

The AIG have said they oppose this bill. They say:

The provisions of the Bill in this area will operate very unfairly on registered employer organisations and their officers, and it is essential that the Bill is amended. The Bill would impose a far more onerous regime for officers of registered organisations than what applies to directors of public companies. The regime, if enacted, would undoubtedly deter persons from standing for office in employer organisations. In practice the provisions of the Bill would seriously impede many organisations from carrying on their daily business operations.

This is the AIG, the Australian Industry Group, one of the biggest, most respected, most influential employer organisations in the country, and they say: 'This is crazy. This is not what should happen. You will stop people volunteering to come on the governing bodies of the Australian Industry Group and employer organisations.'

That is exactly the same submission we received from unions and their representatives. Unions were saying: if you start to take penalty provisions against ordinary workers—who could be cleaners in Parliament House but on the board of a governing body like United Voice, the union—then they would be subject to the same penalties as a very wealthy, professional, former executive who happens to be on the board of a company. They do not match up. It just does not make sense. That is why the Australian Industry Group is saying: 'Nonsense! This is nonsense. It should not be done.'

The Australian Privacy Foundation in their submission says:

There has been no demonstration that existing law … is inadequate, e.g. that there is serious and pervasive corruption that is not being addressed because investigators and prosecutors lack authority.

Except for extremists such as Senator Abetz on the government side—those on the government side that want to destroy effective trade unionism in this county, those on the other side that want to diminish the wages and conditions of ordinary workers—no-one believes that this bill is an appropriate bill. The employers do not believe it; the employer organisations do not believe it; the trade union movement does not believe it; the ACTU does not believe it. the Australian Privacy Foundation in their analysis say that it is flawed. This is a bad bill from a bad government. That is the bottom line. It is about their ideology.

And it is not just the Australian Industry Group who oppose this. The Motor Trade Association of South Australia—I do not think you would call them some kind of communist group undermining the country—say this is not on, that you need amendments to this bill, and that the bill as it stands should be opposed. The Motor Trade Association of South Australia go through all of their problems with the bill.

This is a bad bill. The South Australian Wine Industry Association—I think Senator Edwards might be on that board or might be involved with them—criticised the alignment of directors' responsibilities. And they basically say they are a not-for-profit incorporated association and that the role of their board members cannot be directly compared to listed public companies.

So you cannot compare the work of a volunteer—a cleaner on the board of their union, a fitter on the governing body of the AMWU or an electrician on the governing body of the CEPU—with the professional people like ex-directors and ex-managing directors of companies, who are on boards of companies who are there for a profit. One is a voluntary organisation and the other is an organisation for profit. And to try to compare them is nothing more than an attempt to destroy effective organisation in this country.

Let me tell you that without an effective trade union movement in this country workers would end up like workers in America in the retail sector, where they have to depend on tips to get a decent living wage. That is what would happen. You would see workers not be in a position, as eminent economists have said, to have some countervailing force against the employers in this country. There would be no countervailing force because you would not be able to have effective organisations, and workers' wages and conditions, penalty rates, shift allowances and annual leave loadings would disappear. That is what this mob is about. Make no bones about it: it hates the trade union movement and it hates workers getting decent rights. That is what it is about. This bill must be opposed. (Time expired)

Senator RICE (Victoria) (12:16): The Australian Greens oppose the Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2] in its entirety. Here we are again defending Australian workers from the ideological attacks of the besieged Abbott government. We are hot on the heels of the debate this morning over the building and construction industry which, it was very pleasing to see, got rejected.

The ideological attack on workers and unions by this government is clear to see. It fits in with the union-attacking agenda of the trade union royal commission, that politically motivated witch-hunt that has been laid clear over the last week. With the royal commissioner, Dyson Heydon, having accepted an invitation to speak at a Liberal-fundraising event, the political motivation of the attacks of the Abbott government on the trade union movement and on ordinary workers is very clear.

The legislation that we are discussing today is essentially the same legislation that we were debating earlier this year and that got rejected. It got sent back. The Senate said that this legislation is unwanted and unnecessary. This bill works on a simple principle and that is, 'We'll come for the unions first so that there is no-one left to protect the workers when we come for them.' And this government is attempting to dump a mountain of red tape, unnecessary red tape, on unions to prevent them from advancing the interests of the people that they exist to protect.

From a government that claims to want to reduce red tape, the hypocrisy is appalling. Supporters of this bill claim that it puts corporations and registered organisations on an even footing, wrongly suggesting that unions and other registered organisations ought to be treated in the same way as corporations because they are fundamentally the same. This notion is completely false. It completely dismisses the clear differences between these organisations.

The government fails or refuses to understand that employee organisations do not exist for the same reason as businesses. Unions are required under the Fair Work Act and other legislation to be democratic organisations; corporations are not. Unions are required to publish their accounts and financial returns online every year; corporations are not.

If the government were serious about putting unions and corporations on an even footing they could extend the current democratic and reporting requirements demanded of unions to corporations. But, instead, the government are saying to organisations that represent Australian workers: 'We reserve the right to micromanage you in a way that we would never dream of doing to a private company, but we'll impose the same penalties on you that we might on a publicly-listed company.'

But it goes further than that. The differences go to the very heart of why these organisations exist in the first place. Businesses exist to make a profit; that is what they do and what they are judged on. And Corporations Law requires directors to act in the best interests of their shareholders and to continue to make a profit. But unions exist to advance the interests of their members and, in so doing, to help all workers.

Unions advise people of their rights and entitlements at work and ensure that those entitlements are honoured. Unions ensure that the lowest paid workers enjoy something that we and others take for granted—a decent income and a quality of life. Thanks to unions we have got penalty rates that mean that people working unsociable hours get a decent income. Unions fought for shorter working weeks. Unions are responsible for the existence of the weekend. And it is thanks to unions that workers are entitled to annual leave and penalty rates. These things were not granted to workers by benevolent corporations; unions fought for every single one, and these are the things that are under attack by this government.

This legislation, by tying unions up in red tape, will reduce their ability to continue to work for the interests of their workers in the best way possible. Workers who are on very low pay and conditions and are represented by unions need their unions to be fighting at every opportunity they have for every benefit.

Childcare workers, aged-care workers, the cleaners at Parliament House—who are obviously in the news this week—and seafarers work on very low wages and conditions and are under attack, and the unions need to stand up for them to the best of their ability.

The continual attacks of this government, the undercutting of wages and conditions and the attacks on penalty rates basically will end us up with a system like the US or even worse, where conditions and pay are so bad that a worker working not just a 40-hour week but a 50-hour week, 60-hour week, working two, three, four jobs is still struggling to actually have enough money to survive, to put food on the table and to pay for their housing. We are better than that in Australia. We pride ourselves on being the land of the fair go. And side-by-side in the land of the fair go means that a decent day's work is rewarded by a decent day's pay.

The impact on our society of workers having to survive on unfair conditions and not enough pay means that their whole lives are just based around trying to survive, trying to just scrabble together enough money to be able to put the food on the table. It leaves them no ability to contribute anything else in society, no ability to be out there supporting their kids at sporting events on the weekend, no ability to contribute to community organisations; it is just a matter of survival, a matter of just struggling and scrabbling together to be able to continue living a life where they can pay the rent and put the food on the table. We are better than that. Attacking the ability of unions to fight for the rights of workers means that the very way of life of Australian society is under attack. Unions have fought for all of the conditions our workers are currently enjoying. In doing this, unions did not get a direct financial benefit. This is where unions and employer organisations are fundamentally different from profit-making companies and it makes sense that they should be treated differently.

The bill before us today is unnecessary. Current laws prevent officers of registered organisations from using their positions for their own personal benefit and those that do are prosecuted. But rather than extend the current requirements demanded of unions to corporations, the bill allows the government to micromanage unions in a way that would be unthinkable for private companies while still imposing the same penalties on unions as apply to publicly listed companies.

The motivation behind this legislation is clear: the government hopes to tie up workers and unions in an abundant amount of red tape to stop them advancing the interests of the people that they exist to look out for. And the bill is simply another stage of the government's attack on workers' rights. Just as successive budgets have revealed the true callousness of this government, this bill reveals the government's anti-worker agenda. The government may insist that Workchoices is dead, buried and cremated but it has simply learned that such blatant attacks have real electoral consequences. There is a reason that this government is in trouble because of these real electoral consequences. Its position in the polls reflects the entire anti-worker agenda; it is not in line with what the general population wants. This government is in trouble because it refuses to listen and is putting the big end of town ahead of the interests of Australians. The Greens will always stand up for the rights of workers and so will be secure in our position of opposing this bill.

Senator LINDGREN (Queensland) (12:26): I rise to support the Fair Work (Registered Organisations) Amendment Bill (No 2) 2014 and to support the workers of Australia. Transparency and accountability are the fundamental principles that allow the people of Australia to have faith and belief in the people or organisations that represent them. Transparency and accountability delivers integrity, peace of mind and, most importantly, good governance.

This bill will amend the Fair Work (Registered Organisations) Act 2009 to: establish an independent watchdog, the Registered Organisations Commission, to monitor and regulate registered organisations with enhanced investigation and information gathering powers; strengthen the requirements for officers' disclosures of material personal interests and to change grounds for disqualification and ineligibility for office; strengthen existing financial accounting, disclosure and transparency obligations under the act by putting certain rules of obligation on the face of the act and making them enforceable as civil remedy provisions; and increase civil penalties and introduce criminal offences for serious breaches of officers' duties as well as introduce new offences in relation to the conduct of investigations under the act.

Both employer and employee organisations make decisions, invest money and resources and advocate on behalf of their members. This is similar to registered companies making the same undertakings on behalf of their shareholders. Companies are bound by a number of legislative requirements and frameworks. They are there to ensure that the process by which a company operates: is within the law; is making structured sound spending or investment decisions on behalf of its shareholders; and, amongst other things, is not making decisions based purely personal gain or self-promotion. It is only a natural progression and an equitable outcome that our employer and employee organisations should be governed by the same robust governance. Those opposite will argue that tighter measures were introduced into the Fair Work Act legislation in 2012 and that the arrangement is now strong and efficient.

The front page of the newspapers across this country tell a different story, with regular, ugly news pieces about the blight of bullies, foul mouthed rogues and stand-over men within some of these organisations. The current regulations are just not working and due to that workers and businesses alike are suffering at the hands of self-regulated ideologists. As a member of a chamber of commerce, or a member of a workplace union, I would want to know who was running my organisation, what qualifications they have, what potential conflicts of interest may pertain to them, what they are being paid and where my money is being spent. This is not unreasonable nor should it raise eyebrows. Of course the chance of union bashing or witch-hunts will arise. Desperate times for those opposite call for desperate measures.

Judith Sloan, the contributing economics editor for The Australian, on 1 May 2012 wrote:

The reputational damage caused by the shenanigans at the HSU is likely to have led to a further hemorrhaging of members—this is already apparent in terms of resignations from the HSU. But the effect is likely to be more widespread. With the lack of transparency in union affairs, who can tell what other unions get up to?

The workers of Queensland deserve better than this. Sloan goes on to say:

The alternative strategy for the union movement is to embrace choice and competition and commit to high standards of governance. By providing real benefits to members in an open and transparent manner, there may be a chance workers can be attracted to join up.

As my colleague Scott Buchholz MP said when debating the bill:

… this bill enhances the union movement—in particular honest union members. What this bill seeks to rub out is what we see time after time in the Australian press: the word 'union' associated too many times with 'bullying', 'coercion', 'intimidation', 'thuggery', 'corruption' and 'royal commission' … The setting up of a royal commission stands to strengthen and enhance honest union membership.

In The Australian on 16 May 2012, Paul Howes of the AWU argued:

… 99 per cent of our movement has nothing to fear ... from more transparency, from being more open and ensuring we act diligently.

… If a dodgy boss rips off our workers … we hunt that boss down … and we make sure that they pay back to their workers what they deserve …

… And if we have a dodgy trade union official who rips off those workers, we need to hunt them down too …

During a submission to the Senate regarding the bill, the ACTU said:

The Bill is poorly conceived, badly motivated, and entirely unnecessary.

... It is … transparently political … in an area where there is no extant public policy problem.

Perhaps several front pages of newspapers and a royal commission would see that statement being revised at the moment. Again, I must draw the attention of the House and the ACTU to the current industrial affairs being played out across our nation, where a few rogues feel justified in holding the country to ransom on the back of their hardworking members' dues. I ask: does this not warrant a sensible consensus that action must be taken?

With regard to the criminal offence provisions contained through the bill, in particular proposed sections 337AB and 337AC, the evidentiary burden will be borne by the defendant with regard to their intent or reasonableness if charged under the provisions. This singular fact is itself a dissuader for one to indulge in contrary behaviour of that very type of bullying and harassment. How dare those opposite try and say that harsher penalties on people who scam hard-earned dollars from poor, unsuspecting workers are not appropriate? Go out and tell your members that they do not count, because that is effectively what you are saying. The 18 per cent of unionized workers will fall to 15 per cent, and maybe, just maybe, they will even cast a conservative vote.

The privilege that unions have of collecting money from their members to provide their members with fair representation is a myth if you are not prepared to back hard, tough laws against those delegates and leaders from the unions that seek to rort it.The workers need protection; the businesses need to employ more people; and you are available to help them here and now by supporting a bill that actually gets the bad guys. Whether they are union associated or employer associated, a bad guy is a bad guy. We make movies about it, and we all cheer when we get the bad guy. We teach our children in our homes and our schools that bad guys are just that—bad. This bill makes the bad guys pay and protects the innocent. It promotes security and encourages growth.

The Abbott government is committed to improving the Fair Work laws so that we can build a more stable, fair and prosperous future for Australia's workers, businesses and economy. The absolute need for this legislation almost goes without saying. The rorts, the rackets and the rip-offs have been in the media on almost a daily basis, and the wider community is strongly in favour of these reforms.

Until this parliament acts, Australia will not have a sufficiently robust system that ensures corruption is uncovered and eradicated before it becomes systemic—as it did in the infamous HSU case. It is simply no longer tenable to argue that the present system is adequate to deal with or discourage this kind of behaviour. Unions and employer associations play a critical role in workplace relations systems and the economy more broadly, and their members invest a great deal of trust in them. The community expectation is that these registered organisations will operate to the highest of standards. These organisations are given special legislated rights. With rights come responsibilities. We in the government believe that the majority of registered organisations do the right thing and in many cases maintain higher standards than those that are currently required.

The bill introduces legislative measures designed to see governance of registered organisations lifted to a consistently high standard across the board. A more robust compliance regime will deter wrongdoing and promote first-class governance of registered organisations. The Abbott government believes the Fair Work (Registered Organisations) Amendment Bill will provide the certainty and high standards of operation that members of registered organisations are entitled to expect. It delivers clarity to both employer and employee organisations about good governance of their charters and restores the faith of those people most at risk: the membership. I fully support the passage of this bill.

Senator URQUHART (Tasmania—Deputy Opposition Whip in the Senate) (12:35): I rise to speak on the Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2], and so here we go again. I do not know about you, but to me it is starting to feel a lot like industrial relations Groundhog Day. This is the fourth time that I have spoken in this place on this or a virtually indistinguishable clone of this bill. And, if common sense and rational minds prevail, this will be the fourth time that the Senate will say no to this part of the government's vindictive agenda to weaken unions that support Australian workers. This bill is identical to the one that was rejected by the Senate less than a year ago, and the amendments are identical to those that were voted out by the Senate in May 2014.

As I have addressed the specifics of this bill on three occasions so far in this place, I will not spend too much time on going over the same ground, just as the government did not spend too much time when they failed to amend this bad legislation before sending it back to the parliament. The measures in this bill have been consistently rejected by the Australian Senate and the Australian people. Let us be clear. This bill is not about improving productivity. It is not about fulfilling an election promise. It is about this government using every means at its disposal to weaken unions and, with that, weaken the Australian workers whom they represent. It is just one element of the government's agenda to decimate the power of workers and, in doing so, drive down working conditions and pay. The government wants us to believe that it is merely fulfilling a commitment made to the Australian people before the election. Of course, one glance at the government's form reveals this to be a laughable proposition, given the scant regard the Abbott government has shown for all the other firm commitments it made to the Australian people before they cast their votes in 2013.

Remember, this is the government that promised there would be no cuts to health, no cuts to education, no changes to pensions, no change to the GST and no cuts to the ABC or SBS. And we all know what has happened since then. Not only is it a nonsense that this government cares one ounce for honouring its promises, but this bill does not even do that. The actual promise that was made was that it would be the same for registered organisations as for corporations. This bill goes much, much further. Despite the promise that the bill would align the penalties for registered organisations with those for corporations, that is not what this bill would do. In fact, there are a number of areas in the bill which are inappropriate and extend beyond the provisions in the Corporations Act. For example, the maximum penalty for a 'serious contravention' of particular sections of the company act is $200,000 for an individual and $1 million for a body corporate. This is less than the amount in this bill. And, unlike the Corporations Act, the penalties in the bill will automatically increase as the value of a penalty unit increases. Not only that but the bill is very vague on what exactly constitutes a 'serious' contravention, other than to say that it is a contravention that is 'serious'. For these reasons, the bill is yet another broken promise from a government so far in trust deficit that even its own leader in Victoria has referred to Mr Abbott and his supporters as 'poisoning the well of goodwill for all other elected officials in the country'.

The bill also fundamentally fails to understand that registered organisations are not like corporations and their office holders are not akin to corporate executives. The truth is that, in many cases, it is rank-and-file members of unions that are elected as delegates to governing bodies. They are not there for a salary; they are there as members of the community who believe in supporting workers' rights. This bill would mean that many dedicated, ethical individuals make the difficult choice not to participate in their union. But, of course, that was always the plan: by threatening onerous penalties and obligations, the Abbott government would scare off many hardworking and committed individuals, making it more difficult for registered organisations to advocate on behalf of Australian workers. Of course, diminishing the power of unions to advocate on behalf of workers is part of the Liberal Party's reason for being. This bill directly seeks to deny Australians their fundamental right to representation by diminishing rank-and-file participation.

At this point, I want to be clear that Labor absolutely rejects any sort of misconduct, whether it be from union officials, business executives or even politicians. We support robust legislative processes that will ensure appropriate punishment is levied on those who break the rules. We will continue to fight for accountability and transparency. But we will not indulge the government's vindictive agenda of attacking the pay and conditions of Australian workers on every front. The truth is that, by any objective measure, Australia's industrial relations system is working.

Recent releases from the Australian Bureau of Statistics on Australian industrial activity show that our dispute levels are at lows we have not seen in generations. Days lost to industrial activity in the year to March 2015 are the lowest they have been since recording began. Notably, the highest number of disputes was recorded under the bad old days of Work Choices under the Liberal government. And we must not forget that these are the days that this government would love to see return. In fact, let us cast our minds back to what Prime Minister Tony Abbott said of Work Choices in March 2008:

The Howard government's industrial legislation, it was good for wages, it was good for jobs and it was good for workers. And let's never forget that.

No, Mr Abbott, we will not forget you said that, I can assure you.

Those opposite like to point to the HSU case to suggest that there is something inherently wrong with our industrial relations framework. They want the Australian people to believe that there is something fundamentally, systemically wrong with how unions work and how they are treated under the law. But the truth of the matter is: it is the case at HSU that shows exactly what we have been doing right in industrial relations. In the case of HSU, the Fair Work Commission collected evidence and the courts made their verdict, as they should do. Due process was followed, a decision was made and appropriate punishment was levied. The system worked exactly as it should. We have got the balance right, and the avenues to address corruption and misconduct are robust.

The truth is that the Fair Work (Registered Organisations) Act already allows for criminal proceedings being initiated where funds are stolen or are obtained by fraud. It already ensures that the Fair Work Commission can share information with the police as appropriate. It already provides for statutory civil penalties where a party knowingly or recklessly contravenes an order or direction made by the Federal Court or the Fair Work Commission under the Fair Work (Registered Organisations) Act or the Fair Work Act. Under the Fair Work Act, officers of registered organisations already have fiduciary duties similar to those for directors under the Corporations Law. The Fair Work (Registered Organisations) Act already requires officers to disclose their personal interests. The Fair Work (Registered Organisations) Act already requires officers to disclose when payments are made to related parties. And the Fair Work (Registered Organisations) Act already requires officers to exercise care and diligence, act with good faith and not improperly use their position for political advantage. So clearly this bill is not about better governance and accountability. We already have that. And, despite what those opposite would have you think, there is nothing in the bill before us today that would stop people committing fraud.

The bill was recently put under the microscope by the Senate Standing Committee for the Scrutiny of Bills. This committee reported on the bill in its Fifth report of 2015, drawing attention to a lack of detail on new offence provisions that the minister had failed to address in the explanatory memorandum to the bill—not once, not twice but three times.

Unsurprisingly, the committee noted its disappointment at the minister's absolute and ongoing failure to address these issues. Similarly, The Parliamentary Joint Committee on Human Rights reviewed the legislation and found that the new offence of concealing documents relevant to an investigation could be incompatible with the right to a fair trial and fair hearing because it imposes a reverse legal burden of proof on the defendant, limiting the defendant's right to the presumption of innocence. This is clearly a bill that will not address the problem that it seeks to confect. It is yet another attack from the Abbott government on the ability of unions to represent Australian workers.

Of course, this is not the only avenue the government has used to try to weaken the union movement. As I mentioned earlier, there have been four iterations of this malignant legislation. But it is far from an isolated example. In fact, we have seen a concerted campaign by this government using every option available to them to weaken unions. Just this morning we saw the government's bill to re-establish the repugnant Australian Building and Construction Commission. This toxic legislation will discriminate against construction workers and expose them to harsh laws that do not apply in any other industry. Then we have the most notable evidence of Mr Abbott's campaign of vengeance toward unions: the witch-hunt masquerading as a royal commission into union activity. Again, this is in the Liberal's DNA. In fact, there has not been a Liberal government for more than 40 years that has not held an inquiry of some sort into union activity.

The Abbott government's royal commission into trade unions is the most egregious use of public money for transparently political purposes that I have seen in a while. In fact, the government is spending $80 million of taxpayers' money on this charade; $25 million of this is going directly to lawyers employed to prosecute the government's case. The Attorney-General's own former employer, Minter Ellison, does particularly well out of it, getting $17 million. What a waste of scarce resources from a government that not so long ago could not stop screeching about Australia's debt and deficit problem. But that was until they doubled the deficit—but that is a whole other story of wanton waste. Not only did they set up a wasteful commission; they also extended the commission for no justifiable reason.

If we needed further evidence that the royal commission is a politically motivated sham, then it came last week with the revelation that the royal commissioner himself, Dyson Heydon AC, was also set to be the star keynote speaker at a Liberal Party fundraiser. Invitees were clearly told that the income from the event would go to the state branch of the party for the next election campaign. Even in his own email pulling out of the event last week, Mr Heydon said that he would still be willing to appear at future Liberal events. Clearly, this revelation casts a shadow over Mr Heydon's impartiality and, clearly, it makes a mockery of the impartiality of the whole commission process.

Leader of the Opposition, Mr Bill Shorten, was absolutely right when he called out this 'smoking gun of political bias'. When the government was faced with this undeniable truth last week, the response was unbelievable. The Prime Minister could not even maintain a consistent position, contradicting himself over whether the event was a fundraiser or not, giving two totally different definitions. Then, Attorney-General George Brandis went in another direction entirely, saying that it was not even a party political event at all. Mr Abbott relied on the words of Julian Burnside to bolster his argument that there is nothing to be concerned about. He failed to recognise Mr Burnside's full comment on the matter, which was:

Heydon is an honourable man. I give him the benefit of the doubt. Maybe he is honourable enough to step down.

He further outlined his position to Fairfax newspapers:

I think an honourable person caught in that position would step aside.

Truly, you could not make this stuff up. Mr Burnside's perspective was reinforced by Monash University Professor Julian Teicher, who said:

I think the problem here is that to make the findings of this royal commission as credible as possible, Justice Heydon needs to appear—not just to be—absolutely independent.

In fact, in a similar circumstance, Mr Heydon put forward a very similar point of view when he discussed the importance of appearing to be fair in the case of British American Tobacco Australia Services v Laurie. On this matter, Mr Heydon wrote:

It is fundamental to the administration of justice that the judge be neutral.

It is for this reason that the appearance of departure from neutrality is a ground of disqualification ... because the rule is concerned with the appearance of bias, and not the actuality, it is the perception of the hypothetical observer that provides the yardstick.

Clearly, this proves that Mr Heydon's position is now untenable and reveals the royal commission for what it is—a very expensive, taxpayer-funded witch-hunt. While this is undoubtedly true, we need to be aware that the motivations behind the royal commission were not just an attack on political opponents. The reality is that whatever political pain this royal commission was intended to inflict, it betrays a wider and much more malignant agenda of driving down the pay and conditions of Australian workers. By attacking the groups that represent workers, the government is also directly attacking the power of the workers to secure fair pay and conditions.

The reality is that wage growth is at the lowest point it has been in decades. Economists will tell you that we need solid wage growth if we are to keep our economy moving. Increased wages lead to increased spending, which leads to a healthier economy. The greater the spending power of the workers, the more money flows through the economy, the more profitable are businesses and the more workers they can employ. In attacking unions, those opposite are seeking to cut this cycle and further entrench inequality. In doing so, they would encourage a trend for the financial resources of society to flow to the top.

Inequality is one of the greatest issues facing our economy. When the richest seven Australian individuals hold more wealth than more than 1½ million households in the bottom 20 per cent, something has gone seriously wrong. When senior executive pays are 100 times average weekly earnings then something needs to change. But the Abbott government's union bashing agenda will only serve to further entrench inequality and to further divide our society into the haves and the have-nots.

Recent research by the International Monetary Fund found that unions are a force for greater equality. Research undertaken by IMF economists Florence Jaumotte and Carolina Osorio Buitron found strong evidence that a decline in unionisation is directly related to the rise in incomes for the richest 10 percent of peoples. They saw that a drop in union membership is correlated with steep increases in income at the top and a growing gap between those with wealth and the working poor. Of course, it makes perfect sense.

In many industries, it is only through banding together that workers can overcome inherent power imbalances and negotiate fair outcomes. Lower union membership reduces workers' bargaining power, which means that executives and shareholders can get higher returns if workers do not have the power to secure fair pay. This lack of bargaining power also feeds into a growing inability to influence corporate decisions, which can further entrench benefits for those at the top of the company hierarchy at the expense of workers.

The working poor are an increasing and shameful reality in this country. The minimum wage is failing to keep pace with inflation while executive salaries continue to rise. But those opposite are doing everything they can to attack Australian workers. In fact, from the time they got the keys to the ministerial wing, those opposite have done everything they can to achieve just this. They took away pay rises for childcare workers. They axed pay rises for aged care workers. They announced the sacking of 16,500 public sector workers despite promising only 12,000 job losses before the election. They brought in draconian offers for the remaining public servants which would strip rights out of enterprise bargaining agreements, cut conditions and drive pay rises to below inflation.

They have failed to negotiate a single public sector agreement, 12 months after 116 of them have expired. They goaded Holden to move offshore and lied about Toyota's reasons for pulling out of Australian by trying to blame it on workers and unions. They set out to sabotage the shipbuilding industry by breaking their election promise to build submarines in South Australia. They virtually froze investment and job creation in the renewables industry by breaking their pre-election promise that there would be no changes to the renewable energy target.

They reopened a 457 visa loophole, which the former Labor government closed up, to allow employers to hire an unlimited number of workers without scrutiny. They signed a free trade agreement with China, which allows companies with large projects to bring in foreign workforces with none of the requirements to consider local labour firsts.

They oversaw a Productivity Commission inquiry which has recommended cutting penalty rates, lowering minimum wages and expansion of individual contracts. They put forward coastal shipping legislation, which would see the wholesale foreign flagging of Australian ships and opens the door to massive foreign work forces taking over these ships. And when Australian jobs are on the line, as in the case of Caterpillar in Burnie and the Alexander Spirit, which was docked in Devonport, they have not lifted a finger to fight for these jobs at all.

As I have outlined, the legislation before us today is yet another example in a long list of Mr Abbott's anti-worker agenda, and I urge senators in this place to stand strong against it and vote it down.

Senator BILYK (Tasmania—Deputy Opposition Whip in the Senate) (12:55): First up this morning we had the bill to revive the ABCC, and now we have this bill. In addition to the Abbott government's farcical Omnibus Repeal Day, they appear to have instituted a new legislative tradition—attack the union movement day. Should this be any surprise from the sworn enemies of the trade union movement—the Liberal Party—who will do anything for their mates in big business? However, ask them to support workers, which is who the unions represent, the working people of this country—no way will they do it. As sad as I am to say it, the National Party, who once at least pretended to represent rural Australia, now just follow blindly after their Liberal masters.

It follows a pattern of behaviour of failed political attacks against workers and the union movement from those opposite. The latest failure—the Abbott government's $80 million political witch-hunt in the form of the trade union royal commission—has spectacularly failed. It has been revealed to be the partisan exercise that Labor always knew it was. It was clear from the outset, from the terms of reference of the inquiry and the intentions of this government, that this royal commission was an exercise in politics, not justice. It has been made clearer by the fact that the commission has been going beyond its brief of exposing corruption instead of starting to pursue legitimate industrial activity.

You would think that anyone who took on the job to conduct such a blatantly political inquiry would have already shown their true colours. But the fact that royal commissioner Dyson Heydon accepted an invitation to speak at a Liberal Party fundraiser exposes this inquiry for the political exercise that it is. The invitation was very clear that it was a political fundraiser. It said that any funds raised were to go to the state Liberal Party, so there could have been no mistake regarding that. Justice Heydon should now seriously consider whether his position is tenable.

Of course, when the royal commission is concluded, those looking at its conclusions should do so through the prism of the political nature of the inquiry and the man leading it. Not just content with using the royal commission as a proxy for its attack on unions and workers, the Abbott government has also used the Productivity Commission and the parliament. The bill we are debating now is the fourth version of the government's attempts to silence the union movement by burying it in red tape. We have had one private senator's bill and three government bills in as many years trying to introduce this very regime under the guise of regulating registered organisations. But don't be fooled: this is not about good governance for registered organisations. There is no policy justification for this bill. It is a political exercise aimed at attacking the political opponents of the Abbott government and using employer organisations as collateral damage.

It is deliciously ironic that one of the bills listed for debate after this one on the red is the Omnibus Repeal Day Bill—a bill where the government goes through the farcical exercise of removing outdated provisions and correcting punctuation under the guise of reducing red tape. They come in. They make a huge song and dance about it They are actually removing commas and full stops and putting the correct punctuation into the bill, but they make it sound like they are doing something glorious. The government love to trumpet their pretentious attempts to cut red tape for business, but when it comes to the business of being a registered organisation they go in the opposite direction, introducing onerous requirements and exorbitant penalties for the failure to meet those requirements.

Labor, in government, already strengthened disclosure requirements, accountability and transparency for registered organisations through legislative changes in 2012. At the same time, we tripled penalties for breaches of the legislation. Let me remind those opposite, as I did in my speech in February this year, of the governance and accountability provisions that are already contained in existing legislation in the Fair Work Act and the Fair Work (Registered Organisations) Act. Officers of registered organisations already have fiduciary duties similar to those for directors of corporations. Officers are required to disclose their personal interests and when payments are being made to related parties. Officers are required to exercise care and diligence, act with good faith and not improperly use their position for political advantage. It is prohibited to use the funds of members of registered organisations in internal elections. Criminal proceedings can be initiated where funds are allegedly stolen or obtained by fraud, and the Fair Work Commission can share information with the police as appropriate.

These provisions are tougher than those that existed when the current Prime Minister was minister for workplace relations under the Howard government. To see that this bill is a blatant political exercise, we need only look at the timing of it in relation to the Royal Commission into Trade Union Governance and Corruption. The government have initiated an inquiry into the governance of, and corruption in, trade unions, yet they have introduced this bill to this place four times. Why would you spend $80 million of the taxpayers' money on a royal commission if you claim to already have the answer? That is what they do by trying to reintroduce this bill.

Of course, there is plenty of further evidence that this bill is ideological. Take, for example, the fact that the government puts so much political capital into tackling corruption and malfeasance in the trade union movement, yet in the financial services area, where corruption was vastly more widespread, this government proposed legislation that would actually water down the regime designed to protect consumers. It actually wanted to water it down. You can tell that the Abbott government has overreached with this bill when, time and time again, even its friends in business have criticised it.

There was a Senate inquiry into the second iteration of this bill, the 2013 bill, and I will remind you again what the Australian Industry Group, a registered employer organisation, said about this bill. The Ai Group submitted:

The Bill would impose a far more onerous regime for officers of registered organisations than what applies to directors of public companies. The regime, if enacted, would undoubtedly deter persons from standing for office in employer organisations. In practice the provisions of the Bill would seriously impede many organisations from carrying on their daily business operations.

Just let me repeat that last line again:

… the Bill would seriously impede many organisations from carrying on their daily business operations.

It is not that this should be a surprise to any of those sitting opposite. It is exactly what this bill is designed to achieve, so they should understand that.

There are onerous requirements in this bill that will be imposed on individuals who choose, often on a voluntary basis, to dedicate their time to a body which represents employers or employees. These requirements are akin to those that would apply to the board or CEO of a major company. We should recognise that corporations and registered organisations serve very, very different purposes. Corporations are designed to generate wealth and advance the financial interests of their shareholders. Registered organisations are established to represent the rights of their members. But this regulation goes even further, extending to every branch of every organisation, regardless of size—every branch of every organisation, regardless of size. As the Australian Council of Trade Unions has pointed out, it is like saying that the rules that apply to the board of Woolworths also apply to a management committee in each individual store. It is just bizarre.

Those who take on official roles as officials and board members in trade unions rarely, if ever, receive the sort of remuneration of board members and executives in for-profit companies. As I have said before, many of them work in a voluntary capacity and receive no remuneration at all, yet the onerous reporting requirements imposed by this bill and the penalties for not meeting those requirements are so great that there are many roles within registered organisations that will simply go unfilled because there is too much risk in taking them on.

This, as I said, is the coalition's fourth attempt to kill the union movement by regulation, because the other three were most rightly rejected by the parliament. You have to wonder why this government persists with its attack on workers and the trade union movement when every attempt is a spectacular failure.

When they introduced Work Choices in government without a mandate to do so, they faced a fierce backlash not just from the union movement but from the Australian public broadly and were voted out of government. They have released a series of failed bills aimed at attacking the rights and entitlements of Australian workers, which have rightly been rejected by the parliament. Their politically driven trade union royal commission has been exposed as the expensive political witch-hunt that it is with the commissioner's acceptance—as I said—of an invitation to a Liberal Party fundraiser being exposed. One wonders what the outcome would have been if his acceptance had not been exposed. Would he have turned up? Would he have spoken? Who is to know?

The exposure of the royal commission as a partisan political exercise has absolutely destroyed the effectiveness of this $80 million attack on the government's political rivals. That is $80 million basically down the gurgler. When it comes to workplace relations, this government is like Monty Python's black knight, continuing its attack again and again despite having each and every limb hacked off. That is what this government remind me of. They persist with their ideological attacks against workers' rights and unions, even when they are routinely rejected by the parliament and the Australian public—but I suppose they cannot help it. A bit like Pavlov's dogs, who salivated every time they heard a bell ring, this government salivate at the mere thought of attacking the union movement and, in so doing, attacking the working people of Australia who are members of those unions and reintroducing elements of Work Choices. It is in their DNA.

This bill is a solution waiting for a problem. When Labor introduced the Fair Work Act and associated bills, we reduced industrial disputation, we increased labour productivity and, through later amendments, we increased compliance for registered organisations. Labor do not support this blatant political attack on the union movement, and we will oppose this bill. This is a bad bill from an even worse government.

Senator JOHNSTON (Western Australia) (13:08): The Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2] is a very important piece of legislation, one which I have to say I would have thought, given recent events in the public domain—particularly the cases of Craig Thomson and Mr Michael Williamson—the Labor Party, in representing the actual workers who subscribe union dues to these unions, would welcome. I would think that any right-minded person seeing some of the most lowly paid workers and union members in our country being just nakedly, cruelly and cold-bloodedly ripped off by the likes of Craig Thomson and Michael Williamson would welcome this legislation, would welcome increased accountability and would welcome greater surveillance of positions of trust held by union officials.

Having cut my teeth as a young lawyer in Kalgoorlie, acting for both unions and for companies, I am left with the clear understanding that, in certain circumstances, workforces do need the representation of the union movement, the labour movement. In the 1930s in Kalgoorlie many workers suffered from silicosis, and it was the union movement that came to their assistance in dealing with that blight. But then I look at what has been happening in recent times—in the last 10 or 20 years or so. Union dues provide a very large corpus of money to be used in administration. What we have seen with respect to Mr Thomson and Mr Williamson has been a complete breakdown in fidelity and trust and a complete breakdown in loyalty to those Hospital Service Union members.

This piece of legislation establishes an independent watchdog, the commission, to monitor and regulate registered organisations with enhanced investigation and information gathering powers. It strengthens the requirements for officers to disclosure material personal interests and related voting and decision-making rights. In other words, it increases the surveillance on conflicts of interest so that wives and relatives cannot do work for the unions, as was the case with Mr Williamson. The bill strengthens existing financial accounting, disclosure and transparency obligations under the Registered Organisations Act by putting certain rule obligations on the face of the act and making them enforceable as civil remedy provisions. It also increases civil penalties and introduces criminal offences for serious breaches of officers' duties and introduces new offences in relation to the conduct of investigations under the Registered Organisations Act. The bill clearly intends to bring the obligations on union officials and those charged with the administration of union funds into the same realm as those of company directors, which I think is a very, very good thing because the trust and integrity involved in the role of such officials are very, very similar.

The government is committed to improving the fair work laws so that we can build a more stable, fair and prosperous future for workers, particularly from the perspective of transparency. Transparency as to where a union member's dues end up and how they are applied is a very important part of the way our industrial laws function. The need for this legislation really does go without saying. We have witnessed massive rorts, racketeering on an amazing scale and rip-offs that have been the subject of night after night of sensational media reporting. Clearly, any responsible government cannot sit on its hands and watch the sort of thing that has gone on—particularly exampled by Thomson and Williamson.

The charges and allegations against both of those people in their capacity as officers of the Health Services Union were, quite simply, shocking and completely unacceptable. Thomson was arrested in respect of more than 150 fraud related charges and is facing allegations that his 2007 election campaign was partly funded by siphoning union money without authorisation. Mr Williamson pleaded guilty to misusing almost $1 million of Health Service Union member funds. I pause to say that I think that we can all acknowledge that Health Service Union members—those men and women inside hospitals who do the cleaning and the menial tasks—are some of the lowest paid people in Australia today. And Mr Williamson, in a very callous and cold-blooded way simply ripped them off—just ripped them off. I find that completely and totally unacceptable. There are some who might want to say that that is not representative. We have seen charges from the royal commission, and the royal commission is setting out a litany of this sort of abuse of power by union officials. Members of the Health Services Union are asking how these gross breaches of trust—the Thomson and Williamson sagas—can occur. The obligation on this parliament is to, firstly, respond to the fact that Mr Williamson has pleaded guilty—and I underline that. That is, he has admitted and accepted that, in a guilty way, he simply stole the money of the members of this union. He has accepted that he was and is dishonest, and that he ripped these people off. Accordingly, the government seeks to act. I think this legislation is very well balanced in seeking, as I have said, to increase the transparency to provide the transparent powers for a commissioner to investigate such matters.

The bill introduces a suite of measures designed to see governance of registered organisations lifted to a consistently high standard across the board. That is so understandable in the face of what we have witnessed and so required that the parliament and the government should be congratulated for responding in the way that it has with this legislation. A more robust compliance regime will deter wrongdoing and promote first-class governance of registered organisations. In order to improve oversight of registered organisations the bill will establish a dedicated, independent watchdog—the Registered Organisations Commission—to monitor and regulate registered organisations and to provide them with enhanced investigation and information-gathering powers. The new commission will have the necessary independence and powers to regulate registered organisations effectively, efficiently and transparently. The commission will be headed by the Registered Organisations Commissioner, who will be appointed by the minister. The commission will have stronger investigation and information-gathering powers than those that currently apply. These will be modelled on those available to the Australian Securities and Investment Commission, which will further enhance the ability of the commissioner to provide strong and efficient regulation of unions and employer associations. The commission will have the power to commence legal proceedings and to refer possible criminal offences to the DPP or law enforcement agencies.

In this legislation we are also increasing the penalties. For serious contraventions the maximum penalty will be increased to 1,200 penalty units, which is approximately $200,000—I think the units are worth $170 each—and for corporate breaches the penalties will be increased to 6,000 penalty units, which is about $1 million. I think the penalties for these sorts of breaches of trust, faith and abuse of power are very appropriate.

I want to pause to go over why the government is doing this. Of course, I need go no further than to deal with what happened with respect to Mr Craig Thomson, who was in fact a Labor Party member of this parliament. The Fair Work investigation into the Health Services Union national office identified a total of 181 contraventions of the Registered Organisations Act and the Health Services Union rules by the union officials and others. The claim against Mr Thomson included 37 alleged breaches of general duties imposed on officers of registered organisations and 25 alleged breaches of the Health Services Union rules. Mr Thomson was convicted of criminal charges in the Melbourne Magistrates' Court, on 18 February 2014. He subsequently appealed and, to the best of my understanding, was convicted of 13 charges of theft. As outlined in a statement made by the Fair Work Commission General Manager, Ms Bernadette O'Neill, on 18 February, Mr Thomson's criminal conviction will impact the civil proceedings, as the Registered Organisations Act provides that any corresponding civil proceedings that have been stayed will automatically be dismissed.

Let's deal with what was confronting law enforcement agencies when an investigation was carried out into the activities of Mr Thomson. On 31 January 2013 Mr Thomson was arrested by New South Wales Police in relation to allegations of fraud against the Health Services Union by Victorian police. The trial began on 2 December 2013, with Mr Thomson pleading not guilty to over 145 fraud-related charges. On 18 February 2014 Mr Rozencwajg found Mr Thomson guilty of using credit cards issued to him in his role as National Secretary of the Health Services Union between 2002 and 2007. So for five years this person apparently treated the Health Services Union as his own private banker.

Senator Cameron: Just like Bronwyn Bishop did in parliament!

Senator JOHNSTON: I am happy for Senator Cameron to defend this person.

Senator Cameron: I am not defending—

The ACTING DEPUTY PRESIDENT ( Senator Williams ): Order!

Senator JOHNSTON: He cannot resist interjecting, because he knows this is an absolute blot on the labour movement. The labour movement does have a lot to be proud of, but this is not one of those things. This is a disgrace.

Senator Cameron interjecting—

Senator JOHNSTON: The sooner Senator Cameron owns up to the fact that—

The ACTING DEPUTY PRESIDENT: Senator Johnston, direct your comments through the chair, please.

Senator JOHNSTON: Thank you, Acting Deputy President. The sooner Senator Cameron owns up to the fact that this legislation will stop the likes of Craig Thomson and Michael Williamson, the better off we will all be.

Senator Cameron: And Bronwyn Bishop!

The ACTING DEPUTY PRESIDENT: Senator Cameron! Order on my left!

Senator JOHNSTON: The magistrate found Mr Thomson guilty of stealing HSU funds and obtaining financial advantage by deception when he used the union's credit card to pay for escort services, cigarettes, firewood, travel expenses for his ex-wife and when he withdraw nearly $10,000 in cash from ATMs. On 25 March 2014 Mr Thomson received a sentence of 12 months imprisonment, but with nine months suspended. Mr Thomson launched an appeal and, as I have said, I think that 13 of those charges of theft were sustained upon appeal. Mr Thomson was formally expelled from the Labor Party on 4 April 2014. Bear in mind, these offences were carried out between 2002 and 2007. So more than seven years after the offences were committed, Mr Thomson was expelled from the Labor Party.

I turn to Mr Michael Williamson. On 4 October 2012, former Health Services Union national president and former national president of the Australian Labor Party, Mr Michael Williams was arrested by New South Wales Police and charged with 20 criminal offences. Mr Williamson was charged with a further 30 offences before all 50 charges were combined into four major charges. On 15 October, Mr Williamson pleaded guilty to those four charges including defrauding the Health Services Union of almost $1 million through the creation of false invoices. He was also charged with two new counts over his alleged attempts to hinder police investigations. Not only did he ultimately accept his guilt but also he accepted that he sought to avoid that guilt by hindering police investigations. This was a man who was president of the Australian Labor Party. What a blot on the landscape for that political movement.

A full-day sentence hearing was held on 3 March 2014 in that New South Wales District Court. On 28 March 2014 Judge David Frearson of the New South Wales District Court sentenced Mr Williamson to 7½ imprisonment. He will be eligible for parole after five years. This person, who callously ripped off the workers in the Health Services Union, was the president of the Australian Labor Party.

On 4 April 2014, Mr Williamson was formally expelled from the Labor Party at a meeting of the New South Wales administrative committee. Media reported in October 2013 on a settlement of $5 between Mr Williamson and the New South Wales division. He was charged with $1 million but the settlement to the union was $5 million. Clearly, in a civil sense, the breach was even bigger than the criminal offences. This is an absolute disgrace and clearly the law was inadequate. The assistance that the legislation gave to the investigators was inadequate and we seek to remedy that problem right here and now. On 11 December, The Australian Financial Review reported that:

The NSW division of the Health Services Union is attempting to recover $2.4 million it alleges was overcharged under a secret commission arrangement involving former secretary Michael Williamson , his ex-mistress Cheryl McMillan and a former director of a supplier to the union, Alf Downing.

Proceedings against Mr Williamson did not proceed due to a settlement being reached. However, proceedings against Ms McMillan and Mr Downing are continuing. On 16 October 2013 the members of that union were given the happy news—I say that sarcastically—that Mr Williamson had applied for bankruptcy. The union members received no justice whatsoever in this. Of course, Mr Williamson did not give back the money he had purloined nefariously.

We then saw what happened with respect to Ms Kathy Jackson. It was reported that she had used legal fees totalling several hundred thousand dollars to defend matters which she was unauthorised to defend and the Health Services Union is seeking some $400,00 with respect to unauthorised use of funds.

Those three examples, in my respectful opinion, mean that this legislation is necessary and that this parliament must continue a very active surveillance, as it does with company directors, as it does with people charged with the administration of moneys from membership subscriptions and from shareholders. It is all very similar. The common threats are obvious and people who seek to say this legislation is wrong and not needed are living in a dream world.

Senator BACK (Western Australia) (13:28): I rise to support the Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2] and I look forward to it being unanimously supported in this chamber. In fact, we already have an indication that the Labor Party, when in government, had themselves introduced amendments contained in the Fair Work (Registered Organisations) Amendment Act 2012, demonstrating at that time that their certainly was, in the view of the Labor government at the time, a need for increased financial accountability of registered organisations, strengthened investigatory powers and increased penalties. One would think we are all singing from the same sheet of music.

Those amendments were not adequate; they did not go far enough. Indeed, they contained some clauses that were totally unnecessary and required the coalition in government to address—for example, full financial accounting by people who really had little if anything to do with the financial accountability or financial reporting.

Secondly, there was the inadequacy of the original Labor government amendment, which I remember speaking to at the time and pointing out the fact that there were onerous demands for training, particularly in economics, accounting and accountability upon some people acting where their role would not take them to a requirement for that sort of training, and even more foolishly for people who were already professionals in that space. They were not to receive any immunity.

This bill does a number of things to improve what were the then Labor government's amendments in their Fair Work (Registered Organisations) Amendment Act 2012. They are: firstly, to strengthen the reporting and disclosure obligations to align more closely with the Corporations Act, which of course stands in good stead and which has such a critically important oversight role in the management of corporations in this country; secondly, moving the obligation from the rules of registered organisations to the face of the legislation itself; and, thirdly, the amendments that we are discussing here today, and upon which I hope there will be full unanimous support, give the new commissioner greater scope to ensure that officers are complying with their obligations and greater powers to investigate when a member makes a complaint—when a member makes a complaint—about a registered organisation. So, here we are speaking about people who are themselves members of that organisation.

There is little doubt at all that the community expects the highest levels of accountability and transparency from anybody charged with responsibility for the monies of members and the monies of shareholders and, ultimately, the confidence of the wider community—be they corporations, employer groups or registered organisations in the context of unions—in being accountable to their members. As I said, this is an area in which we would expect to see full agreement, because there would not be anybody in this place—surely!—who would not agree that there must be, in the context of the dollars which are handled and which are actually contributed by members of registered organisations, employer organisations and, indeed, corporations, the highest standard of accountability and transparency to make sure there are none of the unfortunate events that we have seen in recent years and which have been canvassed adequately this afternoon by my colleague Senator Johnston.

So, what does the bill do? The first thing is that it establishes an independent watchdog—the Registered Organisations Commission—to monitor and regulate registered organisations with enhanced investigation and information-gathering powers. As we have seen in the events of the last four or five years—as we have seen spelled out in the media, in the courts and, indeed, in this place—it has been an inability to undertake adequate investigation and to compel the provision of information that has led to the ludicrous positions that we have had.

The second thing the bill does is to strengthen the requirements on officers—disclosures of material personal interests and related voting and decision-making rights—and to change the grounds for disqualification and ineligibility for office, be that in an employer group, in a union group or in any other registered organisation. Thirdly, as one would expect, the commission's role will be to strengthen existing financial accounting, disclosure and transparency obligations under the act itself by putting into place regulations and obligations on the face of the act and making them enforceable as civil remedy provisions. And, fourthly, it will increase those civil penalties and introduce criminal offences for serious breaches of officers' duties, as well as introduce new offences in relation to the conduct of investigations under the Registered Organisations Act. Therefore, as I said, what is necessary is a circumstance that will ensure community confidence—that we are building a stable, fair and prosperous future for Australia's workforce, for Australia's businesses and for the wider Australian economy.

Why is there a need for this legislation? Because we have seen the rorts, we have seen the rackets and we have seen the rip-offs in both employer groups and in union groups. We have seen this in the media and we have heard of it in the courts. We have actually heard about it in this place. And we know that they have been so frequent that the wider community has spoken strongly. Indeed, when the coalition first released its policy for better accountability and transparency of registered organisations in April 2012, some 15 months before the 2013 election, it received widespread public support. The Australian parliament must act. We will not have a sufficiently robust system to ensure that the sort of corruption that has been revealed in numerous and recent scandals is stopped until or unless we actually introduced this legislation.

It is no longer tenable to argue that the present system is adequate or that it is discouraging the type of behaviour about which we have heard and of which we will no doubt hear more. It is the case that union and employer associations play a critical role in workplace relations and the economy more broadly in this country. Their members, be they members of employer groups, unions or other registered organisations, invest an enormous amount of time and money and a great deal of trust in these officers. Unfortunately, we have seen too many instances on both sides where those confidences have been abused and where funds have been misappropriated and, indeed, we have seen the end result. There is a community expectation that registered organisations will operate to the highest of standards, and this legislation will ensure that that does take place.

The organisations are given special legislated rights. But with rights come responsibilities and with responsibilities come accurate management, probity and transparency, and complete and full reporting.

The government believes that the majority of registered organisations in this country do the right thing, and in most instances maintain higher standards than perhaps even those that are currently required. But our recent investigations into the Health Services Union, for example, illustrate that financial impropriety has occurred under the current governance regime for registered organisations. The charges and allegations against former member of parliament Craig Thomson and former ALP national president Michael Williamson in their capacities as officers of the HSU—and now Ms Kathy Jackson—are shocking. They are unacceptable, and the wider community wants action taken.

Senator Johnston spelt out some of those areas into which Mr Thomson, and indeed Mr Williamson found themselves. All I can do is remind those who might be attendant upon this session to reflect on the background of most of the people who pay union dues in the health services sector. Those of us who have had relations in aged-care facilities, for example, know very well the devotion of these people. We know they are not highly paid.

I recall, when matters associated with Mr Thomson were being discussed in this place, being informed of a lady of eastern European descent who had been working—and still is working—in the health services sector. She had paid, from a fairly modest salary, her union dues over many years, and somebody had calculated that, if she had today all those union dues she had paid—which we now know were totally abused and misappropriated by Messrs Thomson and Williamson, and possibly Ms Jackson—she could have afforded to go back to her native country in eastern Europe. Her response was: 'No. If I had that money available to me today I would not go back to my original homeland. I would want to put those funds towards the education of my grandchildren.' That really resonated with me. How those two or three people could possibly have done what they did with funds of workers in low-paid jobs in the health services sector is something they themselves are going to have to come to terms with into the future.

The bill introduces a suite of legislative measures designed to see governance of registered organisations lifted to a consistently high standard across the board. We require a more robust compliance regime, which is going to deter wrongdoing and promote first-class governance of registered organisations. We are a leading world economy; surely, we should not see the sorts of abuses that we have seen unfortunately unfold in the last couple of years.

We know that Fair Work Australia took far too long with their investigations in the Health Services Union. We know that the legal proceedings that ensued should well and truly have been brought to a head much more quickly. I recall, as deputy chairman of the committee at the time, a KPMG review into Fair Work Australia's investigations into the HSU which identified shortcomings in the conduct of the investigations. Members of that union and the wider community not only want a strong regulatory regime to give them confidence in these organisations; they also want swift action taken when standards appear to be breached or have been breached. To do this, we have to have a robust regulator in place with appropriate powers and resources, together with meaningful sanctions. That is what was absent when Fair Work Australia conducted those investigations. Those of us who sat through Senate estimates hearings at that time were extremely disappointed—those from both sides of the political divide—as to the tardiness. It was clear that there was not a robust regulator in place. This is what this legislation aims to achieve.

To improve oversight of registered organisations the bill will establish a dedicated independent watchdog, the Registered Organisations Commission, to monitor and regulate organisations and provide it with enhanced investigatory and information-gathering powers. The commission will have the necessary independence and powers—and reporting obligations, incidentally—that it needs to regulate organisations. The commission will be headed by a commissioner appointed by the minister. The commission will be required to report to the Minister for Employment annually on its activities; that report will be tabled in parliament, and the commissioner will appear at Senate estimates on each occasion that the Senate requires.

The activity of the commission will be subject to the same oversight by the Commonwealth Ombudsman as Commonwealth agencies. It will ensure appropriate levels of transparency and public accountability by the commissioner himself or herself. And, as is common with statutory officeholders, the minister can give directions of a general nature to the commissioner, but they must be in writing and they are a disallowable instrument. For avoidance of any doubt, I want to make the point strongly: the minister will not have any powers to give directions as to a particular matter or an investigation.

The commission will have stronger investigatory and information-gathering powers than those that currently apply, but they will be modelled on something that already exists and those are the powers available to the Australian Securities and Investments Commission. So this will further enhance the capacity of the commissioner to provide strong, efficient regulations of employer associations and unions, with all of those reporting and accountability requirements to the people who sit in this chamber.

Under the bill, there will be appropriate sanctions against efforts to hinder or mislead investigations—something that, as we know, dragged out the course of recent events in the HSU. It will give all members of registered organisations confidence that, should they make a complaint to the commission about the organisation of which they are a member, that organisation and its officials must comply with the requirements of the investigatory process, or they will face sanctions.

Members of registered organisations can have the confidence that, under this new legislation, a person convicted of a particular offence will not be eligible to be an officer of an organisation or to stand for election to office. For the first time we are going to see those elements that members of registered organisations have been asking for actually enacted in legislation.

We know very well, contrary to the comments of some, that many of these registered organisations control assets worth millions of dollars. They are effectively dealing with cash flow and investments similar to those of large businesses. And we, quite rightly, expect in this place and in this country that large businesses are held to a very high standard of account and that those people responsible for the handling of funds and making decisions associated with the fate of members' funds are adequately trained, are adequately competent and are required to report in a full and transparent fashion, and that is what this legislation aims to do.

It is entirely appropriate to expect a high standard of financial reporting from our registered organisations, given the trust that members place in their unions and employer associations that they will operate honestly and use the funds derived from membership fees to represent their interests rather than the sorts of interests that we have seen played out in the cases of Messrs Thomson and Williamson, and Ms Jackson.

Registered organisations must have substantial economic, legal and political influence. It is clearly inconsistent with community expectations for organisations of this type or people who are officers of those organisations to operate to lower standards than those that apply to corporations or other comparable bodies.

The officers of registered organisations under this legislation will need to disclose remuneration paid to the top five officers in the head office or their branches. They will be required to report material personal interests to their members, disclosing personal interests of officers and their relatives, and declaring any payments made to persons or entities in which that officer has declared an interest.

This will prevent officials from improperly benefiting from their role in organisations—for example, by an officer procuring goods or services to a company in which they hold some interest without disclosing that interest in an appropriate and transparent process. And we have seen all too often it played out in the courts, somewhat belatedly in many instances, where there have been serious abuses by officials of registered organisations using their privileged position to benefit themselves and indeed those closely associated with them.

We have seen in the case of Messrs Thomson and Williamson that the existing regulations do not sufficiently protect members' interests and that there will always be less than scrupulous individuals who will seek to take advantage of the positions that they hold. And this, apart from anything else, is the compelling reason why this legislation must be passed. It is in the interests of everybody in this place, from whichever political colour or persuasion. There are of course criminal penalties to be introduced for more serious breaches, in addition to those I have outlined. I finish with the words of Justice North, who made comments last year:

The penalties are rather beneficially low … beneficial to wrong doers.

Senator LUDWIG (Queensland) (13:48): I rise to speak on the Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2]. I am heartened to hear that Senator Back has such a keen interest in unions and their affairs. I did mistake him for perhaps not being a supporter of unions, but I can see now that he is a firm supporter of the union movement!

What is before us is another example of the coalition's industrial relations agenda—

A government senator interjecting—

Senator LUDWIG: Yes—its agenda. It is an agenda that appears to the community to be unclear and confused, a legislative program that simply has no direction at all. This government is lurching from a piece of legislation to a new piece of legislation. In this instance it is bringing forward its failed bill for the third time. But one thing is clear about this government: this bill is an illustration of the inordinate amount of time that this government is spending talking about and targeting organisations that represent the interests of workers and their families. Why is it doing that? You might say that Senator Back has a keen interest in unions and that is why he is talking about it. I suspect it wants to talk about anything other than the current issues that face this country.

They want to ensure that they are talking about something they are familiar with and that is union bashing. That is what they enjoy and that is what they like. That is what they feel most confident about, because they do not want to deal with the hard reality of the economy and they do not want to deal with the hard reality of marriage equality. They do not want to deal with a whole range of issues that they could be getting on with, with good governance.

Officers of trade unions work hard every day. In difficult times they simply want to get on with the job of representing working people. However, they continue to be attacked by this government.

We are all aware that this is the third time the bill has come before the Senate. The question before the Senate today in relation to this bill is not whether employer bodies and trade unions should be held more accountable to their members and the community. I think that is a given. Everybody agrees on that.

Labor's position on this matter is clear. We are committed to ensuring financial accountability of unions and employer organisations. We support appropriate and fair regulation for registered organisations. We support tough laws and tough regulations for those who break them. That is why in 2012 the Labor government, and indeed the now Leader of the Opposition, then Minister for Employment and Workplace Relations, toughened the laws to improve financial transparency and disclosure by registered organisations to their members. As a result of that, trade unions in Australia have never been stronger, more accountable and, in terms of their accountability, have never been higher. And the power of the Fair Work Commission to investigate and prosecute for breaches has also never been more apt.

In this instance we have tripled the penalties, which means that those laws have never been tougher; however, in this bill the government have gone well beyond the pale. They have gone too far, with no proportionality.

It is a disproportionate response against the trade union movements but it is not surprising that they would do that. Unsurprisingly they have departed from even the Prime Minister's commitment to shift the industrial relations debate towards the sensible centre. This is not sensible centre. This is the extreme ideologues within the Liberal Party and the National Party that want to attack the trade union base. That is what this is all about. Let us not be confused by Senator Back's newfound love of trade unions.

But let us also remember that this is a government that has gone to great lengths to proclaim and pretend that it is reducing red tape and regulation. The government had an omnibus bill about reducing red tape and regulation. We will not find this bill in that report; however, this bill does the complete opposite. It increases red tape and duplication by establishing a new regulator. If one was not already enough, this government wants to add a new regulator while retaining the existing one. The bill establishes the Registered Organisations Commission, which has coercive powers that are defined as 'do all things necessary or convenient for its purpose'. If there was ever one reason why Labor and even those opposite should not support this bill, it is that one phrase. What this government is attempting to do is give an unfettered power to a regulator to travel across unions, employers and employees. So if they think that this is not a double-edged sword, you might want to think again about how this bill will operate should it pass.

For any member of the community, this would be a considerable expansion, far too expansive for any regulatory body to have. In comparison to the powers given to the Registered Organisations Commission, they are far greater than those for regulated companies. The government makes much in the debate about moving trade union accountability and transparency to an equivalent of corporations similar to powers that are provided under ASIC. In this instance, this bill goes way further. If this government was serious about that, why would it not give the same powers to ASIC? Why would it not give the same powers to ensure that those financial charlatans out there are also held to book as well? But, no, it is simply picking on trade unions and ought to be pinged for it, when you look at the way the coercive power will extend to any person who the commission believes on reasonable grounds has information or a document relevant to an investigation. It is a wide power.

Furthermore, the commissioner can require a person to provide reasonable assistance in connection with an investigation. These provisions pose serious questions about the accountability and transparency of proposed unconstrained investigations which may require any member of the union to answer questions. This is an excessive power, far in excess of what you would expect if you were legitimately trying to improve accountability and transparency on top of Labor's 2012 legislation.

Yes, everybody stands against fraud, everybody stands against maladministration but what the government has not been able to do is tie this legislation to how it will actually remedy the circumstances that it describes so well. I think those opposite take a little delight out of describing it, but this bill does not fix those problems and they have not linked those two arguments together. The Registered Organisations Commission, which this bill establishes, is completely in excess of what companies are subject to under the Corporations Act. If this government was fair dinkum, it would pass these simple laws for companies and let us see what the companies might say about that.

The most revealing proposal of what the government is trying to do with this bill is its effect on volunteers. The compliance obligation of this bill applies to every branch of every union, to every part of every registered organisation irrespective of its size. So the Australian Council of Trade Unions has stated it is like saying that the rules which apply to the board of Woolworths also apply to the management committee in each individual store. Let us reflect on that from the ACTU perspective. A good example is the Australian Industry Group, which is an employer body and a not-for-profit organisation. It has 78 democratically elected councillors that comprise its governing and review body. They are unpaid and working in their own time. But under this bill, they would be subject to the new compliance requirements which require disclosure of interests and of those of their relatives. This exceeds the requirement placed upon directors under the Corporations Act, who are only required to disclose their fellow directors.

In contrast to the Australian Industry Group Council, we have the Woolworths board of directors, with 12 people appointed by shareholders being paid in excess of $200,000 per director per year, supervising, monitoring and governing the financial interests of shareholders in excess of $6 billion. We can obviously see that there is a significant proportionality problem with this bill. As this bill chooses to regulate individuals who choose, often on a voluntary basis, to dedicate their time to an employer body or union in the same ways executives and non-executive directors of corporations, there is a clear disproportionality that is expressed in this bill. But we should not be surprised about this. This is a government that likes to bash trade unions, likes to ensure that it is talking about trade unions more than it is talking about the economy. Its obligations on officers of trade unions and employer associations is very wide and creates an undue administrative burden on many registered organisations which are less than one per cent of the financial size—

Debate interrupted.

Senator RYAN (Victoria—Parliamentary Secretary to the Minister for Education and Training) (16:52): 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 RYAN (Victoria—Parliamentary Secretary to the Minister for Education and Training) (16:53): 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—

This Bill amends the Australian Radiation Protection and Nuclear Safety Act 1998 to ensure that Australia's regulation of radiation activities remains at the forefront of international best practice.

Since 1999, the Australian Radiation Protection and Nuclear Safety Agency (also known as ARPANSA) has been regulating Commonwealth entities undertaking activities involving radiation. This has included regulation of organisations such as CSIRO, ANSTO and the Department of Defence to undertake activities ranging from the operation of baggage x-ray machines at airports, to the operation of the OPAL research reactor at Lucas Heights.

Since the introduction of the legislation in 1998 there have been changes to international approaches to radiation and nuclear safety, as well as a number of reviews that have identified the desirability of minor changes to the regulatory scheme.

This has included reviews by the International Atomic Energy Agency and by the Australian National Audit Office. On the whole, the regulatory scheme was found to be appropriate, however changes were suggested to clarify the reach of the legislation, to strengthen the monitoring and enforcement powers of the regulator and to continue to ensure the legislation aligns with evolving international approaches.

Drawing on the recommendations of the various reviews and the experience of ARPANSA, this Bill makes changes to the legislation to provide greater clarity regarding the reach of the legislation, improve risk management of radiation activities undertaken by Commonwealth entities and provide greater capacity for ARPANSA to act in the event of an emergency or non-compliance with the legislation.

Specifically, the Bill makes amendments in four main areas.

Firstly, the amendments provide ARPANSA with greater powers to monitor compliance with the legislation and to take action in the event of non-compliance. For example, the amendments enable the CEO of ARPANSA to require a licence holder to produce information or documents, or to appear before the CEO to answer questions. Inspectors are also being empowered to issue improvement notices to require licence holders to address contraventions of the legislation, or likely contraventions, within certain timeframes.

These changes ensure that ARPANSA can access the information it needs to assess compliance with the legislation and can adopt a graduated and proportionate response to non-compliance, should it be identified.

The amendments also support the CEO of ARPANSA to better respond in the event of an emergency, by enabling the CEO to issue directions to licence holders to minimise any risks to people and the environment in unforeseen circumstances.

Importantly, all action taken by ARPANSA in response to non-compliance or to emergencies will continue to be reported quarterly and annually to the Parliament and will also be made publicly available.

Secondly, the amendments clarify the application of the legislation to contractors and those in arrangements with the Commonwealth or operating from facilities owned or controlled by Commonwealth entities. This provides greater regulatory certainty and ensures there is no gap in regulatory coverage between entities regulated by ARPANSA and those regulated by State and Territory authorities.

Thirdly, the proposed amendments improve the licensing regime and make it more efficient by:

enabling ARPANSA to issue time limited licences in circumstances where time limits may be more appropriate and ensures that unnecessary licenses do not exist into perpetuity– currently, no licenses expire;

providing for ARPANSA to regulate activities to maintain the integrity and safety of contaminated legacy sites as under current arrangements, ARPANSA does not have a clear legal basis to undertake this work; and

clarifying that ARPANSA may issue single licences for multiple activities to reduce regulatory burden and streamline arrangements.

Finally, the Bill makes a number of minor technical and administrative amendments, such as updates to definitions and removal of outdated provisions to improve the operation of the legislation.

The proposed changes have no financial implications, and do not place any additional regulatory requirements on regulated entitles. The amendments reflect sound administrative practice, and will ensure that Australia's regulation of radiation remains best practice.

Debate adjourned.

Senator O'SULLIVAN (Queensland—Nationals Whip in the Senate) (16:53): On behalf of the Chair of the Community Affairs Legislation Committee, Senator Seselja, I present the report of the committee on the provisions of the Australian Radiation Protection and Nuclear Safety Amendment Bill 2015, together with the Hansard record of proceedings and documents presented to the committee.

Ordered that the report be printed.

Senator LUDWIG (Queensland) (16:54): As I was saying before the debate on the Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2] was interrupted, the bill's obligations on officers of the trade unions and employer associations is too wide and creates an undue administrative burden on some registered organisations that are less than one per cent of the financial size of companies that have less stringent obligations under the Corporations Act. The most important problem, however, is that registered organisations are not companies. It seems to be a matter that seems to have escaped the attention of the government. The government has completely failed to recognise the difference between corporations and registered organisations. Unions are different to corporations, which are different to charities and clubs, and Australia rightly regulates each type of entity differently. Otherwise, the rationale of their debate would be, 'We will use the corporations power to regulate small incorporated bodies. 'We will use the corporations power to regulate charities, clubs and companies and they will all be put into the one mix.' It is not surprising that the government might want that but, ultimately, it is not a sensible or rational policy choice.

As we know, many different entities in this country are covered by different regulatory regimes that are more appropriately suited to what they do and how they do it. That is the sensible option and the sensible way forward. The Independent Panel on Best Practice for Union Governance, in its report to the ACTU, found that a number of researchers have questioned the merit of drawing upon a corporate model of accountability, pointing to the fact that trade unions are very different types of organisations and that, even within trade unions, there are different organisations, ranging from the very large to the very small. Their rationales for formation, the purposes they serve and the nature of their membership are some of the largest differences. You do not have in Woolworths or Coles or a multinational business, for example, a management body that is elected by the members. Shareholders are different. They have large financial exposure to a company by reason of the size of their shareholding; by contrast to union members who necessarily invest only their generally fairly modest membership fees.

But, in truth, this is not a debate about unions and how they should be regulated. This government is using this piece of legislation as a way to bash unions and to use accountability and transparency as the stalking horse, as a way to undermine unions.

Senator O'Sullivan interjecting—

Senator LUDWIG: I will take that interjection, because I know Senator O'Sullivan really does like unions. He would have been a member of a union for 20-odd years and probably used their services many times over the period that he was a member of the police union. I would not even be surprised if Senator O'Sullivan had been in an official capacity in that union. I am sure he would agree with me that this legislation is all about bashing unions, and nothing else. The government of course have many other things that they can talk about, but in this instance they do not want to talk about some of the important issues that face Australia. What they would rather do is try to distract everyone's attention away from some of the big issues and onto unions.

Amongst other things, the opposition sought to engage with the government to flesh out what they sought to achieve in relation to these reforms and whether the government would, in a bipartisan way, allow amendments, including amendments that would ensure penalties were not greater than those in the Corporations Act. As I understand it—and I am happy to be corrected—the shadow minister, Brendan O'Connor, engaged with the Minister for Employment about these very issues; however, the government remained implacable.

The government continue to peddle this line that they want the position that they have promulgated. They do not want to negotiate; they do not want to actually secure the passage of this legislation to improve accountability and transparency. Why? Because they want to use it as a Trojan Horse to bash trade unions with. They are simply using the bill, along with millions of taxpayers' dollars being spent on the royal commission, to attack those they perceive as their political enemies, as may play out in the royal commission today.

There have been fundamentally unfair pieces of legislation introduced into the parliament that seek to cut hard-earned working conditions for workers who want to achieve a fair day's pay for a fair day's work. There was a Productivity Commission review into the Fair Work legislation, which is the government's mandate to cut rights and conditions by using the Productivity Commission as another Trojan Horse. In fact, they have got a team of horses.

The dirty trick to cut government cleaners' pay is another example of where the government are undermining our strong industrial relations system, as is scrapping the low-income super contribution, hitting the retirement incomes of low-paid working Australians. And we have seen them delay the increase in the superannuation guarantee. The Prime Minister had promised that no worker would go backwards under him, but his freeze means workers on average wages would be $579 worse off over a four-year agreement.

The government have also had a shocking public sector bargaining framework which is designed, I think, to have no outcome for workers in the public sector. And let's not forget the 180-degree turnaround on paid parental leave. I would like to hear their explanation of that U-turn. We have also heard from 10 coalition backbenchers, and members of the frontbench, coming out and calling for the abolition or cutting of penalty rates. This is the policy pursuit of those opposite. We have also got the Royal Commission into Trade Union Governance and Corruption where, just last week, The Sydney Morning Herald revealed that the commissioner, His Honour Dyson Heydon, had accepted an invitation to attend a New South Wales Liberal Party fundraiser and, as I understand it, that is playing out as we speak. The coalition are confused, but they really do have a shocking record on industrial relations. And it is not surprising to anyone that when they said WorkChoices was dead, buried and cremated, they had their fingers crossed behind their backs.

Before the last election the now Prime Minister tried to convince the Australian people that, if elected, he would not make any substantial changes to the workplace relations landscape. He promised he would not touch workers' conditions; he promised he would not cut wages or penalties. How things change in such a very short period of time! More than half-way through the term we have now got a raft of policy changes that this government wants to implement to hurt working families. Labor does not support this bill.

Senator LINES (Western Australia) (17:03): We have seen this bill, the Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2], many times before, and what that tells us is that the Abbott government are in trouble, because we know that when they are in trouble they turn on trade unions. They turn on working Australians. They had a shocker of a week last week. Firstly, they had a six-hour caucus meeting on marriage equality and came out with exactly the same position as they went in with—except that now they have got a few more disgruntled backbenchers and, indeed, frontbenchers.

Then at the end of the week we found that the New South Wales branch of the Liberal Party had invited the commissioner from the Royal Commission into Trade Union Governance and Corruption to a Liberal Party fundraiser. No matter which way they dress it up, that is what it is. It is a Liberal Party fundraiser and the commissioner of the royal commission into unions—which is nothing more and nothing less than a witch-hunt—has been invited to give the keynote address. Again, it demonstrates how out of touch the Abbott government are.

They seem to think that if they keep saying that it is not a Liberal fundraiser, that someone, somewhere in the Australian community might believe them. But everybody has seen the invitation; everyone is able to read for themselves that it is clearly a Liberal Party fundraiser. The other question that came out today in question time is that, given the Attorney-General obviously received an invitation, did he pay his $80? Perhaps we will get to the truth of that.

The other clear issue with the Abbott government is that there are actions and there are words. Despite their words, it is their actions that really count. We heard the Prime Minister say that WorkChoices was dead, buried and cremated, yet bill after bill in this place resurrects WorkChoices in one way or another. As Senator Ludwig just pointed out, there have been a whole raft of issues—an attack on penalty rates, superannuation, cleaners' pay and the clothing trade industry to try to reform that industry. On and on it goes. There have been attacks on low-income super. The public sector has been bargaining in good faith, yet the Abbott government refuse to move unless public servants choose to take a significant reduction in their conditions, then they might get a few more cents in their pocket. But nobody is fooled by this—it is only the Abbott government that remain fooled by their own rhetoric. They need to have a good, hard look at themselves.

We know that the leadership rumblings have started again. We were promised after the last leadership vote that good government would start from then on, but we are yet to see it. The debacle on marriage equality, the debacle on their hand-picked royal commissioner—on and on the scandal, dysfunction and chaos continue. This registered organisations bill is just one of many attacks on workers—on those who put their hand up for voluntary positions within trade unions and, indeed, within employer organisations. They are under attack again. I think this is, at least, the third time this bill has come before the Senate, with barely a change to the intent of the bill. Let's look at the background.

I heard today those opposite going on and on about the Health Services Union and it was a disgrace—there is no getting away from that—but Labor in government acted. We changed the way that registered organisations had to operate and those changes are still working their way through the system. Of course, the Abbott government would pretend that nothing changed, when in fact significant changes were made to that bill, which were opposed by the ACTU and by employer organisations. Nevertheless, Labor went ahead, when in government, and put those changes in place. As I said, many of those changes are still working their way through the system.

We had a couple of public inquiries into this bill. It did not matter whether it was the Senate legislation committee where the government has the numbers or the references committee where the government does not have the numbers, the conclusions were the same. Nobody believed that this legislation was necessary—no-one. In all of the submissions, whether they were from employer organisations or from employee organisations, no-one thought this was necessary. Indeed, I heard today in this place a government senator saying that most unions go over and above what is required under the registered organisation proposals before us today. That is true; we heard that in evidence.

The MUA goes out with its financial statements and has meetings of its members right across the country. It explains to members exactly what is and what is not in the financial statements of that union, but it still does not stop them from saying that somehow some other group needs to be legislated for. Even when we have the premier registered organisation employer organisations across the country saying that this legislation is completely unnecessary, the Abbott government nevertheless continues on and why? Because it gives them the opportunity to beat up on unions. I am not really a betting person but I bet you any money you like that, as we lead towards the Canning by-election, guess what will happen? There will be union bashing, there will be questions, dorothy dixers to ministers about trade unions. There will be speeches in here about the evils of trade unions because the government thinks that beating up on trade unions and on workers somehow increases their popularity.

You only have to look at the opinion polls to see that the Abbott government is deeply unpopular. In fact, on the sorts of issues that people would normally look to their government for support, they have lost the trust of Australian voters. Despite Canning being a relatively safe seat for the Liberals, the Canning bi-election will be a good test. We will see a swing against the government. I would love to unseat the government in that seat, but watch this space. We will see a full-on attack on trade unions over the next few weeks.

Today in this place, just as he did when he first spoke on registered organisations, Senator Back at least did not go as far as he did last time because in the interim I corrected him. He gave us a story of a member of the Health Services Union in Western Australia, a carer who was a member of her trade union. Senator Back thought that trade union was the Health Services Union and he went on about how the money was spent. But of course in a subsequent speech I pointed out to Senator Back that the union in Western Australia is United Voice; it is not the Health Services Union. Today, Senator Back told the same story again about the Eastern European member, implying that she had wasted her union contributions on this dud union, but this time he did not situate the example in Perth and he did not mention the Health Services Union. So he has learnt something.

We are seeing again this kind of rhetoric. It does not matter if it is not true, it does not matter if it is the wrong union; obviously all unions are the same. They all look the same. If you are a carer in Victoria and a member of the Health Services Union, without checking his facts he suddenly thinks it is the same union in Western Australia, which of course it is not. For a senator who prides himself on Western Australia, we often hear the Western Australian stories. He seems to know so much. He certainly could not get it right on which union carers who work in nursing homes in Western Australia belong to. It is United Voice. That story, discredited the first time, then I corrected the record, is still used a second time to somehow paint unions and low-income workers in a bad light. That story is completely wrong—and I listened very carefully today.

Between now and the last time this bill was presented, we now have the disgraceful Commissioner Heydon affair. If anybody needs checking, it is those opposite in whom they appoint, how they get there and how royal commissions are being used as nothing but witch hunts. To allow the commissioner to continue in that role is an absolute disgrace and nobody could take seriously either the interim report of the royal commission or any future reports when it is presided over by a royal commissioner who thought it was okay to attend a Liberal fundraiser.

The Fair Work (Registered Organisations) Amendment Bill is exactly the same as a bill presented a few months ago. The explanatory memorandum to the current bill does not materially differ from the explanatory memorandum of the previous bill and it does not contain any additional information provided by the minister in relation to the matters raised by the Labor senators of the committee—again, the arrogance of those opposite. Even though in our report to the Labor senators raised particular concerns, did the minister or the government bother to take the couple of months between the presentation of the bill and today to try to address those concerns? No—of course they did not. In their usual arrogance they rolled up here and again tried to say to the Senate, 'Yep—same bill. We just want you to vote a different way this time.'

What do they think? What has changed? I have not heard employer organisations out there saying, 'Oh, we've got to have this bill. We've got to have this legislation in place. We've got to be held even more accountable. We have to be compared to a corporation when we're not.' There are fundamental differences there. Again, this demonstrates that the Abbott government certainly do not understand trade unions. But even more so they do not understand registered organisations.

In the main, most of the office-bearers in trade unions and in registered organisations are volunteers. In the case of my union, United Voice, very few of the elected positions are paid positions. Most of them—the branch councillors, the treasurers, the presidents, the deputy presidents and so on—are all volunteers who give up their time, away from their families, and who sometimes take time off work to attend union meetings to be part of the running of the trade union. And that applies to all trade unions. Very few of the positions within trade unions are paid. And it is the same with registered organisations, as we heard in evidence. In fact we heard that it was perhaps much more difficult for them when they are running a regional group.

You would think that the National Party would try to look after them, but we know that the National Party have well and truly deserted the bush with all of the things that they have agreed to in this place. It certainly shows that if they ever were a party of the bush that they have well and truly left that behind. You might have the secretary, the president and the committee of an employer organisation all as voluntary positions. And yet, without blinking, the Abbott government just wants to apply extremely onerous reporting obligations to organisations. Further to that, it wants to fine them if they get it wrong.

I would suspect, as the employer organisations told us in evidence, that in future—if this registered organisations legislation gets through—they will have trouble filling those positions. Employer organisations, along with unions, fill a really important role in our community. They can moderate the behaviour of some employers who go beyond the pale, because usually they can be impartial and have the facts and figures at their disposal. But, no—the Abbott government just want to tear that to shreds.

Again, we have seen this blatant disregard by the Abbott government for those who volunteer in our community. We have seen that whether it is in the environment, with our environment groups which have just been run over by the Green Army, or with this legislation, where we just want to bowl over all volunteers in our community and put such onerous obligations onto them that they will simply not put their hands up. They will be too scared to.

Perhaps that is part of the Abbott government's agenda—to scare these volunteers so that they do not put their hands up for trade union work or to be volunteers for employer organisations. That is where this legislation is heading. It is treating employer organisations and unions as corporations which, of course, they are not. They are not making profits and they are not returning a dividend to shareholders. That is not what either of those groups do, and yet that is how the Abbott government want to treat these groups, which do a really valuable job in the community.

The Scrutiny of Bills Committee raised issues to do with this bill too. In its fifth report of 2015 it drew attention to a number of issues that it believed were insufficiently dealt with in the explanatory memorandum. In particular, the Scrutiny Bills Committee noted its disappointment with the minister's failure to address these issues for a third time. We have to ask ourselves: are the government genuine when they say they want to listen and to respond? If a bill does not get up the first time you might think, 'Well, okay, we'll have another go.' But when it does not get up the second time and it is presented a third time, and the government have made no changes at all and do not even respond to issues raised either by the Labor senators' report or the Scrutiny of Bills Committee report then, seriously, you have to question the motives of the Abbott government in pursuing legislation like this. You would really have to question what their motives are.

And their motives are that they want to continue to bash unions. The government want to be able to stand up and say, 'Despite Labor moving legislation which already covers off on employer organisations and unions which requires officers to be trained and for there to be a lot more reporting and transparency, this goes way too far.' Again, they say, 'We think you're all guilty and that is why we need this legislation—to hold you all to account.' We have legislation in place at the moment which is perfectly adequate.

Did the Abbott government do any kind of review of that legislation? No, of course they did not. Again, their arrogance got in the way and they thought, 'No, let's just put this on our list of how to demonise trade unions.' And it is not working for them. It is not working for them. They only have to look at the polls, the disunity and the chaos in their own party to see that these types of bills are not working for them. Again, Labor will not support this bill because the government simply have not listened. They have not listened to one single word we have said in opposition to this bill.

We put the first lot of legislation in place. You might think that it stands to reason that perhaps they might be prepared to have a look and to say, 'Oh yes, we missed that. Yes, that is a good reform.' But, of course, no, they have not done that. They have not taken on one single suggestion made by Labor and they have certainly ignored the Scrutiny of Bills Committee. Why is this government continuing along this way? Because their actions speak louder than their words. We know that Work Choices is far from dead and buried. This is all Work Choices under another name. It is Work Choices by stealth—by putting this bill up, by putting up the ABCC, by putting up the low-income super, by knocking off cleaners' pay, by refusing to bargain in good faith in the public sector—on and on it goes. They are not giving one skerrick of compassion to the Hutchison Ports workers who perhaps are still facing the sack come 31 August.

This government has clearly shown it does not care one bit about workers; it certainly does not support trade unions; and it does not even support employer organisations. Labor will continue to speak out against bills like this, and we will continue to oppose them in this place. Thank you.

Senator McKENZIE (Victoria) (17:23): Thanks for the talking points, Senator Lines. It is always a pleasure. Senator Lines is Deputy Chair of the Senate Education and Employment Legislation Committee, so we have spent a lot of time examining this particular piece of legislation and consulting broadly with union organisations, the broader community and obviously the trade union movement. And pretty much everyone falls in along party lines, as it were. But we did do, Senator Lines, was take this policy to an election and we won that election. You ask why we bring in legislation that the Australian people actually voted for at the last federal election, why we bring it in to the Senate, why we bring it in to the House of Representatives. That is why: because they voted for it.

So I again rise to add my voice to the calls for greater accountability and transparency, not only in the trade union movement but across registered organisations. I am not of the belief that, simply because you are a volunteer in a registered organisation, the people you represent and the people whose money you administer should not be entitled to a level of governance that gives them faith and confidence that the board looking after their interests and indeed millions of their dollars is doing so with their best interests at heart. I think those hardworking Australians who are members of trade unions have a lot to be concerned about in terms of how the leadership of various unions—not all unions, but a great number—have actually used their money and their influence over time.

From Labor Party senators' discussions and debates around this bill before the Senate today, one would think the royal commission into the trade union movement was a waste of taxpayers' money. I will tell you what is a waste of people's money: when you look at the revelations coming out of the royal commission and the millions of dollars of hardworking low- to middle-income earners across this country that the leaderships amongst the trade union movement have wasted. It just beggars belief! We come here and we have these same debates along party lines.

I am not somebody who thinks that trade unions do not have a legitimate role in a civil society. Absolutely not. I was a president of a student union. I think the trade union movement has done great things for the Australian worker over a long period of time. But enough is enough. We need to restore faith in the trade union movement for the honest Australian worker.

It is very sad to stand here today—and the senators who are elected by those very hardworking Australian union members, whose dollars go to fund their preselection campaigns, whose money and votes and influence is used by the likes of Cesar Melhem in my home state of Victoria. You are shaking your head, Senator Polley—through you, Chair.

Senator Polley interjecting—

Senator McKENZIE: Do you want to come down to Victoria? Do you want to come and have a look at the Andrews government? Do you want to talk about Mr Pakula? Do you want to talk about Cesar Melhem? Do you want to talk about how hardworking Victorians' money and votes are being used and abused by the Victorian Labor Party? I am happy to have that conversation. I will take you to them. We will have the meeting.

Senator Polley interjecting—

Senator Bilyk interjecting—

Senator McKENZIE: Because I have, in the interests of regional Australians' jobs—

The ACTING DEPUTY PRESIDENT ( Senator Gallacher ): Order! Senator McKenzie, please address your remarks through the chair.

Senator McKENZIE: Always, Mr Acting Deputy President. Through you, Mr Acting Deputy President: I have worked with a variety of unions, because I am concerned about job opportunities in regional Australia.

You have some really great unions that are out there actually working with the local employer to find some sustainable outcomes, where it is a win-win situation, where the business gets to stay open. These employers are not bottomless pits; they are actually employing people. So the best outcomes are when the union works with the employer to actually ensure that the productivity gains on the shop floor are achieved.

Senator O'Sullivan: More jobs.

Senator McKENZIE: Thank you, Senator O'Sullivan: more jobs, more money, a greater community, greater stability. That is the best outcome. Sorry, I know I have completely gone off my speech. It really concerns me when those opposite do not actually stand up for bringing confidence back into the Australian public and their view of the trade union movement.

When we look at the trade union movement, it is not just the classic stories that we all know too well; it is also things that have been brought out through the royal commission; the Comancheros being used as debt collectors. Again, in my home state of Victoria—you are shaking your head, Senator Polley.

Senator Polley interjecting—

Senator Bilyk interjecting—

Senator McKENZIE: Through you, Mr Acting Deputy President: in Victoria, we have evidence from the Assistant Commissioner of Victoria Police, Mr Fontana—and if you want any more details about what the ALP thinks of Assistant Commissioner Fontana, then please see the Hansard of the hearing of the Senate Education and Employment Legislation Committee estimates. Do a search for 'Doug Cameron', and I think you will find some interesting reading.

In the assistant commissioner's evidence to the royal commission, he indicated that outlaw motorcycle gangs, including Comancheros, have been regularly engaged as debt collectors on behalf of the industry. Down where my children grew up, down in South Gippsland, we also have evidence of bikie gangs and organised crime being involved in illicit drugs distribution through the Wonthaggi desalination plant construction. To quote Assistant Commissioner Fontana:

Victoria Police is concerned that the methods for debt collection in the industry involve criminal conduct such as assault, threat to assault and intimidation.

We have got evidence that the Leader of the Opposition accepted donations from construction companies in his election campaign. Bill Shorten actually cut workers conditions as part of the 2006 Cleanevent agreement.

We have heard so much from those opposite around cleaning contractors. Why don't you get your own house in order instead of coming in here and making these affected claims, rather than actually dealing with the issue at hand?

I have already mentioned Cesar Melhem—and I could go on and on about dear Cesar Melhem, but I will not. Just read the papers and search it. We have the Boral issue on construction sites, again in my home state, in Melbourne. The law is determined by the CFMEU. We have evidence before the Senate estimates committee itself around the treatment of female inspectors by CFMEU officials that is nothing short of an abhorrent. And I thank those senators opposite who have actually said 'enough is enough,' because it is. And you need to have a little more conviction around standing up for those in the union movement who are doing the right thing by their members and have more courage about standing up against those in the union movement who are not doing the right thing for those hardworking members, because it trashes the whole brand.

Senator Bilyk interjecting—

Senator McKENZIE: Marketing 101, Senator Bilyk, through you, Mr Deputy President. You are trashing the whole brand, and it is very disappointing, because, as I have said, I have worked with a variety of unions in positive ways to secure jobs for regional Victorians and other Australians by actually working together. But we will move on to the bill itself, because it is actually quite fascinating and quite interesting.

We hear concerns that we have not consulted and, when we produced the first report back in December 2013, the Senate Education and Employment Legislation Committee made a variety of recommendations as a result of the evidence. As a result of that, the government has decided to amend the bill.

I do not know what greater example there is of responsiveness to evidence than actually recognising when a good idea comes along. When a good idea comes along we will amend the legislation, and that is precisely what we did. In December 2013—

Senator O'Sullivan: That was a fine amendment.

Senator McKENZIE: There were four, and they went to issues exactly as Senator Lines was talking about. If you have somebody heading up a registered organisation who has significant knowledge of financial obligations then there is no reason that we should actually be running that person through a financial training package as a matter of course, just to get the tick in the box. Some people like a tick in the box for no reason, but I do not see why we should actually be wasting the time and money of the person who is very busily volunteering in a trade union or indeed a registered organisation. Many employer groups are themselves run by volunteers, not just by employees. So that was going to be overregulation and an overkill for some people.

We also recommended that the obligation placed on officers to disclose every payment be reduced, with certain exclusions including limiting disclosures to payments made above a certain threshold. So we streamlined a lot of the reporting requirements that were originally envisaged. And that is a good thing because it not only cuts down on the administrative workload for those volunteers but is also quite consistent with our approach as a government to minimise regulation and red tape for those in the community.

Senator Lines went to the fact that we have looked at this bill a lot, and no-one more than the education and employment committee. I would like to make some brief comments, as it is the opportune time now, on our report brought down this month. It is useful to note that we have actually incorporated the four amendments within the bill. The bill comprises two schedules and seeks to amend the Fair Work Act 2009 and the Fair Work (Registered Organisations) Act 2009 to improve the governance and oversight of registered organisations.

The government's legislative response was in response to the HSU scandal, and it was wonderful to hear Senator Lines put on the record her abhorrence for that particular issue and the impact it had not only on the members of that union but also on the confidence more broadly within the Australian community around the behaviour of union officials. I guess it was in that context that this particular legislative package came forward.

Schedule 1 establishes the Registered Organisations Commission, and it is to be headed by the Registered Organisations Commissioner, which I think would be entirely appropriate. The functions and powers of the commissioner are actually based on those of the General Manager of the Fair Work Commission, as well as those set out in the ASIC Act 2001.

The ALP's claim that if you are making a profit you should be treated differently to if you are not making a profit was really interesting. When it comes to governance, I am not sure the amount of money you are dealing with should be the deciding factor. I think anybody who is presiding over the interests of others, those officials and leaders, should be subject to the same guidelines whether they are volunteers or paid and whether their organisation is a not-for-profit or a profit organisation. And I do not know why the lowest paid workers in our community should not be able to have that sort of confidence in those who seek to represent them.

Schedule 2 is in two parts. Part 1 alters the reporting and disclosure obligations of registered organisations and their officers, increases civil penalties for noncompliance and introduces new criminal offences for the most serious contraventions. I think that is important. I think also what is important is there is no budgetary cost for the government and the arrears estimates and compliance cost for every registered organisation is about $1,270 per year on average. I think for us to secure the confidence of the wider community that trade unions in particular but also other registered organisations are being governed appropriately, that is a small price to pay.

I would also like to respond to claims that there was a lack of consultation. Given the amount of reports that have been generated out of my own committee and the serious consultation that was done by the minister's office in the formulation of this particular package, I am absolutely confident that trade unions were consulted, that the community was consulted and that employer groups were consulted. I refuse to accept from the ALP that the government is simply going about trashing the trade union movement, that there is somehow a sense within the government that when the polls are bad we will pull out our bashing-the-trade-union card. It is simply not the case.

This government—and I have said it many times in this place—is the best friend the Australian worker has ever had. We are serious about ensuring a stable and productive economy so that the Australian worker can be secure in their job. We are not just looking at the jobs of today but our competitiveness agenda ensures that we are looking at the jobs for tomorrow. It is transformative what we are going through at the moment. The technological advances, the types of strategies we are implementing through education policies are going to ensure that our workforce going forward is skilled for the 21st century, which is exactly what we need to be doing.

Labor's changes whilst they were in government were quite good. They went a little way but they did not go far enough. I think what we are doing is actually giving utter confidence to the sector more broadly, because we need to restore faith in unions and we need to restore faith in employer representative bodies. I am really sick of the idea that good legislation, legislation that wants to deal with the bullying behaviour—the unlawful behaviour of some of those in the trade union movement—is somehow trashing trade unions. It is not; it is actually about ensuring that people who go to work everyday are not going to be subject to attack. I think that is about a fair go for all people in the Australian community. To assume that it is just some Trojan horse for Work Choices, that this sort of legislation and our legislative agenda in this area are simply about being the Grim Reaper of Work Choices is simply false. Look at the evidence coming out of the royal commission or read the papers or be in my home state of Victoria and look at the behaviour of Cesar Melham, look at the behaviour of the CFMEU over a long period of time and the impact that has had on public infrastructure projects. It is not just wasting the taxpayer dollar, it is not just wasting the union members' dollar and misappropriating it but it is actually wasting—particularly Victorian—taxpayers' dollars as project after project experiences blowout. It is doing untold damage.

Another comment made by those opposite throughout the course of this debate is that somehow we roll out the Dorothy Dixers around trade unions whenever the polls are down. What a joke. We have been asking very good questions on this side of the chamber about the inappropriate behaviour of some union officials over a long period of time. I do not shy away from that at all. Throughout the course of a current Senate inquiry into temporary working visas in my own committee, the Senate Education and Employment Legislation Committee, we have had very strong representation from a variety of unions around issues with the 417 and 457 visa classes. Specifically, if you log on to the ACTU's website, you will see the Aussie jobs campaign—it must be preselection time for some people at the moment but it is still going swimmingly. The issue is, when you actually delve a little closer into the types of skill shortages that exist across the Australian economy, guess what? It turns out the union movement is experiencing a skill shortage as well. It is experiencing a skill shortage as we heard in question time today with a question answered by Senator Cash in a very powerful manner in response to evidence and questions on notice through the education and employment committee. Workplace relations advisers for 457 visas are in short supply, guess where? In trade unions.

Senator O'Sullivan: That is cruel.

Senator McKENZIE: I know, Senator O'Sullivan. It begs the question: if there are not workplace relations specialists in the trade union movement, where are they? I guess we just have to look opposite. We have got ex-workplace relations and union officials in the Senate Labor Party.

I want to thank those in the trade union movement that are doing the right thing by their membership, that are spending their money wisely and appropriately and that are showing appropriate leadership and restoring confidence. I call those who are not to actually leave the sector so we can restore confidence. All those senators in this place that are interested in ensuring honest government for the Australian worker, please support this bill.

Senator O'SULLIVAN (Queensland—Nationals Whip in the Senate) (17:43): I rise to make a contribution to this debate on the Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2] and I am very pleased to see Senator Lambie in the chamber because we know her position on these matters, as she understands the impact that some of this behaviour can have on productivity in places like her home state of Tasmania. I am almost prepared to declare my love for Tasmanians is right up there with my Queenslanders.

This legislation is about transparency. It is about accountability. It is about, in this case, some organisations including some trade union organisations being held to account. It is about the duty of care that they have to stakeholders, to beneficiaries of their efforts or victims where there are acts and/or omissions that arise out of the abuse of their power or the abuse of their position.

It includes the story in relation to criminal and unlawful behaviour. What are quite apparent are some shortcomings in the jurisdictional capacity of our nation to deal with this criminal and unlawful behaviour, particularly in those organisations that practise that, which includes—as has been well established in this place—a number of trade unions. Of course, it is about some of these organisations avoiding detection. The way they are doing that is that they are coming in here with their patrons. There are members of the Australian Labor Party and there are members of the Australian Greens who will make every effort in this place to resist this legislation and like legislation, to ensure that we never, ever restore the accountability that is required in such important sectors in our community. I have a fairly thick hide on me, I do not mind saying—but they do so, and there is a thickness of hide, I might say, that I have not seen too often.

First of all they fail to declare their conflict of interest. They fail to declare the hundreds and hundreds and millions of dollars that are pumped into their organisations to see that they are effectively returned to this place, to what is, by any standards, a very well paid, very well supported job. And they do that, it would seem—and we will talk about this a little bit later on—on the back of donations from companies that they have achieved in many instances at the cost of the people they are hoping to represent.

All we need to do as each of the senators makes their contribution—be it from ours or from the other side—is to keep in mind these key principles, these key touchstones. Ask yourself: does that support transparency? Ask yourself: does that support accountability? Ask yourself: will that hold the individuals to account so that their duty of care is taken, or does it leave us vulnerable to a continued abuse of their position and their power?

I want to reflect on the contribution made by Senator Ludwig. I know Senator Ludwig is up in his office now watching my contribution because I have got word that he does that as a matter of practice. What Senator Ludwig had to say—and it was a very, very interesting statement—was that the government is endeavouring to use transparency and accountability as a stalking horse on the unions. That is worth repeating: using transparency and accountability as a stalking horse on the trade unions. He went on to say that the royal commission was attacking unions, so the royal commission was the Trojan Horse. I know that my colleague Senator McKenzie has very eloquently set out some of the work and productivity work of the commission, and we will come back to that again in a moment.

I want to revisit—because some of the senators opposite were not here when I made a contribution on a separate bill the other day relating to these matters—where I was able to quote a union official who was calling on the Australian Federal Police to withdraw blackmail charges against one of their senior executive. Here is the old story. They say that for one man it is an empty Coke bottle; for the other it is a 5c piece. In this case we had the union official who described the behaviour of his colleague as 'normal negotiating methods'. That was his reflection on the circumstances, but to the Australian Federal Police it was the very, very serious crime of blackmail. I have some personal experience in this space. You cannot have corruption without some element of blackmail being involved. It is the way that people are blackmailed and threatened that if they do or do not do certain things there will be repercussions.

Let us just, if we might, revisit the royal commission. This is the 'stalking horse' that is using transparency and accountability as a stalking horse on the unions. Well, thank the Lord, might I say. Praise the Lord that that is what is happening, when you look at the litany of matters that have been exposed. Of course, these have nothing to do with the 600-plus breaches, offences, that have been prosecuted against a variety of unions and the over $6 million worth of penalties—which, I am instructed, are paid for by the unions, by those people who have secured the penalties against them. This is just a simple way to ensure that the behaviour permeates.

One of my favourites is the fact that Mr Shorten, the Leader of the Opposition and a union man through and through—it would seem, until you read some of the evidence that was given before this royal commission—accepted a $40,000 donation from a construction company. Now let us just stop there. Unibilt was the company. Let us just stop there. Mr Shorten, representing the interests of the membership of his union, accepted a $40,000 donation. That is a considerable sum of money by any standards and probably reflected something about the base wage of some of the individuals that he was representing in this particular circumstance. The interesting thing is that it comes from the construction company. These are the people against whom Mr Shorten is charged with representing the interests of his members. We all know what a union representative does with the employers, and that is to try and get the very best deal for those stakeholders who place their great trust in their union representative, just as stakeholders place trust in the boards of companies—and we are going to make a bit of a comparison later on, because there has been much said about how companies should be accountable but unions and registered organisations should not.

He got $40,000. What did he do with that? Let me think. Did he promote the interests of the union members? The answer is no—and, in case I forget to answer one of my own questions, we will just take a standard no for all of them. Did he put it to the welfare of the members? Did he put it into a fund? Was there any sort of benevolent application of that? That would be no, no and no. Did he distribute it? He has just achieved something off the employer, which is what he is charged to do. Did he distribute it to the members? No. Let us not continue with the mystery. What did he do with that? He paid the wages of people in his election campaign, the wages of his election campaign director. So, in an abuse of his position on behalf of the members that he was representing, he took off the enemy—if you listen to the Labor Party—off a corporation over which he was exercising—

Senator Polley interjecting—

Senator O'SULLIVAN: I know it is unpleasant—through you, Mr Deputy President. I do understand this is unpleasant and I am trying to keep my remarks as measured as I can, because I have been known to sort of embellish on occasions—but not today. Mr Shorten took the money and he paid the wages of his campaign director.

Senator Polley interjecting—

Senator Bilyk interjecting—

Senator O'SULLIVAN: If one of you are going to make a contribution—I say to you, through you, Mr Deputy President—it will be your chance to condemn these activities, something that you have never done. I have listened to hundreds of hours of contributions in this space, particularly about the CFMEU, and not once, not for one nanosecond, have I heard you make a contribution to condemn the behaviour—not just the unlawful, fraudulent behaviour but the behaviour as particularised by my colleague earlier in relation to threats, intimidation and evidence about outright assaults. Not once have I heard anybody make a contribution from the other side where they have used the word 'transparency'. Sorry; in the interests of being fair, I did hear Senator Ludwig use it. He talked about transparency and accountability, as a stalking horse, but, that contribution aside, I have not heard anyone on that side of the chamber use the words 'transparency' or 'accountability'. I have never heard any reference about being held to account or any reference to a duty of care—nothing. Most particularly, I have not heard you condemn the behaviour of this absolutely criminal organisation known as the CFMEU, about which this parliament, this Senate, has been endeavouring to bring measures into play so that we can regulate their behaviour, for the people who are affected by their behaviour—who are your constituency largely, members of that trade union. The day that I hear that, the little bit of hair I have got left will fall out.

So Mr Shorten accepted $40,000. Did he disclose that? Yes, he did disclose it, but it was only two days before he appeared before the royal commission—48 hours. Mind you, it had slipped his mind for eight years. But, two days out, 48 hours out, Mr Shorten finally—I use the words 'came clean'; you might use some other words. He heard the galloping hooves. He looked over his shoulder, and there was that stalking horse coming at him, with its teeth bared and its mane flowing in the wind, and what did he do? He ran straight into the Electoral Commission office to hide from the stalking horse and deliver up his declaration of this money. It was pathetic.

Senator Polley interjecting—

Senator Bilyk interjecting—

Senator O'SULLIVAN: I hear you. I do not know what you are saying because I am busy making my contribution but—this is how clever I am—I can talk this loud, not listen to you and know that you have not used the words 'transparency', 'accountability', 'held to account', 'duty of care', 'abuse of power', 'criminal or unlawful behaviour' or 'avoiding detection for eight years with only two days to go'. That was real skin-of-the-teeth sort of stuff, right?

Senator Bilyk: You're a good storyteller!

Senator O'SULLIVAN: I am a good storyteller, so sit quietly, kick your shoes off and lie back. I have got about six minutes to go.

What have we got here? We would like to see these organisations have a tighter regulatory environment, a well-resourced commission or, in this case, changes to the law that will allow us to be able to bring them to account, including the increasing of the penalties and the introduction of criminal offences very similar—listen up—to those for corporations, who have got a very similar role. Corporations have a responsibility, a duty of care, governance obligations and fiduciary duties to their shareholders. The shareholders' interest in the corporations is a financial one. Let us step over into the shoes of the union members. They have an organisation which is very similarly structured, in that people are elected into their positions, as with a board of directors.

Senator Polley interjecting—

Senator Bilyk interjecting—

Senator O'SULLIVAN: There are some notes on this if you guys are a bit distracted there with your conversation. I will have my office send you round some of my notes in case you have missed some of the contribution.

Senator Bilyk: Please don't bother.

Senator O'SULLIVAN: I am sorry?

Senator Ian Macdonald: That's very helpful.

Senator O'SULLIVAN: I am that sort of fellow, Senator Macdonald. You know that. I will bend over backwards to help my colleagues from across the way here. I will tell you why. I will tell you what motivates me. I have been in business—

Senator Polley interjecting—

Senator Bilyk interjecting—

Senator O'SULLIVAN: No, no. Here is lesson No. 2. We will move off the criminality. I can give you more on that if you want. Let us move over now as to why I have got an interest. I will tell you why I have got an interest. I have employed hundreds and hundreds and hundreds of those souls who pay their union dues into your organisations so that it can make it into your account and get you here into the Senate. Why would they support anyone into the Senate? I will tell you why.

Senator Polley: That's outrageous!

Senator O'SULLIVAN: No. It is a fact. It is on the public record. Why would they want you in here? It is because they have the honest but mistaken belief that you are going to contribute to decisions in this place—

Senator Polley interjecting—

Senator Bilyk interjecting—

The DEPUTY PRESIDENT: Order!

Senator O'SULLIVAN: I can hardly hear myself talk, Deputy President—that you will make contributions in this place to the productivity of this nation, that you will make decisions that will allow us to get productivity up. Do you know what comes with increased productivity? Jobs come with increased productivity. Do you know what happens when people have jobs? They get money—

Senator Polley interjecting—

The DEPUTY PRESIDENT: Senator Polley, I have been trying to call senators to order. I would ask you to cease interjecting. That goes to both sides. Interjections from both sides are disorderly. If we could hear the rest of Senator O'Sullivan's contribution in silence, that would be convenient for the conduct of the Senate.

Senator O'SULLIVAN: I am deeply appreciative, Deputy President. An increase in productivity means an increase in the fortunes of the company and its ability to employ more people and it ability—indeed, not just ability but a responsibility that they take very, very seriously—to pay more tax into the receipts of the nation. What do they do when all that is happening? They get a lot of confidence. Sometimes they borrow money and sometimes they will branch out and invest in new ventures. Again, what does that require? It requires more jobs. It requires more investment which generates more income, more profits, more jobs and more receipts to the nation. What happens when the nation gets blessed with good receipts? Well, Jiminy Cricket, I can only speak for our side of the parliament. The coalition invest it principally in infrastructure—that is what we do. Of course, we spend a couple of years trying to reduce debt; to get the trajectory of the economy back in order when we come to government. Eventually, we spend it on infrastructure, as we are at the moment. There is a $50 billion infrastructure program out there. That is more jobs, that is more wealth, that is more receipts, and on and on it goes—it is a cycle.

I will tell you what is the danger to the cycle. The danger to the cycle is corruption. The danger to the cycle is where you have organisations, little fish in a tiny pond, who can impact on the performance. If a job closes down for one day, it can cost $100,000. If a job shuts down for a week or 10 days, that may well reflect 100 per cent of the potential net benefit of that employer and then jobs are lost—they go to the wall. Senator Ludwig, you betcha we are going after transparency and accountability; you betcha. That is right at the fore of our mind and on the tip of our tongue. I really do not fear, and nor should the union movement or any other organisation, transparency and accountability.

My advice to them is very simple. If they hear the galloping horse coming up behind them—

Senator McKenzie interjecting—

Senator McKENZIE: That was a fine whinny, Senator McKenzie, if that was a whinny.

Senator O'SULLIVAN: that is our stalking horse. It is coming up to ensure that what they do is lawful, that what they do is directed in the interests of their members, that they are meeting their governance obligations and their fiduciary obligations, and that they are meeting their obligations to the national interest. They are in a position where they can affect the national interest if they affect the confidence that is in the construction authorities around this country. I urge colleagues, and I know it might be lost on some on the other side, to put the national interest, the interests of employees in this nation and the interests of the progress of this nation, before their own interests on this occasion and support this legislation before the Senate.

Senator IAN MACDONALD: I have been encouraged to enter this debate by the first speaker for the opposition, Senator Cameron, who gave an emotional address that was big on rhetoric, big on misrepresentation and big on self-interest as a former union heavy but lacking any sense, lacking any truth and lacking anything that would help to serve the best interests of the workers of Australia. It was a typical speech of a union hack at a union meeting. But it is not, unfortunately, what is required in this chamber, where we actually debate facts.

Most of the Labor members who have spoken in this debate today are themselves former trade union operatives, former trade union officials or sons, daughters, husbands or wives of trade union officials. As I said before, there is nothing wrong with that if the trade union movement was at all representative of workers in Australia. But only 17 per cent of all workers in Australia choose to join a union. Within the government sector, that figure gets up to 42 per cent. Living in this town for some of my life, I can well understand and appreciate that. More importantly, of workers in the private sector, only 12 per cent choose to join a union.

Who is in the private sector? Can I suggest that the industries that are run by private enterprise include the coalmining industry in Australia, and all of those workers in the Bowen and Galilee basins up where I come from who provide the wealth of our country. But of those people, only 12 per cent across the board choose to join the union. What else might be a private industry where only 12 per cent of employees choose to join a union? It is all the other mining industries—iron ore, zinc, copper refineries and the nickel refineries in the town where I have my base in Townsville

They are all private sector investment, private sector employers. On average across the board, only 12 per cent of their workers choose to join a union.

What else is in the private sector? The car making industry. Any manufacturing industry in Australia. Any transport industry in Australia—and there are people in this chamber who claim to represent the manufacturing workers and the transport workers. Of those people, because most of them are in the private sector, on average across the board only 12 per cent choose to join the unions.

Yet the people sitting opposite us, most of whom are only here because of the trade union movement and the influence they have on the Labor Party, represent less than 20 per cent of the total Australian workforce and less than 15 per cent of the workforce in the private sector. You do not have to think about this too deeply to work out that of this small group of Australians in the private sector—workers or representatives of workers in the private sector—only 12 per cent of them join a union. But the unions have enormous influence in the Labor Party.

I have mentioned before that, of those in the Labor Party in this house, most of them are only here because of the union movement—that is, the union movement representing no more than 17 per cent of the total number of workers in Australia. Half of the current federal ALP MPs and senators have had a paid position in the trade union movement. This includes 23 of the 55 ALP lower house MPs and 17 of the 25 ALP senators. More than half of the ALP frontbench at the current time—22 out of 43—are former union officials.

Of the 26 current members of the ALP's national executive, which is the chief organisational body of the Australian Labor Party, 19 are current or former union officials. As I say, that is fine if the union movement was at all representative of the Australian worker, but it represents fewer than 17 per cent of all workers in Australia. That means that 83 per cent of all workers in Australia choose not to join a union. And yet the alternative government, who is here solely at the behest of that 17 per cent of Australian workers, claims to represent the working men and women of Australia. Clearly, that is a false assertion.

If you heard the speeches here today, you will understand why all the former union organisers are so totally opposed to any legislation that requires accountability and transparency. You do not need to go to the royal commission; this has been obvious for a long period of time. The former colleague of many of the members of the Labor Party, Mr Craig Thomson, proved to us without a royal commission just how corrupt certain elements of the trade union movement are.

I am not anti-trade unions—and in fact at one stage I worked very closely with an element of a big trade union movement. We fought together for three years against the Labor Party, I might say, to protect the jobs of Tasmanian timber workers. That was the forestry division of the construction mining forestry workers union, the CFMEU. But at that time, the forestry section, and I emphasise just the forestry section, worked very closely with me—and I was then a minister in the Howard government—to make sure that we protected the jobs of Tasmanian workers.

Those who were around in the 2004 election will remember that, I think, the seminal turning point in the 2004 election campaign was when those forestry workers organised by the F-part of the CFMEU, came together in Launceston and provided the backdrop for the then Prime Minister, Mr John Howard, as he addressed the workers of Australia. They were all there in their high-vis and helmets. Mr Howard addressed them and told them that he and the Liberal Party would be sticking up for workers.

As a result of that, the people of Australia, not only in Tasmania, voted for John Howard and his Liberal Party because they understood that it was the Liberal government that was interested in worker's rights, not the Labor Party. They had made the decision—and I know Senator Lambie will be interested in this—to abandon workers in the forestry industry and get on board with the latte left set in Sydney and Melbourne.

At that time, the F-section of the CFMEU worked in workers' interest. I have every respect for them and I have every respect for the then boss of the forestry section of the CFMEU, Mr Michael O'Connor. I class Mr O'Connor as one of my friends. I think he is a nice guy and an honest guy, but he is now the national head of the CFMEU. Clearly, he does not have control over the CFMEU as he did over the forestry division of the CFMEU. I know that Michael O'Connor would not be interested in organised crime, the Comancheros, the threats and the bullying of women particularly, and the abuse of members of the CFMEU in relation to those matters. I know Mr O'Connor would not be involved in Mr Shorten's close friend Cesar Melhem's false invoices issue.

So there are elements of the trade union movement that I respect and that I know, and I have in the past worked closely with them. I am sure that the old forestry section of the CFMEU would have no problem with this bill because all it requires is transparency and accountability—the sort of transparency and accountability that applies to corporations, as it should. This bill is all about providing for workers, whose money the unions manage, the sort of accountability and transparency that we are required to have in public office around Australia in the various state parliaments and in this parliament. We have that accountability and transparency. Corporations have that transparency and accountability. Why not trade unions? I know that decent trade union officials—who, as I say, I have worked with—would have no objection to that. They do not mind telling people what their salaries are, what conflicts of interest they may or may not have and what other entitlements they might get out of their work as a union official.

I cannot understand people like Senator Cameron who violently oppose any transparency. I say to Senator Cameron and Senator Ludwig and to anyone else who has spoken in this debate: what have you got to hide? I am not suggesting that you have anything to hide, but then why not have an open and transparent regime that exposes and leaves you beyond reproach, beyond question, for the 12 per cent of Australian workers who choose to join your union?

As I say, I have nothing against unions. I do have a problem when various Labor governments insist that public servants have to join unions or that they have to provide their details to unions so that unions can approach them to be members. That is probably why some 42 per cent of public sector employees are in the unions—because they are more or less compelled, when Labor governments are in power at state or federal level, to disclose their details so the union organisers can get around and embarrass or intimidate them into joining a union.

With regard to the private sector, perhaps there are some Labor people speaking after me in this debate—I do not think there are, but I wish there were some—who could explain to me how they claim to represent the working men and women of Australia when effectively they represent less than 12 per cent of those in the private sector. Of all miners in Australia, all manufacturing workers in Australia and most transport workers in Australia, less than 12 per cent of them choose to join the union. Yet you have all the union hacks over on the other side saying that they look after workers' interests; they know what the transport workers want; they know what United Voice wants. They know what these workers want, and yet the workers vote with their feet. Even United Voice—is United Voice the Public Service union?—or whatever the Public Service union is—

Senator Payne: It is the CPSU.

Senator IAN MACDONALD: The CPSU. Even of those, only 42 per cent choose to join a union. Every time a Labor politician gets up and says, 'I represent the working men and women of Australia,' I say to myself, 'You represent less than 12 per cent of them in the private sector and less than 17 per cent across Australia.'

It is the working men and women of Australia who time after time—and I mentioned the 2004 election—have returned Liberal governments because they do not trust the unions either. If they trusted them, if they thought they were doing anything for the working men and women of Australia, they would probably join them. They would probably become members of the union, but they do not because (a) they think the unions do nothing for them; (b) they think the union officials do everything for themselves, and we have had a lot of evidence about that; and (c) they do not believe that they are on the right track for the interests of working people in Australia. And those working people of Australia vote for Liberal governments, not for Labor governments. This is an important factor, which I repeat often and will repeat more often because I get sick and tired of Labor senators getting up and saying that they represent the working people of Australia when clearly they do not. Clearly they do not! Less than 12 per cent of private sector workers choose to join the union.

A lot of those workers do not join the union, because they look at people like Craig Thomson and say, 'We are not going to pay our money so that some union hack, some union official who was supported by the Labor Party into this parliament, can cheat us, can rob us and can use our money for his own personal gratification and gains.' That is why people do not join the unions. If this legislation were passed and unions were more accountable, perhaps some of that 88 per cent of workers in the private sector who choose not to join a union might say, 'Well, now that the union industry is open and accountable, we might join because we now know that they are honest because we have the transparency and the accountability mechanisms to see that they are looking after our interests and not after their own interests.'

I say to anyone else taking part in this debate: do not be misled by anything Labor Party politicians tell you on this debate, because they represent less than 12 per cent of private sector workers.

You might ask yourself why that is so. It is because those private sector workers know that the union officials, by and large—there are some exemptions, and I have mentioned one case—are in it more for their own interests rather than the interests of the workers they serve. That is why 88 per cent of workers in the private sector choose not to belong to a union. Listening to Labor Party people talk you would think that they represent every single working man and woman in Australia. Clearly they do not. And I can assure the Senate—because I know, and the election result proves it—that workers in the forestry industry in Tasmania voted for the Liberal Party when the Labor Party abandoned them and left them to rot on the unemployment rubbish heap.

This bill, when it is passed, will help the unions. It will allow workers to understand that the unions are accountable and transparent. I would have thought that any genuine union official would be out there supporting this bill, because it could mean that more Australian workers would have the confidence and the trust to join a union. This bill will give Australian workers confidence and trust in the union movement, and that is one of the reasons that it should be supported.

Senator LAMBIE (Tasmania) (18:24): I rise to once again contribute to a debate on the Fair Work (Registered Organisations) Amendment Bill 2014 [No.2]. Like many speakers I note that a form of this legislation was presented to and voted down by this parliament before. A Parliamentary Library brief on this new version of the legislation says:

The Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2] (the current Bill) is virtually identical to the Fair Work (Registered Organisations) Amendment Bill 2014 (the previous Bill) with the Government amendments which were agreed to in the House of Representatives. The previous Bill was negatived in the Senate on 2 March 2015.

…   …   …

That Bill in turn was similar to the Fair Work (Registered Organisations) Amendment Bill 2013 together with Government amendments which were tabled (the original Bill).

I also note that the Parliamentary Library brief says:

If the current Bill is passed by the House of Representatives and rejected by the Senate, it could constitute grounds for dissolution of both houses and a general election.

…   …   …

A Bill must fail twice in the Senate to become a 'trigger' for a possible double dissolution election. It may be re‑introduced at any time within a Parliamentary term, but there must be a minimum interval of three months between the first failure in the Senate and the passage of the Bill in the House of Representatives the second time.

The Abbott government have presented this bill to this Senate knowing that they have very little chance of it being passed. Indeed, they want it to fail because the presentation of this bill, as indicated by the library brief, is a trigger for a possible double dissolution election.

Given the polls, I doubt that they would go to a double dissolution election, especially when the Victorian president of the Liberal Party, Michael Kroger, conceded on Sky TV that my political network, the JLN, in a double dissolution would pick up two to three senators in Tasmania alone. Michael further conceded that in an ordinary election their polling indicated that it was likely that the JLN could win an extra Senate seat in Western Australia and Queensland—and I can say that he did not want to talk about Victoria at all. So it is clear that the presentation of this legislation is a political stunt, in the knowledge that it is a trigger for a possible dissolution election. While it would be political suicide for the current Prime Minister if the current Prime Minister went to the Governor-General and asked for an early election, that does not mean the opinion polls would not change very quickly if a person like Mr Turnbull, Ms Bishop or Mr Morrison led the Liberal Party in the nation.

If the Liberal Party really wanted this legislation to pass, they would have been willing to meaningfully negotiate with the Senate crossbenchers—but they just do not get it. They refused to sit down and deliver the reasonable requests that we put to the government on behalf of our constituents. The best example of the government's refusal to talk in a meaningful way with the Senate crossbenchers is this morning's defeat of their ABCC legislation. This is legislation I offered to support if the government agreed to a couple of reasonable requests contained in a letter I sent to the Prime Minister before the second reading or substantive vote was taken in this chamber. I will quote from my letter to the Prime Minister as it directly relates to the provisions in the Fair Work (Registered Organisations) Amendment Bill 2014 [No.2] which aimed to clean up corruption in the union movement. It is also affected by the royal commission examining union governance and corruption. I quote:

Dear Prime Minister,

Thank you for your letter of reply dated 12 August 2015 regarding the confidential volume of the interim report of the Royal Commission into Trade Union Governance and Corruption.

I seek leave to table the Prime Minister's letter to me.

The DEPUTY PRESIDENT: Is leave granted?

Senator Payne: Mr Deputy President, in the normal course of events a senator would make whatever they wished to table available to colleagues before seeking to table it, so that we are aware of whether it was meant to be a confidential document and we are aware of its nature. I am happy to have a brief look.

The DEPUTY PRESIDENT: I can only ask if leave is granted. I think what you are indicating to me is that you are not granting leave at this point in time.

Senator Payne: Correct.

The DEPUTY PRESIDENT: Leave is not granted, Senator Lambie. But the minister at the table has indicated that they may consider that if they have an opportunity to look at the document.

Senator LAMBIE: I will continue quoting from my letter that I sent to the Prime Minister. In that letter I said:

While I acknowledge your point that Commissioner Heydon AC QC recommended that this volume be kept confidential in order to protect the physical well-being of Royal Commission witnesses and their families, … I do not accept the assumption that Royal Commission witnesses and their family's well-being would be compromised should crossbench Senators be granted access to the volume under the normal secrecy provisions followed for access to other highly sensitive documents.

There are plenty of precedents and procedures in place—

The DEPUTY PRESIDENT: Order! It being 6.30 pm, time for this debate is now interrupted. The Senate will suspend until 7.30 pm and I think at that point in time I may ask the Acting Deputy President at the time to put the question again about leave for that document to be tabled and then you will be able to continue with your contribution, Senator Lambie.

Proceedings suspended from 18:30 to 19:30

The ACTING DEPUTY PRESIDENT ( Senator O'Neill ): I understand Senator Lambie was seeking leave to table a document prior to dinner.

Leave granted.

Senator LAMBIE (Tasmania) (19:30): I will continue quoting my letter to the Prime Minister:

There are plenty of precedents and procedures in place for safely managing highly sensitive information and protecting witnesses' well-being … while still allowing Senators access to vital information which allows them to properly scrutinise executive government's actions and carry out their free and fair performance as Members of the Upper House of the Australian Parliament.

I note that since I received your letter, strong evidence has emerged which indicates a probability that Royal Commissioner Heydon, in accepting a key speaking role at a Liberal Party fundraiser, unless he resigns first—that he will be found by a higher court to have exhibited a form of bias.

Please note that I have called for Commissioner Heydon to resign from his position, because based on the facts, it will be impossible for the great majority of Tasmanians not to have the impression that he is biased.

In light of this information and the fact that Royal Commissioner Heydon has shared his confidential volumes with all state Premiers and their staff, I invite you to reconsider your refusal to allow crossbench Senators to have access to the Commissioner's confidential report.

I'm sure you'll agree that crossbench Senators are just as trustworthy as State Premiers, with confidential information.

And that there is no logical reason for the Royal Commissioner or yourself to deny access to his confidential report—given that it's been shared with all of Australia's State Premiers and their staff.

Especially when all of the report's information is needed to make an informed decision on whether to re-establish the Australian Building and Construction Commission.

With regard to the re-establishment of the ABCC, my view has shifted after I've conducted interviews with key stakeholders and re-examined the public record which you refer to you in your letter.

I'm prepared to support your ABCC Legislation currently before the Parliament under these simple conditions:

1.   All crossbench senators and senior staff are given access to the Heydon confidential report after following the usual strict protocols of signing non-disclosure agreements and giving undertakings that no information will be electronically recorded or notes are taken.

2.   Your Government deregisters the CFMEU. As you point out in your letter "The Commissioner draws particular attention to the behaviour of the CFMEU concluding there is a culture of wilful defiance of the law which appears to lie at the core of the CFMEU."

I agree that strong measures must be taken to remedy as you describe "widespread unlawful conduct in the building industry".

And after research over the last few months, including meeting with CFMEU leadership, ordinary members and businesses who have been adversely affected by unlawful conduct in the building industry …

… I'm at a loss to understand why you haven't taken the obvious, targeted, logical step of deregistering the CFMEU already.

Your inaction stands in stark contrast to the actions of the Fraser and then Hawk governments which deregistered the CFMEU's predecessor—the BLF.

This is a matter I raised in the Senate last week during question time and your representative Senator Abetz still failed to explain your lack of action and your weak approach to tackling lawlessness in our construction industry.

I was pleased however that he found my proposal to deregister the CFMEU "interesting" and after informal talks with fellow crossbench Senators … I'm of the view that you would have a greater chance of passing Legislation which deregisters the CFMEU than legislation which re-establishes the Australian Building and Construction Commission.

Your legislation has been likened to using a sledge hammer to crack a walnut, rather than a more targeted and surgical approach that de-registration would certainly bring to our Building and Construction industry Nationwide.

I consider your offer to arrange a confidential briefing by a senior officer in your department on the Heydon confidential volume an insult and affront to the people of Tasmania.

I'm stunned that you think that by offering me a confidential interpretation of the Heydon secret report by one of your staff—which I will not be able to talk about in the Senate—that I'm then able to make a properly informed decision when it comes to your ABCC legislation.

I'm also stunned that you think your personal assurances and promise that the Heydon confidential volume "does not contain any reference to political corruption or any matter that would harm the reputation of the Liberal party"—actually influences my opinion and actions.

Unfortunately, because of your long history of broken promises and mistruths, for the best interests of Tasmanians, nothing that comes out of your mouth means anything to me.

What matters is your actions and they—in this case, unfortunately show that you and Commissioner Heydon are unreasonably determined to stop crossbench Senators from accessing all information contained in the Royal Commission's secret volume.

Your tricky and obstructionist behaviour is interfering with my and other Senators' free and fair performance as Members of Parliament.

Should this obstruction remain and this contempt of the parliamentary process continues—I will be forced to take all steps available to me under Standing Orders to hold you and Commissioner Heydon to account in the Senate.

In closing, I note that you closed by indicating your "government is committed to doing all that is necessary to reform the building and construction industry and to reinstate the rule of law in this sector."

That statement is clearly false. Your government's inaction on CFMEU deregistration and Senator Abetz's reply to my question on notice last Tuesday proved that fact.

He could not properly explain why your government, unlike previous Liberal and Labor governments, has not moved to deregister a union which you describe as "continuing distain for the law". It's time to stop talking tough and follow through with effective action.

Take that first step and arrange for Commissioner Heydon's confidential report to be viewed under appropriate security conditions by all crossbench senators.

I look forward to co-operating with you and cleaning up not only the building and construction industry—but the Financial and Banking sectors and Health system of frauds and criminals.

Yours faithfully

I have spoken about this to the Senate before but it is worth repeating again. Unlike members of the Liberal Party in the Senate, including Senator Abetz, I do not have an ingrained hatred for members of unions. I acknowledge that, on balance, the union movement in Australian has been an agent for positive change and has protected and strongly advocated for the rights of working Australia families. If we did not have unions and organised labour and their fights for better wages and conditions, Australia would be a poorer, less fair country. However, yes, I also acknowledge that the unions, just like the corporate world, have had their fair share of fraudsters, crooks and standover men who have ripped off their members and committed shocking crimes to satisfy their own greed and lust for power. Of course there is an ongoing need to monitor, investigate and enforce our laws wherever crime and corruption are found.

Within many organisations, whether they be government departments, political parties, corporations or unions, wherever there is a concentration of power and money, the risk for criminal or unethical behaviour increases because, as we all know, if you are human, power corrupts and absolute power corrupts absolutely. However, the problem I have is that, when the Liberals say they want to apply corporate standards of regulation to the unions, Australian corporate standards are not all that flash. You only have to look at the corruption in one of the Liberal Party's biggest election donors, the banks, to realise that Australian corporate standards are about as good as the standards and regulations governing the Australian union movement.

At this stage of the debate, without all the facts from the royal commission, what is before us is the destruction of basic civil rights by this Liberal government, while they suck up to their political donors and pat them on the back for corporate standards which they clearly lack. I believe that an equitable solution to corruption in the workplace and broader Australian society is the establishment of a permanent corruption watch dog whose star chamber power will apply to bankers and union members equally. Combine that body with reformed world's best whistle blower or public interest disclosure laws that protect, encourage and reward genuine whistle blowers to come forward, then corruption in the workplace, corruption in government departments, corruption in the board rooms and corruption in political parties would finally be properly addressed.

This legislation can easily be viewed as an ideological attack on Australian workers. It is part of a Liberal Party attempt to silence and weaken those who advocate on behalf of workers. Once this Abbott Liberal government silences workers, it becomes easy to exploit and steal money from them and not only to steal money from them but to sack them and, for base political reasons, to have them replaced by cheap, compliant foreign workers.

It came as a hell of a shock to me and to many average Tasmanians, but I now understand, after talking with Maritime Union members and Caltex officers, that both Labor and Liberal governments have made rules which allow our big oil and other associated companies to legally sack 36 Australian maritime crew and replace them with foreigners on their tankers.

This Liberal government has decided to kill off the jobs of 45 defence clothing manufacturing workers because the defence minister has decided not to place further orders with the Workwear Group, resulting in the company announcing that union members will lose their jobs in September. This government has a budget of $100 million a year, $50 million used to be spent on making uniforms in Australia, but now the Liberal Party is happy to have all our defence combat uniforms made overseas—because it means fewer Australian union members.

In closing, I offer this challenge and advice to all political parties who want to clean up union corruption: support my call to de-register the CFMEU, give a guarantee that their money will not be accepted in political donations until this mess is cleaned up. I oppose the legislation before the house because it is ideologically motivated, unfair, and irrational and undermines the basic civil liberties and rights of Australian workers, while ignoring tens of billions of dollars in fraud, tax evasion and crime in the banking, finance, medical and other industries where multinationals have great influence.

Senator SESELJA (Australian Capital Territory) (19:42): I will respond briefly to some of Senator Lambie's contribution before I move to other aspects of the Fair Work (Registered Organisations) Amendment Bill. It is good that Senator Lambie acknowledges that there is serious corruption on our construction sites and in other parts of union activity. Issues around deregulation are certainly worth rising. I am not sure of the legalities of that. I would have thought it would need the support of parliament, although I could be wrong; obviously, it is not simply within the remit of government to make a decision like that. Whether or not support from the parliament would be there is an open question.

In relation to this bill, to say that you acknowledge some of the corruption—and some of Senator Lambie's contribution suggests that—but then to vote against this bill is to try to have a bet both ways—saying that you are against corruption but you will not support any serious penalties that would help prevent it. Let us be clear: when it comes to issues in Australian building and construction, obviously deregistration of one union, which is Senator Lambie's preferred option, does not actually address the issues. In the past when unions have been deregistered, they have come up again in a different form and as a new entity. The rule of law should be that, regardless of whether it is the BLF, the CFMEU or any other entity representing construction workers, to the extent that they represent those workers well, they should be protected by the law. They actually have a special status under the law at the moment, and that would continue. But, of course, to the extent that they misuse that status and to the extent that they engage in the kinds of practices that we have seen outlined at the royal commission and well before that, they should have the rule of law applied to them.

You should not just be able to make it a financial decision, which is what, unfortunately, organisations like the CFMEU have made at times. They are prepared to wear the fines because they see more benefit in breaking the law, knowing what the maximum fine is. I think that to sit here and say that you are against those kinds of practices but then actually to vote against any sort of reasonable sanctions and penalties simply does not make sense.

What I wanted to do was just go through what the bill actually does and then, of course, talk about some of the practices to which we want to see serious penalties applied. It is why we believe it is important that we actually have proper sanctions. And just finally on Senator Lambie—she talked about corporate criminals being held to account. The reality is that the Fair Work (Registered Organisations) Amendment Bill is actually about saying that those in some of these organisations, like unions and employer groups, should have similar penalties, or the same penalties, to those that apply in the corporate sector. If you actually want to be fair dinkum in saying that it should be the same—whether it is wrongdoing in the corporate sector, in a union or in another registered organisation—then I agree with that. That is what this bill does. If you actually believe that, you may well support this legislation because that is exactly what it is a designed to achieve.

It says that this type of wrongdoing, in whatever form, should be dealt with similarly—with serious penalties. I do not care if you are corporate crook or a union crook. If you are doing the wrong thing—if you are deliberately breaking the law or if you are not complying with your duties at law—then you should have the same penalties, regardless of whether you are representing workers, shareholders or anyone else. That is what this legislation is about. So let's not pretend that this is about one versus the other. This is actually about applying a level playing field to wrongdoing. It is extraordinary to me that people can come into the Senate and argue that when the Craig Thomsons of the world do the wrong thing that they should be treated with a lesser penalty—

Senator Conroy: And the Kathy Jacksons—your friend!

Senator SESELJA: Well, Kathy Jackson. Do you want say it's Kathy Jackson or Craig Thomson? If you are found guilty—and I am not sure that Kathy Jackson has been found guilty of anything. Craig Thomson has.

Senator Conroy: She's declared bankruptcy to avoid the decision.

Senator SESELJA: We have the interjections from Senator Conroy, but this is for anyone who is found guilty of wrongdoing. I am not aware whether Kathy Jackson has been—I do not believe she has. But whether it is Michael Williamson or Craig Thomson or anyone else—whether it is a corporate crook who is found guilty of doing the wrong thing—

Senator Conroy: She's declared bankruptcy to avoid it.

Senator SESELJA: Sorry—we are actually talking about serious penalties here. What you are saying is that there should be a different sphere, where if you rip off the workers you should not pay the same sort of penalty as if you rip off the shareholders. I actually think that if you rip off the workers then surely it should be a penalty that is just as high. What the Labor Party is arguing today, and what the Greens and others are arguing, is that ripping off workers is worth a lesser penalty. That is what they are saying, because that is actually what this bill addresses. They are saying that workers being ripped off by their representatives should bring a lesser penalty, that it is not as bad as if you rip off the shareholders. How do you justify that? How do you justify that to your community?

Those who claim to represent the workers are saying, 'Well, look—it's fine. We know that those union officials were meant to represent the workers, but when they ripped them off it was not as bad as when that corporate crook ripped off the shareholders and the creditors.' In my opinion, that is actually putting the workers below those others. That is what the Labor Party is doing today. They are saying, 'Your rights don't matter. You've paid your union fees, you've expected fair representation and you've expected those union fees will be used for the purposes of representing you and not for feathering the nests of some of those who represent you.' And here we have a piece of legislation that would actually hold some of those people to account if they do the wrong thing—and we are talking about knowingly doing the wrong thing. We are talking about people who set out to rip off those who they represent. Well, I say that if you are a union crook or a corporate crook then you should be treated in the same way. You should have the law applied to you fairly. Those who vote against this legislation are, of course, denying that.

That is what this does. This bill would establish an independent watchdog with enhanced investigation and information-gathering powers to monitor and regulate registered organisations. Of course, we already have ASIC, which has those kinds of powers. It will strengthen the requirements for officers' disclosure of material personal interests in related voting and decision-making rights and charge grounds for disqualification and ineligibility for office. It will strengthen existing financial accounting, disclosure and transparency obligations under the Registered Organisations Act by putting certain rule obligations on the face of the RO Act and making them enforceable as civil remedy provisions. It will increase civil penalties and introduce criminal offences for serious breaches of officers' duties, as well as introduce new offences in relation to the conduct of investigations under the Registered Organisations Act.

Now, what part of that is objectionable? There has been very little in this debate that would provide a rational, coherent response to that question. What part of those provisions is objectionable? They claim some ideological divide. What they are doing is making an ideological divide, where they say that workers being represented should hold their representatives less to account—and that the law should hold those people less to account—than those who are representing shareholders. Because those who are representing shareholders already have these obligations.

Let's just remind the Senate of what the Labor Party's position is on this, backed by the Greens. Of course, the Greens increasingly draw their funding from unions. They often talk about donations and how that affects things. Well, of course, we know that the Greens are funded by the unions almost as much as the Labor Party are these days—they are indeed.

They are saying that, if they—their funders, the union representatives, the union bosses—do the wrong thing, if they fail to properly represent their members, if they fail to comply with the law, then they should just have a little penalty, they should just have a slap on the wrist. They are saying that, if they do the wrong thing, they should have the kind of penalty that we see applied to the CFMEU often, and which they ignore because they can pay the fine; they have the financial resources to pay the fine, time and time again, so they keep engaging in the conduct. You are holding the representatives of workers to a lesser standard than the representatives of shareholders.

So let's go to some of what is being defended here. Some of what is being defended here and some of what we have seen emerge at the royal commission needs to be exposed. It has been exposed in part, but we need to highlight the type of behaviour that we are talking about. Senator Lambie said she does not hate union members 'like some members of the Liberal Party do'—and that statement about Liberal Party members is simply not true. Some of us have even been members of unions, and when we have been members of unions we have expected they would do the right thing. And many do—in fact, most do. And those that do the right thing would have nothing to fear from legislation like this. If you go out there and you represent your members to the best of your ability, if you work hard to get them the best deal, then you would actually welcome legislation like this. And, if there is someone dodgy working in the next union, maybe someone you do not know about, then they should be held to a high standard when they do the wrong thing.

We have seen too many examples to say that we should not have a legal response—because that is what this is about. It is about saying: is there a reasonable legal response to this issue? We say there is, and we put this legislation forward to simply level the playing field. But let's look at some of the examples of what we have seen in the royal commission.

We have seen that CFMEU officials Brian Parker and Darren Greenfield consorted with underworld crime figure George Alex, whose friends and colleagues include Mick Gatto, former Comancheros, senior Rebels bikies, standover man Vasko Boskovski, recently murdered career criminal Joe Antoun, and famous ISIS jihadists Khaled Sharrouf and Mohamed Elomar. These are some of the connections we are seeing. We have seen Comancheros being used as debt collectors.

Assistant Commissioner of Victoria Police Steve Fontana confirmed that they have evidence showing the overall infiltration of the building and construction industry by organised crime. He indicated that 'outlaw motorcycle gangs, including the Comancheros, have been regularly engaged as debt collectors on behalf of the industry. He said:

Victoria Police is concerned that the methods for debt collecting in the industry involve criminal conduct such as assault, threat to assault and intimidation.

This is the kind of thing that is being defended by the Labor Party, the Greens and others in this place. This is the kind of thing they do not want to see reasonable penalties for. There is a range of pieces of legislation to deal with this—whether it is the Australian Building and Construction Commission, whether it is the Fair Work registered organisations legislation—that would actually apply some proper penalties so we can stop this at source, instead of having some of this wrongdoing become endemic in parts of the industry. This is what the Labor Party and the Greens are defending. We have heard it time and time again.

Senator Conroy interjected when I mentioned Craig Thomson's name—

Senator Conroy: Did I? No, I just want balance.

Senator SESELJA: You did interject. You said there were others. If there are others, Senator Conroy, let the law deal with them.

Senator Conroy: Unlike the royal commission, which wouldn't. It wouldn't even take submissions on it.

Senator SESELJA: Wouldn't you want to see the law deal with them as well? If you are aware of others that we are not aware of, then bring them forward. Expose them. But what you are saying is that the likes of Craig Thomson and Michael Williamson, who have clearly been shown to have done the wrong thing by their members.

The ACTING DEPUTY PRESIDENT ( Senator O'Neill ): Senator Seselja, it would help if you directed your comments through the chair.

Senator Conroy: It would help if you stopped talking to me.

Senator SESELJA: Absolutely, Acting Deputy President. I appreciate your advice and I will go through the chair.

Senator Conroy: I know we are family, but that is taking it too far. Family! You know what they are like. You marry into them and this is what they are like.

Senator SESELJA: It will help if I do not hear this chirping in my ear from Senator Conroy. It will be easier not to respond to him. Therefore, I will certainly take your advice, Acting Deputy President, and go through the chair.

But this is the kind of behaviour that the Labor Party is saying is okay. These interjections are saying: 'What about others?' Well, absolutely: what about others? If they are shown to be doing the wrong thing—I do not care who they are; I do not care if they claim to be a whistleblower or if they are a whistleblower or if they simply got caught out doing the wrong thing—there should not be just a slap on the wrist for this kind of behaviour.

I again go to the point that we rightly say—and Senator Lambie has raised it and I am sure others have raised it in debate—to corporate criminals: 'There are serious penalties.' People can lose their life savings. People invest in companies, expecting that the directors will do the right thing. We have a legal framework to make sure that you do your best. If you get it wrong, if you fall a little bit short, maybe there are some consequences. But, if you deliberately fall short, if you deliberately do the wrong thing, if you knowingly do the wrong thing, then that is when we really need to have the serious penalties, and say that that is absolutely unacceptable. We need to have confidence as a community in corporate leadership. We have those laws. At the moment they are much stronger than what applies to some of these registered organisations.

What we are saying is: let's level that playing field and let's make sure that we do have serious penalties. Whether you are ripping off the workers or ripping off the shareholders, it is the same principle. It is absolutely the same principle. We have seen this lawless attitude of some unions, whether it is with Boral and construction sites in Melbourne, with the law being effectively determined by the CFMEU. There are numerous examples of secondary boycotts, cartel behaviour, racketeering, intimidation and illegal black-banning. The CEO of Boral, Mike Kane, lashed the CFMEU as 'an organisation that openly admits it has and will continue to break the law'. He stated:

On construction sites in Melbourne the law doesn't apply, the law is determined by the CFMEU…

That simply cannot stand. We can look at all the economic costs of having a situation of lawlessness on our construction sites and in other industries but there is also the moral fabric; the rule of law actually has to mean something. We could go through all the evidence that we have heard so far about Cesar Melhem, Bill Shorten's close friend; the false invoices; the Industry 2020 slush fund; the CFMEU receiving leaked details from Cbus members; the threats and the intimidation—and here in the ACT we have heard damning evidence into some of this behaviour.

I would ask senators, as part of this debate and as they consider their vote on this issue, to simply look at what this legislation does. The claims by Senator Lambie are wrong in terms of what it does and what it does not do. And certainly you cannot claim to want to stand up against lawlessness, corruption and wrongdoing and then vote against the very measures that would ensure we have a serious legal framework to deal with those breaches. What you are effectively saying is that ripping off the workers will be treated as a lesser offence than ripping off shareholders and other members of our community. Who here who claims to stand for the workers could actually let that stand? This legislation, as part of a suite of legislation, should be supported to ensure that we have the rule of law across the board and that union officials and other representatives of registered organisations are held to account and to similar standards to what we have for leaders in the corporate world. I commend this important piece of legislation to the Senate.

Senator McGRATH (Queensland) (20:02): I rise to speak—

Senator Conroy: Oh no!

Senator McGRATH: Oh yes, he's back! It has started. That is a record. I think I had said two words, maybe just a syllable, and Labor interjects. That is a world record. A golf clap—almost jazz hands—in terms of the effort by Senator Conroy. I am very, very impressed, Senator Conroy—

Senator Conroy interjecting—

Senator McGRATH: and I will not let you down with what I am going to talk about tonight. This will keep you awake tonight. It will—

The ACTING DEPUTY PRESIDENT: Senator McGrath, direct your comments through the chair and avoid the distraction that Senator Conroy is clearly providing.

Senator McGRATH: He is very distracting—

Senator Conroy interjecting—

Senator McGRATH: He is the physical embodiment of jazz hands—

Senator Williams: Madam Acting Deputy President, I rise on a point of order. I ask you to draw to the attention of Senator Conroy standing order 197, which means interjections must be ceased. Either that or tell him to get over the fact that the Sydney Swans beat Collingwood last Friday night—one of the two, but please stop him interjecting.

Senator Conroy: I stand admonished.

The ACTING DEPUTY PRESIDENT: Senator Conroy, if you can contain your enthusiasm for democracy, Senator McGrath has the call.

Senator McGRATH: I am speaking here tonight, to those who are listening, on the Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2]. The measures in this bill are a key election commitment of the coalition and a matter of high public concern in light of the ongoing royal commission into registered organisations and the recent investigations into the Health Services Union.

The coalition first released its policy for better accountability and transparency of registered organisations in April 2012 and received widespread public support—so much widespread public support that we won the election in 2013 with this as one of our key election commitments.

The bill will amend the Fair Work (Registered Organisations) Act 2009 to establish an independent watchdog, the Registered Organisations Commission, to monitor and regulate registered organisations with enhanced investigation and information gathering powers. It will strengthen the requirements for officers' disclosures of material personal interests and related voting and decision-making rights and change grounds for disqualification and ineligibility for office. It will strengthen existing financial accounting, disclosure and transparency obligations under the Registered Organisations Act by putting certain real obligations on the face of the Registered Organisations Act and making them enforceable as civil remedy provisions. And it will increase civil penalties and introduce criminal offences for serious breaches of officers' duties as well as introduce new offences in relation to the conduct of investigations under the act.

The government is committed to improving the Fair Work laws so that we can build a more stable, fair and prosperous future for Australia's workers, businesses and the economy. The absolute need for this legislation almost goes without saying. The rorts, the rackets and the rip-offs have been in the media on an almost daily basis, and the wider community is strongly in favour of these reforms. Until this parliament acts, Australia will not have a sufficiently robust system to ensure that corruption of the sort that was revealed during the numerous scandals can be uncovered and eradicated before it becomes systemic, as it did in the infamous HSU case.

It is simply no longer tenable to argue that the present system is adequate to deal with or discourage this kind of behaviour. Unions and employer organisations play a critical role in the workplace relations system and in the economy more broadly, and their members invest a great deal of trust in them. The community expectation is that these registered organisations will operate to the highest of standards. These organisations are given special legislative rights. With these rights come responsibilities.

The government believes that the majority of registered organisations do the right thing and, in many cases, maintain higher standards than those that are currently required. However, the recent investigations into the Health Services Union illustrate that, unfortunately, financial impropriety can occur under the current governance regime for registered organisations.

The charges and allegations against former Labor Party member of parliament Craig Thomson and former Labor Party National President, Michael Williamson, in their capacity as officers of the Health Services Union are shocking and unacceptable. Mr Thomson was arrested in respect of more than 150 fraud related criminal charges and is facing allegations that his 2007 federal election campaign was partly funded by siphoning union money without authorisation. Mr Williamson has pleaded guilty to misusing almost $1 million of Health Services Union members' funds. Mr Williamson has also been accused of destroying documents and hindering investigations. Members of the Health Services Union are asking how this gross breach of trust could happen. Questions have also arisen with numerous other registered organisations. Members of registered organisations are asking whether this could happen in their own organisation.

The government believes the Fair Work (Registered Organisations) Amendment Bill will provide the certainty and high standards of operation that members of registered organisations are entitled to expect. The bill introduces a suite of legislative measures designed to see governance of registered organisations lifted to a consistently high standard across the board. A more robust compliance regime will deter wrongdoing and promote first-class governance of such organisations.

The recent HSU scandals also revealed that the current processes for investigating wrongdoing and ensuring accountability are clearly inadequate. The Fair Work Australia investigations into the Health Services Union took far too long and the ensuing legal proceedings remain ongoing. A KPMG review into Fair Work Australia's investigations into the Health Services Union identified shortcomings in the conduct of those investigations. Members of the union and the community not only want a strong regulatory regime to give them confidence in their organisations but they also want swift action taken when standards are breached. In order to do this, it is necessary to have a robust and strong regulator in place with appropriate powers and resources, together with meaningful sanctions that can be applied when wrongdoing is revealed.

To improve oversight of these organisations, the bill will establish a dedicated independent watchdog, the Registered Organisations Commission, to monitor and regulate registered organisations and provide enhanced investigation and information gathering powers. The new commission will have the necessary independence and the powers it needs to regulate registered organisations effectively, efficiently and transparently. The commission will be headed by the Registered Organisations Commissioner, who will be appointed by the minister.

The commission will have stronger investigation and information gathering powers than those that currently apply. These will be modelled on those available to the Australian Securities and Investments Commission, which will further enhance the ability of the commissioner to provide strong and efficient regulation of unions and employer associations. The commission will have the power to commence legal proceedings and refer possible criminal offences to the Director of Public Prosecutions or law enforcement agencies.

The bill also ensures that there are appropriate sanctions against efforts to hinder or mislead investigations. This will give all members of registered organisations confidence that should they make a complaint to the commission about a registered organisation, that organisation and its officials must comply with the requirements of the investigation process or face sanctions. Members can also have confidence in the fact that under the new legislation, a person convicted of particular offences will not be eligible to be an officer of an organisation or to stand for election to office. The commission will also educate, assist and advise registered organisations and their members in relation to the new obligations, and ensure members are aware of their rights.

The commission will be established within the office of the Fair Work Ombudsman. While it will be located within the offices of the Fair Work Ombudsman, the commissioner will have independence in the exercise of the relevant functions and powers under the law and the authority to direct staff in relation to the performance of those functions. A special financial account will also be established for the commission to ensure financial independence and the commissioner will have responsibility for day-to-day management of the account. The commission will be required to report to the Minister for Employment annually on its activities and that report will be tabled in parliament. The commissioner will appear at Senate estimates.

The activities of the commission will also be subject to the same oversight by the Commonwealth Ombudsman as Commonwealth agencies. This will ensure the appropriate level of transparency and public accountability. As is common with statutory office holders, the minister is able to give directions of a general nature to the commissioner. These directions must be in writing and are a disallowable instrument. For the avoidance of any doubt, it should be made absolutely clear that the minister will not have any powers to give directions as to a particular matter or investigation.

The bill also provides for information sharing between the Fair Work Commission and the Registered Organisations Commission to the extent that is required for both organisations to do their job effectively and efficiently. This is required as several administrative tasks relating to registered organisations will continue to be the responsibility of the general manager of the Fair Work Commission. Transitional arrangements have been included in the bill to ensure any ongoing matters being dealt with by the Fair Work Commission relating to registered organisations can be dealt with by the Registered Organisations Commission.

As well as establishing a strong, independent regulator, the bill introduces reporting and disclosure requirements and enhanced penalties for wrongdoing. Many registered organisations control assets worth millions of dollars. They are effectively dealing with the cash flow and investments similar to those of large businesses. That is why the bill introduces financial and operational reporting requirements for registered organisations that align with those outlined in the corporations law. This will strengthen existing financial reporting, disclosure and transparency obligations for registered organisations and officers. It is entirely appropriate to expect a high standard of financial reporting from our registered organisations given the trust members place in their unions and employer associations to operate honestly, and to use the funds derived from their membership fees to represent their interests rather than for ulterior purposes. Registered organisations have substantial economic, legal and political influence. It is clearly inconsistent with community expectations for such organisations to operate to lower standards than those that apply to corporations or other comparable bodies.

Registered organisations will need to disclose remuneration paid to the top five officers in the head office and any branches. Officers will be required to disclose their material personal interests to all members. This means disclosing the personal interests of officers and their relatives and declaring any payments made to persons or entities in which an officer has declared an interest. This aims to prevent individuals from improperly benefiting from their role in the organisation—for example, by an officer procuring goods or services from a company they hold some interest in without disclosing that interest and without an appropriate and transparent process being followed.

Registered organisations will be required to provide a summary of this information to members in an officer-and-related-party disclosure statement and lodge it with the commission. While corporations law only requires directors to disclose conflicts of interest to their fellow directors, the government believes that officers of registered organisations should be required to disclose such matters to members, as they are elected by members to represent their interests. Members deserve to know who is in control of their money and where any conflicts may exist.

Mr Thomson and Mr Williamson have shown us that the existing regulation does not sufficiently protect members' interests. Unfortunately, there will always be less scrupulous individuals who will seek to take advantage of their positions when standards of accountability are low and the risk of getting caught is also low. In the face of this kind of behaviour, a strong message needs to be sent to discourage wrongdoing by officers and to rebuild the confidence of members and the community.

Enhanced reporting and disclosure requirements and a strong and efficient regulator will have little impact if the penalties for wrongdoing are not high enough to act as a deterrent. Currently, registered organisations and officers do not face the same consequences as companies and directors for wrongdoing. That is why the government is introducing significantly higher civil penalties and a range of criminal penalties for those registered organisations and officials who do the wrong thing. These penalties are in line with those facing companies and directors who break the law.

In relation to civil penalty breaches, the maximum penalty for serious contraventions will be 1,200 penalty units for an individual and 6,000 penalty units for a body corporate. This will apply to serious contraventions. What will constitute a serious contravention is defined in the bill. Other breaches will be exposed to a maximum civil penalty of 100 penalty units for an individual or 500 for a body corporate. By way of comparison, the current maximum penalties for even the worst misbehaviour are only 60 penalty units for individuals. The Federal Court will also have the power to disqualify an officer from holding office where a civil penalty provision has been contravened and the court is satisfied that disqualification is justified. Criminal penalties are being introduced for serious breaches of officers' duties as well as offences in relation to the conduct of investigations under the Fair Work (Registered Organisations) Act. The maximum penalties in these areas are 2,000 penalty units or five years imprisonment or both.

It is the government's expectation and it is the coalition's expectation that the highest penalties will be rarely handed out, but it is important that the courts have the ability to hand down strong penalties should the crime deserve it. We know that the courts have had an issue with the current framework, with the Federal Court's Justice North making almost unprecedented comments last year, saying, 'The penalties'—under the current act—'are rather beneficially low—beneficial to wrongdoers.'

Broadly, these offences relate to officers and employees of registered organisations who fail to exercise their powers or discharge duties in good faith and for a proper purpose. They also apply where an officer uses their position to gain an advantage for themselves or someone else or uses information gained while an officer or an employee to gain an advantage for themselves or someone else.

Criminal sanctions will also apply where an officer does not comply with the commissioner's new investigation powers. These sanctions align with the penalties that apply to noncompliance with an ASIC investigation and will ensure that officers of registered organisations take their obligations and the directions of the commissioner seriously.

Some registered organisations have indicated concern that the new penalties will mean that they will have difficulty persuading people to take on official responsibilities. The government and the coalition do not agree with that. The only people who have anything to fear are those who do the wrong thing. A rigorous structure and process will be in place for investigation and prosecution of alleged wrongdoing. Officers who are operating within the law, which is the overwhelming majority of them, will have no reason to fear taking on official responsibilities. The overwhelming number of officers, who are already doing the right thing, should be comforted in knowing that unlawful behaviour will be dealt with, thus ensuring ongoing member confidence in the registered organisations as a whole. The coalition government firmly believes there should be no difference between the penalties levied against a company director who misuses shareholder funds and a registered organisation boss who misuses members' money.

There is broad community consensus for the government's amendments, including one actually from one of Australia's most prominent union bosses, a certain Mr Paul Howes, formerly of the Australian Workers' Union, who told the ABC in November 2012:

I actually believe there is a higher responsibility for us as guardians of workers' money to protect that money and to act diligently and honestly. The reality is I do not have any issue with increasing the level of requirements and penalties on trade unions for breaching basic ethics like misappropriation of funds.

The government's intention is to see the Registered Organisations Commission begin operation as soon as possible, from early next year, with new disclosure and reporting obligations, higher civil penalties and new criminal sanctions coming into effect as soon as practical. This timing will align with the reporting obligations on a financial year basis and will provide registered organisations and officers with time to become familiar with the new obligations and the penalties associated with those obligations.

In developing the bill the government consulted with the National Workplace Relations Consultative Council members through the Committee on Industrial Legislation, including employer and employee associations. The government has made a number of key changes to the bill, as well as several minor and technical amendments, in response to the feedback received. The government thanks those committee members for taking the time to review the draft bill.

The only people who have anything to fear from these amendments and this bill are those who have done the wrong thing. Anyone in this place who has a regard for the members of registered organisations and their money will support the bill. Any political party that refuses to support this greater accountability and transparency for registered organisations is voting to give the green light to more of the same behaviour that we have seen from the Labor Party's Mr Williamson and the Labor Party's Mr Thomson. It is simply no longer tenable to argue that the present system—

Senator Conroy: Are you still going? I nodded off.

Senator McGRATH: Senator Conroy is like a bookend in speeches, isn't he? He starts at the beginning and sparks up and then goes back to sleep—through you, Madam Acting Deputy President. He has a little slumber and then, at the end, he perks up a little bit. We are the poorer for that, Senator Conroy. I really do think you could interject more, because you add a certain je ne sais quoi to the Labor Party's approach to this bill, and that is missing.

This government believes that the bill sets a suitably high standard for the governance of registered organisations. I call on those opposite to support the bill. (Time expired)

Senator REYNOLDS (Western Australia) (20:22): I too rise to speak in support of the Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2]. This bill implements the government's election commitment outlined in the policy for better transparency and accountability of registered organisations. It will enhance the accountability and transparency of registered organisations by broadly aligning the obligations of office holders and the penalties and powers of the regulator with the Corporations Act 2001. Having a look at the detail of this bill, it absolutely blows my mind that anybody in this chamber could possibly not support the provisions of the bill. The fact that so many people on the other side are not supporting this, to me, very personally demonstrates so much of what is wrong with politics today.

Since the introduction of the 2013 bill, the Royal Commission into Trade Union Governance and Corruption has been established. The royal commission is inquiring into, amongst other areas, slush funds and other similar funds and entities established by or related to the affairs of trade unions. In its interim report, the royal commission made findings in relation to the conduct of officers of registered organisations, including that the maximum penalties for breaches of general duties in relation to financial management are too low, that breaches of officers' duties are significant and widespread and that, in some instances, there is a deliberate disregard for the law. Again, how is it possibly in workers' interests for the trade unions to have been allowed to get away with this sort of behaviour for so long? These interim findings of the royal commission, combined with the Health Services Union saga, illustrate the need for the measures proposed in this bill.

The bill increases civil penalties and introduces criminal offences for serious breaches of officers' duties similar to those applicable under the Corporations Act. The bill also establishes the Registered Organisations Commission as independent but within the office of the Fair Work Ombudsman. Most importantly, especially for those opposite who claim this to be a partisan venture, the policy principles behind this bill are supported by a range of Labor luminaries—your colleagues and ex-colleagues. Who have we got supporting this? We have got Simon Crean.

Senator Williams: Ah, good man.

Senator REYNOLDS: Yes. We have got Martin Ferguson. We have got Robert McClelland. We have even got Paul Howes and Ian Cambridge. They are all doyens of the labour movement and they are all saying that this is the right thing to do, and it is the right thing to do because it is the right thing to do by union members.

This bill also addresses concerns raised in the Federal Court by His Honour Justice Anthony North, who said that the penalties under the existing legislation are beneficially low to wrongdoers. That means people are not getting penalised as they should for misuse of union funds and other misbehaviour. This legislation will bring penalties in line with the Corporations Act, because we believe there is absolutely no skerrick of difference between a dodgy company director who is ripping off shareholders and a dodgy union boss who is ripping off members. Again, when you look at it that way, you think, 'How on earth is it that the people opposite, who say that they represent the workers and are there fighting for the workers' rights, cannot even give workers the same rights that shareholders have to protect them?' It is an utter, utter disgrace.

I want to absolutely stress that the only people who have anything to fear from this bill are those who are doing the wrong thing by the workers of this country. I also want to reaffirm that the government firmly believes that the vast majority of officers of registered organisations absolutely do the right thing.

This bill was previously voted down in the Senate, but the primary reasons that the opposition opposed the bill are actually issues enshrined in the legislation as it currently stands today and are in full force. Something again that is quite astounding to me is that the onerous disclosure obligations that currently exist were in fact imposed by the Leader of the Opposition when he was the minister for workplace relations, and they will be removed under this government's bill.

Having a look at this bill and having a look at some of the history to this bill, I really had to start wondering why the Leader of the Opposition and those opposite would oppose these provisions. In my short time in this place, I have come to appreciate that, the louder and more aggressive the blokes on the other side of this chamber get, the more you just know there will be something they will want to hide with all the bluff and the bluster. Interestingly, the loudest in this chamber in my time so far appear to have been ex-trade union officials—a coincidence?

Senator Williams: They all are!

Senator REYNOLDS: I know. It is pretty hard not to find one. But is that a coincidence or not? Having a look at the facts, my strong and deep suspicion is that it is linked and it is no coincidence. To test this hypothesis, I went back and had a look at the facts—not the rhetoric—and what is behind this well-worn tactic of those opposite of denying, defending and attacking: deny, defend, attack; deny, defend, attack. What are they trying to hide behind that? When I sought to understand why those opposite do not support this bill and the protection of the workers that unions represent, it did not take long to really understand why those opposite do not support this bill and are now trying so hard to discredit the royal commission. Sadly I had to narrow it down to the top 10 reasons that have come out of the royal commission because, simply, time in this chamber would not permit more.

Senator Conroy: Oh dear, the royal commission-er!

Senator REYNOLDS: Mr Acting Deputy President, if Senator Conroy does not think what I am about to read out are issues that every trade unionist and those opposite should not hang their heads in shame about at the impact on the trade unions—he might heckle but let him heckle after I have read out these absolutely blatant horrendous things that are happening against the people he pretends to represent.

It was impossible to rank them because they are all so heinous. However, the first one I identified was: CFMEU officials Brian Parker and Darren Greenfield consorted with underworld crime figure George Alex. Alex's friends and colleagues include Mick Gatto; former Comanchero Bilal Fatrouni; senior Rebels bikie Abuzar Sultani; standover man Vasko Boskovski; recently murdered career criminal Joe Antoun; and infamous ISIS jihadists Khaled Sharrouf and Mohamed Elomar, who did weight training, out of interest, in his backyard and joined Alex on a shooting trip shortly before escaping Australia to fight with ISIS.

Senator Conroy interjecting—

Senator REYNOLDS: You might find that funny, but I think it is an absolute disgrace on behalf of all trade unionists in this country.

The second one: Comancheros being used as debt collectors for trade unions. The facts: assistant commissioner of Victoria Police Steve Fontana confirmed that the Victoria Police had evidence showing the overall infiltration of the building and construction industry by organised crime. He indicated that outlaw motorcycle gangs, including the Comancheros have been regularly engaged as debt collectors on behalf of the industry. Victoria Police are concerned that the methods for debt collection in the industry involve criminal conduct such as assault, threat to assault and intimidation. Presumably, it is trade union members' money that is going to these outlaw motorcycle gangs, including the Comancheros. That is No. 2.

What is No. 3? No. 3 is: construction company pays Bill Shorten's election campaign director—which he, oops, forgot to declare. Mr Shorten accepted a $40,000 donation from construction companies—

Senator Nash: How much?

Senator REYNOLDS: $40,000, Minister—to pay the wages of his election campaign director in 2007. But, guess what? He did not disclose until—how many days do you reckon before the royal commission asked him about these matters in sworn evidence?

Senator Williams: Two.

Senator REYNOLDS: Two, that is right. From 2007 through to this year, he had forgotten to mention a $40,000 donation. He also relied on assistance from an AWU staff member to formalise this arrangement, which he also did not disclose and does not appear to have refunded.

Senator Conroy: It took the royal commissioner a year and a half to remember it was a Liberal fundraiser.

Senator REYNOLDS: Senator Conroy, the truth is the truth. As much as you might not like hearing this, it is a shame and a disgrace, and you are now defending it.

Ah, but that was not only it! The Leader of the Opposition also failed to disclose $12,700 for this worker plus $11,000 for a part-time campaign worker that was donated by—guess which union? The AWU—what a surprise. He only included this in a late disclosure—again, how many before the royal commission, do you think? It was two days before the royal commission evidence he gave. That is No. 3.

What do we think is the fourth absolute disgrace is? It is Bill Shorten himself cutting workers' conditions. Isn't that somewhat ironic—trade union members are paying for unions to represent them, and what is he doing? He is doing what I would call dodgy deals to cut their wages. How did this happen? The commission heard that under the 2006 Cleanevent agreement, signed under the authority of Bill Shorten as national secretary of the AWU, workers were deprived of penalty rates, public holiday pay, overtime and shift loadings. This was under a deal authorised by Bill Shorten himself.

As Victorian secretary of the AWU, Bill Shorten also approved an agreement to allow a group of mushroom pickers to be fired and mostly rehired as casual labour. It saved the company millions from the abolition of overtime rates, amongst many other savings. This was from a man who purports to be standing up for the workers of this country—absolutely disgraceful. That is No. 4.

What is No. 5? No. 5 relates to Boral. On construction sites in Melbourne, the law is determined by the CFMEU. Pointing to numerous examples of secondary boycotts, cartel behaviour, racketeering, intimidation, illegal black-banning and criminal conspiracy, Boral CEO Mike Kane lashed the CFMEU as 'an organisation that openly admits it has and will continue to break the law'. Kane revealingly stated that on construction sites in Melbourne, the law does not apply; the law is determined by the CFMEU. Guess who they employ to do their enforcement? The Comancheros.

No. 6: Bill Shorten's close friend and AWU associate Cesar Melhem and false invoice incidents. The royal commission heard evidence that Cesar Melhem repeatedly issued false invoices to companies marked 'training', 'OH&S' or similar when they were actually payments for union membership. These were not small amounts of money. Any amount of money would be wrong but this was for hundreds of thousands of dollars. The AWU membership roll contained the names of workers and horseracing jockeys, who had never agreed to become members of the union. Mr Melhem also made a side deal in which cleaning company Cleanevent agreed to pay the union $25,000 per year for three years—$75,000—for undisclosed services in order to retain an enterprise agreement that left their workers with substantially worse than award pay rates. That is an absolute disgrace. That is No. 6.

No. 7 of my top 10: Bill Shorten's close friend Cesar Melhem and the Industry 2020 slush fund—yet another sad saga involving them both. The royal commission heard evidence of a slush fund, euphemistically entitled 'Industry 2020' set up by former AWU state secretary and sitting ALP Victorian MLC Cesar Melhem. Despite being structurally separate from the AWU, this fund—aka the slush fund—received regular payments from companies which had EBAs with the union. It employed no staff and had no premises of its own. However, all Industry 2020 fundraisers were organised and run by AWU officials and used AWU resources. Through these fundraisers, Industry 2020 received contributions from other unions such as the Victorian branch of the NUW. The most high-profile Industry 2020 fundraiser was a $550 a head lunchtime function at Flemington Racecourse addressed by the then Deputy Prime Minister Julia Gillard.

What is no. 8 on the shame roll? It was the    CFMEU receiving leaked details from Cbus members. The private details of over 300 construction workers were leaked by the construction industry superannuation fund Cbus to the CFMEU. What a disgrace. As a result of the leaks, construction workers were contacted, intimidated and threatened by CFMEU officials. And guess who the CFMEU officials employ? The Comancheros.

One of the Cbus officials who leaked the information to the CFMEU gave evidence that she was absolutely terrified of what the New South Wales secretary of the CFMEU would do to her and her family if she told the royal commission the truth about this leak. When an organisation like the CFMEU who uses Comancheros to do their enforcement, it is amazing that this woman had the courage to come forward.

No. 9 on the role of shame is John Setka's threats. Allegations were made in the royal commission that the CFMEU had threatened contractors at the Pentridge Village residential development site to sign a CFMEU enterprise agreement and that they had pressured construction workers to join the union or otherwise face being black-banned. The developer testified that CFMEU state secretary John Setka demanded that the concreter Paul Costa be kicked off the Pentridge Village site simply because he was related to Daniel Grollo who Setka hated—again, utterly, disgraceful.

No. 10 on my list—and, as I said, I have a very long list and there are many, many more examples—is where a police officer arrested a former CFMEU official who gives evidence. ACT police arrested a former construction union organiser and previous Labor Party sub-branch president after he admitted to accepting tens of thousands of dollars in payments from tradesmen to help them win work. The CFMEU organiser was arrested after evidence revealed at the Canberra hearing of the commission. This was not of the commission's making; this was evidence he gave to the commission.

Mr Kivalu, who was president of the ALP's Dickson-Morning sub-branch in Canberra at the time he was allegedly involved in corruption, denied the cash payments constituted a bribe. When he resigned as the ALP sub-branch president, he was replaced with guess who? Another union official from the CFMEU who has also been the subject of adverse allegations at the commission—again, a pattern of behaviour time and time and time again.

Having a look at those facts and that evidence—and the weight of evidence—it became very apparent why those opposite and the Leader of the Opposition so staunchly support their trade union mates and their supporters. It is a story of utter shame, and sometimes I do not know how those opposite can possibly still support the trade unions, knowing exactly what the trade unions are doing to their workers.

It is very clear when you cannot discredit the facts that you try and discredit the man. That is exactly what is happening now with the royal commission: deny, attack, defend. Deny, attack, defend. Deny, attack, defend. If you concentrate on discrediting the commission enough, you are hoping that all of these facts will disappear. Let me tell you: they will not disappear—

Senator Bilyk interjecting—

Senator REYNOLDS: no matter how hard you scream in this chamber. Deny, attack, defend—but the facts are here and the evidence is very, very clear.

So what are the changes that you are so opposed to? The government is making changes to remove unnecessary disclosure requirements on officers and organisations that were first included by the previous government's 2012 amendments to the Fair Work (Registered Organisations) Act 2009. These changes will ensure that only disclosing officers, those whose duties relate to financial management of the organisations, must disclose their material personal interests; and officers no longer need to disclose the material personal interests of their relatives.

The bill now also ensures that financial officers with relevant experience can apply to the Registered Organisations Commission for an exemption. These are all issues that were identified by Labor as problems. They are problems that exist in the law as it stands today. They acknowledged it. They know it is still the case. They are problems created by Labor yet again, and we will fix them with this bill.

There is a pressing need for this bill and for the establishment of a registered organisations commission to protect union members' and the funds that come out of their hard-earned pay. As we have seen, time after time and again and again, that out of the royal commission and elsewhere something has to change. Somebody has to stand up for these workers, and it is for all of those reasons, that I support this bill.

Senator CANAVAN (Queensland) (20:43): It is a great honour to stand up in support of this bill, the Fair Work (Registered Organisations) Amendment Bill 2014 [No. 2]. It is an opportunity to support stronger regulations in what is a very important sector in our economy. It is also an opportunity for the Labor party to demonstrate to the Australian people whose side they are on—whose side are you on? Are you on the side of the worker who has to work hard to pay their union dues? Are you on the side of people who want proper protection in the workplace; or are you on the side of the people who run unions currently? Are you on the side of people who have been exposed as mishandling and misusing members' funds?

It will be very interesting to see which way the Labor Party votes on this, because it will reveal whose side they are on. Are they on the side of the workers as they actually say in this chamber over and over again; or are they on the side of their political puppet masters who control the strings of their positions here in the Senate and sometimes in the lower house? We all know how many senators here from the Labor Party owe their positions to unions. It is almost all of them and, because they do, they are somewhat conflicted on this bill. They say that they stand up for the worker. They say they stand up for people who do it tough and are on or below average wages, and they want to get a better deal for them.

I do not think it was a good deal for the nurses of New South Wales who have to empty bedpans and work hours away from their families They have to do all of those things and pay their dues to their union and then have people like Mr Williamson and Mr Thomson defraud them of their money by going and spending that money on fancy dinners, travel, some establishments we will not mention here in this chamber and also just little incidental things. I remember when that report by the Fair Work Commission came out on the conduct of Mr Thomson in particular. I remember that it was not just that he was living large, living on the hog from the work of ordinary health sector union members. It was also that he was using his corporate credit card, or his trade union credit card, as his own personal piggy bank. You could see in the transactions exposed by that report that day after day he would go to the local service station and buy a chocolate bar or buy a soft drink, all on union money. It was all personal expenditure, all with a complete lack of care and fiduciary duty for his own members' money.

It will be very interesting to see on which side the Labor Party comes down on this because these changes here have their genesis in those allegations from a few years ago. They are a specific response that the coalition crafted after those sordid details were exposed. It was something that the coalition took to an election. We took a promise to the Australian people that we would get tough and we would strengthen the requirements on trade union officials to make sure that people who do the wrong thing are held to some form of account. That is all that this bill does. All this bill does is try to make sure that the behaviour and actions of trade union officials are disclosed to their members, as they properly should be, and that, if they are found to be doing the wrong thing, they are subject to appropriate sanction and discipline by the law, as they should be.

So whose side are the Labor Party on? Well, maybe I should not ask, because I think I am going to be disappointed. I do not think they are actually going to be on the side of the worker here. I think they are going to come down, once again, to favour the trade unions and to favour officials in very well paid and secure jobs, against the interests of their own workers, who do not necessarily share those same benefits.

Unions were set up for a purpose. In my maiden speech I mentioned that trade unions have done good work over a number of years in our community and in other countries to improve the lot of workers, but some have travelled far from that original purpose, no longer have the interests of their own members at heart and seem to act for their own personal gain before they act for the collective interest. I believe that is often a consequence of the fact that we have substantially protected trade unions in our legislation over the years.

We have a registered organisations act from this parliament which provides trade unions with very special privileges. They are somewhat exempt from competition from other unions establishing to try to get members in their area. You can take the Health Services Union as an example. Notwithstanding the conduct of Mr Thomson and Mr Williamson, particularly in the New South Wales branch of the Health Services Union, because of the way the registered organisations act is written, no other union could be formed to offer membership to workers in that sector if they could conveniently belong to the health sector union as it stood. There is a provision in the Fair Work Act which says that, if someone can conveniently belong to an existing union, someone cannot set up and establish a different union to compete with them.

That is the economic equivalent of saying: 'You must buy milk from this supermarket. That's it. That's the only supermarket you can buy milk from. You've got no choice.' What do you think is going to happen to the price and quality of milk in that environment? It will fall because there will be no discipline; there will be no choice on the part of the consumers; and you will get bad outcomes. One of the greatest things we have in this country, if not the greatest thing, is our choice: our choice to do as we feel like in our lives, to buy what we like and to live with whom we like. If Senator Nash did not like her cup of coffee this morning, she can go to a different cafe tomorrow and get a better cup of coffee. Through that process we get good cups of coffee. We have pretty good cups of coffee in this country because we have choice.

If you do not have choice, you get bad outcomes. If you do not have choice on who your political party leader is, you get someone like Bill Shorten, because the Labor Party do not have a choice on who leads them now. They have locked themselves into Mr Shorten because they have taken that right away from themselves, and then you get bad outcomes. You get bad outcomes like the current Leader of the Opposition. That is what happens when you do not have choice. I would encourage the Labor Party to embrace the concept of choice and once again open up the leadership of the Labor Party. You might get a better outcome, not that I would wish for that, but at least choice would be returned to their membership.

I want to mention one more thing. Not only do we have a Fair Work Act which protects trade unions from a competitive environment but we also exempt trade unions from various provisions of the Competition and Consumer Act that other organisations are subject to—in particular, collective bargaining and collusive behaviour. If farmers want to collude, if farmers want to get together and bargain in a collective fashion like a union does, they need to meet certain public interest tests under the Competition and Consumer Act before they enter into a collective bargaining arrangement. Unions are lucky not to have those restrictions placed on them. Once they are a registered organisation under the Fair Work Act, they can be exempt from those particular provisions and legally collude as often as they like.

We are not arguing against that in this bill. As I said earlier, unions have played an important role in our society and continue to, and if this bill is passed we will continue to have unions that are exempt from provisions of the Competition and Consumer Act and that can collectively bargain with their employers to get the best deal for their workers. What this act is all about is providing a more effective, more transparent and more accountable trade union sector than currently exists. This is a pro-worker bill because it will help return power to the members of unions, who are actually the workers. The members of unions are the ones who should be able to run and hold accountable the people who run their unions. This bill will help them do that.

The only people who should be afraid of this bill are those people who are doing the wrong thing, because all this bill does primarily is increase penalties for people who are doing the wrong thing. So, if you are a trade union official who is doing the wrong thing, you should be afraid of the legislation passing through tonight. But, if you are not doing the wrong thing, if you are acting in the interests of your members—and I would hazard a guess that the majority of trade union officials are doing the right thing and, as usually happens in society, it is just a few bad eggs—you will have nothing to fear from this bill. So why are the Labor Party so afraid of this bill, Senator Nash?

Senator Nash: I do not know.

Senator CANAVAN: I do not understand why they are so afraid of this bill. It must be because they get support from some people who are doing the wrong thing. That is why they are afraid of this bill and that is why the Greens are afraid of this bill, too. We know that they get significant support—not just some support—from people who seem to be doing the wrong thing right now. We know that the CFMEU bankroll the Labor Party and the Greens. They provide substantial amounts of money. The serious allegations of misconduct that have been revealed in the royal commission and the serious and contemptuous behaviour of some CFMEU officials, particularly with regard to women—absolutely disgraceful conduct—should be condemned by all sides of politics but unfortunately it is not strongly condemned by those opposite because they get bankrolled by the union.

These days many political parties do not take donations from certain sectors—like tobacco and other sectors we feel are not doing the right thing. The Labor Party and the Greens often sanctimoniously stand up and say they will not take donations from particular sectors—because they are pure and they are nice and they stand up for what is good and right in the world—but when their financial masters, the CFMEU, engage in conduct much worse, much more beyond the pale, than many of those other sectors, those opposite do nothing because they rely so heavily on that money. In my view, their vote on this bill will be reflective of the money they receive from the CFMEU.

In the time available to me, I should outline precisely what this bill will do. The Labor Party would have you believe that this is some retrograde, almost fascist, piece of legislation, when in fact all this legislation does is make the obligations on trade union officials somewhat comparable to the obligations that are placed on directors of corporations. We provide corporations with certain privileges, particularly limited liability, and it is right and proper that we place serious obligations on the directors of corporations in return. It is the same principle here. We protect trade unions from competition and from having to justify their collusive activities and, in return, we should expect the highest standards of conduct from those officials.

This bill will establish an independent registered organisations commission to oversee the obligations of the Fair Work Act to make sure that registered organisations are doing the right thing. The bill will also strengthen the disclosure requirements placed on officials of trade unions, so that their members can be informed of what they are up to and what their conflicts of interest are. I will say upfront that the conflict of interest obligations we are imposing in this bill go somewhat further than the Corporations Act, because we think it is really important that trade union officials, in particular, show their members what conflicts of interest they have. Most significantly, this bill will increase the civil penalties associated for breaching the registered organisations provisions of the act and it will introduce some criminal offences as well—again comparable to the Corporations Act.

The coalition, in opposition, developed these proposals very soon after the allegations with respect to the HSU were exposed a few years ago. These proposals were rejected at the time by the then Labor-Green government, and I imagine they will be rejected again by the Labor-Green opposition. They were rejected when the Labor-Green government were in power. They were rejected when former Prime Minister Julia Gillard was there. She relied heavily on union support to maintain her leadership of the Labor Party and—surprise, surprise—they opposed these very moderate, very reasonable and very sensible responses to that particular crisis. And they are going to reject these proposals again because they still rely heavily on the unions.

I was a bit young to remember, but I have read about a former Prime Minister of the Labor Party, Bob Hawke. I remember reading that former Prime Minister Bob Hawke took some serious and strong actions against unions that were doing the wrong thing in his time. He actually had guts. He actually stood up against people who were clearly acting beyond the bounds of reasonable conduct. He deregistered the Builders Labours Federation for conduct not dissimilar to the conduct that the CFMEU engages in today. Former Prime Minister Bob Hawke also stood up to the pilots who, in the late 1980s, were on strike about certain reforms. He stared them down and won a great victory for our country that has provided us a much more competitive and efficient airline ever since—something which has not been opposed by any Labor government since that time. He did that because he had guts and he did not just follow. The unions were not just playing Pied Piper to his followers. He was not leading a government of lemmings.

Unfortunately, we now have a Labor Party that are lock, step and barrel constantly tied to the unions. They will not deviate one iota—will not step off their right foot—to sometimes do what is right for the country rather than what is right for their own sectional interests. It is very unfortunate that we now have a Labor Party like that, because these kinds of reforms are something that we should be able to bring in in a bipartisan way. We should be able to respond to serious misconduct in the union movement. No-one could deny that the behaviour of certain union officials in the last few years has been deplorable. We should be able to respond to such activities with a sensible and strong response, by strengthening the penalties and requirements of the act, to make sure that such activities do not happen again.