Senator HANSON ( Queensland ) ( 09:32 ): I introduced the Lands Acquisition (Public Purpose) Bill 2017 in response to the recent actions of the government in issuing declarations of intent to acquire land from Australian farmers in both the Rockhampton and Charters Towers regions of Queensland. The federal government's statement, as contained in correspondence to landholders, was that the land acquired would be owned by the Department of Defence and allow for expanded training exercises by the Australian Army, as well as facilitating an increase in use by the Singaporean army from 6,000 troops for periods of six weeks to 14,000 troops for up to 18 weeks. The Army had only sent out the correspondence in regard to these acquisitions following an inspection by the Singaporean army. The Singaporean army had stated that it wanted the land for its future training purposes, as indicated in the department's correspondence about the land in question.

At public meetings held with the landowners by the Army, it was clearly stated that the primary purpose of the land acquisition was that the land was being acquired not for the purposes of the Australian Army but for the use and training of the Singaporean army. The government referred in their correspondence to the Australia-Singapore Comprehensive Strategic Partnership, which included a general arrangement pursuant to the Singapore-Australia Free Trade Agreement. The SAFTA refers only to cooperation between the two countries in a number of areas, including the military as well as technology and agriculture cooperation areas of interest. It does not place an obligation on Australia or Singapore.

The Army has a land area in the Shoalwater Bay training complex of approximately one million acres, yet the Australian Army stated this was not sufficient. There was no consideration of the interests held by the Australian landowners—where exactly was the 'public purpose' required by the legislation? I would just like to expand on this. The Australian Army has quite extensive land in the Shoalwater Bay area, and yet it was wanting to allow the Singaporean army to buy up more land around that area—prime agricultural land—from farmers. What has happened to the Australian land is that over the years they've said, 'We can't use this land.' Why? Because of the overgrowth, because of the number of trees on it. Over that period they have not been able to clear the land because of the environmental laws of the Queensland government. So, here we have the situation of, 'Oh, we can't use this land, so we'll just let it sit there, but we'll go and acquire some great agricultural land that is producing thousands of head of cattle,' which were being sent to market, providing jobs in abattoirs and in the ongoing businesses in the whole area. But they're ready to say, 'No, we just need to acquire some more land,' as if you can pick up prime agricultural land anywhere in Australia. It is not the case. That land is so valuable, and it's so necessary to keep it as that.

So, public purpose—the whole intent of this bill: where was the public purpose as required by the legislation? There was absolutely no public support for this acquisition, nor was there any purpose behind it that benefitted the Australian public. People I spoke to when I went up to Charters Towers—and we're talking about between 50 and 60 farming families looking down the barrel of a gun at losing their properties—they said no-one was listening to them. These are properties that have been handed down through several generations and that people had bought and worked extremely hard to improve. This is where they want to live, and naturally they want to hand their properties down to their children.

And this was all so that Singaporean army personnel could come out here and train for a few weeks a year. We're talking about more land than the size of Singapore itself, land that they are wanting to buy up. The Army had stated that the public would benefit from this acquisition. Well, I beg to differ. No benefit could be demonstrated, but significant detriment could clearly be demonstrated, not only to the landholders who were directly affected but to the entire regions of Rockhampton and Charters Towers. They were saying that the Singaporeans were going to come and increase tourism in the area. But the tourism was actually going to destroy a small country town called Marlborough. It's not a tourist area, but the businesses there would have been affected, because they would no longer have the trade from the farming families living there and going into town to use the post office or go to the local pub. The Singaporeans would be going to Townsville, buying up the accommodation there. They had plans as to where they wanted to go during their time off. The loss to Australia was approximately 800 acres of prime grazing country and over 90,000 head of cattle that would have been going to local abattoirs, with the inevitable closure and the loss of employment in both regions—as I said, the loss of over $90 million in cattle sales, and twice that figure after the processing of the cattle from sales by the abattoirs.

We have seen our state of Queensland go through dire straits with droughts, and farmers can't even keep the cattle on their property. Yet here we are taking another 90,000 to 100,000 head of cattle out of the marketplace, I heard. So, on top of the drought we're putting ourselves in the dire situation in which we won't even have enough cattle in Australia for our own needs, let alone for export. Yet the government—or anyone—had no concerns about the impact this would have on Australia. At the briefings to the affected landholders, the Army representative stated that the local community would be providing food, hospitality and transport, to name a few. However, it was then found that the Singapore government had already sought expressions of interest from offshore companies for the transportation of food and ordnances into the area, supplied directly from Singapore—not from one Australian company. We were told that the Singaporeans were going to bring $2.5 billion into the country, and we were going to make so much money out of this and it was going to be great for the country. No, it wasn't. It was the worst deal that was going to happen. And, as I said, they had lined up Australian shipping companies to bring in their food and ordnance from overseas. This was not a good deal for us.

The government stated it was supporting rural communities, but here it was destroying two communities, offering no compensation to businesses other than the landowners, who didn't want to sell. Only a couple of people sold, because they were issued enormous amounts of money for their properties—the hope being that if one fell over then the others would. But the majority of farmers that I spoke to didn't want to sell their properties. They were being forced into it. Additionally, in the Charters Towers region, Infrastructure Australia and the Prime Minister of Australia had listed the Hells Gate Dam project as a high-priority project, which the Prime Minister did—it was in his election promises, and in the first meeting I had with him I spoke about going ahead with Hells Gate Dam. But the very land that could benefit from the dam was the very land the army had stated it was interested in acquiring. So what is going to happen? Are we going to build the Hells Gate Dam and then just hand the property over to the Singaporean army? It doesn't make sense to me.

When I raised the issue at a briefing, the army representative stated he was unaware of this priority infrastructure, as did the department's representative. So, was the right hand talking to the left hand, or does no-one know what the hell is going on? Yet the farmers up there were so distraught because they didn't know what was happening with them. It was a clear case of a compulsory acquisition not having a direct public purpose, as required by the act, but instead appearing to benefit a third party. So I ask the question: where was the public purpose?

The Australian Army only sent out correspondence in regard to this acquisition following an inspection by the Singapore Army. Its statement specified that it wanted the land, as indicated in the correspondence, as 'land of interest'. So it's up to the Singapore Army. They went out and said, 'Mate, this is what we want.' The term 'public purpose' is more than the vague legal definition of the act referring, as it does, to those legislative areas for which the parliament has power to make laws.

The key element in the land acquisition proposal by the Australian Defence Force was the definition of 'public purpose'. An information guide published by the Department of Finance and Deregulation in May 2011, titled The Commonwealth and You: Compulsory Acquisition of Land, states:

The Minister issues a document to affected landowners, which states that the Minister is considering the acquisition by the Commonwealth land for a public purpose. This document is a pre-acquisition declaration.

It tells you which Commonwealth authority wants to acquire the land;

It describes the land fully;

It states that the Minister thinks the land appears to be suitable for a public purpose;

It states the public purpose the land has been chosen for; and

It explains why the Minister considers the land suitable for the intended use.

But there is no clarity on the meaning of the term 'public purpose'.

In general Australians understand that, because the country has grown, we need infrastructure. They may not like it, but they understand if their land has to be acquired for maybe putting in a dam or maybe for roadworks, a motorway, a hospital or for some other reason that is of a general benefit to the public. They don't like it, but they will actually accept it if they're paid the right compensation for it. But I understand, and this is why the farming families have my total support, that when it came to this they were going to lose their properties—for what? So that Singaporeans can come out here for six weeks or 18 weeks a year and train, when we have so much land in Australia and when there are other training areas? They should have been going to Western Australia or even up to the Northern Territory, but, no, they wanted prime agricultural land in Australia and their hands were tied. They were having meetings with the Defence Force. They were having meetings with other people. No-one was listening to them. It was well attended by people in the area at public meetings.

The second reading speech on the introduction of the Land Acquisition Act 1989 adds little to the meaning of the words other than referring to section 31 of the act. However, the following sentence is relevant as it gives the tenor of the purpose of the words within the meaning of the act:

This Government is concerned by the need to strike a balance between the rights of private property on the one hand and the legitimate needs of society for land for public purposes on the other.

This sentence within the second reading speech clearly delineates that the acquisition is for the benefit of society. There was no substantive debate on what the phrase 'public purpose' meant. The reason why one has to revert to external explanations is due to the vagueness of the definition within section 6 of the act, which states as follows:

… public purpose means a purpose in respect of which the Parliament has power to make laws and includes, in relation to land in a Territory, any purpose in relation to the Territory.

In judgements on which the issue has been raised, the acquisition must be for the primary benefit of the community and Australia generally. Well, that certainly wasn't the case when it came to destroying our prime agricultural farming land, displacing Australians for the Singaporean army to train out here. I ask the question: What deals were done?

We cannot allow this to happen. I feel for the Australian people. I know what it's like to work hard to own your own land, to love the land that you're on and then to have someone come and say, 'Oh, no, you've got to give it up because we want Singaporeans to train here with no benefit to this country whatsoever.' This is especially so when, as I stated, there is other land they could train on in this country. It's about time that members in this place and the other place started listening to the Australian people and their pain and what they're going through, not listening to the bureaucrats and those others that have no idea. It is the grassroots Australians that are being forgotten.

There has been very little case law on the meaning of the words 'public purpose', particularly in the context of like cases of acquisition for the primary purpose of land for the training of a foreign army. Irrespective of the wide ambit of the definition of the words 'public purpose' within the Land Acquisitions Act of 1989, it is evident from case law that such an acquisition must be shown to actually be for the benefit of the public. The bill, which I seek the support of all parties for, clarifies the meaning of those important words 'public purpose'. It is important for all Australians that they know their land and their heritage will never be compulsorily acquired for the benefit of an unrelated third party and, as far as I'm concerned, especially for a foreign third party.

Before any declaration is made by any department to acquire an interest in land, the bill will require that department to demonstrate the purpose of using that interest or for its need for that interest to provide services. The acquiring authority must show that the need will be for the direct benefit of the Australian public or for the provision to the Australian public of necessary services.

The bill does not alter the intent of the original act. It clarifies the meaning and intent of the act so that the Australian public will never again be subject to months of upset and costs in trying to protect their interest for the ongoing benefit of their families. I hope both sides of this chamber and the minor political parties clearly look at what I'm putting forward here if they truly want to represent the people of Australia. If they saw the faces of these farming families and what's going to happen to them, they would understand. They could be our sons, our daughters, our brothers, our aunts, our cousins—our families. These people are clearly looking to us to stand up and fight and represent them. It is not up to the bureaucrats to make these decisions. It is not up to these foreign interests who say, 'We want this,' or 'We want that.' It's up to us to make the right decisions on behalf of the people who are relying on us to fight for them and stand up for their rights.

As I said to you earlier, I've got no problems with acquiring land for the right reasons, because this country is growing rapidly. But when we are asking people to give up the land that they love, people who have seen their families fight in the past for their land and for freedom for their way of life in this country, and we are prepared to allow it to be sold to a foreign power—to the Singaporean army, so that they can do their training—that's not good enough, as far as I'm concerned.

All I'm asking for in this bill is that if anyone's going to acquire land then we should make sure it is in the best interests of the Australian people, not of a foreign power. Give the Australian people some stability so they know that the decisions being made are right for them and for future generations.

This bill overcomes the vagueness of the existing definition but gives clarity to the meaning of the term 'public purpose' without the need for future litigation. The bill does not apply to acquisitions by consent. As I've said and will say again, because One Nation has been fighting for this matter—and I know there were some on the government side who disagreed with the compulsory acquisition of the land for the Singaporean army, and I do appreciate their support on this— (Time expired)

Senator O'SULLIVAN (Queensland) (09:52): I rise to make a contribution to the debate on the Lands Acquisition Amendment (Public Purpose) Bill 2017 presented by Senator Hanson. I must say, I have empathy around the arguments made by Senator Hanson with respect to the processes for the compulsory acquisition of land, particularly where those acquisitions affect not just the land of an individual but, in many cases, our constituents in provincial, rural, remote Australia—describe it as you will—for whom this land also happen to be the foundation asset of their businesses, their livelihood.

We've all known of circumstances in which a compulsory acquisition of land has occurred in metropolitan areas for the building of highways, for the development of public utilities generally, for rail lines and for port expansions. An equal degree of anxiety exists amongst the owners of that land, as may be the case particularly with the cited example of the acquisition of land in Central and north Central Queensland. But there is a distinct difference, which I think Senator Hanson has touched on, and that is that these acquisitions can impact on land that is also the primary source of the livelihood of the people who operate that land. In this case it was almost exclusively in areas that were involved in beef production. Being a beef producer myself, I understand the conflict that would confront many of the landowners in this particular case. Unlike with other businesses, the business plans that are developed for many properties have a long intention. It can be a plan to develop your property that might take you 10 to 20 years. In the course of that, there are various stages where you are developing your asset for the purposes of your livelihood, where in effect you are partially through developing the land. At that stage, that may impact negatively on the value of the property as opposed to positively, and Senator Williams would be well aware of the things I'm referring to. You may have purchased a property because it appealed to you, in that it may have had rundown assets and facilities, so you've set about to develop it. In many cases this is the life's work of people. When they come onto a property they may have a 10-year plan to fence it and, in the case of cattle, to replace cattle yards and cattle handling facilities; to improve the waters; and to improve the pasture, which could involve land clearing and pasture production. If you're at the wrong stage in the development phases of your asset, it can have less appeal, might I say, in the marketplace, for others who might not have the same strong will to develop the property.

But it is about connection to the land. Many of the people who are in the grazing and pastoral communities are multigenerational. Many of these properties have been in the hands of their parents or in some other form of family partnership. And so there is an enormous attachment. Their life's work is there, on that land. They may well be in an age bracket or in circumstances that prevent them from starting again. This might not be something that is understood by many in this place, but I can tell you from personal experience that, when you're on the land, if you've undertaken a significant campaign to improve pasture, fence it, put in proper water facilities, reticulating water through a particular area—these are big expansive properties; the greater Canberra city would be the horse paddock. People have put decades into these properties.

I was recently with one of these graziers in Casino, not more than a month ago, and I reminded this pastoralist that we had known each other 35 years ago, when he was a miner in a mining community in Central Queensland and when I was the local detective. He informed me—and I knew it at that time—that he had bought a property in the Marlborough district and was affected by this. He was one of the main protagonists against these acquisitions. He filled me in on the fact that he had been 35 years developing this property, and it was not yet where he wanted it to be. People don't quite understand that, for example, when your cattle become acclimatised to a particular area, if there is massive disruption in their lives—if they're taken to other pasture types, if they're moved, particularly in the coastal areas, to more marginal country—the value of those cattle can be significantly impacted upon.

Senator Williams: They will lose weight.

Senator O'SULLIVAN: They will lose weight, as they precondition them. Sometimes it's actually only their progeny that become acclimatised to the country and perform better. So I do understand this nexus between the people and the land, particularly in rural areas. The genesis of this for Senator Hanson was obviously the issues around Central Queensland and North Queensland. I've got to say—and I'll probably get a call from the headmaster after this—that this was not well managed. Despite the pleas that there had been public consultation and engagement with the communities that were impacted by this, that wasn't 100 per cent correct in all of the cases.

I made the point at the time that, had our government engaged with some of us representatives of government who have an affinity with the people in these regions, we might have made more progress or been able to establish exactly where we were with these communities before this all fell to pieces. Senator Hanson, I understand completely the spirit of the proposal being made here with the amendments in this legislation, but I'm inclined to think—using this as a case study—that we can make all the rules we like around this but, unless culturally the people in the bureaucracy, and in this case the Department of Defence, approach this in a more compassionate manner, we're going to end up with the same set of circumstances again and again, notwithstanding what rules, regulations or framework of operation we put in place.

I think that this was, in large part, a poor effort at the front end of engagement with these communities in these particular cases. I know that Senator Hanson played a very active role, as did a number of us. Fortunately on this occasion the Deputy Prime Minister took an interest in it. Had he been commissioned to take an interest in it at a date sooner than was the case, we might have had some resolution at an earlier time. But the Deputy Prime Minister did visit the area, on 3 February, and had meetings with local people who were affected and, indeed, other stakeholders in the community, not just those who might have been the subject of the acquisition. It is a matter of record that, the following day, the government made the commitment that no-one would be forced to sell their land against their will.

There was a division of thought in the area. There were some landowners who were willing to part with their land, on just terms—if I can make reference to my favourite movie, The Castle. In fact, there were landowners who engaged contractually with the government and did sell their land. So we had the willing sellers. But then equally we had—and I suspect there were more of them—the people that I have mentioned here in this contribution today, the people who had put a lifetime of blood, sweat and tears into their land, who were at some stage within a development program for their property and for whom an acquisition at that time would not have realised the great potential that their property might have had. They might have been wanting to upgrade their circumstances, perhaps because of retirement, and, given some more time, they might have had their land more adequately valued.

A great example of that—I touched on this earlier—is that you might purchase a large area of land that requires 200 kilometres of fencing to be done. No matter how energetic you are, that will take you a long period of time. It will have a serious investment impact from a money quantum point of view. If you haven't started that program or you're early into that program but it is not completed, and your property is valued, it won't matter what value is put on it; only one in 100 buyers will show interest in it. If the program has been finished and all the facilities are upgraded and in a functioning form, you will find that 90 per cent of potential buyers capable of buying that property will be engaged. These are serious challenges. I say to Senator Hanson, we talked about this and explored where there may have been other communities where these facilities could have gone, but I suspect, not knowing, that if the process were not managed properly we would get resistance in those other areas as well.

Central Queensland, and particularly the Shoalwater area, has been devoted to defence activities, but I want to make a point, Senator Hanson: the intent of these acquisitions was to try and get some land where particular operations could occur. This was to do with visibility and engagement. Right next-door to the areas to be acquired, through the barbed wire fence, there were massive tracts of land owned by the defence department—hundreds and hundreds of thousands of acres. But they couldn't clear the land, to make it look like the land through the fence, because of impacts on the environment. It was a most ridiculous situation. We wouldn't even have had to confront these challenges with this community. It will be a long time before society realises just what impact the Greens and their policies, with the support of their coalition partners, Labor, have had in our rural communities. But one day, when people are sitting naked and hungry—

Senator Siewert: You're right! It will take you a long time—a long time to fix your impacts on the environment.

Senator O'SULLIVAN: I can hardly hear myself think, Chair—please provide me with some protection from that shrill noise!

The ACTING DEPUTY PRESIDENT ( Senator Williams ): Interjections are disorderly. Please continue, Senator O'Sullivan.

Senator O'SULLIVAN: Here sit our colleagues in their cotton and their wool, with their leather shoes, sitting on a leather chair, with a timber desk, yet they would resist at every opportunity the ability of people in rural Australia to produce those commodities. As I have said before, Senator Hanson, my friends over here in this little corner have something you and I haven't got.

The ACTING DEPUTY PRESIDENT: Senator O'Sullivan, you are directing your comments to the chair, of course?

Senator O'SULLIVAN: Yes, I am. They have these fairies, Mr Acting Deputy President, with magic knitting needles and as soon as these knitting needles touch they generate all the energy you need for your house and out the end of them, just as we see with spiders and beautiful silk, come cotton and leather and wool—

Senator Dastyari: That sounds awesome!

Senator O'SULLIVAN: It is. If Senator Dastyari were to join the Greens—and I believe membership, depending on which cult part of the Greens you go to, is not very expensive; if you're a bit short, Sam, I'll throw a couple of bob your way.

The ACTING DEPUTY PRESIDENT: Senator O'Sullivan, will you please refer to senators by their correct title.

Senator O'SULLIVAN: My apologies—it was a lapse and I apologise for it, Mr Acting Deputy President. In any event, that was one of the other challenges that occurred up in the Shoalwater Bay area. We had the land. When you can't confront those challenges, when there are other commonsense, practical solutions to these things, the government of the day—it won't matter who is on the leather, it won't matter who's in government, whether it is colleagues on the other side in coalition with the Greens—has to acquire land to broaden highways and byways and to run railways. We are about to embark on that massive generational signature project, Inland Rail—brought on, might I say, very proudly by members of the National Party in coalition with their colleagues; a transformational project that of course has been on the books for so many years but is now being delivered by this government. We will confront these same challenges again on land acquisition.

In closing, my contribution would be that I don't see any problem with calling for a review, and I do not mean some inquiry—I just mean the government of the day has to be involved in these matters. Our government should look carefully at how we go about it. Public engagement, as pointed out by Senator Hanson, is absolutely essential, and, if done properly—these are clever people—they will understand. These are dedicated Australians who understand that, from time to time, there is a need to acquire land as we expand the facilities and infrastructure of our nation, as with Defence's relations with another country. By sitting with them, speaking rationally and hearing what they have to say, we can, on occasion, dismantle some of the concerns that they have and some of the pressures that these things bring into their lives. If they are willing to transition from their land to some other point and if the transactions happen on just terms, as we have heard both in The Castle and in the reading of the Constitution, I don't think we'll be confronted as frequently with the circumstances we found ourselves in around Shoalwater Bay in Central Queensland.

I do support the development of the defence training industry on any terms up in that part of the world. It is a big industry. It employs a lot of people, and billions of dollars are invested in Central Queensland. So there are stakeholders in decisions like this beyond the landowners in Shoalwater Bay, even though, in my view, they are the most important in the consultation process. There are businesses in Townsville, Charters Towers and Rockhampton that rely significantly on the activities around defence training in particular in that part of the world. Given that the Greens and the opposition are determined to shut down the black coal industry in that region of my home state, we need to continue to look at development and investment that will offset and mitigate the impacts of their poor public policy. I agree with the spirit of the amendment. I don't think it's necessary. I think a review of how we approach these things culturally is more important. (Time expired)

Senator FARRELL (South Australia—Deputy Leader of the Opposition in the Senate) (10:12): I rise to speak on the Lands Acquisition Amendment (Public Purpose) Bill 2017, which has been presented to the Senate by Pauline Hanson's One Nation. As Senator O'Sullivan just said, we understand why this bill has been put forward for consideration by the party. It's a reaction to the events that occurred earlier this year surrounding the Department of Defence's flawed process to acquire land to enable the expansion of two training areas in North Queensland—the Townsville Field Training Area and the Shoalwater Bay Training Area.

The department wrote letters to property owners outlining Defence's needs for land and how acquisition of their property, properly compensated, would assist in meeting these needs. The community was of course outraged, as you would understand, Acting Deputy President Williams. Prime agricultural land was being eyed off for military training use, forcing families to leave their land, which, in some cases, had been held by them for generations. After enough pressure from Labor, the Minister for Defence finally stepped in. I think it would be worthwhile commenting on the role of shadow minister Fitzgibbon in this area, because he did some terrific work on behalf of property owners in Queensland to bring the issue into the public arena and put that pressure on the Minister for Defence.

Finally, a statement was made that there would be no compulsory acquisition of properties surrounding the existing training areas. When asked about Defence's processes for land acquisition at estimates in February, the minister's response to a question on notice was:

Compulsory land acquisition was considered as one option during initial planning. It was always the preference to purchase land from willing sellers off the open market, and as announced in February 2017 land will only be purchased from willing sellers.

That was question No. 60 from April 2017. The minister eventually made a decision in this case regarding land acquisition to only acquire land from willing sellers. That avoids the need to consider compulsory acquisition and the public purpose test. It is not clear how the proposed changes to the definition of 'public purpose' would assist in these types of considerations where ministers are required to consider the overall public benefit and purpose in every decision they make.

Senator Hanson, while the defence minister certainly made a mess of the acquisition of land, we do not believe at this stage that the implications of this bill have been thought through. It was introduced yesterday afternoon, and we understand there has not been consultation at this stage with the Australian Government Solicitor and, of course, with a broad range of stakeholders and a broad section of landholders across this country. We are of the belief at this point that those are the sorts of things that ought to occur before a full consideration of this legislation.

There are significant judicial precedents regarding land acquisition. The act that Senator Hanson is seeking to amend is almost 30 years old, and there are a number of precedents of Commonwealth over-reach that have been successfully challenged in the courts. Labor believe we need to be conscious of those precedents which allow the Commonwealth to acquire land where it is necessary and to provide appropriate compensation. This bill would complicate all of those former precedents and, for that reason, at this stage, the Labor Party cannot support this legislation.

Question negatived.

Senator HANSON (Queensland) (10:18): I rise today to speak on this Senate private member's bill, the Criminal Code Amendment (Prohibition of Full Face Coverings in Public Places) Bill 2017. It was only a matter of weeks ago that I actually entered the chamber wearing a burqa, and it was basically to say, 'This is not the place to wear full face coverings, in this chamber.' There are people in this place who are totally against full face coverings and there are also people who are supporting full face coverings on the streets of Australia, based on the fact that they say it is a person's right to wear whatever they wish. In a lot of cases, yes, I do support that and I do agree with that. But, then again, we have societies and cultures that are not reflective, like many other countries around the world that accept seeing women completely covered, in full face coverings, because it's oppressive to them and controlling of women and it is basically saying, 'You cannot be seen out in public with any part of your body, your face'—your face, mind you—'showing, because it is basically putting out a message to men that you're on the meat market.' That's basically what it is saying: 'These men can't control themselves, so you need to cover yourself up so that you are not tempting these men.' Heaven help us if that were ever made compulsory in Australia. We wouldn't have bikinis, we wouldn't have bathing suits, we wouldn't have our lifestyle in Australia. The whole fact is: this is a debate that this country needs to have because that is what the Australian people want.

My reasoning for wearing the burqa into this chamber was seen as a stunt. Call it what you want; I really don't care, because the whole fact is that it has got Australians talking, and Australians feel now they have a voice. It's created debate. But another reason I wore the burqa into this chamber was because there is no dress code for this chamber. When we actually sit down here to vote, the bells ring, we come into the chamber and we sit down. We have people go to either side and they recognise us by our faces as to who is voting and how they are voting. We are crossed off that way. I would love to know what the Greens would do in this matter if you had half-a-dozen people in this chamber wearing burqas. What are you going to say? 'Show your face so we can get your vote'? I don't think so. Because they will not show their face. If everyone's the same, covering their face, how is a vote going to be taken? So I am pleased to know now that it is going to be discussed, debated and brought back to the chamber. I hope that common sense prevails in this chamber. Everyone in this House must agree a full-face covering could never, ever be worn in this chamber purely for that fact. This is the heart of our democracy.

Now, I want to go back to the National Party conference on the weekend. It was quite interesting that it was a close vote—51 to 55 votes. The National Party is, clearly, very divided on this. For Barnaby Joyce, the Deputy Prime Minister of this country, actually came out and said he doesn't support banning of the burqa, and I think he said 'because we have a relationship with Indonesia and Saudi Arabia'. Well, Indonesia basically has the niqab, which is the scarf. They don't sort of promote or have the full-face covering. Saudi Arabia do. They like to control the women and they like to tell the women what to do. Women can't even go out of their house and they can't even leave their premises without having a male with them, even a male child. So they are totally controlled. 'But that's all right; we've got to change our culture and our way of life because we deal with these other countries.' It's not because we have a good product, not because it's at the right price, not because they want everything here in this country; it's because we actually need to appease them. So we are actually in control. And that's where our Deputy Prime Minister's head is at, instead of being a leader. Instead of listening to what they want, how about listening to what the Australian people want?

This is why I hear from so many people that say, 'We don't go to certain areas now,' especially in Sydney. If you look around Lakemba and Bankstown, these areas are no longer Australian. They don't know the person they are walking past in the street. This is so un-Australian. And it has grown more and more. The fact is there are women being paid to wear the burqa. There are people who are pushing their own agenda, their political ideology, which is Islam. And they're using our laws against us. That is what is happening in our country. Full-face covering offends a lot of people. They find it offensive and they find it confronting, as two of our former prime ministers have said—Tony Abbott and Julia Gillard. I find it terribly confronting. When I walked into this chamber here in the burqa, the number of people who got a jolt from it—and they said, 'Oh, it's terrible.' They didn't like it, and that's the fact of the matter. But we bury our true feelings and how we really need to look at the whole fact of where we are headed. We have separate laws in this country for some people and not for others. I hear it all the time from people who have a bike helmet. When they get off their bike there is no way in the wide world they can walk into some government areas or into banks if they have a bike helmet on. There is no way in the wide world they can go in with a balaclava on. So why are there different rules for one and not the other?

Again, are we appeasing the Muslim population in this country that is now growing at a rapid rate? Is it because the Labor Party have 15 lower house seats that are dominated by the Muslim vote? 'Oh, let's look after those people and forget about the rest of Australians and not look at what is logical!' Where do we want to go with this country? Every time someone stands up and says something, you want to shut them down. You want to call them a racist or a bigot without having a clear debate on this. So people feel that they are totally suppressed by this whole debate, this whole argument. It needs to be discussed.

I refer to a book that I have read—and I think it's a very good read—called Now They Call Me Infidel. It's by Nonie Darwish. She grew up in Gaza. Her father was in the military. She said at that time Egypt was a country where they wore Western dress. She moved to America. She has married an American. She has a couple of kids. She says that now, in America, other women that she grew up with are donning the full burqa when they never, ever wore it in Egypt. Now they're doing it in America and they are criticising her because she's accepted the Western way of life. She has been shunned. She has not been treated the same because they are trying to impose the burqa on her to wear. She said, 'This is not what I want my life to be.' She said she has been intimidated by their whole attitude towards her. She goes back to Egypt and she says that it is not the country she grew up in. It is now being heavily dominated by Islam, by Muslims. She said, 'That's not my country.' She can see the same thing happening in America.

We need to realise and understand that this is what is happening here in Australia. We are having things in this country because of their beliefs, their culture. Let me make this quite clear, as everyone talks about it: the burqa full-face covering is not a religious requirement. It does not have to be protected under section 116 of the Australian Constitution. This is an impact on our culture and our way of life, and it is growing quite rapidly. I know that they actually want to take over and form an Islamic state in this country. We are allowing that to happen, without standing up for our values and who we are as a nation.

I will go back to Nonie Darwish. It's not only her. There are other books written by Ayaan Hirsi Ali. She was a Muslim. She was born in Somalia. She ended up in the Dutch parliament. She fought against the Islamisation of the Western countries of the world. She is trying to warn us, and yet no-one wants to take any notice of this. We have seen it happen in other countries around the world. Let me just state this: the burqa has been banned in many countries around the world, even Muslim countries! We've got Congo, Tunisia and Turkey. We've got other countries as well that are not Muslim dominated that have banned the burqa. You have Spain, France and Germany, to name just a few. Why have they banned it? We are so far behind them in so many ways, but we don't look at what is happening around the world to implement it here and change our ways here before we become basket cases like other countries around the world. We have to actually allow the public to have a debate on this. If you're quite happy to have a plebiscite on same-sex marriage, then, if you haven't got the guts to bring in legislation here, I suggest we have a plebiscite and let the people have a say at the next election on whether they want full-face coverings in this country. Common sense tells you to treat everyone equally and the same. If you are not allowed to wear a helmet or even, in some cases, a hat into a bank, then you shouldn't allow full-face coverings and burqas.

Jacqui Lambie wanted to bring in an amendment to the Criminal Code Act for full-face coverings to be banned at times of national terrorist threat to the country. What are you going to do then? That is not going to solve the problem. That's not the way to go with this.

I will tell you something that I hear from the public. You think that it only goes one way and that we are critical of these women who are wearing full-face coverings. I've sat beside these women in doctor's surgeries and I've passed them in shopping centres, and they are rude to Australians. Their comments are rude. Their attitudes stinks. They feel they can say and do whatever they want to; no-one knows who they are because they're hiding under a full-face covering.

It is not a religious requirement. It is a debate that we need to have. We need to make the decision—and it needs to start here in this parliament—to stop full-face coverings, based on the fact that we need facial recognition here. We also need to ensure that they are banned in government buildings. We also need to say that they should not be worn in hospitals. If a nurse who is wearing full-face covering comes up to give you an injection or to do training on you, how do you know who she is—or he? We don't know the gender. So should we allow full-face coverings in hospitals? I don't think so. Why are we allowing full-face coverings for people driving cars? How can you have proper vision if you can't see? And I can tell you that you can't, because I wore one. You're flat out seeing what's going on around you.

Are we that pathetic as a nation that we would give up our values and who we truly are because we're worried about hurting someone's feelings? I've seen a lot of people get their feelings hurt in this country. I'm getting fed up with the fact that we stand up for these Muslim who stand up and protest. We've got the Greens and others who stand up and say, 'Good on you. You've got your rights,' but we forget about the rights of Australians—ordinary citizens—who are howled down. If you oppose the whole situation, if you speak up and have an opinion in this country, you're shut down, because those who are left leaning want to shut you down completely.

I know you're just going to say, 'No, we can't.' I'm sure that if this issue eventually goes to a vote everyone is going to vote against One Nation. We might get support from a couple of members in this house, but I know we won't get anyone from the coalition government, we won't have anyone from the Labor government, we won't have anyone from the Nick Xenophon Team, we won't have anyone from the Greens, and I doubt whether we'll actually get Lambie backing this, and we won't get Hinch.

The ACTING DEPUTY PRESIDENT ( Senator Williams ): I just want to make a point. Refer to those in this and the other place by their correct titles please, Senator Hanson.

Senator HANSON: I do apologise—or Senator Hinch. I'm sure they won't support me on this issue, because I don't believe they have the intestinal fortitude to stand up for what they truly believe and represent the Australian people. If you're going to have some say in this, put up the facts and debate them. Let the people be heard and have their say before we lose our country. The problems that I can see in the future are huge, and they need to be debated now. We need to discuss them now, here on the floor of parliament. Stop burying them. Stop thinking that we don't have a problem out there. As we see more Muslims coming into this country, especially those with full-face coverings, we need this legislation so that we have full facial recognition. They need to assimilate and integrate into our society, which they are not. That is the problem with the whole lot. We are seeing from that they are bringing in their other views with genital mutilation. We've seen the problems that is causing in our hospitals, reversal of these—they're not operations—for these young girls and women. Is this a culture that we really want here?

We think about the Muslims, and people say, 'They're not all bad.' No, they're not, and I totally agree with that. I've spoken to some, a taxi driver, and he said, 'You are so right.' We need to stop the Islamisation of Australia. We do need to ban it. He said, 'I was a Muslim. I am no longer, but my uncles told my father he must murder me because I've left the religion.' So these people are crying out also. There are women out there, I'm sure, who would like to see the burqa banned, then they can discard the garment. Who knows, their men, maybe their fathers, their brothers, their husbands may say, 'Well, you can't come outside the house.' These poor women! We have fought for women's rights in this country. We have fought for women to have the vote. We have fought for women's rights. Yet you're not prepared to stand up and fight for the rights of these women, who are probably made to wear these garments? You men have no idea. It's not going to impact on you. You can do and say whatever you want to do, but what about the women's rights out there? Have you considered that?

Some of these women say, 'I've got no problem with the hijab, the scarf.' That's fair enough; a lot of countries wear it; but let's look at the whole fact. Let the people have their say on this and stop shutting down debate and having a go at people because they might put up some commonsense points about this whole thing. And look at the book. I will say it again if anyone wants to read it: read Now They Call Me Infidelby Nonie Darwish. Or read Ayaan Hirsi Ali's book Infidel. Listen to these women who have been controlled by Islam and are no longer with it. They are trying to warn us. Listen to what they have to say. I commend the bill to the house.

Senator BERNARDI (South Australia) (10:37): I rise to support the Criminal Code Amendment (Prohibition of Full Face Coverings in Public Places) Bill 2017. I'm mindful of some words that were given to me when I first started in the financial markets. An experienced gentleman said, 'In order to preserve your financial balance sheet, you're always better to be six months too early than one day too late.' It has some parallels with this debate about our national security, and particularly, specifically, about the burqa. I first raised this issue in May 2010—more than seven years ago. I didn't find a single supporter in this place. Very few in the public sphere publicly came out and made noise in support of what I said at the time. But it seems that we are getting to a point where people are recognising the prescience of the warnings that were sounded. For the benefit of Hansard, I wrote this on 6 May 2010:

In my mind, the burka has no place in Australian society. I would go as far as to say it is un-Australian. To me, the burka represents the repressive domination of men over women which has no place in our society and compromises some of the most important aspects of human communication.

It also establishes a different set of rules and societal expectations in our hitherto homogenous society.

…   …   …

The same can be said for any number of areas where photographic identification is required. How many of us would ask for the veil to be dropped so we can compare the photo with the burka wearer's face? I suspect the fear of being called bigoted, racist, Islamaphobic or insensitive would prevent many from doing what they would not think twice about under normal circumstances.

…   …   …

Equality of women is one of the key values in our secular society and any culture that believes only women should be covered in such a repressive manner is not consistent with the Australian culture and values …

New arrivals to this country should not come here to recreate the living environment they have just left. They should come here for a better life based on the freedoms and values that have built our great nation.

The burka isolates some Australians from others. Its symbolic barrier is far greater than the measure of cloth it is created from.

For safety and for society, the burka needs to be banned in Australia.

Those words today cause almost no reaction. People will, of course, disagree with them, but they cause almost no reaction because people know they're right. But, at the time, the abuse and the criticism came from all fields. In May 2010, when Mr Kevin Rudd was Prime Minister, it was reported:

Mr Rudd suggested yesterday Senator Bernardi was engaged in ''populist politics''—

well, that's worked pretty well for me so far, so he was wrong there—

and that Australians took a sensible approach to traditional dress.

A sensible approach, Mr Rudd, is not to cover your face while you're walking around the streets of Australia. He went on to say:

'The worst thing we can do is actually start ganging up on particular groups within our country.

No-one is ganging up on anyone. We're saying this is completely inappropriate and it shouldn't be here.

Senator Sarah Hanson-Young has never missed an opportunity to jump on a minority bandwagon. She said:

If people want to start banning items of apparel, perhaps we could start with budgie-smugglers?

May I make this point with respect to that: there are items of clothing that are inappropriate to wear in certain circumstances and, if anyone thinks it's okay to wear budgie smugglers or any other bathing attire into the Senate chamber, for example, they're barking mad. I would say it is the same for anyone who thinks it's okay to turn up in a court of law for a judicial appearance in some bathing attire or budgie smugglers. There is a time and a place for those sorts of things. Society renders those verdicts and expects others to abide by them. But let me tell you, I don't know a time and a place for anyone to walk around with the sack of anonymity over their heads in Australian society. It is a cultural export from the women-hating regime in Saudi Arabia, where they cover their women like chattels and export their extremist ideology to Afghanistan and other Wahhabist Islamic nations. We are in the country of Australia, a homogenous country, a country where we believe in giving people a fair go and you judge someone basically by the smile on their face and the glint in their eye. The burqa prevents that from happening.

Of course, it wasn't just Senator Hanson-Young and Mr Rudd. My old friend Keysar Trad, the guy who was found by a court to be an anti-Semite, a person who incites violence, steers people to jihadi websites and so forth—a really terrible person—said it's 'totally uncalled for to bring these phobias into Australia'. Sticking up for your own culture, sticking up for your way of life is, according to Mr Trad, a phobia, and this is a guy with a track record that I've just outlined. He also tried to take over AFIC and was booted out of that because one set of crooks couldn't get through another set of crooks. These are the sorts of judgements, and the media report these people as being credible.

Western Australian MPs were surveyed: 'A survey of state MPs found all who responded disagreed with a call by Senator Bernardi for burqas to be banned.' So all West Australian MPs disagreed with my call at the time. In September, this was reported:

Muslims Australia president Ikebal Patell said that while the burqa was "confronting", it was nonsense to suggest it was being used as a disguise to commit crimes—

notwithstanding the evidence to the contrary—

to use this as an excuse to ban the burqa, I would like to think Cory Bernardi has asked for helmets, balaclavas and other face coverings to be banned ...

In fact, it's not appropriate for someone to walk down the street with a balaclava on either, unless you're in the ski fields or somewhere like that. If someone walked into this place with a balaclava on, people would be alarmed. It is about a time and a place. If you want to wear your burqa in your backyard or your special fete or something like that, maybe it's appropriate there, but it's not appropriate in Australian society and culture.

Mr Abbott—I was his parliamentary secretary at the time—walked away from it and said they were my personal views rather than coalition policy, but he did acknowledge:

There is understandable concern in the community about what former prime minister John Howard called a 'confronting' form of attire.

It wasn't long after that that the reality hit some of those people. There was a case in the New South Wales police where a woman wearing a burqa, or a niqab, in fact, was pulled over by the police and questioned for not having P-plates and various other things on. She made a number of allegations against the police officer—that he was a rapist, that he had touched her inappropriately and all of these sorts of accusations. Fortunately, for this police officer, he had his dash cam on, and it demonstrated comprehensively that whomever was hiding under that burqa—because they hadn't been identified—wasn't telling the truth. They then sought to prosecute the individual because they had signed a statutory declaration making these allegations against the police. But, of course, the person taking the statutory declaration didn't ask to see the face of the person signing it, so they couldn't verify that it was actually the individual. So the prosecution of the person for making a false statement failed because they had the niqab on and society—and individuals involved—was too scared and too ashamed to ask them to show their face for fear of being called an Islamophobic. Shortly thereafter the New South Wales government, to their credit, changed the law.

We could go on and on and on. There are cases after cases after cases, here and internationally, where people have chosen to hide themselves behind the Islamic veil and refuse to take it off in a court of law, so much so that in Western Australia they were considering allowing people to give their evidence via video because they didn't want to offend them by insisting they show their face in the courtroom. These are the sorts of accommodations we're making for a subsection of the community which is so small, so minor and yet are so inextricably linked to fundamentalist Islam that the burqa could be called the flag of fundamentalism. No moderate Muslim wears the burqa. No secular Muslim wears the burqa. They are fundamentalists.

Every time you see a terror raid—and we saw one, and I tweeted this actually a couple of years ago, once again to much more abuse, when a family was raided for terror offences. Subsequently, one of the individuals was found guilty. We saw a number of people, individuals, walk out with a niqab and their faces covered. And I made the tweet, 'Well, there's the flag of fundamentalism.' If you want to identify where the radical threats are in your society, look for the individual wearing the burqa. Some may say, 'Well, that's good, we should keep it there so we know where the nests of extremism are residing.' But it's worse than that. It sends a message to every Australian, 'I do not want to be part of you.' It says, 'I am unemployable,' because no-one would rightfully give a job to someone who insisted upon hiding their face from everyone else. I can't imagine the circumstances where they were—maybe in a burqa modelling agency or something. I can't imagine.

But this is nonsensical. The defenders of this are the same people who have sold out our culture and our values in so many areas. It is this cultural relativism that if we dismantle what we've got here, which is something precious and something unique, it will all be okay. But by some quirk of fate, Australia has become the best country in the world. We risk dismantling it every time we surrender our values and our principles at the altar of political correctness.

I've only got through 2010 there, of course. I must compliment Senator Cash, who is actually in the chamber, because Senator Cash did say in April of 2011, 'It is inconsistent with our culture and values, and I truly believe that women should not do it.' So congratulations, Senator Cash. But very few other people came out and expressed any support. In fact, they would often lay traps so that when a visiting dignitary would come here they would say, 'Oh, the nutjobs want to ban the burqa,' or words to that effect. 'What do you think about that?' They fronted my old pal Hillary Clinton—I think you will get sarcasm for that. In November of 2010, on the day after my birthday—it must have been a gift from Hillary—an enterprising journalist said, 'The right-wing want to ban the burqa. What do you think about that on security issues?'

She said:

Well I am aware of the difference between a head scarf and a burka and hijab—

most people in this place, aren't, by the way—

and I think that there is a difference. I think that a head scarf is a very appropriate manifestation of a woman's choice, so long as it is her choice, which is a premise of my answer. But I think we have to face the reality that in a society where there is a legitimate threat of terrorism, not being able to see one's face, not being able to have some sense of communication in that way is for many societies a challenge. So I understand the dilemma and I think it is a legitimate dilemma.

So you had the left-wing cheerleader, who is beloved by so many—and I reckon 90 per cent of the people in the Senate and the House of Representatives were cheering her on for President last year; I wasn't one of them—prepared to say, 'Yes, it's inappropriate to have someone's face covered because of the security issues attached to it.' I could go on.

Councils, governments and building owners are spending millions upon millions of dollars on security cameras to identify the people in their area for security reasons alone. Yet if you've got a group of people covering their faces, it doesn't set off any alarm bells. If you saw a bunch of people in motorcycle helmets, you would raise questions. If you saw a bunch of people in balaclavas walking down the street, you would raise questions. But, for some reason, we are meant to suspend belief and reality and say that a bunch of people covering their face in the name of religious piety is okay. It represents exactly the same security threat, perhaps even more so, because it is so irregular in this country. If you can't identify the individual under that facial veil, how do you know which one of them has committed the crime?

It was brought home very starkly here in the parliament. When I was walking through the public gallery there were five or six women wearing niqabs. I went to security and asked, 'Did you ask to check their face when they were coming through?' Their answer was, 'No, we're not allowed to.' I said, 'What if they had balaclavas on?' 'Yes, we'd have to check their face.' The principle is exactly the same, which prompted me to write to the then presiding officers and ask: 'What's the story? Why is it that some people are asked to show their face and others aren't? If one of that group of burqa-clad individuals damaged or defaced one of the paintings, how would you know which one it was when they all look the same?'

These are legitimate questions in this place. It was raised on ABC radio. I raised in 2010-11 that, if we had a vote and we had multiple people here wearing niqabs or burqas, you wouldn't know who it was. That is the exact point that Senator Hanson herself made just the other day. They are very valid and legitimate points. Somehow we're not allowed to have a rational and sensible discussion about it because the snowflakes worry we're going to upset or offend a group of people. Well, I'm over that. I don't care about upsetting or offending a group of people. I get upset and offended because people are prepared to dismantle and destroy our culture, our values and our way of life to indulge the desires of a tiny minority.

It's about time that we confronted the sorts of threats that are in our society. I'm convinced that the reason people wear burqas is to directly challenge us, to say: 'No, I will not conform to your laws. I will not conform to your requirements.' We even had the inane circumstance in South Australia where the then prisons minister said it was okay for women to wear burqas in prison. What sort of mindless, mind-numbing stupidity is that? Fortunately, she lost her seat at the next election. But that's the sort of blinkered understanding or ideology that is behind some of the appeasement processes. Appeasement simply doesn't work. It doesn't work.

Sticking up for your values and defending your principles is what the Australian people want. They want it from this place. They want it from people in their own communities. I regret to say that every time we sweep these things under the rug. People say it is just a racist, Islamophobic rant; it's not. This is about genuine issues—about cultural assimilation and integration, about national security and about the type of country we want to see for ourselves.

I'd hazard a guess that the women of Saudi Arabia and the women of Afghanistan would welcome this sort of debate and discussion in their parliament, because they want to be free of this cloak of anonymity, this flag of fundamentalism, this dehumanising garment that reduces a woman to the property of her husband. That's exactly what it does. Yet the vitriol and the abuse spewed at those of us who are concerned not only about the welfare of the individual but also about the welfare and wellbeing of our nation is extraordinary.

Senator Hanson: Where are the feminists?

Senator BERNARDI: Senator Hanson asks: where are the feminists? That's crickets chirping you can hear, because they're nowhere to be seen. Virginia Haussegger, an ABC News presenter here in Canberra, once made the point that she thought the burqa should be banned, and she remarked to me once that the vitriol and the abuse that she received in response was unbelievable. So why is it that so many in our country are prepared to surrender our rights, our history, our values, our societal expectations and our cultural heritage in favour of several dozen—maybe several hundred or maybe several thousand—people who want to directly challenge it? That is what I cannot come to terms with.

Senator McKim: It's not about telling people how to dress.

Senator BERNARDI: Senator McKim says it's not about telling people how to dress. But the big problem with Senator McKim and his rhetoric is that he's blinded by his own ideology. The big deal here is that Senator McKim is prepared to surrender our values and our culture at the altar of political correctness. He is a sell-out. He is the Neville Chamberlain of the Australian debate: 'Appease everyone, and it will be okay. We can be in some great global environment.'

Senator McKim interjecting—

Senator BERNARDI: What I would suggest to you is that if the Greens voters, led by Senator McKim, decided to go and perch themselves in Afghanistan or Saudi Arabia for a little while, let's see how far their discussion gets. That's the reality of it. We've got to defend our culture. (Time expired)

Senator DASTYARI (New South Wales—Deputy Opposition Whip in the Senate) (10:57): The burqa ban again! I am not going to take up any more of the Senate's important time having this ridiculous debate time and time again. We all get paid a lot of money to be parliamentarians, and we all have a lot of things to do. But I do want to leave with these immortal words that were left by Senator Hanson to us today. Ignore the advice of security agencies and ignore every expert in the field—it's okay, because Senator Hanson got up today and said, 'I spoke to a taxi driver about it once.' Oh, Senator, you met a Muslim in the wild. It must have been an exciting experience!

Debate adjourned.

Senator BUSHBY (Tasmania—Chief Government Whip in the Senate) (10:58): I present the 11th report of 2017 of the Selection of Bills Committee. I seek leave to have the report incorporated in Hansard.

Leave granted.

The report read as follows—

SELECTION OF BILLS COMMITTEE

REPORT NO. 11 OF 2017

1. The committee met in private session on Wednesday, 13 September 2017 at 7.15pm.

2. The committee recommends that—

(a) the provisions of the Crimes Legislation Amendment (Sexual Crimes Against Children and Community Protection Measures) Bill 2017 be referred immediately to the Legal and Constitutional Affairs Legislation Committee for inquiry and report by 16 October 2017 (see appendices 1 and 2 for a statement of reasons for referral);

(b) the provisions of the Criminal Code Amendment (Impersonating a Commonwealth Body) Bill 2017 be referredimmediately to the Legal and Constitutional Affairs Legislation Committee for inquiry and report by 13 November 2017 (see appendix 3 for a statement of reasons for referral);

(c) the provisions of the Migration Amendment (Prohibiting Items in Immigration Detention Facilities) Bill 2017 be referredimmediately to the Legal and Constitutional Affairs Legislation Committee for inquiry and report by 14 November 2017 (see appendix 4 for a statement of reasons for referral);

(d) contingent upon introduction in the Senate, the provisions of the Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 1) Bill 2017 and Superannuation Laws Amendment (Strengthening Trustee Arrangements) Bill 2017 be referredimmediately to the Economics Legislation Committee but was unable to reach agreement on a reporting date (see appendices 5 and 6 for a statement of reasons for referral);

(e) the provisions of the Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 2) Bill 2017 be referredimmediately to the Economics Legislation Committee but was unable to reach agreement on a reporting date (see appendices 7 and 8 for a statement of reasons for referral); and

(f) contingent upon introduction in the Senate, the provisions of the Treasury Laws Amendment (Putting Consumers First—Establishment of the Australian Financial Complaints Authority) Bill 2017 be referredimmediately to the Economics Legislation Committee for inquiry and report by 17 October 2017 (see appendices 9 and 10 for a statement of reasons for referral).

3. The committee recommends that the following bills not be referred to committees:

Australian Grape and Wine Authority Amendment (Wine Australia) Bill 2017

Lands Acquisition Amendment (Public Purpose) Bill 2017

Medicinal Cannabis Legislation Amendment (Securing Patient Access) Bill 2017

Treasury Laws Amendment (Housing Tax Integrity) Bill 2017

Foreign Acquisitions and Takeovers Fees Imposition Amendment (Vacancy Fees) Bill 2017

Treasury Laws Amendment (Reducing Pressure on Housing Affordability Measures No. 1) Bill 2017

First Home Super Saver Tax Bill 2017.

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

Australian Broadcasting Corporation Amendment (Regional Australia) Bill 2017

Clean Energy Finance Corporation Amendment (Carbon Capture and Storage) Bill 2017

Coastal Trading (Revitalising Australian Shipping) Amendment Bill 2017

Corporations Amendment (Crowd-sourced Funding for Proprietary Companies) Bill 2017

Customs Amendment (Anti-Dumping Measures) Bill 2017

Customs Amendment (Safer Cladding) Bill 2017

Customs Amendment (Singapore-Australia Free Trade Agreement Amendment Implementation) Bill 2017

Customs Tariff Amendment (Singapore-Australia Free Trade Agreement Amendment Implementation) Bill 2017

Defence Legislation Amendment (Instrument Making) Bill 2017

Family Assistance and Child Support Legislation Amendment (Protecting Children) Bill 2017

Investigation and Prosecution Measures Bill 2017

Live Animal Export (Slaughter) Prohibition Bill 2017

Parliamentary Business Resources Amendment (Voluntary Opt-out) Bill 2017

Regional Forest Agreements Legislation (Repeal) Bill 2017

Social Services Legislation Amendment (Housing Affordability) Bill 2017

Therapeutic Goods Amendment (2017 Measures No. 1) Bill 2017

Therapeutic Goods (Charges) Amendment Bill 2017

Treasury Laws Amendment (2017 Measures No. 5) Bill 2017

ASIC Supervisory Cost Recovery Levy Amendment Bill 2017

Treasury Laws Amendment (2017 Measures No. 6) Bill 2017.

(David Bushby)

Chair

14 September 2017

Appendix 1

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Crimes Legislation Amendment (Sexual Crimes Against Children and Community Protection Measures) Bill 2017

Reasons for referral/principal issues for consideration:

Investigate how the Bill works to protect vulnerable children and the community from child sex offenders.

Possible submissions or evidence from: Australian Federal Police

Commonwealth Department of Public Prosecutions

Committee to which bill is to be referred:

Senate Legal and Constitutional Affairs Legislation Committee

Possible hearing date(s):

To be determined by Committee

Possible reporting date:

8 November

(signed)

Senator Mitch Fifield

Appendix 2

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill: Crimes Legislation Amendment (Sexual Crimes Against Children and Community Protection Measures) Bill 2017

Reasons for referral/principal issues for consideration:

This bill deals with the protection of children from the dangers of child sexual abuse. The bill targets all aspects of the child sex offender cycle from the commission of an offence, to bail, sentencing and post-imprisonment.

Given the importance of the subject matter, the complexity of some of the bill's provisions and the broad scope of the bill, it would be appropriate to refer the Bill to committee for consideration.

Possible submissions or evidence from:

Attorney-General's Department, CDPP, Office of the eSafety Commissioner, the Australian Federal Police, Law Council of Australia, State and Territory Law Associations (e.g. Law Institute of Victoria), State and Territory Bar Associations, Australian Criminal Intelligence Commission, Alannah and Madeline Foundation, State and Territory police forces, Australian Institute of Health and Welfare, State, Territory and Federal Government Departments responsible for child protection, major internet service providers (e.g. Telstra, Optus, iiNet, Internode, TPG Internet)

Committee to which bill is to be referred:

Senate Standing Committees on Legal and Constitutional Affairs Legislation Committee

Possible hearing date(s):

To be determined by the committee

Possible reporting date:

16 October 2017

(signed)

Senator Anne Urquhart

Appendix 3

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill: Criminal Code Amendment (Impersonating a Commonwealth Body) Bill 2017 Reasons for referral/principal issues for consideration:

This is legislation which proposes changes to the criminal law. The criminal law has a significant impact on the rights and obligations of the Australian people, including potentially the ability to see them deprived of their liberty.

It is appropriate and responsible for the Senate to properly examine the impact of proposed criminal laws.

Possible submissions or evidence from:

Attorney-General's Department

Australian Federal Police

Commonwealth Director of Public Prosecutions

Australian Human Rights Commission

Law Council of Australia

Committee to which bill is to be referred:

Senate Legal & Constitutional Affairs Legislation Committee

Possible hearing date(s):

N/A

Possible reporting date:

13 November 2017

(signed)

Senator Anne Urquhart

Appendix 4

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill: Migration Amendment (Prohibiting Items in Immigration Detention Facilities) Bill 2017

Reasons for referral/principal issues for consideration:

The Migration Amendment (Prohibiting Items in Immigration Detention Facilities) Bill 2017 (the Bill) amends the Migration Act 1958 (Migration Act) to allow the Minister to determine a thing as prohibited. This a significant change to the operation of Immigration Detention Centres. There is a level of concern among stakeholders about the proposed amendments that suggests that further examination of the bill is necessary.

Possible submissions or evidence from:

Refugee Council of Australia, Refugee Legal, Asylum Seeker Resource Centre

Committee to which bill is to be referred:

Legal & Constitutional Affairs Legislation Committee

Possible hearing date(s):

Possible reporting date:

14th November 2017

(signed)

Senator Rachel Siewert

Appendix 5

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 1) Bill 2017; and

Superannuation Laws Amendment (Strengthening Trustee Arrangements) Bill 2017

Reasons for referral/principal issues for consideration:

Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 1) Bill 2017

- Investigate how the Bill will work to protect superannuation members' money and interests through a strong, transparent and more accountable superannuation system with a strong prudential regulator

Superannuation Laws Amendment (Strengthening Trustee Arrangements) Bill 2017 Investigate how the Bill will work to strengthen the superannuation system and improve conflict management across all superannuation funds

Superannuation Laws Amendment (Strengthening Trustee Arrangements) Bill 2017 was considered by the Senate Economics Legislation Committee in the last Parliament over a period of approximately seven weeks. The name of the Bill in the last parliament was Superannuation Legislation Amendment (Trustee Governance) 8111 2015.

Possible submissions or evidence from:

The Committee should be granted access to evidence provided during the previous inquiry conducted in the 44th Parliament.

Possible submitters could include:

- Superannuation industry participants including associations and individual superannuation funds

Consumer representatives

Corporate Governance and legal experts

- Trade unions

Employer associations

Small and large business associations

Committee to which bill is to be referred: Senate Economics Legislation Committee

Possible hearing date(s):

To be determined by the Committee

Possible reporting date:

4 October 2017

(signed)

Senator Mitch Fifield

Appendix 6

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bills:

Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 1) Bill 2017

Superannuation Laws Amendment (Strengthening Trustee Arrangements) Bill 2017

Reasons for referral/principal issues for consideration: Detailed scrutiny of the provisions of the Bill and their implications

Possible submissions or evidence from:

Industry and community stakeholders, relevant government departments

Committee to which bill is to be referred:

Senate Economics Legislation Committee

Possible hearing date(s):

TBD by Committee

Possible reporting date: 27 November 2017

(signed)

Senator Anne Urquhart

Appendix 7

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 2) Bill 2017

Reasons for referral/principal issues for consideration:

Investigate how the Bill will operate to enable an additional one million people to choose their own superannuation fund; and how it will ensure that workers who make salary sacrifice contributions to superannuation are not short-changed and receive their full superannuation guarantee entitlements

Possible submissions or evidence from:

Superannuation industry participants including associations and individual superannuation

funds

Consumer representatives

Trade unions

Employer associations

Small and large business associations

Committee to which bill is to be referred:

Senate Economics Legislation Committee

Possible hearing date(s):

To be determined by the Committee

Possible reporting date(s):

11 October 2017

(signed)

Senator Mitch Fifield

Appendix 8

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 2) Bill 2017

Reasons for referral/principal issues for consideration: Detailed scrutiny of the provisions of the Bill and their implications

Possible submissions or evidence from:

Industry and community stakeholders, relevant government departments

Committee to which bill is to be referred:

Senate Economics Legislation Committee

Possible hearing date(s):

TBD by Committee

Possible reporting date:

27 November 2017

(signed)

Senator Anne Urquhart

Appendix 9

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Treasury Laws Amendment (Putting Consumers First - Establishment of the Australian Financial Complaints Authority) Bill 2017

Reasons for referral/principal issues for consideration:

Investigate how the Bill will improve access to redress, for both consumers and small businesses, in respect of their disputes with financial institutions.

Possible submissions or evidence from:

Financial Ombudsman Services

Superannuation Complaints Tribunal

Credit and Investment Ombudsman

Australian Small Business and Family Enterprise Ombudsman

ASIC

Consumer Action Law Centre, and associated entities.

CHOICE

Committee to which bill is to be referred:

Senate Economics Legislation Committee

Possible hearing date(s):

To be determined by the Committee

Possible reporting date:

1 November 2017

(signed)

Senator Mitch Fifield

Appendix 10

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Treasury Laws Amendment (Putting Consumers First — Establishment of the Australian Financial Complaints Authority) Bill 2017

Reasons for referral/principal issues for consideration:

Detailed scrutiny of the provisions of the Bill and their implications

Possible submissions or evidence from:

Consumer groups, industry and community stakeholders, relevant agencies and organisations

Committee to which bill is to be referred:

Senate Economics Legislation Committee

Possible hearing date(s):

TBD by Committee

Possible reporting date:

17 October 2017

(signed)

Senator Anne Urquhart

Senator BUSHBY: I move:

That the report be adopted.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (10:58): I move the following amendment:

At the end of the motion, add "and, in respect of:

(a) the Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 1) Bill 2017 and the Superannuation Laws Amendment (Strengthening Trustee Arrangements) Bill 2017; and

(b) the Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 2) Bill 2017, the Economics Legislation Committee report by 23 October 2017".

Senator GALLAGHER: I move an amendment to Senator Fifield's amendment:

   Omit "23 October 2017", substitute "27 November 2017".

This amendment would simply extend the reporting date from 23 October 2017 to 27 November 2017. There has been a similar amendment circulated in the chamber with the actual date, but I acknowledge that this is now an amendment to Minister Fifield's amendment. The simple argument on this is that this is a significant package of bills. The Economics Legislation Committee is a busy committee. These are contested changes; we already know that. There will be the need for hearings and submissions for these bills. We believe that a November reporting date is a much more realistic timetable for inquiry into these superannuation bills and report back to the Senate. I hope the Senate can support my amendment.

The DEPUTY PRESIDENT: The question is that the amendment, as moved by Senator Gallagher, to Senator Fifield's amendment be agreed to.

The DEPUTY PRESIDENT : (11:08) The question is that the amendment, as moved by Senator Fifield, be agreed to.

Question agreed to.

Senator GALLAGHER (Australian Capital Territory—Manager of Opposition Business in the Senate) (11:09): by leave—I move:

At the end of the motion, add, "and, in respect of the Customs Amendment (Anti-Dumping Measures) Bill 2017, the provisions of the bill be referred immediately to the Economics Legislation Committee for inquiry and report by 6 October 2017."

Question agreed to.

Original question, as amended, agreed to.

Senator McGRATH (Queensland—Assistant Minister to the Prime Minister) (11:13): At the request of the Minister for Finance, Senator Cormann, I move:

That the following bills be introduced:

A Bill for an Act to amend the law relating to superannuation, and for related purposes.

A Bill for an Act to amend the law in relation to superannuation, and for related purposes.

Question agreed to.

Senator McGRATH: I present the bills and move:

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

Question agreed to.

Bills read a first time.

Senator McGRATH (Queensland—Assistant Minister to the Prime Minister) (11:15): I table the explanatory memoranda and I move:

That these bills be now read a second time.

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

Leave granted.

The speeches read as follows—

TREASURY LAWS AMENDMENT (IMPROVING ACCOUNTABILITY AND MEMBER OUTCOMES IN SUPERANNUATION MEASURES NO. 1) BILL 2017

This bill amends the Corporations Act 2001, the Superannuation Industry (Supervision) Act 1993, and the Financial Sector (Collection of Data) Act 2001 to give every day Australians more power over their superannuation providers and a stronger prudential framework to deliver a more transparent and accountable compulsory retirement savings system.

The measures in this bill are part of a broader package of Government reforms that are squarely focused on protecting members' money and members' interests.

It is a comprehensive package that will help deliver all Australians a strong and modern superannuation system with a stronger prudential regulator that is solely focused on delivering outcomes for all Australians who rely on these funds to secure their retirement.

2017 marks 25 years since the introduction of compulsory superannuation in Australia. In that time, the system has grown from around $136 billion in 1992 to over $2.3 trillion today. APRA regulated superannuation funds manage around $1.4 trillion of the hard earned deferred wages on behalf of Australian workers.

The Turnbull Government believes that given the compulsory nature of superannuation, Australians rightly expect the industry to be held to the highest standards of transparency and accountability.

The reforms in this bill and the broader package of member-focused reforms will ensure the superannuation system has a strong foundation today and into the future.

Australia's compulsory superannuation system must at all times prioritise the financial interests of members above vested interests in the industry whether government, bank executives, shareholders, directors, employers or trade unions. And, the legislative and regulatory framework underpinning the system must facilitate this in practice.

Many of the measures in this bill have been recommended by past reviews into superannuation, commissioned by both Coalition and Labor governments. These are sensible reforms that are already being embedded in the practices of high performing funds.

The package has been broadly welcomed by industry and consumers groups alike. CHOICE Head of Campaigns and Policy, Erin Turner said, "the superannuation system needs a shake-up and it's why we welcome the Federal Government's announcement that it's taking a consumer-first approach to reform."

Outcomes test

Under the law, MySuper is defined as a simple, standardised 'no frills' superannuation product with regulated fees. Individuals who do not actively choose their own fund or investment option must be defaulted into a MySuper product.

This means that typically, MySuper members are younger and not proactively engaging with their superannuation. For this reason trustees of MySuper products are subject to additional obligations, including the need to ensure that they promote the financial interests of members.

The current law includes a 'scale test' under which MySuper trustees must consider whether a fund has sufficient size to operate efficiently. This bill will replace the 'scale test' with a broader 'outcomes test'.

It will strengthen all default MySuper products offered by superannuation funds across the industry as at June 2016 including:

46 MySuper products offered by retail funds;

43 MySuper products offered by industry funds;

15 MySuper products offered by corporate funds; and

11 MySuper products offered by public sector funds.

It will achieve this by introducing a requirement for trustees to undertake a stronger, broader annual assessment of their MySuper product outcomes to ensure they are promoting the financial interests of MySuper members with almost 15 million accounts across the system.

Under the new outcomes test, trustees will have to consider all aspects of their MySuper offering for example consideration will need to be given to ensuring returns, fees, investment and insurance strategies – including whether insurance premiums are inappropriately eroding retirement savings – as well as the scale of the fund promote the financial interests of members.

They will also have to compare the performance of their MySuper offering with other comparable MySuper products. Trustees will have to do this annually.

Importantly, to ensure the new outcomes test delivers greater transparency, trustees will also be required to publicly release their determination of whether or not they are promoting the financial interests of members and a summary of the assessment and comparisons that lead to the determination.

These changes will ensure that trustees, who have a fiduciary obligation to regularly assess the quality of their MySuper offering; the findings are transparent and address any weaknesses that they identify.

To be clear, the 'outcomes test' will not weaken or lessen a trustee's primary obligation to promote the financial interests of their MySuper members, including through net returns -it will strengthen it.

The new outcomes test will also enhance APRA's ability to assess how trustees are working to improve the quality of MySuper products and meeting their stated strategic objectives. It will also give APRA stronger grounds for engagement with trustees where it has concerns.

Outside of MySuper, there are a diversity of products that are not subject to standardisation under the law. A member who has made an active choice about their superannuation product typically chooses their investment strategy on the advice of their financial adviser. These are referred to as 'choice members'.

During consultation, some stakeholders said that the outcomes test should be extended to all superannuation choice products, not just default MySuper products. There are fundamental legal differences between the default MySuper sector and the 'choice' sector.

On 11 August this year, APRA wrote to all RSE licensees to advise that it intends to consult on a proposal to apply an outcomes test to all products, not just default MySuper products. As with the MySuper outcomes test, this would include consideration of net investment returns, expenses and costs, insurance, and other benefits and services provided to choice members.

The Government believes this is an efficient means through which the choice sector can be strengthened for the benefit of members and agrees with APRA's proposal and expects it to be implemented.

This will ensure that quality outcomes are being delivered and the financial interests of all members are promoted across all superannuation products.

MySuper Authorisation

There are currently 115 MySuper products on the market today. These MySuper products offer a wide range of returns and charge a wide range of fees. As a result, there are concerns that the current MySuper authorisation process is not ensuring that all MySuper products are of sufficient quality.

This bill will amend the law to give APRA more discretion over the authorisation and cancellation of authority to offer a MySuper product.

Given the additional obligations that apply to MySuper trustees, we want to ensure that APRA will only authorise a trustee if it has confidence they are likely to comply with these obligations.

We also want to ensure that APRA has the power to cancel a trustee's authorisation if it has reason to believe that the trustee will no longer comply with their obligations.

These changes to the MySuper authorisation process will give APRA the power to protect the interests of the millions of disengaged members, or members who have not made an active choice about how their savings are invested.

Direction Powers

In a compulsory system of the size and significance of our superannuation system, it is critical that the prudential regulator has a strong regulatory toolkit to protect the interests of fund members.

To date, APRA has largely had to rely on powers of 'moral-suasion' to protect the interests of superannuation fund members.

The Government believes that in order to ensure confidence in the system, APRA should have the capacity to take quick and decisive action to safeguard members' interests where it has significant concerns about a fund's operation.

It also needs appropriate powers to step in and ensure that trustees are meeting their fiduciary obligations.

A strong regulator is crucial for ensuring confidence in the $2.3 trillion superannuation system.

This bill will give APRA the ability to take preventative or corrective action where it has prudential concerns about a superannuation fund or if it is concerned that a fund is not acting in the best interests of members.

For example, if APRA were to have serious concerns with the operations of a subsidiary company wholly owned by a superannuation fund that provides services to members, APRA can direct the subsidiary entity to undertake a particular course of action to protect members' interests.

Similarly, if APRA were to have serious concerns about the actions of a particular trustee director which could impact member outcomes, these directions powers will enable APRA to intervene and direct the board to remove a trustee director.

This is clearly in the best interests of fund members.

Ownership and Control

This bill will also give APRA the power to reject a change in the ownership of a corporate trustee.

Sadly, we can still remember the collapse of Trio Capital in 2009 and the significant impact it had on the lives of many Australians, including thousands of members of APRA-regulated superannuation funds. The collapse of Trio Capital, described as the largest superannuation fraud in Australian history, highlighted the consequences of not having appropriate people in control of superannuation savings.

That is why, given the potential detrimental outcomes that may arise through the mismanagement of funds, we believe that no one should be able to own or control a trustee without APRA's approval.

Director Penalties

This bill will also strengthen the accountability of trustee directors by making them subject to civil and criminal penalties for breaches of their fiduciary duties.

This was a recommendation of the Financial System Inquiry which the Government accepted in 2015.

It is anomalous that trustees do not currently face civil or criminal penalties for breaching their duties.

These penalties include a maximum five years' jail for serious criminal conduct, for example, fraud; and up to $420,000 in civil penalties per director.

Annual Member Meetings

The law today imposes no legal requirement upon funds, who are the custodians of members' compulsory retirement savings to be subject to questioning from members about how their money is invested, the performance of the fund, how their money is spent on marketing or sponsorships.

We believe that it is time for this to change. And we are not alone. Australian Institute of Superannuation Trustees, Eva Scheerlinck has said, "Providing a means for members to engage with the people managing their hard earned superannuation is a good way to identify those issues which are of most interest to members."

As such, this bill will require trustees to hold annual member meetings where members have the opportunity to ask questions and get answers, not just of trustees but also of fund executives, auditors and actuaries.

To provide flexibility and minimise compliance costs, trustees will have the option to hold annual members' meetings electronically.

Annual General Meetings are a longstanding feature of Australia's publically listed companies in which superannuation funds invest their members' money.

Reporting Standards

A compulsory superannuation system must be transparent and accountable for the way in which it spends members' money.

APRA currently has the power to make reporting standards to capture fund expenses relating to investments more granular and transparent. However, it is unable to require funds to report the same detailed information about other expenses including for example, detailed information about financial arrangements with related parties, sponsorships, marketing and other expenditure.

All fund expenses ultimately impact their members' eventual retirement income and all expenses should be required to be transparently disclosed.

As such, the measures in this bill will enable APRA to make reporting standards that require funds to provide detailed expense information in relation to their operations and management.

This will introduce much needed transparency and give members and the regulator much fuller understanding of how funds are spending members' money and whether this is consistent with their fiduciary obligation to act in the best interests of members.

Sally Loane, the CEO of the Financial Services Council, welcomed the package of reforms and in particular, noted that, "The FSC strongly supports all proposals which give consumers more power and greater transparency over one of their most important assets – their superannuation savings."

Portfolio Holdings Disclosure

Finally, this bill will also boost transparency by giving members more information about fund investments. These changes will also improve confidence in the system by ensuring members can see where their funds are being invested and that they are being invested in their best interests.

It will do this by introducing a workable arrangement for portfolio holdings disclosure.

Under the changes in this bill, funds will be required to disclose portfolio holdings in respect to assets held directly and through associated entities, including initial investments made into non-associated entities.

This approach will significantly reduce the complexity of the current law – which was introduced by the former Labor Government in 2012 but has never commenced operation.

Australia's superannuation system is often regarded as one of the world's leading retirement savings systems. However, out of 25 markets surveyed by international market financial analysts Morningstar, Australia is the only one that has not implemented some form of portfolio holdings disclosure.

The portfolio holdings disclosure measure in this bill will ensure Australia's superannuation system remains consistent with international best practice.

Conclusion

Once again I want to make it clear that Government is focused on ensuring Australia's superannuation system delivers outcomes for members first and foremost rather than protecting the vested interests of the industry.

That is, a system that encourages people to participate actively, that ensures transparency to facilitate informed decisions, and one that gives people the confidence that their retirement savings are invested wisely.

And, most importantly, we must have a superannuation system with a strong regulatory framework that protects members' money and members' interests.

I'm confident the measures in this bill will achieve these outcomes.

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

SUPERANNUATION LAWS AMENDMENT (STRENGTHENING TRUSTEE ARRANGEMENTS) BILL 2017

This bill amends the Superannuation Industry (Supervision) Act1993 to modernise and strengthen the foundations of Australia's compulsory superannuation system.

It achieves this by introducing a strong and consistent definition of independence and a consistent minimum legal requirement for at least one third independent directors with an independent chair, across all superannuation funds regulated by the Australian Prudential Regulation Authority (APRA).

This bill is part of a broader package of Government reforms that are squarely focused on protecting members' money and members' interests. These are important changes that will ensure all Australians, regardless of the fund they are in, can have confidence that the people entrusted to manage their hard-earned wages have the appropriate mix of skills and expertise to protect and grow their retirement savings solely in the interests of members.

This bill also amends the Governance of Australian Government Superannuation Schemes Act 2011 to ensure that the Australian Government's main civilian and military superannuation schemes are also subject to the same high standards through complying with the new independence requirements.

It has been a quarter of a century since the introduction of compulsory superannuation in Australia. In that time, the size and significance of the system has changed enormously – both for individuals and the economy more broadly.

For individuals, superannuation is now most Australians' second largest asset after the family home. The total size of funds under management has grown from around $136 billion in 1992 to over $2.3 trillion today – in excess of a 1,500% percent increase over that time. Incredibly, that figure is projected to double to $4 trillion in just over a decade.

Make no mistake about it, Australia's superannuation system has grown into what it is today largely by virtue of successive government policy to compel individuals to defer a portion of their wages – today, 9.5% - for their future retirement income.

It is always important to remind ourselves that this money is the property of each and every hard working Australian superannuation fund member. Not the government; not the industry; not the bank executives; not the shareholders; not the employers; and not the trade unions.

During the past 25 years the nature of the superannuation industry and the funds themselves has changed markedly.

Superannuation funds regulated by APRA now hold around $1.4 trillion in assets on behalf of the hard working Australian people.

Significant industry consolidation has occurred and funds have grown much larger and more complex. It is appropriate that the foundations underpinning the system are updated to reflect this change.

The previous Labor Government commissioned a 'Super System Review' that considered the governance arrangements in the superannuation system. This review, led by Jeremy Cooper recommended that, at the very least, equal representation trustee boards should have a minimum one-third 'non‑associated' directors, although a requirement for a majority of independent directors was preferred.

In forming this recommendation, the Panel noted in its Final Report that, "it had come to the view that changes in the industry over time and certain implementation practices mean that equal representation no longer seems to achieve its original stated objective."

The Cooper Review Panel made the case for its recommendation on the basis of a number of key structural changes that have taken place in the system since the equal representation governance structure was established in the SIS Act in 1993.

These included:

1. The substantial shift away from single-employer defined benefit funds that were dominant in 1993 and the introduction of fund choice and prevalence of defined contribution schemes. This materially changed, and in many cases, severed the once close relationship between an employer and super fund.

2. The fact that most 'employer' and 'employee' representatives are nominated by third party organisations such as employer associations and trade unions.

It noted the implications of this included the perception of democracy that equal representation appears to embed is not always the reality.

Further, it creates at least the perception that individual directors are required to answer to, or are dictated to by, the organisation that appointed them.

3. The potential for the large numbers of employer and employee organisations with interests in a fund can lead to larger than necessary board sizes.

4. Equal representation leaves significant groups 'unrepresented'. In particular, it highlighted pensioners, future post-retirement members and members' who have exercised choice.

The most recent Intergenerational Report, published in 2015 bears this out showing that by 2055, the number of Australians aged 65 and over is projected to more than double.

There is a further compelling argument for the need to introduce a minimum requirement for independent directors on superannuation fund boards – that is to ensure a board can be comprised of a sufficiently diverse, skilled and experienced set of directors.

There can be no argument that members of superannuation funds, the hardworking Australian people, deserve the best and brightest minds sitting around the board tables of Australia's superannuation funds.

A second review, the 2014 Financial System Inquiry led by David Murray, initiated under a Coalition Government, agreed that there should be a change to the governance arrangements that apply to the superannuation industry.

However, the FSI recommended that all public offer funds should have a majority of independent directors, including an independent chair.

While the Government agrees with both of these review findings, that a majority of independent directors would be preferable, we recognise that having a consistent minimum standard of one-third independent directors on trustee boards represents an important step forward and is better than continuing with none.

Some for-profit retail funds, that do not follow the equal representation model under the law, comply with a Financial Services Council industry standard requiring its members to have a majority of independent directors and an independent chair.

The not for profit sector has also developed a governance code. Some might suggest that this means there is no need for this legislation.

However, there is no guarantee every participant in the system will be covered. Treasury analysis suggests that in 2016, the percentage of funds not covered by any industry body was 44 per cent.

The Government believes that all superannuation members have a right to expect high standards of governance, enshrined in the law, including independent thinking and judgement that is free from conflict of interest underpinning how their money is managed.

To ensure the bill delivers on its objective, it empowers APRA to make determinations about whether a person satisfies the new definition of independence.

A trustee will be able to apply to APRA for a determination that a potential director is able to exercise independent judgement if they may not meet the strict definition in the law.

This bill provides a three-year transitional period for trustee boards to have at least one-third independent directors.

It will also ensure that the new requirements are enforceable by APRA.

At its heart, the case for a consistent minimum standard across all types of superannuation fund boards for independent directors is simple.

Independent directors will strengthen corporate governance in the superannuation sector, especially in relation to conflicts management, and related party transactions including, choice of investments, arrangements with service providers, directors' fees, sponsorships, marketing activities, advertising and payments to nominating bodies.

The proposed requirements for independent trustee directors are less than what some industry superannuation funds themselves expect of the entities in which they invest members' money.

For example, the Governance Guidelines of the Australian Council of Superannuation Investors highlight the importance of company directors exercising independent judgement, not just in relation to management but also into relation to related parties and other affiliates.

Under this bill, it will be a matter for trustees to determine how the remaining two‑thirds of the board is comprised.

Boards will be able to choose to have the remaining directors split between sponsoring organisation representatives if they consider it appropriate.

It will ensure our compulsory superannuation system is well-equipped for the next quarter of a century and beyond.

This bill does not favour one part of the industry over another – it applies equally to industry funds, corporate funds, retail funds and public sector funds.

It is about lifting governance standards across the entire industry in the interests of members.

Members of all funds deserve to have their interests placed first.

This bill will help to ensure that this happens in future.

There is too much at stake to allow these sensible reforms to be delayed by industry self-interest any longer.

Full details about the amendments are contained in the explanatory memorandum.

Ordered that further consideration of the second reading of these bills be adjourned to the first sitting day of the next period of sittings, in accordance with standing order 111.

Senator McGRATH (Queensland—Assistant Minister to the Prime Minister) (11:15): At the request of the Minister for Finance, Senator Cormann, I move:

That the following bill be introduced: A Bill for an Act to amend the Corporations Act 2001and repeal the Superannuation (Resolution of Complaints) Act 1993, and for related purposes.

Question agreed to.

Senator McGRATH: I present the bill and move:

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

Question agreed to.

Bill read a first time.

Senator McGRATH (Queensland—Assistant Minister to the Prime Minister) (11:16): I present the explanatory memorandum and 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 Corporations Act 2001 and other related legislation to radically overhaul the financial system dispute resolution framework by establishing a new one-stop-shop dispute resolution body — the Australian Financial Complaints Authority — to ensure that consumers and small businesses have access to free, fast and binding dispute resolution.

The bill forms part of the Government' s broader commitment to ensuring that the banks and other financial institutions are held to account when they fail to meet community expectations.

The financial sector plays a vital role in the Australian economy by meeting the needs of its users, including consumers and small businesses.

Its role in the economy and the lives of all Australians continues to grow and evolve.

Given the crucial role of the financial sector, Australians expect high standards from financial institutions.

Where these expectations are not met and consumers wrongfully suffer a loss, it is critical that those who have been wronged have access to redress in a timely manner.

External dispute resolution (EDR) plays a critical role in providing consumers and small businesses with access to an alternative, out-of-court, dispute resolution service, to hear and determine their complaints about financial firms.

The Government is committed to having a world class financial dispute resolution system.

That is why in April 2016 the Government commissioned an independent comprehensive review of the dispute resolution framework (the Ramsay Review), which was led by an expert panel comprising Professor Ian Ramsay, Julie Abramson and Alan Kirkland.

The Ramsay Review undertook a rigorous consultation process and received 187 submissions in response to its Issues Paper and Interim Report.

The Ramsay Review found that the current dispute resolution framework is a product of history rather than design and, in significant areas, reform is needed.

The Review made eleven recommendations to strengthen and future-proof the dispute resolution framework, all of which the Government has accepted.

The Review' s central recommendation was to establish a new one-stop-shop dispute resolution body for all financial disputes, including superannuation disputes.

In line with this recommendation, the Government committed to establishing the Australian Financial Complaints Authority, or AFCA, which will be based on an industry ombudsman model, with additional statutory powers where required.

This approach combines the strengths of both a statutory tribunal and an industry ombudsman scheme.

AFCA will replace the Financial Ombudsman Service (FOS), the Credit and Investments Ombudsman (CIO) and the Superannuation Complaints Tribunal (SCT), and will reduce the unnecessary duplication and consumer confusion that has been characteristic of the current framework.

This simplification of the system has been welcomed by Gerard Brody, CEO of Consumer Action Law Centre who has commented that "Currently if you have a problem with a bank or finance provider, it is incredibly confusing to fix the problem. The people who call our services just want to get their lives back on track – the Government can help them by simplifying the system and giving it teeth."

Choice likewise welcomed the announcement of AFCA, stating "it will provide consumers with a single, accessible complaints resolution service when something goes wrong".

AFCA will have higher monetary limits and compensation caps than those of FOS and CIO, and will maintain the SCT' s unlimited monetary jurisdiction for superannuation complaints. The new monetary limits and compensation caps are double and, in the case of small business credit facility disputes, almost triple the limits and caps currently in place. This will significantly improve access to justice for consumers and small businesses.

The creation of AFCA will also address recommendations of the House of Representatives Standing Committee on Economics' Review of the four major banks (also known as the Coleman Report) and the Carnell Inquiry into small business loans.

The Coleman Report recommended that the Government replace the three existing EDR schemes with a ' one stop' Banking and Financial Services Tribunal. The report noted that it would: reduce confusion for consumers; enhance small businesses' EDR scheme coverage; help ensure consistent outcomes for complainants; and eliminate unnecessary duplication. The AFCA will fulfil all of these requirements.

The Carnell Report likewise recommended the establishment of an industry funded external dispute resolution one-stop-shop with appropriate small business expertise to hear disputes relating to credit facilities of up to $5 million. The AFCA will meet this recommendation by significantly expanding small business access to redress, through monetary limits and compensation caps that are almost triple the existing limits and caps.

Small Business has welcomed the establishment of AFCA. Peter Strong, CEO of the Council of Small Business Australia (COSBOA) commented that "too often, small business owners are shafted by the actions of big banks and these business owners have little option but to take their medicine in the face of the overwhelming power of the big banks. But this new Authority will provide business owners with a clear mechanism to seek redress where they have been unfairly done by".

The bill introduces a new legislative framework which sets out the standards that AFCA must adhere to.

Under the legislative framework, AFCA will be accessible to consumers and small businesses, who will be able to have their disputes with financial firms heard and determined by AFCA for free.

All financial firms, including superannuation funds, will be required by law to be members of AFCA.

AFCA will be a not-for-profit company governed by a board comprised of an independent chair and equal numbers of directors with industry and consumer backgrounds. It will be funded by industry.

The legislation will ensure that AFCA will provide fair, efficient, timely and independent dispute resolution services and that it has the relevant expertise to resolve the disputes it hears.

The legislation also includes a number of statutory provisions to ensure that AFCA has the necessary powers to effectively resolve superannuation disputes. Additional statutory provisions are required because of the complex nature of some superannuation disputes that involve third parties, such as death benefit disputes.

AFCA will have the power to join third parties to a dispute, require parties to attend conciliation and require the production of documents.

The statutory provisions available to AFCA will allow timely decisions to be made, to enable prompt payment of death benefit amounts by superannuation funds, to those who may be in need.

The framework does not dictate the way in which AFCA should deal with complaints. This will enable AFCA to adapt to change and to be flexible and innovative in its approach to resolving disputes.

To ensure that AFCA meets community expectations for free, fast and binding dispute resolution, it will be subject to a comprehensive accountability regime.

First, the AFCA scheme will be authorised by the Government. The responsible Minister will not authorise the AFCA scheme unless satisfied that it has robust systems and processes to meet community expectations and the rigorous standards set out in the legislation. And where the scheme, once authorised, fails to meet these standards, the Minister will have the ability to revoke authorisation.

In addition, the responsible Minister will have the ability to impose conditions on authorisation. This ability to set conditions will allow the Government to ensure that AFCA is accountable to both consumers and member firms, for example, through specifying the frequency of independent reviews of the scheme' s operations and procedures or requiring AFCA to report and provide reasons to the Government on an annual basis in respect of any changes AFCA makes to its membership fees.

The ability to set conditions will ensure that AFCA is appropriately transparent, for example, by ensuring that any recommendations for improvement that are made as part of an independent review of AFCA be made publicly available.

The AFCA board will be comprised of an independent chair and equal numbers of directors with consumer and industry backgrounds. At the establishment of AFCA the responsible Minister will make a one-time appointment of the minority of AFCA' s board, including the independent chair, to ensure that it has an appropriate mix of skills and experience.

The Australian Securities and Investments Commission, or ASIC, will be responsible for ensuring that the AFCA meets the standards set out in the legislation on an ongoing basis.

To fulfil this role, the bill provides ASIC with the ability to set regulatory requirements that AFCA must adhere to and also provides ASIC with a general directions power to compel AFCA to comply with the standards set out in the legislation.

The enhanced accountability that AFCA will be subject to under the new regime represents a significant improvement over the existing regime, under which ASIC had limited powers to require dispute resolution bodies to improve their practices. The bill also introduces a new internal dispute resolution reporting regime.

Internal dispute resolution is a financial firm' s internal dispute resolution process that involves the firm' s initial response to a complaint. An effective internal dispute resolution process plays an important role in enabling financial firms to quickly resolve genuine complaints, without an EDR or court process.

To provide firms with an incentive to have best practice internal dispute resolution procedures, the Government is implementing a new internal dispute resolution reporting regime.

Under the new regime, ASIC will be empowered to create a legislative instrument that will determine the internal dispute resolution data that financial firms will need to report to the regulator. ASIC will then have the ability to publish this data at both the aggregate and firm level.

Publishing internal dispute resolution data will drive financial firms to improve their internal dispute resolution practices, by providing industry benchmarks on how long it takes to resolve disputes and highlighting poor performing firms.

Given the significance of these reforms, the Government understands the importance of having a smooth transition from the existing dispute resolution bodies to AFCA.

That is why the Government has created a transition team, led by Dr Malcolm Edey, a former Assistant Governor of the Reserve Bank, to drive the establishment of the AFCA.

Recognising the importance of seeking consumer and small business feedback on AFCA, as well as drawing on the expertise of the three existing dispute resolution bodies, Dr Edey has established a representative expert reference panel to assist his transition team.

The transition team will advise the Government on AFCA' s terms of reference, governance and funding arrangements. It will also make recommendations on the transitional arrangements required to appropriately resolve legacy disputes of the three existing schemes.

Following feedback from the Treasury consultation paper on the proposed competitive selection process for authorisation of AFCA, the Government understands such a process was not considered by a number of industry or consumer stakeholders to be the best way to deliver AFCA. A competitive selection process will not therefore be pursued. The bill also provides for the winding down of the SCT, which will cease to accept new complaints once AFCA commences operations. It will continue to work through its backlog of disputes until 1 July 2020.

The new EDR regime will result in significant benefits for consumers and small businesses, with less confusion, increased access to redress and greater accountability for financial firms.

As the Consumer Action Law Centre stated "Australians need one, high quality service to resolve their disputes against financial institutions quickly and fairly. The one-stop-shop announced today is a sensible move that can help Australians get justice".

This bill achieves this outcome and ensures Australian consumers and small businesses get free, fast and binding access to redress and compensation.

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

Ordered that further consideration of the second reading of this bill be adjourned to the first sitting day of the next period of sittings, in accordance with standing order 111.

Senator GRIFF (South Australia) (11:19): I move:

(1) That the Senate notes that:

(a) the report of the Community Affairs References Committee, Price regulation associated with the Prostheses List Framework, was tabled in the Senate on 11 May 2017;

(b) the price of devices on the Prostheses List has a material impact on health insurance premiums, which have increased by approximately 5.6% each year over the past ten years;

(c) prostheses account for 14% of the cost of hospital cover reimbursements, with a flow-on effect to the cost of premiums, as provided in evidence to the inquiry;

(d) private health insurers indicated to the inquiry that savings on prostheses would be passed to members through lowered health insurance costs;

(e) in February next year, the Minister for Health will announce the average increase in private health insurance premiums, which will take effect in April, based on the applications made by insurers this year;

(f) the Government's response to the 16 recommendations made in the report of the Community Affairs References Committee, combined with the prostheses price reductions it has already mandated this year, will help provide direction to private health insurers that may influence the level of premium increase they decide to seek for 2018; and

(g) the deadline for private health insurers to make an application to the Minister for Health for the 2018 private health insurance premium round is 10 November 2017.

(2) That there be laid on the table by the Minister representing the Minister for Health, by no later than 16 October 2017, the Government's response to the recommendations of the report of the Community Affairs References Committee, Price regulation associated with the Prostheses List Framework.

Question agreed to.

Senator URQUHART (Tasmania—Opposition Whip in the Senate) (11:20): At the request of Senator O'Neill, I move:

That the time for the presentation of the report of the Parliamentary Joint Committee on Corporations and Financial Services on its inquiry into the life insurance industry be extended to 7 December 2017.

Question agreed to.

Senator XENOPHON (South Australia) (11:37): I move:

   (1) That the Senate notes that:

      (a) the Government has embarked on a $35 billion program to provide nine Future Frigates to the Royal Australian Navy;

      (b) on 31 March 2017, a Request for Tender (RFT) was released by the Department of Defence to three foreign companies which stated that it was the Commonwealth's intention that the successful tenderer will directly manage and supervise the workforce undertaking the shipbuilding work, and that the responsibility for build management and supervision should not be subcontracted in its entirety to a third party entity;

      (c) the effect of these RFT terms is that Australian shipbuilders ASC Pty Ltd and Austal have been locked out of priming the Frigate Program project and this current plan places Australian shipbuilders in the shadows of new invitee foreign shipyards; noting ASC Shipbuilding has no work on its order books beyond 2019, the Government's approach could have significant impact on the future prospects of the company, and Austal will survive but certainly will not thrive;

      (d) the current RFT will not serve to create a sovereign shipbuilding capability, but rather have the opposite effect;

      (e) the Minister for Defence Industry has been quoted in the media stating that advice from the Department of Defence is that changing the RFT to mandate a particular shipbuilder would result in a delay of at least two years; and

      (f) it is implausible that permitting the fully-established, world-class, Australian shipbuilders ASC Pty Ltd and Austal and their experienced workforce and proven track records would slow down a program that would otherwise require the setting up, from scratch, of a foreign shipbuilder with no current workforce.

   (2) That there be laid on the table by the Minister representing the Minister for Defence Industry, by the close of business on 14 September 2017, a detailed statement from the Minister for Defence Industry justifying his claim made to the media.

Question agreed to.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:04): I indicate to the Senate that these bills are being introduced together. After debate on the motion for the second reading has been adjourned, I will be moving a motion to have the bills listed separately on the Notice Paper. I move:

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

Question agreed to.

Bills read a first time.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:05): I move:

That these bills be now read a second time.

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

Leave granted.

The speeches read as follows—

DEFENCE LEGISLATION AMENDMENT (2017 MEASURES NO. 1) BILL 2017

The Defence Legislation Amendment Bill 2017 will make some small but significant changes to Defence's practice and operations. Some stem from recommendations to Government and some deliver on election commitments. These are covered in the four schedules to this Bill.

The first Schedule amends the Defence Act 1903 to apply common sense to Defence prohibited substance testing.

It will enable a policy framework to broaden and expand the conditions under which a prohibited substance positive test result must be disregarded, including in circumstances relating to appropriate usage of over the counter medication or substances administered or dispensed by authorised persons.

Under the current arrangements, a positive test result may be disallowed with the direction or recommendation of a legally qualified medical practitioner.

The Bill will allow a positive test to be disregarded under certain circumstances specified in the relevant Defence Instruction issued by the Secretary and Chief of the Defence Force jointly under Section 11 of the Defence Act 1903.

This broadening of the circumstances is necessary to ensure that over the counter medication and other legitimate circumstances can be considered where a positive test result is returned. For example, it will mean that Defence will be able to ignore instances where a positive test result has been caused by a dose of generic cold and flu medication rather than something more significant.

The Bill will also simplify the termination provisions to align with the new Defence Regulation 2016 which prescribes procedural fairness, notice to show cause and warning provisions in relation to adverse administrative decisions.

Schedule 2 amends the Defence Reserve Service (Protection) Act 2001 to put in place greater protections for Reserve members. This is a Coalition election commitment and I am happy to be bringing these measures forward in this Bill.

The Defence Reserve Service Protection Act provides for the protection of Reserve members in their employment and education, to facilitate their return to civilian life after rendering defence service, and for related purposes. It sets out entitlements and prohibitions that apply in relation to people who at any time serve as members of the Reserves. The Act mitigates some of the employment and financial disadvantages Reserve members may face when rendering defence service and facilitates their availability to undertake defence service, and will enhance Defence capability.

It is the view of the Government that no one should be disadvantaged by choosing to wear a reserve uniform.

A review of the Act in 2008 (the Protection Review) concluded that, overall, the Act was working well and achieving its objectives. However, the Protection Review recommended a number of enhancements to the Act. The amendments in Schedule 2 implement many of these recommendations.

In particular the Bill will address the application of the employment, partnership and education protections in Parts 5, 6 and 7 of the Act to extend to all types of Reserve service. Previously, voluntary continuous full time service (which is the type of Reserve service that is typically used when a Reserve member deploys on operations) was only protected if the CDF (or delegate) had requested the member to undertake the service on that basis. This requirement resulted in confusion for Reservists and their employers as to whether the protections applied in any given case. This will no longer be an issue, as all defence service will be protected from now on.

The Bill will also extend the application of the financial liability and bankruptcy protections in Parts 8 and 9 of the Act to continuous full time service that is operational service. Previously, the service was only protected if it was continuous full time service following a call-out under the Defence Act 1903.

A civil penalty regime is also established to supplement the criminal offence provisions throughout the Act, including provisions dealing with discrimination in employment and education.

The provisions in Part 4 of the Act dealing with discrimination are enhanced to improve the clarity and consistency of these provisions, and to deal with harassment of Reserve members because of their defence service.

The employment protections in Part 5 of the Act are clarified, by stating when the protected period begins and ends, and by replacing the concept of suspending an employment contract with an entitlement to be absent from employment while absent on defence service.

The education protections in Part 7 of the Act are amended to provide a general obligation on education institutions to make reasonable adjustments to accommodate a member's defence service.

Schedule 3 will implement a recommendation of the 2015 First Principles Review of Defence. It will amend the Intelligence Services Act 2001 (ISA), the Navigation Act 2012 and the Telecommunications Act 1997 in order to transfer the hydrographic, meteorological and oceanographic functions from the Royal Australian Navy (RAN) to the Australia Geospatial Organisation (AGO). In conjunction, the Australian Hydrographic Office (AHO) will be transferred out of the RAN and into AGO.

This recommendation will be met in order to have all geospatial related information functions consolidated within the AGO. The transfer of these functions is expected to realise synergies in the exploitation of imagery and other data to produce intelligence and non-intelligence geospatial related information in support of Australia's defence interests and other national objectives.

The amendments to the ISA will permit AGO to provide its non-intelligence products and related assistance to an expanded range of entities in accordance with Australia's legal obligations and national interests. Among other things, this will ensure that AGO can, through the AHO, continue to effectively and efficiently deliver high quality hydrographic, meteorological and oceanographic services to the maritime community.

The minor consequential amendments to the Navigation Act 2012 and the Telecommunications Act 1997 are needed to ensure that the terminology used in those Acts aligns with new Defence organisational arrangements following transfer of those functions.

Schedule 4 will amend the Australian Defence Force (ADF) Cover Act 2015 to align a small number of provisions in this new superannuation Act with other military superannuation schemes and provide clarity in definitions.

The Bill will ensure that member's who resign from the ADF and later find that they could have been medically discharged will be able to apply to the Commonwealth Superannuation Corporation (CSC) to have their mode of discharge circumstances reassessed.

The Bill will also create a more contemporary definition to allow a child of a deceased member or invalid to become eligible at a later date, where the child currently is found ineligible at the time of the member's or invalid's death.

An example of how this could occur would be where a child of the member or invalid is over 18 and ceases full-time study to become the carer or to undertake a gap year prior to the member or invalid's death, subsequently resuming full-time study after the member or invalid's death while still under the age of 25.

The Bill will also remove the requirement for a child of a deceased member to be "wholly or substantially dependent" on the member or an eligible spouse. The amendment ensures that all eligible children of a deceased member are recognised regardless of where they reside and does not unintentionally exclude children who would otherwise be found eligible if there was no eligible spouse.

CSC will determine who to pay a proportion of the total pension where there are multiple spouses and eligible children.

As mentioned, this Bill moves to make some small but significant changes to Defence legislation.

They will be significant to the operations of Defence, providing streamlining to practices and common sense to regulation.

They will be significant to the members of the Defence Reserves, who will receive greater protection.

They will be significant to family members of the ADF who will now benefit from the changes to superannuation.

STATUTE UPDATE (SMALLER GOVERNMENT) BILL 2017

The Statute Update (Smaller Government) Bill 2017 (the Bill) would, if enacted, repeal three Acts, make amendments to ten Acts across the Commonwealth to support the implementation of the Government's smaller government agenda by abolishing seven Commonwealth bodies:

the Central Trades Committee;

the Oil Stewardship Advisory Council;

the Product Stewardship Advisory Group;

the Advisory Group of the Australian Sports Anti-Doping Authority;

the Plant Breeder's Rights Advisory Committee;

the Development Allowance Authority; and

the Corporations and Markets Advisory Committee.

The Government is transforming the way services are delivered and how government operates to create a smaller, smarter and more productive sustainable public sector.

The rationalisation phase of the smaller government agenda is now largely complete following delivery of a comprehensive package of smaller government reforms. This comprehensive package was initiated prior to the 2014-15 Budget with decisions to abolish unnecessary advisory bodies and boards, agencies and statutory bodies. This was followed by a number of successive smaller government initiatives.

Consistent with the smaller government agenda the Australian Government Governance Policy came into effect on 15 December 2014. This policy was designed with the intent of preventing the creation of unnecessary bureaucratic structures and ensuring existing Government structures are streamlined further over time. This policy also requires sunset or review dates to be set for all new Commonwealth bodies.

By the time of the 2017-18 Budget the smaller government agenda had announced savings of an estimated $1.5 billion through consolidating, merging and abolishing bodies.

The 2017-18 Budget also focused on transforming the way services are delivered and how government operates to create a smaller, smarter and more productive, sustainable public sector, better positioned to respond to the challenges of a rapidly changing environment and the continued need for fiscal discipline.

Since 2013, initiatives such as the smaller government agenda, contestability, Operation Tetris, and the efficiency dividends have generated efficiencies of around $7.6 billion in savings. The size of the General Government Sector (GGS) has also reduced.

The Bill continues to deliver on the Government's comprehensive package of smaller government reforms, designed to cut waste and duplication, while improving the efficiency and focus of the Commonwealth public service.

The Bill has been prepared in consultation with affected Commonwealth entities and where relevant State consultations have taken place.

I commend the Bill.

Debate adjourned.

Ordered that the bills be listed on the Notice Paper as separate orders of the day.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:06): 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 FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:06): 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—

The Higher Education Support Legislation Amendment (A More Sustainable, Responsive and Transparent Higher Education System) Bill 2017 gives effect to decisions announced in the Budget that reform the ways in which the Australian Government supports higher education.

It will support the Australian Government's goal for a stronger, more sustainable and student-focused system that preserves and expands access to education while achieving savings that are an essential contribution to Budget repair.

In the lead up to this year's Budget the Prime Minister said "we call on the other parties…to support the Government in bringing the Budget back into balance. It is a responsibility that weighs heavily on the shoulders of every single member of the House and the Senate".

The 2017-18 Budget contains a number of strategic decisions based on careful consideration. For higher education, the Budget story begins with the reversal of all remaining measures from the 2014-15 reforms.

The road to reform in Australia's higher education system in recent years has been a bumpy one. The 2014-15 Budget reforms were ambitious and they were controversial. Some measures have been implemented while others have been abandoned.

As we promised one year ago, in last year's budget, we have consulted broadly on a package of higher education reforms.

The ambitions we set were that those reforms be fair, that they drive quality and excellence, and that they ensure students have choice and opportunities to succeed.

We released a policy options paper: Driving Innovation, Fairness and Excellence in Australian Higher Education, which openly, prior to the last federal election, outlined a range of possible areas for reform and action.

We listened to the debate that followed and now we are acting.

Today, we begin with a clean slate.

The first challenge is to ensure our system can respond to the impact of the tremendous expansion in student numbers.

Over the last quarter of a century domestic higher education student numbers grew at more than three times the rate of the population as a whole – from 420,000 in 1989 to over a million by 2015. That is around 150 per cent growth.

This growth has imposed significant costs on taxpayers. Since 2009 student funding by the taxpayer has increased by 71 per cent, twice the rate of growth we've had across the Australian economy.

The astounding thirst for education has been enabled by the demand driven system in recent years. But it is driven by the reality that a post‑school qualification remains one of the best investments an individual can make. Graduates enjoy consistently higher employment and incomes than those who only complete schooling.

Even so, today's graduates need more than just the piece of paper that goes with a tertiary qualification. They need to build the habits that you need to succeed in a workplace and they need to gain the technical skills demanded by a changing economy. As more people pursue tertiary studies our concept of what qualifications mean has had to evolve.

On the supply side, our higher education system is exceedingly successful and has a first-rate reputation both here and overseas. Tertiary education now spans a competitive market where providers are more numerous, more diverse and more commercially oriented than ever before.

Looking abroad, education is one of our most successful exports and a major source of income for our universities. In 2016 education export income reached its highest level ever, at $21.8 billion. It is through the skills and insights provided by our current and future labour force that we will prosper in an uncertain global economic and political climate and take advantage of our proximity to the world's biggest and fastest growing economies.

The options paper canvassed scope for reform, with a genuine desire to hear from others how we should tackle the challenges facing our tertiary education system.

Because, frankly, we are all in this together.

We are all stakeholders of our education system in one way or another – as former, current or future students; as parents; as taxpayers; as educators; administrators, providers and, ultimately, as employers in businesses or service providers in every corner of Australia.

The sector and its clients responded wholeheartedly. We received over 1200 submissions to the consultation process from higher education institutions, peak bodies, representative bodies from industry and professions, and individuals.

Informed by both public and targeted consultation carried out over many months, this Bill contains an innovative, balanced and above all an achievable set of reforms that can position the sector for the future.

Schedule 1 of the Bill rebalances the costs of higher education between the government and students by making a relatively modest adjustment to the relative shares of taxpayer and student contributions to the costs of courses.

There is no fee deregulation. There will be no $100,000 degrees.

Let's be absolutely clear about that. All tuition amounts are capped for Commonwealth supported students, as they have always been.

However, it is reasonable that students bear a marginally greater share of the costs of their tuition. After all, it is they who will directly benefit from gaining qualifications through better job prospects and higher earnings over their lifetime.

Maximum student contribution amounts will increase by 1.8 per cent per year for four years – cumulatively a 7.5 per cent increase by 2021. Commonwealth contribution amounts will be reduced by the same amount in each of those years.

In addition, grants paid under the Commonwealth Grant Scheme will be subject to a modest efficiency dividend of 2.5 per cent per year in 2018 and 2019.

On the first of May, the Government released a report on university costs and revenues prepared by Deloitte Access Economics titled "Cost of delivery of higher education". The Government thanks the 17 contributing universities for their participation in and cooperation with this research. Ongoing participation in this data collection will be embedded in future funding – more on this later.

The report shows that the cost for universities to deliver bachelor level courses increased by 9.5 per cent between 2010 and 2015. Over the same period funding for university students increased by 15 per cent.

Universities have benefited financially by enrolling increasing numbers of students through the demand‑driven system.

There are efficiencies that have been gained from the scale of that growth.

There are also areas that need additional support. Veterinary studies and Dental studies are two fields of education whose costs of delivery are unavoidably high. This Bill provides for additional per student loading for these disciplines, on the same basis as the existing Medical student loading.

The demand-driven system for bachelor degrees at public universities is working and remains unchanged. Rather than place caps on bachelor‑level places as some have suggested over the last year, Schedule 2 of the Bill contains major reforms to improve student choice in courses that complement bachelor degrees – enabling, sub-bachelor and postgraduate courses.

Today's school leavers are investing two, three, four or more years of their life into furthering their education. In most cases they will graduate with a taxpayer-funded loan to repay. Students need to be confident they are getting a quality education that will allow them to get a job and succeed in life.

We all saw what happened with the VET FEE-HELP scheme that was poorly designed and poorly implemented. It was Australian taxpayers and exploited students who had to carry the can for that debacle.

This Bill puts higher education students in a stronger position to realise their aspirations and turn them into reality, without running the same risks.

A new system for the allocation of places for enabling courses will be introduced. These courses can be a life-changing stepping stone for students who need to bridge a skills gap before they commence university.

All higher education providers will be able to bid for enabling places. A more rigorous standard of academic preparation will be required for taxpayer-funded enabling courses. Providers will now also be able to levy a student contribution amount for enabling courses, ensuring that students enrolling in these courses are committed to their studies.

The amount is fixed and proportionate, at $3,271 in 2018 for an equivalent of one year's full time study; most enabling courses take much less time than this. Eligible students in enabling courses will be able to borrow their contribution amount through the Higher Education Loan Program and will continue to face no upfront fees.

The current loading applied to enabling places will be removed.

From 2018, approved sub-bachelor courses – diplomas, advanced diplomas and associate degrees – will become demand-driven at public universities. This move is to assist students for whom a bachelor degree may not be the best pathway. These Commonwealth supported places will be reserved for students who don't already have a degree, ensuring that places are targeted to those who need them.

To be approved, sub-bachelor courses must articulate into related bachelor degrees and have been developed with a focus on industry needs. These requirements will ensure the extension of the demand driven system is sustainable and adds value to the higher education options available to students.

At the postgraduate level, the Bill introduces innovation in the allocation of non-research postgraduate places, meeting a longstanding need for an up‑to‑date and more student‑centred approach.

From 2019, postgraduate Commonwealth supported places will be allocated directly to students, who will then exercise choice in their provider. Higher education providers will in effect be competing for the most promising postgraduate coursework students. This will not affect the allocation of postgraduate medical Commonwealth supported places, an issue that this Government is methodically working through in a separate process involving the Department of Education and Training and the Department of Health.

Further, from 1 January 2018, Schedule 2 of the Bill introduces the ability for providers to receive taxpayer contributions for units of work experience that count towards a Commonwealth supported qualification. Higher education funding will now incentivise greater links to industry.

Transparency is a major theme of these reforms.

From 2018, the Government is introducing a performance-based element to the Commonwealth Grant Scheme, worth 7.5 per cent of total CGS cluster funding – around $500 million annually.

For the first year, 2018, providers will be required to participate in the reform of admissions information and cost of teaching and research transparency initiatives that the Government has announced.

For 2019 and beyond, providers will be required to meet the above conditions, but their CGS funding will also be contingent on performance against key institutional performance metrics. The formula to determine this will be developed in close consultation with the sector over the coming year.

Our performance payments will give taxpayers and public policy makers confidence that demand driven enrolments are coupled with accountability that ensures high quality admissions practices, support for completion and a focus on graduate employment outcomes.

Australia's HELP scheme remains one of the most successful public policy innovations ever. Twenty-five years on, it is still the best and most generous – and effectively interest-free – loan that you can get.

But its success has meant that the value of outstanding HELP debt has risen sharply in recent years. Outstanding loans are worth around

$50 billion. Unless we act now, a quarter of new student loans will never likely be repaid.

To address this, Schedule 3 of the Bill introduces further measures to improve the sustainability of the Higher Education Loan Program. This Government has already introduced changes to HELP that include lowering the minimum repayment threshold from 2018-19, removing the 10 per cent upfront payment discount for HECS-HELP and the 5 per cent voluntary repayment bonus, and removing the HECS-HELP benefit.

Australia's HELP repayment thresholds are high compared with other income-contingent student loan schemes. Borrowers under the New Zealand student loan scheme repay 12 cents in the dollar on any income earned above the equivalent of around AUD $17,500 a year. Borrowers in England repay 9 per cent of any income earned above the equivalent of around AUD $36,000.

The time has come to bring thresholds down to more realistic levels.

From 2018-19, the non-repayment threshold will be lowered further to a level that will bring around 180,000 additional borrowers into the repayment stream. The new minimum income will be set at $42,000 but will be accompanied with a new and lower initial repayment rate of just one per cent.

That is about $8 dollars a week.

A further 18 subsequent thresholds and repayment rates will step up in small increments to reduce income clustering and to make repayment increases smoother and less noticeable as earnings rise.

There are new repayment thresholds for high income earners. Now, the highest income earners will pay up to ten per cent of their repayment income towards their HELP debt. The current maximum is eight.

The thresholds have also been rising relative to earnings. Relatively fewer people are now making repayments than in the past.

From now on, the minimum and all subsequent thresholds will be indexed using the Consumer Price Index. This will ensure repayment requirements are adjusted in line with cost of living, and streamline indexation factors used throughout the Act.

The Bill replaces Commonwealth supported places with HELP student loans for most Australian permanent residents and most New Zealand citizens. Any students already enrolled in a Commonwealth supported place will have their eligibility preserved for sufficient time to complete their course.

This means that Australian permanent residents and New Zealand citizens will no longer have to pay upfront for a course that their Australian peers can defer through a student loan. Upfront payment is a barrier for many students and their families, particularly if they are still establishing themselves here.

This is only possible because of the changes we introduced which commence this year and allow us to recover HELP debt from people who have moved overseas.

Australian citizens and permanent humanitarian visa holders will remain eligible for both Commonwealth supported places and HELP loans. So will the special cohort of New Zealanders who arrived here as children and meet the current long term residency requirements introduced by this Government in 2016.

Schedule 4 of the Bill ensures that the highly regarded Higher Education Participation and Partnerships Program (HEPPP) is better targeted and is enshrined in legislation with a new, demand‑driven loading of $985 per

low-SES student. In addition, annual funding amounts of $13.3 million in performance funding and $9.5 million for the National Priorities Pool will be guaranteed into the future.

Finally, Schedule 5 of the Bill makes a minor amendment to the definition of higher education award to limit it to awards offered or conferred by higher education providers under the Australian qualifications framework. It also updates the names of two institutions, the University of Technology Sydney and the University of Divinity, so that the name of these providers in the Act matches their current legal entities.

The measures in this Bill were designed with fairness, transparency and sustainability at their core. They were informed by a broad-ranging consultation process where every stakeholder had an opportunity to contribute ideas.

No student need pay one cent upfront for their higher education.

Students will no longer face the prospect of fee deregulation and universities will not face a 20 per cent cut to their funding.

Where there is a financial impact on stakeholders it will be achieved in a way that is gradual, fair and appropriate.

The Bill paves the way for much more student choice – in course and course provider. It supports the continuation of the best features of the current higher education system, underpins a vibrant education export industry, supports student career aspirations, and ensures industry has a skilled workforce.

This Bill brings to a close a thorough period of consultation and careful redesign of support for higher education.

More importantly, it brings certainty to a sector that is unanimous about the need for change and that has been left waiting long enough.

These reforms ensure our high quality higher education system can grow while meeting the global challenges it will increasingly face. It ensures it is fair for students who will continue to be able to access higher education irrespective of their background or financial means. They will have more choices and the Turnbull Government will ensure greater transparency so that the focus of our higher education system is where it should be – on our students.

Taxpayers, whose support means no one must pay course fees upfront, will get a better deal knowing that the Turnbull Government is looking after them, as it is looking after all Australians, fairly.

I commend the Bill.

Debate adjourned.

Ordered that the resumption of the debate be made an order of the day for a later hour.

Senator BUSHBY (Tasmania—Chief Government Whip in the Senate) (12:08): At the request of the chair of the committee, I present the report of the Community Affairs Legislation Committee on the Vaporised Nicotine Products Bill 2017, together with the Hansard record of proceedings and documents presented to the committee.

Ordered that the report be printed.

Senator BUSHBY (Tasmania—Chief Government Whip in the Senate) (12:08): At the request of the chair of the committee, I present the report of the Environment and Communications Legislation Committee on the Environment and Infrastructure Legislation Amendment (Stop Adani) Bill 2017, together with the Hansard record of proceedings and documents presented to the committee.

Ordered that the report be printed.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:08): I seek leave to make a statement of no more than two minutes on the Environment and Communications Legislation Committee report.

The DEPUTY PRESIDENT: Leave is granted for two minutes.

Senator DI NATALE: Yesterday, two weeks out of winter, it was almost 34 degrees in Sydney. Today, we've got almost 100 bushfires burning across New South Wales. This was the hottest day in the 159 years since records were kept for that time of year. We are two weeks out of winter. Now, in the Atlantic, we've watched some of the most powerful storms ever recorded, wreaking havoc right across North America and the Caribbean resulting in the tragic loss of life. Just earlier, during motions, in response to this, we saw a minister laugh his way through a question on climate science. Here we are now with a report that makes it very clear. Are we going to act to stop Adani's giant, dirty, polluting coal mine from being built? They're doing everything they can to pave the way for Adani's mine and for the dying coal industry. This is negligence. It's disgraceful, and in a few years time people will look back and condemn this parliament for allowing this mine to get off the ground.

It's particularly duplicitous coming from the ALP. Federal Labor might pretend that it isn't beholden to the coal club, but we now know the truth. The truth is very, very clear. Queensland Labor is doing everything it can to get the Carmichael mine off the ground. We know that this mine wouldn't get off the ground if the Palaszczuk government refused to subsidise it, but it won't refuse to do that; in fact, it's supporting this mine. And now federal Labor doesn't have the guts to support a bill that would stop Adani. How many records need to be broken? How many lives need to be lost? Are we going to lose our Great Barrier Reef and have more bushfires and more extreme weather until we act? We have no time to delay.

Senator XENOPHON (South Australia) (12:11): by leave—In respect of the Broadcasting Legislation Amendment (Broadcasting Reform) Bill 2017, I move amendments (1) and (2) on sheet 8261 together:

(1) Schedule 3, item 1, page 10 (line 34), omit "360", substitute "600".

(2) Schedule 3, item 1, page 11 (line 1), omit "45", substitute "100".

These amendments relate very simply to minimum local content programming requirements in those areas that haven't had the same requirements in the past. This has been the subject of legislation I've previously moved to ensure that there is more local content for areas, such as the Riverland and the south-east of South Australia, that weren't protected by legislation that mandated minimum local content requirements. In the event of any ownership changes or any mergers, amendment (1) would omit '360' and substitute '600' and amendment (2) would omit '45' and substitute '100'.

The effect of these local programming requirements would be that there must a much higher requirement for local programming. It would translate to something like 50 minutes of local content per week—a significant increase; a doubling of the requirements. This is something I've long campaigned for. I note that Senator Ruston, from the Riverland, has been concerned about these issues. This is a significant improvement. For instance, this could mean more local stories and more local news in the Riverland and in the south-east markets. It would give the people of the south-east and the people of the Riverland an opportunity to have local news and local content to a much greater degree. It's not perfect; it's not the same as a nightly half-hour bulletin, but it would mean much more local content. I commend these amendments.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:13): Can I just indicate that the government supports these amendments. This is a variation on the proposition that the government has put forward, and we will be supporting it.

Senator O'NEILL (New South Wales) (12:13): Given that Senator Xenophon had the opportunity last night to speak for 20 minutes on the details of the deal that's been done in the dark, outside this chamber, but failed to bring in any scrutiny to it, I think these amendments are quite outrageous. There are two numbers that Senator Xenophon is proposing to change. This is a fig leaf on a fig leaf. These amendments have been moved so that it looks like Senator Xenophon has done something in this chamber and so people have something to look at.

If we actually go to page 10 of the bill, as it stands, it comes at a section of the bill that talks about trigger events and then local programming requirements. This is important; but if this is all we are getting from Senator Xenophon in terms of an amendment, while he's out crowing about how fantastic the deal is that he's done, then this is simply an embarrassment. If we go to 61CX in the bill, we see here a comment:

… 360 points in each timing period that begins after the end of the period of 6 months beginning on that day—

And there's a change to the number of 600.

It says this is:

… a trigger event for a regional non-aggregated commercial television broadcasting licence occurs on a particular day …

And it says:

… the licensee must broadcast, to each local area, material of local significance in order to accumulate at least—

That 600 points. That's it; that's his first big amendment. It's one minor change. I noticed in the comments that the senator put on the record today that this may lead to—this is what I heard—an increase in local coverage. That is it. That is what we get. We get 600. Then we go onto point (d) under 61CX in the legislation, where it says there are:

… 45 points in each week that is included in a timing period covered by paragraph (c).

It's an increase from 45 points to 100 points. Now, seriously, when you look at this as the entirety of the Xenophon amendments you have to wonder why he even bothered to bring it in.

Last night we saw an amazing event here in the parliament, where the One Nation amendments that were dispatched of last night were actually documented in this place by another senator from another party and, when they came for a vote, the One Nation party didn't even show up to support what was a declaration of the known bits of the deal that they're supposed to have done with the government. After Senator Xenophon has given us chapter and verse on how fantastic the deal is that he's delivered—which, by the way, I notice is being characterised in the papers today as a 'trinkets and baubles' concession from the government, and I have to agree with that characterisation—we are now faced with this amendment.

I have to say that I thought Senator Xenophon might have a whole host of other amendments that he would suddenly spring on us this morning, which might have locked down some of the supposed deal that he has constructed with the government, seeing as he has started to talk about a very significant change in the ACMA responsibility for looking after some of the changes that he mooted in his conversation last night. I wish I could be more specific, but I have got nothing to look at. I have no papers; there's nothing that has come in here for me to give the scrutiny that it deserves.

What we have got is a change of the role for ACMA that is really quite significant, and that is not made clear in any way in any documentation. Instead, we have this amendment suggesting a change, under 61CX, from 360 points to 600 points to increase the coverage. The senator has told us this morning that 'may occur'—so, 100 points instead of 45—in a timing period, with regard to the capacity to keep a licence. This is an embarrassment. This is such a tiny amendment to a piece of legislation that is quite significant.

This is a package that the government has been putting forward for 18 months, which it could have put through a long, long time ago if it had only had the courage to stand up for the Australian people and pull the two-out-of-three rule out. If it had, we wouldn't be in this position where we are looking at this embarrassing amendment. The reality is this amendment, at this stage, simply doesn't cut it. It simply doesn't deliver anything significant for the Australian people. It doesn't provide protection for people in the regions to actually have a view of the world around them. It doesn't increase anything. It simply provides a cover for Senator Xenophon to say that he's moved some small amendment in this place.

What really concerns me is that, last night, in order to construct this deal—where we have got 600 points in each timing period and 100 points in each week as the major piece of legislative change that's going on with this bill that's before us—what got sacrificed was protection for the ABC and the SBS. Senator Xenophon, with the show that he was putting on, sought to distract us all from the fact that he's letting this ABC SBS special deal, cooked up with the minister, go ahead outside of this chamber.

One of the committees that I get to participate in is the Parliamentary Joint Committee on Corporations and Financial Services. We have done some very good work there. Indeed, this morning I was standing up with Senator Xenophon giving a press conference on delivering a unity report around changes to whistleblower protection. Whistleblower protection is all about putting things that are going on in the dark into the light. It is about cultural practices that make the hidden transparent. This is the hypocrisy of what we've seen on offer from Senator Xenophon today—doing all of his dealing outside of this chamber, in the unlit market, if you want. There is no transparency about what's been done. He thought it was good enough to come into the chamber and deliver 20 minutes last night, with some sort of a shopping list of things that has been concocted with the government in the course of this week—one can only assume—offering up this tiny, tiny change. Two numbers—that's all that Senator Xenophon has achieved in terms of the changes in this bill. That's it in its entirety.

Labor cannot support this amendment because of the construction of the whole deal and the way in which the senator has brought this to the chamber. It simply isn't substantive enough to provide adequate protection for all the things the senator says that he has achieved for the Australian people. The broadcasting reform bills and the many backdoor deals that are associated with them represent a direct assault on media diversity in Australia. They hand unprecedented media power to a very privileged few commercial operators, and, at the same time, these deals that are part of what's going on here provide for an incredible attack on Australia's national broadcasters, the ABC and the SBS.

Senators in this place get around the country, and we know there is one thing that Australians have great faith in, and that is our national broadcaster. What we see in this amendment is nothing that's going to deal with the threat and the challenge presented by the other deal that has gone on here, between Pauline Hanson's One Nation and the government, also a deal done in the dark—unobservable, reported in some quarters but inadequately presented for the scrutiny of the Senate. This amendment that Senator Xenophon has moved comes in the context of one of the most concentrated media markets in the world, and yet we have seen the Turnbull government hell-bent on making it worse by repealing the two-out-of-three cross-media control rule.

The Turnbull government have been trying to repeal this two-out-of-three rule for 18 months. They haven't been able to do it on merit, and that is why we're at this point, where we've got this fig leaf of an amendment coming forward from Senator Xenophon. They couldn't do it on merit, so they've gone to the back room to do a deal outside of this chamber. The One Nation party and the NXT party look like they're going to get this through. It will include a grant of $30 million to Fox Sports, plus embed an attack on the ABC and SBS.

The proposal to repeal the two-out-of-three rule is contrary to the public interest, and Labor want to make that very clear today. Despite the speeches that have been made, despite the assurances that have been given, despite the shopping lists of deals that have been done with the government, we are very concerned about the loss of the two-out-of-three rule. It's a vital safeguard that continues to do the heavy lifting in our market and it maintains diversity in Australia. Those opposite argue that diversity will continue regardless. But, once this bill goes through—and it looks like they have stitched up the numbers to make it happen—we can't go back from what this government is about to give away, giving away two out of three.

We know, earlier in this process, Senator Hanson was very clear that she was going to stand up for the bush and make sure they were looked after. Well, the deal got done—is it the bush or the ABC? Does she want to attack the ABC more than she wants to look after the people in the bush? Clearly, she wants to attack the ABC, and she's done her deal around that. Senator Xenophon, not to be left out of the deal-making, because that would be an upsetting experience, has dealt himself in. And he's delivered $60.4 million, and how many cadetships was that—40 or 50?

Senator XENOPHON: Two hundred.

Senator O'NEILL: Two hundred cadetships for local newspapers, supposedly in regional areas, where papers are dying. There are 4,000 journalism students in Australia already. We don't need more cadetships; we need more jobs. Once we cut diversity, one owner can say, 'Well, you can put your message out on radio and TV and print, and you can just spread it a little bit further.' It doesn't mean it will grow any jobs, and it doesn't mean we will get an increase in diversity.

We know that letting the two-out-of-three rule go is a big deal. This government has had plenty of opportunities. Months and months ago, they could have had this legislation through—all of it, except for the two-out-of-three rule—but they wouldn't give. You have to wonder who has been in their ear to get them to a point where they are absolutely ready to sell the diversity of our media in this country down the river.

It is not just the government; it's also the One Nation party and the NXT party. They're in cahoots with this. Once this is gone, we won't be able to get it back, and that is the reality. When people vote for a government, they set a direction, and once they set the direction and undertake legislation like that, there are things we lose. And today we have to be clear: we are losing something. Two little numerical changes in the legislation from Senator Xenophon with his amendment is not going to do anything to protect us from that.

We keep hearing the Turnbull government say that this rule is out of date. But let's just look to a very recent event that just shows how vital it continues to be. We were told just before we broke, prior to the last session, that Channel Ten was in all sorts of problems and that there was no way it was going to survive. Receivership was being considered, and the pressure was on here. People were walking the corridors telling us we had to pass the legislation then. But there were enough people with enough integrity to hold out and protect this two-out-of-three rule, and instead they have caved now. Recently, we have seen that the CBS effort to acquire the Ten Network is proof that the two-out-of-three rule is a vital safeguard that continues to do the heavy lifting in maintaining diversity of the media in Australia.

For the government to argue that it's out of date, even in the context of this absolutely prominent recent event, continues to show that this is an ideological commitment to just getting rid of diversity. CBS are in the midst of wanting to purchase Channel Ten, and that provides diversity. We needed to keep this rule. So, my question is: how does this amendment in any way protect the Australian people in the way the two-out-of-three rule does?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:29): I just want to indicate, for the record, that the Australian Labor Party have indicated that they will be voting against additional local content in the disaggregated areas. The government, in its legislation, will for first time have a minimum requirement for local content in the disaggregated areas, following a trigger event. And Senator Xenophon's amendment will see that increase even further. That is important. In terms of diversity measures, I canvassed in my second reading speech the range of diversity measures which will remain in place.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:29): Minister, I'm interested in why The Guardian was excluded from this deal with Senator Xenophon.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:30): The arrangements that we have in terms of the Innovation Fund were aimed fairly and squarely at Australian media organisations.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:30): So where did the rationale for excluding foreign ownership come from? It is not a restriction that applies across any other media formats. I'm just interested in knowing why it was specifically applied in this area.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:30): The government wanted the focus of these arrangements to be on Australian media organisations.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:30): But The Guardian, as I understand it, are based here. All of their journalists are based here. They research and write specifically on Australian issues. They've got independent editorial control from London, which is more than I can say for some other news outlets. It's hard to escape the fact that this was structured in a way to do anything other than deliberately exclude The Guardian and other Australian based international outfits that are, indeed, holding the government to account. These are outfits with independent editorial control. They are based here and their journalists are here and yet we have a rationale that doesn't apply across any other media format. These are organisations that hold governments to account. So it's hard to escape the conclusion that this was done for anything other than political reasons.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:31): The government thought that it was important that there be a control test here. Senator Di Natale has cited one organisation. I could also cite that News Ltd is excluded.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:32): The idea of tax offsets and incentives to try to get more journalists employed, particularly journalists with a focus on public interest journalism, was taken off the table. I'm interested in knowing whether it was taken off the table because specifically the organisations that it would have applied to would have been organisations that practise independent journalism. We can look at specific outlets. There is The Guardian, as we have already mentioned, but there is also BuzzFeed and the Huff Post. They've all set up here in Australia. They are new voices in the media landscape. They've been welcome additional contributors to the national debate. What other rationale could there be for excluding those voices—The Guardian, BuzzFeed, Huff Post and so on—from having access to a range of tax offsets, a range of incentives, that would have allowed them, along with other players, to employ more journalists? We know it wasn't cost, because the cost of something like this is minimal. What is your rationale for taking those off the table?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:33): Senator Di Natale is referring to speculation in terms of what may have been the subject of discussions with crossbench colleagues. I have always made it a point not to comment on discussions that may have occurred, regardless of the grouping.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:33): Can I just go back to The Guardian. Do you make a distinction for an organisation that is funded here in Australia? It might be a subsidiary of a foreign organisation, but I don't know that The Guardian describe themselves as being a foreign-owned publication. They're funded here through a range of donations. So I'm just interested in how you make that distinction.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:34): There will be a primary purpose test, an Australian residents test, an independent test, a control test and a number of other requirements for eligibility.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:34): In terms of the operation of the fund, who picks the recipients of these funds? Is that something that the minister does? Does the minister effectively decide how that money is spent?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:34): This will be at arm's length from government, under the auspices of the ACMA with input from an advisory committee with appropriate industry representation.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:34): Just on that, what role does the minister have in that? Do you have the final sign-off? Are those decisions ultimately something that you have any discretion over? Can you override any decisions that are made by the ACMA? Further, in terms of the appointment of the advisory board, can you please outline how that process occurs?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:35): The minister won't have a role in the decision-making. In terms of the advisory board, appropriate industry representatives will be invited. I'm thinking of organisations such as the Walkley Foundation, the Press Council and the Country Press Australia, for instance.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:35): Ultimately, is that something the minister approves and endorses? Are you the final arbiter in the appointment of those positions?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:35): Well, the government would invite organisations to provide representatives, and then it is a matter for the ACMA and that body and its recommendations.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:36): You haven't really answered the question around the appointment process. Ultimately, are the appointments made by the minister?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:36): Yes.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:36): Do they report to the minister?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:36): No.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:36): With my final question, I'm just interested in where the funds are going to be spent. There's a question around whether some of this money is going to be spent on, for example, marketing, capital funds, training programs and so on, as opposed to sustaining continuous jobs in journalism. So I'm interested in what areas the funds can be spent on.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:36): Grants could be allocated, for example, to programs and initiatives, such as for the purchasing or upgrading of equipment of software, the development of apps or business activities to drive revenue, readership and training, all of which will assist in extending civic and regional journalism.

The TEMPORARY CHAIR ( Senator Bernardi ): How many last questions have you got, Senator Di Natale?

Senator DI NATALE (Victoria—Leader of the Australian Greens) (12:37): This is absolutely the last. Just finally, is it possible under this fund that all money could be expended on the areas that you outlined—maybe new technologies, equipment and so on—and that no money goes towards sustaining jobs in journalism specifically?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:37): There will be no expenditure on salaries. The measures are designed to support and create an environment conducive to employing people—there are the scholarships and the cadetships. But in terms of the innovation fund, anything that supports a media organisation being a good business can only be good for and is intended to assist that organisation in being viable, and viable organisations are in a much better position to employ people.

Senator O'NEILL (New South Wales) (12:38): Can I just comment on the process that's going on here, as it concerns me. Senator Di Natale is having to ask these questions here with no papers and with no documentation. The minister is looking over his shoulder to his adviser, as if saying: 'Well, am I appointing them? Am I not appointing them? Who do they report to?' We didn't even get an answer to that question. Well, they don't report to the minister, apparently. Well, maybe they do or maybe they don't. Maybe we'll go back to look at this and find out that was wrong.

Senator Fifield: I answered as clearly as I can in one word.

Senator Hanson-Young: We did get an answer to the fact that no journalists are going to be employed.

The TEMPORARY CHAIR: Order, Senator O'Neill has the call.

Senator O'NEILL: There is still a question on the board there from Senator Di Natale, which is: who do they report to? If they don't report to the minister, who do they report to? That's one question, for starters, that deserves an answer in the absence of papers. I will ask another couple of questions. In connection with media organisations eligible for funding, following on from Senator Di Natale's questions, can the minister confirm whether or not InDaily—which I understand to be an independent news website, based in Adelaide in Senator Xenophon's home state of South Australia—will be eligible for grants or other funding?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:39): I don't know because I don't have an encyclopaedic knowledge of every single media organisation in Australia, so I can't advise what their particular circumstances are and how they might be assessed according to the criteria.

Senator XENOPHON (South Australia) (12:40): Can I answer that, if it could be helpful to Senator O'Neill. The InDaily would clearly qualify under the criteria set here. It belongs to a media organisation with a turnover of over $300,000 and less than $30 million. It clearly is an independent publication. It will be able to spend on business activities, promotion, equipment, development of software and business activities to drive revenue and readership and training. It would also be eligible for the cadetship program.

Senator O'NEILL (New South Wales) (12:40): That's a little breathtaking, what just happened there. Because the minister couldn't answer the question, he has outsourced it. The government is now Senator Xenophon. Thank you for the actual correct answer, Senator Xenophon, but how is it that you know the answer to the question that the government is going to be responsible for enacting, and the minister doesn't know it? With all the resources that he has, he can't answer that question. But you know that there is a paper or a newsagency called InDaily down in South Australia that is going to be getting in on the good luck that you've delivered for a certain number—$60.4 million, or $50 million, of it is going to this capacity for agencies to get it. So this is another expression of what is so concerning about what's going on here.

I could ask a global question: Minister, do you actually know what's happening here? Are you going to provide any details about the criteria so that you can answer the questions rather than Senator Xenophon with regard to the detail of matters like this?

Senator HANSON-YOUNG (South Australia) (12:41): I just think it's extraordinary that we've heard from the minister this afternoon that none of this money is going to go towards journalists' salaries. What is the money going to be spent on, Minister? Also, I would like to ask Senator Xenophon: did you know that none of this money was going to go towards employing journalists?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:42): I outlined the range of things which will be within the scope of the innovation fund. Salaries will not be in the scope. Commonwealth grants are not provided for salaries. That's not something that Commonwealth grant programs do.

Senator XENOPHON (South Australia) (12:42): I'm very happy to answer Senator Hanson-Young's question. The purpose of the fund is to assist small publishers in metropolitan areas and regional independent publishers to transition, compete and innovate more successfully in a changing media environment. Grants could be allocated, for example, to programs and issues such as the purchasing of or upgrading of equipment and software, development of apps, business activities to drive revenue and readership and training—all of which will assist the bottom line of those organisations and, in turn, assist them to maintain and expand the employment of journalists. Eligibility for the grant funding will be broad and flexible. It won't extend to salaries. But you can imagine that, in terms of capital equipment, software, training and those capital costs that form an important part of the organisation, it will help.

InDaily is a very good publication based in Adelaide that is online. It breaks stories and covers a lot of local politics and news. It's an independent publication. I believe it and many others will be supported by this.

I will just make two other points very briefly. What is before the committee at the moment is the amendment I moved on local content. I direct this to my colleagues in the Greens and, indeed, other crossbench colleagues and One Nation. This is about increasing local content in those non-aggregated markets in the event that there is any change in the ownership structures that would be triggered by the legislation. In the Riverland and in the south-east, it would mean that it would double the existing requirements for local content in the legislation. I believe that is a good thing. That is something that I push for in legislation. I note that the government and the opposition back then did not support that, but here is an opportunity for those not in aggregated regional markets to have more, not less, local content. In relation to the matters raised by Senator Di Natale in respect of The Guardian—a very good and important line of questioning—I can say that the negotiations were protracted. It has been my preference and the preference of my colleagues that The Guardian be included. In terms of the overall package of measures, it is an argument that I lost.

Senator Di Natale: You didn't lose it. You didn't lose the argument; you are the argument.

Senator XENOPHON: Well, I did. There is a package of other measures for small—

Honourable senators interjecting—

Senator XENOPHON: It was the best deal, and in negotiation—

Senator Di Natale interjecting—

Senator Chisholm interjecting—

The TEMPORARY CHAIR ( Senator Bernardi ): Order! Senator Di Natale! Senator Chisholm!

Senator XENOPHON: This was the best negotiation we could come up with in relation to small independent publishers, including metropolitan publishers. I believe it's something that ought to be reconsidered, but, at the end of the day, The Guardian does have a parent company in the UK. The government drew the line at that, but it means that small independent metropolitan and regional publications will be able to get access to this very significant fund.

Senator O'NEILL (New South Wales) (12:46): There has been a great deal of speculation about this deal and a lack of information about what has gone on. But what we do know from that answer is that we can't just blame the government for throwing The Guardian under the bus; Senator Xenophon has facilitated it. That's what has happened. There's so much about this deal that we don't know. Senator Bernardi was actually able to stitch together some of the declared deal that was done some time ago with Senator Hanson with regard to the ABC and the SBS. It would seem that the minister—by media release on that occasion, 16 August, for the Pauline Hanson's One Nation deal—did put some information out about what was agreed. Senator Lambie had some comments to make last night about how dangerous it is to take the government at its word, even if it puts a media release out. I think her comments were that she is still waiting on two years worth of promises of a catch-up, and she hasn't forgotten.

Senator Hanson, who I note has come into the chamber, has gotten something from you, in terms of a media release about what was constructed—at least up to 16 August. But here we are, debating a suite of bills that the government says is the biggest media reform in decades, and we've got nothing—zero. Actually, we've got a change to two numbers—we can't forget that—from Senator Xenophon's amendments. We've got no detail. The minister, who can't answer the questions, is seconding Senator Xenophon to provide the details. My question is: when will the government publish information about the Nick Xenophon Team? Even in as fragile a form as a media release—as disrespectful to the Senate as that is—when is it that going to be put up? What has his department actually done to clarify this situation and record it?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (12:48): The elements of this have been shared with the chamber. That was done at the earliest opportunity—last night—and the government will, in the usual ways, make this and further information available in the usual formats.

Senator HANSON (Queensland) (12:49): Considering that Senator O'Neill has raised One Nation's input into the media reform bill, let me answer some of those questions. No grubby deals were done; that's what the Labor Party would actually love everyone in this country to think. It is as if they had never been in government and actually negotiated deals on legislation with the Greens, the crossbenchers or anyone else—and they're still trying to do their deals. As I've said, they still try to talk to us to get us to change our opinions and minds when I come into this chamber. When we look at legislation put up by the government, we look at it on its merits—will it be good for the Australian people—and that's the way it still stands. I don't do the so-called grubby deals. That's what the Labor Party is used to and that's what you've done for years and years with your union mates, with the unionists and all the rest of them. Let's put it in the right perspective of how your grubby deals have been done.

Senator Chisholm: It's simple: why didn’t you vote for Senator Bernardi's amendment?

Senator HANSON: To the chair: you see, they can't handle it. They can't handle seeing someone on the floor of parliament, with integrity and with honesty, who actually says it the way they see it and not through the grubby deals that they do with their union mates who are actually doing this. You know that this is a good deal for the media reform that's needed in this country. You know that Channel 7, Channel 10 and Channel 9 are actually struggling. You know that media outlets and also publishers—small publishers—and newspapers are shutting down. They can't compete with the internet and they can't compete with Google, and that is why they're closing down. You don't care about that. You don't care about the jobs that are going to be lost with this. Through the chair: have you taken any notice? I can tell you, a lot of journalists aren't my friends, but the whole fact is that they are Australians in employment; they have their jobs and they are losing their jobs.

Senator Hanson-Young interjecting—

Senator HANSON: Here we have the Labor Party, who are supposed to be so job orientated—

Senator Hanson-Young interjecting—

Senator HANSON: batting for the workers and wanting to see jobs for Australians. I have never seen a political party such as the Labor Party in all my life. They are not interested—

Senator Hanson-Young interjecting—

Senator O'Sullivan: You're so shrill. You're like a cockatoo.

Senator Hanson-Young: You are corrupt!

The TEMPORARY CHAIR ( Senator Bernardi ): Order! Senator Hanson, would you resume your seat, please. Senator Hanson-Young, I heard that. I ask you to withdraw it.

Senator Hanson-Young: Senator Bernardi, for the sake of debate, I will withdraw suggesting that Senator O'Sullivan is corrupt.

The TEMPORARY CHAIR: No, withdraw it unconditionally, please, Senator Hanson-Young.

Senator Hanson-Young: I withdraw.

Senator O'Sullivan: With an apology from you. You are a weird piece of gear.

The TEMPORARY CHAIR: Order! I ask the committee to respect the right of other senators to have their say without interruption and without rancour. Senator Hanson, you have the call.

Senator HANSON: If it was any reference to me, it just went over the top of my head. I have thicker skin than that. It's irrelevant what some of the other people in this chamber have to say. They're so thin-skinned. It's all right to dish it out, but they don't like to take it.

As I was saying, what I have seen here is that you're going to save a lot of businesses, publishers and jobs in this country with media diversity. I've spoken to organisations. They want this. They can see that they need the change in Australia if we are going to compete and if we are going to have our own media diversity in this country. All I've heard from the other side of this chamber, from Labor and the Greens, is that it's not going to improve media diversity and all the rest of it. Where's your argument? I have never heard the reasons why. They are not putting up their case. They're not putting up their case enough to convince me why it won't. I've listened to the businesses out there and they are the ones that are hurting. I've spoken to some journalists who have lost their jobs. They are concerned. The deals that Senator Xenophon—

Senator Hanson-Young interjecting—

Senator HANSON: has done with the government, with regard to passing this bill, are very credible. I think it's very good because he's looking at traineeships for cadets and the people coming through. Senator Hanson-Young made the comment: 'Where are the wages coming from for the journalists?' It is not the government's position to pay the wages of any private business. They don't do it. It is the government's position to make it feasible for people to get jobs. It is not up to them to pay the wages for private business. If those private businesses aren't successful, no-one at all will have a job. It's not up to the government to pay for the wages of journalists out there.

They talk about grubby deals but, let me say: there were no grubby deals done. If you actually have a look at what my agreement has been with the government, you will see that I'm asking for 'fair and balanced' to be in the charter of the ABC. It's part of what they are supposed to be doing anyway. So what's the problem with it? Don't we all want fair and balanced? Where's the argument there? Why would you oppose that?

Senator Chisholm: We saw your fair and balanced contribution yesterday. It was unhinged.

The TEMPORARY CHAIR: Order!

Senator HANSON: Isn't that what Australians want, fair and balanced? What I'm calling for and what I'm asking for is for those who are on $200,000 to be made public. Where's the problem there? Why don't you want accountability for the Australian people? Why do you have a big problem with that? Why do the ABC have a problem about showing what they get paid? It is Australian taxpayers' money. Our wages are out there—what we get. What is wrong with the ABC? Why do you want to be so quiet about it? Why do they fight tooth and nail against having that exposed? Is it because some their journalists are on nearly $400,000 a year for one night a week on TV? Do you think that's accountable? I don't, and neither do most of the Australian people.

The other apparent grubby deal was a deal for community radio to get some assistance and help so that they can actually—

Senator McAllister: Do you know who is Australia's most trusted news organisation, Senator Hanson? I'll give you a clue. It starts with 'A'.

The TEMPORARY CHAIR: Order!

Senator HANSON: As I said, people in community radio are the leaders of their small towns. They're struggling. They are the glue that keeps their communities together, because they give up their time to go into the community radio stations. I know; I've been to a lot of them. But here we are assisting them with a few areas: with news outlets and an extension of time—the government already has an extension from two years to four years—and they're streamlined as well, which will assist them. There are a few areas. There's $12 million. That's what we are going to give to assist community radio. I think that's fair.

There was a comment that we don't care about the bush. That's not the case. What we have actually said is that it's about time the ABC got out of the city areas and started looking after the bush because people out in the bush are being ignored. Only 17 per cent of ABC funding is going to rural and regional areas when they've got 35 per cent of the people there. So the ABC have lacked in their duties to people in rural and regional areas. We are saying that they have to have someone who is connected to rural and regional Australia to go onto an advisory committee and be on the directors' board. What's wrong with that? How on earth can you actually complain about that? We're actually looking after rural and regional areas.

Will I accept your attitude towards grubby deals—no. Why do you make these comments? Labor and the Greens comment and say 'grubby deals' because they are trying to denigrate One Nation, or even the Xenophon Team, for these arrangements and agreements that we've come to with the government to improve a bill, because a lot of Australians have been forgotten. It's not about grubby deals; it's about really caring. If they got their heads out of the sand and stopped their playing politics in this place and started representing the people of Australia, who really want true representation, they might get a lot further. But they are so pig-headed over this whole issue. It's about making the right decisions for the people of Australia.

Senator O'Neill said that I was against the two-out-of-three, and that was correct. But why I have changed my opinion is I've spoken at length with my colleagues, I've spoken to the organisations and I have listened to public opinion, and I can't be that bloody-minded not to change and say, 'I didn't get it right the first time around.' I've actually taken time to consider this. I've listened to public opinion and I've listened to the businesses, and I've come up with this decision. I wish some other people would actually listen to the facts and stop ridiculing, just purely for the basis of ridiculing. If you've got an argument, then put your facts forward and try to tell me why I shouldn't vote with the government on this bill. You haven't convinced me and I'm damn sure you're not convincing the Australian people.

Senator FARRELL (South Australia—Deputy Leader of the Opposition in the Senate) (12:59): I was going to make a comment on the previous Chair and his actions last night in this chamber. He made it very clear what he was proposing to do, which was—as I understand it—to introduce into this legislation those aspects of the agreement that the government has made with the One Nation party. I fundamentally disagree with what Senator Bernardi proposed in his legislation, but you've got to give him credit for raising those issues and giving the parliament the opportunity to vote on them. We were disappointed, Senator Hanson, that you did not come in and support the agreement that you had reached with the government. I think that was a surprise to everybody.

You just indicated that you have changed your view—that your original position had been that you supported the two-out-of-three rule but that you have now changed your mind. The reality is, Senator, that you do have the opportunity to change your mind again, and I would ask you to reconsider your support. You can see from the vote last night—even though you and your team were not in the chamber—that your agreement with the government will not pass this parliament. My recollection of the vote was that something like 55 senators voted against what would in due course become–

The TEMPORARY CHAIR: Senator Farrell, sorry to interrupt you, but you should make your remarks through the Chair.

Senator FARRELL: Thank you for that observation; I will make sure that all of my observations are through the Chair henceforth. We can see from last night that there is no support for those aspects of your agreement with the government that require legislative implementation. As that's the case, Chair—through you to Senator Hanson—as it's clear that this parliament will not support those aspects of your agreement with the government, why do it? Why vote with the government? Why support a proposition that is not going to get through this parliament? Why have an agreement with the government, when, plainly, as you saw last night—I assume you were watching it in your room, since you weren't in the chamber—this parliament is not going to pass that legislation? If you have an agreement with the government about this matter, that requires you and the government to agree to the matter and bring it to the parliament to be passed. Well, it isn't going to pass. That's now very clear.

That's the first point I'd make, Senator Hanson—you can now reconsider your position in light of what happened last night. If you think this government intends to honour that part of the agreement that you've reached with it to support this legislation, the reality was very clear last night that the Senate will not pass that legislation. Whatever you thought you were going to get out of this deal, it's now very transparent that you're not going to get it. So I would ask you, Senator Hanson, to reconsider your position. If you do, you can stop this legislation passing. As you've said, you've done that once before.

Maybe in light of last night's events, it's time to do it again. You were right the first time that you considered this legislation. You were right the first time because the purpose of the two-out-of-three rule in this country is to protect media diversity. As you say, there are lots of media that organisations that, from time to time, have a go at you. But you also get support from a variety. If you remove the two-out-of-three rule, that diversity goes out the window—we don't get the diversity. Of course, what we have seen is that Senator Xenophon from South Australia has also gone along with this. We saw what happened to your agreement with the government; it cannot be implemented, but I think we need to look at what Senator Xenophon has done as part of his agreement with the government to support this legislation.

As far as we can see, there is an innovation fund of $50 million over three years for regional and small publishers. I'm a big supporter of regional and local newspapers and other media, but what is a $50 million deal worth? Well, if it is split evenly across the states and territories, it works out to about $2 million a year. Of course, when you share that out over the totality of media in the region, frankly, Senator, it's not very much money. Some of those media organisations that you might have thought would benefit by this have, of course, come out in the last 24 hours and made it very clear—but I will refer to them in a moment.

It would seem that part of this $2 million that goes to the states will go to scholarships to support students who are studying journalism, with an emphasis on the regions. But, if you take away media diversity in this country by the removal of the two-out-of-three rule, they might get a scholarship to study, but the reality is there will be fewer jobs. So you are giving people a scholarship to study journalism, only to find that by taking away the two-out-of-three rule there are fewer jobs. So what's the point, Senator Xenophon? What's the point of the agreement to give young students scholarships if—

Senator McAllister: Who'll employ them?

Senator FARRELL: I will take Senator McAllister's intervention, because her question is perfectly right. If there is less media diversity in this country, what's the point of giving scholarships to students who can't find a job? That's cruel for them because you're leading them up the garden path. You're making them think that you have passed some legislation which is going to benefit them and give them a job. The reality is that you have reduced media diversity in the country. This benefits not just some of the wealthiest people in this country but some of the wealthiest people on this planet. They'll do very well out of this deal, Senator Xenophon. But with the $50 million that you've got spread out over three years, spread out over all of the states and territories, I think it's misleading to the students who might take up these scholarships. The reality is they're not going to get any benefit out of it by way of employment.

So I have some questions of Senator Xenophon, through you, Chair. Has the government provided you with any details of how the innovation fund and those scholarships will be shared between the states and territories? Has the government guaranteed to set a minimum share of either of those funds that will go to your home state of South Australia?

Senator XENOPHON (South Australia) (13:10): I thank Senator Farrell for his question. Details of this were given in the chamber last night. They were published last night. Details of how the fund would work were set out. It is $50 million for regional and small metro media that wasn't on the table 24 hours ago. It will make a significant difference. The criteria have been set out. There will be a transparent process. The additional 200 cadetships will make a big difference to many regional publications across the country. That will be broadly proportional, based on the states and territories. The regional scholarships, which are also on a proportional basis, will also make a big difference for more media opportunities.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (13:11): I want to respond to some of the comments that Senator Farrell made in relation to other issues. Firstly, the agreement with Pauline Hanson's One Nation absolutely stands and it will continue to stand. I also make the point that there have been many predictions made in this place about the fate of legislation, about what may or may not pass through this place. I will be applying myself, as I do with every piece of legislation, to what we introduce to give effect to those matters in relation to the ABC. Many times we have heard predictions made about how something will not pass the Senate only to see those predictions proven to be untrue.

Senator O'NEILL (New South Wales) (13:12): Senator Xenophon, you just said that the deal that you did with the government was published. I can't find a copy of it anywhere. Is there any way you could furnish it now? I have gone to Hansard. The Hansard record goes to only 9 pm. There is nothing written for any of us to interrogate at this point in time. That's hardly what I call transparency. I ask you sincerely: can you table what you say has been published or could you advise where it is published so that I can access it and investigate it?

Senator XENOPHON (South Australia) (13:13): I think at about 11.30 last night a media release went out setting out all the criteria that was agreed with the government. I'm happy to provide Senator O'Neill a copy of that.

Senator O'NEILL (New South Wales) (13:13): Is it your media release, Senator Xenophon?

Senator XENOPHON (South Australia) (13:13): Yes, and it faithfully reflects the agreement reached.

Senator O'NEILL (New South Wales) (13:13): If that is the case, Senator Fifield, why have you not released a media release verifying what Senator Xenophon claims?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (13:13): I've already verified the agreement in this place.

Senator CHISHOLM (Queensland) (13:13): No-one could accuse Minister Fifield of being a fast mover, and I think this is another example of that. One thing I've had the benefit of since coming to the Senate is being on the Senate environment and communications committees and I had the opportunity to ask questions of Senator Fifield. He very generously takes it easy on new senators, which I'm very appreciative of. I've also taken a bit of an interest in what Senator Fifield and the shadow minister, Michelle Rowland, from the other place, do. One thing that has particularly caught my attention is what the shadow minister, Michelle Rowland, has labelled the 'Fifield triangle'. This is basically where issues relating to the minister's portfolio go to die. There have been plenty of examples of this. The current legislation that we're debating is a prime example. It was first introduced 18 months ago. I think it's come before the House or the Senate, or been listed, something like 10 times without actually coming to a vote. Indeed, we've seen the debacle this week, where he's combined both jobs. We had a debate earlier in the week, then it went away and then it's come back. We sat late last night and here we are again today.

I want to flesh out the Fifield triangle a bit further because I think it's interesting in the current debate. We know that the Australian Communications and Media Authority review took two years, and then sat on the minister's desk for another eight months. We also know that the Game on report, which was about the future of Australian video game development, spent 500 days in the Fifield triangle and still hasn't been released. This is something that the minister is responsible for. We also know that the Australian Communications and Media Authority have gone 18 months with an acting chair, and there is still no permanent appointment to that spot. As I said, we know that the minister has had this legislation on the table for 18 months without actually getting anywhere—such is the incompetence.

But there is one issue that the minister moved really quickly on and that was to give $30 million to Foxtel. When you look at the record of this you see that there is no documentation and very few facts that he has put on the table in this regard. He made a very, very quick decision on that. He announced it as part of this package a couple of months ago. As I mentioned, I had the opportunity to ask questions of the minister at Senate estimates, and basically the best he could come up with was that this was a government decision. On 6 May, he announced that they would provide $30 million to Foxtel to increase coverage of women's and niche sports. It all goes to Foxtel; it all goes to a pay TV operator. People have to pay to actually see this when it goes on TV. When I had the opportunity to ask questions, the best he could come back with, in a lacklustre effort, was that it was a government decision. So $30 million of taxpayer money to 'so call' increase the reach and coverage of women's and niche sports all goes to Foxtel. Subsequently, following an FOI by the ABC, no documents exist. So, basically, it was a decision made by the minister on a whim—no business case, no modelling and no consideration of who this is going to reach.

How are more people going to be able to see this coverage? Foxtel's own figures show that their subscriptions have dropped in the last 12 months, yet the minister stands here with a straight face and says that this is to increase the reach and coverage of women's sport. What an absolute farce! What about the kids in my home state of Queensland? What about the parents who can't afford Foxtel? How are their kids going to be able to see this? They're not going to be inspired by these sports; they won't be able to see this sport. What about a little girl growing up in Frankston, the minister's home state, whose parents can't afford Foxtel? They're going to miss out on this opportunity. The saddest part about this is that they are doing this at a time when women's sport is riding the crest of a wave. We've seen that with the launch of the women's AFL. Senator Farrell might interject here, because his team, the Adelaide Crows, won that first premiership; unfortunately—

Senator Farrell interjecting—

Senator CHISHOLM: I disagree with that. Unfortunately, they defeated the Brisbane Lions team. We've also seen the women's Big Bash League gain popularity at the same time. We also saw, this year, the domestic netball competition also rise in popularity. So, at a time when there's so much happening in women's sport, in what could have been such a really positive thing—by giving this money to free to air so that every child in Australia could see it—he gives the money to Foxtel so that fewer people can see it. This isn't going to increase the reach or the coverage of women's sport. It's going to mean there will be kids in plenty of parts of Australia who aren't going to have the opportunity to see this. This is a terrible decision by this minister, and it's at a time when women's sport is riding a wave.

We know, from talking to any national sporting organisation in Australia, that sponsorship is so important. What's the key to getting good sponsorship? Free-to-air coverage. If you talk to the AFL and the NRL, they all say that the key to getting sponsors in the door to sponsor your league or your club is free-to-air coverage. Yet, no, he doesn't help them in that regard. He gives it to Foxtel—with no business case, no modelling, no documents. He gives $30 million to Foxtel, a subscription television service that you've got to pay for. This is what this minister has been responsible for. Minister, can you confirm that there was no business case, that there were no documents, that there was no modelling, that Foxtel is a subscription service whose numbers are dropping and that, when it comes to this deal, this had nothing to do with women's sport; it was just a secondary consideration to you pleasing Foxtel by giving them $30 million with no strings attached?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (13:20): As we have traversed before on this issue, of course there was documentation in the context of the budget process. There were a range of inputs to what was a decision of government. The media reform package was considered and prepared in that budget context. The FOI applications to which I think the senator is adverting sought a very specific range of documents. Obviously there are other documents, but they are part of the cabinet process.

Senator CHISHOLM (Queensland) (13:21): That really failed to answer the key question here. Very simply, this money was to increase the coverage of women's sports and niche sports, yet Foxtel's own figures show that subscriptions are dropping. How can your decision to give $30 million to Foxtel possibly increase the coverage of women's sports and niche sports across the population of Australia? It is very easy, very simple.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (13:22): I think it's known that Fox Sports have four dedicated sports channels. They have a good track record of access to sports that might have a lower number of participants and that receive little or no free-to-air coverage.

Senator CHISHOLM (Queensland) (13:22): What an absolute farce! It goes to show he can't answer that question, because he knows that this isn't actually going to do anything to increase the number of eyeballs that are able to watch these sports. This is the deal you've done, Senator Burston, Senator Xenophon. This is what you've done. You've facilitated $30 million going to Foxtel, basically just as money that they can do whatever they want with—no strings attached. There is nothing that's actually going to do what the minister said, at a time when women's sport is riding the crest of a wave. This is going to do nothing for that. This is a tragedy for women's sports, when they're crying out to get on free-to-air television because that will bring in the sponsorship dollars, that will lead to crowds getting involved and that will lead to higher pay for women's sports, which deserve so much more than they have had historically. This minister does nothing for them. It is a shameful deal and one that he should hang his head in shame over.

Senator O'NEILL (New South Wales) (13:23): We understand that the package that's been delivered for the so-called innovation fund is going be administered by the communications regulator, the ACMA. Will the government be circulating an amendment to amend the ACMA Act? What advice has the government taken with regard to the ACMA, and does this deal that's been done require an amendment to the ACMA Act?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (13:24): Any necessary amendments will subsequently be introduced into the parliament.

Senator FARRELL (South Australia—Deputy Leader of the Opposition in the Senate) (13:24): I heard Senator Xenophon's answer to my question, but I don't believe he has fully answered it. I should make the observation, Senator Xenophon, that this could be your last chance to make observations in the Senate. What I mean is that your matter is going to the High Court before we come back again—

The TEMPORARY CHAIR ( Senator O'Sullivan ): Senator Farrell, once more you need to be reminded to direct your communications through the chair.

Senator FARRELL: I'm sorry; I should have recalled that, and I will do it through the chair. What we're asking for is answers from Senator Xenophon. He indicated that late last night, apparently, the specifics of the agreement he reached with the government to end media diversity in this country were released. We've tried to find that information and haven't been able to track it down, so our only way of getting that information at the moment is either through the government or through Senator Xenophon.

I recall—through you, Chair—that when Senator Xenophon first came to this chamber nine years ago his role model was Brian Harradine from Tasmania. You can look back at Brian Harradine's history, and just one of the many deals he did was over the sale of Telstra with the Howard government. He got $350 million for his state as a result of that deal. The question I'd like an answer to—a straight answer!—from Senator Xenophon is: how much of the $50 million or $60 million deal he's done with the government has been secured for his home state of South Australia? It's a simple question. I've not been able to find anywhere on the record, so far, that we've got an answer to that question. Senator Xenophon wanted to model himself on Senator Harradine; I think it's pretty clear now that Senator Xenophon is no Brian Harradine. He hasn't secured the sort of money that Brian Harradine secured when he reached agreements with the government. Tell us: if you've done this agreement with the government, how much have you got for your home state of South Australia?

Senator XENOPHON (South Australia) (13:27): I'll ignore the baiting and the ungracious remarks by Senator Farrell. If the High Court did manage to hand down a decision between 12 and 16 October, I'd be delighted. Somehow I think that might be a little unlikely, so you may have to see me again, Senator Farrell—I'm very sorry about that! I seek leave to table a document which I've provided a copy of to Senator O'Neill. It's headed 'Summary of Media Reform Negotiated by NXT'. It's a three-page document, and I seek leave of the chamber to table that document.

Leave granted.

Senator CHISHOLM (Queensland) (13:28): I wanted to reflect on the contribution we saw from Senator Xenophon last night. We know Senator Xenophon can be a bit of a chameleon, and until I got into this chamber I certainly had admired it from afar. Having been able to observe it over the last 12 months, the way that he performs in this place is very admirable. From what I can work out, there are basically three versions of Nick Xenophon. There's the South Australian battler, sticking up for his home state. There's the fighter against the system, sticking it to the mainstream parties. And then what we saw last night was the sincere and heavy-hearted Senator Xenophon, passing this more out of sorrow than anger, I think, in the way he spoke about this—that they were the toughest negotiations he'd ever had. I thought that was some very good theatre from Senator Xenophon.

If these are the toughest negotiations he's ever had, he didn't deliver up much of a deal, did he? And that's been exposed on the floor here today. Now that we've had an opportunity to look into the detail, what Senator Xenophon has done has really been stripped bare, yet we are going to be living with the long-term consequences for a long time. I think the most significant of those is that, now and forever, this government and Senator Xenophon will be responsible for aiding and abetting the attacks on the ABC. They have legitimatised it and given it an opportunity. That is what they are responsible for, given their actions.

We saw yesterday the efforts of the One Nation senators—and I don't think you could call that a fair and balanced contribution. But the one thing that I have really loved is the contribution in this debate from Senator Fifield and the way that he says 'fair and balanced'. He says it in, actually, such a fair and balanced way. It's very admirable the way he does it. But the problem for the government and the problem for Senator Xenophon is they have let the arbiter on fair and balanced be One Nation. That is what they have done by the way they have conducted this debate, let it happen and agreed to pass the One Nation legislation on this. That is something that the government and Senator Xenophon are going to be responsible for. Everyone else in this place will constantly hold them to account.

When we say 'fair and balanced', I think you only have to look at the contribution that we saw from the One Nation senators yesterday. There was nothing fair and balanced about it. All it actually was was a series of grievances that they had against the ABC. Well, if you don't like the ABC covering stupid comments or stupid things you've done, stop doing stupid things! It's pretty simple. Yet, they came in here, one after one, complaining about the stories that the ABC have done on One Nation. Then we had Senator Roberts come in. I thought that this was really interesting, given his own difficulties with the High Court. I think he's making a case to be the 'fair and balanced commissioner' if Senator Fifield wanted to appoint him. He went through all the empirical evidence that he is building. And we know he loves empirical evidence; he's always talking about it. But it seems like he's been doing his own homework on what he thinks is fair and balanced. We have seen some of the things that they talk about—some of the crazy stuff that they actually want to see the ABC cover more: the anti-vaxxers, the climate change denialists. This is what the government and Senator Xenophon are going to own. You're going to own it. That is what this government has done.

So, Minister, when are you going to stand up for the Australian people and defend the public broadcasters, the ABC and SBS, from the attacks that we are seeing from One Nation and others that you have legitimised through this deal that you have done on media reforms?

Senator O'NEILL (New South Wales) (13:32): Can I go back to the matter that I was asking questions about—the ACMA. I thank Senator Xenophon for making it clear that, despite doing the deal in the dark, he put this up on his website so that we could see what was going on. Thank you very much. I don't know if the government have responded yet. They have had the opportunity, I suppose, in the time we've been having this debate to put something up. Can I go to the comment in there on the advisory committee, which we did have some questions about—who they would be and where they were coming from—that the minister couldn't answer.

Senator Fifield: I did.

Senator O'NEILL: Do you want to put it on the record, Minister, who the advisory committee will be?

Senator Fifield: I have.

Senator O'NEILL: So the minister is not responding. The comment reads:

The advisory committee's recommendations will be made public. Further transparency measures will include details of the administration of the fund being included in the ACMA's Annual Report and scrutiny through Senate Estimates.

This change of the role for ACMA is described in Senator Xenophon's statement as the fund being:

… administered independently of government by the Australian Communications and Media Authority …

I've asked what changes are required for ACMA to be able to do that. In your response, Minister, you indicated that if there were amendments that were required you would do that at some later point in time. Why is it not prepared for consideration now, as this is part of the deal that you're doing? We've got no guarantee that what you have promised Senator Xenophon, in terms of ACMA administering this, is actually going to be possible. When do you propose to put these amendments?

The TEMPORARY CHAIR ( Senator Bernardi ): The question is—

Senator O'NEILL (New South Wales) (13:34): Does the minister not want to answer that question?

Senator Fifield: I've answered it already.

Senator O'NEILL: So, let me understand: the deal that you have done with Senator Xenophon requires—possibly, but you're not quite sure—changes to the capacity for ACMA to undertake the role that you've promised. And you have indicated that there may well be amendments that are required, but you don't know what they are and you can't put them before us today—is that correct?

The TEMPORARY CHAIR: The question is that amendments (1) and (2) on sheets 8261—

Senator O'Neill interjecting—

The TEMPORARY CHAIR: Just a moment. Senator O'Neill, are you seeking the call again? Standing orders prevent me from giving you the call. You've spoken twice already.

Senator KETTER (Queensland) (13:35): As a senator for Queensland, I have some concerns about the level of funding that might be flowing through to my home state. Minister: can you tell us and the voters of Queensland what level of funding is expected to come through for Queensland?

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (13:36): That's already been addressed here.

Senator O'NEILL (New South Wales) (13:36): Thank you very much. It seems the minister has decided that he's not going to answer any questions, and I certainly have quite a lot that I want to put on the record. So, I will continue with some comments and a few questions, and I invite the minister to respond at any point in time. What we have seen with this deal with regard to ABC and SBS is really outrageous. And this government has proven it is utterly desperate and bereft of integrity by bowing to the One Nation party's demands to attack our national broadcaster in order to scrape their flawed media ownership changes through this parliament.

As I said earlier, the Turnbull government has been trying to repeal this two-out-of-three rule for 18 months, but they haven't been able to do it on merit. So, this is why we are where we are. The pact between the Turnbull government and One Nation is regarded by many, in the commentary since 16 August, as a direct assault on the independence of our public broadcaster, the ABC and the SBS. I'm going to quote from Andrew Tillett and Max Mason in TheAustralian Financial Review from 15 August 2017. And I do want to put on the record my respect for the great work that our journalists do and their significant contribution to our community. I want to reflect on Andrew Tillett, who I recall as a junior cadet in a regional area where I live, outside of Sydney, many, many years ago. He is a person who really takes the standards of journalism very much to heart. He writes very carefully and asks very incisive questions. This is what Andrew Tillett and Max Mason had to say in the AFR on 15 August:

One Nation clinched a deal for the biggest assault on the ABC's independence in decades.

That's how it's being characterised. As part of the deal, the government has agreed to the insidious call for this competitive neutrality inquiry into the ABC and SBS. There is no way you can dress that up as anything other than a direct vehicle to attack the ABC and SBS and to diminish its role. And in response, Bernard Keane, from Crikey, said:

… the problem is that the inquiry isn't limited to … the ABC's online operations generally. It's focused on all the practices of the national broadcasters. And the problem is, the entire rationale for the national broadcasters violates competitive neutrality. Competitive neutrality principles require that government bodies are not subsidised to compete with commercial entities. But that's the entire raison d'etre of the ABC and SBS. If they were required to only engage in activities where there was market failure, what would they provide?

This goes to the heart of the attack we are seeing on the SBS and the ABC—a determination to clip its wings, to cut it back, to shut it down.

Indeed, in my notes I took yesterday, as Senator Hanson was making her comments, she protested and said, 'No-one should see this as an attack on the ABC.' But she also said in her speech that they should give up their slush fund. That is how she characterised the funding of the ABC, as a 'slush fund'. I think it is clear, after her contributions in the course of this debate, that Senator Hanson is going after ABC funding.

If you need any further proof that the Turnbull government are absolutely hypocritical in this context, with no clear vision for the Australian media, then you need look no further than this competitive neutrality inquiry. This inquiry is aimed at ensuring the SBS doesn't compete with the commercial broadcasting sector, yet twice now the coalition government have attempted to amend the SBS Act to permit the SBS to increase its advertising and enable product placement, in direct competition with the commercial broadcasters.

Labor believe that the ABC and SBS should have a presence in the digital media space as part of promoting diversity in our media. Labor believe that the content they produce should be readily accessible online. And Labor congratulate the ABC and SBS on their achievements with iView, SBS On Demand and online news. We affirm the recent speech by the ABC chair, Justin Milne, which was delivered at Parliament House quite recently at the ABC parliamentary showcase, where everybody, as I recall from the many years I've attended, shows up to get their photos with B1 and B2, those iconic images of the ABC for entire generations of Australians. If Senator Hanson goes ahead with this and doesn't reconsider pulling the two-out of-three rule out and her attack on the ABC, we might end up with only B1, and what a loss that would be! We are talking about serious cuts here. I wish to put the comments that Justin Milne made on the 16 August on the record here because they are very pertinent to the debate we are undertaking. He said:

Now, I may be an ABC ingenue but I’ve been around media for a while and can tell you that the advent of the internet, smart phones, instant global connectivity, Google, Facebook, Netflix and machine learning all mean that the changes we are experiencing today will be the biggest media has ever experienced.

In the past, we have accepted the "Mass Media" model—newspapers and TV stations publish when it suits them. If the audience misses the show, bad luck and if the audience wants to provide feedback, they can write a letter. In the future, we will demand that our media uses information about us and the world to provide an intelligent, personalised service, unique to each of us, available exactly when and where we want it—anywhere on the planet.

Today the ABC is one of Australia’s greatest cultural treasures, its most trusted broadcaster and a fundamental part of our thriving democracy. It will be tomorrow too.

And while we might receive some attention in the press from certain quarters—allegedly venturing into territory where we have no business, I assure you that this couldn’t be further from the truth.

The ABC has a clear mandate to serve all Australians …

And that is without the tinkering the government has promised to undertake. He said very clearly:

The ABC has a clear mandate to serve all Australians; to provide broadcast and digital media programs of broad appeal, and to reflect the diversity and multicultural character of the Australian community.

We are proud to live up to our Charter obligations. Our people come to work every day knowing they are doing a job which the public values. The Corporation is not reticent about exercising its legislative remit.

He went on to talk about the noise of recent weeks and applauded Australia as a democracy that has benefited from a dual-media system for 85 years—having the public broadcaster alongside commercial media. He claimed:

This media environment has ensured vibrancy and diversity, for the good of all Australians.

The level of criticism that the ABC has been subject to in the course of this debate is nothing like we've ever seen before. I think the remarks that were delivered by Justin Milne really give voice to the attack that that very important institution is experiencing right now.

Senator McAllister sent me an article that came out with some figures. It's the Essential Report. It's a survey that asked about trust in media. It says:

Overall, trust in media has fallen a little since this question was asked last year – however rankings remain much the same.

And this continues to today. It also says:

The most trusted media were ABC TV news and current affairs—

Sixty-three per cent said that they trust it a lot—

… SBS TV news and current affairs (61%) and ABC radio news and current affairs (58%).

Why we are at a point where we have a government that is willing to trade off diversity with One Nation for an attack on the ABC simply doesn't make sense to me.

Senator Fifield, I've got a couple of questions that I would like you to answer. The first one is: now that the government has decided to subsidise for-profit commercial media to the tune of $60 million as part of the deal with Senator Nick Xenophon and to the tune of $30 million for Foxtel, will the government promise to refund SBS all the funds that it cut from it, which is less than the $90 million that it's given to commercial media? The second question I have for you, Minister, is: will the grant of funds to commercial media be transparent and open to public scrutiny? If so, how will that process take place? The third question is: is it now government policy to subsidise for-profit commercial media while removing funding from public broadcasters? Those are three very direct questions. I'd appreciate some answers, Minister.

Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (13:46): The SBS will be funded in the usual way through a combination of its own revenue and funding provided in the budget. Yes, there will be transparency in relation to those measures to which you have referred. The government outlined the funding for the ABC in the budget before last, which establishes the training and funding base.

Senator DASTYARI (New South Wales—Deputy Opposition Whip in the Senate) (13:47): I want to acknowledge that Senator Bernardi, who's currently in the chair, really belled the cat last night on what these reforms are actually about, because a dirty deal has been done to secure the passage of this legislation. Senator Bernardi and, I understand, Senator Lambie—more in token nature than in whole-hearted support—highlighted what this is really about, and that is an attack on public broadcasting and an attack on the ABC.

We heard from One Nation senators who came into this chamber and—credit where credit's due—were honest about what it's about. Senator Burston has been incredibly honest about his views when it comes to public broadcasting. I commend him for that. I pay tribute and credit to someone who was prepared to say: 'This is my view. I will vote according to my view, and I will negotiate and strategise on how I can get legislation through that supports that view.' That's what One Nation has done. This isn't a victory for the government; this isn't a victory for media diversity. This is becoming a victory and has become a victory for One Nation. This is a victory for One Nation when it comes to media reforms here today.

I have to say that, when it comes to the issue of public interest journalism, a whole lot of crocodile tears have been poured in this place but the big ideas have actually been run away from. Through our Senate inquiry, we heard witness after witness and big idea after big idea. We were able to hear big ideas—again, some of which have the merit to actually be properly explored. Do you create a proper fund to allow investment in journalism to be treated in the same way as we treat research and development grants?

Do you end up levying a big company like Google to pay for that? These are the big ideas, if you're serious about the future of journalism, that should have been explored and needed to be explored.

I have to say—I said it last night, and I will say it again—Senator Xenophon, your position on this and what you settled for is so much weaker than what you were saying to the witnesses and others as we were going through our public inquiry. This is not a good deal. This is a $60 million slush fund that we find out is to buy iPads. It's to buy iPhones. Everyone's going to get a new iPhone X under this proposal! This is the slushiest fund imaginable. This isn't about the future of journalism. This is about a government throwing money at a problem to try to get the passage of legislation.

The worst bit about it is when you actually look at institutions like The Guardian, BuzzFeed and others. Again, the question I will specifically be posing to the minister in a moment will be about why he is creating this. I mean, we know what's being said in this chamber is different than what's being said outside it. We know that the minister has been telling people privately that the issue with including The Guardian is that he could not possibly—they had to exclude them—get it through his own backbench and couldn't get it through his own party. Senator Leyonhjelm belled that cat yesterday morning when he said that as long as there's nothing going to The Guardian, it's something he could support.

So what do you do? You create a slush fund to buy iPads and iPhones and, in doing so, you exclude different organisations when you may not like what they have to say. That is not media reform. That is not where we should be heading in this modern era when it comes to how we deal with media and how media needs to be dealt with. There are big challenges, but that's not what this legislation has addressed. What we have here is a government that has done its deals and has done a deal with One Nation, and then has gone and done a deal with the Xenophon group. They have tried to find a way of marrying the two together.

The only real honest brokers in all of this—I have to say again that it amazes me—has been One Nation, because at least they have held a consistent position to do in the public broadcasters. That has been their position from the start. Senator Hanson came into this chamber yesterday and, in her second reading contribution, made it very clear that there are journalists at the ABC who she dislikes, who she feels haven't given her a fair deal, and part of her reason for this is that. We heard from Senator Malcolm Roberts—again, consistency is a beautiful thing—who was able to somehow turn this entire debate into a conspiracy with the CSIRO as it relates to climate change and ABC coverage. Respect where it is due: sometimes it's tough to make the links that he keeps making, but he believes in it.

Then last night Senator Bernardi—I think it was at about five minutes to 11—actually exposed what this is all going to be about in the end. Senator Xenophon, we all see through this. We know what's gone on. You have gone to the government and said, 'Look, I'll cut you a deal. Cut me a favour here, and make sure the One Nation stuff is separated out so that I don't have my fingerprints on it.' That's what's gone on here. We all know that. We all know what's really happened here. This is a dirty deal that's been done at the last minute. This is not how big issues, big reforms and big changes should actually be dealt with and actually be tackled. That isn't what we've had here at all. What we've had is a cheap deal that was done at the last minute to keep One Nation happy and to buy off the NXT party.

There is the opportunity here to actually make big reforms and to actually reshape Australia's media landscape. What we have here is a fix to a problem, but, frankly, the inclusion of the potential CBS takeover of Network Ten changes it all anyway. What's the rush? The rush is because we were told it has to be done immediately, because Channel 10's about to go under. That is what we were all told. That is what the minister was saying in the media and that is what was being said privately. There was an urgency. Then, all of a sudden, you end up with this.

The specifics of the deal will get looked at by FIRB and others. I understand there is an ongoing legal case on what will happen with the future of Channel 10. I will let others far more experienced than me settle those legal matters. But the idea that we need to do this urgently wasn't there before. So, why this dirty deal at this hour in this way? That is a question that no-one has been able to properly answer in the Senate. To have this kind of a deal—frankly, we are all getting a bit tired of it, Senator Xenophon, we really are—through the chair. We all sit around like lemmings while you make this eleventh-hour deal that is going to throw huge issues up into the air—like what the future of the Australian media landscape is going to look like—and it all depends on whether or not they are buying you off well enough. You are a senator who made it so clear what your views were on horsetrading. Your views were so consistent for so long, and you have spoken so passionately and funnily and charmingly about it, but you then go and do these types of deals week after week after week.

And it is always the same: it's a last-minute deal; there will be an hour's motion, it will have support, we will be stuck here dealing with it, and there will be a pot of money that appears to look good on the surface. Then, when we get to the point of actual examination, we see how pathetically weak and small that pot ends up being. What we found out today is that this is a $60 million iPad-iPhone fund. That is what this is. This is for the new iPhone, everybody. This is what the Senate is spending its time and another $60 million on. I note what Senator Bernardi and Senator Leyonhjelm—who, again, have been quite honest in this debate—have said about it in the past 24 hours: they are not fans of this type of spending, but it is probably not bad enough for them to change their votes. I don't want to misquote other senators, but that was the gist of my understanding. They are both big enough and bad enough to speak for themselves.

Honourable senators interjecting—

Senator DASTYARI: They are your words, not mine.

The TEMPORARY CHAIR ( Senator Bernardi ): Order! Ignore those specific interjections, Senator Dastyari.

Senator DASTYARI: What we have is a last-minute deal that was done by the Nick Xenophon Team in the dead of night under dirty circumstances to keep One Nation happy. Every time we do these deals the same thing happens: on the surface they look fantastic, but when we start getting to the bottom of them we see that there's nothing there. These are dirty deals that have been done dirt cheap, and they are done at the 11th hour. We as a Senate are better than this. We as nation are better than this. Senator Xenophon, who has consistently got up in this chamber and spoken against horsetrading and against doing these kinds of deals, has spent the 11th hour doing this. It is an attack on the ABC and an attack on media diversity. This is a fix to a problem that it appears no longer even really exists.

There are going to be winners out of this legislation when it passes today, and the winners are going to be One Nation, because, once again, this government has kowtowed to them—has kowtowed to their coalition partner One Nation. Senator Xenophon has facilitated what will no doubt be a long-term attack on public broadcasting—a long-term attack on the ABC—and has broken a solemn principle that we don't horsetrade like this on this type of legislation. We have seen this time and time again. When proper daylight hits, and there is nothing more than a $60 million slush fund for iPads, we will see it for the farce that it is.

Progress reported.