The PRESIDENT (09:31): I remind senators that the question may be put on any proposal at the request of any senator. There being none, we will move on.

The CHAIR (09:31): The committee is considering the My Health Records Amendment (Strengthening Privacy) Bill 2018, as amended. The question is that Australian Greens amendments (1) and (2) on sheet 8565 be agreed to.

Senator DI NATALE (Victoria—Leader of the Australian Greens) (09:31): Regarding the amendments proposed on sheet 8565, I seek leave to withdraw amendment (2) and I intend to proceed with amendment (1). This is based on some advice that clarifies that the amendment will address the issue of 14- to 17-year-olds.

Leave granted.

Senator POLLEY (Tasmania) (09:32): Labor will support the amendment. The government concedes that parental access to My Health Records of people aged 14 to 17 is problematic. They have promised a review of this issue, basically saying, 'Trust us; we'll fix this later.' But, given the government's complete bungling of the opt-out period, Labor doesn't trust that assurance. The amendment moved by the Greens was proposed by the Royal Australian College of General Practitioners. The GPs say that it's important to move to ensure the trust of young patients, and Labor will support it. But this amendment addresses only one issue in the government's opt-out scheme.

Today we have seen alarming new reports that a range of health providers will be able to access Australians' most sensitive health information on My Health Record. This could include whether Australians are impotent or have a sexually transmitted disease or an alcohol or drug issue. Labor has been calling for a Privacy Commissioner review of the default access settings for weeks, but the government has stubbornly refused to act, just as they stubbornly refused to act on the opt-out period until yesterday. Now that the government has backflipped on the opt-out period, they should backflip on these concerns and order an urgent Privacy Commissioner review.

Senator STEELE-JOHN (Western Australia) (09:33): When you go to the doctor, when you engage with a healthcare professional, and you are a young person, you have a right to privacy. You have a right to know that the things you discuss of a highly personal nature will be kept between the two of you. This trust that exists between patient and practitioner enables many private, sensitive issues to be discussed. The legislation as drafted wholly failed to protect young people in this regard and to enshrine our right to privacy. It would have enabled health records to be shared automatically with parents or guardians, placing young people at significant risk of information, such as that relating to the disclosure of abuse and to the requirement to access sexual health services, mental health services and reproductive health services, being shared. It would have put all of that at risk and enabled it to be shared with a parent or guardian. It was a travesty, and the youth sector rightly came together and demanded that something be done.

I support this amendment wholeheartedly. I am proud to be a member of the movement that has brought it into being here today. We must always ensure that the right of young people to privacy is protected; that, when our information is accessed, our active consent is first sought so that trust can be maintained; and that rights are preserved. Thank you very much.

The CHAIR: The question is that the amendment as amended by Senator Di Natale, (1) on sheet 8565, be agreed to.

Question agreed to.

Senator SCULLION (Northern Territory—Minister for Indigenous Affairs and Leader of The Nationals in the Senate) (09:36): I table a supplementary explanatory memorandum relating to the government amendments to be moved in this bill.

Senator POLLEY (Tasmania) (09:37): Chair, we welcome the fact that the government has followed Labor's lead on these amendments. When Labor initiated the Senate inquiry into the My Health Record, the health minister dismissed it as a stunt. But the inquiry demonstrated the need for these six amendments, and Labor proposed them more than a month ago. The government announced last week that it would back down and make these amendments to its own bill, but, as usual when it comes to My Health Record, the government has bungled these amendments. The government's proposed restrictions only apply to national system employees, a definition that excludes state public sector and local governments. And, despite the government saying that they would ban employers from requesting or requiring My Health Record information, these amendments don't actually do that. So we will be moving further changes to the government's amendments.

Can I clarify with the government that those amendments that you put with the memorandum of understanding relate to those six government amendments?

Senator SCULLION (Northern Territory—Minister for Indigenous Affairs and Leader of The Nationals in the Senate) (09:38): They do indeed, Senator. I'm sorry, it has been difficult through the process to actually put that. It was in front of me yesterday but we didn't have time. There should be a copy in front of you very shortly. They are indeed; they do relate exactly to the amendments on, I think, sheet 5840.

The CHAIR: Minister, if I may assist the process: you need to actually move the amendments.

Senator SCULLION: I move those amendments. I think they relate—at least yesterday—to sheet 5840.

The CHAIR: No, I believe, Minister, what you're seeking to do is move amendments (1) to (8) on sheet EH276. We can go to other senators, if you want to seek clarification.

Senator SCULLION: Certainly. I've actually been seeking the sheet number.

Senator GRIFF (South Australia) (09:39): by leave—I move amendments (1) to (4) on revised sheet 8539 together:

(1) Schedule 1, item 6, page 4 (line 16), omit "or 69A".

(2) Schedule 1, item 7, page 4 (lines 20 and 21), omit the item.

(3) Schedule 1, item 12, page 5 (line 9) to page 8 (line 19), to be opposed.

(4) Schedule 1, item 16, page 8 (line 32) to page 9 (line 3), omit all the words from and including "sufficient certainty" to the end of subsection 70(3A), substitute "sufficient certainty to initiate consideration of the matter or concerns".

Senator POLLEY (Tasmania) (09:39): The government has bungled the opt-out period badly and lost the trust and confidence of the Australian people in My Health Record. This Centre Alliance amendment is an effort to restore that trust and confidence by limiting the use of the record to health purposes. However, Labor accepts that in very limited circumstances access to My Health Records may be needed by law enforcement or other government agencies. Labor is also satisfied that the government's changes, which require a court order for that access to occur, are appropriate protections, so Labor will not be supporting this amendment.

The CHAIR: The question is that the amendments, as moved by Senator Griff, on sheet 8539 be agreed to.

Question negatived.

Senator SCULLION (Northern Territory—Minister for Indigenous Affairs and Leader of The Nationals in the Senate) (09:40): by leave—I move government amendments (1) to (8) on sheet EH276 together:

(1) Clause 2, page 2 (table), omit the table (including the note), substitute:

Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.

(2) Schedule 1, page 3 (before line 4), before item 1, insert:

1AA Section 3

   After "national", insert "public".

1AB Section 4

   After "system is a", insert "national public".

(3) Schedule 1, page 3 (after line 5), after item 1, insert:

1A Section 5

   Insert:

   national system employer has the same meaning as in the Fair Work Act 2009, disregarding sections 30D and 30N of that Act.

   prohibited purpose has the meaning given by section 70A.

1B After subsection 6 ( 1 )

   Insert:

   (1A) Despite subsection (1), a person who has parental responsibility for a healthcare recipient aged under 18 is not the authorised representative of the healthcare recipient if the System Operator is satisfied that:

   (a) under a court order or a law of the Commonwealth or a State or Territory, the person must be supervised while spending time with the healthcare recipient; or

   (b) the life, health or safety of the healthcare recipient or another person would be put at risk if the person were the authorised representative of the healthcare recipient.

1C Subsection 6 ( 2 )

   After "If there is no person who the System Operator is satisfied has parental responsibility for a healthcare recipient aged under 18,", insert "or the only such persons are covered by subsection (1A),".

1D At the end of subsection 7 ( 2 )

   Add:

Note: Despite this subsection, a nominated representative must not use information for a prohibited purpose within the meaning of section 70A (even though a healthcare recipient may do so): see subsections 59A(2), 70B(2), 71A(4) and 71B(3).

1E After section 15

   Insert:

16 Research or public health purposes

      The System Operator's function under paragraph 15(ma) does not include providing de‑identified data to a private health insurer (within the meaning of the Private Health Insurance Act 2007) or any other insurer.

(4) Schedule 1, item 6, page 4 (after line 19), after subsection 17(4), insert:

   (5) To avoid doubt, if the System Operator is required under subsection (3) to destroy a record that includes health information, the System Operator must also destroy the following:

   (a) any copy of the record;

   (b) any previous version of the record;

(c) any back‑up version of the record.

(5) Schedule 1, page 4 (after line 19), after item 6, insert:

6A Subsection 59 ( 3 ) (penalty)

   Repeal the penalty, substitute:

Penalty:   Imprisonment for 5 years or 300 penalty units, or both.

6B Subsection 59 ( 4 ) (penalty)

   Repeal the penalty, substitute:

Civil penalty:   1,500 penalty units.

6C After section 59

   Insert:

59A Unauthorised use of information included in a healthcare recipient ' s My Health Record for prohibited purpose

   (1) A person must not use health information included in a healthcare recipient's My Health Record for a prohibited purpose, if the person obtained the information by using or gaining access to the My Health Record system.

Note: For prohibited purpose, see section 70A.

Civil penalty:   1,500 penalty units.

   (2) Subsection (1) does not apply if the person is the healthcare recipient, but does apply if the person is the nominated representative of the healthcare recipient (despite subsection 7(2)).

6D Subsection 60 ( 3 ) (penalty)

   Repeal the penalty, substitute:

Penalty:   Imprisonment for 5 years or 300 penalty units, or both.

6E Subsection 60 ( 4 ) (penalty)

   Repeal the penalty, substitute:

Civil penalty:   1,500 penalty units.

(6) Schedule 1, page 9 (after line 3), after item 16, insert:

16A At the end of Division 2 of Part 4

   Add:

Subdivision C—Unauthorised use of information included in a healthcare recipient ' s My Health Record for prohibited purpose

70A Definition of prohibited purpose

   (1) Information included in a healthcare recipient's My Health Record is used for a prohibited purpose if the person who uses the information does so for any one or more of the following purposes:

   (a) the purpose of:

      (i) underwriting a contract of insurance that covers the healthcare recipient; or

      (ii) determining whether to enter into a contract of insurance that covers the healthcare recipient (whether alone or as a member of a class); or

      (iii) determining whether a contract of insurance covers the healthcare recipient in relation to a particular event; or

      (iv) a national system employer employing, or continuing or ceasing to employ, the healthcare recipient;

(b) a purpose prescribed by the regulations.

   (2) If the person uses information for purposes that include, or for a purpose that includes, a purpose mentioned in subsection (1), the person is taken to be using the information for a prohibited purpose.

   (3) To avoid doubt, use of information is not for a prohibited purpose if the use is solely for:

   (a) the purpose of providing healthcare to the healthcare recipient; or

   (b) purposes relating to the provision of indemnity cover for a healthcare provider.

   (4) If a fault element applies to an element of an offence or civil penalty provision involving a prohibited purpose within the meaning of subparagraph (1)(a)(iv), absolute liability applies to the element that the employer is a national system employer.

   (5) References in paragraph (1)(a) to insurance do not include State insurance that does not extend beyond the limits of the State concerned.

70B Use for prohibited purpose is unauthorised

   (1) Despite Subdivisions A and B, a person is not authorised under this Division to use health information included in a registered healthcare recipient's My Health Record for a prohibited purpose.

   (2) Subsection (1) does not apply if the person is the healthcare recipient, but does apply if the person is the nominated representative of the healthcare recipient (despite subsection 7(2)).

16B After Division 3 of Part 4

   Insert:

Division 3A—Offences and penalties in relation to use of My Health Record ‑derived information for prohibited purpose

71A Offence for use of My Health Record ‑derived information for prohibited purpose

   (1) A person commits an offence if:

   (a) the person uses information; and

   (b) the person does so for a prohibited purpose, and the person knows or is reckless as to that fact; and

(c) the information is health information; and

   (d) the information is or was included in a healthcare recipient's My Health Record; and

(e) the person is not the healthcare recipient.

Penalty:   Imprisonment for 5 years or 300 penalty units, or both.

   (2) Subsection (1) does not apply if the information was not collected from, and is not derived from a disclosure that was made by, a person who obtained the information by using or gaining access to the My Health Record system. For this purpose, it does not matter whether or not any collection or disclosure of the information was authorised under this Act or any other law.

Note: A defendant bears an evidential burden in relation to the matter in subsection (2): see subsection 13.3(3) of the Criminal Code.

   (3) Strict liability applies to paragraphs (1)(d) and (e).

Note: For strict liability, see section 6.1 of the Criminal Code.

   (4) Despite paragraph (1)(e) and subsection 7(2), subsection (1) of this section applies to a person who is the nominated representative of the healthcare recipient.

71B Civil penalty for use of My Health Record ‑derived information for prohibited purpose

   (1) A person must not use health information that is or was included in a healthcare recipient's My Health Record for a prohibited purpose.

Civil penalty:   1,500 penalty units.

   (2) Subsection (1) does not apply if the information was not collected from, and is not derived from a disclosure that was made by, a person who obtained the information by using or gaining access to the My Health Record system. For this purpose, it does not matter whether or not any collection or disclosure of the information was authorised under this Act or any other law.

Note: A person bears an evidential burden in relation to the matter in subsection (2): see section 96 of the Regulatory Powers (Standard Provisions) Act 2014.

   (3) Subsection (1) does not apply if the person is the healthcare recipient, but does apply if the person is the nominated representative of the healthcare recipient (despite subsection 7(2)).

16C Subsection 75 ( 2 ) (penalty)

   Repeal the penalty, substitute:

Civil penalty:   1,500 penalty units.

16D Section 76 (penalty)

   Repeal the penalty, substitute:

Civil penalty:   1,500 penalty units.

16E Subsection 77(2A) (penalty)

   Repeal the penalty, substitute:

Penalty:   Imprisonment for 5 years or 300 penalty units, or both.

16F Subsection 77(2B) (penalty)

   Repeal the penalty, substitute:

Civil penalty:   1,500 penalty units.

16G After subsection 97 ( 2 )

   Insert:

   (2A) However, the System Operator is not required to give notice of the decision to a person if the System Operator is satisfied that doing so would put at risk the life, health or safety of a person.

16H Paragraph 98 ( 1 ) (b)

   Omit "Medicare;", substitute "Medicare.".

16J Paragraph 98 ( 1 ) (c)

   Repeal the paragraph.

16K Subsection 105 ( 3 )

   After "disclosure of" (wherever occurring), insert "de‑identified data or".

16L After paragraph 105 ( 3 ) (b)

   Insert:

   (ba) in connection with insurance, other than State insurance that does not extend beyond the limits of the State concerned; or

16M Subsection 105 ( 4 )

   After "disclosure of", insert "de‑identified data or".

(7) Schedule 1, item 17, page 9 (after line 12), at the end of the item, add:

   (3) The amendments made by items 6C, 16A and 16B of this Schedule apply in relation to the use of information after this Schedule commences, regardless of whether the information was collected before or after that commencement.

(8) Page 9 (after line 12), at the end of the Bill, add:

Schedule 2—Amendments commencing on Proclamation

My Health Records Act 2012

1 Section 5

   Insert:

   data custodian means the Australian Institute of Health and Welfare.

2 Paragraph 15(ma)

   Repeal the paragraph, substitute:

   (ma) in accordance with the guidance and direction of the Board established under section 82, to prepare and provide de‑identified data, and, with the consent of the healthcare recipient, health information, for research or public health purposes;

3 Section 16

   After "de‑identified data", insert "or health information".

4 Part 5 (heading)

   After "Other", insert "offences and".

5 After section 77

   Insert:

77A Enforceable requirements in My Health Records Rules must not be contravened: offence

   (1) An entity commits an offence if:

   (a) the entity does an act or omits to do an act; and

   (b) the result is that the entity contravenes a requirement imposed on the entity by My Health Records Rules made for the purposes of subsection 109(7A) and the entity is reckless as to that result; and

(c) the My Health Records Rules provide that the requirement is enforceable for the purposes of this paragraph; and

   (d) the entity is not the System Operator, the Data Governance Board established by section 82 or the data custodian.

Penalty:   100 penalty units.

   (2) Strict liability applies to paragraphs (1)(c) and (d).

Note: For strict liability, see section 6.1 of the Criminal Code.

6 Section 78 (at the end of the heading)

   Add ": civil penalty".

7 Section 78

   Before "A person", insert "(1)".

8 At the end of section 78

   Add:

   (2) An entity (other than the System Operator, the Data Governance Board established by section 82 or the data custodian) must not contravene a requirement imposed on the entity by My Health Records Rules made for the purposes of subsection 109(7A), if the My Health Records Rules provide that the requirement is enforceable for the purposes of this subsection.

Civil penalty:   100 penalty units.

9 After Part 6

   Insert:

Part 7—Data Governance Board

Division 1—Establishment and functions

82 Data Governance Board

      The Data Governance Board is established by this section.

83 Functions of the Board

   (1) The functions of the Data Governance Board are:

   (a) to oversee the operation of the framework prescribed by My Health Records Rules made for the purposes of subsection 109(7A), including by:

      (i) assessing applications for the collection, use or disclosure of de‑identified data and health information for research or public health purposes; and

      (ii) guiding and directing the System Operator in the performance of its function under paragraph 15(ma) (preparing and providing de‑identified data and health information); and

      (iii) taking steps to ensure the ongoing protection of de‑identified data and health information used by, or disclosed to, persons for research or public health purposes and that the data and information is being used and disclosed only for those purposes; and

(b) any other functions conferred on the Board by this Act or the My Health Records Rules.

   (2) The Board does not have any functions, and must not perform any role, in relation to the day‑to‑day operation of the My Health Record system.

Division 2—Membership

84 Membership

      The Data Governance Board consists of the following members:

   (a) the Chair of the Data Governance Board;

   (b) the Deputy Chair of the Data Governance Board;

(c) at least 7, and no more than 10, other members.

85 Appointment of members

   (1) Members are to be appointed by the Minister by written instrument, on a part‑time basis.

   (2) The Minister must appoint one member to be the Chair and another member to be the Deputy Chair.

86 Qualifications and experience

   (1) The Minister must appoint the following as members:

   (a) a person who represents the System Operator;

   (b) a person who represents the data custodian;

(c) a person who is an Aboriginal person or a Torres Strait Islander.

   (2) A person (including a person appointed in accordance with subsection (1)) is not eligible for appointment as a member of the Data Governance Board unless the person has skills or experience in, or knowledge of, one or more of the following fields:

   (a) population health and epidemiology;

   (b) medical or health research;

(c) health services delivery;

   (d) technology;

(e) data science;

   (f) data governance;

(g) privacy;

   (h) consumer advocacy.

87 Acting appointments

   (1) The Minister may, by written instrument, appoint a person to act as the Chair:

   (a) during a vacancy in the office of Chair (whether or not an appointment has previously been made to the office); or

   (b) during any period, or during all periods, when the Chair:

      (i) is absent from duty or from Australia; or

      (ii) is, for any reason, unable to perform the duties of the office.

Note: For rules that apply to acting appointments, see sections 33AB and 33A of the Acts Interpretation Act 1901.

   (2) The Minister may, by written instrument, appoint a person to act as the Deputy Chair:

   (a) during a vacancy in the office of Deputy Chair (whether or not an appointment has previously been made to the office); or

   (b) during any period, or during all periods, when the Deputy Chair:

      (i) is absent from duty or from Australia; or

      (ii) is, for any reason, unable to perform the duties of the office.

Note: For rules that apply to acting appointments, see sections 33AB and 33A of the Acts Interpretation Act 1901.

88 Term of appointment and other terms and conditions

   (1) A member of the Data Governance Board holds office for the period specified in the instrument of appointment. The period must not exceed 5 years.

   (2) A member of the Data Governance Board holds office on the terms and conditions (if any) in relation to matters not covered by this Part that are determined by the Minister.

89 Remuneration

   (1) A member of the Data Governance Board is to be paid the remuneration that is determined by the Remuneration Tribunal. If no determination of that remuneration by the Tribunal is in operation, the member is to be paid the remuneration that is prescribed by an instrument made under subsection (4).

   (2) A member is to be paid the allowances that are prescribed by an instrument made under subsection (4).

   (3) This section has effect subject to the Remuneration Tribunal Act 1973.

   (4) The Minister may, by legislative instrument, prescribe:

   (a) remuneration for the purposes of subsection (1); and

   (b) allowances for the purposes of subsection (2).

90 Resignation

   (1) A member of the Data Governance Board may resign the member's appointment by giving the Minister a written resignation.

   (2) The resignation takes effect on the day it is received by the Minister or, if a later day is specified in the resignation, on that later day.

91 Termination of appointment

   (1) The Minister may terminate the appointment of a member of the Data Governance Board:

   (a) for misbehaviour; or

   (b) if the member is unable to perform the duties of the member's office because of physical or mental incapacity.

   (2) The Minister may terminate the appointment of a member of the Data Governance Board if:

   (a) the member:

      (i) becomes bankrupt; or

      (ii) applies to take the benefit of any law for the relief of bankrupt or insolvent debtors; or

      (iii) compounds with the member's creditors; or

      (iv) makes an assignment of the member's remuneration for the benefit of the member's creditors; or

(b) the member is absent, except on leave of absence, from 3 consecutive meetings of the Board; or

   (c) the member engages in paid work (within the meaning of section 93) that, in the Minister's opinion, conflicts or could conflict with the proper performance of the member's duties (see section 93); or

(d) the member fails, without reasonable excuse, to comply with section 29 of the Public Governance, Performance and Accountability Act 2013 (which deals with the duty to disclose interests) or rules made for the purposes of that section.

92 Leave of absence

      The Minister may grant leave of absence to anymember of the Data Governance Board on the terms and conditions that the Minister determines.

93 Other paid work

   (1) A member of the Data Governance Board must not engage in any paid work that, in the Minister's opinion, conflicts or could conflict with the proper performance of the member's duties.

   (2) In subsection (1):

   paid work means work for financial gain or reward (whether as an employee, a self‑employed person or otherwise).

Division 3—Meetings of the Data Governance Board

94 Convening meetings

   (1) The Data Governance Board must hold such meetings as are necessary for the efficient performance of its functions.

   (2) The Chair of the Data Governance Board:

   (a) may convene a meeting at any time; and

   (b) must convene a meeting within 30 days after receiving a written request to do so from another member of the Board.

95 Presiding at meetings

   (1) The Chairof theData Governance Boardmust preside at all meetings at which the Chair is present.

   (2) If the Chairis not present at a meeting at which the Deputy Chair is present, the Deputy Chair must preside.

   (3) If neither the Chair nor the Deputy Chair is present at a meeting, the other members present must appoint one of themselves to preside.

96 Quorum

   (1) At a meeting of the Data Governance Board, a quorum is constituted by a majority of members of the Board.

   (2) However, if:

   (a) a member of the Board is required by rules made for the purposes of section 29 of the Public Governance, Performance and Accountability Act 2013 not to be present during the deliberations, or to take part in any decision, of the Board with respect to a particular matter; and

   (b) when the member leaves the meeting concerned there is no longer a quorum present;

the remaining members at the meeting constitute a quorum for the purpose of any deliberation or decision at that meeting with respect to that matter.

96A Voting at meetings

   (1) A question arising at a meeting of the Data Governance Board is to be determined by a majority of the votes of the members of the Board present and voting.

   (2) The person presiding at a meeting of the Board has a deliberative vote and, if the votes are equal, a casting vote.

96B Conduct of meetings

      The Data Governance Board may, subject to this Division, regulate proceedings at its meetings as it considers appropriate.

Note: Section 33B of the Acts Interpretation Act 1901 contains further information about the ways in which members of the Board may participate in meetings.

96C Minutes

      The Data Governance Board must keep minutes of its meetings.

96D Decisions without meetings

   (1) The Data Governance Board is taken to have made a decision at a meeting if:

   (a) without meeting, a majority of the members of the Board entitled to vote on the proposed decision indicate agreement with the decision; and

   (b) that agreement is indicated in accordance with the method determined by the Board under subsection (2); and

(c) all the memberswere informed of the proposed decision, or reasonable efforts were made to inform all the members of the proposed decision.

   (2) Subsection (1) applies only if the Board:

   (a) has determined that it may make decisions of that kind without meeting; and

   (b) has determined the method by which members are to indicate agreement with proposed decisions.

   (3) For the purposes of paragraph (1)(a), a memberis not entitled to vote on a proposed decision if the member would not have been entitled to vote on that proposal if the matter had been considered at a meeting of the Board.

   (4) The Board must keep a record of decisions made in accordance with this section.

Note: Section 33B of the Acts Interpretation Act 1901 contains further information about the ways in which members of the Board may participate in meetings.

Division 4—Other matters relating to the Data Governance Board

96E Relationship between System Operator and Data Governance Board in relation to data for research or public health purposes

   (1) In performing the function mentioned in paragraph 15(ma), the System Operator must comply with a direction from, and follow the guidance of, the Data Governance Board.

   (2) If rules made for the purposes of subsection 109(7A) require the Data Governance Board to take steps to ensure that de‑identified data and health information disclosed to persons for research or public health purposes is being used only for those purposes, the System Operator must not take any steps of its own to ensure that the data and information is being used only for those purposes.

   (3) Subsection (2) does not imply that the System Operator has a duty to take steps in relation to use of data and information at a time when there are no rules of the kind mentioned in subsection (2).

96F Board committees

   (1) The Data Governance Board may establish a committee or committees to assist in carrying out the functions of the Board.

   (2) The Board may dissolve a committee at any time.

   (3) The functions of a committee are as determined by the Board.

   (4) In performing its functions, a committee must comply with any directions given to the committee by the Board.

   (5) A question arising at a meeting of a committee is to be determined by a majority of the votes of committee members present.

   (6) A committee must inform the other members of the Board of its decisions.

   (7) A committee may regulate proceedings at its meetings as it considers appropriate.

   (8) A committee must ensure that minutes of its meetings are kept.

96G Delegation of functions

   (1) If the Secretary of the Department consents to the Data Governance Board delegating functions to APS employees in the Department, the Board may delegate any or all of its functions to such an APS employee.

Note: Sections 34AA to 34A of the Acts Interpretation Act 1901 contain provisions relating to delegations.

   (2) If the chief executive officer (however described) of the data custodian consents to the Board delegating functions to members of the staff mentioned in subsection 19(1) of the Australian Institute of Health and Welfare Act 1987, the Board may delegate all or any of its functions to such a member of staff.

Note: Sections 34AA to 34A of the Acts Interpretation Act 1901 contain provisions relating to delegations.

   (3) In performing a delegated function or exercising a delegated power, the delegate must comply with any written directions of the Board.

   (4) The delegation continues in force despite a change in the membership of the Board.

   (5) The delegation may be varied or revoked by the Board (whether or not there has been a change in the membership of the Board).

96H Annual report

   (1) As soon as practicable after the end of each financial year, the Data Governance Board must prepare and give a report to the Minister, for presentation to the Parliament, on the Board's activities during the financial year.

Note: See also section 34C of the Acts Interpretation Act 1901, which contains extra rules about annual reports.

   (2) A report on the Department's activities given under section 46 of the Public Governance, Performance and Accountability Act 2013 does not need to include a report on the activities of the Board.

96J Board is part of the Department

      For the purposes of paragraph (a) of the definition of Department of State in section 8 of the Public Governance, Performance and Accountability Act 2013, the Data Governance Board is prescribed in relation to the Department.

10 Subsection 105 ( 2 )

   After "System Operator", insert ", Data Governance Board and data custodian".

11 After paragraph 105 ( 6 ) (a)

   Insert:

   (aa) the Data Governance Board;

   (ab) the data custodian;

12 Subsection 109(7A)

   Repeal the subsection, substitute:

My Health Records Rules may relate to research or public health purposes

   (7A) The My Health Records Rules may, in accordance with section 109A, prescribe a framework to guide the collection, use and disclosure of de‑identified data and, with the consent of healthcare recipients, health information, for research or public health purposes.

13 Subsection 109 ( 9 )

   Omit "the My Health Records Rules", substitute "My Health Records Rules made for purposes other than subsection (7A)".

14 After section 109

   Insert:

109A My Health Records Rules relating to data for research or public health purposes

Examples of what the rules may do

   (1) Without limiting subsection 109(7A), My Health Records Rules made for the purposes of that subsection (the rules) may do any or all of the following:

   (a) impose requirements on the System Operator, the Data Governance Board established by section 82, the data custodian and other entities, including procedures that must be followed, in relation to preparing, providing, collecting, accessing, using and disclosing health information and de‑identified data;

   (b) provide that any or all such requirements are enforceable for the purposes of paragraph 77A(1)(c) or subsection 78(2);

(c) make provision in relation to the performance of the Board's functions set out in paragraph 83(1)(a);

   (d) authorise the Board to make written policies and guidelines to be followed by other entities for the purposes of giving effect to the prescribed framework.

Functions of data custodian

   (2) The data custodian has the following functions, and the rules may make provision in relation to the performance of those functions:

   (a) under the direction of the Data Governance Board and in accordance with this Act—helping to implement the prescribed framework by:

      (i) receiving de‑identified data and health information from the My Health Record system; and

      (ii) as necessary—de‑identifying health information; and

      (iii) as necessary—providing data linkage services (within the meaning of the rules); and

      (iv) preparing and providing de‑identified data and health information to users of data and information whose use has been approved by the Data Governance Board; and

      (v) ensuring that users of de‑identified data and health information are subject to conditions of use;

(b) any other functions conferred on the data custodian by this Act or the rules.

Limits on rules

   (3) The rules:

   (a) must not allow the health information of a healthcare recipient to be collected, used or disclosed otherwise than with the consent of the healthcare recipient; and

   (b) must not allow de‑identified data or health information to be provided to a private health insurer (within the meaning of the Private Health Insurance Act 2007) or any other insurer (with or without the consent of the healthcare recipient); and

(c) must not provide that any of the following is enforceable for the purposes of paragraph 77A(1)(c) or subsection 78(2):

      (i) a provision of a policy, guideline or other instrument made under the rules;

      (ii) a provision of the rules that requires an entity to comply with such a policy, guideline or instrument.

Constitutional limits on rules

   (4) If the rules make provision for the disclosure of de‑identified data or health information obtained by using or gaining access to the My Health Record system, the rules must have the effect that the data or information is to be disclosed only:

   (a) by means of a postal, telegraphic, telephonic or other like service; or

   (b) by or to a corporation to which paragraph 51(xx) of the Constitution applies; or

(c) by or to a person within a Territory or a place acquired by the Commonwealth for a public purpose; or

   (d) by or to the Commonwealth or an authority of the Commonwealth.

   (5) The rules may make other provision in relation to de‑identified data or health information only:

   (a) to ensure that collection, use and disclosure of data or information does not result in an interference with privacy of the kind the Commonwealth has international obligations to protect against, including under the International Covenant on Civil and Political Rights (in particular Article 17 of the Covenant); or

Note: The text of the Covenant is set out in Australian Treaty Series 1980 No. 23 ([1980] ATS 23). In 2018, a text of a Covenant in the Australian Treaties Series was accessible through the Australian Treaties Library on the AustLII website (http://www.austlii.edu.au).

(b) for purposes related to collecting, preparing, analysing or publishing statistics; or

   (c) by providing for data or information to be collected from or by, used by or disclosed by or to, any of the following:

      (i) a corporation to which paragraph 51(xx) of the Constitution applies;

      (ii) a person within a Territory or a place acquired by the Commonwealth for a public purpose;

      (iii) the Commonwealth or an authority of the Commonwealth.

Senator POLLEY (Tasmania) (09:41): I've made comments previously on the government's amendments, and I now move our amendments relating to those.

The CHAIR: Which amendments are these? Senator Bernardi.

Senator Bernardi: I was just seeking the call after the amendments had been moved by the government. I wonder whether they'd be in a position to explain what these amendments actually do.

The CHAIR: Yes, we're just in the process of Senator Polley moving amendments, so I think we might deal with that.

Senator Bernardi: I was seeking the call before because the government had moved amendments and I wanted to know, from the minister, what the amendments actually were.

The CHAIR: Yes, and we'll come back to that. We're just in the process of doing that. I will get Senator Polley to finish what she started, and then we'll see if the government wants to respond to the question you've just asked.

Senator POLLEY: I move amendments on sheet 8574, circulated in my name:

(1) Amendment (3), item 1A, omit the definition of national system employer.

(2) Amendment (6), item 16A, subparagraph 70A(1)(a)(iv), omit "a national system employer", substitute "an employer".

(3) Amendment (6), item 16A, omit subsection 70A(4).

(4) Amendment (6), item 16A, at the end of section 70A, add:

   (6) For the purposes of this section, using information for a purpose includes requesting or requiring the information for that purpose.

(5) Amendment (6), item 16B, before section 71A, insert:

71AA Definitions

      In this Division:

   My Health Record of a healthcare recipient includes a My Health Record of the healthcare recipient that has been cancelled or suspended.

   use information for a purpose includes request or require the information for that purpose.

The CHAIR: Senator Bernardi, would you like to put your question now?

Senator BERNARDI (South Australia) (09:42): My question simply was: when the original amendments were moved—

The CHAIR: Are these the ones on sheet EH276?

Senator BERNARDI: That's the point: I don't know, because I don't have it in front of me. I'm interested in asking the minister, who has moved some amendments, for a brief explanation of what the amendments actually do. Then I will ask the same question of Senator Polley—what her amendments actually do to the government's amendments. This is in the interest of clarification, because I don't have the complete information in front of me.

Senator SCULLION (Northern Territory—Minister for Indigenous Affairs and Leader of The Nationals in the Senate) (09:42): I thank Senator Bernardi for the invitation to make a contribution on these amendments. There are two amendments. The first is to remove the ability of the system operator—that's actually the Australian Digital Health Agency—to disclose information to law enforcement agencies and other government bodies without a court order or the consumer's express consent. This is actually consistent with the Australian Digital Health Agency's current policy position, which has remained unchanged and has resulted in no My Health Records being disclosed under such circumstances. We did deal, a moment ago, with the Centre Alliance amendment. Whilst it wasn't supported, they intended to delete the new sections 69A and 69B, which deal with very narrow confines under which a court order can be made.

The second element of those amendments is going to require the Australian Digital Health Agency to permanently delete health information it holds for any consumer who has cancelled their My Health Record. This makes it clear that, if a person chooses to cancel at any time, their record will be deleted completely and forever. The new amendments are as follows. Particular concerns have been raised regarding the potential for domestic violence to occur. As a result of that, for example, a parent may be able to access a child's My Health Record and get access to information on where the mum has moved to with the child. The government recognise that this is a serious matter, so we've put in a range of safeguards. There are a series of safeguards already in place in the system. These amendments will apply if a person has parental responsibility or if a person's access to the child is subject to supervision. This isn't intended if the court decides that you have access to 60:40 periods of time. It's only when there are particular supervision circumstances, so they only get access to the child in supervised circumstances. This would be taken into consideration. It also applies if the Australian Digital Health Agency considers that they may pose a risk, so there may be other circumstances where access to this information may pose a risk. This is ensuring that that person can't get access to the child's My Health Record.

The amendments will also provide greater clarity that My Health Records cannot be used for insurance or employment purposes. We've had a lot of discussion about that. This just provides some clarification. It will prohibit an employer from requesting or using health information in an individual's My Health Record, protecting employees and potential employees from any discriminatory use or use of their My Health Record. Information can be obtained from a My Health Record by healthcare providers and individuals. These amendments will also ensure that information derived from the My Health Record system cannot be used for insurance or employment purposes, regardless of where it is being viewed or stored. This will be one of the prohibited uses. This prohibition will apply to any activity for insurance or employment purposes, regardless of whether it is considered to be for the purposes of providing health care. For example, a healthcare provider undertaking a health assessment of an individual for employment purposes, which sometimes happens, would be expressly prohibited from using the individual's My Health Record or from using information that has been derived from that.

Through these amendments we'll also be increasing the maximum penalty levels for breaches of key privacy protections. This was an expressed recommendation of the Senate Community Affairs Legislation Committee. The maximum penalty level is just under double: in broad terms, I think for a corporation it is up to $1.5 million and five years imprisonment and for an individual it is $315,000. In any event, we have reflected the recommendations of the Senate inquiry. These penalty levels are now the maximum penalty levels for breaches of key privacy protections. They will be associated with any misuse of a person's health information obtained by unauthorised access to the My Health Record system or taking My Health Record information outside of Australia. Effectively, for example, if you downloaded something, printed a hard copy, took it outside of Australia and sold it outside of Australia, you wouldn't be subject to Australia's laws in that regard, so that prohibition about taking information outside of Australia ensures that you cannot take those My Health Records out of Australia. But if you were in London, for example, and went to a doctor or practitioner, you could still get access to the benefits of your My Health Record.

This will result in much stronger penalties for persons who collect, use or disclose health information if they are not authorised to do so. An individual who knowingly misuses a person's health information contained in their My Health Record will now face up to five years in jail and a maximum penalty of $315,000. Without going into too much detail, secondary use—if you tell someone something and they use it—is exactly the same; there is not a diminished penalty. The penalty remains at the maximum for the secondary person who obtains information from a prohibited act; they are subject to the same penalties. These increases in penalties acknowledge that as the system grows it will contain a larger volume of health information that needs to have the appropriate level of security. We think these safeguards are appropriate. The amendments also make clear that if a person chooses to cancel their My Health Record at any time it will be deleted permanently, including any backups, saved copies or the like.

In May this year the minister released the framework for the secondary use of the My Health system data, and now these amendments, as I indicated earlier, provide a legislative basis to support another tier of the appropriate use of My Health data for research and public health purposes. The amendments also remove the ability of the Australian Digital Health Agency to provide identified or de-identified information to the private health insurers and other types of insurers for research or for public health purposes. For the purposes of clarity: we're removing the ability that currently exists in de-identified form, to ensure that any of the data cannot be provided to insurers for research and public health purposes. They'll also provide that the minister's rule-making power will include the ability to specify requirements that apply to entities handling information for research and public health purposes, and set out processes for seeking to use or deciding to disclose this de-identified information. The amendments will also remove the ability of the Australian Digital Health Agency to delegate its functions and powers to an entity other than the Department of Health and the chief executive, Medicare. Such functions are delegated as appropriate to ensure the effective management of the system.

Finally, the government remains committed to the My Health Record system being government owned and operated. There was some talk about what would happen if we sold it. Are these same processes going to be in place? We are committed to this being government owned and operated as a national health asset, and the legislation clearly and unequivocally reflects this position. As a package, these amendments comprehensively address the concerns that have been raised by the public and in the Senate inquiries, and enhance the safety and privacy protections in the My Health Record system. The My Health record system will provide significant health and economic benefits for all Australians through avoided hospital admissions, fewer adverse drug events, reduced duplication of tests, better coordination of care for people seeing multiple healthcare providers and better informed treatment decisions. We're committed to this system because it is changing health care in Australia for the better, and we're equally committed to the privacy of the individual's health information. These measures strengthen the privacy protections and demonstrate this commitment.

I thank all senators who have made a significant contribution through the Senate inquiry and through this process. I commend the amendments to the house.

Senator BERNARDI (South Australia) (09:53): I understand Senator Polley has some amendments, and I would be interested in a brief explanation of how they alter this. Minister, if I could have your attention for a second, could the government indicate whether they are generally supportive of Senator Polley's amendments to your amendments? That would be of assistance too.

Senator SCULLION (Northern Territory—Minister for Indigenous Affairs and Leader of The Nationals in the Senate) (09:53): Without verballing Senator Polley, my understanding is that we're agreeing to a minor wording amendment. We think it improves our amendment. I think we're about to move to that amendment now. But the amendment in substance is just a stronger wording of the same amendment.

Senator POLLEY (Tasmania) (09:53): To assist Senator Bernardi: from the outset this government has bungled the process. The amendments that have just been moved by the government were in fact ones that we have been pushing hard on. But, even though they have attempted to pick up our concerns, as usual they have continued to bungle the process. The government's proposed restrictions only apply to national system employers, a definition that excludes state public sectors and local governments. Despite the government saying that they would ban employees from requesting or requiring My Health information, these amendments don't actually do that. That's why we have moved in our amendments a further amendment to strengthen the concerns that we have and why I moved that we take sheet 8574, circulated in my name. We do appreciate the fact that the government has finally got on board in supporting our amendments and proposing the ones that they did and that, at the end of the day, they've followed the lead of Labor on this very important initiative.

Senator SCULLION (Northern Territory—Minister for Indigenous Affairs and Leader of The Nationals in the Senate) (09:54): As I indicated earlier, we'll be supporting the opposition's amendments. We think they're actually omitting the definition of the national system employer, and they simplify and clarify the language, which is consistent with the government's policy intent.

The CHAIR: The question is that opposition amendments (1) to (5) on sheet 8574, which are amendments to the government amendments on sheet EH276, be agreed to.

Question agreed to.

The CHAIR: The question now is that government amendments (1) to (8) on sheet EH276, as amended, be agreed to.

Question agreed to.

Bill, as amended, agreed to.

Bill reported with amendments; report adopted.

Senator SCULLION (Northern Territory—Minister for Indigenous Affairs and Leader of The Nationals in the Senate) (09:56): I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Senator FARRELL (South Australia—Deputy Leader of the Opposition in the Senate) (09:57): I rise to speak on behalf of the opposition in respect of the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017. Almost two years ago—in fact, 716 days ago—I introduced, on behalf of the opposition, legislation into the Senate to ban foreign donations from our political system. In doing so, I reiterated Labor's belief that political donations from foreign sources are eroding our political system and that urgent action is required to address this. After our own legislation here in the Senate was not supported by the government, my leader, Bill Shorten, Leader of the Australian Labor Party, sought to progress this urgent reform in the other place, yet again to no avail. Unable to convince the government that they should outlaw foreign donations, Labor took action. Over six months ago, Labor voluntarily committed to refusing any and all foreign donations. We recognise the importance of the issue, and we didn't need legislation to act. We acted not because we had to but because it was the right thing to do. While I hope to see the swift passage of this legislation today, I call upon the Prime Minister to instruct the Liberal Party to stop taking any and all foreign donations: stop now—not one cent more.

I'm of the view that foreign donations are eroding faith in our democracy, are compromising our representatives and must be stopped. We must accept that the world around us is changing. We operate in a different era, a time of government sponsored hacking attacks and assassinations on foreign soil. We go about our business in the era of fake news campaigns and in an environment that has seen clear attempts by foreign powers to influence those in this chamber and the other. We're in an era of social media campaigns that can be launched within minutes, be funded from anywhere and reach millions of voters. Labor recognise that we must do all we can to combat these external threats to Australian democracy and our democratic institutions. Donations that seek to influence our political system are not only a threat to our electoral system but also a threat to the public faith in our democracy. Our democratic integrity rests not only on the fact that we do the right thing but also that we are seen to be doing the right thing. The Australian public are watching the controversies occurring in other established democracies around the world and wondering why our own elected representatives aren't doing more to protect our system and to protect our democracy.

Labor believes that the time for action is now. We believe that we have an opportunity in this place to finally prohibit foreign money from influencing our political system—and it is not an opportunity we intend to ignore. Almost two years after Labor moved to ban foreign donations, the government has finally presented the final version of the ban on foreign donations which is before the Senate today. The opposition will be supporting this legislation with the various and lengthy amendments we have requested, which have subsequently been listed by the government. We will also be moving a second reading amendment to this legislation with our commitment to lower the disclosure threshold for political donations.

There is broad consensus that we need more transparency around the money that supports political activity in our system. Reducing the disclosure threshold to $1,000 is Labor policy and it has been for a long time. We understand the important of greater financial accountability and we are going to act on that. If we form government, this is a policy we would look to implement, and we would do so with proper consultative process. We understand that there would be a range of entities that would want to have a say on how best to implement greater transparency around a lower threshold. We have shown throughout our consultation around the current Electoral Act amendments that we value the input of many different voices, and we would undertake that process in exactly the same vein.

Labor is of the view that the disclosure threshold of $13,800 is too high. Electors have the right to know who is donating to political parties. We must shine the light on who is making political donations and who is seeking to support a political outcome. Labor has been clear on our plan for reform. We took to the last election a proposal designed to, firstly, ban foreign donations; secondly, reduce the disclosure threshold; thirdly, ban donation splitting intended to avoid disclosure; fourthly, ban the receipt of anonymous donations above $50, fifthly, link public funding to campaign expenditure; and, finally, introduce new offences and increased penalties for breaches of the electoral law. Labor is still committed to taking the commitment to transparency further and has already committed to work towards a system of real-time donation disclosure.

Returning to the bill before us today: the government's approach seeks to define and prohibit a class of foreign donors. It seeks to create an offence within the Commonwealth Electoral Act for anyone seeking to influence our elections through donations or gifts from foreign sources and extends that offence to those wilfully receiving them. In Labor's original legislation we sought to define the money itself, reflecting the difficulty in prohibiting foreign donations in a globalised system. Although approached differently through this bill, the intent is the same: to prohibit those seeking to influence Australian voters from using foreign sources of funding—in particular, foreign states or state owned enterprises.

Although the opposition is today supporting this legislation, with those aforementioned amendments, this process has not been an easy one. The first draft of the bill contains some of the largest unnecessary overreach ever encountered in our political system. The government's first attempt, as the Senate would be aware, captured charities, not-for-profits, advocacy groups, churches, community organisations and single issue campaigners in a web of bans, hurdles and regulatory tape. Rather than focus on the substantive issues of foreign money, the government sought to wage a war on civil society and community organisations.

However, the government did achieve something quite remarkable—and that was to unite everybody from GetUp! to the Institute of Public Affairs, and everybody in between, against their legislation. That was no easy feat and it is one we should acknowledge on their behalf. The original legislation caused such significant unrest within civil society that our trusted charities and not-for-profits created the Hands Off Our Charities Alliance to combat these proposed changes. Such was the opposition to the first iteration of the bill that a number of organisations demanded that it be opposed outright, refusing to believe that amendments could be made to satisfy their concerns. As it was my belief, and that of the opposition, that a ban on foreign donations was a necessary and urgent reform, Labor decided to engage with the government constructively and present an opportunity to fix its legislation.

The bill was referred to the Joint Standing Committee on Electoral Matters, not once but twice—once to review the bill and the second time to review the proposed changes. Both times, the members of JSCEM worked diligently to engage across the parliamentary and various sectors to make recommendations for reform. I would particularly like to acknowledge the Labor members on JSCEM—Mr Andrew Giles; Mr Milton Dick; Senator Ketter, who is sitting behind me; and Senator Brown—for their service on those inquiries. I'll also mention the work that my staff, particularly Ben Rillo, did in respect of the JSCEM committee.

Following the second review by JSCEM, Labor worked continuously with the office of the minister to ensure that remaining community concerns were addressed and the appropriate amendments made. I will speak further on the government amendments in the course of the committee stage, but there are two key commitments that I believe are integral to restoring faith within the civil society sector. The first is a clearer and more concise definition of what is considered to be an electoral matter. This definition, acting as the gateway to the Commonwealth Electoral Act, should not capture legitimate public policy advocacy and should not be reserved for those seeking to influence a voter or the result of an election. The second is a guaranteed review of the practical operation of the legislation by the Joint Standing Committee on Electoral Matters. It's vital that any future government be held to the promise that the operation of this bill will be evaluated by that bipartisan committee and, if necessary, any further changes made.

I'd like to formally acknowledge and thank those members of the organisations and charities which placed their trust in Labor to negotiate amendments and worked constructively with us to review any changes. Today, the integrity of our democracy can be taken a step forward. Today, we can achieve one more step in protecting the very governance of our country and restore some faith in the eyes of the Australian public. I urge all senators to support the bill and the associated government amendments to finally achieve a ban on foreign donations.

I move:

At the end of the motion, add:

", but the Senate:

(a) supports increased transparency throughout our political system,

(b) notes the current threshold for disclosure of political donations is too high, at $10,000 (indexed to inflation); and

(c) believes the threshold for disclosure of political donations should be set at $1,000, not indexed to inflation."

Senator WATERS (Queensland) (10:07): I rise to speak on the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017.

This is a very complicated bill and it has certainly had a very chequered history. It purports to restrict the influence of foreign money over our politics. It doesn't actually achieve that very well. It's a small step forward, and we support those provisions, but it leaves massive loopholes which will allow big money to continue to influence our democracy. That is one of our main beefs with this bill: it's pretending to fix a real problem. It doesn't do a very good job and it ignores the influence of massive corporate donations that continue to flow into the coffers of both big parties. If this were a genuine attempt to clean up our democracy and to get that vested influence and interest by corporate interests and big money truly out of politics, then there would be support for the amendments that I will move to ban those corporate donations from listed vested interests, to cap donations to $1,000 for everybody else and to reduce that disclosure threshold.

When we get to moving those amendments I'll be very interested to see whether we have any real commitment to this issue by both of the big parties. I'm not expecting that they'll support those amendments, because this isn't a real attempt to clean up democracy; this is an attempt to look like they're both doing something while they're still taking the money from the big corporates. The Australian people aren't going to be fooled by this. They know that the so-called reason for this bill, the money that former senator Sam Dastyari accepted from Chinese nationals, would not have been stopped if this bill had been in place. This bill does not stop the very thing that it purports to be introduced for. This is a bill that wants to look like it's doing something while, in fact, it is still letting big money run this place. I think Australians will know that and they will be really disappointed that there is a pretence of addressing an issue while, actually, the real influence of money will continue unabated, and both of the big parties will be very happy with that situation. That is our first concern with this bill.

I rely on the advice of Professor Anne Twomey, a noted constitutional law expert who gave evidence into the multiple hearings in the inquiry into this bill. Professor Twomey said:

Foreign nationals can still, under this bill, make enormous and influential donations to political parties, if it is done through a permanent resident or a foreign-owned corporation or a subsidiary that is incorporated in Australia.

There are loopholes so big in this supposed crackdown on foreign donations that it will effectively be business as usual. We accept this is a small step forward but we are incredibly disappointed that the loopholes are so big that this won't actually change the behaviour of the big parties from accepting dirty money from vested interests who want policy outcomes to inflate their own bottom lines. Our democracy has been taken over by corporate interests. Both of the big parties have sold out to their donors. They are not making decisions in the interests of Australians anymore; they are making decisions in the interests of those people who have bought their support and who pay for their re-election campaigns. I think that is an abrogation of our democratic duty, and it is the single biggest issue people raise with me when I am back in my own home state or elsewhere around the country.

People want their democracy back. They are sick of feeling unheard and they are sick of feeling like their opinion doesn't matter anymore and that the decisions made in this place aren't for them, certainly don't help them and often make their lives harder. They can see decisions that make it easier for big polluters. They can see decisions that make it easier for big companies to increase their profit bottom lines. They also see decisions that crack down on people that are already below the poverty line, decisions that make life harder for people, decisions that don't put a roof over the heads of people who are homeless, that don't help women escaping violence to stay safe and keep their children safe, that don't make it easier for people to get a decent education no matter what their bank balance is, that don't put more hospital beds in place. They see those decisions not being made and they see decisions being made that simply make a few rich companies even richer. They know it is because those companies donate to both of these political parties and they know it is because some of the people who sit in these benches will go and work for those very interest groups once they leave parliament. The Australian people know about the cosy relationship between lobbyists, industry and this parliament, and they are fed up. We hear them and we share that view. So that is our first concern with this bill: it's pretending to fix a problem; it doesn't fix that problem and that problem still remains.

The second tranche of this bill deals with a massive increase in red tape on the charity sector. I also accept that this bill has improved. The bill has gone through so many iterations that the charity sector has been thoroughly overwhelmed, and I think it is deliberate. It is hard now to work out precisely what the obligations on those charities will be and it will take more of their scarce resources to work out what those obligations are. I think that is the intent because that will have the effect of silencing them from doing the otherwise very strong advocacy that they are incorporated to do and that they exist to do.

I am concerned that the sheer weight of regulation and its uncertainty will have that chilling effect on charities and not-for-profits doing their important advocacy work. We spoke a lot about this issue in the inquiry hearings into this bill. We do not have clarity on where the distinction lies between permissible advocacy on an issue that charities are formed to deal with, something that relates to their charitable purpose, their whole existence and reason for existence. It is still impossible to tell, and lawyers differ on where the line lies between that legitimate, permitted advocacy and somehow making an implied political comment in the context of an election campaign. It is now hard for not-for-profits to know when they can continue to campaign on an issue—alleviation of poverty, protection of bushland, protection of our oceans. Whatever the issue might be, they don't know if they are allowed to campaign on that in an election context. For example, where one party has a good policy position and another party doesn't, those charities don't know if talking about that is now going to be considered political activity, for which there is this mound of administrative obligations about where their donations are from and when they have to disclose them and what checks they have got to do when all of that regulation and red tape kick in. So, what do you think they'll do? They won't take the risk. They will shut up and they will stop that valuable advocacy work that improves the quality of our democratic debate and advances the public interest.

Charities aren't formed for private interests. The not-for-profit sector is called the not-for-profit sector for a reason. They are not there to advance their own interests or their own profits; they are there to work in the public interest, and their advocacy should be cherished and fostered in a robust democracy. Instead, this bill sneaks in a massive level of regulation that will be very difficult for small not-for-profits and charities to comply with. They are already stretched. They have already faced five years of unfair scrutiny beyond the scrutiny that any other sector is receiving—and I know my colleague Senator Siewert has been tracking this and will speak very passionately about it.

The government has already put incredibly high obligations on the not-for-profit and charitable sector, which they are already complying with. They don't need another level of regulation. They're working in the public interest. They're trying to help people and the planet. Of course they have opinions on government policy, because this government has set to war with the community and the environment, often with the opposition saying absolutely nothing about it or being complicit. There is a strong role for charities and not-for-profits in our democracy, and these laws will make it harder for them to continue that role. Democracy once again will suffer, but I'm sure that's the intent. We'll be moving amendments to try to soften the blow that this will have on the sector. I acknowledge that the blow is smaller than it once was. It was initially a complete outrage; it is now just a massive administrative burden for little gain.

There are also some changes in this bill that relate to election funding. They will change the way that political parties operate and conduct their election campaigns and the way elections are funded. We here at the Greens think that corporate donations should not run our democracy. We support public funding of elections. We don't think that it should be about what favours you can promise your big donor once you're in government in order to get their donation to campaign for your own re-election or election. We don't think it should be about power and money; we think it should be about democracy, and we think those elections should be publicly funded. We'll be moving amendments that say that not only do we want to get rid of the influence of big money from politics but we think there should be election caps on spending. We should take that private money out of the whole process, we should have it publicly funded and we should make sure that people can't massively spam people's televisions, overspend and waste the money that they've been held hostage by their donors to. I'll go through in more detail what our amendments actually do. But we have here a bill that pretends to do something that it doesn't do very well and is actually just a back door to crack down on a sector that's been very inconvenient for the government, because it is criticising their woeful policies.

I want to come to our amendments. I formally move our second reading amendment on sheet 8545:

Leave out all words after "that", insert:

"the bill be withdrawn because the Senate is of the opinion that:

(a) the bill ignores corporate influence over politics and disproportionately targets the not-for-profit sector, which is an attack on public interest advocacy;

(b) the bill is likely to discourage charities from engaging in issue-based advocacy in furtherance of their charitable purposes, because of uncertainty in the definition of 'electoral matter';

(c) there is no public interest benefit to the proposed added layer of regulation for the charitable sector, because the existing regulatory framework for not-for-profit organisations under the Charities Act 2013 is sufficient to prevent charitable organisations from engaging in partisan political activities; and

(d) the Commonwealth Electoral Act 1918 should be amended to introduce caps on campaign expenditure by political parties, candidates and associated entities, which are indexed to inflation and subject to periodic review."

We think this bill completely ignores the corporate influence over politics and disproportionately targets the not-for-profit sector, which, as I've said, is an attack on public interest advocacy. We think, because of the uncertainty in the definitions of 'electoral matter', 'implied political comment' and 'advocacy', it will have a chilling effect on not-for-profits and charities speaking out. The government know this, and they haven't fixed it. One wonders whether this is simply a deliberate attack in a long line of attacks on the charities sector. We don't think there's any need for another layer of regulation for the sector because the existing frameworks—the ACNC, the Charities Act—are already sufficient to prevent charities from engaging in partisan political activities. That is already prohibited. What this layer of regulation does is simply stifle advocacy.

As I mentioned already, we think that the electoral laws should be amended to introduce caps on expenditure by political parties, candidates and associated entities. That is our second reading amendment. But we also have some detailed amendments once we get to the committee stage. Chief amongst those is ending the influence of vested interests over our politics. We propose to ban donations from the following sectors: property developers, mining, tobacco, alcohol, gambling, banking, big pharma and defence.

People don't give money to political parties just because they've got nothing better to do with their money. They give money because they want policy outcomes that suit them. They give money because they want policies that will allow them to make more money. It is a very cosy relationship. If you look at the fossil fuel donations, for example, that big coal, big gas and big oil have given to both sides of politics over the last few years and then you look at the policy outcomes that this parliament has delivered for that vested interest, it is very hard to conclude anything other than that this is policy for donations. We were going to have a resource superprofits tax. A Prime Minister got rolled and we ended up with a weaker mining tax. That tax, of course, was then abolished anyway.

There have been so many times when the community has come together and demanded a certain policy, a certain regulation, and there has been that expectation, and then industry has rallied and has pressured the people in this building and, hey presto, the parliament's gone to water and nothing's been done. Perhaps it is the threat of the removal of those donations. Perhaps it is the threat that, if you make a fuss on the issue, you won't get the cushy job after you leave parliament: 'Just sit quietly, otherwise we won't give you that handshake once you leave.' It is about time we got rid of those big vested interests and their influence over our democracy. They have no place in decision-making. Decisions should be made for the benefit of the community. There is no reason for big money in politics. So we would like to completely end the donations from those sectors that I have listed.

The other important reform is that we think donations from everybody else should be capped. We're not just saying that there are a few sectors that we disagree with and that we want to silence them; we actually think that big money doesn't belong in politics. So our next amendment says that we want to cap donations from everybody. We don't care who you are or where you're from; we want to cap your donations at $1,000 per year. You can still make that small contribution, but that is not sufficient to buy a policy outcome. You can still exercise your constitutional right to free speech by donating a small amount if you want to back that cause, but we don't think that's an amount that would be sufficient to buy unfair political influence. And we think that should apply across the board to absolutely everyone. I don't expect that we will get support for that amendment either, because these two parties are hooked on the money from their donors. They are put here by them; they stay here because of that money. They are certainly not going to dry up that money source now. But the Australian people actually want that, and they deserve that. I am proud that the Greens will be moving those amendments.

Our amendments also talk about disclosure. We want to reduce the disclosure threshold to $1,000. I believe that Labor have a similar amendment, and I'm pleased to see that. We'll be supporting their amendment; I assume they'll be supporting ours. We're not sure which amendment will come on first, but that reduction of the disclosure threshold is such an important transparency measure. I've said that we think donations should only be $1,000; ergo, the disclosure threshold is the same as the cap, but I don't expect that our cap will get through. What might get through is that reduction of the disclosure threshold, and I hope that this chamber sees fit to accept that transparency as a principle is an important, crucial bedrock of our democracy. I look forward to that amendment being moved and being debated.

What I'm interested in, though, is whether our amendment for real-time disclosure of donations will get any support. We know it's Labor policy; it's been our policy forever. We know Labor have said that's something that they support, but are they going to vote for it? It's very easy to say you believe in something, but you've actually got to come in here and vote for it if your belief is to mean anything. I think the Australian community will be watching very closely just how legit the other parties are being in this place when it comes to that amendment about real-time disclosure.

I want to harken back to the fact that we've had a few by-elections lately, as people will know. Because of the existing disclosure rules, not only will people face the next federal election without knowing who's donating to the parties at that campaign; they won't even know who donated to the political parties in those by-elections. The voters of Wentworth, for example, don't know who funded the parties' campaigns in Wentworth, they're not going to know who's going to fund those candidates' campaigns as they face the next election and they still won't know who funded the last ones. Because of that delay in disclosure, there is a pall over who's really in charge, and the Australian community, of course, draw the worst conclusion. That conclusion is usually right: that it's the donors' interests that are being put ahead of the community's.

Real-time disclosure, folks. Let's actually be open and transparent. Let the people see where you're getting your money from, and then let them decide whether they think that's a good or bad thing and vote accordingly. But don't hide it. Don't try to pretend that it's not happening. Everybody knows what's going on. They can see that the interests that are being put first in this place are not the community's interests, and certainly not the environment's interests; they're the interests of the people who have made donations. They want to know who's donating to those political parties. Real-time disclosure is the least we can do for the Australian public to clean up our democracy.

I want to mention one final issue, that there have been so many drafts of this bill. In one of the earlier drafts thrown upon us—out of nowhere—was this notion that the federal laws might be able to be used to override recent state donation bans. I'm from Queensland, where our state government, under pressure from the Greens in our state election, finally brought in laws—which we support, which are great and we think they're good—to clamp down on donations from property developers. Of course, we think they should go further, and we'll be moving amendments to do that. Certainly our member, Michael Berkman, has done that. But it was a small step forward and we support it.

The federal government—very cross about that, because, of course, they get an awful lot of money from property developers—want to try to find a way to override those laws. So they lobbed in provisions to an earlier draft of this bill that would simply override that Queensland property developer ban. They were very open about that at the time. Senator James McGrath, who was caretaking this bill in the course of the JSCEM hearings, is quoted on record as saying that was the very intent. They have since resiled, a little, from that. I understand they've come under some pressure from the Labor Party to do that—certainly, we've made our position known: we don't think it's right that those state bans be overridden by the federal laws—and I understand the drafting has the opposition benches comfortable. But we have advice that says that the drafting of those amendments will still let people get around that Queensland property developer donation ban. We are not satisfied that the drafting closes that loophole, and we cannot support that provision.

I will be moving amendments that say that those state bans should remain; this parliament should not be seeking to overturn those. I am hopeful that maybe we'll get some reform today or when this bill comes to a vote, but our amendments would significantly strengthen this bill, would help clean up our democracy and could restore the confidence of the Australian people. (Time expired)

The ACTING DEPUTY PRESIDENT ( Senator Sterle ): Before I go to Senator Reynolds, I need to clarify for the Senate, so there's no confusion: you did say that you would be moving second reading amendments. You don't need to. Senator Farrell already moved that earlier, so we don't need to do it twice.

Senator WATERS: Sorry, I foreshadowed our party's own second reading amendments. Thank you.

Senator REYNOLDS (Western Australia—Assistant Minister for Home Affairs) (10:28): I too rise to speak in support of the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017. I would start by making the observation that, while most Australians would agree that only Australians should have the power to influence the outcome of our national elections, Australia is one of the few Western democracies where foreign money can still be used to influence our own domestic elections.

The introduction of this bill was in response to the Joint Standing Committee on Electoral Matters Second interim report on the inquiry into the conduct of the 2016 federal election: foreign donations. I was very privileged and proud to have chaired that committee and to have authored the report. One of the observations I make up front is that, despite broad consensus within Australia on the principle of banning foreign donations, there has been significant and also, I think, very important public debate as to who and what activities these bans should be applied to.

I think at the heart of this debate lies the fact that election campaigning today is very different from that in the mid-1980s, when the majority of the current provisions were written. There wasn't the internet, there wasn't the avenue of social media and there weren't many of the other things that go along with modern campaigning. The campaign period has, without question, moved well beyond the time in-between the issuing and the return of the election writs. Campaigning is now 24/7, 365 days a year. It goes for three years. Campaigning today is largely issues based. When I started campaigning, it was based on political party philosophies, policy promises and announcements. It is now far more issues based on issues that are longitudinal. Campaign messaging today is communicated via a wide range of mediums by a much wider range of entities, including charities, industry groups and also religious institutions.

I was delighted as chair of JSCEM that when the inquiry was conducted the government adopted the majority of the committee's 15 unanimous recommendations. I'd like to place on record my gratitude and thanks to all the members of the Joint Standing Committee on Electoral Matters. We went through what was a very difficult inquiry to come up with those unanimous recommendations. What was at the heart of all our deliberations was the fact that we needed very strong, transparent and very clear electoral laws that were in our sovereign interest. Despite significant public debate—sometimes quite fractious debate—the committee always remained focused on what was in our national interest and what was in the interest of all Australian voters. I think the report reflected that, and the government has adopted the majority of those recommendations.

Before I go any further on the detail of the bill that has flowed from that report, I note that I was sitting here listening to Senator Waters. I have to say that, despite the great respect I have for Senator Waters as a representative of her state, I think everything she said then demonstrates the need for this legislation. It reminded me of the debate and the discussions that we had in the committee and in public on this issue. Senator Waters was very clear on the Greens' position. They agree with the principles, but they just don't want them to apply to them and their own donors. The list of people she wanted banned from exercising a democratic right in this country to influence, get involved and have their say in elections includes industry which supports the coalition—banning industry from being able to donate or having donations capped—but she was completely silent on the donors who directly support the Greens and campaigned on issues for the Greens for three years in the lead-up to an election.

We heard a lot of evidence during the inquiry about Greens' supporters and, quite often, supporters of the Labor Party cause and Labor Party issues. We're not just talking about the unions and GetUp!, which openly and clearly support the Labor Party and frequently the Greens but, of course, never the coalition. What she was completely silent on are the environmental charities that have clearly—not even hidden but in plain sight—campaigned in support of the re-election of those opposite. Again, it is their right to do so, as long as they are not in breach of ACNC guidelines or in breach of the Electoral Act. During the inquiry, peak bodies of multiple charitable and philanthropic organisations admitted that many of those charitable organisations were in breach of the Electoral Act. In fact, they said that hundreds of supporters of the Greens, and occasionally the Labor Party, had been in breach of strict legislative requirements and strict liability requirements of the Electoral Act wilfully and in plain sight for years and years and years. They knew they had two obligations—the ACNC and the Electoral Act—so, guess what? The ACNC guidelines were much looser and enabled them to do a lot more on behalf of political parties in their campaigns. They chose to ignore the Electoral Act. A strict liability law is never acceptable and they should, I think, have been prosecuted for that, but they haven't been. In terms of hypocrisy, if the Greens were serious about applying the principles, they would apply them equally to their own donors and supporters.

What are the facts in this case? Well, according to their own published records, the top 10 environmental charities have had income of over $700 million over the past 10 years. I can tell you now, and I can tell everybody in this chamber and everybody listening, that the majority of that money, I suspect very strongly, does not go into saving koalas, panda bears and whales. It goes into domestic campaigns on issue advocacy that now moves well beyond issue advocacy into campaigning for the election of those opposite and, in particular, the Greens. At every election we now see ads from GetUp!, from the unions and also from environmental groups that are entirely consistent with each other and support Labor and Greens election policies. That is okay, but, again, it has to be transparent, it has to be visible and it has to be subject to the same electoral laws.

How this is relevant to this current debate is that a lot of the money that comes into these organisations is foreign money. It comes into larger charities that have international linkages with large, benevolent foundations. That money comes into this country, it is washed around these environmental groups and then suddenly it pops up in local campaigns against sitting MPs on environmental issues which, guess what, are exactly the same issues that the Greens and the Labor Party are campaigning on in the election. They have made those issues salient and relevant to the elections. It has been sourced, and washed around a bit, from foreign sources.

To the Greens I say, I'm sorry, but there is rank hypocrisy in saying, 'Yes, we want these laws to apply to this group of people who coincidentally all support the coalition and their policies, but we don't want all of our money touched, and we don't want that looked at because they're charities who are advocating for us, not campaigning for us.'

Senator Waters: That's the opposite of what we're proposing. We're prosing a cap on all donations.

Senator REYNOLDS: Well, let's call a spade a spade. This money is going to your re-election. For this side and our supporters who support our policies in the support of business, jobs, growth and all of the things that we stand for, you have to be honest enough to admit that this money is going to your re-election.

Senator Waters interjecting—

Senator REYNOLDS: There was $700 million in environmental groups alone.

The ACTING DEPUTY PRESIDENT ( Senator Sterle ): Senator Reynolds, can you please take your seat. Senator Waters, you had 20 minutes uninterrupted, and you didn't hold back on your attacks, so I would ask and urge that Senator Reynolds be heard in silence.

Senator REYNOLDS: Thank you for that courtesy. That is foreign money coming in—in my words and from my observations from the inquiry and all the evidence we had. To put it pretty simply: with the support that is completely not transparent—it is unaccountable under the Commonwealth Electoral Act and it is unaccountable under the ACNC guidance—this money means that, pretty much, all the Labor Party and, particularly, the Greens have to do at the next election is register their candidates as candidates for the election. Between GetUp!, between the unions and between these environmental groups that have no accountability in this election process and system, as all other donors do, you don't have to do anything. They are already out there running your campaign for you. They are already out there running the election messaging for you. You have to do nothing, and not a single cent of that is accountable.

Senator Waters interjecting—

Senator REYNOLDS: Senator Waters, if you don't believe that, you have a look at all of the election campaigning for the recent by-elections that occurred and how much of that expenditure has been made under the Commonwealth Electoral Act returns.

Senator Waters interjecting—

Senator REYNOLDS: It is not. So, therefore, you are benefitting from what the American equivalent of PACs and Super PACs is. Of course you want us and our donors to be exempt from this because you have somebody out there running all of your campaigns for you and funding them with foreign money. Of course you don't want this to happen.

Senator Scullion: On a point of order: we have listened in silence to a contribution that I would have made plenty of interjections on had I not respected the Senate. I wonder if you, Acting Deputy President Sterle, could ask Senator Waters to provide the same respect.

The ACTING DEPUTY PRESIDENT: Thank you, Senator Scullion. There is no point of order. I have already requested that Senator Reynolds be heard in silence.

Senator REYNOLDS: I'm not surprised that Senator Waters does not like what I have to say, because the truth hurts. There is nothing in what I have said that can be refuted publicly or privately, because it is all on the public record. This legislation is important to make the money that goes not just to those on this side of parliament and the people who support our policies but to all in this chamber and all in that other place. All of it must be subject to the same rules, the same transparency and the same guidelines. This is why I'm very supportive of the JSCEM recommendations that provide greater clarity for charities and also align definitions as closely as possible with the intent and principles of the bill. It is to put all of us and all of those who would seek to support us on the same footing. I think we've got the balance right between ensuring regulatory and compliance burdens are minimised for donors large and small.

One of the most important principles—even the Greens representative was very supportive of these principles that went into this report—is that Australian citizens must have visibility of who is seeking to influence their votes and must also have the confidence that foreigners are not seeking to influence the outcome of their votes. The committee's multipartisan deliberations on this issue, particularly through JSCEM, have been underpinned by some important national principles: national sovereignty, voter transparency and the preservation of democratic freedoms. Again, I think the 15 report recommendations, which are reflected throughout this bill, do reflect the principles of sovereignty, transparency and the preservation of our democratic freedoms and rights.

Committee members and the government also believe that reform to the Commonwealth Electoral Act should be consistent with four principles which have guided and continue to guide JSCEM: transparency, clarity, consistency, and also compliance—transparency via visible timely disclosure; clarity about what is required and by whom; consistency of regulations so that the regulations capture all participants and support an equitable and level playing field; and compliance through enforceable regulations with minimal practical compliance burdens. I commend the government because I believe those four principles are well and truly reflected in this bill.

With these comments I commend the government for their support of a new and easily accessible transparency register, which was a recommendation of the committee. This will provide voters with the ability to readily identify who is seeking to influence their vote. Again, this puts more power and control of their vote with the voters themselves. This register will also assist all third parties, particularly those not compliant with the current legislative requirements—of which, self-confessed, there are many—to better understand and now comply with the regulatory obligations. So I commend the government for their constructive response to the JSCEM recommendations and I strongly and wholeheartedly commend this bill to the Senate. It is the right thing for our country and for the upcoming elections.

Senator SIEWERT (Western Australia—Australian Greens Whip) (10:43): I rise also to make a contribution to the debate on the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2018. This, I consider, is a missed opportunity to finally introduce adequate transparency and integrity measures into our political system. It's a bill I've been following closely since it was introduced in December last year. In fact, I have been to a number of meetings about it. It's a great shame that the government has missed this opportunity to introduce real, long-lasting reform, because it is clear that we need to clean up our politics and our donations in this country. Australians' faith in our democracy is diminishing, unfortunately. They see donations coming from big business flowing to the Liberal, Labor and National parties and they can see that there are policy outcomes expected for those donations. Massive injections of cash from the fossil fuel industry have meant that Australia's governments for years and years have failed to take long-lasting, meaningful action on climate change, and, quite frankly, we are seeing the impacts right now today and into the future. On the other side, the ALP receives donations from the oil and gas industry and apparently has no interest in making gas companies pay royalties or tax on the millions and millions of dollars they are raking in. And, of course, we see the revolving door between politics and big business, which certainly does not help.

Right from the start, when this bill was introduced last year, it was clear that this legislation was not, in fact, as the government articulated, motivated solely by concerns about the influence of foreign money in this country. It was obvious that there were also other objectives and agendas. If they were seriously concerned about the influence of donations on our democracy in this country, why on earth hasn't the government moved and started in the most obvious place—putting caps on donations to all political parties and limiting expenditure to boot?

To address one of the issues that Senator Reynolds just brought up, having a shot at Senator Waters: we have amendments to cap all donations. Senator Reynolds—I hope she's still listening—we are in fact addressing the issue that you were so inaccurately trying to label the Greens as doing. And also, by the way, you labelled our charities and not-for-profit sector most inappropriately. In our set of amendments, we have a cap of $1,000 on all donations. So I'm really looking forward to seeing the government's support for our amendments and, in particular, Senator Reynolds's support for our amendments. This is about a coalition government determined to stifle civil society—and what better example do we have than the comments Senator Reynolds just made? She failed to differentiate between charities and not-for-profits, who provide so many valuable services to our community, and big business. And what do they want? They want to lobby for their own profits. I noticed that that point wasn't made by the senator. Beyond that, her facts about what the charities and not-for-profit sector does were plainly wrong.

This is about a government that clearly wants to silence those in civil society who work every day to make Australia better and to support some of the most vulnerable members of our community. The government doesn't like us raising issues that are uncomfortable for them. They don't like it when we do it in this place. They certainly don't like it when the broader community pushes back at them about their heartless policies on refugees and around their failure to take action on the policies that really count—such as addressing homelessness and the three million people living in poverty in this country. Those are the things that our charities and not-for-profits are working on.

When we first saw this legislation in December, it was obvious that this was about seriously constraining the work of a wide range of charities and not-for-profits by treating their work as politically partisan—and we just saw a classic example of that in this place. It would have forced some charities to choose between public advocacy and accepting international philanthropy. It would have tied up many charities in bureaucratic knots—even more than they have to do already—forcing them to detail political expenditure and their senior employees' membership of political parties. And it would have required a statutory declaration from any donor who cumulatively gives more than $250 annually, an onerous burden that certainly would have impacted charitable giving in this country. Was that the government's intent? That's certainly what it would have done. I've been in this place long enough to know that the coalition—ever since I first set foot in this chamber—has repeatedly tried to undermine charities and not-for-profits.

Having come straight from the not-for-profit sector into this chamber, from the first time I was in here, I knew what the government was up to; I saw very clearly. Having been on the other side, having worked in the not-for-profit sector for most of my career, I knew what they were up to, as did other people in this chamber. The coalition have been intent on gagging charities and not-for-profits, and have repeatedly tried to stop environmental organisations from doing their work—raising uncomfortable facts and trying to protect and arrest the decline, for example, of our endangered species, of which Australia has the unfortunate record of having the highest rate of mammalian species lost in critical weight ranges in the world. I come from a place in Western Australia which is one of the biodiversity hotspots on this planet—some of the species found there are found nowhere else—and I'll campaign to the last breath in my body to protect those species, as will many in community based organisations.

The community sector provides services to our community that the government fails to provide. They stand up for policy change. They don't just support and provide services to some of the most vulnerable members of our community but they also want to change the policy that leads to people being vulnerable in the first place. I know it's uncomfortable for the government when organisations tell the government they need to increase Newstart because, as it currently stands, it leads to people living in poverty. They don't like feeling that heat. They just want to support and make people's lives a little more comfortable when they're living in poverty; they don't want to hear the uncomfortable fact that people are living in poverty because of their policies. That's the fact.

The government wants all these changes, but the charities are already regulated by the Australian Charities and Not-for-profits Commission Act and the Australian Charities and Not-for-profits Commission that comes out of that act. Thankfully, the bill has now been amended to address many of the concerns of charities and other parts of civil society—after a long campaign, I've got to say—but it wasn't easy to achieve these changes through that campaign. Over the course of the last year, in the charities and civil society sector hundreds of hours and countless resources have been spent trying to make the government and the Labor Party see sense. The Hands off our Charities alliance and other charities have engaged in the inquiry process. They've spoken extensively to their members, they've hosted democracy sausage sizzles at Parliament House and they've spoken to as many members of this place as possible. The result is a bill that has, fortunately, been improved. The Greens, too, have worked tirelessly to try and make the government see sense in relation to this bill. I pay tribute to my former colleague Lee Rhiannon and to Senator Larissa Waters, who has taken up that portfolio, for the tireless work they have done on this legislation.

In addition to the concerns outlined by Senator Waters, the Greens still have misgivings about this bill as it relates to the charitable sector. We have seen amendments rushed through at the last minute without the time for proper scrutiny, and we are concerned that we will only realise down the track that charities and civil society do face an increased burden of administration that may stymie their important work. I'm deeply concerned about tying them up in red tape when we've been told that the government's trying to get rid of red tape. We know that this government, as I articulated and as we've just heard in this place this morning, sees civil society as playing partisan politics when, in fact, what civil society is trying to do is ensure that we have policies in this country that provide for a better society. We do not want to see civil society silenced, even though they do tell us uncomfortable facts. This is a democracy and they have the right to speak out. They have the right, in fact, under legislation, to be able to advocate.

We've heard the government's agenda, via Senator Reynolds, of trying to provide an excuse to shut down the work of charities which provide essential and valuable work for our communities. Charities and the not-for-profit sector advocate for better outcomes for our community. Whether it is trying to ensure that we don't suffer from the catastrophic impacts of climate change, whether it's ensuring that an oil spill from an accident from the offshore oil and gas industry doesn't impact irreversibly on our marine environment—in other words, ensuring that some of our most important marine environments are protected—whether it's campaigning to make sure that we have an increase in Newstart so that people aren't living in poverty, or whether it is ensuring that we're investing in research for better medical outcomes, that's all the work of civil society. Some organisations I can think of have raised illnesses that the government didn't think were illnesses and weren't on their agenda, and they are now on their agenda and getting the attention they deserve. Civil society organisations are the leaders in this country. They are the ones that lead change. They are the ones that drive change.

The Greens support our charities and not-for-profit sector. We do not want to see them stifled in red tape and gagged. Previously we have seen charities and the not-for-profit sector having contracts that gag them from speaking out if they take money from government. That is not appropriate for those organisations. It is obvious from the past, from those gag clauses, that it was definitely about providing those services and turning a blind eye to the policies that lead to you having to provide those services in the first place. Well, we won't stand for those changes. We are deeply concerned that, even with the changes that have been made, we may, in fact, see an adverse impact on the sector, and we will continue to monitor this extremely closely. This bill has been improved but it shouldn't have gotten to the point where the sector had to run such a campaign to get the changes to reverse this government's agenda.

Senator ABETZ (Tasmania) (10:58): Democracy is a delicate flower. It needs to be tended. It needs to be nurtured. It is, in fact, one of the crowning glories of our society and the reason that we are, literally, the envy of the world. Our democratic system needs to be protected, nurtured, tended, looked after, and we need to ensure that the regulations and legislation surrounding our democracy are up to date with the times to ensure that we protect it from inappropriate influences. That is why I support this bill.

There are, regrettably, cynical operatives who would seek to occasion damage to our wonderful democracy by undermining it through undesirable practices, and one of those is through foreign donations. Indeed, I have been on the record for many years opposing foreign donations. Indeed, one of my failures as Special Minister of State in a previous manifestation was not being able to convince my party of the need of such a reform. So, today, I am glad that other people have been a lot more successful than I was, all those years ago, when I was Special Minister of State, to be able to get this ban, hopefully, legislated very shortly, because I believe that the integrity of our democracy needs to be protected.

Democracy, as I said, is very fragile. It does rely on the goodwill of the Australian people. It only operates and is capable of operating if people have confidence that the system provides a fair representation of the will of the Australian people. If we have opportunists or, indeed, people with sinister motives seeking to influence the Australian body politic through foreign donations, we have a problem not only because it might undermine the results that come from our voting system but also because people would lose faith in our democratic system. To ensure that the Australian people can retain their faith in our democratic system we need to fine-tune it from time to time to ensure that that integrity is absolutely maintained.

We all know that there was one political party whose parliamentary leader personally negotiated the biggest donation ever in Australian political history. He personally negotiated it, which I think shows a huge lack of integrity. What's more, after the event the donor claimed that he believed that it was a good investment on his part and the beneficiary, the leader of that political party, said that he would be forever grateful. Those sorts of deals in our body politic reflect very badly on it.

I daresay nobody in this chamber needs to ask which political party I'm referring to. Indeed, it was the political party that continually lectures and harangues everybody else about integrity in the political system. You've guessed it. It was the Australian Greens, under the leadership of former senator Bob Brown, who personally negotiated that deal with Graeme Wood—a donation of $1.6 million. That has come to light. At the end of the day at least it was Australian money, but you can foresee with deals such as that that people from overseas might think that with extra money they can influence the Australian politic. Indeed, I submit to this chamber we saw a real live example of a person who, thankfully, is no longer in this place. That person sought to talk about our foreign affairs and issues in relation to the South China Sea in a bid to endear himself and potentially source donations from certain overseas interests. They are the sorts of influences that I believe we should seek to repel from the Australian body politic. They are blots on our political experience in this nation.

I confess that I would like to see some more changes to our electoral system because there are very sinister organisations within the body politic, such as GetUp!, which was initially funded by supporters who were funded by George Soros from overseas. I have given previous speeches in this place outlining the connections with the sinister organisation GetUp!, which makes false claim after false claim after false claim. I will give a few examples. In 2014 GetUp! sought to change its objectives that were lodged with ASIC. It falsely claimed that it was a charity. It put into its objectives that it was a charity—false, false, false.

For four years they continued with that falsehood, until I asked questions of ASIC at estimates as to how this was allowed to be, when GetUp! was not on the register of the ACNC and was not a tax-deductible organisation in relation to donations. What does this sinister organisation do? They simply say that it was an administrative error—an administrative error my foot! You do not deliberately seek to change your objectives by an accident. That requires a deliberate act. They have now, thankfully, altered their objectives, having been exposed for falsely portraying themselves as a charitable organisation.

With GetUp! we also had a situation in which those who believe in transparency—and absolutely demand transparency of any other organisation within the political realm—had the requirement within schedule 1 of their constitution that they would set out the names of all their members. Well, if you go to schedule 1, it is a blank sheet of paper. When I exposed this double standard, also at Senate estimates with ASIC, GetUp! said, 'Oh, it's just an administrative oversight; we're happy to provide the names.' What has happened in recent times? GetUp! have changed their constitution so that they are no longer required to display these unnamed people who secretly deal with GetUp! and pull the strings and manipulate GetUp! Rather than being an administrative error, such as accidentally making themselves a charity and accidentally leaving the names off schedule 1 of their constitution, they deliberately changed their constitution so that they wouldn't have to disclose the names. I wonder why! Might it be that the CFMEU or the Australian Workers' Union might be shown up on that schedule?

When there are organisations such as this within our body politic, I think we need to be alert, and I trust that the government and the Australian Electoral Commission will continue to monitor these types of organisations. Make no mistake: GetUp! is, as I said, sinister. In my own home state of Tasmania, at the last election they flew at least half a dozen operatives into the seat of Bass who went around claiming to be locals, doorknocking all day and making advocacy phone calls of a night, besmirching a great Australian hero, Andrew Nikolic, the member for Bass. Indeed, they went around with a video camera at one stage, following his spouse, his wife, down the street—a simple act of intimidation. These sorts of people do nothing for our parliamentary democracy and our democratic system of government. They then helped the Australian Labor Party with the most dishonest of campaigns: 'Mediscare'. We now know that to be false. But on election day, outside the polling booth in Scottsdale in north-east Tasmania, in the seat of Bass, there was a huge sign saying that the Liberal Party would cut the budget of the local hospital—by more than the total budget of that hospital! It was just a fabricated figure, dishonest in the extreme. But of course the local community, needing their local hospital, were shocked and horrified, and—you cannot blame them—they voted in the mistaken belief that they had to protect their local hospital. It was completely dishonest, a complete manipulation of our political system, which got GetUp! their desired result and saw Andrew Nikolic defeated in the seat of Bass. He is a man that former Prime Minister John Howard, on election night in 2016, named as the first person he regretted had been defeated in that election. He was highly regarded by former Prime Minister John Howard. Yet, these are the sorts of antics that have sadly developed in recent times in our body politic. If we want to protect our body politic, if we want to ensure that the Australian people are able to continue to have faith that the results of elections are a true reflection of the will of the Australian people, I think we need to ensure that those sorts of behaviours are stopped as well. I trust that in future, when the electoral legislation is considered by this place, we do have a look at those sorts of activities, because, if more organisations such as GetUp! continue to pollute the democratic framework of our nation, it will undermine the people's confidence in our system which has served us so extremely well now for over 100 years.

Organisations such as GetUp!, which was originally funded by donations from Mr Bill Shorten's union, the Australian Workers' Union—he did not seek to disclose this to his union membership, but, of course, Mr Shorten has been the beneficiary of GetUp!'s activities for his political ambitions. We have GetUp! allegedly asking its online supporters—alleged members—as to the issues they would want GetUp! to campaign on. When the Joint Standing Committee on Electoral Matters asked them, for the 2016 election, 'What was the result of that survey?' GetUp! wanted to refuse and did not come to the committee to tell them or answer the question. And, of course, what was it? It wasn't a surprise: it was the border protection issue that was of concern to GetUp! members. The issue of health funding and 'Mediscare' was, in fact, down the list. Yet, that is the issue on which GetUp! campaigned, along with—surprise, surprise!—the Australian Labor Party. This was at a time when GetUp! was still claiming full transparency: 'Oh, we accidentally overlooked the names of people on our schedule that we should have disclosed', and, 'Oh, we accidentally said that we were a charity'. No. When you have a look at the conduct of GetUp! from the get-go, right through, you know that they are a blot on our democracy. You know that they do a great disservice in our democratic system by misrepresenting, by manipulation and, indeed, by intimidation.

When we look at our electoral system, can I repeat: it is important that standards of integrity are maintained because otherwise people will lose confidence in the system. The bill that we're discussing, the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017, deals with one of those important aspects—that is, the banning of foreign donations. I think all Australians would agree that it should only be Australian money that impacts Australian elections and that people should have the capacity to be able to make their money available, for whatever civic-minded purpose, to assist their political party of choice. But if that money starts coming from overseas then one can be rightly concerned that that money might be for the purposes of determining an outcome within our body politic that is within the interests not of the Australian people but of a foreign entity or, indeed, a foreign country. If some of the allegations are correct in relation to influence of some of the bigger players within the political and international scene, be it Russia or China, then I think we are right, as a parliament, to legislate in relation to issues of foreign donations in our body politic.

I listened with some interest to Senator Siewert's contribution. I can understand the concern of some of the charities that was expressed on the original bill which, as a government that listens to the people, we were able to adjust to ensure that there were no unintended consequences. But let's also keep in mind that some of these so-called charities play a very loose and fast political game. I recall that in my home state of Tasmania some time ago a so-called charity was running TV advertisements encouraging people at the election to 'vote to protect the forests'. It was quite a lengthy advertisement on TV. It just happened that, within the same ad break, there were very short, sharp advertisements telling us that only the Greens would protect our forests. Oh—no collusion between the charitable organisation and the Greens political party; just coincidence! What happens is that, if you want to support the Greens political party, you donate to the charity and get a full tax deduction for your donation, knowing that they'll be using that money for a political advertisement, whereas, if you were to donate your money to the Greens for the political advertisement, you would not be getting the same tax deductibility. I think these things need to be looked at as well to ensure that there isn't this sort of manipulation—a wink, wink and a nod to each other. Indeed, whilst we expect that from the ACTU, the trade union movement and the Australian Labor Party, I think most people are attuned to the likelihood of that happening. But, when it happens with a charitable organisation that has certain status and, just coincidently, there are trailers in the ad breaks for a political party, I think there is something that also, in the future, may need to be addressed.

Suffice to say that this bill deals with the issue of foreign donations—something that I've been concerned about for some time and something that, whilst I was minister, I was unable to achieve. I'm delighted that brighter and better people have been able to get it through my party and, I trust, the parliament as well. It will be for the benefit of the Australian body politic to have this legislation passed, and I commend it to the Senate.

Senator LEYONHJELM (New South Wales) (11:17): Well, the fix is in. The Liberal government and the Labor opposition have done a deal to change electoral law. Under the smokescreen of preventing foreign donations, evidence about which the Joint Standing Committee on Electoral Matters could not find, they have struck a deal to implement changes that amount to a virtual de facto ban on small parties and independents. In conjunction with the changes to the system of Senate voting, the deal will see the disappearance, within a couple of elections, of any party or independent that has not yet consistently won four per cent of the vote or is not backed by a multimillionaire. It will mean the disappearance of parties that 22 out of 100 Australians vote for. I'm talking about parties like the Democratic Labour Party, the Australian Liberty Alliance, the Voluntary Euthanasia Party, the Health Australia Party, the Australian Christians, Drug Law Reform Australia, and the Republican Party. The Liberal-National coalition, Labor, the Greens and One Nation will continue to contest federal elections because they regularly win four per cent of the vote, giving them an entitlement to millions of dollars of taxpayers' money. Extremely wealthy Australians will be able to buy their way into politics via a minor party, including people like Clive Palmer, and two or three parties that win four per cent of the vote in their home state or have a presence in state parliaments may also continue to contest federal elections, but dozens of parties will disappear—literally dozens.

Seventy-eight out of 100 Australians voted for the Liberal-National coalition, Labor, the Greens or One Nation. Many of these Australians might not care if the parties they didn't vote for disappear from the ballot, but they should, because giving everyone an outlet to express their political opinion is in everyone's interests. Small parties that cannot reach the threshold required to achieve taxpayer funding on a predictable basis will not be able to survive today's change in electoral law, because today's change in electoral law will effectively require all parties to permanently employ lawyers and accountants if they want to be sure they comply with the piles of new red tape and avoid the new heavy penalties. But small parties cannot afford to employ lawyers and accountants any more than your local tennis club can. Once today's change in electoral law sinks in, only the most reckless of our smallest political parties will remain—or those with a very wealthy backer.

Let me outline some of the new red tape and new heavy penalties imposed by today's changes in electoral laws. Parties will need to provide an opportunity for donors donating less than $13,800 to affirm that they are not foreigners and will need to verify that donors donating more than $13,800 are not foreigners. Consider for a moment how your local tennis club would go about verifying that a donor is not a foreigner and you will begin to understand the problems to be faced by small political parties. Parties will need to return donations over $250 if they don't have the details of the donor. But how can you return a donation if you don't have the details of the donor? If you can't return the anonymous donation, you have to forward it to the government. Again, I ask those listening to ponder how your local tennis club would deal with this bizarre red tape—and for what benefit? What possible harm could come from receiving an anonymous donation of $251?

Parties will no longer receive around $2.70 of taxpayer funding per vote whenever they win four per cent of the vote. Instead, if a party wins four per cent of the vote, the party will receive either $2.70 per vote or an amount matching their expenditure at that election—whichever is lower. Perhaps this change would be fine if there were no four per cent hurdle for receiving taxpayer funding, but it is disastrous for small parties that sometimes win more than four per cent of the vote and sometimes don't. Currently when such parties win less than four per cent of the vote they make considerable losses, and when they win more than four per cent of the vote they can recoup those losses by receiving taxpayer funding in excess of their expenditure at that election. It more or less evens out. But, with today's change in electoral law, recouping losses will be impossible. Small parties will continue to incur considerable losses at some elections but won't be able to do more than break even at other elections, even when they receive funding. This will accelerate their departure from the political scene. Now, it is true that small parties shouldn't rely on taxpayer funding to keep afloat—indeed, the Liberal Democrats would prefer that all taxpayer funding was abolished—but it is undemocratic and despotic that major parties can rely on taxpayer funding to keep afloat but small parties cannot.

Today's changes in electoral law will require parties to keep records for five years. This might be easy for the Labor Party and the Liberal Party, with their well-established head offices and the continuity of staff, but for small parties that operate out of someone's garage it's a bridge too far. Today's changes in electoral law also quadruple fines on political parties, so a breach of electoral law will be punished with a fine of up to $42,000. This might be small change for the President of the Labor Party or the Liberal Party, but it is more than enough to deter potential volunteers from getting involving in running a small party.

If the threat of massive fines doesn't scare volunteers away then the publication of their names surely will. Today's changes in electoral law require the names of these volunteers who manage parties to be published. The presidents of the Labor Party and the Liberal Party won't mind their names being published, because their involvement is already public knowledge, but many everyday citizens who have non-political jobs and lives outside politics will balk at the idea that their political involvement will be advertised.

What's unforgivable about the piling of red tape and heavy penalties on small parties is that it is of no benefit. Foreign donations, which are a negligible part of party finances, will continue through indirect means. Incidents like the Sam Dastyari saga will still occur, because today's changes to electoral law don't affect donations received for personal gain. And parties will continue to withhold the details of donations over the disclosure threshold of $13,800, because the loophole of subsection 314AC(2) is conspicuously untouched by today's changes.

The fix is in. Today's changes to electoral law, stitched up by Labor and the Liberals, will corrupt our political system. Today's changes, together with the changed voting system, will see our Senate ballot voting papers eventually showing the Liberals or Liberal-National coalition, Labor, the Greens, possibly One Nation and not much else. No matter who wins government, the Greens or One Nation are very likely to hold the balance of power unless another Clive Palmer throws millions of dollars into a new campaign and breaks through, none of which is good for democracy and none of which either the Liberals or Labor should encourage or welcome. And 22 out of 100 voters will be disenfranchised, so political angst in this country will rise further, possibly to dangerous levels.

On behalf of the Liberal Democrats, I stand here to oppose today's changes to electoral law in the strongest possible terms.

The ACTING DEPUTY PRESIDENT ( Senator Bernardi ): Thank you, Senator Leyonhjelm. I do appreciate your offer to relieve me in the chair whilst I deliver my speech on the second reading. I thank the Senate for their indulgence.

The ACTING DEPUTY PRESIDENT ( Senator Leyonhjelm ): Following a magnificent speech, I call Senator Bernardi to make another magnificent speech!

Senator BERNARDI (South Australia) (11:28): I'm afraid I may disappoint you, Mr Acting Deputy President! I do rise to make a contribution to what I think is a very important debate and a very important change to our electoral laws. Notwithstanding Senator Leyonhjelm's contribution and concerns about some of the impacts that this is going to have on a minor party, as someone who is involved in a minor party I do ultimately welcome the bulk of these changes. It is going to make things more difficult and these are not perfect changes by any stretch, but they are a big step in the right direction. Electoral donation reform in this country is important. I don't think we should have foreign donors. I do believe that only individuals should be able to contribute to political parties. I think disclosure should be in real time, and, indeed, we will be moving an amendment in the committee stage to encourage parties to disclose on their websites those donations in excess of the threshold within 14 days and to notify the Electoral Commission.

In this respect, we put our money where our mouth is on behalf of the Australian conservatives. We are the only party, to my knowledge, that has in the two consecutive years we've existed lodged our disclosure return with the Australian Electoral Commission and published those figures on our website within weeks of being requested to do so. I think—and I'll stand corrected—that in this financial year we lodged our return within a week of the financial year closing. It is not difficult. It entails keeping accurate records during the course of a financial year. It means being diligent and applying rigorous accounting practices, as you would expect in any business, and particularly one that is entrusted with public money.

If you think we're just tinkering around the edges, in donations to the Australian Conservatives, there were circa 30,000 individual contributions in that 12-month period. The sums were in the region of $2.4 million. It's run with a minor staff, so you don't have to have a massive organisation in order to be able to acquit yourself in these circumstances appropriately. Having said that, there are challenges for smaller parties, and finance is one of them. There are huge advantages accrued to the big parties, not only in terms of public funding. They can predict the public funding that they expect to receive, and they can effectively borrow against that and spend accordingly in campaigns, which gives them a modicum of guaranteed success. That's because it's an inescapable law that marketing does attract votes. That is a concern if we are freezing out minor parties from making contributions or making it too difficult to contribute to the political process in a manner that I think many, many Australians would like to see. Senator Leyonhjelm said 22 out of 100 people voted outside of the major parties, and I suspect that will continue. We need to give them choice; we need to give them diversity of voices. Some of them will be successful and some will not, but that is the democratic process.

I come back to some other practical concerns. In the second reading debate, Senator Farrell mentioned that he wanted the disclosure threshold moved to $1,000, and we still have to vote on that. I support that amendment on the basis that it is Labor policy. But there's nothing, really, to be ashamed of. If someone wants to give an amount of money to a political organisation, having their name published is part and parcel, I think, of integrity and openness.

I share Senator Abetz's concerns about some of the—I will use the term 'quasi-political outfits', which are the campaign units and the political parties that do not nominate candidates but basically endorse other parties' candidates and work on their behalf and are not captured currently by the disclosure regime. Senator Abetz mentioned GetUp!, and I'm sure there are many environmental groups that are in that space and a range of other organisations as well. If people really want to get involved in the political discussions and political debate, I don't think we've got anything to fear. We've got to actually stop the manner in which soft dollars are getting into politics and influence. If you want to have an organisation that doesn't have to disclose funding or wants to pursue altruistic objectives, then I don't think they should be political-campaign organisations. Let them be training organisations, let them be charities, if that's what they want to do, and let them get involved in whatever sphere of community life they want to. But, if you want to get involved in politics and you want to advocate in that space in a public manner and try to influence elections or directly support candidates or political parties, I think you need to be captured by the process.

In the interest of giving Senator Griff a bit of time before we move onto other business, I recognise, and I want to put on the record, that this regime is not perfect at all. It is a step in the right direction. I don't doubt at all that it is self-serving for the major parties. I come back to the fact that we all know—or it's available on the AEC website and it's available on the Australian Conservatives website—how much money we received in the last financial year and who our donors in excess of the threshold were, and that's gone through all our divisions around the country. I regret that it will be after the next election that we will know who has tipped the money into the Liberal, Labor and Greens parties, because no-one has decided that they should be disclosing and be as clear and as up-front as my fledgling organisation have been. It is, quite frankly, a direct challenge to them that rapid disclosure is important. That is why, in the committee stage, I will be moving that donations in excess of the threshold should be published on the party's website and disclosed to the Electoral Commission within 14 days of receipt.

I commend the bill, and I hope it does get amended. I only wish that Senator Farrell had moved his amendment in the committee stage so we would know Labor are serious about reform rather than just looking after their own shameless interest.

Senator GRIFF (South Australia) (11:35): This bill is well and truly overdue. Frankly, it is only seeing the light of day due to public outrage over a system that encourages cash for favours, a system that has been creatively worked by the major parties over many years and a system that, with the passing of this legislation, will be tighter and have gone a good way towards passing the pub test.

As others in this chamber have already raised, the glaring omission in this bill is timely disclosure of donations, gifts and loans. Donors and financiers have influence; many demand influence. Currently it could take up to 18 months for returns to be made publicly available, but there is a need for the public to know who the influencers are in a more timely way, certainly during an election period. The fact that neither major party has moved to rectify this glaring omission shows the importance to them of keeping their big donors, and hence their big influencers, well and truly out of the picture until one of them has won the election and benefits from the spoils of office. Labor's $1,000 threshold amendment would have got through had they followed through with it, rather than wimping out and putting it up as a second reading amendment. Without doubt, it would have had an effect on limiting some influence—but not all influence. In the end, you and the Liberal Party want to play on the same team in the lead-up to the next election, the same team that accepts money for a degree of influence.

Centre Alliance is serious about giving the public more transparent disclosure of donations. At the very least, there must be a mechanism where the public can determine on a monthly basis the gifts and loans made to political parties and candidates, with the identity of donors and financiers over the threshold also being disclosed. Apart from real-time disclosure, which is our preferred option—and one that I expect will take place eventually and once the Electoral Commission has the capacity for it—monthly disclosure will go a long way to limit undue influence by putting it under the spotlight and allowing the public to have more confidence in the political system. I foreshadow that I will be moving an amendment to that effect that requires political entities and political campaigners to disclose the total value of all gifts on a monthly basis and to disclose the value of gifts and the name and address of the gift giver when that gift, or cumulative gifts, from that gift giver exceeds the threshold. The same, importantly, has to apply to loans. Financiers without doubt have influence, so it is important that their association with a candidate, party or campaigner is captured and made publicly available within 30 days as well.

There are many well-thought-out and valuable clauses in this bill. Political campaigners will now have to be registered and disclose their donations. Election expenditure will be reimbursed in a more equitable manner. Foreign donors will only be able to give up to $1,000—thought that is $1,000 at a time, I note, not in total. The bill is not perfect but it is a great start. But please let us ensure all parties and candidates are up-front and transparent with the public. By being up-front and transparent, undue influence is weakened. Support our amendment for 30-day disclosure and work towards real-time disclosure in the near future. This, and the changes proposed in this bill, will go a long way to restoring public confidence in the political system.

Senator HANSON (Queensland) (11:39): By all means, changes need to be made to the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017. Let's let the public know what electoral funding is. When an election is held, any party or candidate that receives over four per cent of the vote can apply for electoral funding. Federally, you do not have to disclose how much you've spent on your campaign. It is paid for by public funding, which is the taxpayer. At present, for the next election, the funding will be $2.75 per vote on the No. 1 vote. So whoever gets your No. 1 vote will get $2.75 if they get over four per cent of the vote. This was introduced in 1983 under the Hawke government. At that time there was reimbursement of 60c per vote in the House of Representatives and 30c per vote in the Senate of the amount the candidate or party spent on their election campaign—up to a certain amount.

By all means, electoral funding has helped political parties. But my understanding was that it was introduced to actually stop donations coming in. There was no bribery and you weren't corrupted by organisations, so politicians could make decisions that were not based on who gave them donations. Over the years, we've seen huge amounts of money come from organisations to the major political parties. Smaller parties like One Nation rely on membership fees or small donations from people that help us because they believe in our policies. So I can assure you that no big organisations donate to One Nation. It has been through hard work—having fish and chips at meetings or sausage sizzles. We find the big organisations donate to the major political parties. GetUp! and the unions back Labor and fund their campaigns. A lot of people don't know that the unions don't pay tax. Unions are tax-free organisations, so they're not taxed. They donate millions of dollars to the Labor Party to get their mates elected in this place. Then you have GetUp! as well, an organisation that is supposed to be a charity. They fund Labor as well. Really, they should be taxed and we should watch where their donations go. This measure is really going to rein people in. I also think that overseas money should not have an influence on our political scene, so I believe that foreign donations should be totally stopped. I do agree with that.

I notice that Senator Waters spoke about donations from the big organisations, but they say the donations they get are for the hip pocket for their businesses and the money they are going to make. In a lot of cases, the legislation that is made is not about what goes in their hip pocket; it's about saving jobs as well. This is where they say it's coming from the mining organisations. Let me go back to Adani. They will be indirectly employing about 10,000 people in the set-up of that mine and, on an ongoing basis, the mine will employ approximately 1,460 people. Queensland relies on mining for a lot of its budget. About $55 billion a year comes into the coffers of the Queensland state government through mining, so the royalties from mining are very important to Queensland. Mining is also very important because coking coal is used to make the best steel in the world, so we do need mining if we are going to have good-quality steel.

But it's okay for the Greens to receive their donations. Their donations are basically going to shut down mining—jobs gone; they want to shut down fishing—more jobs gone; and they want to shut down farming. So they're quite happy to take their donations to shut down these organisations. It's all right for them to get their electoral funding, but it's not all right for the other side. Let's be fair about this. I quite agree that, with donations that come into political parties, it's like you've got your cake and you want to eat it as well—you have political donations and then electoral funding.

The PRESIDENT: Senator Hanson, it being 11.45, you will be in continuation when the debate resumes.

Senator BUSHBY (Tasmania—Chief Government Whip in the Senate) (11:45): I present the 13th report of 2018 of the Selection of Bills Committee, and I seek leave to have the report incorporated in Hansard.

Leave granted.

The report read as follows—

Selection Of Bills Committee

REPORT NO. 13 OF 2018

1. The committee met in private session on Wednesday, 14 November 2018 at 7.12 pm.

2. The committee recommends that—

(a) the provisions of the Migration Amendment (Strengthening the Character Test) Bill 2018 be referred immediately to the Legal and Constitutional Affairs Legislation Committee for inquiry and report by 18 January 2019 (see appendix 1 for a statement of reasons for referral).

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

Discrimination Free Schools Bill 2018

Fair Work Amendment (Restoring Penalty Rates) Bill 2018 [No. 2]

National Housing Finance and Investment Corporation Amendment Bill 2018.

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

Agricultural and Veterinary Chemicals Legislation Amendment (Streamlining Regulation) Bill 2018

Australian Research Council Amendment (Ensuring Research Independence) Bill 2018

Customs Amendment (Peru-Australia Free Trade Agreement Implementation) Bill 2018

Customs Tariff Amendment (Peru-Australia Free Trade Agreement Implementation) Bill 2018

Parliamentary Joint Committee on the Australia Fund Bill 2018

Social Services Legislation Amendment (Ending the Poverty Trap) Bill 2018

Treasury Laws Amendment (Strengthening Corporate and Financial Sector Penalties) Bill 2018.

Appendix 1

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Migration Amendment (Strengthening the Character Test) Bill 2018

Reasons for referral/principal issues for consideration:

To provide further scrutiny on the impact of this bill on the Australian community

Possible submissions or evidence from:

Department of Home Affairs

New Zealand High Commission and relevant parties

Law Council of Australia and relevant legal representative bodies

Refugee Council of Australia and relevant refugee representative bodies

Other related organisations

Committee to which bill is to be referred:

Senate Legal and Constitutional Affairs Legislation Committee

Possible hearing date(s):

To be determined by the committee

Possible reporting date:

Friday, 18 January 201 9

Appendix 2

SELECTION OF BILLS COMMITTEE

Proposal to refer a bill to a committee

Name of bill:

Migration Amendment (Strengthening the Character Test) Bill 2018

Reasons for referral/principal issues for consideration:

This will lower an already low bar for refusing or cancelling the visas of non-citizens, for reasons such as sharing intimate images, verbally threatening someone, associating with members of a gang, or holding a rock in a threatening way.

Possible submissions or evidence from:

Law Council of Australia, Human Rights Law Centre, Civil Liberties Australia, Kaldor Centre for International Refugee Law, Refugee Advice and Casework Service, Immigration and Advice and Rights Centre, and Refugee and Immigration Legal Service.

Committee to which bill is to be referred:

Legal and Constitutional Affairs Legislation Committee

Possible hearing date(s):

December 12-13, 2018

Possible reporting date:

First sitting week of 2019

Senator BUSHBY: I thank the Senate and move:

That the report be adopted.

Question agreed to.

The PRESIDENT (11:48): I remind senators that the question may be put on any proposal at the request of any senator. There being none, we will move on.

Senator FARUQI (New South Wales) (12:41): I move:

That the following bill be introduced: A Bill for an Act to amend the Australian Research Council Act 2001, and for related purposes.

Question agreed to.

Senator FARUQI: 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 FARUQI (New South Wales) (12:42): I move:

That this bill be now read a second time.

I seek leave to table an explanatory memorandum relating to the bill.

Leave granted.

Senator FARUQI: I table an explanatory memorandum and seek leave to have the second reading speech incorporated in Hansard and to continue my remarks.

Leave granted.

The speech read as follows—

This Bill amends the Australian Research Council Act 2001 (ARC Act). The intent of the Bill is to remove Ministerial discretion from approving or rejecting research grants recommended and administered by the Australian Research Council (ARC). The ARC is established as an independent Commonwealth body under the ARC Act.

Currently, the Act gives the Minister the power approve or reject research grants that have been recommended by the ARC, including powers relating to the approval of expenditure on research programs, primarily sections 51–53 of the ARC Act (in Division 1 of Part 7). This Bill amends various provisions in the Act to remove the Minister's discretion to approve or reject a research proposal recommended by the ARC by providing that the Minister must approve a research proposal and the associated expenditure recommended by the ARC.

It is not remotely novel to suggest that academic research grant funding in Australia should be completely independent of the Government of the day. That is why today, I am introducing a Greens bill to amend the ARC Act to remove political interference from research.

This would mean that research projects, recommended by experts at the Australian Research Council, after a thorough vetting and peer review by the ARC, will be free from political and ideological interference.

No Minister should be able to dictate which research projects get funded and which ones don't. The true test of academic freedom is that it must be free from political interference, no matter who is in Government. It should be based only on an independent rigorous assessment process.

We know that this isn't currently true. It has been recently revealed that under this Government, former Education Minister, Senator Birmingham, vetoed eleven grants worth $4.2 million.

The reality is that it is entirely possible under the current system for the Minister to reject a research grant, which has been approved by the ARC, on almost any ground including disagreement with the subject matter or even the political leanings of the researcher. It is not hard to imagine that if we continue down this road, any number of research areas could be vetoed. If the Minister is a climate denier, defund all climate work. If the Minister is a coal hugger, defund all renewables work. If the Minister hates non-Western culture, bam there it goes.

We need to trust the research process. I was an academic for many years; I know getting an ARC grant is no easy thing. In 2017, the ARC approved only 18% of discovery grant applications and 17% of Discovery Early Career Researcher Awards. In 2018, only 20% of Future Fellowships applications were awarded.

Academics have a right to be supported in developing and maintaining their pursuit of research with freedom and trusting the centuries old tried and tested process. Funding should not be tied to ideological leanings of Ministers.

This approach is not without precedent, there are other similar bodies which have grant-making responsibilities but operate without Ministerial involvement in funding approval decisions. The National Health and Medical Research Council (NHMRC) reports to the Health Minister, who does not have any formal role in the grant approval process.

There's no need for a Minister to be involved in which research projects get approved and funded. It may assist the Senate to be reminded of the rigour with which applications for funding through ARC are assessed.

To begin with, the Grant Guidelines are developed in consultation with the research community in Eligible Organisations. Every Application is checked by the ARC against the eligibility criteria set out in the relevant scheme Grant Guidelines. This is done initially by General Assessors, who are distinguished academic researchers drawn from the ARC College of Experts. Detailed Assessors who are experts in the subject matter, drawn from the ARC Assessor Community, then review the project. The applications are then ranked and brought to a Selection Advisory Committee who make a recommendation to the Minister.

This is a highly organised and strategic process based on the age old process of peer review. The Minister simply isn't qualified to make these decisions. It doesn't even seem like the then Minister for Education Senator Birmingham bothered to find out more about any of the projects or contact the researchers before striking his red pen through it.

We as a country are poorer when political interference tampers with academic research.

For individual researchers it devalues their work and their time. Brett Hutchins, Professor of Media and Communications Studies at Monash University and Libby Lester, Professor of Journalism, Media and Communications at University of Tasmania had their research on environmentalism knocked back by the Minister for no reason. They said "We can live with rejection – it is a professional by-product of producing research. However, the rules through which funding decisions are reached should be transparent and the reasons for rejection should be communicated clearly to researchers and their universities. Neither has occurred on this occasion".

Academic Mark Stevens was another academic who had his research vetoed. After political interference from Minister Birmingham to veto his successful grant, he was forced to move overseas and now lectures at the University of Essex in the United Kingdom. He said that the veto had "very real, human effects" and his family had been put through hardship by having to move overseas to find work. "Securing that grant would have been a way of staying in Australia, where [my wife and I] were born, raised, educated, and where we worked".

For the research community it undermines confidence and job security. The universities themselves have come out strongly against political interference. Universities Australia chief executive Catriona Jackson said "You don't expect the federal sports minister to choose Australia's Olympic team. Our world-leading researchers depend on an impartial system that funds research on the basis of merit – this is why we rely on the competitive peer-review system to fund the highest quality applications."

This is just one of a litany of attacks on universities by the Liberal-National Government. The contempt for higher education from this Government is really troubling. The funding cut of $2.2 billion, effectively reintroduced a cap on a sector still reeling from billions cut from their budgets under the Gillard Labor Government. We have attacks on freedom of protest at universities by the Government and we have this ridiculous proposal for a national interest test for research grants.

And just when you think the Morrison Government is beginning to end its war on universities and students by lifting the cap on places at regional universities, we find out they are robbing Peter to pay Paul by cutting research grants to fund this.

There is no end to their attack on higher education.

The Government and the opposition response has been weak. Merely publishing the reasons for the veto is not good enough. It is already too late. There is no justification for the veto and it has to go. No Minister, no matter which party they are from, should be able to undermine the rigorous approval process of academic research grants.

I commend the Bill to the Senate.

Debate adjourned.

Senator McALLISTER (New South Wales—Deputy Opposition Whip in the Senate) (12:45): The Aviation Transport Security Amendment Bill 2018 responds to expert advice that concluded that when it comes to small airports, the level of red tape involved in the transport security process is excessive when weighed against the security threats they face. Accordingly, the legislation proposes the creation of a model TSP for small industry participants. The model TSP would ensure operators were aware of their responsibilities under the Aviation Transport Security Act 2004. It would allow operators of airports that are assessed as low risk to focus on implementing and maintaining the robust security measures in their plan rather than focus on red tape and reports for the Commonwealth. This is an approach that reflects informed risk management. It has broad support across the aviation sector and has been positively examined by a Senate committee. The opposition will support this bill.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:46): I thank senators for their contribution. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:46): I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Senator McALLISTER (New South Wales—Deputy Opposition Whip in the Senate) (12:47): The Marine Safety (Domestic Commercial Vessel) National Law Act 2012 and the Navigation Act 2012 give AMSA the ability to make what are known as marine orders. Marine orders are designed to be legislative instruments allowing AMSA to keep pace with developments in a rapidly changing industry. For example, Marine Order 15 relates to fire protection for ships and Marine Order 17 concerns regulations for carrying dangerous liquids.

The original intent of the marine orders as defined in the Navigation Act 2012 was that they would be legally enforceable and, particularly, that they would include a provision for penalties for noncompliance. However, the government has lately faced legal questions concerning the enforcement of marine orders. This legislation clarifies the situation to give marine orders the status of regulations, as was the original intention. The amendment to the Marine Safety (Domestic Commercial Vessel) National Law Act 2012 inserts a definition for regulations that includes marine orders, with relevant exceptions. The amendment to the Navigation Act 2012 makes the same change. Labor supports these changes.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:48): I thank senators for their contribution. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:49): I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Senator McALLISTER (New South Wales—Deputy Opposition Whip in the Senate) (12:49): I seek leave to incorporate my remarks rather than work through them, verbatim, in the chamber.

Leave granted.

The speech read as follows—

I rise to speak on the National Housing Finance and Investment Corporation Amendment Bill 2018 and I am pleased to indicate that Labor will be supporting the Bill.

The legislation which first established the National Housing Finance and Investment Corporation (NHFIC) was passed by the Parliament at the end of the Winter Parliamentary Sittings on 28 June 2018, also with Labor's support.

However, at that time there was no opportunity for the House of Representatives to consider any amendments to the Bill that might be forward by the Senate prior to the NHFIC's proposed establishment date of 1 July 2018.

In order to prevent any undue delay in the NHFIC's establishment, and to facilitate its board being put in place in a timely fashion, Labor reached an agreement with the Government to withdraw our amendments and allow for that Bill's unamended passage.

This support was contingent on the Government providing an undertaking to introduce, and support, new legislation containing Labor's amendments in these Spring parliamentary sittings.

We received that written undertaking from then Treasurer Scott Morrison, and this Bill honours that commitment from Government.

Labor are very pleased to have seen the NHFIC set-up, as the establishment of a bond aggregator to assist the community housing sector was a key part of Labor's Plan for Housing Affordability & Jobs released in April 2017.

The Bill itself contains 3 amendments to the original legislation - including Labor's sensible and measured amendments.

These include a requirement that at least one director on the Board of the National Housing Finance and Investment Corporation has relevant skills and experience in social and affordable housing gained in the community.

This proposal was put forward by a number of community housing providers during the Senate Inquiry into the NHFIC, including St George Community Housing Limited who stated - and I quote:

"We would suggest that it benefits the objective of the NHFIC to have a Director or Directors with experience and expertise related directly to social and affordable housing and the economics and social benefits of related projects housing provider sector."

A further amendment will bring forward the review of operation of this Act to as soon as possible after the period of 2 years beginning when this Act commences.

This review is to allow for key issues surrounding the loan cap, funding for capacity building, and the use of the National Housing Infrastructure Facility (NHIF) to be canvassed.

The remaining amendment proposed by the Government contained in Schedule 1 establishes a $1 billion special account for the purpose of the Affordable Housing Bond Aggregator (AHBA).

This amendment will allow the NHFIC to draw down on a $1 billion line of credit to support the AHBA. The existing $150 million appropriated for the AHBA is to be credited to the special account.

Funding gap

Labor sees considerable benefit in a bond aggregator ­however, it is regrettable that the Coalition Government in its more than 5 years in office has ignored the other key issues holding back the Australian community housing sector from delivering affordable rental housing at the scale.

And that scale of need is significant. Research released just today by the Australian Housing and Urban Research Institute (AHURI) has identified that the current unmet need for social housing across the country is more than 430,000 dwellings.

Yet the Government, contrary to all expert advice, have failed to address the so-called 'yield' or 'funding' gap.

We know that policies to address the yield gap are necessary to complement the work of a bond aggregator, and such policies are key features of successful aggregators operating overseas.

When last in Government, Labor took decisive steps to address the funding gap via the National Rental Affordability Scheme (NRAS).

The NRAS scheme has delivered more than 36,000 new dwellings, with more than 2/3rds owned or managed by community housing providers.

That scheme has delivered real relief to its tenants that were experiencing rental and housing stress. The Department of Social Services annual report indicates that NRAS has increased the availability of affordable rental housing to low and moderate income households and has reduced the rent for dwellings in the scheme.

Importantly, NRAS reduced the proportion of NRAS households in rental stress by more than 20 percentage points and 60,000 people have benefited from the Scheme, including more than half of tenants with household incomes of less than $40,000.

Regrettably, the Coalition axed the expansion of the NRAS scheme to 50,000 dwellings.

Since that time Labor has been consistent in its calls for the Government to develop, as a matter of urgency, a policy and funding framework that bridges the yield gap.

Yet it has become abundantly clear that the Coalition Government has no intention of addressing this issue, or having any meaningful policy to address the broader issues of housing affordability and supply.

Only a Labor Government will tackle the housing affordability crisis. We have announced a comprehensive series of policies to this end, and will have more to say in the lead up to the next election.

I commend the Bill to the House.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:49): I thank senators for their contributions. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.

The ACTING DEPUTY PRESIDENT ( Senator Sterle ) (12:50): As no amendments have been circulated, does any senator require a committee stage? If not, I shall call the minister to move the third reading.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:50): I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Senator McALLISTER (New South Wales—Deputy Opposition Whip in the Senate) (12:50): The Shipping Registration Amendment Bill 2018 will make minor amendments to the shipping registration process to modernise the system. The amendments remove the shipping registration certificate from existing regulations and allow them to be directly approved by the Australian Maritime Safety Authority. Mr Acting Deputy President Sterle, I know that this legislation is of great interest to you. By taking the certificate forms out of the regulations, they can be updated and changed as needed without going through the lengthy process of amending the regulations themselves. The bill includes a suite of other minor associated reforms, including requiring the Australian Maritime Safety Authority to publish forms on its website, clarifying responsible authorities for a variety of existing provisions and creating the ability for the Australian Maritime Safety Authority to exempt some ships from ship-marking requirements—for example, heritage ships. It also allows for the authority to specify the forms that must be used in applications for shipping registration. Labor supports these minor reforms.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:51): I commend the bill to the Senate.

Question agreed to.

Bill read a second time.

The ACTING DEPUTY PRESIDENT ( Senator Sterle ) (12:52): As no amendments have been circulated, does any senator require a committee stage? If not, I shall call the minister to move the third reading.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:52): I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Senator McALLISTER (New South Wales—Deputy Opposition Whip in the Senate) (12:52): Labor will be supporting the Treasury Laws Amendment (Black Economy Taskforce Measures No. 2) Bill 2018 and the Excise Tariff Amendment (Collecting Tobacco Duties at Manufacture) Bill 2018. These two bills implement three measures announced in the 2018-19 budget under the banner 'black economy package'. The measures add $4.2 billion to revenue over the forward estimates.

Schedule 1 to the black economy bill denies an income tax deduction for certain payments if the associated withholding obligations have not been complied with. Withholding payments such as pay-as-you-go earnings can currently be claimed as a deduction, even if the required withholding obligation hasn't been met. The government argues that this will provide a greater incentive for employers and entities engaging contractors to comply with their withholding obligations. This measure has an unquantifiable gain to revenue. This implements a recommendation of the Black Economy Taskforce's final report.

Schedule 2 to the bill requires entities providing road freight, IT or security, investigation or surveillance services that have an ABN to report to the ATO information about transactions that involve engaging other entities to undertake those services for them. This is an expansion of the taxable payment reporting system introduced by the former Labor government for the construction sector. It has already been expanded by the government to courier and cleaning services, with Labor's support. The measure increases revenue by $605.8 million over the forward estimates. The measure was a recommendation of the Black Economy Taskforce's final report.

The bills also amend the excise acts to establish a framework to make excise duty on tobacco due and payable at the time of manufacture. Presently, excise on tobacco goods is generally due and payable upon entry into Australia for consumption at the rate of excise applying at that time. The change in timing is to reduce the importation of illicit tobacco. The measure had a net gain in revenue of $3.6 billion over the forward estimates.

While we support the bill, it would be remiss of me not to note how a desperate government has thrown fiscal responsibility out the window, and at best now relies on accounting tricks to deliver its projected surplus. The sneakiest thing of all in the most recent budget is taxing tobacco 12 weeks earlier upon entry into Australia rather than, at present, when it leaves the warehouse. That will boost tax receipts once and once only in 2019-20 by $3.27 billion. As many commentators note, the Prime Minister, the former Treasurer who delivered this budget, is a former advertising executive and, like many advertisements, the projected budget surplus relied on a gimmick. Without that timing trick, the return to surplus would be pushed back a year to 2020-21. Nonetheless, I reiterate that Labor will support these bills.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:55): I thank senators for their contribution. As a government which inherited a $50 billion deficit and will deliver a surplus next year, we won't be lectured to by the Labor Party on fiscal matters, but I commend the bills to the Senate.

Question agreed to.

Bills read a second time.

The ACTING DEPUTY PRESIDENT ( Senator Sterle ) (12:55): As no amendments to the bill have been circulated, I shall call the minister to move the third reading unless any senator requires that the bill be considered in Committee of the Whole.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:55): I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Senator McALLISTER (New South Wales—Deputy Opposition Whip in the Senate) (12:56): I rise to make a contribution on behalf of the opposition to the consideration of the Treasury Laws Amendment (Financial Sector Regulation) Bill 2018. The opposition will be supporting this bill in the Senate, as we did in the House. We will support this bill because it is designed to increase competition in our banking sector, and you will always find the opposition leading the charge in the parliament when it comes to championing competition in financial services.

It is important that we don't overstate the impact of this bill in improving competition. The bill covers off an important area of law but it doesn't represent a seismic shift in competition. The changes in this bill are small ones. That is not to say that these small changes are not welcome. This bill will make some changes to provide opportunities for new market entrants who are doing exciting things, who are communicating with their customers in different ways and who are trying to increase competition and diversity in financial services. The major change that is being made by this bill is that it will increase the ownership threshold applying to companies that want to provide life insurance or general insurance, or to become authorised deposit-taking institutions or relevant holding companies in Australia, from 15 per cent to 20 per cent. Although the impact of this bill will be small, the impact will be an overwhelmingly positive one, which is why Labor is happy to support this bill.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:57): I thank senators for their contributions and I commend the bill to the Senate.

Question agreed to.

Bill read a second time.

The ACTING DEPUTY PRESIDENT ( Senator Sterle ) (12:57): As no amendments to the bill have been circulated, I shall call the minister to move the third reading unless any senator requires that the bill be considered in Committee of the Whole.

Senator SESELJA (Australian Capital Territory—Assistant Minister for Treasury and Finance) (12:57): I move:

That this bill be now read a third time.

Question agreed to.

Bill read a third time.

Senator HANSON (Queensland) (12:58): As I said earlier, when speaking on this Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017, it's good that something is going to be done about foreign donations into political parties, but does it go far enough and is it really going to stop it? Foreign donations could actually go through Australian subsidiary companies here in Australia. Is that going to be picked up? I do have a concern about that. The Greens raised the point of the $1,000 donation limit for disclosure, and the Labor Party also think about disclosure. I can speak from experience, because I'm the only one in this place—apart from Senator Leyonhjelm, who has the Liberal Democrats, and Senator Bernardi, who has the Australian Conservatives—who actually knows about running a political party. No-one here on the benches of the Labor or the Liberal-National Party would have any idea. To understand the Electoral Act—they wouldn't have a clue what they were talking about.

Senator McAllister: Like running in a ballot—

Senator HANSON: You know about collecting your public funding over the years. Let me start here: 2007. The Australian Labor Party's public funding—this is taxpayer funded dollars—was $22 million. The Liberal Party had $18 million and the Australian Greens had $4 million. Then we can go to 2010. Again, the Australian Labor Party got nearly $21 million, the Liberal Party got nearly $21 million and the Greens got $7 million. In 2013 the Liberal Party got almost $24 million, the Labor Party got almost $21 million and the Australian Greens got $5½ million. And in the last election, 2015-16, the Liberal Party got $24 million, the Labor Party got $23 million and the Australian Greens got nearly $7 million. This is all about the electoral funding—the whole bill is.

The bill states that you are to put in the receipts to get the funding back. In Queensland, that's how the election is run. In Queensland and in Western Australia you actually have to put in the receipts to receive the funding back. That's what should happen. Or, possibly—another case in point is that the donations a political party gets should be taken off the amount of electoral funding that it's entitled to get back through the taxpayer. So you can't have your cake and eat it too. You shouldn't be getting these donations from big corporations and the unions.

There are hardworking Australians who pay their dollars to the unions—$14 or up to $20 a week that they're paying. They're struggling to pay their bills—their electricity bills, keeping food on the table for the kids and all the other expenses—but, no, they pay their union fees. Those go, in turn, to get these union bosses elected to the parliament here. Then they turn around; they're not worried about Australian jobs, because they're signing international free trade agreements that are giving away jobs overseas—like the 5,000 jobs under the China free trade agreement and the TPP-11 that's just been signed. Also, we can look at the Indonesian free trade agreement and what is under the South Korean free trade agreement.

This is Labor representing those hardworking Australians out there. You take their money to run your campaigns so you can have your jobs in here.

Senator Watt: Do you really want to talk about this?

Senator HANSON: I don't see you standing up and fighting for the Australian jobs. What have you done for apprenticeship schemes? Nothing! You've actually done nothing for apprenticeships in this country at all. Then, Senator Cameron had the audacity to get up and have a go at me as if it were absolutely nothing that I fought for 1,600 apprenticeship schemes in Australia, because—do you know what, Mr Acting Deputy President McGrath?—it was out in the bush. It was to try and help those ones—

Senator Watt: You cut a lot more—

Senator HANSON: I've done a lot more in the last 2½ years than Labor has ever done to get jobs for the youth in this country. In the last 2½ years that I've been here I've done a lot more than what the Labor Party have done.

The fact is that it's a start, and I'm pushing for more. You scoff at the fact that it's a $60 million cost to the taxpayer under my apprenticeship scheme. But the fact is that I would rather see that paid than have them paid Newstart allowance or a benefit to sit around doing absolutely nothing. At the end of the day, we're going to have our own skilled tradesmen and women in this country and not open up the floodgates that you've allowed with people coming to this country.

On this electoral allowance: what I'm saying is, let's be fair to the taxpayer. You can't have your cake and eat it too. If you're going to get your political donations then that comes off the top figure of the electoral funding. You can't have both. I'll find it in my notes here—it was actually the New South Wales Electoral Commission that did away with electoral donations from unions to political parties. Once I find it, I'll go back to it.

Even under this bill, what we're talking about are receipts. There should be receipts. People should put in their receipts to prove it to the Australian people, and there should be a cap on donations. If you're going to have donations then there should be a cap of $13,800 from everyone. I think $1,000 is too low, because it's extremely hard to keep a note of that, to report all that.

The Labor Party and the others in this chamber, and the Greens, have raised the fact that you can't debate me on my policies. So you throw out, 'Racist party'. Just yesterday it came from Senator Cameron. You throw out 'racist'. You have no basis for it whatsoever. I challenge anyone to put up anything racist that I've said. Criticism of policies about the direction of this country is not racism. You can't debate me on my policies; you've got to throw words around. Debate me on my policies. Don't get in the gutter, although that's what you're so used to—getting into the gutter, gutter politics—and people are fed up with it. There should be a cap on donations up to $13½ thousand from individuals, corporations, unions, GetUp!, anyone. There should be a $13½ thousand limit. Let's limit it to that and see what happens then. You might get out and really do the hard campaigning instead of getting your money from hardworking Australians, as the Labor Party do, or big corporations, where the other side of this chamber, the government side of this chamber, get their money from.

There have been stories put around, but I just want to tell you, in talking about electoral funding: I was out of this party for 13 years, from 2002 until the very end of 2015, but I came back in to lead the political party known as Pauline Hanson's One Nation. So, I was not the leader of the party for any political elections that the party stood in during that time. Can I also say that, at the time, after the 1998 state elections in Queensland and also the federal elections, I was a threat to major political parties, and, therefore, a case was made against me to charge me. That charge saw me in the criminal court. But people should know that it was a charge of: were there actually 500 members of the political party when we registered in Queensland in 1998? The fact is that the charges brought against me said, 'No, they weren't people of the political party but people of the support movement.' Therefore, I was taken to the criminal court over this.

I should never have been charged in the first place, because, under the Electoral Act, it stated that an entity of a political party had the right to register a political party, as was found in my final appeal, the third appeal. But what's interesting about all this is that the Electoral Act said there should be a fine or six months imprisonment, but the Labor Party in Queensland, under Peter Beattie, only months before my court case, changed the act to make it seven years, retrospectively. So, when my sentence was handed down, it gave the judge the authority to give me a sentence of up to seven years. On the three charges, I was given three years on each charge to be served concurrently with a non-parole period.

This was political. It was the Liberal Party, under Tony Abbott, who set up the slush fund, and it was the Labor Party that actually saw it through in the courts. Because of that, the electoral funding that we received from the 1998 state election was $502,000. That electoral funding was put into a lawyer's trust account. That money then went to pay back our candidates, because we paid back 75 per cent of our candidates' personal campaign costs, and the rest of the money was paid to run the campaign. I had to pay that money back, because I was the party agent, although I did not receive any of it. I ended up getting money only through the generous donations of the Australian people, so I was able to pay that. Otherwise, I was going to have to sell my home, which I worked hard for and had paid for. My sentence was overturned. That money has never been repaid to the party, and I have advocated that I would be giving it back to the people who donated that money to me. I received no compensation for my wrongful imprisonment, which was 11 weeks in maximum security.

So, for the Labor Party to go on about electoral funding and accuse me—I have fought for 18 years to get myself back into this place, to stand up and represent the Australian people. If you are fair dinkum about this—the amendment I'm putting up is that no electoral funding be paid to any political party candidate or independent; no-one at all—if you are fair dinkum about worrying about the people out there, those millions and millions of dollars at every election, as I've just read out, costing the Australian taxpayers around $60 million in public funding, could then go back to hospitals and schools, which you go on so much about, or infrastructure that is much needed in this country, and looking after the nursing homes and looking after the farmers during times of drought, or looking after people with depression, where suicides are happening in this country. If you are really serious about it, stop putting your hand out and taking the electoral funding every time an election's held, because the people are fed up with it. It's take, take, take. That's what people see from this house all the time—that you're not prepared to be up-front and honest with the Australian people.

And you accuse me of it. Well, the people have had a gutful of it, and so have I. If you've got anything to say, then back it up with some facts. Because I stood and I abided by the rules, the laws, and I was entitled to electoral funding like anyone else, that's no reason to continue to drag this up. The people aren't satisfied with it. I did those 11 weeks—and I'm not going to go on about that, because I don't feel sorry for myself, but the people have a right to know what was done to me by the Liberal Party and also by the Labor Party in Queensland, because you wanted to get rid of me, and you still want to get rid of me. All this here about electoral funding is about that: it's about trying to get rid of the minor parties and those independents who wish to stand and to have true democracy in this country. That's what it's about, because you're both joined in this—joined at the hip in this legislation—because you can see the damage we are doing to your vote. That's what this is all about. Forget about the foreign investors, because they can go behind the scenes; they can do it through the Australian subsidiaries. They'll find ways to do it, as they have done. Be up-front with the people, and if you're really honest about this then make your donations to $13,500 or back my amendment that says: no more electoral funding for political parties, independents—anyone. Give the money back to the people, where it belongs.

Senator McALLISTER (New South Wales—Deputy Opposition Whip in the Senate) (13:13): Before turning to the substance of the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017, I would like to take a moment to reflect on the tortuous path to get here. The government's initial legislation was entirely inappropriate. It left charities and not-for-profits terrified that they would be stripped of their ability to participate in public debate. It has taken a year of fighting, both inside and outside this place, to drag the government to a position that is acceptable. I've been meeting with members of Hands Off Our Charities throughout this time. This organisation deserves our thanks. The organisations involved and their work on this issue showcase exactly what the community sector has to offer: a genuine commitment to ensuring that Australia has a vibrant and free public debate about the issues that matter.

I've spoken in this chamber a number of times this year about the importance of advocacy by the community sector. It's a belief that the government doesn't seem to share. Throughout its life, this government has shown hostility to civil society. The government's first draft of this bill was simply the latest in a series of aggressions towards the sector that included the abortive push to deny environmental groups legal standing and the outrageous gag clauses that prevent charities that deliver government social services from speaking out on policy issues. The government seems to think the only role for charities should be to provide services that the government can't be bothered to provide itself, and this is a mistake.

The community sector brings a depth of knowledge and understanding to public debate, and advocacy is a core part of its mission. Take Foodbank, for example: when they're not having their funding cut by the government for no apparent reason—like this week—their core mission is to provide food relief to vulnerable Australians and their families. Solving hunger in the long term, however, requires much more than putting meals on the table; it means addressing the fundamental drivers of poverty. So Foodbank have a separate research and advocacy strategy to shine a light on hunger and its causes. Hands Off Our Charities put it quite well in the communique they issued earlier this year: 'The people of Australia, and our country's civil society, need to be free to air their views, however uncomfortable for governments or political parties. And this best guarantees that our laws and policies truly support the Australian community.'

Democracy doesn't start in this place. It starts with free, well-informed debate in our media and around our kitchen tables. And those debates need honest voices that are genuinely interested in the public interest. That's why it's important that there be proper rules governing foreign donations. The community sector not only needs to have the ability to speak it needs to have the ability to be heard. We've seen from overseas what can happen when genuine public debate gets crowded out by loud voices funded by foreign interests. Restrictions on foreign donations do not just protect the integrity of our electoral system; at best, they also strengthen the conversations we have about the issues that matter. That is why Labor is happy to support the bill today, subject to important amendments that reflect the concessions we have fought for.

Thanks to the work that the Labor team has done with the sector, charities will have new clarity around their rights and obligations when engaging in political advocacy. We have ensured that only when an organisation spends money to influence a vote will it need to comply with the Electoral Commission's rules. And unless they're spending over $500,000 a year on electioneering—and currently no charity does that—charities and not-for-profits will still be able to use overseas donations to do their everyday work. We've also protected the rights of donors who support charities in their vital work. Civil society plays a unique and important role in public debate and Labor is proud to support it.

Senator HUME (Victoria—Deputy Government Whip in the Senate) (13:17): I rise today to speak in particular on the government amendments to the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017. Australia is one of the few Western democracies in which foreign donors can still influence domestic elections. The government's bill before us today will ensure that our electoral system, most importantly, protects our national sovereignty—and Australians should expect no less of a modern and vibrant democracy such as ours. Reform is necessary to support the integrity of Australia's electoral system and Australia's sovereignty by ensuring that only those with a meaningful connection to Australia are able to influence Australian politics—in particular, Australian elections—through political donations. Importantly, the bill before us will assure Australians that all political campaigning that targets Australian voters is paid for by Australians first and foremost, be it election advertising, campaign phone calls or how-to-vote recommendations. Foreign governments, foreign billionaires and foreign companies should never have a legitimate role in funding these activities to influence Australian politics.

The Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017 will improve the consistency of the regulatory treatment of all political actors. This includes political actors who have emerged in the Australian political landscape who neither endorse candidates from their own ranks, nor seek to form government themselves, yet actively seek to influence the outcomes of elections through their campaigning activities. While this is a positive indicator of the strength of Australian civil society and of political and civic engagement, it is vitally important that these actors are subject to the public accountability of more traditional actors such as registered political parties or, indeed, candidates.

This bill introduces a registration regime for all third-party campaigners who spend amounts on federal election campaigning above a particular disclosure threshold, and that threshold is $13,800 a year. Groups that spend at this level are already required to report annually to the Australian Electoral Commission on that expenditure. A registration regime will improve the transparency for voters and enable voters who receive material attempting to influence their vote to look up on a register the entity that has sent the material or that has provided that material. Registration will also assist the AEC's compliance and education activities by identifying the political actors and providing a contact person for AEC communications. Registration of third-party campaigners reflects current practices in other jurisdictions, in places like the UK, Canada and New Zealand. Similar to Australia, these are vibrant, robust and mature modern democracies.

In the 2015-16 financial year, which included the last election, you will recall third-party campaign groups spent almost $40 million—an extraordinary amount—on election advertising, polling and campaigning. These are third-party campaign groups; these are not political parties themselves. It is clear that elections are no longer just fought between political parties and candidates. For that reason, it is appropriate that all participants who choose to expend significant amounts of political expenditure are subject to the same transparency as those political parties and candidates that are fighting it out on the ground.

In recognition of the prominent role that a smaller subset of third-party campaign groups plays in public debate and their growing influence in elections, organisations that spend over half a million dollars in any financial year will have disclosure obligations imposed upon them in line with those imposed on political parties. These highly political organisations that choose to campaign at this level cannot use foreign donations for any purpose. By contrast, because many third-party campaigners such as charities spend far less on campaigning and also carry out non-election activities, they will not be prevented from receiving foreign gifts. Instead, third parties will be prevented from using foreign money for their electoral expenditure.

The bill does not restrict federal election campaigning—not in the least. It merely requires that Australian money be used for this category of expenditure. The Joint Standing Committee on Electoral Matters has undertaken over the last couple of years very significant work on the topic of foreign political donations and this bill over the course of the 45th Parliament. JSCEM tabled two advisory reports on the bill. The first was delivered in April 2018 and made 15 separate recommendations. The government has responded positively to those recommendations by sharing draft amendments with the committee to give effect to those recommendations. The government invited the Joint Standing Committee on Electoral Matters to provide its views on those draft amendments before they were circulated in the Senate. The joint standing committee made 12 further recommendations in relation to the draft amendments, and they included supporting the passage of the bill, subject to their final suggestions. The government has agreed to all of those final recommendations, and government amendments were circulated to senators at the end of October, reflecting endorsement of the last of the recommendations of the Joint Standing Committee on Electoral Matters.

The final amendments simplify red tape and make the penalties more proportionate to the size of any breaches incurred while also ensuring that the measures that reduce the regulatory burden do not compromise the bill's ability to protect Australia's national sovereignty. Importantly, these amendments clarify that spending solely on issue advocacy is not treated as electoral expenditure when that spending is not aimed at influencing voting in a federal election. The government's amendments also go further than the committee's recommendation in one important regard. In evidence submitted to the committee inquiry, representatives from the not-for-profit sector indicated that there has been widespread and inadvertent noncompliance with the longstanding disclosure obligations in their sector, so the government's amendments guarantee statutory forgiveness for historical noncompliance with third-party disclosure obligations.

The amendments also clarify the overlap of state and Commonwealth disclosure regimes, which is an issue that has arisen in recent state based litigation. The amendments ensure that, on the one hand, state or territory laws do not regulate donations for federal campaigns while, on the other hand, they give assurance that Commonwealth laws do not apply to money that is directed towards non-federal campaigns, so this includes state, territory and local government elections.

Subsequent to the previous inquiries of the Joint Standing Committee on Electoral Matters, the government has engaged further in constructive dialogue with the opposition and with stakeholders in the charitable sector. A final suggestion raised in these discussions was for a post-implementation review in two years time. The government has confirmed its support for that proposal. There will be another federal election under the belt by that stage, so the timing is appropriate. That will be achieved by way of a Senate motion that will be moved after the bill has been passed by the parliament.

The reforms in this bill are very important and necessary to support the integrity of Australia's electoral system and Australia's sovereignty. They will ensure that only those with a meaningful connection to Australia are able to fund Australian political activity. They will ensure that the Commonwealth electoral funding and disclosure regime keeps pace with international developments to prevent foreign interference. These reforms also provide transparency for Australian voters ahead of the next election.

There has been considerable support for this legislation, particularly from the not-for-profit sector. With your indulgence, Mr Acting Deputy President, I will enlighten the chamber on some of the support for this bill and the government's amendments. Universities Australia said:

Universities Australia welcomes the proposed amendments to the Bill, and believes they effectively resolve the concerns that the university sector had with the original Bill.

…   …   …

Universities Australia strongly supports the amendments proffered by the Government to resolve the university sector's concerns with the original Bill. Additionally, we believe the amendments will provide greater clarity to the disclosure requirements in the Commonwealth Electoral Act, which will be warmly welcomed by universities and other organisations in the research sector.

Universities Australia urges the Parliament to adopt the proposed amendments to the Bill prior to its passage. We believe that the amendments represent a sound response to the Committee's advisory report on the Bill …

Very encouraging words indeed. Philanthropy Australia said:

We welcome the manner in which the Australian Government has responded to the recommendations of the previous JSCEM Inquiry into the Bill.

…   …   …

We also recognise the work of the members of JSCEM and their clear commitment to ensuring that any Bill which is passed is fit-for-purpose …

That was in their submission to the Joint Standing Committee on Electoral Matters inquiry in September. Professor Tony Cunningham AO from the Association of Australian Medical Research Institutes said:

… there will be no impact on our members—

that's the members of the Association of Australian Medical Research Institutes—

and the health promotion work they undertake. Furthermore, the greater clarity given to the academic exemption also provides an additional reassurance that the work of medical researchers would not fall under the remit of this legislation.

Professor Cunningham goes on to say that the Association of Australian Medical Research Institutes:

… encourage the committee and the Parliament to support these amendments being made to the Bill.

Mr Hugh de Kretser of the Human Rights Law Centre said:

This proposed law adopts a far more sensible approach to regulating election communications while ensuring charities and other community groups are free to speak up about their work.

   …   …   …

We welcome the major improvements to this bill and thank MPs across the parties for their constructive engagement on this issue.

Mr Joseph McCarthy of the University of Melbourne said:

Given the narrowed scope of the new defined term 'electoral matters', universities will not be subjected to onerous political campaigner reporting requirements. Importantly, philanthropic donations will not be captured, thus enabling the university to continue to receive these vital funds to advance its academic activities.   …   …   …

… the University welcomes and supports the proposed changes to the Bill, and thanks the Australian Government for addressing the concerns raised by the sector.

Krystian Seibert from the Centre for Social Impact at Swinburne University of Technology said:

The proposed amendments are sensible and well targeted and have therefore been welcomed by various stakeholders across the not-for-profit sector.

The government should be commended for listening to the widespread and serious concerns raised about the bill from a diverse range of stakeholders, and for responding so comprehensively to both these concerns and the various recommendations made by the JSCEM when it first examined the bill earlier this year.

   …   …   …

It’s reasonable to expect that where charities do undertake electioneering activities, they should meet some basic transparency requirements regarding how much they spend on these activities and whether they received any larger donations to fund this spending. And charities are already required to do that anyway under the existing law.

   …   …   …

… it’s a hard argument to make that charities should receive a special exemption.

The Australian Major Performing Arts Group said that they welcomed the proposed amendments to remove the term 'political purpose'. It effectively addressed their major concern. The Australian Performing Arts Group welcomed the proposed amendments to the exemptions and they welcomed the narrowing of entities required to register. They also said that they appreciated the bipartisan approach to developing what they believe are effective amendments.

Ms Jill Reichstein from the Australian Environmental Grantmakers Network said they congratulated the government for listening and responding, resulting in a significantly improved bill. They said, 'The narrower definition provides greater clarity for philanthropic funders, thereby enabling donors to support important advocacy activities undertaken by the charitable sector, with less concern that their funding could trigger electoral laws.' The Australian Environmental Grantmakers Network also said that they were pleased that the bill continued to encourage international donors to fund Australian environmental issues.

A joint submission to the JSCEM from the Lord Mayor's Charitable Foundation, the Reichstein Foundation, the Ian Potter Foundation, the Australian Communities Foundation, the Foundation for Rural & Regional Renewal, the Vincent Fairfax Family Foundation, the Myer Foundation and the Sidney Myer Fund collectively said:

We welcome the way in which the Australian Government has responded to the recommendations of the previous JSCEM Inquiry into the Bill.

They also said that the proposed amendments which were the subject of the inquiry were therefore very welcome and addressed many of the concerns raised about this bill.

Mr Gideon Rozner from the Institute of Public Affairs said:

The IPA therefore welcomes these amendments, insofar as they achieve the government's objective without casting a net that is unduly and unreasonably wide.

…   …   …

… the government's amendments represent a substantial improvement on the bill in its original form.

Finally, Research Australia's Ms Nadia Levin said that Research Australia 'called for the bill to be amended to avoid these unintended consequences, and are gratified to see that this outcome has been achieved with the latest amendments'. The Health and Medical Research Centre is regularly invited to respond to reviews by government departments and is pleased to see that these activities do not fall within the new definition of electoral matters.

To summarise them, the proposed amendments essentially ensure three things. Firstly, they ensure that key political actors who spend significant amounts of money on electoral expenditure are subject to appropriate disclosure obligations, with obligations commensurate to their level of electoral expenditure. Secondly, the amendments clarify that spending solely on issue advocacy is not treated as electoral expenditure when that spending is not aimed at influencing voting in a federal election. This has been clearly the main concern for the charities and other organisations that have lobbied the JSCEM and also the government on laws where those groups do not specifically also seek to influence voting in elections. Thirdly, the proposed amendments importantly override state laws to the extent that they would prevent donations or compel reporting of donations that were made for Commonwealth electoral purposes or were made available for Commonwealth purposes, not pledged or reserved for use in state and territory jurisdictions.

So the reforms in this bill clearly are vitally important and necessary to support the integrity of Australia's electoral system and, of course, Australia's sovereignty. They do that by ensuring that only those with a truly meaningful connection to Australia are able to fund Australian political activity. This bill and its amendments will ensure that the Commonwealth's electoral funding and disclosure regime keep pace with the international developments that will prevent foreign interference. The reforms also provide transparency for Australian voters ahead of the next federal election.

Senator BROCKMAN (Western Australia) (13:37): I rise to contribute to the consideration of the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill today, to make a few points about the importance of the law keeping pace with a very much changing international global environment in political communications and political influence. We have to recognise the fact that as times change the law has to change. It was not too many years ago, when I first started to get involved in politics, that people who were out campaigning in Australia were 99 per cent funded by people putting their hands in their pockets and by Australian businesses contributing to political campaigns that influence their daily lives. But now you're seeing an increasingly globalised world, where the money trails are complex. They are very long and they are very obscure indeed.

Integrity in our political systems, in our electoral systems, is absolutely critical to the good functioning of government and civil society in this country. I think it is clear, from the discussions over the last couple of years and from the work done by JSCEM, that Australia's regulatory approach has not kept pace with international developments nor with some domestic developments. Internationally, there is an increasing incidence of foreign attempts to influence elections around the world. There are some high-profile cases involving government-to-government hacking of systems and so on, but there is a lot more prosaic funnelling of money through various institutions, various environmental groups, various social organisations, various channels that are, as I said earlier, very hard to track. It is very hard to extract the level of influence they are having within our system.

This is a concern not only in the real sense but also in the perception sense, because perceptions in politics are very important. We need to make sure we have a strong system of integrity and fairness, but we also need people to have confidence in that system of integrity and fairness—that it is actually working and that the accountability and the transparency of all those involved in political finance is utmost in our minds. Again, going back to the global nature, both of money flows and of political influence, we need to always keep that in mind when we are thinking about changes to our electoral legislation.

It's also important that we provide consistency in regulation so that, where large sums of money are involved, we seek to reduce foreign influence on Australian political actors by restricting the ability of that foreign money to finance domestic election campaigns. This is vitally important. One thing that has slightly puzzled me is some of the reactions to the initial tranche of legislation that the government put forward in this respect. Obviously, there was a very good JSCEM process—the Joint Standing Committee on Electoral Matters—which looked thoroughly into this bill, but, on the original tranche of legislation, there was another committee called the Select Committee into the Political Influence of Donations. I was on that committee at that time, and I asked the head of GetUp!, Mr Oosting, a pretty simple question, I thought. I asked: 'I know it's fully legal, but does a body like GetUp! accept foreign donations?' Mr Oosting's response was: 'Over time, we've received a very small number of foreign donations—roughly 0.5 per cent of our total income has come from forces overseas. That has included environmental foundations who have supported our work and one of our sister organisations, which is a global body called Avaaz. The maximum it's ever been is about 1.4 per cent of our income. I believe that was three years ago.'

That was at a time when GetUp! was launching a vociferous campaign against the government's approach to restricting foreign donations, and it does beg the question: if GetUp!'s income from foreign donations is so small, why was there a vociferous campaign launched against this government? It does make one think that perhaps it's because GetUp! is opposed to anything this side of politics does, as opposed to the contents of the actual laws themselves. I won't dare impugn the words Mr Oosting said. I take them at face value and assume that their source of funding wasn't coming from overseas. But, given that, why else attack the government so strongly over this legislation?

As I said, there was a very good process through the Joint Standing Committee on Electoral Matters looking at that original tranche of that legislation. As is good process in this place, that committee, looking at things from a number of different perspectives, came up with a set of recommendations, and the government took notice of those recommendations and has amended the legislation to take into account some of those recommendations in a constructive way. The government has always been on the record as being appreciative of the constructive approach and the goodwill demonstrated by all sides in that Joint Standing Committee on Electoral Matters. The government absolutely welcomes the cross-party support in the committee's report, which proposed that a foreign-political-donations ban should apply to all relevant electoral expenditure. The government has been back to the joint standing committee twice to ensure the bill aligns with the JSCEM's intentions in its recommendations.

So, again, we've seen with this bill a willingness to listen to voices on the other side, to alter the position, to make sure that we are getting these laws correct. This is a very contested space where we have to get the balance right to make sure we are not going to damage civil society. But, at the same time, we are going to cut off those potentially dangerous layers of money from outside actors seeking to influence the results of Australian elections. It is something that has happened everywhere else around the world. My understanding is that we are one of very few Western democracies that does not specifically ban foreign donations from playing a role in domestic election campaigns. So, in a sense, we are catching up, but it is still important to take those steps and make sure that we close the door.

So what does this bill actually do? It bans foreign donations from financing Australian politics. It does this by prohibiting the giving, and the knowing receipt of, all gifts from foreign donors where the donor intends the gift to be used for electoral expenditure. It penalises donors who make prohibited gifts or false or misleading statements to recipients. It requires donors to affirm to political campaigners, political parties and candidates that they are not foreign for gifts between $1,000 and the disclosure threshold—for instance, that may be a checkbox on a donation form—and it requires political campaigners, political parties, candidates and third parties to verify that donors are not foreign for gifts above the disclosure threshold, which is $13,800 this financial year, and that of course will go up over time.

A menu of alternative forms of proof is listed to help recipients check a donor's status. Recipients may use a listed approved form or undertake other reasonable steps to ascertain that a donor is not foreign. Anti-avoidance rules are included to, for example, adjust the movement of foreign funds between organisations. As part of the anti-avoidance rules the Electoral Commissioner can require an organisation that is part of an avoidance scheme to stop a scheme or not participate in it.

There is a transparency register as part of this bill. Again, that has perhaps caused some confusion. I think it is important to understand that the integrity of Australia's political process can be safeguarded through this increased accountability and transparency but, without the transparency part, there is no accountability. The registration and, more importantly, the publication of data on the transparency register in real time build on the authorisation reforms already introduced by this government by providing further transparency. This greater transparency will provide voters with unprecedented access to information about the political actors shaping political debate. It will also facilitate a more modern enforcement approach to the electoral funding and disclosure regime. By identifying those who comply with the reporting requirements early, the AEC can focus on education and assistance for regulated entities before deadlines have passed so the law is not broken.

Why aren't third parties required to register? In its advisory report, the JSCEM recommended that obligation should be commensurate with the level of expenditure. The government has actioned this recommendation while ensuring third parties are subject to a lesser regulatory burden than political campaigners, those organisations that spend significant amounts on elections. So who must register? The significant political campaigners and associated entities will need to register with the AEC. Following the submission of an annual return, third parties will be automatically added to the transparency register by the Australian Electoral Commission.

There has been significant consultation on this bill. Obviously the JSCEM process itself has been a very important part of that, bringing the major parties in this place together and giving all those who are interested the chance to look at this bill and contribute to its formulation and contribute to the amendments that I have discussed.

The bill was developed in response to growing concerns about foreign donations and the Joint Standing Committee on Electoral Matters' second interim report on its inquiry into the 2016 election. The committee then invited submissions from interested parties. In fact, the JSCEM received over 200 submissions. So you can see that this was an area that elicited great interest, particularly from organisations, community groups and people involved directly or on the periphery of the political process. The committee held nine public hearings in all capital cities except Darwin. Submitters and witnesses to the inquiry included academic citizens, interest groups and, of course, political parties. We do have a legitimate interest in making sure the system is correct and the system works. There was widespread consensus among those submissions that foreign donations should be banned for the reasons I talked about earlier. In view of the extensive consultation undertaken by the committee and its initial report and the high level of public engagement with the committee, the government, in effect, used the committee as a channel for the public consultation and revisions to the draft bill, and that is further demonstrated by the fact that the government went back to the joint standing committee on two occasions for further input into the legislation. Of course, the other party that was significantly consulted during this process was the Australian Electoral Commission, which has to oversee the implementation of this legislation. Obviously, the Attorney-General also played a significant role in the drafting of this legislation.

In the relatively short time I have available to me I want to run through the amendments from the initial bill that came out of the JSCEM process and were reflected back to JSCEM for their endorsement. Firstly, the proposed amendments do three things. They ensure key political actors who spend significant amounts of money on electoral expenditure are subject to appropriate disclosure obligations, with those obligations being commensurate with their level of electoral expenditure. Obviously, we don't want the same level of disclosure from a very small, very local community organisation as we expect from the large national players.

Secondly, the amendments clarify that spending solely on the issue advocacy is not treated as electoral expenditure when that spending is not aimed at influencing voting in a federal election. This has been one of the main concerns of charities and other organisations that spend a lot of effort lobbying on particular laws but do not necessarily go on to seek to influence votes at elections. Obviously, it's a very important part of civil society that groups feel that they can freely contribute to the development of legislation, the development of government policy, without being impacted by these changes.

Thirdly, they override state laws to the extent that they would prevent donations or compel the reporting of donations that were made for Commonwealth electoral purposes or are available for Commonwealth purposes—that is, not pledged or reserved for use in a state or a territory jurisdiction. You have a situation—particularly on that last point, I think it is important to say—where there is some inconsistency between state and federal laws. These amendments make sure that federal laws apply to federal elections and that state laws apply to state elections. It's very important that we keep that distinction, we don't confuse the two levels of government and we don't make it more difficult for people to be able to participate in our democracy at the two respective levels of government.

The government's amendments specifically address recommendations from JSCEM following its first inquiry into the bill. As I stated earlier, most of the recommendations address concerns raised by the charitable and not-for-profit sector. The amendments address these concerns by establishing a single transparency register on which key political actors are required to report their federal electoral expenditure and large gifts that are used to fund election campaigning. The amendments also ensure that pure issue advocacy is not treated the same as campaigning activity. It replaces the original definitions of 'political matters' and 'political expenditure' and replaces those with new terms, 'electoral matter' and 'electoral expenditure'. So, in that way, we are only seeking to capture the activity that is directly aimed at influencing how people vote in federal elections. We are not seeking to in any way restrict people from advocating for a particular position in regard to, for example, a government's policy position or a particular piece of legislation that is going to be before the parliament.

The draft amendments also seek to provide appropriate exemptions to recognising that 'electoral matter' does not include news reports, material created for a dominant artistic or academic purpose, private communications or private lobbying of Commonwealth officials, parliamentarians or political parties. We don't want to stop the flow of communication to politicians or parliamentarians; however, we want to make sure that people feel free to be able to communicate. Obviously free and open communication is one of the central tenants of our society. There are changes to the monetary threshold for rules that regulate gifts and expenditure above which more stringent requirements apply. When an organisation spends a significant amount of money on elections, it will be categorised as a political campaigner and will not be able to receive any gifts from foreigners for any purpose. This treatment applies where electoral expenditure exceeds $500,000. There are significantly more recommendations from the JSCEM report which I'm not going to have time to go through, but I do commend the bill.

Senator STOKER (Queensland) (13:57): There are not that many times that we have the opportunity to rethink the principles that motivate us in this place to do all that we can to engage the Australian people in the democratic process. Those principles, though, are worth revisiting. We need to be focused always on the importance of maximising the opportunity for all Australians to be active participants in the democratic process, well-informed, and able to assess the information available to them because it is transparent. We need to encourage honest participation, the genuine explanation of policy and discourage the tendency to have, in an election campaign, the misrepresentation or unfair manipulation of data that we see from time to time.

It's also really important to the integrity of our democratic process that we have an effective and efficient regulator, a competent and capable Australian Electoral Commission, one that is sufficient in expertise and flexible enough to deal with the unusual challenges that the election environment can present. It needs to be able to deploy resources to the often unexpected circumstances that can arise in a campaign. The unusual or unexpected arrival of a large number of people at a country polling booth, for instance, can present difficulties, just as those circumstances where a ballot is very close can present difficulties too. And it's quite a challenge to provide sufficient support and opportunity for that body to be able to always tackle that difficult task.

This bill is also about ensuring that our electoral system is one of integrity, one that protects our national sovereignty. It is really important to ensure that only those people who have a meaningful connection to the Australian people, the Australian parliament and Australia's interests are able to have a serious influence on Australian politics.

The ACTING DEPUTY PRESIDENT: Order! It being 2 pm, the debate is interrupted. Senator Stoker, you will be in continuation.