The PRESIDENT (Senator the Hon. Stephen Parry) took the chair at 10:00, read prayers and made an acknowledgement of country.
DOCUMENTS
Tabling
The Clerk: Documents are tabled pursuant to statute. The list is available from the Table Office or from chamber attendants. Details will be recorded in the Journals of the Senate and on the Dynamic Red.
Details of the documents also appear at the end of today’s Hansard.
COMMITTEES
Corporations and Financial Services Committee
Intelligence and Security Committee
Meeting
The Clerk: Proposals to meet have been lodged as follows:
Parliamentary Joint Committee on Corporations and Financial Services—private meetings otherwise than in accordance with standing order 33(1) during the sittings of the Senate, from 9.30 am—
Thursday, 17 August 2017
Thursday, 19 October 2017
Thursday, 30 November 2017.
Parliamentary Joint Committee on Intelligence and Security—private briefings during the sitting of the Senate on Thursday, 17 August 2017, from 9.30 am and 4 pm.
The PRESIDENT: Does any senator wish to have the question put on any of those proposals? There being none, I'll proceed.
BILLS
Social Security Amendment (Caring for People on Newstart) Bill 2017
Second Reading
Consideration resumed of the motion:
That this bill be now read a second time.
The PRESIDENT ( 10:0 1): On Thursday afternoon at 4.30 pm—sorry, Senator Di Natale?
Senator DI NATALE (Victoria—Leader of the Australian Greens) (10:01): I seek leave to move a motion to provide that the Defence Legislation Amendment (Parliamentary Approval of Overseas Service) Bill 2015 be called on immediately and have precedence over all government business until determined.
The PRESIDENT: Senator Di Natale, do you mind if I deal with the Social Security Amendment (Caring for People on Newstart) Bill 2017 division first, and then I'll come back to your item? Are you comfortable with me doing that?
Senator DI NATALE: I am, but can you explain to me what your thinking is on that?
The PRESIDENT: We need to resolve an issue—a vote of the Senate. I understand it's the wish of the Senate we deal with that first. I think it's important to have that clarified. Immediately after that I will call you, and then you can seek leave again. In that case, then, on Thursday afternoon, after 4.30 pm, a division was called for on the second reading of the Social Security Amendment (Caring for People on Newstart) Bill 2017. I understand that it suits the convenience of the Senate that a vote be held now. If that is the case, I ask the question that the bill be now read a second time. All those of that opinion say aye. Those against say no. I think the ayes have it. The ayes have it? No division required? In that case, then, we declare that the motion has been passed. Now, Senator Di Natale, if you would like to seek leave for the matter you just raised.
Senator DI NATALE: I seek leave to move a motion to provide that the Defence Legislation Amendment—
The PRESIDENT: Order! There is confusion. We'll go back to the beginning. Senator McGrath?
Senator McGRATH (Queensland—Assistant Minister to the Prime Minister) (10:03): Could we have that recommitted, please?
The PRESIDENT: Is there any objection that I put the second reading of the bill again?
The question is that the bill be now read a second time.
The Senate divided. [10:08]
(The President—Senator Parry)
BUSINESS
Consideration of Legislation
Senator DI NATALE (Victoria—Leader of the Australian Greens) (10:10): I seek leave to move a motion to provide that the Defence Legislation Amendment (Parliamentary Approval of Overseas Service) Bill 2015 be called on immediately and have precedence over all government business until determined.
Leave not granted.
Senator DI NATALE: Pursuant to contingent notice, I move:
That so much of the standing orders be suspended as would prevent Senator Di Natale moving a motion to provide that the Defence Legislation Amendment (Parliamentary Approval of Overseas Service) Bill 2015 be called on immediately and have precedence over all government business until determined.
On Friday the Prime Minister of this country backed in an unhinged, dangerous, paranoid President, Donald Trump, into a conflict that could potentially end life on earth as we know it. We learnt earlier this year that, during that infamous phone call, Mr Turnbull said to President Trump: 'You can count me in. I'll be there again and again.' Now we know what he meant. He meant blind support for even the most dangerous and foolhardy of ideas—a military solution to the problem of North Korea. He meant that he would back in a man who has in the last week said that North Korea would face 'fire and fury like the world has never seen' and that military solutions are now fully in place, 'locked and loaded'. Where other sane, rational world leaders urge restraint and call for diplomatic solutions, our Prime Minister is offering uncritical support for Donald Trump's dangerous strategy and in doing so he's making us all less safe, putting a target on each Australian's back and increasing the possibility of the unpredictable Kim Jong-un targeting people right across the world, including Australians.
As we teeter on the precipice of what is potentially the first war started on Twitter, let us debate two things. Firstly, our involvement with the ANZUS treaty and our relationship with the US. It is crystal clear now that Australia must rip up the ANZUS treaty and renegotiate our relationship with the US. This is a relationship that is making us less safe, not more safe. It is a relationship that, indeed, endangers humanity on earth.
We also need to debate who should be in power to send Australian men and women to war. We're one of the few remaining democracies now on earth that can legally deploy defence forces, committing the lives of Australian men and women, into conflict without any debate in this parliament. In Australia we leave that decision to the executive alone. We know that desperate governments do desperate things.
It is deeply worrying that the decision to commit Australia to war could be left to Malcolm Turnbull and his mates. I mean, Prime Minister Turnbull can't even stand up to the homophobic bullies in his own party, let alone to this dangerous strongman. How deeply ironic that we have a government refusing to legislate for marriage equality without resorting to a needless postal poll, yet it can decide to send men and women to war, to put their lives on the line, without so much as even a parliamentary debate.
The Defence Legislation Amendment (Parliamentary Approval of Overseas Service) Bill 2015 has spent decades languishing in plain sight while Liberal and Labor prime ministers alike reserve this power to themselves. They have plunged Australia into a tragic series of overseas expeditionary wars that have nothing to do with the defence of Australia or, indeed, our collective security. It is not often I agree with former Prime Minister Kevin Rudd, but this morning he was spot-on when he said that the last thing Australia should be doing is handing a blank cheque to the US with Donald Trump as their President.
It's not just the Greens, of course, who are urging for this parliament to debate and enact this bill. We have had the former Chief of Army Peter Leahy urging the Prime Minister to consult parliament. The former Secretary of the Department of Defence Paul Barratt for years has been championing the call for war powers reform. There are many eminent Australians who back this. The rhetoric that we hear each morning from the United States, as we listen to the views of this President, may perhaps be deeply disturbing. We now have an opportunity to reconsider our views. I call on this chamber to set some time apart today to debate and pass this bill. (Time expired)
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (10:16): The government will not be supporting the motion to suspend standing orders. If I may say so, the intemperate speech which we have just heard from Senator Di Natale is perhaps the best example of the reason that decisions of this weight and gravity should be made by the executive government, informed by the military chiefs and the intelligence chiefs, informed by those who advise the National Security Committee of Cabinet, rather than a decision made in the heat of partisanship. That is the way the Westminster parliamentary system has always worked. Decisions to commit a nation to war—the gravest decision that any government can make—have always, according to the Westminster system, been made by the executive government.
That is not to say the issue cannot be debated by the parliament. I sat in the Senate at the time the Howard government decided to commit Australian troops to the second Gulf War. Regardless of what one's views about the commitment of Australian troops to that conflict may be, there was no shortage of parliamentary debate on the issue. In this chamber, we debated the issue for hours and hours upon end. So the question is not whether there should be an opportunity for parliament to consider the matter—parliament already has the opportunity to consider the matter; the question is who the decision-maker should be. It requires very little reflection to appreciate that, in making a decision to commit Australian forces to war and to put Australian lives in peril, considerations have to be borne in mind that are not capable of being aired in the public arena—in particular, intelligence and strategic considerations which, if aired in the public arena, could actually damage and imperil the military action in contemplation. I am speaking at a level of generality. I do not descend into the debate about the current strategic situation concerning North Korea. I say nothing about it.
What Senator Di Natale seeks to do is to challenge a principle which, were he to have his way, would in a militarily perilous situation potentially put Australian lives at risk. The way in which the Australian parliament, like all Westminster parliaments, deals with the matter is the right way: to allow the cabinet—in particular, the National Security Committee of Cabinet, advised with all of the intelligence, strategic information and military appraisal that our defence forces, intelligence agencies and others can place before it—to make that grave decision. No government would make a decision of such a kind lightly. The thought that this would be regarded as anything other than the gravest kind of decision that any government could ever make is fanciful.
Let there be debate in parliament, as there has been during every military conflict, whether it was the second Gulf War, the first Gulf War, the Vietnam War, the Korean War or, no doubt, the Second World War and the First World War. Let there be ample opportunity for parliament to debate the matter. But, please, do not fall for the folly of suggesting that a decision of this gravity could be made in a partisan environment in debate uninformed by the information that it needs to be informed by in a parliamentary chamber.
Senator GALLAGHER (Australian Capital Territory—Manager of Opposition Business in the Senate) (10:21): I rise to speak briefly on the suspension of standing orders this morning. The opposition will not be supporting this suspension this morning. While I would like to acknowledge up-front that the opposition recognises that North Korea's behaviour is the greatest current threat to peace and stability in our region, we do not believe that it is the correct use of the Senate's time to debate a bill of this type. I'll speak more on the substantive issue and the bill Senator Di Natale has raised this morning in a moment but, if the Greens were serious about this issue, they would not be moving a suspension of standing orders this morning without notice.
Last Thursday, for example, the Greens had an hour of the Senate's time, which was specifically allocated to Greens in general business to debate whatever issue or bill they decided warranted the attention of this place, and this issue was not raised. Instead of highlighting this issue, they then chose to bring a bill on for debate that was introduced just one day earlier. I don't believe it's fair to say that they can stand here today and genuinely say, 'This is a matter of importance that has just raised its head over the weekend.' The actions of North Korea have been well known for some time and, most definitely, have been highlighted previous to last week, when the Greens had time to raise this in line with the normal procedure of this chamber.
I'd like to make a few short remarks on the substantive issue relating to the suspension this morning. As I mentioned at the beginning of my remarks, the opposition recognises that North Korea's behaviour is the greatest current threat to peace and stability in our region. Its rapid advancement of ballistic missile and nuclear weapons technology has been increasingly provocative under the current regime and is of great concern to the international community. Like the government, Labor strongly urges all parties to continue down the path of easing tensions and encouraging dialogue. As North Korea's only major ally, China is well-placed to intervene effectively. Labor recognises the efforts China makes through diplomatic and economic means to denuclearise the Korean Peninsula and welcomes its support of recent additional UN Security Council sanctions. Labor urges China to look at what more it could do.
On parliamentary scrutiny, Labor has taken the long-held position—as previously articulated by Senators Faulkner and Wong on many occasions—that, under our system of government, a decision to deploy members of the ADF, whether for combat operations, peacekeeping or disaster relief, should be a decision made by the executive government. We also believe that government should be as open and as transparent as possible through that process and provide to the parliament regular reports on Australia's role. We also believe the process should be accompanied by appropriate parliamentary debate and time for appropriate consideration of all matters. That's Labor's position, and we won't be supporting the suspension of standing orders this morning.
Senator PAYNE (New South Wales—Minister for Defence) (10:24): It is worth observing for the benefit of the chamber not only that Senator Di Natale is incapable of providing the Senate with the courtesy of notice of a motion of such a serious nature as this but also that the cynical amongst us would be entitled to presume that the only reason that Senator Di Natale and the Australian Greens have moved this resolution here this morning, with no notice, with no courtesy to the other parties in the chamber, is to try and hide their own fundamental, inherent defects as a political party in Australia, which apparently are about to be made clear for all to see by the ABC this evening—an interesting turn of interest for the ABC in and of itself.
The decision to send our service men and women into harm and into harm's way is one of the most serious decisions that a government can take. The government is accountable for such decisions to the Australian people. Due to the dynamics and the sensitivities of national security issues, the decision to commit the Australian Defence Force to overseas contingencies continues to be one that is best made by the executive. This is a vital aspect of our proceedings in the Westminster system, if Australia hopes to successfully defend its interests and protect its people. I wouldn't always agree with Senator Gallagher and those on the other side, but the observations that Senator Gallagher made in relation to this process are also apposite. Our current arrangements ensure that the government is able to respond in the national interest where the deployment of the ADF is required.
The government, as Senator Brandis said, does not support this bill. There have been many draft bills of a similar nature over a number of years, designed for authority to go to war on the parliament dating back to 1985. Given the amount of time that I've been in this chamber and associated with this policy area, I have participated in the consideration of those and the debate of many. I reinforce that defending Australia, its people and its interests is the government's highest priority and most important responsibility. The government's duty of care also to the men and women, the members of the ADF, is paramount, and no decision to go to war to engage in conflict is ever taken lightly.
The government's ability to deploy the ADF has long been regarded as an essential prerogative of the executive exercisable under section 61 of the Constitution. The government needs the ability to act swiftly in responding to threats to our national security based on the best advice available. The existing arrangements allow the government to act decisively and respond flexibly to contingencies when they arise. But, importantly, as the Attorney-General said, this power does not prevent the discussion of the testing of the decisions made by the government on the floor of the parliament, and we have seen repeated examples of that engagement over the years. There are appropriate checks and balances on executive power through the normal business of the parliament.
The bill aims to remove the government's power to respond flexibly and immediately to national security issues. It proposes, for example, that members of the ADF may not serve 'beyond the territorial limits of Australia except in accordance with a resolution which is in effect and agreed to by each house of parliament authorising the service.' While the intent behind the bill may, on a very broad consideration, be described as well-meaning, there is underlying fault in its concept and its execution. My view in those previous debates was, and remains, that longstanding Westminster convention allows executive government the discretion to commit forces to operations overseas. The executive branch of government is elected by the people to make those hardest of decisions and is answerable to the people for those decisions.
Senator XENOPHON (South Australia) (10:29): I advise on behalf of my colleagues that we support this motion. It is critical that we debate this issue as a matter of urgency, because the impact on Australia of being involved in a conflict in the Korean Peninsula and beyond, including the possibility of a nuclear conflict, would be profound. It would have the most profound effect on Australia since World War II. We can't sleepwalk into a war. We need to heed the words of former heads of Defence in this country who have expressed caution on the need for a parliamentary debate. But I want to make it clear that we believe that, while the debate is urgent and essential, there is a different approach that should be taken. I'm grateful for the considered work of Professor Clinton Fernandes of the University of New South Wales and others in relation to this. I believe that parliamentary authorisation is workable and can be formulated in a suitably flexible way that takes a variety of contingencies into account, protects the security of classified information and copes with the time-sensitive nature of emergency military deployments.
Flexibility can be preserved by distinguishing between wars of choice and wars of necessity. Wars of necessity refer to military actions taken in self-defence that require the use of rapid and/or covert military force. Such wars may involve deployments beyond the territorial limits of Australia. The executive must have the freedom to act without parliamentary authorisation when it does so in self-defence. This is provided for in article 51 of the UN charter. The executive must also have the freedom to act pre-emptively without parliamentary authorisation when the threat to Australia is instant and overwhelming, leaving no choice or means and no moment for deliberation, as the UN charter reflects. In time-sensitive wars of choice, defined as coalition operations under chapter 7 of the UN charter, with a request for assistance from a legitimately constituted government of a state, the executive must be required to provide parliament with a certification that an instantaneous response is needed. This would notify parliament of the reasons for the deployment, the legal authority, the expected geographical extent, the expected duration and the number of ADF personnel involved. Parliament can then choose to persist with or revoke a deployment post facto. Such a rule would bring Australia up to the same standard as Germany and Norway—both NATO allies, with far more compelling treaty obligations than ANZUS.
In terms of security, given the need to preserve tactical and strategic surprise, no parliamentary approval need occur when military commitments take the form of special forces deployments or a decision to send Australia's submarines to a conflict. A consistent objection over 30 years of legislative proposals is that only the executive has access to or can be trusted with the intelligence information required to decide whether to deploy troops. A solution to this would be to empower the Parliamentary Joint Committee on Intelligence and Security, the PJCIS, or the foreign affairs and defence subcommittees of the Joint Standing Committee on Foreign Affairs, Defence and Trade or the Senate Standing Committees on Foreign Affairs Defence and Trade such that they have access to the relevant intelligence information. Such a move would put us in line with the USA, with the intelligence committees and judiciary committees in the Senate and House of House of Representatives being regularly briefed about all authorised intelligence collection programs and relevant members of congress receiving detailed briefings prior to such reauthorisation.
In addition, the US executive is required to brief select groups of congress men and women on specific types of operations before they take place. Members of the so-called Gang of Four, comprising the chairpersons and the most senior opposition members of the House and Senate intelligence committees, receive briefings on sensitive non-covert intelligence programs, such as highly sensitive intelligence collection programs. The Gang of Eight, comprising the Gang of Four and speakers and opposition leaders of the House and the Senate, receive briefings from the executive on forthcoming covert actions without having the power to approve or veto executive plans. This preserves executive freedom while ensuring a check on executive over-reach. Furthermore, all members of the House and Senate intelligence committees and their key staffers are regularly provided with extended footage of completed operations involving, for example, drone strikes. No such provision exists in Australia. Such a system of oversight would also bring Australia up to the same standard as NATO states such as Norway and Germany. Thus, in contrast to objections that Australia's ANZUS obligations constitute a special case that makes special legislative involvement unworkable, it can be seen that Norway and Germany, which have much more demanding treaty obligations through NATO, are perfectly able to ensure legislative involvement. Unlike Canada or the US, Australian senators are directly elected; thus a joint sitting of parliament would be a possible option. That is why we support this motion.
The DEPUTY PRESIDENT: Before I call you, Senator Hinch, could I get an attendant to remove what seems to be, in my view, a prop on Senator Macdonald's desk. He may not have meant it as one, but it does have writing on the front. Senator Hinch.
Senator HINCH (Victoria) (10:34): Thank you. I will be supporting the motion to suspend standing orders to discuss this important issue, but I endorse the comments of Senators Brandis, Payne and Gallagher that ANZUS is there, ANZUS is important and ANZUS must be respected, and it is for the executive government to make a decision on such an important issue. If North Korea or one of Australia's other neighbours launched any form of attack or threat on Australia, we would not be sitting here arguing that the United States Congress should decide before America comes to our defence and assistance. On this, I agree with the government that it is an issue of such importance as to send troops. It should never be taken lightly, but it's for the executive government to do that. I think that this can be heard, and I think that the Greens are fair to bring it on.
Senator WHISH-WILSON (Tasmania) (10:35): Here is a little bit of short-term history for the minister and Senator Brandis. Last week, it was reported in the paper that Hugh White, one of our country's pre-eminent defence experts, had come out and said that, if there were a conflict in North Korea, Australia would very likely provide military assistance. He talked about F/A-18F Super Hornets, Growlers and submarines. It only took a day for Mr Tony Abbott to be out there goading the Prime Minister by saying we need a missile shield, a missile defence system, in this country. This is the internal politics that's going to get us in trouble. This is why the executive say they need the power, and this is why it's dangerous: because of politics. Who thinks Mr Donald Trump is any different? What's he doing with North Korea on Twitter and social media? He's shoring up his position in his domestic audience. This is about his votes and his power back in America. This is why it's dangerous, and this is why we need a parliamentary debate.
Only recently, this chamber commemorated the Great War. I see Senator Sterle here. I know he's been over to the battlefields of World War I, as I have. I wonder what we've learned in recent weeks when I see the reckless escalation in rhetoric by the US President, our supposed ally. And then I see the reckless escalation of this debate by Mr Tony Abbott and Malcolm Turnbull, saying that we would go to war along with the US if it came to a conflict in North Korea. What have we learned? When I think about World War I, the best explanation I've been given for World War I was by Blackadder, when Baldrick said to him, 'Sir, why are we in this terrible war?' He said, 'Baldrick, because it was too hard just not to have one.' That's exactly what The Economist said this week when they published their story on North Korea: their key concern is it's going to be too hard not to have a conflict. Both sides have escalated this to a point where there's no going back. And the headline on The Economist said 'This could happen', with a picture of a nuclear cloud and our two fearless leaders' heads in the nuclear cloud.
I can tell you from my weekend in quiet Launceston that, for the people I spoke to at the markets and the football game I went to, this is the only thing they wanted to talk to me about. Australians are very worried about this. They expect us in parliament to be having this debate. They want the people that they voted for to represent them to help make these decisions.
We have long fought and campaigned for war powers reform in this country, and there's a whole chorus of voices joining the Greens to make sure that we actually get this. Now is the time to be questioning our ANZUS alliance. If not now, when? With a lunatic running the Western world and a lunatic with his nuclear weapons up in Pyongyang, why are we putting our faith in Donald Trump? That's what the ANZUS alliance does: it relies on us to come to the assistance of the US.
Let me give you the words of Malcolm Fraser, Senator Brandis—through you, Chair. His last book that he wrote before he passed away was on the ANZUS alliance and why we needed to revisit it. Do you know what he said? He said that it's ironic and true that, if Australia were to be invaded or attacked, we would need the US to defend us. But what is ironic about that? It is because of the US that we'll probably be attacked. I'll let you stop and think about that. That's the unassailable logic that we are dealing with here, and it's our job as senators and MPs to debate this on behalf of the Australian people. We're not going to back off on war powers reform.
Senator Brandis, you're absolutely right, as is the defence minister, Minister Payne: there can be no more serious a decision than to send Australians off to harm's way and to war. That is a decision that should be taken away from cabinet, with its toxic internal politics, and put to the Australian people through their representatives who voted for us. We speak to the Australian people—as I did on the weekend and no doubt many other people in here did—we represent them in parliament, not the executive. No executive anywhere is going to want to give up power. But I tell you what: this is an issue that is bigger than politics. This is the most serious we can confront. We need to debate it in here and we need to vote on ANZUS and our foreign deployment. (Time expired)
Senator LAMBIE (Tasmania) (10:40): I support the motion moved by Senator Richard Di Natale because I support the fundamental value of our democratic institutions to make decisions that affect us all. Our alliances are important, because they keep us safe. The ANZUS alliance is important to us, because it has kept us safe for years. Like any alliance, it underpins the way we operate in the national security space. Our alliances also lend to the international community consistency and predictability. When our alliances stop keeping us safe and start putting us in harm's way then it is appropriate for us to at least debate that. It is the responsibility of the parliament to look after our troops because, by the time they have come home, the government of the day might be a thing of the past. We, on all sides, need to own the responsibility to properly care for our veterans. The only way to do that— (Time expired)
The DEPUTY PRESIDENT: The question is that the motion as moved by Senator Di Natale to suspend standing orders be agreed to.
The Senate divided [10:45]
(The Deputy President—Senator Lines)
BILLS
Telecommunications and Other Legislation Amendment Bill 2016
Second Reading
Consideration resumed of the motion:
That this bill be now read a second time.
Senator McALLISTER ( New South Wales — Deputy Opposition Whip in the Senate ) ( 10:48 ): Australia faces evolving national security threats to our critical infrastructure in an increasingly uncertain international environment. This includes the risk of espionage, sabotage and foreign interference with our telecommunications infrastructure, and this is the subject of this bill.
As stated in the explanatory memorandum, telecommunications networks, systems and facilities are critical infrastructure, and they are vital to the delivery and support of other critical infrastructure and services such as power, water and health. The telecommunications sector also forms the backbone of other sectors such as energy, banking and finance. To quote the explanatory memorandum:
A serious compromise of the telecommunications sector would have a cascading effect on other critical infrastructure sectors and significantly impact the Australian economy.
Our telecommunications companies are already voluntarily working with the government to ensure that Australia's critical infrastructure is safe from foreign interference, threats or espionage. This bill puts a framework around that working relationship to ensure that both government and industry know what is required to keep Australians safe and what is expected of them to ensure that these measures are taken. It also protects against the possibility that such goodwill may not be voluntarily forthcoming from all telecommunication companies at some future point. The explanatory memorandum is explicit about the regulatory approach. The proposed regulatory framework recognises the value of a formal relationship between government and industry but, importantly, it aims to achieve national security outcomes on a cooperative basis rather than through the formal exercise of regulatory powers.
This bill is the result of several years of negotiation and cooperation between the government and the telecommunications industry, arising from a broader review of national security issues by the previous Labor government in 2012. It implements the recommendations of two separate inquiries by the PJCIS in 2013 and 2015. In 2013, the PJCIS examined telecommunications security as part of its inquiry into potential reforms of Australia's national security legislation. It was recommended that the government create a telecommunications security framework in recognition of threats to Australia's national security that can be effected through the telecommunications system. In 2015, as part of its inquiry into the Telecommunications (Interception and Access) Amendment (Data Retention) Bill, the PJCIS again supported telecommunications sector security reforms and recommended that the government ensure that a framework be enacted prior to the implementation of the data retention regime. That was in April this year. These reforms were also subject to two rounds of public consultation on exposure draft legislation.
This bill seeks to provide a proportionate and escalating framework for addressing national security risks. It seeks to strengthen existing arrangements, including information sharing between government and industry. It seeks to provide increased visibility to government of national security risks and to provide greater certainty for industry about government expectations with respect to protecting networks and facilities from unauthorised interference and unauthorised access. The key elements of the bill include establishing a security obligation applicable to all carriers and carriage service providers and intermediaries, requiring them to do their best to protect their networks and facilities from unauthorised access and interference. It requires carriers and nominated carriage service providers to notify the communications access coordinator of planned key changes to telecommunications services or systems that could compromise their ability to comply with this security obligation, and notifications may be provided in the form of either an individual notification or an annual security capability plan. It provides the Attorney-General with the power to issue carriers or carriage service providers with a direction requiring them to do, or refrain from doing, a specified thing in order to manage security risks. It empowers the Secretary of the Attorney-General's Department to request information from carriers and carriage service providers to monitor their compliance with the security obligation, and it expands the operation of existing civil enforcement mechanisms in the Telecommunications Act 1997 to address noncompliance with the obligations set out in the bill.
As I noted earlier, the bill is the result of a process that was commenced by the former Labor government in 2012, and Labor has worked consistently with government to ensure our security agencies have the powers they need to keep Australians safe. This bill will provide our security agencies with the powers and tools they need to ensure that our telecommunications networks are protected from malicious actors. We take a bipartisan stance on national security legislation. In this context, we closely scrutinise all national security legislation through the Parliamentary Joint Committee on Intelligence and Security.
The bill was introduced to the Senate on 9 November 2016 and was referred to the PJCIS for scrutiny and review. The committee received eight submissions and four supplementary submissions from industry, government and academia. The PJCIS held two public hearings on 16 February 2017 and one public hearing on 23 March 2017 as well as receiving private briefings from relevant agencies in Canberra. The committee has also recently visited Telstra's Global Operations Centre in Melbourne.
The PJCIS's report on this bill made 12 substantive recommendations for improvements to the bill, to the explanatory memorandum and to the administrative guidelines that accompany the bill. Subject to these 12 recommendations being implemented, the committee recommended that the bill be passed. Labor supports the PJCIS recommendations, as we believe they improve the operation of the bill. We note that the government has also agreed to all of these recommendations.
I'd like to briefly discuss the recommendations and their effect on certain elements of the bill. Under existing legislation, the Attorney-General has the power to direct a carrier or a carriage service provider to cease its services on security grounds. This power has never been exercised. As acknowledged in the bill's explanatory memorandum, the use of this power as presently drafted may have a severe impact on innocent users of non-complying telecommunications companies as well as on Australia's economy and telecommunications infrastructure. Appropriately, this bill increases the safeguards around the use of that power. It adds a requirement that ASIO must have issued an adverse security assessment before it can be exercised and it ensures that a decision to issue a direction can be subject to judicial review.
To provide the possibility of a more proportionate response, the bill also grants the Attorney-General the power to direct a carrier or a carriage service provider to do or to refrain from doing a specified act or thing within a specified period to eliminate or reduce risks that are prejudicial to security. The types of things that the Attorney-General can direct a carrier or a carriage service provider to do must be reasonably necessary to reduce or eliminate the risk of unauthorised access or interference. There are also a number of safeguards around the use of this power. It cannot be exercised without an adverse security assessment, and the Attorney-General must be satisfied before issuing a direction that all reasonable steps have been taken to reach agreement between the government and the provider and to consult the affected carrier or carriage service provider in good faith. At recommendation 8 of its report, the PJCIS recommended that it be made clear that the Attorney-General will take into account whether the Communications Access Coordinator has complied with the applicable statutory time frame prior to issuing a direction. And, as I indicated earlier, the government has accepted that recommendation.
During the PJCIS inquiry, industry stakeholders raised concerns that the bill did not place an obligation on the government to proactively brief industry about possible threats and attacks. In their submission, Optus noticed that it would be challenging for industry to notify the government about possible vulnerabilities in their networks or infrastructure when industry may not be aware of specific threat or risk information. While noting that government already has a range of mechanisms to collaborate with industry, the PJCIS recommended that the Attorney-General's Department work collaboratively with industry to further develop this and to ensure effective and regular information sharing—in particular, sharing threat information with industry.
A key issue that was raised through the PJCIS hearings relates to the security of retained telecommunications data that is stored offshore. The Attorney-General's Department advised that the law does not currently compel telecommunications providers to tell the government where retained data is stored. The draft administrative guidelines for the bill note:
Offshoring raises security concerns because it enables access and control to critical parts of major Australian telecommunications networks outside of Australia, this can facilitate foreign intelligence collection (espionage) and disrupt the network itself (sabotage). Risks arise where control and supervision arrangements have the potential to allow unauthorised actions by third parties, such as theft of customer data or sabotage of the network.
The PJCIS expressed concern in its report on the bill that existing laws do not provide government with visibility about where and how data is being stored and emphasised that it is critical that the Australian community can have confidence in the telecommunications sector, especially the security of stored data. Pleasingly, the government has accepted the associated recommendation, specifically recommendation 10, where the PJCIS recommended that their review of the Telecommunications (Interception and Access) Act be expanded to include consideration of the security of offshore telecommunications data that is retained by a service provider for the purpose of the data-retention regime.
I note also recommendation 11, which recommends the bill be amended to include, in relation to that retained data, a specific obligation within the notification requirement in proposed section 314A to require carriers and carriage service providers to notify the communications access coordinator of any new or amended offshoring arrangements.
During the course of the PJCIS inquiry, the committee heard feedback from stakeholders about the scope and application of the bill, including concerns regarding which provisions, if any, should apply to providers of over-the-top services. At recommendations 1, 2, 4 and 5 of its report, the committee suggested amendments that address these questions around scope and application, including to make clear what a company's security obligations are in circumstances where a company is providing or selling an over-the-top service, where telecommunications infrastructure is used but not necessarily owned or operated by the company, where a company's infrastructure is located in a foreign country and uses its services to carry or store information from Australian customers or where a company provides cloud computing and cloud storage solutions. The recommendations also seek to put in place arrangements to make clear that the bill does not apply to certain broadcasters, to clarify the sorts of changes that require notifications to the communications access coordinator and to outline the application process for exemptions from notification requirements. These have been accepted by the government.
Finally, at recommendation 6, 7, 9 and 12 of its report, the committee recommended a number of accountability measures. These recommendations include making it clear that the bill does not affect the operation of existing legislated privacy; clarifying the reporting requirement to parliament, including those matters which must be addressed in the report; outlining the avenues available for industry to recover reasonable costs in certain circumstances; expanding the scope of PJCIS's review of the data retention regime; and introducing a new requirement that PJCIS review the operation, effectiveness and implications of these reforms within three years. These recommendations, which again have been accepted by the government, supplement the measures already enabled by the bill, including the ability for carriers and carriage service providers to seek merits review before the Administration Appeals Tribunal, where an ASIO adverse security assessment has been made.
Labor is pleased that the government has accepted all the recommendations of the PJCIS for improvements to this bill and commends the bill to the Senate.
Senator McKIM (Tasmania) (11:02): The Greens have been standing firmly against the government's agenda of warrantless, mass surveillance of Australian people for over five years. We have been standing up for basic human rights of Australian citizens—rights like privacy and correspondence without arbitrary or unlawful interference. Throughout this time, both the coalition and Labor governments, locked in zombie lock step, have engaged in a continual barrage of attacks against the rights of the Australian people. Both the establishment parties have stood united in their disregard for human rights, using fearmongering about national security as an excuse to continually strip back the rights of ordinary Australian people. The telecommunications sector security reforms, the TSSR, proposed in Telecommunications and Other Legislation Amendment Bill 2016 require telecommunications carriers and carriage service providers to detect telecommunications infrastructure in the national interest.
The office of the Attorney-General have the power to collect any type of information from telcos and, in turn, share this information with the AFP and third parties. Without clear guidelines as to the types of data that constitute any information, this legislation extends beyond the existing metadata creation, retention and disclosure regime. Even with the addition of clear guidelines, this legislation still represents duplication of the data retention scheme and for the same purpose. The Greens do not support this dragnet surveillance of Australians under either scheme.
A key difference under this new legislation is the government's attempt at having no defined reporting obligations. While the Attorney-General will be able to choose to collect and access private communications metadata under the TSSR, he had no intention of being held accountable to the same checks and balances, such as they are, that are in place for the metadata creation, retention and disclosure regime. Metadata collection under the TSSR does not require authorisation or notification, and the Commonwealth Ombudsman is not granted oversight powers. But, even with the clarifications of these reporting obligations under today's amendments, what guarantee do we have in this place that the Attorney-General will choose to honour them?
Today I was going to give notice of a motion for the Attorney-General to produce the Telecommunications (Interception and Access) Act annual report for 2015-16. This is the report in which the Attorney-General sets out the extent and circumstances in which eligible Commonwealth, state and territory government agencies have used the powers available under TIA Act. This is the report in which the Attorney-General tells us about the government's data retention activities for the first time. So imagine my surprise when this report was tabled this morning—at one minute to midnight: only minutes before the start of this debate in the Senate. I have seen attorneys-general in the Tasmanian parliament and the Commonwealth parliament treat parliaments with contempt on a number of occasions, but I tell you what: this one just about takes the cake. This is a ridiculous and insulting action for the Attorney-General to take, in withholding this report until, as I said, one minute to midnight—just minutes before the start of this debate today. I want to place on the record that the timing of the Attorney-General tabling this report in the Senate this morning was clearly designed to prevent this Senate from having the opportunity to analyse the information and data in that report and use that information and data to inform our position on this legislation and our contributions on this legislation—an utter disgrace from the Attorney-General.
As the new data retention obligations came into effect on October 2015, that report is the first report from the Attorney-General that includes the new obligations under the data retention act. He has deliberately held back on fulfilling his reporting obligations in a timely way, and yet here he is asking for more open-ended, obligation-free access to the private communications of the Australian people. There had been two whole years of telecommunications interception and access with zero reporting and, therefore, zero government accountability until today. The Attorney-General has held back the vital reporting on the new data retention obligations until, as I say, one minute to midnight, in an attempt to ensure that this Senate remains in ignorance about the matters contained in that report.
We have, however, had time to review the Commonwealth Ombudsman's report on monitoring of agency access to stored communications and telecommunications data for 2015-16. And what a concerning picture that report paints. It is a picture of non-compliance in record-keeping provisions and warrant conditions and restrictions from several agencies, the worst being from the Australian Customs and Border Protection Service, as they then were. Customs were found to be non-compliant or were unable to demonstrate compliance across each of the Ombudsman's inspection criteria. Customs did not have processes in place to demonstrate that they were following regulations relating to lawfully accessing, managing and keeping records of access to communications data, and the ombudsman's report indicated that they were not cooperative or frank for the inspection. That is yet another damning indictment of the now Department of Immigration and Border Protection under the bumbling, incompetent minister for immigration, Mr Dutton. Customs did not have processes in place to demonstrate, as I said, that they were lawfully accessing communications data. There were also a number of instances of warrants being exercised by a person who was not authorised across other departments, including the AFP.
This legislation that we are currently debating also gives power to the Attorney-General to direct telcos to do or to not do something to their networks in the name of national security. It is easy to understand why this is making carriers and service providers uncomfortable. The Attorney-General and the coalition government have proven time and time again that they are digitally illiterate. We have seen their ridiculous demands for access to encrypted communications, and when you add that to their long list of spectacular government system failures—the census fail, the robo-debt fail, the Centrelink and Medicare data links fail and, of course, the rollout of a substandard NBN—it paints a very concerning picture about this government's digital literacy. Let's be clear, just about every computer system the government touch turns to hashtag #fail. This government have shown that, without a doubt, they cannot be trusted to keep government networks and systems safe and secure, so why on earth would we in this place give them the power to dictate network security to the private sector as well?
The industry associations are also concerned that they could face very high costs to rebuild existing networks without limitations on the requirement for carriers and service providers to retrofit or remove existing facilities. The legislation also forces telcos to inform the government of changes to their networks. The joint submission from the telecommunications industry associations to the PJCIS warned:
… the onerous nature of the compliance requirements will act to hamper the responsiveness of … cyber threats—
as well as:
… divert scarce resources away from investing directly in addressing cyber security threats …
They also highlight the prescriptive and one-sided nature of this legislation, and point to more collaborative approaches used in places like the US, the UK and Canada. The US's cyber security act creates a framework for the voluntary sharing of cyber threat information between private entities and the federal government, with the goal of exchanging cyber threat information rapidly and responsibly. It also contains measures to protect privacy by ensuring personal information is not unnecessarily divulged. The UK's National Cyber Security Strategy also employs a far more collaborative approach, in which the government shares threat information with industry and provides advice and guidance to industry on managing risks.
The industry associations note:
… policy makers and Government should give considerable weight to the expertise of network providers in designing and safeguarding their networks and the clear commercial incentive that exists in a highly competitive sector to drive security by design in network architecture to ensure operational reliability and customer trust and loyalty.
'Trust' and 'loyalty': these are not terms that can be attributed to customers of the NBN or of online government systems at the moment, due to the government's epic fails in a range of areas that I have pointed out in this speech.
Industry associations describe this legislation as 'onerous', 'excessive' and 'one-sided'. They warn that the TSSR regime will not be adaptable or flexible enough to tackle risks that will emerge. Much like this government, it will not be agile enough to meet the challenges of the 21st century. Much like this government, it is out of step and, at the same time, it is a massive overreach. It places excessive and onerous demands and obligations on telecommunications companies, demands which are likely to put infrastructure at greater risk. It puts Australians in a position where they will have their rights to privacy stripped away without their knowledge and to no benefit in terms of the public good. It does all this with no obligations for the government to share information of threats with companies or to provide transparency of their actions to Australians.
The Australian Greens have been opposing this government's flagrant disregard for human rights to privacy and its agenda of warrantless mass surveillance of Australian citizens for more than five years, and we have been opposing it no matter what the political stripe of the government of the day. As we have done, we will continue to do by opposing this legislation. We oppose the Attorney-General collecting, storing and accessing Australians' private communications information under any scheme. We oppose the Attorney-General having a choice of schemes whereby he can pick or choose the rules and guidelines under which he accesses this private information. We oppose the Attorney-General, who has more than proven his digital illiteracy on a number of occasions, being in a position to tell telcos and ISPs how to make their networks 'more secure', likely, we point out, actually making them less secure in the process. We oppose these privileges being granted to the Attorney-General when he has already been shown to be prepared to deliberately hold back on fulfilling his reporting obligations under the existing metadata creation, retention and disclosure regime.
We oppose the government's onerous, excessive, one-sided plan to put Australian telecommunications infrastructure at risk by further imposing their incompetence on the Australian telecommunications industry. And we once again urge Australians to stand up and protect their rights to privacy as the government has shown it is not prepared to do and, in fact, that the government has demonstrated it has utter disregard for.
Why is the Attorney-General tabling the Telecommunications (Interception and Access) Act 1979 report only minutes prior to this bill being debated? Just as pertinent, when can we expect the report for the year 2016-17 to be tabled? The 2015-16 one was over a year overdue, so when are we going to get the 2016-17 report? How does the government respond to the industry associations' concerns that the underlying approach of this bill is flawed and that it is more likely to make Australian telecommunications networks less secure due to the one-sided, onerous and excessive nature of obligations for carriers and carrier service providers that constitute the massive overreach contained in this legislation? And why is the government seeking to duplicate data retention under this scheme and how will the overlapping and duplicated schemes and data be handled?
In conclusion, we have zero confidence in this government's capacity to oversee the scheme that this legislation proposes to create, because the government has shown, time after time, that they are digitally illiterate, that they treat their reporting requirements to this parliament with utter contempt and that they simply cannot be trusted to run computer systems and networks securely and to protect the private data of Australians in the 21st century.
Senator FAWCETT (South Australia—Deputy Government Whip in the Senate) (11:18): I rise to make a few brief comments about the Telecommunications and Other Legislation Amendment Bill 2016 and I do so as a member of the Parliamentary Joint Committee on Intelligence and Security which considered this bill in detail and, indeed, engaged with not only the industry players that Senator McKim has just referred to but also the government agencies that came before the government highlighting the requirement for this legislation.
The first thing I would like to point out, particularly following Senator McKim's points which go very much to the ideology of the Greens in opposing any attempt by the government to make sure that our community continues to be safe, is his conflation of two issues. He mentions, on a number of occasions, data retention as though this bill is intending to extend or somehow change the data retention requirements. In actual fact, the intent of this bill is to better manage national security risks to the telecommunications networks from espionage, sabotage and foreign interference. What the bill is looking to do is extend the work that Australia has been doing with industry over a number of years on the systems that we rely on, whether it be industry in their own business, the general public, government or security agencies. All of us now are enabled through data, whether it is on your mobile phone or on computer networks in your office. Data and telecommunications are essential, and, if we are to remain both secure economically in terms of espionage and secure from a national security perspective in terms of espionage against the state, as in government information and secrets, then we need to make sure that the system that transports that information is secure. The one reference in this bill to data retention is not about expanding and duplicating the scheme. The intent of it is saying, 'If, in your data retention obligations, you have offshored or you plan to make changes, you need to advise the government of the fact that you're making changes to a regime which is a critical part of our national security infrastructure.' There's a deliberate attempt by the Greens in this debate today to conflate these two issues. This bill is about making sure that the whole network that we all rely on is and remains secure.
In fact, the evidence taken by the PJCIS and consequently our recommendations go to address some of the concerns that have been raised around things like the transparency of information and the degree of communication from government to industry. Our recommendations say: if government becomes aware of a particular threat that industry should be taking cognisance of and where they should be acting to prevent an intrusion or a weakness in our telecommunications system, then government needs to be sharing that information more transparently with industry. In fact, this bill is about increasing the amount of cooperation and transparency between government and industry to make sure that, when we see threats, we work with industry to address them and that, when industry make changes to their networks, to the physical architecture or the contractual arrangements, which might expose Australians' information to threat, they advise government of that so that we can collaboratively work on keeping Australians safe.
My colleague Senator McAllister has stepped through a number of the details of the bill, so I'm not going to repeat all of that. There has been a bipartisan position reached on this. I just want to highlight the fact that there are two key elements where this government has been working, by and large in bipartisan cooperation with the opposition, to make sure that Australians remain safe. That's in terms of national security and countering the terrorist threat in particular but also from the economic perspective. I will start with the latter: Lloyd's, one of the world's largest insurance companies, estimates that the threat to the Australian economy is in the order of $16 billion over the next decade from cyberattack and espionage. We are under constant cyberattack, particularly from international players—and also, potentially, some domestically. Sydney actually ranks 12th of the world's major financial centres in terms of the degree of risk. Around $4.8 billion is the potential loss if cybersecurity is not taken seriously.
Whilst companies can take individual steps, the network upon which data is passed is key in terms of making sure that that data is safe. The particular company can take all the measures they like, but, if the pathways upon which that data is transmitted are not secure, then all the efforts an individual company may have made come to naught. That is why we are focused on making sure from an economic perspective that the networks are secure; hence this bill to increase the security framework of our telecommunications networks. The recommendations made by the committee were particularly to address some of the concerns that were raised by industry during the hearings. The government has chosen to accept all of the recommendations from the committee, and they form the basis of what is before the Senate today.
On the national security side, the integrity of our telecommunications system is important not only to stop intrusion but also for things like the data retention provisions. Data retention has been used for many years in Australia. It doesn't matter whether you are dealing with child pornography, organised crime or, indeed, terrorism, it is one of the most important tools that our law enforcement agencies have. So as we look back and congratulate our agencies on their 13 significant disruptions of plots to conduct terror, as we look at the fact that since 2014 more than 70 people have been charged as a result of 31 counter-terrorism operations around the country, it comes down to the fact that the government, in cooperation with the opposition, has passed eight major tranches of legislation to give our law enforcement agencies the tools they need to respond in a timely manner to a rapidly evolving threat.
You can see that threat evolving globally and even here in Australia. Over the last four or five years, we have gone from a period where terrorist plots were largely a network of people with a coordinated and complex plot that our agencies could engage with over a period of months in terms of surveillance and collecting evidence before acting to what we now see globally and even in Australia, which is that terrorist plots can be very simple, very quick and low-technology. The laws the agencies require to obtain intelligence and also to act to keep Australians safe have changed.
So this government has passed eight significant tranches of legislation, including the Criminal Code Amendment (High Risk Terrorist Offenders) Bill 2016, which was passed to allow the continued detention of high-risk terrorist offenders. A reasonable person in the street would agree that, if somebody has not renounced the ideology that made them a risk in the first place, we would be foolish to be releasing them back onto the streets while they still pose a risk.
The Criminal Code Amendment (War Crimes Act) 2016 was passed to enable the ADF to legally target members of armed groups such as ISIL in Syria and Iraq. We had the situation where some domestic law was preventing the effective engagement and disruption of an enemy that is sworn to Australia's destruction, that has been committing genocide in parts of the world. So we have passed legislation to make it possible for the ADF to be effective.
The Counter-Terrorist Legislation Amendment Bill (No. 1) 2016 lowered to 14 years the age limit on control orders. Why? Because we are seeing people as young as that involved in both the preparation and the actual conduct of terrorist acts and our community rightly expects that we will give our agencies the powers they need to deal with a threat that is evident, that is here today.
The Australian Citizenship Amendment (Allegiance to Australia) Bill was passed, providing for the revocation or renunciation of citizenship of dual nationals convicted of or engaged in terrorism-related conduct. When I go to various functions in the community in Australia probably the most frequent comment I get from men and women is: 'If somebody is engaged in terrorist acts against Australia, why do we allow them back into the country? Why do we keep them here?' This bill made it clear that, where somebody has dual citizenship and has essentially renounced their Australian citizenship by taking terrorist action against Australia, their Australian citizenship will be removed; and that has occurred.
The Telecommunications (Interception and Access) Amendment (Data Retention) Bill 2015 is not a new power; there has been data retention for many years. But with the changing commercial environment people no longer needed to retain for billing purposes the kind of information that shows person A picked up a phone and rang for 15 minutes. That is how telcos used to bill. They would look at your telephone record and charge you for the calls you made. Now that the world has moved on—through much more internet based protocols to packages where you buy up front, they have no commercial need to retain much of that information. Yet that information—whether it is child sex offences, organised crime and drugs, or terrorism—is critical to our law enforcement agencies. That bill was not about creating new powers; it was largely about preserving one of the most effective tools that our agency has. In 2014, the Counter-Terrorism Legislation Amendment Bill (No. 1) was passed enabling ASIS to assist the ADF in relation to terrorists and updating and expanding the regime to apply to enablers. Commonsense measures say that if an Australian citizen is overseas and doing something to the detriment of Australia, our interests or our allies then ASIS can help the ADF. And that people here who are enabling and preparing for an act are people we should be able to engage with as opposed to those who are actually in the act of committing a terrorist offence. The Counter‑Terrorism Legislation Amendment (Foreign Fighters) Act 2014 was passed to respond to the threat of Australians engaging in and returning from conflicts. And, finally, there is the National Security Legislation Amendment Act (No. 1) 2014.
The reason I have run through those bills is that they have been passed on a bipartisan basis in the parliament in the interests of the Australian public, and I make no apologies for those bills. The government's first priority is keeping Australians safe. This most recent bill, whilst not directly a counterterrorist bill or directly a counterespionage bill, goes to the integrity of our telecommunications and data systems which provide a vulnerability if we do not keep them secure. That vulnerability goes to both terrorism-type offences and national security as well as to our economic security through cyberattacks.
I encourage people who are interested to download the PJCIS report, where we go through both the submissions and the government's submission in detail as to why this bill is required. This piece of legislation is implementing the recommendations of the PJCIS. I particularly want to highlight that the ideological objection of the Greens is misplaced specifically in regard to this bill because it is not about increasing data retention powers. It is about saying that if a telco has an obligation under the data retention regime and they choose to change the nature of their network then they need to advise the Commonwealth so that we can have a sensible discussion about the implications. I am very happy to support this bill and commend it to the Senate.
Senator XENOPHON (South Australia) (11:32): The Telecommunications and Other Legislation Amendment Bill 2016 will amend the Telecommunications Act 1997 and related legislation with the aim of strengthening the security of Australia's telecommunications networks. Australia's telecommunications networks are an absolutely vital part of our national infrastructure, enabling us to conduct business and go about our everyday lives online. Our economic prosperity, our wellbeing and, indeed, our national security are dependent on telecommunications networks and the data that flows across them.
I don't think anyone can question the scale and seriousness of the potential cyberthreats to Australia from serious to highly organised crime, often operating on an industrial scale, to clandestine activity by foreign governments. All the publicly available advice from our security and intelligence agencies suggests— and I quote from the minister's second reading speech:
Espionage and clandestine foreign interference activity against Australian interests is extensive.
This legislation has been developed over a lengthy period of time with extensive consultation with industry and other stakeholders with exposure drafts available for public consultation and, more recently, by an inquiry by the Parliamentary Joint Committee on Intelligence and Security. The bill proposes amendments to the Telecommunications Act 1997 to place an obligation on all carriers, carriage service providers and carriage service intermediaries to do their best to protect telecommunications networks and facilities from unauthorised interference and unauthorised access for the purposes of security. Companies will have to consider national security risks such as espionage, sabotage and foreign interference threats, and the confidentiality of information and communications as well as the availability and integrity of telecommunications network facilities. This obligation will be supported by new notification obligations. Carriers and nominated carriage service providers will be required to notify changes to systems and services if the carrier or the nominated carriage service provider becomes aware that a proposed change is likely to have a materially adverse effect on their ability to meet their security obligations to protect networks and facilities from unauthorised access and interference. Early notification to security agencies should allow those agencies to provide advice at the planning stage and ensure security considerations are factored into the proposed design as early as possible in a cost-effective manner. As the minister put it in introducing the bill:
The scheme relies on a 'light touch' approach to regulation to allow for meaningful collaboration and cooperation with industry to manage risks in a way that is satisfactory to both industry and government, without the government being too prescriptive and retaining flexibility for industry.
Clearly, a close and effective dialogue between our national security agencies—especially ASIO and the Australian Signals Directorate—and industry will be essential if the legislation is to deliver the enhanced security we all seek.
The bill has now been the subject of an extensive inquiry by the Parliamentary Joint Committee on Intelligence and Security, a process that has allowed further comment and input from industry. The joint committee has made a number of recommendations that are broadly reflected in the amendments now proposed by the government. I won't go through all those amendments and recommendations. Suffice to say they all significantly improve the legislation.
I will, however, focus on one matter examined by the joint committee, and that is the question of the location of stored data. This is a very important issue. As the draft administrative guidelines accompanying the bill note, offshore data storage raises significant security issues relating both to the storage of personal information, financial and other sensitive data and, indeed, to national security. The draft administrative guidelines note:
Offshoring raises security concerns because it enables access and control to critical parts of major Australian telecommunications networks outside of Australia, this can facilitate foreign intelligence collection (espionage) and disrupt the network itself (sabotage). Risks arise where control and supervision arrangements have the potential to allow unauthorised actions by third parties, such as theft of customer data or sabotage of the network.
The Attorney-General's Department noted that the bill does not specify where or how data must be stored, but instead supports a risk based approach where companies 'can retain flexibility to support their changing business needs and to minimise any regulatory burden on their ability to conduct business internationally'. The law, as it stands and as is proposed, does not currently compel telecommunications providers to tell the government where data retained is stored. That is something I have concerns about, and I propose to raise them in my usual respected manner with the Attorney because I am concerned about the data being stored overseas. I don't think a risk based approach is adequate here, given the potential for espionage or sabotage.
The joint committee rightly observes:
It is critical that the Australian community can have confidence in the telecommunications sector and especially the security of stored data.
Australia's existing legal framework for the protection of information includes requirements under the Privacy Act and the Telecommunications (Interception and Access) Act, including mandatory encryption for retained telecommunications data as well as a recently introduced mandatory data breach notification scheme. The joint committee notes that the telecommunications sector security framework would apply to carriers and carriage service providers—C/CSPs—irrespective of whether certain parts of a C/CSP's operation are located in Australia or overseas. The location of data is not necessarily determinant of its security, but there are clear risks associated with offshore data storage. The joint committee rightly expressed itself 'greatly concerned that existing laws do not provide government with visibility about where and how data is being stored'. We need that visibility. The notification requirements proposed for the bill will require telecommunications companies to notify the government of any changes they propose to make that are likely to have a material adverse effect on their ability to comply with their security obligations. This requirement must include any decisions to store critical data offshore.
The bill does contain information-gathering powers that could be used, if necessary, to compel companies to provide information that is relevant to assessing compliance with their security obligations. The joint committee has recommended:
… that at the time of the review required to be undertaken by the Parliamentary Joint Committee on Intelligence and Security under section 187N of the Telecommunications (Interception and Access) Act 1979, the scope of the review be expanded to include consideration of the security of off-shored telecommunications data that is retained by a service provider for the purpose of the data retention regime.
The joint committee has further recommended:
… the Bill should be amended to include, in relation to data retained under Part 5-1A of the Telecommunications (Interception and Access) Act 1979, a specific obligation within the notification requirement in proposed section 314A to require—
carriers and nominated carriage service providers to notify the department—
of any new or amended offshoring arrangements.
This seems to be an essential provision, as a minimum, to ensure the security considerations are properly taken into account in any arrangements to store Australians' personal, financial or other sensitive data overseas.
My view is that I don't like it. This, to me, is putting Australians' data at too much risk. Why risk it when we should ensure that the data is stored here, onshore rather than offshore? While recognising the significant costs involved in ensuring adequate data security, I would also raise the likelihood that the so-called light-touch approach of this bill will need to be revisited in the future. Recent revelations in the banking sector suggest that very large and well-resourced companies—yes, Which bank?—can still prove shamefully negligent in failing to comply with regulatory regimes, even those relating to money laundering and terrorist financing. All too often, the pursuit of super profits and directors' bonuses can lead corporations to skate over important regulatory obligations. I suspect that this legislation will be the first in building much stronger measures to ensure the security of our telecommunications infrastructure and the protection of Australians' personal data. For the moment, I and my colleagues will support the bill and the associated proposed amendments, but we do have serious concerns in relation to the offshoring of Australians' data.
Senator LEYONHJELM (New South Wales) (11:41): I rise to speak on the Telecommunications and Other Legislation Amendment Bill 2016. The bill purports to improve national security at the cost of more government control over private telecommunications companies. The bill will introduce a new regulatory framework, supposedly to better manage national security risks of espionage, sabotage and foreign interference to Australia's telecommunications networks and facilities.
Specifically, the bill imposes a new security obligation on telecommunication carriers, carriage service providers and intermediaries. They will now be obliged to do their best to manage the risk of unauthorised access and interference, even where such access or interference does not involve committing an offence. They will also have to notify the government of planned changes to their networks and services that could risk unauthorised access and interference, even where the changes do not increase the risk of offences being committed. Of course, they will have to give information to government so compliance with these obligations can be monitored. In fairness, the directions power is limited to instances where ASIO has given an adverse security assessment and the Attorney-General is satisfied that using the power is reasonably necessary to eliminate or reduce a risk to security. Consideration will supposedly be given to the costs and impacts on competition and consumers. However, fundamentally, the greatest weight is required to be given to the ASIO security assessment.
The net effect of this bill is that consumers will get worse service at a higher cost. This is because this bill will (1) increase compliance costs on industry; (2) restrict competition, as only big established companies would put up with the red tape; and (3) distort investment away from what consumers want, as bureaucrats will make directions without knowing the trade-offs between security, cost and other features for each option and without knowing or caring what sort of trade-off consumers prefer. Government can secure its own data just by choosing ICT businesses that offer gold-standard security. With respect to private data, the government, arguably, has a role to prevent crimes—like hacking into a bank—that could hurt more than those directly involved. But the current law covers this, and there is no case to go further.
What there is no doubt about is that this bill increases regulation and costs to telecommunication service providers to the detriment of consumers and to the dubious benefit of central government. It gives ASIO additional telecommunication oversight powers and obliges telecommunication service providers to both maintain enhanced security and report breaches. Is this a vital piece of legislation to enhance our national security? The Liberal Democrats don't think so.
In a free society, intrusions into individual privacy in the interests of national security and law enforcement are based on probable cause. However, more and more we see measures taken by governments which curtail the freedom of all in an effort to monitor and prevent unlawful efforts by a tiny few. Logically, in doing this both Liberal and Labor seem increasingly to think that everyone is equally likely to be a threat. If this were true, then the fundamental basis of a democratic liberal society is called into question, and the first ideological step has been taken towards creating a police state.
We believe the current laws, effectively policed, provide more than enough powers. I will consequently be opposing this bill.
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (11:45): May I close the second reading debate by thanking honourable senators for their contributions. Let me start with Senator McAllister.
Might I acknowledge and thank the opposition for its support for this bill, the Telecommunications and Other Legislation Amendment Bill 2016. Like all of the tranches of national-security-related legislation that I have introduced into this chamber, this bill has been the subject of extensive consideration by the Parliamentary Joint Committee on Intelligence and Security. The PJCIS has recommended a number of amendments, which the government has agreed to, and I want to thank the opposition both for its support for the bill and for its contribution to the deliberative process through the PJCIS.
Speaking of which, can I also thank Senator Fawcett, who is a member of the PJCIS, for his characteristically thoughtful and well-informed contribution. I also want to acknowledge and thank Senator Xenophon for his thoughtful contribution and his support for the bill.
Senator Leyonhjelm, who has just spoken, has indicated that, effectively on libertarian grounds, he will oppose the bill. This is a position, as we know, that Senator Leyonhjelm characteristically takes. I am glad that on legislation of this kind, where government and opposition—the alternative parties of government in this place—agree that we have a contradictor; that we hear the other side of the argument from a libertarian point of view. If I may say so, there is always a crystalline elegance about Senator Leyonhjelm's contributions to this debate. He is very much a purist. But can I say to you, Senator Leyonhjelm, that in the government's view your concerns on a libertarian basis are misplaced. Your warnings about the creation of a police state are vastly wrongheaded, with respect. And, might I point out, Senator Leyonhjelm, that, if not always, then typically, you have opposed the government's national security legislation reforms.
And, might I point out to you, with respect, Senator Leyonhjelm—through you, Mr Acting Deputy President—that when on Thursday of the week before last the Deputy Commissioner of the Australian Federal Police, Deputy Commissioner Phelan, announced the charging of two people following an alleged attempt to bring down an aircraft in consequence of a plot, which it will be alleged was being conducted on Australian soil, Deputy Commissioner Phelan, who runs the counterterrorism operation, went out of his way to point out that it was because of powers given to the Australian Federal Police by this parliament in the eight tranches of national security legislation which have been introduced by this government over the last three years that the AFP was able to make those arrests and conduct that investigation so successfully, thus saving potentially hundreds and hundreds of lives.
I am not making a debating point, Senator Leyonhjelm; that was the view of the operational officer in charge of Australia's counterterrorism efforts. But it does, I think, make the point that, on occasions and only where there is a clear need to do so, it is sometimes necessary to give the police additional power in order to protect public safety. We have the endorsement of Deputy Commissioner Phelan that that has been the very effect of some of the laws that this Senate has passed after deliberation, including the contributions which you have made.
I can't say that Senator McKim's contribution had the same crystalline elegance as yours, Senator Leyonhjelm. It was a confused contribution because, with respect, Senator McKim confused the bill. He said that this was about mass government surveillance. It has absolutely nothing to do with mass government surveillance whatsoever. As a matter of fact, what this bill is to do with is protecting systems.
Senator McKim interjecting—
Senator BRANDIS: I think, Senator McKim—through you, Mr Acting Deputy President—you are thinking of another bill. It's always good counsel, if you participate in these debates, to work out which bill you're talking about.
Nevertheless, let me—having responded to those who contributed—make some closing remarks. I've already thanked the PJCIS for its contribution to the process. May I repeat that since 2014 this government, first under the leadership of Mr Abbott and now under the leadership of Mr Turnbull, has led the most significant program of national security legislation reform in a generation. The bill currently before the chamber is the ninth tranche of significant national security legislation which this government has introduced—which I have introduced—in the past three years.
The bill is a critically important piece of national security legislation, because telecommunications networks form part of Australia's critical infrastructure and also support other critical sectors such as health, finance, transport, water and power. Cyberthreats to Australia are persistent, whether they arise from sabotage, espionage, serious and organised crime or other technology enabled crime. The existing framework for managing these risks in the telecommunications industry is inadequate, and I think that fact is widely acknowledged. It relies on voluntary cooperation and goodwill, which is not always sufficient given the nature of the risks to national security and the gravity of those risks.
So this bill will address that shortcoming in the protection of the telecommunications system at the moment. It will amend the Telecommunications Act to place an obligation on all carriers, carriage service providers and carriage service intermediaries to do their best to protect telecommunications networks and facilities from unauthorised interference and unauthorised access. This obligation will be supported by new notification requirements to encourage early engagement to allow risks to be assessed and mitigated. Carriers and nominated carriage service providers will be required to notify changes to systems and services if a carrier or nominated carriage service provider becomes aware that a proposed change is likely to have a material adverse effect on their ability to meet the security obligation to protect networks and facilities from unauthorised access and interference.
Companies will also be given the opportunity to forecast changes to telecommunications systems in annual security capability plans. In line with the risk based nature of these reforms, the notification regime includes an exemptions process. This will reduce the regulatory burden on some companies and ensure that the resources of security agencies are targeted. The bill also prescribes annual reporting requirements on the operation of the legislation in an effort to improve the transparency of the regime.
Following introduction of the bill on 9 November last year, I referred it to the PJCIS for inquiry under the chairmanship of Mr Andrew Hastie MP. The committee recognised that protecting telecommunications infrastructure requires a joint partnership between government and industry. The recommendations of the committee provide great clarity and certainty for industry, encourage information sharing and enhance the transparency of the regime's operation.
In addition to the committee's inquiries, these reforms have been the subject of extensive industry consultation, beginning as long ago as 2012. Senator Leyonhjelm—through you, Mr Acting Deputy President—your observations about the burden to industry overlook the fact that this proposal has been developed collaboratively with industry through very extensive consultations that took into account industry's views. As a result, a number of changes were made to improve the operation of the proposed legislation in response to that feedback, including providing additional safeguards to govern the use of the proposed regulatory powers, clarifying the intended scope and application of requirements to be imposed on telecommunications providers, and other measures. I want to take this opportunity to thank those from industry who contributed so constructively to what has been, on any view, a very thorough consultation process.
In conclusion: the bill will establish a regulatory framework to better manage national security risks of espionage, sabotage and foreign interference and to better protect networks and the confidentiality of information stored on and carried across them from unauthorised interference and access—not surveillance, Senator McKim, but protection. There will be a set of government amendments to give effect to the recommendations of the PJCIS, subject to the committee stage. I commend the bill to the Senate.
The ACTING DEPUTY PRESIDENT ( Senator Whish-Wilson ): The question is that the bill be now read a second time.
The Senate divided. [12:00]
(Acting Deputy President—Senator Whish-Wilson)
In Committee
Bill—by leave—taken as a whole.
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:04): by leave—I move all government amendments together:
(1) Schedule 1, item 8, page 6 (line 1), omit "Note", substitute "Note 1".
(2) Schedule 1, item 8, page 6 (after line 4), at the end of subsection 313(1A), add:
Note 2: A person who uses a carriage service to supply various kinds of broadcasting services is not a carriage service provider merely because of that use (and therefore not subject to the duty imposed by this subsection): see subsections 87(1) and (2) and 93(1) and (2).
(3) Schedule 1, item 12, page 8 (line 2), at the end of subsection 314A(2), add:
; (f) the carrier or carriage service provider entering into arrangements to have all or some information or documents to which subsection 187A(1) of the Telecommunications (Interception and Access) Act 1979 applies in relation to the carrier or provider kept outside Australia.
(4) Schedule 1, item 12, page 8 (after line 2), after subsection 314A(2), insert:
(2A) Subsection (1) does not apply to changes to a telecommunications service or a telecommunications system that are changes determined in an instrument under subsection (2B).
(2B) The Communications Access Co‑ordinator may, by legislative instrument, make a determination for the purposes of subsection (2A).
Note: For variation and revocation, see subsection 33(3) of the Acts Interpretation Act 1901.
(5) Schedule 1, item 12, page 8 (after line 19), after subsection 314A(5), insert:
(5A) The Communications Access Co‑ordinator may grant an exemption under subsection (4) or (5) on his or her own initiative or on written application by a carrier or a nominated carriage service provider.
(5B) If a carrier or a nominated carriage service provider makes such an application, the Communications Access Co‑ordinator must, within 60 days of receiving the application, either:
(a) give the carrier or provider an exemption under subsection (4) or (5); or
(b) give the carrier or provider a notice in writing refusing the application, including setting out the reasons for the refusal.
(5C) Applications may be made to the Administrative Appeals Tribunal for review of a decision of the Communications Access Co‑ordinator under paragraph (5B)(b) to refuse an application.
(6) Schedule 1, item 12, page 8 (after line 20), after subsection 314A(6), insert:
(6A) An exemption under subsection (4) or (5) may specify the period during which it is to remain in force. The exemption remains in force for that period unless it is revoked earlier or it ceases to be in force as mentioned in subsection (6B).
(6B) An exemption under subsection (4) or (5) may be given subject to conditions specified in the exemption. The exemption ceases to be in force if the carrier or nominated carriage service provider breaches a condition.
(7) Schedule 1, item 13, page 21 (after line 15), at the end of subsection 315H(1), add:
Note: The Privacy Act 1988 applies to the disclosure of personal information.
(8) Schedule 1, item 13, page 22 (after line 27), after subsection 315J(1), insert:
(1A) Without limiting subsection (1), a report under that subsection for a financial year must include the following information for that year:
(a) the number of directions the Attorney‑General gave under subsection 315A(1);
(b) the number of directions the Attorney‑General gave under subsection 315B(2);
(c) the following:
(i) the number of notifications the Communications Access Co‑ordinator received under subsection 314A(3);
(ii) in response to such notifications, the average number of days taken by the Co‑ordinator to give a notice under subsection 314B(3) or (5);
(iii) in response to such notifications, the percentage of notices given within the period under subsection 314B(6) by the Co‑ordinator under subsection 314B(3) or (5);
(d) the following:
(i) the number of applications the Communications Access Co‑ordinator received under subsection 314A(5A);
(ii) in response to such applications, the average number of days taken by the Co‑ordinator to give a notice under subsection 314A(4) or (5) or paragraph 314A(5B)(b);
(iii) in response to such applications, the percentage of notices given within the period under subsection 314A(5B) by the Co‑ordinator under subsection 314A(4) or (5) or paragraph 314A(5B)(b);
(e) the following:
(i) the number of security capability plans the Communications Access Co‑ordinator received under subsection 314C(1);
(ii) in response to such plans, the average number of days taken by the Co‑ordinator to give a notice under subsection 314D(3) or (5);
(iii) in response to such plans, the percentage of notices given within the period under subsection 314D(6) by the Co‑ordinator under subsection 314D(3) or (5);
(f) the number of notices the Attorney‑General's Secretary gave under subsection 315C(2);
(g) details of the information sharing arrangements between the Commonwealth and carriers and carriage service providers in relation to this Part, to the extent that this Part was amended by the Telecommunications and Other Legislation Amendment Act 2017;
(h) a summary of any feedback or complaints made in relation to this Part, to the extent that this Part was amended by that Act;
(i) trends or issues in relation to the matters covered by paragraphs (a) to (h).
(9) Schedule 1, item 13, page 22 (after line 33), after Division 8, insert:
Division 8A—Review by Parliamentary Joint Committee on Intelligence and Security
315K Review by Parliamentary Joint Committee on Intelligence and Security
(1) The Parliamentary Joint Committee on Intelligence and Security must review the operation of this Part, to the extent that this Part was amended by the Telecommunications and Other Legislation Amendment Act 2017.
(2) The review:
(a) must start on or before the second anniversary of the commencement of this section; and
(b) must be concluded on or before the third anniversary of the commencement of this section.
(3) The Committee must give the Attorney‑General a written report of the review.
I also table a supplementary explanatory memorandum relating to the government amendments to this bill.
The government amendments give full effect to all of the recommendations of the Parliamentary Joint Committee on Intelligence and Security. The recommendations of the committee provide greater clarity and certainty for industry, encourage information sharing and enhance the transparency of the regime's operation. They include amendments to clarify that subsection 313(1A) of the bill does not apply to broadcasters that are not carriage service providers under section 93 of the Telecommunications Act and to amend section 314A of the bill to outline the application process for a carrier or nominated carriage service provider to seek an exemption from the notification requirements for certain types of changes to their networks, allowing an exemption to be time-limited and subject to conditions, providing the communications access coordinator with the ability to issue class exemptions to the notification requirements in section 314A of the bill and enabling applications to the Administrative Appeals Tribunal for review of a decision to refuse an application for exemption for notification requirements. They amend section 315H(1) of the bill to clarify, for the avoidance of doubt, that existing legislative privacy obligations continue to apply; prescribe specific annual reporting requirements on the operation of the bill under section 315J; amend section 314A(2) of the bill to ensure that a carrier or a nominated carriage service provider entering into a new or changed offshoring arrangement for information retained under the data retention regime can trigger notification requirements in respect of that change; and, finally, require the Parliamentary Joint Committee on Intelligence and Security to review the operation of the bill within three years of the royal assent.
Senator XENOPHON (South Australia) (12:06): I ask a general question which I think goes in a tangential way to the amendments that the Attorney has just moved, and that relates to the matters I raised in my second reading contribution on the bill, and that relates to the potential offshoring of data. What safeguards are there on that, Attorney? Also, is there any requirement for there to be public notification, for all to see, as to whether our data is actually being stored overseas as part of the legislative regime proposed by this legislation?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:07): Thank you, Senator Xenophon. I am glad you asked, because I'm able to give you an answer in some detail. The government is committed to ensuring that all Australians can have confidence in the security of telecommunications data irrespective of where the data is located or stored, and that is one of the most important policy values underlying this legislation.
The key risk in relation to data holdings is the extent to which they are appropriately secured. Unsecured data holdings in Australia are as vulnerable to attack or unauthorised access as data holdings held overseas. Focusing on offshoring disproportionately emphasises the risk proposed by offshoring arrangements above other types of security risks such as outsourcing arrangements, network access arrangements by persons located outside of Australia or the location of equipment. So the offshoring of data is merely one of the variety of considerations to be borne in mind in ensuring the security of data. The assessment of security risks for individual providers should be based on the full suite of risks and information available on a case-by-case basis. Australia's existing legal framework provides strong protections for information, including requirements under the Privacy Act and requirements under the data retention legislation to protect and encrypt data. Any proposal to mandate reporting of all offshoring arrangements would place a significantly greater regulatory burden on the telecommunications industry. There are approximately 280 carriers and nominated carriage service providers.
In addition to the regulatory burden on industry, assessing large datasets of baseline information would divert departmental and agency resources and focus from the more significant national security risks targeted by the reforms, including espionage, sabotage and unauthorised access and interference. This would undermine the intent of the reforms to enable greater collaboration between industry and government to identify national security risks, having regard to the particular circumstances of a provider. Where there are concerns about the extent to which an individual provider was compliant with its protection obligations, the department can use its information-gathering powers to compel the provider to provide information about the location of its data holdings, including on a retrospective basis.
The government has in any event agreed to implement all of the recommendations of the Parliamentary Joint Committee on Intelligence and Security, which includes recommendation 10, which is a recommendation that the bill specify annual reporting requirements including the number of times directions powers have been exercised, the number of industry notifications and security capability plans that have been received, regulatory performance measures, details of the government's information-sharing arrangements with industry and a summary of feedback or complaints, and which also recommended that the annual report indicate any trends or issues. And it includes recommendation 11, which will expand the scope of the review of the data retention regime commencing in 2019 to include examination of security of data that is stored outside Australia.
Senator XENOPHON (South Australia) (12:11): I am grateful to the Attorney for his response, but it still leaves me unclear—perhaps it is my muddle-headedness from the cold I have. Is there a requirement to notify consumers? If I am with a telecommunications provider, I'd like to know whether that telecommunications provider is storing data offshore. I'd imagine that that may be a marketing point of difference for some telecommunications providers—saying, 'We store our data here, only in Australia, not somewhere else.' I think it's a reasonable proposition that consumers and businesses ought to have a right to know where their telecommunications provider stores their data, because I imagine there would be many consumers and many businesses that would feel more comfortable about their data being stored here rather than overseas. My question to the Attorney is: does this legislative framework make it clear whether data is being stored overseas or not, with a particular telecommunications provider? How can consumers establish that fact?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:12): Senator Xenophon, the legislation does not provide for a mandatory obligation on telecommunications service providers to provide that information to consumers. They may, of course, if they choose to do so, and I sought to explain in answer to your initial question the reasons why there are no such mandatory obligations. There are—and I pointed this out a moment ago—very extensive oversight and reporting requirements not merely in relation to data stored offshore but in relation to all data, whether stored offshore or onshore, to protect the security of all data.
Senator XENOPHON (South Australia) (12:13): I think the Attorney has been quite open in the way he has answered this, but it still doesn't deal with the potential problem—that is, whether consumers and businesses ought to have a right to know whether their data is being stored overseas or not. Whilst this is not before the chamber now in the committee stage, is the government sympathetic to, or open to, a future amendment to the bill that would simply require information to be provided as to whether data is being stored overseas or not? I think that is a growing issue that concerns an increasing number of Australians and Australian businesses in that regard. I can foreshadow that, if the government is not interested in that, it is something that I will work with my colleagues on both sides of the chamber to try and bring about.
It would not be an onerous requirement. It doesn't actually mandate the data being here, but it simply mandates details of where that data is being stored, which I don't think, on any reasonable stretch of imagination, would be onerous on telecommunication providers. Surely they either know whether their data is going overseas or not. If it is, they ought to have an obligation to tell consumers that it is, which may, in turn, change the behaviour of some companies to think, 'You know, this is something, from a consumers' point of view, where most Australians would like us storing our data here rather than somewhere else.'
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:14): Just to make it perfectly clear: as I said before, there is no such mandatory obligation imposed upon industry or telecommunications providers by the bill. I'm advised that the matter was considered by the PJCIS. The PJCIS did not make a recommendation to that effect, but what it did recommend—and what the government has accepted among the PJCIS recommendations—is to re-look at the overall issue of offshoring, in 2019. That is recommendation 11 of the PJCIS report, which the government has adopted. Evidently there was not a sufficient level of concern about this issue by the PJCIS to recommend that the bill be amended to stipulate for a mandatory obligation initially. But in the early stages of the operation of the legislation the matter will be kept under review by the government, of course, and, as I said, we have adopted the PJCIS's recommendation to look at the matter again in 2019 with the operational experience of the legislation in operation.
I always welcome your suggestions and if you want to approach me by correspondence perhaps to ask for this matter to be revisited earlier than the PJCIS recommendation of 2019 I, of course, would always consider very carefully and with great respect any recommendation you may wish to make.
Senator McKIM (Tasmania) (12:17): Given the Attorney responded in detail to precisely none of the questions that I asked in my speech in the second reading debate, we will have to deal with them one by one in the committee stage. I do want to say, given the Attorney's taken his chance on the second reading to personally criticise my understanding of the legislation—a claim, I hasten to add, I rebut and reject entirely—that the Attorney's response to my speech was supercilious and condescending in the extreme. If they didn't invent the word 'supercilious' just for the Attorney, they could have.
Attorney: with regard to whether or not this is a dragnet surveillance of Australians—a claim that you have rejected—I am going to put some information on the record:
The Bill grants the Office of the Attorney-General (AGD), specifically the Attorney General’s Secretary (AGS), the power to collect any type of information from the TelCo:
a. This power is only overseen in terms of an annual report submitted by the AGD to Parliament.
b. This power may be delegated to the Director-General of the ASIO.
c. The ASIO may in turn share the information gathered with the AFP and third parties.
That's actually not an assertion that I am standing here making off my own bat today. What I've just done is read from a submission from the Australian Centre for Cyber Security at the University of New South Wales to the Parliamentary Joint Committee on Intelligence and Security, the closed shop in this place that the crossbench is not represented on.
It is dated 3 February and entitled Submission: review of the Telecommunications and Other Legislation Amendment Bill 2016. Attorney, in the view of the experts at the Australian Centre for Cyber Security this bill grants, in effect, you the power to collect any type of information from the telco. It is clearly a surveillance dragnet. That is an entirely reasonable description of what you are standing in this place today proposing that we agree to. So I stand by my comments I made in my second reading speech. I stand by my assertion that this government is rampantly stripping away from the Australian people fundamental rights, including the right of privacy and the right to be forgotten—key digital rights. As well, a plethora of legislation has come through this parliament in recent years designed to allow security agencies in this country to deprive Australians of their freedom, of their liberty and of their right to make choices about how they live their lives, all whilst epically failing to make any kind of case for change. I can assure the Australian people that the Australian Greens will stand up for their rights in this place. We will stand up for their right to privacy. We will stand up for the basic human rights that both the coalition and Labor members work together to strip away on a regular basis.
I will put again the first question I asked in my second reading speech that wasn't responded to by the Attorney. Attorney, why did you table the Telecommunications (Interception and Access) Act 1979 2015-16 annual report only minutes prior to this debate commencing today? When can we expect the report for the year 2016-17 to be tabled?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:22): I will turn to that, Senator McKim, but first I will address the broader observation you made. I'm afraid, Senator McKim, once again you've completely misunderstood the nature of the bill. You seem to be intending to refer to section 315C of the bill. What section 315C does is create not a scheme of surveillance but a scheme of compliance. It provides a mechanism whereby the secretary of the Attorney-General's Department or his delegate may be satisfied that telecommunication service providers are compliant with their obligations under the bill. That is what section 315C is all about. Senator McKim, because you've so fundamentally misunderstood what this is about, I'm going to read it to you. Section 315C says:
(1) This section applies to a carrier, carriage service provider or carriage service intermediary if the Attorney-General's Secretary has reason to believe that the carrier, provider or intermediary has information or a document that is relevant to assessing compliance with the duty imposed by subsection 313(1A) or (2A).
The obligations, by the way, Senator McKim, imposed by subsections 313(1A) and 313(2A) are obligations upon carriage service providers. This isn't about the surveillance of citizens. It's about the surveillance of carriage service providers. We have often heard posed rhetorically the question: who will watch the watchers? This is a provision that ensures that there is oversight of the carriage service provider—the bearers of this information—in their compliance with their obligations under the legislation. That is not at all what you suggested it was about, so either you have not read it or, if you have, you have misunderstood it. And then the section goes on to set out the way in which that is to be done.
In relation to your second question: the report was tabled this morning because it was received in time to be tabled this morning. The tabling of the 2016-17 report is some time away because there is a large amount of information to be assessed in preparing the report. When that information is assessed, the report will be tabled in a timely manner.
Senator McKIM (Tasmania) (12:25): Firstly, I want to place on the record the frustration of the Australian Greens in having to wait well over a year past the end of the 2015-16 year for the tabling of the 2015-16 report. Having acted for many years as a minister of the crown in Tasmania, I am well aware that annual reports do take some time to compile and to be provided to a minister's office. But I have to say that a delay of some 13 or 14 months is not acceptable to the Australian Greens and ought not to be acceptable to this Senate. This report has been tabled at just a couple of seconds to midnight, a few short minutes before the start of this debate. The timing is highly suspicious. If you want to assuage a small number of the Australian Greens' concerns, you could place on the record, in response to this speech, exactly when that report was received by your office. Either your office has sat on that report or the people compiling the report have taken too long to do so. One or the other of those things must be true. Thirteen to 14 months is too long to wait for a report like that.
In a supercilious and condescending way you have suggested that I either haven't read the bill or don't understand it—neither of which is true. You have again taken exception to my categorisation of this legislation. I will quote again for you from a different section of the Australian Centre for Cyber Security's submission to the Parliamentary Joint Committee on Intelligence and Security's review of the Telecommunications and Other Legislation Amendment Bill 2016. This quote is from page 3
Session Metadata as ‘any information’.
The metadata includes IP (Internet Protocol) source and destination addresses; source and destination port addresses; and protocol numbers. It therefore includes URLs / web browsing history. … This is the session metadata.
Attorney, I stand by my categorisation and the Australian Greens' categorisation of this bill as a surveillance dragnet. I make the point again that your government has got form on surveillance dragnets, specifically the metadata retention scheme.
Attorney, I also wanted to take the opportunity to give you an opportunity to respond to the industry association's explicit concerns that the underlying approach of this bill is flawed and that it is more likely to make Australian telecommunications networks less secure, due to the one-sided, onerous and excessive nature of the obligations contained in this legislation to be imposed on carriers and carrier service providers. Just so that we are clear, I would categorise the submission from the industry association that you are running a very high risk of not only an unintended consequence or unintended consequences that may flow from this legislation but, in fact, that it will be totally counterproductive—that is, it will achieve the very thing that it purports but is failing to address.
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:31): Turning to the three observations that have fallen from Senator McKim, first of all, the report was tabled within the time stipulated by the standing orders, which, I understand, is 15 sitting days. So there has been in fact no delay in the tabling of the report at all, so that statement was wrong.
Senator McKim: It was a question, not a statement.
Senator BRANDIS: Well, the answer is there has been no delay. Secondly, Senator McKim, once again, I thought by reading the actual provision to you, we would put an end to the false issue that you keep raising that this is about surveillance. The powers in section 315C—just to repeat—are not about surveillance. That is not their purpose and it is their effect. Their purpose and effect is to impose a compliance obligation on carriage service providers.
Senator McKim, you quote from evidence before the PJCIS, which I might say, parenthetically, didn't persuade any members of the PJCIS on either side of politics as to its cogency. But leaving that to one side, what you disregard is that the meaning of the word 'information' in the relevant section, section 315C, which, if you have read, you certainly haven't understood, is qualified, and you made no reference to the qualification. So we are not merely talking about any information or document, but:
… information or a document that is relevant to assessing compliance with the duty imposed by subsection 313(1A) or (2A).
So the information or documents to which section 315C is directed are only information or documents by which compliance with an obligation imposed on the carriage service providers is to be evidenced.
It is absolutely commonplace for there to be a supervisory authority which determines whether or not a compliance obligation imposed on a company, in this case, a telecommunications company, has been met. And the way in this which bill goes about that is to provide a power in the secretary of the Attorney-General's Department, not obviously a political official, to require the provision of documents of the telecommunications company, which will indicate whether or not there has been compliance with their obligations under this bill—nothing whatsoever to do with surveillance of content. That is the answer to the second observation, Senator McKim.
In relation to the third observation, may I merely say, as I said in introducing the amendments and in winding up the second reading debate, there has been a long period of discussion and consultation with industry. You would be familiar, Senator McKim, having been in public life yourself for a long time, that when new obligations are imposed upon industry, sometimes industry resists. I think it is fair to say that in the initial stages of this process—which began, by the way, under the previous government, the Labor government, in 2012—there was some resistance from some parts of the industry. However, through a very long process of consultation and discussion with industry, we have landed at a point at which the government is comfortable that the legitimate interests of industry have been accommodated. Senator McKim, I am surprised to hear you mounting an argument that could have fallen from the lips of Senator Leyonhjelm. You may feel that telecommunications service providers should live in a regulation-free environment. That has never been the case and it's not the government's view. The regulatory burden has been mitigated by the government as a result of those discussions with industry and we are now, I think it's fair to say, on the same page.
I have been given some further information, Senator McKim, on this other false issue you raise about the tabling of the annual report under the TIA Act. It was sent to my office after parliament rose for the winter recess on 29 June. The obligation under the standing orders for the tabling of the report meant that the report was required to be tabled by 14 September—that is, 15 sitting days later. Today is 14 August. So, Senator McKim, perhaps your paranoid fantasies might try to accommodate why, if the government were trying to conceal this report, it tabled the report in advance of the debate on the bill when, in fact, the government would have been entirely within its obligations to withhold the tabling of the report for another month.
Senator McKIM (Tasmania) (12:37): I ask the Attorney-General: why didn't you table it last week so we could have had a reasonable opportunity to go through that report before the start of this debate? Attorney, you just confessed to the Senate that, in fact, you've had this report for somewhere in the region of six weeks. So why wasn't it tabled last week so we could have had a good look through it and an opportunity to use the information and the data in that report to inform this debate? Instead, it was tabled today, two seconds to midnight, just before this debate started. I stand by the criticisms I have made around the timing of this report.
Let's go back to the substantive issue with regard to 315C. We could bat this backwards and forwards all day and the likelihood is, as is so often the case, we would not agree. So I am going to try to shortcut that and ask you a very simple question: is it the case that the secretary of your department can obtain from carriers and carriage service providers, should this legislation pass through the parliament and receive royal assent, information that includes an Australian person's web browsing history?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:39): I am advised that the answer to your question is no.
Senator McKIM (Tasmania) (12:39): Thank you. Can the secretary of your department obtain information that includes URLs that are visited by Australian people?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:39): I am advised that the answer to that question is no.
Senator McKIM (Tasmania) (12:39): Thank you, Attorney. I appreciate the clarity of your responses. Does the information that can be obtained by the secretary of your department, or that could be obtained if this legislation is successful, include IP source and destination addresses?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:40): The only information or documents that are able to be obtained by the secretary under section 315C are documents or information that are relevant to assessing compliance by the telecommunications company with the duties imposed by section 3131A or 3132A. In other words, assessing whether the telecommunications companies or carriage service providers have performed their compliance obligation. I'm advised that that does not include customer data.
Senator McKIM (Tasmania) (12:40): Okay, thank you, Attorney. You said it does not include customer data, so I am asking you—just so that we are being abundantly clear here—about whether this legislation would provide the capacity for the secretary of your department to access such information. It is not whether it is the intent of you or anyone else that that occur, but just whether this legislation provides a framework that delivers to the secretary of your department the capacity to source that information?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:41): No, Senator, because, as I am advised and as is plain from reading section 315C with the obligations imposed by section 313, no such information would be relevant and therefore would not fall within the meaning of information or documents as described by section 315C.
Senator McKIM (Tasmania) (12:41): Thank you again, Attorney. I have gone through the list of session metadata that was provided to the Parliamentary Joint Committee on Intelligence and Security. I want to be very clear in my understanding of your responses, so I will just ask you, I guess, a broad question: is it your advice to this Senate that there is no capacity, should this legislation become law, for the secretary of your department to source from carriers and carriage service providers IP source and destination addresses; source and destination port addresses; protocol numbers; URLs; or web-browsing history?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:42): I think I have already told you, Senator. I am advised that such information would not answer the description of that provided for by section 315C.
Senator McKIM (Tasmania) (12:43): Yes. Is that advice you have just given based on legal advice that you have obtained?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:43): Well, the officers of the Attorney-General's Department who advise me and who are responsible for this legislation have a very thorough knowledge of the legal aspects of this bill.
Senator McKIM (Tasmania) (12:43): I think we'll take that as a no. Attorney, do you accept, in any way, that there is an overlap between this legislation and the metadata retention scheme? That is, will any information able to be sourced and assessed through the metadata retention scheme also able to be sourced under this legislation?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:44): First of all, I want to chastise you for your very unchivalrous and rude reflection upon those who advise me—as I have tried to point out to you, those who advise me are not only qualified lawyers who work for the Attorney-General's Department but they are specialists in this area of the law, with a specialist knowledge of this bill.
Senator McKim, the purpose of the metadata retention legislation was to impose an obligation to retain metadata for a period and for the purposes set out in that legislation. This legislation, as I have pointed out to you several times now, is concerned with something completely different—that is, creating a system for creating a framework for the protection of telecommunications systems. In order to better protect the security of information carried by telecommunications systems and by carriage service providers, it imposes obligations upon those companies and carriage service providers of the kind that I have described in the second reading speech and in summing up the second reading debate. The issues are completely different.
Senator McKIM (Tasmania) (12:45): I can assure your departmental officers that I have no reason to believe they are anything other than consummate professionals who take their jobs very seriously. Just so that we can all understand what I meant when I said 'legal advice', I was specifically referring to formal legal advice obtained from either the Solicitor-General or his office or the Australian Government Solicitor or the office of the AGS. Those are the organisations to which I was referring when I said that I think we can take the answer as a no.
Attorney, thanks for your response on the previous question. Can I ask you now about any oversight powers that may exist for the Ombudsman in regard to any information sourced under this legislation. Will the Ombudsman have oversight powers as the Ombudsman does with metadata collected under the metadata creation and retention disclosure scheme?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:46): Senator McKim, the Ombudsman's jurisdiction is as set out in his act. The operation of that act is not excluded by this legislation.
Senator McALLISTER (New South Wales—Deputy Opposition Whip in the Senate) (12:47): I indicate that the opposition will be supporting the government's amendments. As I indicated in my second reading remarks, they do implement the recommendations made by the PJCIS, and it is our view that they will improve the operation of the legislation.
I also indicate, in response to some of the remarks made through the course of the second reading debate and the committee's proceedings, that the opposition does recognise there are grave risks and new risks that arise from having a society so intimately and integrally dependent on digital and that managing telecommunications risks is at the heart of managing against those more general risks. There have been remarks through the course of the debate that indicate that we could expect telecommunications service providers to manage these risks as a commercial imperative. I would submit to the Senate that that I think misunderstands the nature of the risk and the commercial imperative as it applies to these businesses. It is true that in most instances it will be in the commercial interests of a telecommunications service provider to meet national security objectives. Indeed, the experience so far has been that these service providers have engaged constructively with government. However, it is possible to imagine a circumstance where national security objectives do not align with the commercial imperatives of a business. Under those circumstances, the directors of that company would find themselves in a difficult situation. At least one impact of this legislation would be to create comfort for directors who now have an active obligation to manage, as best they can, national security in the operation of their business.
I also wish to remark briefly on the debate that has taken place around offshoring and, in doing so, to note that there is a distinction between security risks to data that is voluntarily provided by a consumer of telecommunications services and security risks to data that is held as a result of government legislation—specifically, retained metadata. That distinction was recognised by the committee and in part is reflected in the recommendations made by the committee that there ought to be special consideration given to security obligations around retained metadata. The government amendments now provide that, where changes to the handling of retained metadata are being contemplated by a telecommunications service provider, they need to notify government that that is the case, and the opposition believes that that is appropriate.
As previously, I indicate that we're supportive of these amendments and commend the bill overall to the chamber.
The TEMPORARY CHAIR ( Senator Bernardi ): The question is that amendments (1) to (9) on sheet JC433, standing in the name of the government and moved by Senator Brandis, be agreed to.
Question agreed to.
Bill, as amended, agreed to.
Bill reported with amendments; report adopted.
Third Reading
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (12:51): I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Competition and Consumer Amendment (Misuse of Market Power) Bill 2017
Second Reading
Consideration resumed of the motion:
That this bill be now read a second time.
Senator GALLAGHER (Australian Capital Territory—Manager of Opposition Business in the Senate) (12:52): The Competition and Consumer Amendment (Misuse of Market Power) Bill 2017, which is before us today, seeks to implement the so-called effects test, and it certainly will have an effect—an overwhelmingly negative one. It will have the effect of chilling competition and reducing innovation, and it will affect the prices that Australians pay for goods, in a very bad way. What the government is seeking to implement is bad law. It has not been thought out at all, and it will have a deleterious impact.
The Australian people should get no comfort from the fact that, according to leaks from the cabinet, the Prime Minister, the Treasurer, the Minister for Finance, the Attorney-General and the Minister for Revenue and Financial Services all think this is a bad idea. Given these names, how could this bill possibly have come forward? It's clear that they were rolled by the Deputy Prime Minister. It's a very bad thing for the nation when it's the Leader of the Nationals calling the shots in relation to competition policy in Australia.
What the proposed effects test means is that, instead of looking at the intention of a company with significant market power, you would look at the effects of their actions, particularly if the effect of their action is a substantial lessening of competition in any market. You could understand why this would look like something that should be done. I don't deny for a second that there are issues and problems which need to be addressed, and I will turn to Labor's alternative plan for doing that.
The fact of the matter is that these issues have been addressed, looked at and considered in Australia for a long time. Since the early 1970s, there've been 12 reviews of competition law in Australia, and 10 out of those 12 reviews recommended against an effects test. These have been reviews by serious people looking at this in a very considered fashion. The overwhelming majority have recommended against the implementation of an effects test. The 1976 Swanson committee recommended against an effects test on the basis that the section should only prohibit abuses by monopolists that involved a proscribed purpose. The Blunt review in 1979 recommended against it on the basis that it would 'give the section too wide an application, bringing within its ambit much legitimate business conduct'. The 1984 green paper recommended an effects test, one of only two of the last 12 competition reviews to do so. The 1989 Griffiths committee said that there was 'insufficient evidence to justify the introduction of an effects test'. The 1991 Cooney committee said that an effects test 'might unduly broaden the scope of conduct captured by section 46 and challenge the competitive process itself'. In 1993, the Hilmer committee recommended against an effects test, saying it 'would not adequately distinguish between socially detrimental and socially beneficial conduct'. In 1999, the Baird committee said that 'such a far-reaching change to the law may create much uncertainty in issues dealing with misuse of market power'. The 2001 Hawker committee recommended against an effects test and said it would 'await the outcome of further cases on section 46 before considering a change to the law'. The 2003 Dawson review said the addition of an effects test would 'increase the risk of regulatory error and render purpose ineffective as a means of distinguishing between procompetitive and anticompetitive conduct'. The 2004 competition inquiry by the Senate Economics References Committee said that, while the committee was sympathetic to some of the arguments, the difficulties with introducing it meant that the committee did not recommend the inclusion of an effects test.
It is a well-understood principal of competition law, and the law generally, that, if a business with market power intends to reduce competition for its own benefit, this should be dealt with. This is not acceptable behaviour, and it should be dealt with. Companies with substantial market power should not act to reduce competition for their own benefit. That should not be their intention. But it is a dangerous leap to change this principal and to disregard the intent of the company and, in effect, outlaw a company making life more difficult for their competitors simply because they are innovating or increasing their own competitiveness. It is a dangerous time for Australia when the National Party is dictating economic policy like this.
This has been through a Senate inquiry, and the critics of the bill were very clear in their views. The Business Council of Australia criticised this bill and opposes it very strongly. You have companies opposing this government, which claims to be probusiness and which lauds its probusiness credentials right around the country. These companies are going to the Senate inquiry and saying this is a bad idea, whether they be BlueScope or Woolworths. They are saying this not just because of the intent of the government in doing this and because he government is designing a system which would reduce the competitive juices in the economy, but also because of the way the government has gone about it. The way the government has gone about it creates uncertainty and a lawyer's picnic. The only people who will be happy with this will be competition lawyers. Despite the fact that they think this is bad policy, many lawyers in Australia will nevertheless see the commercial opportunities that will abound because of this government's ineptitude.
Another sign of the government's ineptitude in relation to this policy was the Treasurer at the last minute introducing amendments to the bill and briefing the media about it before the bill was finally dealt with in the House. What these amendments went to was to remove certain defences in the bill, the mandatory safeguards which were recommended to be put in by the Harper review. The Labor Party broadly believes the Harper review was very good; we obviously disagree on this effects test. It was recommended that these safeguards be put in. The government's amendments were described as an 'astonishing amendment from a supposed free market government'. These are not my words. They're not even the words of the shadow Treasurer or the shadow Assistant Treasurer. They are the words of the Business Council of Australia. That is what the group which the government goes around the country lauding for its support of the big company tax cuts thinks. Mr Grant King, the President of the Business Council, is quoted as saying in relation to this bill:
The Turnbull government seems intent on putting pressure on the household bills of every Australian … The proposed 'effects test' is so broad and ambiguous that companies risk being sued by their competitors merely for offering discount prices for consumers.
The government’s latest amendment removing ‘mandatory factors’ completely disregards Ian Harper's recommendation that safeguards are needed to protect against legitimate competitive conduct being captured.
The mandatory factors didn't provide nearly enough protection for legitimate business conduct, but the answer should have been to improve them, not to remove them altogether.
Mr King and the Business Council are right about these points.
On our side of politics we are not prone to agree with the Business Council on every occasion, but we call it as we see it and we will say when they are right—and they are right about this issue. We could've engaged in politics and supported the government and said that we would crack down on these nasty big businesses, but consumers would've paid the price for that and consumers will pay the price for that if the government succeeds in getting this legislation through the parliament.
The fact of the matter is that there are issues that need to be addressed. Labor is the party of competition reform. We're the ones who have always delivered serious reform. The first federal competition law in Australia, which was an issue with the Whitlam government, was the Trade Practices Act. That was the first serious national competition law that we had. Consumers affairs protection was included in that as well. Then there were the competition policy reforms of the Hawke and Keating years. The national competition policy was a key reform in leading to the 26 years of uninterrupted economic growth that we've had in this country and it improved the competitive juices of our economy. Then we had, coming together with the reform of the competition act, the criminalisation of cartel conduct and the harmonisation of consumer affairs laws across the country under the Rudd government.
So our side of the House is pro competition. We believe that the beneficiaries of competition are the people we are here to represent, people going about their business and wanting a good deal from the economy, because competition produces that good deal. But competition policy must be finely calibrated and carefully designed, not written on the back of a coaster in a hotel, as the Deputy Prime Minister likes to boast that he does from time to time—that he writes his ideas for competition policy reform down on the back of a coaster in the Birdsville Hotel.
The proposal put forward by the Labor Party and taken to the last election—and, indeed, passed by this chamber last week—is a much better solution to the challenges that small businesses face. Because some big businesses have deep pockets and armies of lawyers, the risk of a small business being overwhelmed and having to pay the big business's legal fees if they take on a competition action against a big business is very substantial, and it means that it doesn't happen as often as it should.
This is not just about the ACCC enforcing the law. That has its place and is an important part of it. But businesses can begin and bring their own actions as well. At the moment they're not doing that, for very understandable and legitimate reasons. They are concerned that the court case would be very expensive and that they may well have costs ordered against them and that that would drive them out of business.
Indeed, the policy which we enshrined in draft legislation and which passed this chamber last week sought to address that with our access to justice bill, the Competition and Consumer Legislation Amendment (Small Business Access to Justice) Bill 2017. I would urge the government to consider supporting that when it goes to the House and changing the position of their vote from last week. This access to justice reform has been welcomed by the Business Council of Australia and by the Australian Small Business and Family Enterprise Ombudsman, who also believed it was a practical way to assist small business in addressing the level playing field issue.
The access to justice reform was welcomed, as I said, by the Business Council of Australia, and it would be a sensible and practical support for small businesses around Australia—unlike this legislation, which was originally opposed by the Prime Minister, the Treasurer, the finance minister, the Attorney-General and the minister for revenue, but which was, apparently, supported by the Deputy Prime Minister and insisted upon by the Deputy Prime Minister as part of the coalition deal when the Prime Minister rolled the member for Warringah in the party room. That was the price for keeping the peace. And it is not the way to write economic policy in this country.
This will impact on the cost of living of Australians by putting upward pressure on prices. It stands to reason that if you have a big business or even a medium-sized business that has substantial market power in one particular market, they will talk about how they can improve their operation in that market, and they may say: 'Let's discount—let's go on a discounting process; let's reduce our prices; let's be more competitive,' but now there will be this effects test in the way, if this legislation passes, and they may have to say: 'But this might affect some of our competitors; some of them might actually go out of business if we're as competitive as we possibly can be. If our prices are as cheap as they possibly can be, some of them might actually be adversely reflected.'
Every boardroom and every manager will now have to consider that, and not just consider that in a national sense but consider their approach to smaller markets and their approach in any particular market segment. Even if their intent is not adverse, which in many cases it will not be, if the effect of their actions is adverse then they will be taken in by this piece of legislation. This is a fundamental change to the principles that have underpinned competition policy and competition law in Australia for many decades, certainly since Commonwealth control and Commonwealth authority in the 1970s.
This bill also contains amendments that would repeal the telecommunications-specific anticompetitive conduct provisions in part XIB of the Competition and Consumer Act. Currently, part XIB provides the ACCC with powers to take speedy action and better resolve disputes when anticompetitive conduct is suspected. This allows disputes to be resolved faster and more cheaply than by relying on general competition law. Given the concentrated nature of the telecommunications market, it remains appropriate to preserve this section. Labor considers that the stronger powers under part XIB remain necessary to deter misuse of market power. There is no good case for the repeal of this particular section of the act, and the government has not been able to put forward a single credible argument. It is a reckless approach to policymaking and sums up the incoherence of the Turnbull government. Labor will not support this repeal.
There is no way, given the weight of expert evidence from competition lawyers in Australia, that sensible commentators in the competition space think this is a good policy, because it's not. It should be resisted by sensible Senators opposite. As we know, it was resisted originally—to give them credit—by the Prime Minister, the Treasurer, the finance minister, the Attorney-General and the Minister for Revenue and Financial Services. You would think that that would be enough to maintain the position for sensible policy within the Cabinet. But, in another sign of this government's weakness, the Prime Minister, the Treasurer, the finance minister, the Attorney-General and the Minister for Revenue and Financial Services have been rolled on this important matter of economic policy.
On this side of the chamber we are of one mind. We stand for good policy, and this is not good policy—quite the contrary. This is very bad policy. As I have said, there have been 12 reviews of this since the 1970s and 10 have said that this is a very bad idea. It should be resisted and opposed here in the Senate. Thank you.
Senator McKIM (Tasmania) (13:07): I rise to speak on the Competition and Consumer Amendment (Misuse of Market Power) Bill 2017. The effects test is a very necessary change to competition law that will basically make it easier for the ACCC to crack down on anticompetitive behaviour. For too long in this country we have sat back as a parliament while major corporations have been able to abuse and misuse their market power to the detriment of smaller players, to the detriment of primary producers and to the detriment of the Australian people. I commend all of those people and organisations who have worked so hard for so long to bring about this important reform.
I also want to acknowledge the work of my friend and colleague Senator Whish-Wilson, who for a long time has carried the torch on this issue for the Australian Greens. He has advanced this debate and the campaign through his work in this place. As a result of the work he has done, I have no doubt that he contributed significantly to the outcome that I believe we're about to see when this legislation passes through this place.
As I said, there is a range of people, organisations and political parties who support an effects test. It is odd, very odd indeed, given all the people, all the organisations and all the political parties that are lined up in support of an effects test in Australia, that it is the Labor Party who stands alone alongside the Business Council of Australia as a voice against an effects test in this place. How odd. How very odd! The Labor Party voting against a law that is supported by progressive people—a law that actually is progressive, a law that looks after the little guys in their endless fight against big corporations, a law that takes on big business and a law that's good for competition, good for consumers and good for the economy.
How could this be? How could it be that the Labor Party is the sole voice against this legislation? I will tell you how it could be. I have got three letters for you: SDA. The Shop, Distributive and Allied Employees Association—the 'shoppies', as they would be better known to the HR departments of Coles and Woolworths. The shoppies have a good thing going with Coles and Woolworths. They've got a good thing going with Maccas, KFC, Hungry Jack's and a host of others in the retail and fast food industry in this country. This is the good thing they've got going: every time a 16-year-old or 17-year-old signs up for eight hours a week pushing trolleys, stacking shelves or flipping burgers, their employer slips them a membership form for the SDA. It's a regular part of the paperwork: 'Sign here, here and here and you are good to go.' That's right. Those employers unionise these kids the day they get a job.
Mr Acting Deputy President, you might be thinking, 'That's amazing.' You might be thinking that means we live in a workers' paradise. Unfortunately, nothing could be further from the truth, because these kids are just numbers to the shoppies. The shoppies have cynically exploited these kids and others who are part of one of the lowest-paid and most casualised workforces in this country for decades just to get the numbers. The shoppies started trading away penalty rates well before Tony Abbott and Malcolm Turnbull thought it was fashionable—
The ACTING DEPUTY PRESIDENT ( Senator Bernardi ): Senator McKim, I would ask you to refer to members of the House by their appropriate titles.
Senator McKIM: The shoppies started trading away penalty rates well before Mr Abbott and Mr Turnbull thought it was fashionable, and they did so just to get the numbers. The shoppies, according to no less of an authority than the full bench of the Fair Work Commission, signed off on a workplace agreement that resulted in more than half of Coles workers being paid less than the minimum rate. That's right. Let's be clear about what happened there. The shoppies got its members a worse deal than what they would have gotten had there been no deal at all, just to get the numbers—numbers in preselection, numbers in this parliament and numbers on the floor at the national conference of the ALP, all so they can push their retrograde social agenda.
The shoppies are a relic of a bygone era in this country. They're a relic of the old Catholic right that kept the Labor Party so divided for the better part of 20 years. The shoppies carry the ghost of Bob Santamaria, and that ghost stalks the halls of this building to this very day as a result of the way the shoppies conduct themselves. They are an anchor on the ALP and a handbrake on progressive politics in this country. Every time Labor tries to go forward, there are the shoppies holding them back. We could have had marriage equality five years ago in this country if it weren't for the shoppies. We could have had truly needs-based education funding in this country—the original Gonski—if it weren't for the shoppies. In all likelihood, we would have an effects test years ago if it weren't for the shoppies. When something like the effects test comes up, the shoppies' allegiances are not with their members and not with the broader public; they are with the companies that their business model is built upon, because what's bad for Coles and Woollies is bad for the shoppies.
So it is that Labor stands alone in this chamber today. I have got no doubt this sticks in the craw of a good number of Labor senators who see this legislation for what it is: good law and a necessary legislative change. Bound as they are by factional pacts, those Labor senators will vote against it today.
Those who defend the shoppies by saying that its members should organise to change their union if they have issues fall for the same faulty logic as those who support individual agreements. There is a power imbalance. How on earth is a 16- or 17-year-old who is pushing trolleys, stacking shelves or flipping burgers meant to overhaul the political-industrial complex that is the shoppies in this country? I have a short answer for you: they can't. That's why some have set up an alternative union—a real union that's got its members' interests at heart rather than being obsessed with what people get up to in their bedrooms.
The Retail and Fast Food Workers Union are taking on the shoppies, and strength to their arm and good luck to them. I hope they break the shoppies wide open and end this rotten situation in our country and within the Australian Labor Party that is doing no-one any good. Strong unions are good for this country. Strong unions have delivered the weekend to Australia. They've brought us health and safety protections and minimum wage laws. But, when a union uses its strength to cosy up to big companies like Coles, Woolies, KFC, Macca's and Hungry Jack's and screw over its workers, someone needs to call it out. That's what I'm doing here in the Senate today.
The SDA is a shocking advertisement for unionism to the hundreds of thousands of young workers who start their first job in retail or fast food only to find out their union is the reason they're getting screwed and paid below the award. The SDA gives unions a bad name. It will put off some young Australians from being union members for life.
This is a good law. It's law that the Australian Greens have led the campaign for over many years in this place. We've advanced the arguments, we've worked closely with a range of small-business stakeholders and we stand here today and will vote accordingly and proudly for an effects test. We stand here today proudly opposed to the unholy alliance of big corporations, the shoppies and the Labor Party in this place. I say again to the good senators of the Labor Party—and there are many of those good senators in the ALP—have a think about your position on this. Stop allowing yourselves to be manipulated by the SDA. Stop allowing yourselves to be directed by one of the great forces of conservativism in this country—the SDA.
Senator BERNARDI (South Australia) (13:18): I have to say at the outset that I was somewhat conflicted about how to go on this bill, because I am a free marketeer. I do believe markets are, in general, very good, but I'm being tortured by what Senator McKim has said: that this bill is somewhat a progressive agenda and an initiative of the Greens. If ever it's going to turn off my vote, he's nearly done it! But I hate to say that he's got a point. Free markets only work where there is a level playing field, if you will. As I remarked in the Senate last week, there is not a level playing field for small business in this country.
When I'm talking about small business, I'm not so much talking about the medium-sized businesses that have an HR department that can do those things. I'm really concerned for the mum and dad operators—the ones that put their financial lives on the line. They sacrifice a lot of family time and mortgage their houses to live the dream and start a business. Sometimes they don't pay themselves; they struggle and pay their employees. I find it extraordinary, just extraordinary, that these small businesses, which have to deal with the bureaucracy and the red tape that government foists upon them—they have to deal with the industrial relations laws that are an impediment to employment; they have to deal with onerous taxation requirements and occupational health and safety requirements—just to live their part of the dream, are also having to compete with big business that has been allowed to trade away employee entitlements to benefit the union movement.
Senator McKim is happy to put his anti-Catholic rhetoric out there and blame the shoppies union and the ghost of BA Santamaria and so forth. Let's dismiss the Greens' hatred of religion, unless it's the worship of the earth, and deal with the facts. It is wrong for a union to be able to do a deal with business that benefits the union and disadvantages the worker. That is absolutely wrong. We know there is a huge track record of this. Mr Shorten himself is as guilty as sin in this respect. I do note that the minister said, in effect, under the laws about corrupting benefits for unions that were changed last week, that Mr Shorten would probably find himself charged with an offence were he to do the same thing again today.
I am also quite sympathetic to the shoppies union, as Senator McKim said. They are a bastion of conservativism, or they were until recent times. That doesn't mean they are perfect. There is only one pure conservative party in the place and the shoppies are welcome to join it any time they'd like to. I'll straighten out their sharp edges, if you like, and we can ensure there is a voice for conservativism across the political divide. But they've done the wrong thing here, and I cannot, in good conscience, stand and defend big business, notwithstanding the benefits they provide to the Australian people. They provide stacks of jobs, they provide opportunities, they invest and all of those things, which are positive, so I'm not anti-big business, but I am absolutely pro small business.
On balance, this gets the balance right in protecting small business. When I say 'protecting', I mean in trying to level the playing field as much as it can. This is the great torment for us; there's no perfect science in this. Do you say, 'Big business will misuse its market power?' Yes, that benefits consumers in the short term and they can provide lower priced products, but I also know that competition is absolutely vital. If I look at Coles and Woolworths—it's easy to beat up on them, and I will—they have been charging Australian consumers far in excess of what their international competitors do from a margin point of view, which means the cost of our groceries, the cost of our goods and services are far greater here than they should be. Australia is a high cost-of-living country.
This is also compounded by the fact that small business is not effectively able to compete where there is a misuse of market power, there are onerous obligations, there is a huge potential for legal consequences and costs incurred simply to have the fight and have the battle. You can be mobbed in small business via lawfare that will cost you hundreds of dollars every time you have to respond to a legal letter from one of the big businesses, and it is simply onerous. Sometimes small business goes, 'It's just too hard.' We need to be able to get some legal redress here.
But I'm talking about the very smallest businesses. I know that later on you're going to have a discussion and one of the senators will come in here and talk about misuse of market power, and they're going to be defending a big supermarket chain that is not Coles or Woolworths. They will be defending them and saying, 'This is a small business that's really struggling.' A small business that turns over $100 million a year is not that small a business, as far as I'm concerned. Similarly, it would be no coincidence that this small business that a senator later on will talk about will no doubt mention on the public record that all the employees of that small business were given time off or paid to man their polling booths for them. Let's not pretend that some of the strongest advocates in this space are not absolutely self-interested.
What I can tell you is that I'm interested in making sure that small business in this country gets a fair go. I want to make sure that Australian consumers get a fair go. In order to do that, it sometimes means trading off the short-term immediate benefits that come with a lower price tag, which eventually drives out competition and leaves a market monopoly or a duopoly. I'm very happy to see that change. I'm happy to see the international entrants come into this space—in the retail space, in the consumer goods space—but, more importantly, I want small businesses to be able to have a crack. That means they've got to be able not only to source their products but to run their businesses on par.
If there was any doubt about my support for this test, it was effectively nullified when I recognised just what the union movement had done in trading away workers' rights so that Coles and Woolworths could get some sort of competitive advantage—as if they didn't have it already—and so that the unions themselves could benefit from it. This is the most self-interested behaviour. It was Sir Robert Menzies, who would be an Australian Conservative today—if he were alive I am sure he would be—
Senator Williams: He would be a Nat!
Senator BERNARDI: No, he wouldn't be a Nat, Senator Williams. It is about the forgotten people who don't have that voice for them anymore. They don't have the budgets to hire lawyers, expensive accountants and lobbyists to patrol the halls of Parliament House. They're the people who don't have an HR department. Their HR department is their kitchen table every Sunday night. They're the people who can't afford to engage or employ a union or pay off a union, effectively, to get better deals for themselves. They're the people who are the forgotten ones in our country. They're the ones who provide the engine room, the growth and the innovation for our economy. They're the ones who employ people. Government and unions, unfortunately, now seem to be putting a roadblock in their way at every single turn. Whether it be about the bureaucracies I mentioned, whether it be about taxation, whether it be about HR impediments or whether it be about unfair advantages that the union has negotiated for big business at the expense of small employees—however you want to do it—small business is up against it all the time.
Unashamedly, I'm a fan of small business. I started in small business, and my family's been involved in it for our entire lives and continues to be involved in it. I know exactly what it's like for people to make a go of it—and make a success, I have to say. But the success doesn't come without a whole bunch of pain along the way. No-one sees the pain except the families involved in it. Sometimes the employees see it. No-one sees the pain except the two people or the one person engaged in it with the stress. People only see the success at the end, but I can assure you nothing is further from the truth.
In conclusion, I will be supporting this—not without reservations, I have to say—because I do like competition. I do like competitive forces and I like markets that are free so that people can compete on a level playing field with innovation.
Senator Williams: And fairness.
Senator BERNARDI: Senator Williams makes a good point: it is about fairness but not in the sense of social justice, equality, or anything like that. It is about fairness where you know that, if you can source a product, you can sell it at a reasonable price or at a fair price, but you also know that your competitor across the road is not able to pay $3 or $4 less an hour because of some cosy sweetheart deal that's taken place. These are the questions that often go through the minds of people who believe in something. We've got to balance the ideal scenario against what we can achieve.
I don't want the perfect to be enemy of the good. I think, in the end, that the good—and what is most important and what is so important for this country—is for small business to have that fair go and to have that opportunity to grow into medium-sized businesses. I have no horse in this race apart from that. There is no-one that's going to be paying their employees to man my polling booths for me. There are no lobbyists that are making massive donations to my political campaign or to my union. The only interest I have is in the mums and dads of Australia, so that they can have a business they want to make a go of and make a success, because their success is our success.
Senator WILLIAMS (New South Wales—Nationals Whip in the Senate) (13:30): I would like to contribute to this debate on the Competition and Consumer Amendment (Misuse of Market Power) Bill 2017—certainly not for 20 minutes, but just to put a few points on the record.
This recommendation is a result of the Harper review, and it is about maintaining competition. Let me expand on that. If you start a small business and you start to become successful, one of two things is going to happen: big business, the big end of town, are either going to buy you out or they are going to squash you out. Make no mistake about that: if you're a threat to big business they will squash you out.
For years I have asked the question: how do we make section 46 effective? The purpose test simply has not worked. I have had many discussions with a bloke I have a huge amount of respect for, Mr Allan Fels, the former boss of the ACCC. Allan Fels was telling me: 'You need an effects test.' Let me explain this to those in the chamber and those in the gallery.
If I were part of a big multinational company, say we had 300 stores, and we started up a branch in a country town that had a successful small business just poking along, employing seven, eight or 10 people, we could sell at cost—we could sell at a ridiculously low price. Under the purpose test, if I were a small business and I or the ACCC had to take them to court to prove that the purpose for that big business selling at half price was to send me broke, that was a very difficult case to prove. Now, with the effects test, I can simply go to the ACCC and say, 'The effect of this big business charging $10 for some product in all their stores around Australia but charging $5 in the store opposite me in the street is sending me broke.'
This is about maintaining competition. I'm surprised the Labor Party are not supporting this. This is about maintaining competition and seeing competition that means small businesses can survive. I give an example: I know many small businesses—the corner stores. Where do they buy their cans of Coca-Cola? They go to Coles and Woolworths and buy their Coca-Cola there when it's on special. Why? Because they can buy it cheaper at a retail price from Coles or Woolworths than they can by buying directly from Coca-Cola. That is a fact. Why? Because when Woolworths and Coles order their Coca-Cola, they order in umpteen pallets. They bulk purchase, with a big discount. The small business at the corner of the street can't do that.
That is what the direct responsibility of the amendment to section 46 of this legislation is: to see the effect of the business is not to use their power, their strength and their might simply to squash a small business or to move into town—especially in country towns—and squash a small business that has been established there. It could have been a family business that might have been there for generations; it might be the local IGA. But the big business can't go in and say: 'Righto, this town is growing. It's got a good future. We'll sell it at half price or even less,' simply to cripple and shut down their opposition.
That is unfair, and as Senator Bernardi said, it is about fairness. I believe that life is about fairness, and the current section 46 is not treating small business fairly. That's why we need this amendment. As I said, and I will repeat it, it is to maintain competition. If we're going to have a situation where the big end of town, the multinationals, can squash their small businesses in competition, we're going to have three or four companies run this nation in retail.
Master Grocers Australia has welcomed the bill. The National Farmers' Federation says that the effects test will help protect Australia's 135,000 farm businesses from unfair marketplace conduct, which will in turn drive innovation and jobs growth for the Australian economy. The Australian Small Business and Family Enterprise Ombudsman strongly supports a business environment that allows small businesses to participate in markets and to compete on their merits alongside larger businesses. This freedom depends on the existence of a level playing field, where those with substantial market power are effectively prevented from using that power to lessen competition.
The Institute of Public Accountants highlighted the effect that Australia's concentrated market structure has on competition, noting that small or medium-sized businesses are vulnerable to exploitation or exclusion by firms with substantial market power. The current situation is simply David and Goliath; and, as the biblical story says, it is not often that David wins. So this should be supported from all around the chamber. I am very confident that Senator Xenophon and his team will support this. Senator Xenophon and I, and many others in the National Party, especially Senator Canavan, and many in the Liberal Party as well, have been on about this. Craig Kelly is one who says this might not be the whole answer but it may be helpful. But we cannot have this situation for small business. I am referring largely to small business in the smaller regional cities and growing regional towns, not so much the big cities. But certainly it could be the case in a big city that a big business comes in and cuts the price; and it can do that because of its bulk purchasing power, the huge volumes that many of these big businesses purchase when they order their stock.
I think this is a very fair piece of legislation. As I said, it will encourage competition. The more of your opponents you can cripple and shut down the less competition there is. It is good to rely on small businesses for service. Small businesses are renowned for good service and the friendly service they provide, but there's a limit on that when it comes to price. You can provide all the service you want but if you're double the price of your competitor, customers will look for the discounts and the best deal, especially to save a dollar with the cost of energy prices and so on. Here is a situation where we will have some fairness in the market through this effects test, some fairness with the powers given the ACCC under section 46 and some fairness to not only allow existing small businesses to survive but to give incentive to future generations of Australians who want to start a small business. This will say: if you want to mortgage your house on a low-doc loan, if you're going to have a go, we're going to make a level playing field out there; we're going to see that the big end of town doesn't do the Goliath bit and stomp on you.
This legislation is very fair. I question why some opposite are not supporting it. I question why they are anti-small business and supporting big unions and big business all the time. Small business is the biggest employer in our country. They are the hard workers. Many in small business do not have superannuation and do not pay themselves penalty rates. They work on weekends and public holidays to save costs because they simply cannot afford to employ many people on weekends and public holidays. They work hard and deserve to be rewarded for their efforts. This legislation adds weight to that. It is a sad situation when we lose something in Australia. I think hard work should always be rewarded. But under the current legislation, the purpose test in section 46, hard work is not enough. It is very disappointing when people work hard only to find that they get put down the financial tube, their business goes belly up, because of the power, might, purchasing power, tactics and strategies of huge businesses, multinational businesses in many cases, who simply squash their opponents. I commend the bill to the Senate and I hope for support. If Labor and the Greens are not supporting this bill—I hope the Greens are: Senator Whish-Wilson has been very familiar with small business in his life. And I hope the crossbenchers support this bill to give a go in this very competitive world.
Senator WHISH-WILSON (Tasmania) (13:39): Let me start by putting it on the record that the Greens will be supporting this legislation. In fact, the Greens have campaigned for an effects test in section 46 for nearly five years. Prior to my entrance to the Senate, Christine Milne had campaigned on this. She was from a farming background and worked very closely with and was very popular with Tasmanian farmers. She understood the pressures on supermarket supply chains over a number of years, and she had seen the dairy industry reduced to nearly a quarter of its size from numerous pressures, including being squeezed by the big supermarket chains. This is something my party has long campaigned on because we support small businesses, rural communities and our farmers. Let me also make it very clear and be up-front that there is the policy aspect of this and then there is the political aspect. I think it helps to cover off on, to quote Peter Garrett, 'the power and the passion' behind any particular piece of important legislation when it comes to parliament and goes through the political process to become legislation and, hopefully, ultimately, law. I will make some brief comments on that.
Let's start with the policy. Competition policy in this country is reasonably complex. There are a large number of components to competition. The one that has caused the most controversy over time is section 46. Section 46 is designed to prevent the misuse and abuse of market power or market concentration. Essentially, it is unworkable—section 46 in its current form is unworkable. This is something I talked about last week when Labor brought their private member's bill into this place. I quoted the ACCC. Mr Sims, who we all think does a really good job with the war chest he has available, has been making it clear that section 46 is unworkable. The Harper review, instituted by the government, also recommended that section 46 be changed, to introduce an effects test.
Probably the best analogy I have read, which simplifies what is fairly technical and complex detail, is that it is similar to the difference between a manslaughter charge and a murder charge. Currently, the way section 46 is set out, for any death you would need to prove motivation for murder. We have all grown up watching detective shows—Law and Order and those kinds of things on TV—and we know that a manslaughter charge is different to a murder charge. It has a lower burden of proof. The comparison is a really good one with the misuse of market power under section 46. The way section 46 is structured at the moment, you have to prove murder. You have to prove intent; that anticompetitive behaviour is designed to stamp out your competition. The reason it has been unworkable is that it has been almost impossible to prove intent. However, if you look at the effects of the action of a company that does stamp out competition, and that can be proven, then you have your manslaughter. You have your lower burden of proof. It is actually a really interesting and easy to understand comparison. The way that competition law is set out at the moment, it is virtually the same as trying to prove a murder charge where a much higher level of proof is required, and you have to prove motivation and intent. Whereas, over time, we see that markets fail and there are important roles for regulators to play and very tough regulations and laws to prevent, for example, market concentration, where monopolies and duopolies exist and crush competition. Lack of competition is not just bad for consumers, it is also bad for those who provide the inputs into the supply chain, like farmers and distributors. It is actually a really important debate.
Section 46 is not workable. Don't take my word for it. Let's hear what the ACCC have to say. In their submission to the Senate Economics Legislation Committee, Mr Rod Sims in his submission said:
The ACCC continues to strongly endorse the proposed, simplified reformulation of the misuse of market power provision of the Competition and Consumer Act 2010 (CCA) (section 46).
They go on—and, senators, it is well worth reading this if you have not read it—to talk about a number of objections to the adoption of a lessening of competition which is called an SLC, and a test in section 46 of the CCA. In this submission, they debunk the myths that have been put out there by those who oppose an effects test. No guesses who the power is behind this debate when we are talking about the power and the passion. It is big business. As we heard from Senator McKim, I think quite surprisingly to most Australians, behind that big business is also a big union—the SDAs, who we call the 'shoppies'—and the deal they have done with big business.
Mr Sims goes through, talks about the purpose of an effects test and refutes, one by one, the arguments that have been put in place; for example, that an SLC test is novel or uncertain. On the contrary, he says that it is a 'well understood test that is applied in the majority of the other competition provisions of the CCA, including anticompetitive agreements, mergers and acquisitions.' But there is more. He then goes on to talk about arguments that adopting a SLC test will prevent or deter competition. He says:
The adoption of an SLC test will not restrain large businesses from competing on their merits, reduce productivity, chill investment or lead to higher prices.
And he sets out all the reasons why. Labor's key argument here today is that somehow this is going to lead to higher prices. Mr Sims also refutes arguments that a SLC test will remove the causal connection between market power and conduct or that amending section 46 would impose an unreasonable burden on large business. He then deals with mandatory factors, which are the key arguments we have heard from Labor today.
Obviously, the Labor Party missed the appendix to the submission by the ACCC, but it sets it all out in easy-to-understand detail. Labor found some examples of where an effects test under a new section 46 of this new legislation, if it gets up, would be different from the existing section 46. They talk about anticompetitive conduct like land banking, locking up supplies, restricting supplies of essential materials, retaliatory threats by big business, joint marketing fees, freezing out competing suppliers from retail display and demonstration opportunities, targeting price discounting strategies by an incumbent designed to dissuade new entrants in a region and tying up customers in long-term contracts with anticompetitive clauses. I once again thoroughly recommend senators read this simple, easy-to-understand table because it sets out these overly simplistic and misleading arguments provided by the Labor Party today as to why they are not opposing this regulation.
A lot has been written about and discussed in the public debate about the supermarket duopoly. Believe me, they are a stark example of the misuse of market power in this country. There is the perception—and the reality—that many farmers and small businesses have been squeezed by their ferocious war for market share over the last few years. We have the most concentrated grocery market in the world. Up to 70 per cent of the grocery market and in some cases, I have heard, up to 80 per cent including the now take-away liquor market is controlled by the duopoly. These big supermarkets have cornered nearly 50 per cent of Australia's petrol market by using their size and their muscle. They are amongst the top 20 retailers in the world. Of course, they appeal to customers by suppressing prices, by discounting and by campaigning as price suppressors. But, at the same time, they have massively increased profits. You might scratch your head. Any first-year economics student might say, 'Wait a second. That does not sound right, Senator. How have they managed to get away with it?' They have got away with it by transferring over $2.5 billion in profit from the food producing and the food manufacturing side of Australia—so think of farmers, out struggling to make a living; small businesses struggling to provide distribution, provide food and also compete with them on a retail level—to the retail side of the business over the last seven years. So the question you would ask is: what is the future for food producers and how can they keep going if they are continually being squeezed and driven towards being unprofitable? That is the other side of this debate.
The Greens, as I said earlier today, are proud to have been campaigning on this issue now for a long time with farmers and with small business. We have some amendments which I will deal with when we go in committee, and I will certainly talk about Senator Xenophon's amendments and any other amendments we may see.
Let me get to the politics side of this now. I am going to talk about politics on both sides of this chamber today, Labor and Liberal. I put a motion to the Senate, just by coincidence, nearly two years ago for an effects test to stand with farmers and small business. Much to my surprise that day, my Green colleagues and I were joined on this side of the chamber by the National Party. The entire National Party Senate team crossed the floor to vote with the Greens on our motion on the effects test. I'm not going to divulge confidences, but I did say to those senators, 'Thank you for standing with farmers and small businesses today.' They thought that was quite funny. They said, 'No, Senator, thank you. Today we are negotiating with Mr Malcolm Turnbull on forming a new government.' That's right—it was the same day that Mr Malcolm Turnbull knifed Mr Tony Abbott in the back and took the leadership of the Liberal Party. Perhaps, as these strange coincidences occur, the politics is that the Liberal Party had done a deal with the National Party to bring in an effects test, and that was what helped underwrite Mr Turnbull's leadership as Prime Minister of this country.
I only say this not because it's a bad thing but because I am worried that there are senators on the other side of this chamber who fundamentally and philosophically disagree with an effects test that makes life harder for big business. I hope that they are going to stick this legislation through and not put any poison pills into this or any future legislation that could help unwind this very important piece of legislation today.
I was very surprised when I heard that the Labor Party weren't going to support an effects test. I didn't know why. I scratched my head like a number of other people did. That decision was obviously made a long time ago. We heard from Senator McKim, and I read some transcripts from media articles on the power that the shoppies union has over the Labor Party. The only conclusion I can draw is that Labor, through their relationship with the shoppies, are in bed with big business. They were in here spouting on about the Business Council for nearly 15 minutes and supporting big business. At least they acknowledged that wasn't a normal thing for them. If it wasn't a normal thing, what's so special about this particular legislation?
We know that the donations to the Labor Party through the shoppies and the connection to Coles, Woolworths and Wesfarmers are black and white. I suspect that Labor voting against this bill today, regardless of the faux arguments they put up for not supporting an effects test, because of their donations. If that is true, that is rotten to the core. If they are voting against good legislation that helps improve our competitive landscape and helps make it easier for farmers and small business because this is going to impact their support and donations, I think that's not going to go well for them with small businesses and farmers in this country who expect us all, without fear and favour, to look at these things in the cold, hard light of day and take every opportunity for reform that we can when we see it.
I say to any farmers, small-business people or groups out there who are looking at this debate, it's important I put on record today that this is not a silver bullet for fixing all your problems in the competition space. This will certainly make it a lot easier for the ACCC to prosecute cases of misuse of market power. I gave some examples where the ACCC has stepped out and why an effects test in section 46 will make it easier, but it isn't a silver bullet. It's not necessarily going to stop a new supermarket opening in their area. It's not necessarily going to stop aggressive price discounting. But it will make life a lot easier.
But it's not just a supermarket duopoly. It's big business everywhere that should be worried about an effects test being introduced if they are conducting anticompetitive behaviour. That's what we want. We want the right tools in the toolbox for Mr Sims at the ACCC to be able to conduct his job in the most efficient and effective manner possible.
My example that I would like to talk about today in the few minutes I have left is King Island off Western—off North West Tasmania. It kind of is of Western Australia, in a way—I don't think I can spin my way out of that one too easily. I went to King Island and the farmers there used to have an abattoir and they used to have their own brand: King Island Beef. It was arguably the best brand in the country.
JBS—a big, aggressive company, which Senator Heffernan had lots to say about when he was in this place—came in, bought the abattoir and shut it down. What then happened to the farmers was that they didn't have their own abattoir so they had to put their cattle on boats, which was terrible for the cattle. It was not only cruel for the cattle but it also affected the quality, the MSA, of their beef. The farmers have essentially now lost their brand and have to sell their cattle to other producers on mainland Tasmania.
I went over there and I thought: 'That's a bit unfair. Why don't we see if we can buy this land off JBS?' They had an entire abattoir set up, including a $5 million facility paid for by the Australian taxpayer for treating effluent to allow the abattoir to keep going and to modernise it. They refused to sell the abattoir or any of the equipment or the land to the farmers who wanted to buy it back and control their own destiny.
I was interested because I not only wanted to help these small businesses and these farmers but I also didn't want to see the cattle to be put on these boats in one of the roughest stretches of water in the world. I wrote to the ACCC and they wrote back to me and said, 'Unfortunately, unless you can prove intent, unless you can prove that JBS bought that abattoir to shut it down to consolidate their market power in the cattle market, you've got no chance. So, no, we're not going to investigate it.' Guess what? Unfortunately, this legislation is not retrospective, but I reckon, under these laws now, we could mount a pretty good case that that company did have a marked effect on the profitability of those farmers on King Island. That's a real example of where I have participated in this debate and tried to work with stakeholders—local farmers and small businesses—to help them out.
The way competition law is now under section 46 makes it next to impossible to succeed. That is something we can fix. We can fix this today. We can make life easier for the ACCC. We can make really clear-cut cases of anticompetitive behaviour. We can cut them out, and we can stand up for small business and small farmers. It's not often we get to see legislation where we can actually make a difference. I will argue here today—and strongly urge senators to look at this piece of legislation—that it's not a silver bullet. Farmers shouldn't be relying on this to solve all their problems, nor should small business, but it does go a long way to improving competition policy. Please don't let politics and the power ruin this chance to actually fix this.
Let's go back to my quote on the power and the passion in this place. I would argue that the Labor Party only putting up one speaker on this bill, this really important piece of competition legislation, suggests that there is no passion in the Labor Party for this piece of legislation; no passion for opposing it and no passion for supporting it. I was really surprised that Labor only put up one speaker here today. I sense that they would like this to pass quickly and that they would like it to go away. And that's a real shame, because this is something my party has campaigned on for nearly five years. It's a rare opportunity to help fix the competitive landscape in this country. It's a rare opportunity to stand up for small business and farmers in this country and say: 'We did our bit. We'll continue to work with you on what else needs to be fixed.' This is an opportunity to support the ACCC chairman and CEO. Get out there—help Rod Sims prosecute the case against what we know is anticompetitive behaviour, misuse of market power and market concentration solely to underwrite the fat margins of big business at the expense of farmers and small business in this country. Let's pass this legislation.
Senator Di Natale interjecting—
The PRESIDENT: Senator Di Natale, we're almost at 2 pm—
Senator Bernardi interjecting—
The PRESIDENT: I won't entertain a point of order, Senator Bernardi, on that. Senator Brandis, I gather there are no ministerial announcements that you need to worry about?
Senator Brandis: No, I don't have any ministerial announcements for you, I'm sorry, Mr President. So I'm afraid there won't be an opportunity to keep the time going until two o'clock.
The PRESIDENT: That is fine. It now being 2 pm, we now proceed to questions without notice.
QUESTIONS WITHOUT NOTICE
Deputy Prime Minister
Senator CAMERON (New South Wales) (14:00): My question is to the Minister representing the Prime Minister, Senator Brandis. Today, the Deputy Prime Minister told the House of Representatives that he has asked that the question of his eligibility to be elected under section 44 of the Constitution be referred to the High Court. When Senator Canavan made a similar statement, he also said, 'Given the uncertainty around this matter, I will stand aside until the matter is resolved and resign as the Minister for Resources and Northern Australia.' Can the minister explain why Senator Canavan was required to step aside but the Deputy Prime Minister has not?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:00): Yes, I can. There are obvious factual and legal differences between the two cases. However, in view of the fact that the matters are now before the High Court—
Opposition senators interjecting—
The PRESIDENT: Order on my left.
Senator BRANDIS: it would not be appropriate to engage in discussion of them, lest to do so would limit any submissions the Solicitor-General may wish to make.
The PRESIDENT: Order! A point of order, Senator Hinch?
Senator Hinch: I'm having trouble hearing the Attorney-General's microphone.
The PRESIDENT: Thank you. I did notice that the volume was down a bit.
An honourable senator interjecting—
The PRESIDENT: Order! And there was a bit of noise on my left, as well. I call the Attorney-General, and hopefully we'll be able to hear you this time.
Senator BRANDIS: Do you want me to start again?
The PRESIDENT: Yes, that would be great. Thank you, Attorney-General.
Senator BRANDIS: Yes, Senator Cameron. There are obvious factual and legal differences between the two cases. However, in view of the fact that the matters are now before the High Court, it would not be appropriate to engage in discussion of them, lest to do so would limit any submissions the Solicitor-General may wish to make. Suffice it to say that, when acquainted with the situation on 25 July and on the basis of his understanding of the facts at that time, Senator Canavan decided that he would prefer to stand down. The facts of Mr Joyce's case are much clearer to us than were the facts as known to Senator Canavan at the time he made his decision. And, on the basis of those known facts and clear Solicitor-General advice, the government does not consider that there is sufficient reason for Mr Joyce to stand down.
The PRESIDENT: Senator Cameron, a supplementary question?
Senator CAMERON (New South Wales) (14:02): Oh, very interesting! Last week, the Attorney-General told the Senate that, based on advice from the Solicitor-General:
… it is the government's preliminary view that … Senator Canavan … is not in breach of section 44 of the Constitution.
Can the minister confirm that the government has less confidence in Senator Canavan's position than the Deputy Prime Minister's?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:03): That is not the case, Senator. The proposition that you've put to me is incorrect. And might I, through you, Mr President, counsel senators against treating this purely as a party political matter. It is in the interests of the parliament, and in the interests of the nation, that the meaning of section 44.1 of the Constitution be clarified. And for senators to ask questions of the kind that has just come from Senator Cameron, which can only be designed or at least have the effect of potentially damaging any argument that might be put before the High Court, is a reckless thing to do.
The PRESIDENT: Senator Cameron, a final supplementary question?
Senator CAMERON (New South Wales) (14:03): Can the minister confirm that the reason for the different standard is that the government depends on Deputy Prime Minister Joyce for its majority in the House of Representatives?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:04): No.
Taxation
Senator HUME (Victoria) (14:04): My question is to the Minister for Finance, representing the Treasurer, Senator Cormann. Can the minister please explain why high taxes are bad for growth, for jobs and for wages?
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (14:04): I thank Senator Hume for that question. Increasing the overall tax burden in the economy reduces our international competitiveness. It makes it harder for us to attract additional investment to strengthen growth and create more jobs. It makes it harder to attract the investment necessary to boost productivity, which is, of course, a necessary ingredient to increase real wages over time. Increasing the overall tax burden in the economy, in particular in the way that the Labor Party is proposing—targeting success, targeting aspiration—will lead to worse economic outcomes. There's absolutely no question about that. It will. It is designed to make it harder for business to be successful, which means it would make it harder for business to employ more Australians and to pay them better wages.
I've seen that the Labor Party has been quibbling with the assertions that have been made about the level of additional tax burden that Labor is proposing to impose on the economy. What we would say to the Labor Party is this: tell the Australian people. I'll tell you what we say you want to impose in terms of additional tax burden on the Australian economy. We say you want to increase taxes on small- and medium-sized businesses and businesses overall by $65 billion over the next 10 years. We say you want to increase the tax on housing through your negative gearing changes by $32 billion over the next 10 years. We say you want to increase taxes on housing, through your capital gains tax changes, by $13 billion over the next 10 years. We say you want to increase taxes on small business in particular, through your trust changes, by $15 billion over the next 10 years. We say you want to increase personal income tax by increasing the top marginal tax rate on a permanent basis by $22 billion over the next 10 years. And we say you want to increase taxes on superannuation by $20 billion over the next 10 years. You tell us which one of these numbers is wrong. More importantly, you tell the Australian people.
The PRESIDENT: Senator Hume, a supplementary question.
Senator HUME (Victoria) (14:06): I thank the minister for his answer. Can he expand for the Senate on why it's so important to limit the amount of tax that the government imposes on the economy?
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (14:06): The government, indeed, has imposed a limit on itself, in terms of the tax burden in the economy, and all of its revenue forecasts in the budget are based on an assumption that tax, as a share of the economy, tax as a share of GDP, will not go past 23.9 per cent. Labor will blow that limit out of the water, with disastrous negative consequences for the economy and for jobs.
Senator Cameron: Yes, and we'll spend it better than you.
Senator CORMANN: We had an interjection there from Senator Cameron that Labor would spend the money better. That is, of course, exactly what this is all about: 'Tax more to spend more', irrespective of the damage that it would do to the Australian economy along the way.
We have delivered tax cuts for small- and medium-sized business already. We've delivered tax cuts for 3.2 million small- and medium-sized businesses, which will help them be more successful. More successful small- and medium-sized businesses mean more jobs and better wages, and Labor should support the remainder of the tax cuts.
The PRESIDENT: Senator Hume, a final supplementary question.
Senator HUME (Victoria) (14:07): Can the minister explain how the Turnbull government's plan to reduce taxes is supporting economic growth and the creation of new jobs?
Senator Cameron interjecting—
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (14:08): Here we have the socialist conscience of the Labor Party interjecting again, dismissing our plan for a more competitive business tax rate as 'trickle-down economics'. Let me explain it very carefully for the Senate and for the senator who has just interjected. Helping businesses be more successful means they can hire more Australians and pay them better wages. For individual Australians to be the most successful they can be, the businesses that employ them have to be as successful as they possibly can be. Unless you actually ensure that people across Australia have the right incentives to pursue aspirations, to pursue success, then we let everybody down. Suggesting that we should pursue a culture of equality means that we will drive the situation for Australians down to the lowest common denominator, to a level of mediocrity. That is what the historical failure of socialism has shown all around the world. We don't want to take Australia down the path of mediocrity and the lowest common denominator. (Time expired)
Broadband
Senator O'NEILL (New South Wales) (14:09): My question is to the Minister for Communications, Senator Fifield. The chief operating officer of TPG recently said, 'With fibre to the node, we're not even allowed to lodge a fault with NBN unless the line performs less than 12 megabits per second.' Does the minister consider this practice to be fair to consumers, or is this simply what Australians should expect on the second-rate copper NBN?
Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (14:09): Colleagues would be aware that one of the reasons the NBN is being rolled out much faster than was the case under our predecessors, and why it will be completed at significantly less cost is because of—
The PRESIDENT: Senator O'Neill, a point of order?
Senator O'Neill: Yes, Mr President. I'm aware that the senator is only shortly into his time, but this is a speaking point that we've heard on multiple occasions. It's not related to my question in any way, which asked the minister to consider the practice of retail service providers lodging a fault with NBN and them being unable to do so unless it's less than 12 megabits per second. The question goes to: is this practice fair to consumers, or is it simply what Australians should expect of a second-rate copper NBN? We don't need to hear the minister's speaking notes again, thanks.
The PRESIDENT: Thank you. In relation to the second element of your question, the minister was directly relevant to that point, and I'll call the minister. You did acknowledge yourself that the minister has only just recently commenced his answer.
Senator FIFIELD: Thanks, Mr President. As I was saying, it's precisely because of the multitechnology mix approach adopted by this government that the NBN will be completed six to eight years sooner than would otherwise have been the case, and at about $30 billion less cost.
The senator is quite right: part of the multitechnology mix is the deployment of the fibre to the node. Now, if colleagues will look around the world, it is extremely common that a multitechnology approach is taken around the world because it's recognised that you've got to deploy the technology that makes sense in a given area. If it makes sense, for instance, to use the existing HFC pay TV cable, then use that. If it makes sense to deploy what we're calling fibre to the curb, then that should happen. If fibre to the node makes sense, do that; if fixed wireless makes sense, do that; and if the use of satellite is what is most sensible in a given area, then that should be used.
That is the approach that we're taking, and of course—
The PRESIDENT: Order! Senator O'Neill, a point of order?
Senator O'Neill: Mr President, with 30 seconds to go, the minister has not approached any detailed conversation about the 12 megabits per second. Is that a satisfactory point at which complaints can be lodged?
The PRESIDENT: I acknowledge that, Senator O'Neill, but the second part of your question was: is this what consumers should expect? I think the minister has clearly outlined what consumers should expect. The minister has been directly relevant to the question, and I call the minister.
Senator FIFIELD: Thank you, Mr President. If a consumer has an issue with their NBN service, their first point of contact should be the retail service provider. The retail service provider, where they believe there's an issue with the NBN network, will then liaise with the National Broadband Network. That is actually the design of the scheme put in place by those opposite.
The PRESIDENT: Senator O'Neill, a supplementary question?
Senator O'NEILL (New South Wales) (14:13): Given retail providers say that NBN refuses to investigate problems where the line speed is not below 12 megabits per second, what advice does the minister have for Australians on the copper NBN, who are paying for 50 megabits per second but can only receive a maximum of 14 megabits per second?
Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (14:13): I think, as colleagues here would know, there can be a range of reasons why a consumer is receiving speeds lower than they expect. It can be the case of the in-house wiring. It can be the case of the modem that the individual has. It can be a function of the amount of capacity that a retailer purchases. What I encourage all consumers to do, if they are not satisfied with the service they are receiving, is contact their retail service provider. If they're still not satisfied, they should contact the Telecommunications Industry Ombudsman.
We think it's very important that there is transparency about what is happening with the NBN. That's why we've charged the ACCC to deploy 4,000 probes in premises around the nation, so that there will be visibility in terms of the speeds that retailers are providing.
The PRESIDENT: Senator O'Neill, a final supplementary question?
Senator O'NEILL (New South Wales) (14:14): Thank you, Mr President. Given the Turnbull government has set a minimum service level of 25 megabits per second in its statement of expectations, what is the minister doing to ensure Australians with a copper line speed below 25 megabits per second can have their NBN problems investigated in a fair and transparent manner?
Senator FIFIELD (Victoria—Manager of Government Business in the Senate, Minister for Communications and Minister for the Arts) (14:14): As I was just starting to outline, where consumers believe that their retailer has not provisioned their service as it should, that is a significant matter, and that's an area where we expect the ACCC to investigate. I have written to the ACCC asking them to investigate such cases. The ACCC has issued six principles to retailers to guide their advertising. The ACCC will shortly be providing further guidance to retailers. But, as I say, this is an area where we want transparency. That's why I asked the Australian Communications and Media Authority to engage in an exercise of compulsory information receipt from retailers and others in the supply chain for the NBN network.
Registered Organisations
Senator PATERSON (Victoria) (14:15): My question is for the Minister for Employment, Senator Cash. Is the minister aware of any recent reports about conflicts of interest relating to donations from registered organisations to activist groups?
Senator CASH (Western Australia—Minister Assisting the Prime Minister for the Public Service, Minister for Employment and Minister for Women) (14:16): I thank Senator Paterson for the question. Yes, I am. It was revealed over the weekend that a significant donation was made in 2005 from the Australian Workers' Union to GetUp!. This was when the current Leader of the Opposition, Mr Shorten, was the national secretary of the AWU. Based on the reports, Mr Shorten's union donated the sum of $100,000 to GetUp!. In addition to being the national secretary of the AWU at this time, Mr Shorten was also a board member of GetUp!, a supposedly independent organisation.
Despite being asked questions about these serious matters, and the potential conflict of interest, Mr Shorten has today failed to provide answers and has merely referred the matter to GetUp!. Unsurprisingly, we're still waiting for answers. But there are very serious questions that Mr Shorten has to respond to. He needs to provide evidence that this $100,000 donation was within the AWU's rules. AWU rule number 57 states:
A loan, grant or donation, must not be made by the Union or any Branch as the case may be, unless the National Executive of the Union has:
(a) Satisfied itself:
(i) that the making of the loan, grant or donation, would be in accordance with the Rules of the Union; and
… … …
(b) Approved the making of the loan, grant or donation.
So the question for Mr Shorten is a simple one: was this $100,000 donation of AWU members' money validly authorised under the rules?
The PRESIDENT: Senator Paterson, a supplementary question.
Senator PATERSON (Victoria) (14:18): Why is it important for the persons who authorised this donation to publicly account for their role in the decision-making process?
Senator CASH (Western Australia—Minister Assisting the Prime Minister for the Public Service, Minister for Employment and Minister for Women) (14:18): The $100,000 donation made to GetUp! is provided by the members of the AWU, hardworking Australians whose union should act in their best interests, not in its own. It is unconscionable that their membership fees could be spent on boosting Mr Shorten's political profile rather than fighting for their best interests. As senators will recall, HSU members' money was spent by Craig Thomson, as national secretary of that union, on his own political campaign, without authorisation of the union's rules. Again, Mr Shorten needs to answer the questions: was the $100,000 donation from the AWU authorised under the union rules, and did Mr Shorten declare a conflict of interest?
The PRESIDENT: Senator Paterson, a final supplementary question.
Senator PATERSON (Victoria) (14:19): Is the minister aware of any similar reports relating to payments from registered organisations?
Senator CASH (Western Australia—Minister Assisting the Prime Minister for the Public Service, Minister for Employment and Minister for Women) (14:20): Yes, I am. The donation is not an isolated incident. When Mr Shorten was the AWU national secretary, the AWU made another generous donation, to the Labor campaign for the federal seat of Maribyrnong, where, as it happens, Mr Shorten was the Labor candidate. The donation was made on 14 September 2007.
Mr Shorten has again failed to answer similar questions in relation to this donation. A very simple question: was it made in accordance with the AWU's rules? The rules are clear on what constitutes valid authorisation. Again, Mr Shorten needs to come clean and advise the Australian people whether the rules were complied with in both of these instances and whether in both instances he declared his conflicts of interest.
Marriage
Senator RICE (Victoria) (14:21): My question is to the Minister for Finance regarding the government's planned postal plebiscite on marriage equality. The Australian Bureau of Statistics have announced that people have to be 18 by 24 August to participate in the government's postal plebiscite. By my calculations, using the ABS's own census data, this means that over 50,000 18-year-olds who turn 18 between 24 August and 7 November will not be able to vote. Can the minister confirm that this is the case?
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (14:21): The first point I would make is that in any exercise involving the electoral roll there is a deadline after which no further updates can be made to the roll. The second point I would make is that if Senator Rice is now arguing that it would have been preferable to conduct a full, compulsory, personal attendance plebiscite, the government would agree with that. But given the Greens and others decided not to support the government's preferred way of giving all Australians a say on whether the definition of marriage should be changed to allow same-sex couples to marry, the government did as we flagged we would do, and we went with the next best way. The next best way is a marriage law survey conducted by the Australian Bureau of Statistics. The details of that have been well and truly released by now.
The senator is quite correct that the deadline for enrolments—the deadline for all eligible Australians to ensure their details are up to date or that they have newly and freshly enrolled—is 6 pm on 24 August. I would encourage all Australians who are eligible to participate to ensure that they are validly enrolled and to ensure their details are up to date by 6 pm on 24 August because, of course, we want every eligible Australian to have the opportunity to have their say. At the end of this process, this will help facilitate the Australian community moving on from an issue that has been around for a long time.
The PRESIDENT: Senator Rice, a supplementary question?
Senator RICE (Victoria) (14:23): I will point out that that is in stark contrast to the AEC, where 16-year-olds and 17-year-olds can preregister. Does the ABS intend to include a personal identifier on people's marriage equality postal ballots? Will the ballots include a number to identify their name and address? If so, how can people trust that an individuals' views will not be matched to their census data, which would spoil the secret vote? If not, how is the government going to assure people that the poll will not be vulnerable to fraud? (Time expired)
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (14:24): All of the appropriate integrity arrangements are in place, and the Australian Statistician has assured me there will not be any capacity for people to identify the way that any Australian has chosen to fill in their survey form under the process that the Australian Bureau of Statistics is conducting.
The PRESIDENT: Senator Rice, a final supplementary question?
Senator RICE (Victoria) (14:24): Given the extreme difficulties in carrying out a postal plebiscite that doesn't disenfranchise young people, that doesn't result in a harmful and hurtful campaign to LGBTIQ people and our families, that is either fatally subject to fraud or fatally undermining of our privacy and that, at the end of the day, isn't binding, why won't the government ditch this postal plebiscite and move to bring on a vote in this parliament this week so that parliament can do its job and vote for love and for equality?
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (14:24): Firstly, I do not agree with the characterisation of the Australian marriage law survey conducted by the ABS that Senator Rice has put forward. Secondly, it was the government's preference to give every eligible Australian a say through a compulsory personal attendance plebiscite, but the Senate did not agree with that course of action, so we have chosen an alternative course. The reason we've chosen that course is that we believe that there are good people in the community across Australia who have a diversity of sincerely and strongly held views on both sides of the argument. We believe that the best way and the fairest way for this issue to be settled on a more permanent basis, and to facilitate a consensus across the community, is to give every Australian the opportunity to have a say and that is precisely what we're doing.
Deputy Prime Minister
Senator McALLISTER (New South Wales—Deputy Opposition Whip in the Senate) (14:25): My question is to the minister representing the Prime Minister, Senator Brandis. I refer to the Deputy Prime Minister's statement to the House of Representatives regarding the referral of his eligibility for election under section 44 of the Constitution to the High Court. When and how did the government first become aware that the Deputy Prime Minister may be ineligible for election under section 44 of the Constitution?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:26): Senator McAllister, for the reasons I explained in answer to your colleague Senator Cameron's question, I'm not going to go into any factual matters in relation to the case, other than to say that on the basis of Solicitor-General advice, the government is confident of the Deputy Prime Minister's position. That being said, I first became aware of the matter late on Thursday afternoon, and I think that was shortly after the government became aware.
The PRESIDENT: Senator McAllister, a supplementary question.
Senator McALLISTER (New South Wales—Deputy Opposition Whip in the Senate) (14:27): When did the Prime Minister first become aware of concerns about the Deputy Prime Minister's eligibility for election?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:27): My understanding is, shortly before I did.
The PRESIDENT: Senator McAllister, a final supplementary question.
Senator McALLISTER (New South Wales—Deputy Opposition Whip in the Senate) (14:27): When was advice first sought in relation to the Deputy Prime Minister's potential ineligibility for election under section 44 of the Constitution? Who sought this advice and from whom was it sought?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:27): Advice was first sought on Friday—the next day—and the advice was sought by me.
Marriage
Senator HANSON (Queensland) (14:27): My question is to the Attorney-General, Senator Brandis. Marriage is not defined in the Australian Constitution, as it is in the Irish constitution. A constitutional definition of marriage would ensure any further changes would be decided by the majority of Australians in another referendum. In addition, a referendum on marriage equality would have saved taxpayers millions of dollars if it had been held at the same time as the next federal election. Keysar Trad, the former President of the Australian Federation of Islamic Councils, has been reported as saying, 'Same-sex marriage is wrong.' Instead he wants polygamous marriage recognised, to give Islamic multiple marriages equality. My question is, Minister, will the government support a referendum to give Australians the right to decide how marriage is defined in the Australian Constitution, whether it is between a man and a woman, or a man and a woman and people of the same sex?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:29): Thank you very much indeed, Senator Hanson. There isn't a definition of marriage in the Australian Constitution, you're right. But the Australian Constitution does, by subparagraph 21 of section 51, allow the parliament to make laws in relation to marriage. The High Court decided in 2013 that the marriage power in the Constitution included the capacity to make laws for same-sex marriage. That was decided in a case between the Commonwealth and the ACT at the time. So there's no doubt about that, but the question really is, 'How should the parliament inform itself of the wishes of the Australian people?'
As you know, the government took to the last election a promise to have this matter dealt with by a plebiscite, because we consider that this is such a unique question—a question about which politicians have no greater insights or wisdom than every other citizen—and therefore every Australian should have their say. I regret to say that the proposal to have a compulsory attendance plebiscite has been blocked by this Senate not once but now twice. So the government is doing the next best thing to fulfil its commitment to the Australian people from the 2016 election and to involve as many Australians as possible in this decision, and that is the postal plebiscite that is being conducted by the Australian Bureau of Statistics.
I encourage every Australian to take advantage of the opportunity given to them to have their say. Whether you are in favour of same-sex marriage or whether you think the definition of marriage should remain the same, every Australian should take the opportunity to have their say.
The PRESIDENT: Senator Hanson, a supplementary question.
Senator HANSON (Queensland) (14:31): In the absence of a referendum to give a constitutional definition of marriage, what guarantee is there that the definition will not change again to suit other minority groups?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:31): For the reason I explained to you, it is entirely unnecessary to have a referendum, because the Constitution already has a marriage power. The High Court, as recently as 2013 in an unambiguous and unanimous decision, made it clear that with the marriage power it gives the parliament the capacity to make laws for marriage between people of the same sex. In the event that there is a yes vote in the plebiscite, that is what the government will facilitate the parliament doing by debating a private members bill.
Senator Hanson, we do not think that it is appropriate or desirable to have an unnecessary constitutional referendum. What we do think is appropriate and desirable is to give the people a say, and the plebiscite question will be in precisely the same terms as the plebiscite question that was frustrated by the Senate in the bill, namely: do you believe that the Marriage Act should be changed to allow people of the same sex to marry? (Time expired)
The PRESIDENT: Senator Hanson, a final supplementary question.
Senator HANSON (Queensland) (14:32): I ask the question: what guarantee do you give the Australian people that future governments will not change the Marriage Act to include polygamous marriages or marriages under the age of 16, regardless of what the Australian people want and in consideration with what Keysar Trad, the former head of the Islamic council of Australia, has said: that they agree with polygamous marriages?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:33): Senator Hanson, let me correct the answer I gave you in relation to that last supplementary question. The question will be to allow same-sex couples to marry. The question is specifically in relation to couples: two people, not more. Two people. I can give you my absolute assurance that in the event that the plebiscite question was to be resolved yes, the bill that will come to the parliament will deal with couples. It will deal with marriage between two people.
Energy
Senator WILLIAMS (New South Wales—Nationals Whip in the Senate) (14:33): My question is to the Minister for Regional Development, Senator Nash. Can the minister outline how the coalition government is working to improve energy security, reliability and affordability for regional Australian households and businesses?
Senator NASH (New South Wales—Deputy Leader of The Nationals, Minister for Regional Development, Minister for Local Government and Territories and Minister for Regional Communications) (14:34): I thank Senator Williams for this very important question. Energy affordability, of course, is a huge issue for households, businesses and farmers across regional New South Wales and, indeed, right across regional Australia. That's precisely why we are taking action on a number of fronts to help address this issue.
While those opposite are intent on pursuing ideological energy policies, the coalition is delivering meaningful and practical measures guided by expert engineers and economists. We commissioned the Finkel review and, at the recent COAG Energy Council, 49 out of 50 recommendations from the Finkel review were agreed to, including three-year notice of closure, generator reliability and security obligations. We are also taking strong action on gas supply, which will ensure the gas supply needs of Australian households and consumers are met before those of international customers.
What I am most proud of is the massive investment the Turnbull-Joyce government will be making to build Snowy Hydro 2.0, which will increase energy security and affordability for regional households and businesses and bring much-needed jobs to the Snowy Mountains region. Snowy Hydro 2.0 will help make renewables reliable, filling in holes caused by intermittent supply and generator outages. It will enable greater energy efficiency and help stabilise electricity supply into the future. This project could boost electricity production capacity by 2,000 megawatts—enough to power an additional 500,000 homes. It's estimated this truly nation-building project will create thousands of engineering and construction jobs—at least 5,000. Those are jobs that will be of great benefit to the great people of Cooma, Jindabyne, and the entire Snowy region and beyond.
The PRESIDENT: Senator Williams, a supplementary question.
Senator WILLIAMS (New South Wales—Nationals Whip in the Senate) (14:35): I thank the minister for her answer. Minister, what additional measures is the government implementing to ensure that regional Australian households and businesses have access to affordable and reliable energy?
Senator NASH (New South Wales—Deputy Leader of The Nationals, Minister for Regional Development, Minister for Local Government and Territories and Minister for Regional Communications) (14:36): I am pleased to report that last week the Prime Minister secured agreement from retailers on immediate measures and ongoing changes to put regional families and small businesses first. The commitments include contacting all customers who are on expired discounts and telling them how much they can save on a better deal; requiring companies to report to the government and the ACCC on what they are doing to get families onto a better deal and how many families remain on expired deals; developing simple, plain-English fact sheets with understandable comparison rates; changing electricity rules requiring companies to inform customers when their discount benefits end, setting out the dollar impact of doing nothing; and ensuring families and individuals on hardship programs will not lose any benefit or a discount for a late payment. These are immediate actions being taken by this government, ones we have secured to help ensure families are not paying more for their power than they should.
The PRESIDENT: Senator Williams, a final supplementary question.
Senator WILLIAMS (New South Wales—Nationals Whip in the Senate) (14:37): Can the minister advise the Senate of whether she is aware of any alternative approaches to energy policy and how these policies would impact on regional Australia?
Senator NASH (New South Wales—Deputy Leader of The Nationals, Minister for Regional Development, Minister for Local Government and Territories and Minister for Regional Communications) (14:37): We know that the Labor Party plans to force the closure of coal-fired power stations at a time when we can least afford it. I also remind the Senate of the last time Labor brought in a carbon tax. That tax represented a $15 billion cost to Australia's economy, and we in the coalition believe there is a better and more pragmatic approach. Labor's carbon tax made farmers less competitive internationally, it made our regional industries less competitive internationally, and it risked the livelihood of hundreds of thousands of regional Australian working families who rely on affordable energy to power their industries and to provide their jobs. Regional households, businesses and farms are under unprecedented cost pressures and now is not the time to be either conducting big experiments like the Labor Party's Jay Weatherill is doing in South Australia or bringing back crude taxes that will hurt regional people without helping the environment.
Deputy Prime Minister
Senator WONG (South Australia—Leader of the Opposition in the Senate) (14:38): My question is to the Attorney-General and the Minister representing the Prime Minister, Senator Brandis. It follows on from his response to Senator Cameron. I ask the minister: can the minister explain why Minister Canavan was required to step aside but the Deputy Prime Minister is not?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:38): Senator Wong, that is really the same question that Senator Cameron asked me and the answer is the same.
The PRESIDENT: Senator Wong, a supplementary question.
Senator WONG (South Australia—Leader of the Opposition in the Senate) (14:38): In the previous answer, the minister said there were 'factual and legal differences' between Senator Canavan and Mr Joyce. Can the minister advise the Senate which of these 'factual and legal differences' requires one minister to stand aside but permits another to continue?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:39): With respect, Senator Wong, it's not which factual and legal differences that is the point. The point is that there are factual and legal differences, which means that each case will have to be judged on its own facts and according to, respectively, the law of Italy and the law of New Zealand.
At risk of repeating myself, as I said in answer to Senator Cameron, on 25 July, when Senator Canavan was acquainted with the situation and on the basis of his understanding of the facts, at that time he decided that he would prefer to stand down. The facts of Mr Joyce's case, as I said before, are much clearer to us than were the facts as known to Senator Canavan at the time he made his decision. On the basis of those known facts and clear Solicitor-General advice, the government does not consider that there is sufficient reason for Mr Joyce to step down.
The PRESIDENT: Senator Wong, a final supplementary question.
Senator WONG (South Australia—Leader of the Opposition in the Senate) (14:40): Given that the New Zealand Prime Minister and the New Zealand Minister of Internal Affairs have both confirmed that Australia's Deputy Prime Minister is a New Zealand citizen, will Prime Minister Turnbull now revisit his refusal to have Mr Joyce stand aside?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:40): Well, he won't, because that fact alone is not dispositive of the question.
Solomon Islands
Senator FAWCETT (South Australia—Deputy Government Whip in the Senate) (14:40): My question is to the Minister for International Development and the Pacific, Senator Fierravanti-Wells. Minister, could you update the Senate on the concluding phase of the Regional Assistance Mission to the Solomon Islands and outline what RAMSI has achieved?
Senator FIERRAVANTI-WELLS (New South Wales—Minister for International Development and the Pacific) (14:41): I thank you, Senator Fawcett, for your question. Firstly, I would like to acknowledge and welcome our friend the Prime Minister of the Solomon Islands, Manasseh Sogavare, as a guest of government to Australia. Ours is a friendship that spans many decades. It's across aid, it's across trade, it's across security, and it's across the many lives that have been lost.
Just last week, I was in the Solomon Islands for the 75th anniversary commemoration of the Battle of Guadalcanal and the sinking of HMAS Canberra. I was privileged to be at the end of RAMSI celebrations, and they were led by the Governor-General, Sir Peter Cosgrove. This marked the end of a 14-year deployment and the success and the legacy that RAMSI has left not just for the Solomon Islands but also for the region. At its height, there were almost 2,000 military, 375 police and 185 advisers. It was a civilian-led operation, Operation Helpem Fren. It cost $3 billion, of which $2.8 billion was contributed by Australia.
Let me take senators back to April of 2003. The then Solomon Islands Prime Minister, Sir Allan Kemakeza, wrote to the then Australian Prime Minister, John Howard, requesting our assistance. Our assistance was very, very swift. The mechanism for providing assistance was the Regional Assistance Mission to the Solomon Islands, known as RAMSI. Why it was such a success was that it was truly a regional response. All 15 members of the Pacific Islands Forum contributed. Yes, we contributed the bulk, but we did contribute as equal partners. It is a legacy of regional cooperation, and we are looking forward to discussing the post-RAMSI framework for continued regional security. (Time expired)
The PRESIDENT: Senator Fawcett, a supplementary question.
Senator FAWCETT (South Australia—Deputy Government Whip in the Senate) (14:43): Could the minister inform the Senate of what that post-RAMSI framework is so that we can reinforce the gains made by RAMSI and ensure an enduring peace?
Senator FIERRAVANTI-WELLS (New South Wales—Minister for International Development and the Pacific) (14:43): Thank you, Senator Fawcett. It is in the national interests of both Australia and the Solomon Islands to continue to work together to ensure that the gains made under RAMSI are preserved. We have provided a post-RAMSI package of $141 million, consisting, basically, of three components: stability, economic growth, and human development. We will be having a justice program and a governance program and will continue to assist the Solomon Islands police.
Today, the Solomon Islands and Australia have signed a bilateral treaty which will allow Australia and the Solomon Islands to cooperate on security and defence matters. More importantly, may the events of RAMSI never happen again. But our security treaty is not just about security; it's also about going in to help our neighbours, particularly in times of humanitarian disasters.
The PRESIDENT: Senator Fawcett, a final supplementary question.
Senator FAWCETT (South Australia—Deputy Government Whip in the Senate) (14:44): Could the minister update the Senate on how the work undertaken by RAMSI has directly benefited Australia?
Senator FIERRAVANTI-WELLS (New South Wales—Minister for International Development and the Pacific) (14:44): Australia benefits greatly from peace and stability in our region. Solomon Islands is a very, very close neighbour and, as a neighbour and a friend, we have a significant national interest in that state, as we have in the ongoing security of the Pacific and of our Pacific Island neighbours. Can I remind the Senate that our defence white paper said that, after the defence of Australia, the stability and security of our region is paramount.
We do not want to see a repeat of what happened in RAMSI. We do not want to see a repeat of the circumstances that led to an intervention like RAMSI. Without RAMSI's work it is possible and highly probable that the Solomon Islands could have disintegrated into a failed state, therefore becoming a safe haven for all sorts of transnational crimes, including narcotics, money laundering and arms. In conclusion, could I pay tribute to those Australians who served in RAMSI. (Time expired)
Australia-United States Relationship
Senator DI NATALE (Victoria—Leader of the Australian Greens) (14:45): My question is for the minister representing the Minister for Foreign Affairs, Senator Brandis. We are currently on the precipice of a major nuclear conflict involving two dangerous and paranoid leaders, which has led some commentators to describe this as a more dangerous situation than the Cuban Missile Crisis of October 1962. Yet the Prime Minister has said that Australia is joined at the hip to one of these madmen. Minister, isn't it time for Australia to surgically remove this growth on our hip so that Australia doesn't blindly follow the US into yet another senseless conflict but instead plays a more constructive role in helping to resolve conflict and to bring peace to the world?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:46): Senator Di Natale, to start with, I utterly reject your insulting description of the President of the United States of America. The United States of America is Australia's greatest ally. It has been our greatest ally since the time of the Second World War, and long may it remain so.
Nevertheless, Senator Di Natale, your question does give me the opportunity to address the situation in North Korea. North Korea's pursuit of nuclear and ballistic missile capabilities is unacceptable. It flouts unanimous UN security resolutions. Every act of defiance adds to the hardship of that country's long-suffering people. Australia is deeply concerned about the global threat posed by North Korea's nuclear and ballistic missile program and its illicit activities, including sales of weapons of mass destruction, related material and arms, cyber attacks and alleged assassinations. Australia implements a sanctions regime aimed at limiting North Korea's ability to develop weapons of mass destruction.
On 6 August, the Minister for Foreign Affairs agreed to designate an additional three individuals and seven entities for targeted financial sanctions under Australia's autonomous sanctions regime. Our measures add to the international pressure and complement the strong resolutions adopted by the United Nations Security Council, including by resolution 2371, adopted on 5 August, which takes strong steps to curtail revenue going to North Korea by banning certain exports. Australia is delivering very clear messages to North Korea that its interests are best served by ceasing its nuclear capability. (Time expired)
The PRESIDENT: Senator Di Natale, a supplementary question.
Senator DI NATALE (Victoria—Leader of the Australian Greens) (14:48): Minister, why did the Prime Minister pre-emptively declare unwavering support for the Trump administration and blindly commit our troops to a possible nuclear war on the Korean peninsula when the ANZUS treaty requires nothing of the sort? It requires us only to consult.
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:49): Senator Di Natale, this government is committed to the ANZUS treaty. It is committed to support for our greatest ally. It is committed to peaceful resolution of international disputes. The problem lies at the feet of North Korea and the nuclear and ballistic missile program that it has developed in flagrant violation of unanimous UN security resolutions and of international opinion. It is that country that is the belligerent state. We continue to work with the United States as well as with the Republic of Korea, Japan, China and other friends and partners to ensure the strongest possible response to North Korea's defiance of international norms. We will work with our ally the United States, in particular, in developing that response.
The PRESIDENT: Senator Di Natale, a final supplementary question?
Senator DI NATALE (Victoria—Leader of the Australian Greens) (14:50): In the spirit of that answer, would the Minister concede that language like North Korea would 'face fire and fury like the world has never seen' does not bring us closer to peace? Is that de-escalating language? Is that language that allows us to seek a peaceful resolution to this conflict?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:50): Senator Di Natale, I'm not going to run a commentary on language adopted by the President of the United States of America. What I can tell you, Senator Di Natale, as I can tell all senators, is that Australia is working with our allies and in particular working with the United States' administration in order to de-escalate this situation.
The PRESIDENT: A point of order, Senator Di Natale?
Senator Di Natale: On relevance, I don't expect the minister to run a commentary, but I asked a very straightforward question. It was in the context of the answer he gave to my first supplementary question. When the Minister talked about being reckless and spoke about de-escalation, I put a very direct quote to him. It was a quote from the President of the US who said that North Korea would face 'fire and fury like the world has never seen.' I asked him specifically whether he felt that language was consistent with de-escalation or whether it was reckless and I would like to minister to answer.
The PRESIDENT: That's correct. You did ask those elements in your question, and the Attorney-General responded by saying he was not going to comment on that. I will draw that back to the Attorney-General's attention.
Senator BRANDIS: Senator Di Natale, we would be very foolish to glean foreign policy from American presidential rhetoric. I remember a previous American President once declared that he would pay any price, bear any burden, support any friend and oppose any foe. President Trump is not the first American president who has engaged in rhetorical exuberance.
Energy
Senator KIM CARR (Victoria) (14:52): My question is to the minister representing the Prime Minister, Senator Brandis. It is now over two months since Dr Finkel handed down his report which stated:
There is an urgent need for a clear and early decision—
—on a clean energy target. After two months, Minister Frydenberg said there is:
… no need to rush this decision …
Can the minister explain to Australian energy consumers struggling with the high cost of energy why there is no rush to resolve the government's policy paralysis?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:53): Senator Carr, as I think your question implicitly acknowledges, this is a very important decision. It's a very important decision and it will be approached by the Australian government in an appropriately careful way, which is what we are doing now. You and your colleagues have asked about this matter during the course of the past week, and the answer hasn't changed. The Australian government is considering the recommendation of the Finkel report in relation to a clean-energy target. We are considering that recommendation very carefully and very thoroughly. We are adopting an appropriate process for the consideration of that recommendation and we will be making a decision in the near future. Senator Carr, that is the way grown-up governments behave. The way grown-up governments behave is to consider carefully the policy implications of important recommendations and to make their decisions accordingly.
But, as I pointed out to you and your colleagues last week, Senator Carr, the one thing this government will not be doing, which is what bedevilled energy policy during the period when you were in government, is being enslaved by ideology. We will not, as the Labor party was and as state Labor governments—notably in South Australia and Victoria—are at the moment, be enslaved by ideology. We will be making a practical decision, based on engineering, based on science and based on economics, in order to ensure that whatever energy mix we have will be platform or source agnostic and be most serviceable to the twin objectives of affordability and reliability—two objectives that your government signally failed to achieve.
The PRESIDENT: Senator Carr, a supplementary question.
Senator KIM CARR (Victoria) (14:55): Aluminium producer Tomago, in New South Wales, is planning to cut production and jobs because of the massive recent increases in the cost of electricity. Can the minister explain to Australian manufacturers struggling with the cost of energy why there is no rush to resolve this government's policy paralysis?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:55): Senator Carr, what any corporation would expect of a government is that it approaches the making of important decisions in a careful, thorough and methodical way, which is precisely what we propose to do. Senator Carr, we are not, unlike the Australian Labor Party, going to find ourselves in a situation in which we can't keep the lights on, the way the Weatherill Labor government in South Australia is unable to keep the lights on. We are not going to preside over a situation like the Queensland Labor government, of unlamented Annastacia Palaszczuk, which sees electricity prices escalating exponentially across Queensland, particularly across regional Queensland, because the state government takes dividends out of state owned assets. And we are certainly not going to preside over a situation, as you did when you were in power, which saw electricity prices rise by 101 per cent over the six years of the last federal Labor government.
The PRESIDENT: Senator Carr, a final supplementary question.
Senator KIM CARR (Victoria) (14:56): Given that the government party room has met for five hours to resolve this question and still can't come to a decision, isn't it clear that the reason the Turnbull government is in no rush to resolve its policy paralysis is because its too divided to make a decision?
Senator BRANDIS (Queensland—Attorney-General, Vice-President of the Executive Council and Leader of the Government in the Senate) (14:56): Senator Carr, I seem to recall the former Labor government being very swift in some of the decisions it made. I seem to recall the former Labor government cancelled live cattle exports to Indonesia overnight, on a whim, because you overreacted to a Four Corners program. That's the sort of policymaking for which the previous Labor government was famous, or should I say, infamous. How many Australians suffered? How many Indonesians suffered? How much damage was done to the relationship between our two nations as a result of that ignorant, impulsive, reactive and poorly thought-through decision? When it comes to the question of the Finkel report and a clean energy target, we are going to be methodical, we are going to be careful and we are going to make a decision based on science, based on engineering and based on empirical considerations through a proper process, and it will be announced in the near future.
North Korea
Senator McKENZIE (Victoria) (14:57): My question is to the Minister for Defence, Senator Payne. Can the minister advise the Senate how Australia is working with like-minded nations to de-escalate tensions on the Korean Peninsula?
Senator PAYNE (New South Wales—Minister for Defence) (14:58): I thank Senator McKenzie for her question. It's true to say that Australia and our neighbours have benefited enormously from the ongoing peace and stability of the Indo-Pacific region, which has enabled trade and prosperity to flourish across the region over the past 75 years. However, that stability is gravely threatened by the reckless actions of the North Korean regime, as I said last week, which continues to disregard multiple United Nations Security Council resolutions aimed at always maintaining global peace. By the development and illegal testing of its weapon and missile programs, North Korea has deliberately decided to become a destabilising and disruptive influence in the region.
The outbreak of conflict, of war, on the Korean peninsula would have catastrophic consequences, including for North Korea. That's why it's important that we continue to pursue collective action to prevent North Korea from continuing on its dangerous path. The best prospect for a peaceful and enduring solution of this problem is for North Korea to comply with UN resolutions and dismantle its nuclear and ballistic missile program.
Australia is committed to maintaining regional stability. We're working within the United Nations framework of sanctions, advocacy and collective action to encourage the North Korean regime to comply with the rules based global order and coexist with other nations. We are working with our allies and partners to determine the most appropriate defensive countermeasures, including using diplomatic means to constrain and deter North Korea's illegal weapons development activities. Australia will continue to implement sanctions, including autonomous sanctions, aimed at restricting North Korea's ability to carry out its threats. Whatever North Korea's objectives, threats of missile strikes against other nations are unacceptable, and Australia condemns this behaviour without reservation. (Time expired)
The PRESIDENT: Senator McKenzie, a supplementary question.
Senator McKENZIE (Victoria) (15:00): Can the minister advise the Senate how Australia's alliance with the United States improves regional stability?
Senator PAYNE (New South Wales—Minister for Defence) (15:00): A foundation of regional stability is dependable and reliable security frameworks. It's the Association of Southeast Asian Nations, the Five Power Defence Arrangements and the ANZUS treaty. The US has been a stabilising influence in the Pacific since 1945. The US-Australia alliance is our most important strategic defence relationship. It's central to our security and strategic arrangements. It's an alliance that is underpinned by the deepest levels of cooperation between our two nations, and it's been strengthened by consecutive governments over the past 75 years. It has historically recognised that an armed attack on Australia or the United States would be dangerous to both countries, and it obliges each country to consult if the security of the parties is threatened and to act to meet common danger in the event of an armed attack in the Pacific. We are committed to strengthening regional security frameworks to ensure that stability and prosperity is maintained. (Time expired)
The PRESIDENT: Senator McKenzie, a final supplementary question.
Senator McKENZIE (Victoria) (15:01): Can the minister outline how Australia is contributing to regional stability?
Senator PAYNE (New South Wales—Minister for Defence) (15:01): Australia is committed to those economic and diplomatic sanctions and regional security matters wherever possible, as I have previously identified. As I have said, Australia is committed to strengthening those regional frameworks so that we and our regional partners can work cooperatively to resolve shared challenges and to address common threats. We also outlined in the 2016Defence white paper increasing our international defence engagement to enhance practical cooperation and strengthen our strategic partnerships. By working closely with our partners and allies, we mitigate the risks produced by an increasingly complex strategic environment.
North Korea represents one of those grave challenges. Australia is committed to implementing the United Nations resolutions against North Korea, which were unanimously adopted, demonstrating unqualified international unity and resolve. It's only through unified and collective action that Australia and our regional partners and allies can address the shared challenges that undermine peace and stability in our region now and in the future. (Time expired)
Senator Brandis: I ask that further questions be placed on the Notice Paper.
ANSWERS TO QUESTIONS ON NOTICE
Question No. 477
Senator LINES (Western Australia—Deputy President and Chair of Committees) (15:02): Under standing order 74(5)(a), I seek an explanation from the Minister for Indigenous Affairs, Senator Scullion, as to why question No. 477, which I placed on notice on 13 June 2017, remains unanswered. I note that the minister sent a reply to my question to my office at 1.41 this afternoon, but I am advised it is yet to be tabled with the Table Office.
Senator SCULLION (Northern Territory—Minister for Indigenous Affairs and Leader of The Nationals in the Senate) (15:03): As the senator indicated, the answer is with the senator's office but not yet tabled. It's awaiting the normal tabling process, and I apologise in advance for the delay in providing the information.
Senator LINES (Western Australia—Deputy President and Chair of Committees) (15:03): Under standing order 74(5)(b), I move:
That the Senate take note of the explanation.
The catchcry of this government has been, 'We want to be doing things with, not to, Aboriginal and Torres Strait Islander communities,' yet the introduction of the CDP, in regard to consultation, would be rated as a failure. Despite the government's stated intention of wanting to engage Aboriginal and Torres Strait Islander individuals, families and communities, no such consultation has indeed occurred. The CDP, as we have heard through our own visits to communities, through our own investigations and, indeed, through Senate estimates, has absolutely impacted, in an extremely negative way, on the lives of individuals, families and communities.
From the range of questions Labor senators put during the estimates process and, indeed, these unanswered questions on notice to the minister, we can see that the CDP is not transparent. We have spoken to organisations on the ground and to affected Aboriginal and Torres Strait Islander people, and they don't understand the process which has been imposed upon them. But that's about all we do know for certain. There is little evidence, if any, that the CDP has been successful in getting people into sustainable jobs, which surely must be the intent of this program or, indeed, any program. Its forerunner, the Remote Jobs and Community Program, known as the RJCP, was just in its infancy when the government declared it to be a 'disaster'. There was no long-term investigation into how it was operating; it was just stopped and cut. Then, seemingly without consultation, the CDP was rolled out.
One of the claims the government makes is that there are Aboriginal and Torres Strait Islander organisations running the CDP program—and there are. But many of those organisations were simply transferred over from the abandoned RJCP scheme. They don't have any power to change or apply local circumstances to the CDP. They are merely a conduit for the government's harsh CDP agenda. As one of the submitters to the current CDP inquiry suggests:
It is therefore a government choice as to whether the largely government provided economy is a welfare or an employment based economy.
When we look at remote communities, we can see that they rely on governments for infrastructure delivery, for houses, for medical centres and, indeed, for service provision. The government is a large potential employer in communities. But it is their choice whether they provide an economy to remote communities or create further welfare dependency. It comes as no surprise to me that that submitter was none other than the Liberal former Aboriginal and Torres Strait Islander minister, Mr Fred Chaney, who has been the lone Liberal voice on injustice after injustice to Aboriginal and Torres Strait Islander peoples, and in particular to those in remote communities.
I've only had a short amount of time to have a look at the answers provided to me today, but certainly one of the concerns that all Labor senators expressed after the last Senate estimates was the number of compliance investigations. In just eight months there were nearly half a million. When we raised those questions at Senate estimates, the minister, Senator Scullion, offered us a briefing. Certainly he said that to me privately. Well, we called his office to organise that briefing—and guess what? We're still waiting. It never came. We waited several weeks for this offered briefing to materialise. I can certainly, outside of the chamber, provide the name of the individual that we spoke to in his office about the briefing, if the minister is interested. I certainly don't think it's appropriate to put it on the record publicly in this place. We were still waiting, so we submitted our questions on notice, and we waited and we waited, and we waited. And I think to have to wait a full month after the due date is tardy to say the least.
And so at 10 past 12 today, we informed the minister's office that we would be using the standing order after question time, and we were told that the minister had signed off on the questions, but they were 'floating around' in the department somewhere. Again, that is extremely tardy. This issue of CDP is a very, very important issue. I was up at the Ng Lands last year, in a very remote community—I'm sure the minister knows it well—and I know that Senator Dodson, too, visited that community to see firsthand the devastation that CDP is creating in those very small communities. English is not widely spoken there. Most people speak language across those communities. Indeed, wherever we went we were expected to have an interpreter, because, as I say, not only is English not widely spoken, it's not widely known. And I saw in that community breach letter after breach letter after breach letter.
There's a story out of Warburton on that. One of the questions we asked the minister today is: what sorts of records are kept? We were informed that participants are not given breach letters—aren't advised when their payments are breached. Well, that completely flies in the face of a four-page, extremely technical letter that was sent to a young woman in the Warburton community. As to her circumstances: again, if organisations on the ground had one iota of flexibility, she would never have been breached. She had served some time in a detention facility and had been released on orders, and those orders prohibited her from attending the Warburton community. As we also know from comments that Senator Malarndirri McCarthy made in this place last week, people in these communities don't have addresses. They don't live at '10 Smith Street, Warburton'. All of the mail is collected centrally. So she got a letter from the department that was just addressed to 'Miss So-and-so, Warburton'. She wasn't there, because she had an order against her which said that she wasn't allowed to go back, for the time the order prevailed, to the Warburton community. So she was in an adjoining community. The community knew that, and no doubt the CDP provider knew that, but somehow that message didn't make its way through to Centrelink.
Another interesting thing that happened was this. Again, local knowledge is really what we want to be applied in these situations. Anyone who visits the Ng Lands knows that they operate, for the most part, on central desert time. But Warburton doesn't; Warburton operates on Western Australian time. So when the required phone call was organised, the officer from the department residing in Queensland just assumed that Warburton was on central desert time, which it isn't. So she never got the phone call. But that was a strike against her. There was simply no investigation made; she was just told: 'You didn't show up for your appointment.' Even though the officer had arranged that appointment on central desert time, and Warburton is on Western Australian time, that was a black mark against her name. Again, if we'd been able to have that input of local knowledge, that would not have occurred, because someone could've told the Queensland officer: 'Hang on a minute—unlike the rest of the communities in the Ng Lands, Warburton is on Western Australian time.'
As I said, what's well known about that community—potentially not well known by an officer in Queensland, but certainly by those of us in this place who have visited—is that English, for most of the people in that community, is not spoken, and indeed is not well known. Her letter is four pages—four pages of technical jargon that she wouldn't have been able to understand in any event. But that flies in the face of the information that I've waited a whole month for, which tells me that those letters are not even sent. So not only do communities not understand the CDP and its implications; apparently, the government does not either. They told me in questions delivered to my office today at 1:41 that somehow no breach letters are given out, and yet I have a breach letter addressed to a young woman in Warburton. What's going on there?
So the CDP is a mess. We are having an inquiry into the CDP because, clearly, people are doing it really tough. The other evidence I heard in Warburton, and indeed saw with my own eyes, is that children are going hungry when a person is breached. Children are going hungry because there's no money in the community. They are relying on the person in the home who maybe has an age pension to provide for the whole community.
Indeed, this is not just about the Ng Lands. Last week, Twiggy Forrest came here and said the answer to the problem is to roll out the BasicsCard. We on this side know that there is no single answer to the generations of dispossession that have been foisted upon our Aboriginal and Torres Strait Islander communities. And, from speaking to agencies firsthand in Kununurra, I can tell you that there is a problem with the BasicsCard. It is being cashed out by the local taxi drivers. Taxis are allowed to be used on the BasicsCard, so the drivers are exploiting the community. They give out cash but keep most of the money for themselves. And I'm told it's children that are doing this. I'm also told that burglaries have gone up in Kununurra. Why? Well, we know what young kids do when they're hungry: they break in. The BasicsCard is not creating all of the problems, it's CDP as well. So Mr Forrest needs to look a little further than his one-size-fits-all. He needs to speak to people in Kununurra and see what's happening. If it's widely known that that's what taxi drivers are doing there, and seemingly it is, then how come Mr Forrest missed that basic truth?
I'm told that the CDP and the BasicsCard are strongly contributing to what's happening in Kununurra. So I'm disappointed that the minister chose to ignore our questions for a whole month. And there are processes in this place to get information. I didn't necessarily want to go down the questions on notice route. By contrast, when I asked the Attorney-General for a briefing on the McGlade matter, I very quickly got a very thorough briefing by one of his staff. I was able to ask lots of questions. It was a very thorough briefing. I asked for it and I received it. Unfortunately, when the minister offered the briefing, we waited and waited and nothing happened. I put on notice questions about my very serious concerns about the CDP program. Those questions had remained unanswered until, at 10 past 12 today, I did the minister the courtesy of letting him know we would be doing that—and suddenly the answers are forthcoming. I haven't had a proper opportunity to give close scrutiny to those answers, but my first reading of them is that they fly in the face of other information we got from Senate estimates. I will leave my remarks there.
Senator SCULLION (Northern Territory—Minister for Indigenous Affairs and Leader of The Nationals in the Senate) (15:18): I thank the senator but I would like to correct some significant inaccuracies in her contribution. First of all, I did apologise for both the briefing and the lateness of this. I know that at least one member opposite, Senator Dodson—and I hope he'll have something to say about this—was in fact at Garma when I made an announcement of significant changes to this. Because we were making sure that the announcement was going to be able to be made absolutely accurately with the significant change in the policy, we wanted to delay briefing anyone until that happened—and that is just the way it went.
In terms of some other inaccuracies in your presentation of how this has all gone, in my view that is somewhat in fantasy land. You say the RJCP was in its infancy, that it had hardly had a go. Well, it had had a decline of 60 per cent in the number of people who were even attending. I'm not sure what those opposite would want it to decrease by. Maybe we have to get down to 100 per cent of people returning to passive welfare, complete misery and danger to themselves that goes with that, so we did intervene.
You said, 'Seemingly, without consultation.' Now, if anyone was listening to that, they might think that actually meant without consultation, but, of course, it doesn't. It's one of those slim little words you put in there when you wish to confuse people. There was consultation, and I can tell you people said, 'We want to go back to CDEP.' We decided to, as much as we could at the time, move in that direction, and there has been remarkable success: 92 per cent of eligible jobseekers are now placed in work-life activities; and active participation, instead of seven per cent, has actually increased by 62 per cent. These are actual facts, and should be regarded as such by all those listening.
We put strong protections in place to make sure the penalties are only applied where they're warranted. These protections are the same for all jobseekers across Australia. These protections ensure that jobseekers don't suffer financial hardship. It's okay to say, 'Well, there were miles and miles of people who were breached,' but then you don't go on and say what I'm assuming you know, because you are a part of that process under which submissions were made by government to indicate that 90 per cent of those breaches were waived. It's interesting that, when making a contribution in this place to inform people, you would leave such important facts aside.
You've also talked to a couple of facts I can't let go. You paint a picture of a child having someone else's BasicsCard, getting into a taxi, apparently with not much language but managing to be able to calculate quite comprehensive fraud. I've heard some of these rumours, particularly about the taxi industry—that's probably the only one. In South Australia, there was a significant fraud. I congratulate Kyam Maher and the Premier in South Australia for prosecuting those individuals who owned stores there in that regard.
The other notion is that somehow somebody on aged care is somehow subject to CDEP. Perhaps I should send you another brief, Deputy President, Senator Lines; they're not even a part of this program; they're part of a completely separate program and are not subject to any CDEP activities or, in fact, any of those processes.
You talk about these large potential employers. We are working, wherever we can, to ensure that we're providing leadership in that area. The Commonwealth are, in fact, quite large employers in the community. You mentioned Mr Fred Chaney, a previous Liberal minister. Well, if you'd also followed the processes at Garma, he was quite complimentary—not of mine—of the government's initiatives and the new changes to move to CDEP. In fact, I think he suggested he was going to build an extremely small statue in his garden to commemorate the changes.
We've relied on more than letters in Warburton. In fact, the response we gave you today actually itemised around 15 points on communication. Yes, you've got a letter but, as you said: we send a letter in these cases, but we don't rely on that at all. What we do rely on is people knocking on doors. We rely on using local people, because they have that local knowledge. It is very, very important that we continue to rely on that local knowledge. That's why we're able to, in 90 per cent of circumstances, ensure the breach is avoided.
You also mentioned, Madam Deputy President, that we have substantially used the employment of providers. It's those providers who need to depend on local knowledge. You may not be aware, but it was only 2½ months ago that I stood in Cairns and told all the employment providers in this space that, if they were not an Indigenous organisation by 30 June 2018, they would not have a contract with the Commonwealth. I know that that has had a significant impact in that they are out there now, making sure they have a joint venture with local Indigenous people who have that network and can offer the jobs to local Indigenous people, as it was in the original CDEP days.
Can I complete my remarks by simply saying that we are moving to a new model, and that model is not a government model. It is a model that has been put forward by the communities, and it is going to be a wage-based model. This wage-based model will ensure that we move from poverty in these communities and increase the amount of money that people are actually getting. It's going to move to ensuring that an economy and the synergies of investment by the Commonwealth and states and territories can be acted upon and we can use those synergies for benefit. Again, in closing, Madam Deputy President, I just wanted to correct all of those errors in your contribution.
Senator SIEWERT (Western Australia—Australian Greens Whip) (15:25): I wanted to make a contribution to this debate—I'll keep it short. I am going to talk about some of these matters at a later time in the chamber. Firstly, I want to pick up on the comment that around 90 per cent of these penalties were waived. If that is true, all I can say is that I cannot imagine what impact the community would have felt if none of them were. I also was in Warburton during the winter break, and I saw and talked to people firsthand about the devastation—it's true to say 'devastation'—that has occurred in the community in terms of the penalties that have been applied. What the minister conveniently forgets to add is that it was 90 per cent of the eight-week breaches. I have not had the answer, but I have asked this question: what percentage of the breach does someone serve before they are then waived? They don't waive the no-show, no-pay rule. There are hundreds and hundreds and hundreds—in fact, thousands—of no-show, no-pay people. So that means that people lose money every day, and that is having a devastating impact on community. I've been in the community and I've talked to people about it, and the impact it is having is showing in the shops—in the stores, I should say. It's not fair to say, as the minister also implied, that there's a great move to Aboriginal and Torres Strait Islander groups as providers. I haven't seen a lot of evidence of that to date, and there are certainly still a lot of non-Aboriginal providers.
The minister made comments around moving to wages. I was really pleased when I heard at Garma about moving to community based wages, but there's no meat on the bones of the comments at this stage. The minister made the comment at the time they moved from RJCP. There are some issues around RJCP about which I agree with the minister; there certainly needed to be changes, and the communities were very clear about that. They all thought that they were getting CDP—that they were moving to community based wages, when in fact that clearly was not the case. The government have now said they are in fact going to move to that, and I will be very pleased to see that. We've got to take them at their word that they're going to be doing that, but at the moment we just can't judge that because we just don't know what that's going to look like. So I'm not getting too excited until I do actually see directly what exactly CDP is going to look like.
I have, in fact, seen the piles of letters that are turning up—just the Centrelink letters—in Warburton. I have actually seen with my own eyes the letters that are turning up—not necessarily the breach letters, but the letters with which Centrelink is communicating with income support recipients. That's an example of what is happening in other communities. It's terrifying. It's terrifying how Centrelink are communicating with Aboriginal people who are on income support. I have another example in Warburton. In fact, I suspect that Centrelink, when ringing in from Queensland into Western Australia, don't just forget about Australian Central Standard Time; I actually think they're ringing on Queensland time. I think they forget that they're in fact talking to different time zones, because when I myself was in Warburton—and I'll talk about this a bit later as well—twice while I was there they made appointments to ring people and did not ring at the right time. So who knows? Sometimes it might be Central Australian time. Sometimes it might be Queensland time. Who knows? All I know is that it has direct impacts for those on the ground who, if they don't turn up to their interviews, can get cut off. It's appalling.
Addressing CDP, I think we need to get on the record really clearly—which the Senate inquiry will do—the impacts that it is having in real life on people's lives. A lot of people have said to me: 'What happens now with all the damage that's been caused? Do we just forget that? Do we just forget what damage has been caused in these communities from CDP?' I tell you what: Aboriginal communities won't be forgetting the damage that's been caused by CDP.
I will be pursuing the issues that have been raised in Warburton a bit later, but in the meantime I think we urgently need to find out what is happening with CDP and when we can expect to see the meat on the bones of that particular program.
Senator DODSON (Western Australia) (15:31): I rise also to speak to question on notice No. 477 in support of the statements by you, Madam Deputy President. It seems to me that the minister should not hide his talent under a bushel. He obviously has many things on his plate and he has great intentions, but in this place you actually have to translate that into written form by way of legislation or by way of policy and written documentation. So I would encourage the minister, with his best intentions—and I've had several discussions with him, and I know that he has the best intentions—to translate that into writing so that the rest of us can be privy to what we cannot perceive without him putting things in writing.
The issue of breaching rates and the way the CDP has been rolled out in these communities is a hugely significant one. Let us just look at what's happening in my state of Western Australia, as has been mentioned, particularly in the Ngaanyatjarra lands. The Ngaanyatjarra Council and Aboriginal Corporation represents the interests of around 2,000 Ngaanyatjarra, Pitjantjatjara and Pintupi traditional owners who reside in the 12 member communities of the Ngaanyatjarra Council, the largest of which is Warburton. We've heard about Warburton today.
I've seen the impact of CDP and the way it has been rolled out on my visit to Warburton, and I know when the committee visits Kalgoorlie for the hearings we'll learn more. Warburton, the largest community in the Ngaanyatjarra lands, was established as a Christian community in 1934. Warburton is located 1,000 kilometres from the two nearest regional centres, Alice Springs in the Northern Territory and Kalgoorlie in Western Australia. Warburton has approximately 500 Aboriginal residents and more than 50 agency staff.
In a very clear submission from the Ngaanyatjarra Council to the Senate committee investigating the CDP they've said:
… the work done through the CDEP has been replaced by 'work for the dole'. This is not paid work but serves to establish and maintain entitlements to welfare benefits. The required number of hours has increased from 17 to 25, and the penalties for any breach of conditions (usually absences) can lead to a suspension of benefits lasting nearly two months.
The design of the CDP is explicitly based on an assumption that a regime of incentives and disincentives, if sufficiently punitive and applied over an extended period of time, will eventually teach Ngaanyatjarra people the value of regular work. History suggests there is no basis for this assumption. In practice, CDP requires adults to meet their income support obligations by undertaking work-like activities, often relatively meaningless tasks and under strict compliance arrangements. This is a hopeless vision of life on the Lands.
The chairman of the council, Mr Dereck Harris, wrote in his covering letter:
We now find ourselves in a situation where desert people cannot feed their families. People don't know what they can do to fix this problem. They feel frustrated and helpless. This is bad because people move to places that have a Centrelink office and many get into trouble when they're away from their own country.
The predecessor to the CDP program, the CDEP, was introduced into Warburton in 1979. It was not perfect, but it was adapted to the needs, interests and concerns of the community, as Ngaanyatjarra Council described it. The main advantage of CDEP was the flexibility it gave to community administrators. It was relatively easy to fill vacancies in the CDEP workforce, respond to emergencies, reprioritise jobs and so on. The strengths generally outweighed the weaknesses. In addition to funding municipal services, CDEP programs focused on housing renovations and maintenance that often occurred under the supervision of a non-Aboriginal tradesman that not only kept housing stock in order but provided practical on-the-job training. Workers were paid to assist in the development of outstations and infrastructure and work on restarting the cattle industry. Thus, five decades after the foundation of the mission, the CDEP program offered, for the first time, the possibility of full employment, albeit in circumstances and on terms that took account of some of the powerful cultural dynamics that characterise Ngaanyatjarra cultural and social relations.
The contrast of the present situation with the CDP program is stark and worrying. As Ngaanyatjarra Council again puts it:
Now, the communities in the Lands are forced to fit into a centralised welfare system where the administration of income support is the responsibility of the Department of Prime Minister and Cabinet, the Department of Human Services and Centrelink. It is dependent on the use of the telephone and internet, unreliable technologies in remote locations, the failures of which place huge pressures on participants and the staff attempting to support them. The CDP and the Ngaanyajtarra Lands are a bad fit.
Not only has CDP destroyed the sense of agency among Ngaanyatjarras that had been fostered over decades, CDP threatens the very viability of the Ngaanyatjarra Lands communities.
These are extremely worrying concerns. The Senate Finance and Public Administration References Committee is undertaking a hearing into the CDP program. We'll be hearing from community members and providers in Kalgoorlie, Alice Springs, Papunya, Townsville and Palm Island. We'll also be hearing from academics who have studied the ways in which this program has been rolled out across Australia. The submissions we have received are tending to emphasise the points that have been made already about the program by Ngaanyatjarra Council. This goes to the heart of what meaningful work looks like in our remote communities.
While the CDEP scheme of the past was not a perfect program, it provided some sense of meaningful work and contributed to local communities' development. It allowed for community access to surplus funds. This is sadly lacking in the way that the CDP was designed and is now being delivered. I'm hoping that the committee hearing process can point to a new direction for the rollout of work programs in remote communities. I'm hoping that any such reform program can deliver meaningful work, award-wages equivalence and the promotion of work entitlements such as superannuation and annual leave. I hope these are in the minds of the minister. The sooner we get clearly from the minister what he intends to do about this particular space we'll be better off, and those people who rely upon the services will also be better off.
Senator PRATT (Western Australia) (15:39): I rise this afternoon to speak on the failure of the minister to answer this question in a timely manner, noting that he has now answered it. If you look at the minister's answer, you see it falls into the category of 'if you don't ask exactly the right technical question then the department will use every opportunity to deprive you of the actual data that you're looking for,' when you know full well that they know exactly the information you are looking for. So I hope that much of this information does in fact come to light through the Senate inquiry that is now underway, because what's going on is this failed CDP is failing thousands of people in remote communities with devastating consequences on them at a personal level. It seems extraordinary to me that, confirmed at estimates, last year from July to just September, some 54,000 penalty notices were issued. And there have been more than 200,000 breach notices handed out since the new version of CDP began back in July 2015. What's amazing about this is that there are only 35,000 people in this program. So the idea that you could have 200,000 breach notices for a program that has just 35,000 people in it just shows what a heinous, overly bureaucratic, heavy handed program this actually is.
If the government were looking at where they really want to put their energy, where they really want to put their investment, it's not in punitive programs like this. Just think about the effort that it takes to regulate, control and send 200,000 breach notices. If the government were to reinvest that level of energy into supporting activities that are culturally determined by people locally on the ground, that would be meaningful for people to participate in. There are proposals that, frankly, have been about for some time about what these kinds of CDP programs could alternatively look like. We must go down the path of making those changes.
Senator Scullion, like me, was up in Senator Dodson's neighbourhood a couple of weeks ago for the Kimberley Land Council's Kimberley Ranger Forum. It's such a wonderful program that engages people in caring for country, caring for culture, and with meaningful economic and social outcomes. They are the kinds of programs that we should be investing in. We see communities desperately trying to cobble together resources to expand programs like the ranger program and they're being denied the opportunity to do that. A really good example of this were some wonderful women rangers that I met who are using Green Army funding to become rangers, and they've been monumentally successful. But the problem is that the money is about to run out, and they will be without jobs.
So what we see is the failure of the government to engage in the creation of meaningful opportunities, while they've got this heavy handed punitive approach to CDP. What we can see is that suspending people's welfare does not resolve the shortage of remote jobs. We need to see real engagement with these communities to create jobs. Nor indeed does this punitive approach encourage people to move off country in search of work elsewhere. The warnings in the ANU report that closing CDP would increase welfare dependency and impoverishment were indeed warranted. So the closure of the old CDEP and the creation of the CDP has indeed seen increased welfare dependency and impoverishment as a feature of the program. That was a finding of the ANU.
Indeed, they also said that there's a vastly disproportionate application of income penalties to CDP participants as compared to the equivalent program, such as the jobactive program, in non-remote areas. We have just 35,000 people engaged in this program, yet the statistics that were shown to me from APO NT demonstrated that those 35,000 people were subject to just about double the number of breaches compared to the general population involved in jobactive breaches, when in fact there are tens of thousands more people involved in jobactive programs than in CDP. The implications of this, according to the ANU, are profound. What you can see is that participants are incurring multiple penalties in a very short period of time. Again, I reflect back on the statistics I gave before, which were that we had some 54,000 penalty notices in just three months. This includes high rates of serious penalties that result in people being cut off welfare payments for eight weeks.
We know that job outcomes in remote areas are complicated and limited by a range of factors and that this is slow to resolve, but we can't resolve it through these punitive kinds of programs. We've got to resolve it through buy-in from the local community about the kinds of activities that are meaningful to their social and economic development—just as the ranger program does—and that are determined by people themselves, not through this very punitive process that we have with CDP. What we see with the program as it exists currently is increased harm, including poverty, a reported drop in food sales, increasing debt and a greater risk of incarceration when the suspension of welfare payments limits people's ability to make payments towards things like fines. We know that too many people in remote communities are locked up simply because they have fallen behind on fine repayments or can't pay them.
I've spoken to CDP participants whose confusion, frustration and anger about these issues is absolutely palpable. I'm pleased that there are an increasing number of Indigenous organisations and CDP providers mounting challenges against the scheme. I note that the Human Rights Commission have been asked to investigate whether the program is discriminatory, given that it is mostly affecting Australia's Aboriginal and Torres Strait Islander people. I also commend the ACTU for examining the scheme on the basis that it doesn't provide the kinds of benefits that standard employment should provide.
Behind the scenes, happily, there's a flurry of activity, as Aboriginal organisations concerned about these detrimental effects get organised, and I wish them well for the Senate inquiry that is underway. But, I have to say, it's no thanks to the work of this government and indeed our own Minister for Indigenous Affairs, Nigel Scullion, who've seen fit to put this heinous, punitive approach to Indigenous participation in employment in place.
Question agreed to.
QUESTIONS WITHOUT NOTICE: TAKE NOTE OF ANSWERS
Broadband
Senator O'NEILL (New South Wales) (15:49): I move:
That the Senate take note of the answer given by the Minister for Communications (Senator Fifield) to a question without notice asked by Senator O'Neill today.
It's a long time now since we heard the answer to the question, because we had some very important questions that were raised by you, Senator Lines, and by those who participated in the recent debate. In that ensuing period of time, the minister's absolutely forgettable answer is another example of how detached this government is from the real and pressing problem that is confronting Australians, who are getting sold an absolute dud of an NBN.
The first part of my question was about complaints that were put on record by TPG who said: 'With fibre to the node'—which sadly has been now inflicted on 4.5 million Australians and delivered the inferior technology decided for them by Prime Minister Malcolm Turnbull—'we're not allowed to lodge a fault with the NBN, unless the line performs at less than 12 megabits per second'. In response to that concern, which is of such significance to Australians right across this country, we got the equivalent of buffering from Minister Fifield—the wait for a proper answer while it just goes around and around in a circle. We keep hearing the same thing over and over again. That's the experience that people are having across the country. It's not just that circle of watching the buffering going on; it's the dance where you get sent from NBN to the retail service provider. Now let's add the fact that it could be your modem, so you get sent to the shop to spend a few hundred dollars on a modem that you don't need, because the problem isn't your modem. The problem is that your government is inflicting this disaster on you, and your experience as a business is absolutely devastatingly bad.
We've heard evidence in the last several weeks, in the north of Tasmania and also on the Central Coast, where I come from, which reveals how taxing this experience is. The minister's says in his most reasonable voice: 'Look, if you're having a problem, just talk to your retail service provider. They'll fix it up. Or, if that isn't good, talk to the Telecommunications Industry Ombudsman. In all sincerity, I'm sure you'll have your problem fixed.' The problem isn't getting fixed. The minister is not on the job. He doesn't give a damn. He doesn't care about the fact that we're getting evidence like this from Belinda Mabbott, who runs a fantastic small landscape supply business on the Central Coast, who says: 'Over 12 months nearly to the day, we managed to rack up 17 case managers; at least eight technicians' appointments—only two came into our yard—a full folder of emails with thickness of two centimetres; countless phone calls and messages to my mobile; paperwork; submissions to the ombudsman; and finally a call to our local member, Emma McBride, who subsequently got us the assistance that we needed.'
That's what's happening across this country. The Liberal members are like the minister; denying the problem, ignoring the reality, cruelling people's businesses and cruelling people's access to essential services. There's a wonderful gentleman by the name of Mr Barry Egan, who gave me an absolute wad of paperwork in which he had documented his experience. He's really concerned that older people, who haven't got as much energy and capacity as he has, are actually suffering in silence. They are being rejected by the TIO, rejected by their retail service provider. They are spending money on modems that don't work and, all the while, this minister ignores the reality.
We heard evidence in Tasmania—and Senator Urquhart is whipping here for us on the opposition benches. She was absolutely on a unity ticket with the CEO of the copper mine in north-west Tasmania. A copper mine—remember, we're getting our telecoms down the copper, the technology from last century. The CEO, Mr Peter Walker, said and agreed with Senator Urquhart, that copper won't cut it. Everyone knows it. Even the man who is an advocate for the copper mine knows it. He knows he has to have fibre to do the job that he needs to do to get the efficiencies in and create jobs for people in north-west Tasmania.
We heard from Virginia Bower, a podiatrist from the St Johns Foot Clinic. This is how she described her experience of trying to get the NBN on, and the cuts to services that she's experienced in her business: 'Effectively, we were electronically handcuffed.' I wish I had a dollar for every time I've heard: 'Oh my God. I just wish I had my ADSL back.'
The NBN has been a wasteful rollout of $49 billion by people who should have known better. Instead of listening to the experts, they delivered and inflicted Malcolm Turnbull's mess on us. Thank you.
Senator PATERSON (Victoria) (15:54): In Senator O'Neill's interesting contribution, there was one fairly major omission—one major fact in this debate that went unremarked upon—that I think is worth repeating and placing on the record as a matter of history.
How did we get to where we are today with the NBN? We didn't get here because the coalition proposed and suggested that it was a good idea for the government to build a national network of communications. We didn't get here because we commenced during our time in government a multibillion-dollar scheme to push aside the private sector and institute a government intervention on a national scale. We didn't get here even because the private sector embarked on this and were not successful. We got to where we are today because a government which she was part of, the Rudd government, decided that it knew best. The Rudd government knew best. The Rudd government would be able to build a national broadband network, it would be able to build it better than the private sector and it would be able to build it with no costs, no consequences, no faults and no issues.
Well, look what's happened. Look what's happened, first on their watch, and then look at the effort that we've gone to to fix up the mess that they left us. On their watch, by 2013 Labor fell short of 83 per cent of their rollout targets—83 per cent! It was a dismal failure on their watch. What has this government had to do? This government has had to make the tough decisions necessary to deliver this program, to deliver it on time, to deliver it on budget and to deliver it in a meaningful way for the Australian people.
It was the Labor Party which was dismally failing to achieve these targets when they were in office. By contrast, in just a few short years upon coming to government and by making some tough decisions about the best way to roll out this program, the Turnbull government has delivered. The Turnbull government has ensured that the NBN is in fact being rolled out, that it is in fact being connected to people's homes in a way that it never would have been under the previous government. We could have had no guarantees that it would have been done under the previous Prime Minister.
We know that, because when it was on their watch, when it was under their stewardship, they failed time and time again. They met none of their financial targets and they met none of their rollout targets. It was a failure that had to be fixed. That's the contrast. This government, upon taking over this program, took it over with a pretty dismal statistic in place: 51,000 fixed and wireless premises had been rolled out by the previous government—51,000! By contrast, each week under this government 32,000 connections are rolled out for a total of 5.8 million addresses that are today NBN ready and 2.6 million customers that are connected.
Senator O'Neill described it as being 'inflicted' upon these people. I doubt that's how they feel about the NBN service that they are now able to access, and are able to access in a more affordable way than they would have been able to under the previous government. They have it all, when there was no promise that it would ever actually get there under the previous government and under their method of delivery. More than 11,000 premises have been made ready for service on the NBN every working day in the past year. We achieve in a week what the Rudd government was not able to achieve in years under their program.
The Turnbull government takes very seriously the complaints and concerns that some consumers have raised about their transition to the NBN, and we have a number of initiatives in place to respond to those concerns. In April, the government announced funding for the ACCC to conduct a broadband performance monitoring and reporting program. The ACCC is currently seeking 4,000 volunteer customers of retail service providers across the country to participate in the monitoring program. The BPMR program will enable consumers to compare speeds delivered in peak periods by independent reporting of broadband speeds. Performance information is a key factor for consumers when purchasing their plans from their retailer.
As the minister outlined in his answer to the senator's questions in question time, there are a number of factors that can lead to slower-than-expected performance, and many of those factors are of course in the hands of retail service providers, not the NBN. In addition to the ACCC program that I mentioned, the Turnbull government is empowering ACMA to conduct research and collect data on the NBN customer experience. ACMA is commissioning this research to obtain information directly from customers about their experience before, during and also after migration to the NBN. The research will span the range of technologies that are used to connect households and businesses to the network. ACMA will be using its formal powers under the Telecommunications Act to collect information from businesses across the NBN supply chain.
This is a government which is fixing Labor's mess on the NBN. This is a government which is delivering the NBN in a way they never could.
Senator BILYK (Tasmania) (15:59): Once again, Senator Paterson is just putting government spin on something that is completely untrue. The minister's answer has revealed just another chapter in the saga of the delays, the cost blowouts and the broken promises in the rollout of Malcolm Turnbull's second-rate copper NBN.
When Mr Turnbull changed the method of delivery for fixed line premises, he called it the 'multitechnology mix'. My constituents in Tasmania are calling it 'Malcolm Turnbull's mess'. They're blatantly calling it that. They have no regard for what the government has done to what the Labor Party initially started as a great process. We all remember, before the 2013 election, when 'Mr Broadband' himself stood before the then Leader of the Opposition, Tony Abbott, hoping to be the leader once again—we know that—and promised that the NBN would be delivered by the end of 2016. Well, can I tell you he missed that target by 7 million homes.
Mr Turnbull also promised that the NBN would cost $29.5 billion. That cost has now blown out to $49 billion. And, because private investors don't want to go anywhere near Mr Turnbull's second-rate copper network, the government has had to bail out the project with a $19.5 billion loan. In 2013, Mr Turnbull promised NBN users of his second-rate copper network that they could upgrade to full fibre for $2,250. Well, the average cost to date is $15,800, and some individuals have been quoted as much as $149,000. It's no wonder that NBN customers on the second-rate copper network want to upgrade to full fibre, because the copper network is a mess. A recent Choice survey found that NBN users are experiencing slow speeds and dropouts 76 per cent of the time.
The NBN Co's chief, Bill Morrow, might like to blame customers or the retail service provider—in fact, anyone but his own company—but Australians aren't buying it. They know that under the instructions of Mr Turnbull, Senator Cormann and Senator Fifield, that NBN Co are rolling out an outdated network using last century's technology. And we know on this side that the overwhelming majority of complaints about service dropouts and slow speeds relate to the second-rate, copper based NBN. Figures from the Telecommunications Industry Ombudsman show that an NBN user is five times more likely to complain than users of other telecommunications services. And seven out of 10 of the postcodes that the TIO receives complaints from are served by fibre to the node.
I know personally about these complaints, as do my Tasmanian colleagues in the House—Julie Collins, the member for Franklin, and Brian Mitchell, the member for Lyons—because, along with Michelle Rowlands, our shadow communications minister, we held a public meeting. We had over 100 southern Tasmanian residents in a room that was packed. We held this meeting a few weeks ago. We heard those residents talk about the delays, the dropouts, the multivisits by technicians and being sent two or three modems. Almost all of these related to Mr Turnbull's outdated copper network.
And, just while we're talking about Tasmania, I still have to remind people—I've talked about it a few times—that there's a little area about 17 minutes south of Hobart called Howden, with 600-odd households. They were completely left off the map continually until I started asking questions in estimates about why they kept being left off the map. They couldn't get anything. They are 17 minutes from a capital city and they couldn't get access to anything. As I've said before in this place, a full fibre rollout for fixed-line connections is inevitable, because it's the technology that Australians not only need but they're actually demanding for today.
Fibre to the premises is the technology we need if we are to compete in the global digital economy. It's the technology, let me remind people, that is being rolled out by competing nations overseas, including in the UK, where British Telecom is considering building a full fibre network. That's right. That is the same British Telecom that Mr Turnbull pointed to as an example of the success of his flawed copper based approach. They're now considering plans to deliver— (Time expired)
Senator WILLIAMS (New South Wales—Nationals Whip in the Senate) (16:04): I'd like to contribute to this debate. It's quite amazing: where's Senator Conroy? Senator Conroy ran in the 2 July election last year. He was elected for six years, I believe, but he's done a runner; we can't find him. Let's go back to Senator Conroy. What did he do? He hopped into the plane with then Prime Minister Kevin Rudd and pulled out an envelope with the original plan of the Labor NBN. What a way to plan to spend billions and billions of dollars—riding around with an envelope in a VIP jet with the then Prime Minister, Mr Rudd. So, away went the Conroy plan for the NBN!
I remember when they came into Armidale. I was there about to catch a plane from Sydney to Canberra—I believe Senator Conroy was actually on the plane back with me—when the VIP jet came. There was a big stage, a chart and an electronic board. They were there, with the cameras, to pull the switch to turn on the NBN in Armidale. There it was: the flashy political show put on by the then Prime Minister, Ms Gillard, and former senator Stephen Conroy. They pulled the switch down and said, 'It's on. Now Armidale has the NBN.' There was only one problem: there was nothing hooked to the back of the switch. There were no wires there. It was a big show piece. How proud they were about the NBN going into Armidale! But then the problems started. That's what happened: we inherited a mess from Senator Conroy and former Prime Minister Rudd's back-of-the-envelope planning of the NBN
I would remind the Senate that the NBN has met its milestones over the last three financial years, as we've tried to clean this mess up. It remains on track and on budget, with more than half of all households now being able to access an NBN service. Let's look back a bit. Let's not forget that Labor's NBN fell 83 per cent short of its 2013 rollout targets. That means just 17 per cent of the targets were met. That's not a very good record. So much for serving the interests of broadband consumers! Only 51,000 fixed and wireless premises were ever connected to the NBN under Labor, whereas under the coalition government the rollout has now reached a new peak of more than 32,000 connections in a single week.
Opposition senators interjecting—
Senator WILLIAMS: There are now 32,000 connections in a single week, and you had 51,000 over how many years? It's a big difference. The peak funding target of $49 billion announced almost two years ago has stayed the same, as has the completion date of 2020. Sure, it's taking longer to roll out the NBN. It's a big country.
I'm very pleased to see so many of the wireless NBN towers being constructed in rural and regional areas. I was talking to my wife, who runs a small newspaper, just recently. She told me that previously, when another of the few independent newspapers left in northern New South Wales had finished putting their paper together and sent it off to the printers, it would take 1½ hours to email a 12-page newspaper to the printer. Now, with the NBN, it takes them 45 seconds. That's a big difference—1½ hours to 45 seconds. That's the improvement.
Sure there are some gremlins. I'm aware of that. I've had people ring me and say: 'We've established a new business. We've notified Telstra and other carriers, who'll be hooking us up, and we'll be starting the business next week.' They've given a month's notice to Telstra, but, when they open their business, there's no phone and no NBN. We've got a bit of a blame game going on. Some of the telcos are blaming NBN Co, while NBN Co are saying: 'It's not our fault. We've hooked it up. The telcos are not doing their job.' I hope that blame game stops, and we get it rolled out and completed as soon as possible. But it is a big country, and I commend Minister Fifield for the work he's done with the NBN after inheriting a mess from Senator Conroy. I wonder why he left? Never mind. He packed up and did the bolt.
NBN Co has hit every rollout target in every quarter for more than three years, and the company is now transitioning from building the network to also being an operator of critical national infrastructure that is serving millions of homes and businesses across the nation. Over the past year the number of premises able to access the NBN has doubled, so it's getting there. It's rolling the NBN out quicker than it ever did under Labor, and I think it's very cheeky for Labor, through Senator O'Neill, to even raise this topic, given the mess they made of this organisation. (Time expired)
Senator CHISHOLM (Queensland) (16:09): I think the problem for those opposite that they fail to grasp here is that they've now been in power for four years. Yes, more people are connecting to the NBN. And that is effectively the problem: more people are connecting and realising what a dud this NBN is. And there are many customers out there disappointed with the lacklustre response they get from the NBN. Today, I think what we saw from Senator Fifield was a lacklustre response to our question that was put to him. Every day, you see another disappointed NBN customer, whether it be through the work that the NBN committee has been doing or whether through the series of NBN crisis forums that have been held throughout Australia over recent months. I know that there was one, as Senator Bilyk mentioned, in Tasmania. I hosted one in the northern suburbs of Mackay. The member for Oxley hosted one as well. I know that they've also been happening in South Australia. I commend the work that Michelle Rowland, as the shadow minister, and Stephen Jones, as the shadow minister for regional communications, have been putting in, listening to the concerns of people particularly in regional Queensland.
There is a consistent message coming through from people: they're disappointed with the NBN. It's causing frustrations, it's costing jobs and it's denying Australians opportunities, particularly for those in regional Queensland. For many years, regional Queenslanders and regional Australians looked upon the NBN as a great opportunity. They thought that it would provide economic opportunity. They thought that it would provide educational opportunity. And they thought it would provide health opportunities, particularly for those in regional and remote areas. But the reality is hitting home, and the people of regional areas, in particular, are very disappointed.
As I mentioned, every day there is another media report about how inferior this product is and the frustrations that it is causing. I mentioned the NBN crisis forums that have been held across Australia in recent months. And there was a consistency of views that came through. One was around NBN technicians not turning up for appointments when they were scheduled, or failure to match advertised speed once they had been connected. More than half Australians have had disconnections or dropouts and speed slowdowns in the last six months. The service is notoriously unreliable. And I think those opposite are believing the constant spin from the NBN Co themselves and their ever-growing number of PR officers to believe that this is actually functioning effectively for them. But the problem is: no-one is willing to take ownership of the problem. Even though they've been in government for four years, they're continuing to blame Labor. But the punters are working them out. They're connecting, they're the ones who are frustrated and they're the ones who will hold this government to account.
As I mentioned, I was in my duty electorate of Dawson a couple of weeks ago and we held an NBN crisis forum. It was interesting that the member for Dawson, George Christensen, ordered a couple of NBN staff to go along to hear the complaints firsthand. I think it shows you how concerned they are about the impact this is having on the community. We heard a number of reports from businesspeople in the community about the negative impact that the NBN is having. This was consistent. We heard from Lyn, who had to extend her eight-hour work day to 16 hours so that she could operate at speed outside of normal working hours. We heard from Mark, a small business owner. His business is redoing floorboards. You could imagine that in the aftermath of Cyclone Debbie it was a really important business. The phone number he got given six months ago was still not connected. Although he was advertising his services, when you actually rang to repair your floor after the damage of Cyclone Debbie you couldn't actually get through. So this was costing jobs and economic opportunity but also the ability of people to rebuild in those cyclone-affected communities.
We also heard from a family who said that their daughter, to use the internet, had to go to the local Macca's to use the wi-fi to do her homework because it was more reliable than the service offered from the NBN. I heard numerous stories throughout regional Queensland. When I was at Annandale State School I heard about the failure to connect with the School of Distance Education to do coding training. There was a series of problems in regional Queensland that were identified with the NBN that is being delivered by this government. They have had a lame duck as minister—the previous minister responsible, who is the current PM. They've seen the same under Minister Fifield as well. (Time expired)
Question agreed to.
QUESTIONS WITHOUT NOTICE: ADDITIONAL ANSWERS
Marriage
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (16:14): I seek leave to correct an answer I provided in Senate question time today.
Leave granted.
Senator CORMANN: I thank the chamber. This is in response to a question from Senator Rice earlier today, in relation to the marriage law survey. I was asked a question in relation to, among other things, the closure of the electoral rolls, and I indicated to the chamber that the electoral rolls, for the purposes of the marriage law survey, would close at 6 pm on 24 August. In fact, the rolls will close at midnight on 24 August, local time, and I thought it was important to correct the record at the earliest opportunity. The initial advice was that it would be 6 pm, but the decision was subsequently made to extend that to midnight.
QUESTIONS WITHOUT NOTICE: TAKE NOTE OF ANSWERS
Marriage
Senator RICE (Victoria) (16:15): I move:
That the Senate take note of the answers given by the Minister for Finance (Minister Cormann) to questions without notice asked by Senator Rice today relating to marriage.
I seek to take note of the answer from Minister Cormann to my question about the marriage equality postal plebiscite. The totally unsatisfactory answers that we got from the minister are really what we've come to expect from a government that is willing to use lesbian, gay, bisexual, transgender, intersex and queer people as pawns in the sick game that they are playing. This is from a government that is being led by a Prime Minister who tells us that he supports marriage equality but is clearly just a husk of Tony Abbott. It is just so that he can show the right-wing troglodytes in his party that he is conservative enough.
Minister Cormann claimed, in response to my question about disenfranchising young people, that they are giving every Australian the opportunity to have their say on marriage equality. It is every Australian, they claim—except, however, for the more than 50,000 18-year-olds who won't be able to vote. These are the people who will turn 18 between 24 August and 7 November. This is unlike other elections, where you can set the roll so that 16- and 17-year-olds can pre-register, so that—right up until the day of the election; right up until the very last minute of them turning 18—they can vote. In this postal plebiscite, 2½ months will go by where people will turn 18 and they won't be able to vote—let alone the 16- and 17-year-olds that the Greens think should be able to vote in such a postal plebiscite or in any vote about marriage equality, because, if 16- and 17-year-olds are old enough to get married, as they are, surely they are old enough to vote. So we in the Greens are going to continue to pursue this. We say that 16- and 17-year-olds, young Australians who are old enough to get married, should be old enough to vote in any public vote about marriage equality.
We know that having this shonky postal plebiscite is going to disenfranchise young people in general. Young people are much less likely to be on the electoral roll. Young people are more likely to have changed address. And yet we know that it's young people in our society who are most passionate overall about marriage equality, because they know that love is love. They've grown up, as my children have, to know that people are same-sex-attracted and to know that people are gender diverse, and they just accept people for who they are. And they are the people that can't understand why we are taking so long and why we can't just move to have a free vote in this parliament and achieve marriage equality, so that any two people, regardless of their sexuality or their gender identity, are able to marry.
If this shonky postal plebiscite ends up going ahead, if the High Court challenge against it isn't successful, we, as Greens, are going to be campaigning strongly, just as we are advocating strongly in this parliament for us to be voting yes, so that people can marry the person they love. If this plebiscite goes ahead, we will be campaigning very strongly for people to be choosing love and voting yes.
We'd already begun this campaigning over the weekend. And we know that the number of people—particularly young people again—who have enrolled to vote in the last four days has been amazing. They would prefer the parliament to just get on and do its job, but, if it comes to a postal vote, they want to be on the roll. The problem, though, as I say, with this postal plebiscite and the reason why it would be much better for this parliament just to do its job is the reason that I'm in the High Court, that we have a High Court challenge against this postal plebiscite, and it's all the reasons that I outlined in my question to Minister Cormann today. This postal plebiscite is disenfranchising of young people, as we've already discussed. And then, in terms of privacy, it's either going to be fatally subject to fraud or fatally undermining our privacy. You can't have it both ways. These are the problems with having a postal vote on this issue, and it has such potential to cause harm and division.
But we know that in the end love is going to win. We know that in the end we are going to have a vote in this parliament that's going to legislate for marriage equality. It may be a vote in this parliament immediately after the High Court challenge knocks off this plebiscite and throws it in the bin, or it may be that we've got to go through this tortuous course of a postal vote, but in the end there will be a vote in this parliament and love will win. People will choose love and love will win. (Time expired)
Question agreed to.
PETITIONS
The Clerk: A petition has been lodged for presentation as follows:
Plebiscite on Marriage
To the Honourable President and members of the Senate in Parliament assembled: The petition of the undersigned shows:
The Coalition Government was re-elected promising to hold a plebiscite on the legal definition of marriage.
As such Australians deserve to have their say.
Your petitioners ask that the Senate respects the will of the Australian people and passes enabling legislation for a plebiscite on marriage to be now conducted.
by Senator Cash (from 49 citizens).
Petition received.
COMMITTEES
Regulations and Ordinances Committee
Delegated Legislation Monitor
Senator WILLIAMS (New South Wales—Nationals Whip in the Senate) (16:21): On behalf of the Chair of the Senate Standing Committee on Regulations and Ordinances, I present the Delegated Legislation Monitor 9 for 2017.
Ordered that the report be printed.
NOTICES
Withdrawal
Senator WILLIAMS (New South Wales—Nationals Whip in the Senate) (16:21): I give notice of my intention, at the giving of notices on the next sitting day, to withdraw business of the Senate notice of motion No.1 standing in my name for 15 August 2017, proposing the disallowance of the Legislation (Exemptions and Other Matters) Amendment (Sunsetting and Disallowance Exemptions) Regulation 2016. I seek leave to make a brief statement for about one minute and 20 seconds.
Leave is granted.
Senator WILLIAMS: The committee's request for information regarding this regulation arose from concerns about the exemption of the migration regulations from the sunsetting requirements of the Legislation Act. On this occasion the committee has resolved to withdraw its protective notice of motion to disallow. However, it remains concerned about the executive use of delegated legislative power to exempt instruments from sunsetting. The committee's view is that any exemption from the sunsetting requirement of legislation act is a significant matter.
The committee's position in relation to the exemption of the migration regulations from sunsetting is based on the circumstances of this particular case and should not be seen as a general acceptance of exemptions from a sunsetting framework. The committee considers that the circumstances in which an exemption will be appropriate are limited, and it will continue to analyse any such proposal carefully. The committee considers that it is essential for parliament to retain direct oversight of the outcomes of the review process of significant pieces of delegated legislation, including the migration regulations. The committee has, therefore, requested that a provision be inserted into the migration regulations to require the minister to table in parliament the review documentation, including the final report that is prepared for the purpose of the new review process. The committee's comments on this matter are contained in Delegated Legislation Monitor 9 of 2017.
Senator HINCH (Victoria) (16:24): I would like to withdraw general business notice of motion No. 127 standing in my name for 16 August 2017, relating to Australia's justice system.
Presentation
Senator McAllister to move:
That the following matter be referred to the Finance and Public Administration References Committee for inquiry and report by 4 December 2017:
Digital delivery of government services, with particular reference to:
(a) whether planned and existing programs are able to digitally deliver services with due regard for:
(i) privacy,
(ii) security,
(iii) quality and reliability, and
(iv) value for money;
(b) strategies for whole of government digital transformation;
(c) digital project delivery, including:
(i) project governance,
(ii) design and build of platforms,
(iii) the adequacy of available capabilities both within the public sector and externally, and
(iv) procurement of digital services and equipment; and
(d) any other related matters.
Senator Di Natale to move:
(1) That the Senate notes that there are now questions surrounding the citizenship of at least two current senators and one member of the House of Representatives.
(2) That the following matters be referred to the Legal and Constitutional Affairs References Committee for inquiry and report by 14 September 2017:
(a) the eligibility of Senators in the 45th Parliament under Section 44 of the Constitution in so far as it relates to being 'a subject or a citizen or entitled to the rights or privileges of a subject or a citizen of a foreign power';
(b) the legal liability of Senators who know, or have grounds to suspect, that they are ineligible for office but do not come forward with that information, and whether they are defrauding the Commonwealth; and
(c) any other related matters.
(3) For the purposes of carrying out the inquiry, the Committee must as soon as practicable, with the approval of the President, appoint an independent auditor, or auditors, with expertise in migration, citizenship and constitutional law to assist the Committee.
(4) The independent auditor or auditors will be able to request to the Committee to use its powers to order the production of documents from Senators and order them to appear as witnesses and answer questions.
(5) On behalf of the Committee, the independent auditor or auditors may present to representatives of foreign governments in Australia and seek information.
Senators O'Sullivan, Macdonald, Williams and McKenzie to move:
That the Senate rejects the recommendation of the Environment and Communications References Committee in its final report Retirement of coal fired power stations, tabled in March 2017, which calls for the development of a mechanism to retire coal fired power stations in Australia.
Senator O ' Neill to move:
That the time for the presentation of the report of the Parliamentary Joint Committee on Corporations and Financial Services on Whistleblower protections be extended to 14 September 2017.
Senator Hanson to move:
That the Senate—
(a) notes that:
(i) violent extremism in Australia is perpetrated or inspired by terrorist groups that claim to act in the name of Islam,
(ii) the Islamic State of Iraq and the Levant (ISIL) and similar groups exert influence through a violent ideology, persuasive propaganda and the grooming of young people which has produced significant numbers of radicalised Australian Muslims, and
(iii) the so-called 'lone actor terrorists' are in fact part of a wider group of radicalised communities within Australian Muslim enclaves in Australia; and
(b) calls on the Government to ban full face coverings in public places on the grounds of social cohesion, the need to identify people seeking community support and for public safety.
Senator Kakoschke-Moore to move:
That the Senate—
(a) notes:
(i) the importance of women and girls managing their menstruation hygienically, with confidence, dignity and without stigma,
(ii) that women and girls without access to menstrual hygiene products resort to using newspaper, rolled up toilet paper, rags and leaves,
(iii) that the average woman has 450 menstrual cycles in a lifetime, and each cycle will use up to 30 menstrual hygiene items,
(iv) the discussion paper from the University of Queensland and WaterAid Australia, published in July 2017, which noted the challenge of some girls in remote communities who are missing school each month due to a lack of products to enable menstrual hygiene management,
(v) that Australian women earn on average $261.30 per week less than their male counterparts, and they are more likely to live below the poverty line,
(vi) that period poverty is a significant issue for those who are already statistically at greater risk of being unable to afford basic essentials such as pads and tampons,
(vii) that menstrual hygiene items are a necessity and access to these items is a right not a privilege,
(viii) that it is unacceptable that any woman or girl in Australia should be unable to access menstrual hygiene items,
(ix) that, in July 2017, the Scottish Government announced that it will distribute free menstrual hygiene items to those in need as part of a six-month pilot program in Aberdeen, Scotland,
(x) that the pilot program is expected to provide more than one thousand disadvantaged women and girls free access to menstrual hygiene items at various locations including secondary schools, homeless shelters and foodbanks, and
(xi) that a similar pilot program in Australia would represent the first step in developing a sensitive and dignified solution to making these products easily accessible to those who need them; and
(b) calls on the Government to fund an evaluated pilot program in low socio-economic areas around Australia based on the trial in Aberdeen, Scotland, where free menstrual hygiene items are being distributed to women and girls.
Senator Di Natale to move:
That the Senate—supports the immediate creation of a Federal Independent Commission Against Corruption (federal ICAC).
Senator Xenophon to move:
That—
(a) the Senate notes that:
(i) the Murray Darling river system is a national resource,
(ii) the aim of the Murray Darling Basin Plan, agreed to in 2012, is to ensure that water is shared between all users, including the environment, in a sustainable way,
(iii) it is important that the Commonwealth, the States and users comply with the agreed plan,
(iv) on 24 July 2017 the ABC's Four Corners program aired serious allegations in respect of the Barwon-Darling in relation to water pump tampering, theft and rorting, collusion between officials and irrigators, failures by officials to properly monitor compliance and the shutting down of compliance units in the face of alleged non-compliance, irregularity and illegality, and
(v) the Senate has an oversight responsibility in relation to implementation and execution of the Murray Darling Basin Plan and visibility to modelling – financial and compliance data assist the Senate in this regard; and
(b) there be laid on the table, by the Minister representing the Minister for Agriculture and Water Resources, by the start of business on 4 September 2017:
(i) all documents and communications (draft or otherwise) concerning the purchase (proposed or otherwise) by the Commonwealth of water access licences held by Tandou Ltd,
(ii) all documents and communications (draft or otherwise) concerning any modelling undertaken by the Murray Darling Basin Authority (MDBA) for the Barwon-Darling Unregulated River between 1 January 2014 and today,
(iii) all documents and communications (draft or otherwise) concerning any investigations or work undertaken by the MDBA tracking the movement of environmental water in the Northern Basin between 1 January 2014 and today – including documents and communications (draft or otherwise) concerning the legal extraction of environmental water and/or potentially unlawful extraction of water,
(iv) all documents or communications (draft or otherwise) concerning the expenditure of monies from the Water for the Special Account between 1 January 2014 and today including:
(A) any criteria for distributing monies from this account,
(B) any evidence that these criteria had been met by the beneficiary of monies from this account, and
(C) the details of any distributions of monies from this account to individuals or companies with properties on the Barwon-Darling Unregulated River, and
(v) all documents and communications (draft or otherwise) concerning the distribution of monies for the Farm Irrigation Efficiency Program between 1 January 2014 and today including:
(A) any criteria for distributing monies from this account,
(B) any evidence that these criteria had been met by the beneficiary of monies from this account, and
(C) the details of any distributions of monies from this account to individuals or companies with properties on the Barwon-Darling Unregulated River.
Senator Xenophon to move:
That—
(a) the Senate notes that:
(i) the President's report to the Senate on government responses outstanding to parliamentary committee reports as at 30 June 2017 listed the report of the Economics References Committee on the Future of Australia's Automotive Industry as having not been responded to by the Government within the three month timeframe, and
(ii) the Government still has not provided a formal response to the Committee's report, even though it has been 20 months since the report was tabled; and
(b) there be laid on the table, by the Minister for Industry, Innovation and Science, by no later than 3.30 pm on 4 September 2017 the Government's response to the report of the Economics References Committee on the Future of Australia's Automotive Industry tabled on 1 December 2015.
Senators McAllister and Watt to move:
That the Senate—
(a) notes, with concern, the prevalence of bigotry and racism in recent public speech around the world,
(b) condemns statements that target and vilify people on the basis of race, religion, gender, and sexual orientation, and
(c) calls on all political leaders to stand together against bigotry and racism.
Senator Rhiann on to move:
That the Senate—
(a) notes that:
(i) Australia's biggest ethanol producer, Manildra, has donated over $4.1 million to political parties since 1998-99 and was granted twenty meetings with the NSW Minister before a new law on the NSW Ethanol Mandate was passed,
(ii) the Productivity Commission has recommended that the policy designed to increase ethanol use by NSW motorists should be dropped, and that the mandate that 6 per cent of all petrol sold by major retailers in NSW must be ethanol may not achieve the claimed environmental benefits,
(iii) the most recent data from the federal Department of Environment and Energy shows that the E10 program has been a massive flop in its first five months and E10's share of all petrol sold in NSW during this period fell from 24.5 per cent in 2016 to 23.9 per cent this year, and
(iv) these developments add to the perception that corporate political donations have a corrupting influence on the political process; and
(b) calls on the Government to ban donations from industries which pose a particular threat to the integrity and perceived integrity of the electoral system.
Senator Gallacher to move:
That the following matter be referred to the Rural and Regional Affairs and Transport References Committee for inquiry and report by 5 December 2017:
The integrity of the water market in the Murray-Darling Basin, with particular reference to:
(a) the allegations of theft and corruption in the management of water resources in the Murray-Darling Basin,
(b) the investigation and public disclosure by authorities, including the New South Wales Government and the Murray-Darling Basin Authority, of reported breaches within the Murray-Darling Basin, including the Barwon Darling Water Sharing Plan,
(c) the actions of member states in responding to allegations of corruption and the potential undermining of the Murray-Darling Basin Plan,
(d) the use of Commonwealth-owned environmental water for irrigation purposes, and the impact on Basin communities and the environment,
(e) the operation, expenditure and oversight of the Water for the Environment Special Account, and
(f) any other related matters.
BUSINESS
Leave of Absence
Senator URQUHART (Tasmania—Opposition Whip in the Senate) (16:24): by leave—I move:
That leave of absence be granted to Senator Collins for 14 and 15 August 2017, for personal reasons.
Question agreed to.
NOTICES
Postponement
The Clerk: Postponement notifications have been lodged in respect of the following:
Business was postponed as follows:
Business of the Senate notice of motion no. 2 standing in the name of Senator Hanson-Young for today, proposing a reference to the Environment and Communications References Committee, postponed till 15 August 2017.
COMMITTEES
Privileges Committee
Reporting Date
The Clerk: A notification of an extension of time for a committee to report has been lodged in respect of the following:
Standing Committee of Privileges—Parliamentary privilege and the use of intrusive powers—Intrusive powers and members of Parliament—extended from today to the second sitting Tuesday in 2018.
The DEPUTY PRESIDENT (16:25): Does any senator wish to have the question put on any proposal? There being none, I shall now proceed to the discovery of formal business.
BILLS
Taxation Administration Amendment (Corporate Tax Entity Information) Bill 2017
First Reading
Senator GALLAGHER (Australian Capital Territory—Manager of Opposition Business in the Senate) (16:26): I move:
That the following bill be introduced: A Bill for an Act to amend the Taxation Administration Act 1953, and for related purposes.
Question agreed to.
Senator GALLAGHER: 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.
Second Reading
Senator GALLAGHER (Australian Capital Territory—Manager of Opposition Business in the Senate) (16:26): 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 GALLAGHER: I table an explanatory memorandum, and I seek leave to have the second reading speech incorporated in Hansard.
Leave granted.
The speech read as follows—
Today, Labor introduces the Taxation Administration Amendment (Corporate Tax Entity Information) Bill 2017. This Private Senators' Bill amends the Taxation Administration Act 1953.
Section 3C of the Act details the type of income and tax information the Commissioner of Taxation is required to make publicly available annually for corporate entities.
This Bill amends Section 3C(1) to align the threshold for private corporate entities with that of public corporate entities by lowering the threshold from $200 million to $100 million.
This restores the public reporting of corporate tax entity to its original intent as introduced by the former Labor Government in 2013 in the Tax Laws Amendment (2013 Measures No. 2) Bill 2013.
This Bill addresses a prominent deficiency in the tax transparency regime that arose after amendments were made to the Act in 2015, and brings approximately 600 large companies into the tax transparency regime.
Tax Transparency Information
In 2013, the Australian Government introduced and the Parliament passed the Tax Laws Amendment (2013 Measures No. 2) Bill 2013. Among the amendments, the Bill introduced Section 3C Reporting of information for corporate tax entities with reported total income of $100 million or more.
The measure was a significant advance in tax transparency that accompanied and complemented other significant reforms to close tax loopholes used by large companies.
Since then, two years of tax data on corporate tax entities has been publicly released, 2013-14 and 2014-15. It has facilitated constructive discussion about corporate taxation in Australia. Civil society and advocacy groups argue that tax transparency data is a vital tool for oversight, scrutiny, and policy debate.
Tax transparency improves behaviour. Large private companies know that they will be held to account for the amount of tax they pay and that will change behaviour.
As originally passed, Section 3C was a tax transparency measure that aligned the thresholds for public reporting of public and private corporate entities' basic tax and income information at $100 million.
Section 3C was amended in October 2015 to completely remove private companies from public reporting by the new government in the Tax and Superannuation Laws Amendment (Better Targeting the Income Tax Transparency Laws) Act 2015.
My colleague in the House of Representatives, the Shadow Assistant Treasurer, said at the time that the Coalition did so after "an astro-turf campaign, following really, what might have just have been an idea dreamed up after the second cherry in the Melbourne Club".
The Senate had begun the task of restoring the previous tax transparency laws.
However, in December 2015, section 3C was amended again to include private companies (as part of the debate Tax Laws Amendment (Combating Multinational Tax Avoidance) Bill 2015), however the threshold for reporting was set at $200 million.
No genuine policy rationale was given for either the removal of the public reporting requirement for public companies, nor the restoration of the requirement with a significantly higher threshold.
The $200 million threshold results in approximately 600 large private companies (about two-thirds of those affected by the original measure) not having high-level tax information scrutinised, unlike comparably sized public companies.
As noted in a Senate Economics Legislation Committee report Tax and Superannuation Laws Amendment (Better Targeting the Income Tax Transparency Laws) Bill 2015[provisions], the Australian Taxation Office "gave evidence during this inquiry that one in five private companies earning over $100 million do not pay any tax".
How did we get here? During the Senate debate about the Government's Tax Laws Amendment (Combating Multinational Tax Avoidance) Bill 2015, the Liberals and the Greens engaged in a backroom deal to let Australia's large private companies continue to avoid tax transparency.
The Coalition found a new partner in Senator Di Natalie's Australian Greens. The Labor Party stood firm, and the Labor Party held to its position to protect tax transparency. We took the pledge to restore the original threshold to the 2016 election. If the Government will not fix this, we will aim to from Opposition.
That is an important point. The Turnbull Government is shielding some of Australia's largest companies from scrutiny at the same time as handing banks and multinationals a $65 billion tax cut.
The Government is also tearing itself apart over an internal culture war. Labor is developing serious policy. Where we can, we will try and implement from Opposition, just as we have sought to do with the Competition and Consumer Amendment (Small Business Access to Justice) Bill 2017.
In a context where aggressive tax minimisation by large companies and high net worth individuals are under intense public scrutiny, this measure will restore the original public reporting threshold for large private companies.
Detail in the Bill
Schedule 1 of this Bill amends the Taxation Administration Act 1953 ('the Act'). Section 3C details the type of income and tax information the Commissioner of Taxation is required to make publicly available annually for corporate entities.
This Bill amends section 3C(1) to align the threshold for private corporate entities with that of public corporate entities by lowering the threshold from $200 million to $100 million.
This Bill would repeal the current wording of subsection 3C(1), and substitute it with language that ensures corporate tax entities (including private companies) with total income equal to or exceeding $100 million are subject to the public reporting requirements of section 3C.
The amendment made in Schedule 1 would apply to the 2017-18 income year onwards.
Labor is the party of tax transparency
This policy complements the suite of tax transparency measures Labor has announced and intends to implement should we form Government.
Labor's comprehensive measures will massively increase transparency on the use of tax havens by corporations and high net-worth individuals and add more civil society voices to official tax deliberations.
Tax havens threaten Australia's tax base. When tax revenue gets lost to tax havens, Australians ultimately have to pay higher taxes or suffer cuts to vital services. For example, the Cayman Islands have been criticised by the OECD and by tax commissioner Chris Jordan for their excessive secrecy. They have more companies than people. A single building in the Caymans – Ugland House – is home to over 18,000 companies.
As Tax Commissioner Chris Jordan recently said in a speech to the Tax Institute: 'Many of these [tax] matters involve deliberate tax evasion, often using overseas tax havens or complex corporate structures to avoid detection and recovery.'
The shockwaves from the Panama Papers and similar scandals involving corporations and high net-worth individuals aggressively minimising their tax are being felt around the world. Other governments have been jolted into action on transparency measures since the public outcry over the Panama Papers.
The Turnbull Government has done virtually nothing. With rising inequality and rising government debt, the time for acting on tax havens and tax transparency has come.
Labor proposes to introduce a series transparency measures that I will briefly outline.
Labor will introduce public reporting of country-by-country reports. High-level tax information about where and how much tax was paid by large corporations (over $1 billion in global revenue) will be released publicly.
Labor will introduce whistle-blower protection and incentive/rewards; to provide protection for whistleblowers who report on entities evading tax to the Australian Taxation Office. Individuals who highlight tax evasion would collect a share of the penalty collected.
Labor will introduce mandatory reporting of 'material tax risk' (tax haven exposure) to shareholders. Companies would be required to disclose to shareholders as a 'Material Tax Risk' if the company is doing business in an international material tax risk jurisdiction (i.e. a known or suspected tax haven). There is no current legal requirement to do so currently.
Labor will introduce public reporting of AUSTRAC data; that is, we would require AUSTRAC to publicly release International Funds Transfer Instructions (IFTI) data for every calendar year (or, if more practical, financial year).
Labor will introduce disclosure of 'material tax risk' for government tenders. We would amend Government procurement process requirements such that the Australian Government tender process requires all companies to state their country of domicile for tax purposes.
Labor will develop guidelines for tax haven investment by superannuation funds – task the ATO (in collaboration with ASIC, and APRA re: self-managed super funds) to create/review guidelines for responsible investment for superannuation funds.
Labor will introduce a publicly accessible registry of the beneficial ownership of Australian legal entities. We would fully implement the G20 principles Australia signed in 2014 and ensure transparency over how ultimately owns a company, rather than just who is listed on company paper-work.
Labor will introduce an ATO disclosure of settlements and reporting of aggressive tax minimisation; high-level reporting in the ATO's annual report on how many settlements were achieved per financial year and associated data.
This Bill, and the policies I've just mentioned, all build on Labor's proud policy legacy.
This Bill is the first step to restoring tax transparency to where the previous Labor Government left it. It is the foundation upon which we build our further measures.
Conclusion
I encourage all those who consider themselves friends of transparency to support this Bill and help us deliver one of the vital tools for public discussion about the integrity of our tax system.
Senator GALLAGHER: I seek leave to continue my remarks later.
Leave granted; debate adjourned.
MOTIONS
Housing Affordability
Senator SIEWERT (Western Australia—Australian Greens Whip) (16:27): I move:
That the Senate—
(a) notes the issues raised about retirement villages in the Four Corners report 'Bleed Them Dry Until They Die' on 26 June 2017;
(b) expresses concern about the issues raised in the report, including excessive fees, complex contracts and misleading advertising;
(c) acknowledges that such issues are not restricted to retirement villages;
(d) is aware that there was a parliamentary inquiry that looked at similar issues within the retirement village sector in 2007, and that the relevant recommendations have not been implemented;
(e) acknowledges retirement housing reform is on the agenda for the upcoming meeting of Consumer Affairs Ministers; and
(f) urges the Federal Government to take a leadership role in developing nationally-consistent regulation of retirement housing across the various tenures that provides strong protections to residents and their families.
Question agreed to.
COMMITTEES
Economics References Committee
Reference
Senator WHISH-WILSON (Tasmania) (16:28): I move:
That the following matter be referred to the Economics References Committee for inquiry and report by 29 November 2017:
The use of discretionary trusts in Australia, with particular reference to:
(a) the structure and purpose of discretionary trusts;
(b) the process of establishing discretionary trusts;
(c) the role and profile of trustees and beneficiaries across different personal and commercial sectors;
(d) the current taxation structure for discretionary trusts, including the extent of tax minimisation and avoidance;
(e) alternative taxation structures for discretionary trusts, including any tax minimisation and avoidance issues; and
(f) any other related matters.
Senator McGRATH (Queensland—Assistant Minister to the Prime Minister) (16:28): I seek leave to make a short statement.
The DEPUTY PRESIDENT: Leave is granted for one minute.
Senator McGRATH: The government does not support the motion. The coalition government knows that trusts are a legitimate structure providing asset protection and flexibility in cash flow. They are also commonly used in succession and estate planning. Labor's plan to impose a minimum 30 per cent tax on distributions by discretionary trusts is just another Labor tax grab on small businesses. The Leader of the Opposition, who once supported trusts, needs to explain why he's changed his mind and why Labor is exempting farm trusts but not those small businesses providing farmers with farm supplies such as fertiliser for crops or stockfeed for livestock. They also experience lumpy income. There is no rationale for this referral, which will only add strain to the existing workloads of Senate committees and the committee secretariats in particular.
Senator WHISH-WILSON (Tasmania) (16:29): I seek leave to make a short statement.
The DEPUTY PRESIDENT: Leave is granted for one minute.
Senator WHISH-WILSON: I moved this motion seeking to have this Senate inquiry because the Greens have campaigned for changes to taxation on discretionary trusts. We took to the last election a comprehensive policy, fully costed by the Parliamentary Budget Office, to tax distributions at a level that corporations are taxed at. We did a lot of work on this, and we feel this is a very important area. Saying that, I recognise the complexity involved in tax law around discretionary trusts. I recognise they do have legitimate purposes; however, we thought this was a really good opportunity to show how the system is being rorted. The PBO costed this at nearly $5 billion in revenue over the forward estimates that we could use for schools and hospitals if we cracked down on this, but we acknowledge we want to get it right. There may be unintended consequences from policy changes. We hope this will be implemented in a future government, but this is a really good opportunity for us to get the detail right.
Question negatived.
Finance and Public Administration References Committee
Reference
Senator PRATT (Western Australia) (16:30): I, and also on behalf of Senator Rice, move:
That arrangements relating to the collection of statistical information on the views of all Australians on the electoral roll on whether or not the law should be changed to allow same-sex couples to marry, as announced by the Government (the postal survey), be referred to the Finance and Public Administration References Committee for inquiry and report by the second sitting Tuesday in February 2018, with particular reference to:
(a) what information will be collected and how it will be collected, aggregated and reported;
(b) what departments and agencies will be involved and what resources will be provided;
(c) the legislative basis for the collection and how matters such as advertising, fraud, access to the roll and privacy will be regulated;
(d) the integrity of the roll and the potential for disenfranchisement of voters;
(e) protections against offensive, misleading or intimidating material or behaviour, especially towards affected communities;
(f) how issues incurred during the collection will be addressed;
(g) whether the information will be stored and what controls on future access will apply;
(h) all aspects of the conduct of the collection and related matters; and
(i) proposals for use of the information obtained, including to inform future legislation.
Question agreed to.
MATTERS OF PUBLIC IMPORTANCE
Australia
The DEPUTY PRESIDENT (16:31): I inform the Senate that, at 8:30 am today, six proposals were received in accordance with standing order 75. The question of which proposal would be submitted to the Senate was determined by lot. As a result, I inform the Senate that the following letter has been received from Senator Wong:
Pursuant to standing order 75, I propose that the following matter of public importance be submitted to the Senate for discussion:
The need for a new vision for a stronger and fairer Australia, which focusses on secure jobs and fairer wages, tackles rising power prices, invests in education and health care, and addresses housing affordability.
Is the proposal supported?
More than the number of senators required by the standing orders having risen in their places—
The DEPUTY PRESIDENT: I understand that informal arrangements have been made to allocate specifics times to each of the speakers in today's debate. With the concurrence of the Senate, I shall ask the clerks to set the clock accordingly.
Senator POLLEY (Tasmania) (16:32): Unlike those opposite, Labor understand that we have to make Australia more equal again and that we have to start by putting forward a good plan and good policies for the future. Despite what those opposite have been claiming, inequality is getting worse in this country. Under this lacklustre Liberal government, more and more people are finding it harder to put dinner on the table each night and it's becoming impossible for people to find secure work. People are getting sicker because they're skipping seeing the doctor because they just can't afford it. People are struggling to access quality education from primary school through to higher education. Households are being absolutely crippled by the rising living costs in this country, and home the ownership rate is now at a six-decade low.
I was shocked and appalled by comments from those opposite, who came out banging their drums saying that inequality had actually gotten better under this government. What a joke! That just shows how out of touch they really are. The facts have been laid bare: inequality is on the rise; Australians are struggling on all fronts. Something has to stop. This government needs to stop this. We need to see this reversed. What the Liberals are doing isn't working. Instead of denying the hardship that everyday people are facing, the least that those opposite could do was to pretend they had a plan to deal with it. But this government is bereft of any vision or any plan to reverse the inequality in this country. At a time where wages have flatlined and bills are going through the roof, the government's only plan is to cut payments to pensioners and support cuts to wages while giving tax cuts to millionaires and the biggest businesses. Why should the top end pay less and the rest of Australia pay more? When will the Turnbull government see sense and for once back the battlers over the billionaires? An economy that only benefits the Prime Minister's mates isn't just unfair, it's likely to be unstable, too. If those opposite spent half the time developing a vision and policies to benefit every Australian that they do talking about Labor and making things up, then Australia would be a better place to live.
Mr Malcolm Turnbull is under enormous leadership pressure. He needs to tell us he's a strong leader, like he did last week. If you really are a strong leader, Mr Turnbull, you shouldn't need to tell us, but it's probably more about telling yourself. If the Prime Minister were really that strong, he would have asked his Deputy Prime Minister to step aside until the High Court makes its ruling. Mr Turnbull, if you were as strong as you are telling us you are, you would be fighting as hard for all Australians to have secure jobs as you are fighting to save Mr Barnaby Joyce's job and your own. Instead of wasting your breath telling us what a strong leader you are, perhaps you could get to work and tell us what you're going to do to create a stronger and a fairer Australia.
The people who elected the Prime Minister to represent them and to have a vision, a plan and policies going forward are in fact looking to Mr Bill Shorten, the leader of the Labor Party, because we're the party of ideas, we're the party of policies and we're the party of vision and we're about ensuring that there is a change in the inequality in this country. But we have a Prime Minister whose only mantra is to give the top end of town a tax cut, to support big business, while at the same time cutting supplements to pensioners. We have an underemployment problem in this country that this government is failing to address.
This is a Prime Minister who is so out of touch, who is so arrogant and who is a leader of a dysfunctional and chaotic government, and that's going to be what is going to be written about this Prime Minister in the pages of history, because he lacks leadership. (Time expired)
Senator IAN MACDONALD (Queensland) (16:37): I'm not sure that I'm in the right debate. I read that the debate is about secure jobs and fairer wages, tackling rising power prices and investing in education and health, and that's a great description of the Turnbull Liberal-National government. It is a government which is focused on secure jobs and fairer wages, that tackles power prices, that invests in education and health and that is addressing housing affordability. So I wonder if I'm in the right debate. I also just heard the previous speaker, Senator Polley, who seemed to spend all of her time talking about Mr Turnbull. I just ask Senator Polley whether she might have a look at the latest opinion polls. Mr Turnbull's rating continues to rise whereas that of her leader, Mr Shorten, continues to fall. When we find that Mr Shorten, who, when head of the AWU, used $100,000 of AWU members' money to give to the Labor Party, you can understand why Mr Shorten's polls continue to fall. I think it won't be too long before Mr Albanese and—I see Senator Cameron here—the Sydney cohort of the ALP will be looking, sharpening the knives to get rid of Mr Shorten and put in Mr Albanese. I hope they don't because—not that I have a great regard for any leader of the ALP—I do think that Mr Albanese would be a far better leader for the ALP and would perhaps provide better competition for Mr Turnbull at the next election. As I say, the opinion polls show Mr Turnbull to be so far ahead as a leader that it's not even a comparison at the present time.
So what Senator Polley was doing, talking about Mr Turnbull and lack of leadership, I can't quite understand. She really should, if I might say through you, Mr Acting Deputy President Ketter, have a look at Mr Shorten, the guy, as I said, who used $100,000 of members' money to donate to a political party. He's also the guy that used to knock around with the captains of Australian industry, the very wealthy ones, and got their private plane to slip down to Tasmania at the time of what was to be a tragedy. He had left, he saw that it wasn't a tragedy and that there was good news there. He hired a magnate's plane—not hired it; got it for free—and slipped down in time for the early morning television. No wonder Mr Shorten's polls are going down. I think the Australian public are waking up very, very quickly to Mr Shorten, and well they should.
We know Mr Shorten gave that money out as a union leader. That's another reason why membership of the unions in the private sector has fallen to 10 per cent of the total private sector workforce. That means 90 per cent of workers in the private sector choose not to join a union. And yet it's the union that controls the Labor Party and directs what could be the alternative government of Australia. But I digress, because Senator Polley spent most of her speech talking about Mr Shorten and Mr Turnbull.
Can I just say that in the coalition ranks we are very, very concerned for jobs. I'm pleased to say—and credit where credit is due—that half of the Labor Party in Queensland—the faction led by the Premier, Ms Palaszczuk—understands the importance of coalmining in the Galilee Basin and of the jobs that will be created. There were $38 billion in royalties and taxes paid between 2007 and 2013-14, and a recent study showed that the Queensland coal industry contributed $23.7 billion in 2015-16 to the Queensland economy and supported 180,000 jobs. And yet the great workers' party, the union party, continues to denigrate the Adani proposal.
Just last Friday at the Senate committee hearing, we had Labor Party politicians raising all of the reasons why that coalmine and that new infrastructure should not go ahead. And I certainly hope that the North Australian Infrastructure Facility will help jobs in Central and North Queensland by providing some money for common user infrastructure. Not for coalmines—I understand those are fully funded by the particular proponents, whoever they might be. But NAIF, set up by the Turnbull government, is there for common user infrastructure, to provide a bit of assistance from the Commonwealth taxpayer as a loan—I emphasise that—to be repaid where there is a gap in the funding.
And we do that supported by the Palaszczuk section of the Labor Party in Queensland by helping out with Adani. For as much as Palaszczuk and the total 100 per cent of the Liberal National Party support these job creation activities, there are people within the Trad section of the Queensland Labor Party and many down here that we hear of at Senate committee hearings and elsewhere who want to do everything possible to undermine that job creation project for Central and North Queensland and that money-making project for the Queensland government and the Queensland economy generally.
This motion by Senator Wong talks about jobs and fairer wages. Fairer wages and all wages, including penalty rates in this country, are by legislation dealt with not by the parliament, not by the government but by the independent Fair Work Commission set up by Bill Shorten and the Labor Party. Its members comprise many, many union heads of times gone by. We believe in fairer wages and fairer conditions, and that's why we let the independent umpire, set up by Labor, deal with that job.
The Turnbull government is the only federal government in the political history of Australia that's taken any steps to deal with rising power prices. Rising power prices are matters for state governments. In Queensland, of course, the state government gouges the profits and puts up the prices, so they can get more money, because they own the generators, and the profits they make go in to prop up a pretty awful state budget. But the federal government—they are state government issues—is the first one in history to take a national approach to reducing power prices, and we're doing it. Senator Carr whinges at question time, but when he was the minister for industry for six years, what happened? Absolutely nothing—not a thing. It takes a coalition government to deal with that.
Time prevents me from talking about the massive new investment in education. And just today I've got some updated figures of how much more every school in the state of Queensland will get as a result of the Turnbull government's recently announced education initiative. This is more money for every school. I've written to every school. They've acknowledged how grateful they are for the additional funding coming through as a result of this government's activities. So I thank Senator Wong for raising this for discussion today. I'm surprised it was her that raised it, not us, because it's all about what the Turnbull government is doing.
Senator XENOPHON (South Australia) (16:46): In the very limited time available, I want to speak to this motion. Of course, we need a stronger and fairer Australia. It needs to be centred on secure jobs, but we need to have those jobs in the first place—well-paying jobs. There is great news coming out of South Australia today that the South Australian government has secured an arrangement with SolarReserve to build the $650 million solar thermal power plant at Port Augusta—something I negotiated with the federal government, and in particular Senator Cormann, to ensure the $110 million concession equity loan was in place for that, and that is a key pillar. I acknowledge Sam Johnson, the mayor of Port Augusta, who's in Canberra today, where he acknowledged the importance of that concessional loan to make sure the project can get off the ground—to underpin it. That's 4,000 jobs in regional South Australia, direct and indirect, that will come about as a result of this groundbreaking project.
The key to having jobs is to make sure that energy prices come down—whether it's in gas or electricity overall. We are facing an existential crisis in this country because gas prices are simply too high. Unless we deal with those gas prices, unless we have policies to tackle it head on, you can expect to see tens of thousands of jobs leave our shores in the coming months and years, and that's something we can't afford as a nation. Some of the measures by the federal government seem to be having a downward pressure on gas prices—things I negotiated with my colleagues in making the gas market more transparent in the first place.
But we need to go further. We need to tackle the decline in manufacturing. Six per cent of Australia's economy or GDP is based on manufacturing, compared to 12 per cent a decade ago. That is a shocking figure. I know that Senator Carr and others who have been champions of manufacturing in this country would be very alarmed at that. Contrast that with Germany, where 22 per cent of their GDP is based on manufacturing. Why? Because governments, private industry and unions work together in a collaborative way to build manufacturing. They have the Fraunhofer Institute, which has been a great success in getting synergy between industry, unions, the university sector and government to drive those good outcomes in manufacturing.
We need a procurement policy that must be implemented. Those changes at the end of last year were significant changes. They could be better, but they are significant changes. We need to tackle dumping laws and to be tougher on free trade agreements; we need to invest in education, trades and skills. When it comes to health, for goodness sake let's put an emphasis on preventive health so we can prevent people going to hospital in the first place. There are so many other issues to traverse, but I hope this gives a flavour of what the Nick Xenophon Team stands for.
Senator CAMERON (New South Wales) (16:49): I rise to support the proposition that has been put forward by the leader of Labor in the Senate, Penny Wong. Labor is absolutely committed to building a better society and to building a better community in this country. We do want secure jobs, and that's why we have said that you need to resolve the issue of climate change so that we can get investment in this country into renewable energy and create jobs for these young kids that are listening to this debate today, because that's the issue. We don't go back to coal. We don't go back to the era where coal drove everything in Australia. We need the opportunity to bring this country into the 21st century.
We do need fairer wages in this country. Under this rabble of a government that we have, under that weak Prime Minister, Malcolm Turnbull, we've seen wage stagnation to the extent that the Reserve Bank is saying that we need some process to lift wages in this country. And what was the first thing this government did? It actually cut the wages of the parliamentary cleaners, the people that clean the toilets after this rabble of a government. They had their wages cut under this government.
We want to make sure that we tackle rising power prices, but you need certainty. You need investment. You need new investments in this country to deal with that. We want to invest in education. Seventeen billion dollars is what you lot have cut from the Gonski agreements around the country. We want to make sure that there is not only a school system that we can be proud of but a TAFE system that we can be proud of. And what we see around the country is the National Party standing back, watching austerity budgets cut back on TAFE around the country. We want more apprentices. We want more opportunities for young people and we want opportunities for older people in regional and rural communities to access TAFE. These are the issues that we see as important.
We want more health care. We want better health care. We want a focus on health care. We don't need more $7 fees added to people who are going to see the doctor, as this lot did in their first budget. We want to deal with housing affordability. We want these young people that are here listening in today to be able to afford their home in the future. But, while this mob defend capital gains tax exemptions and negative gearing for their rich mates who put their money in their back pockets for their election campaigns, we are always going to have a problem with capital gains tax exemptions, negative gearing and the use of self-managed super funds to push young people out of housing affordability in this country. We will deal with that.
I want to finish on this issue. The coalition are obsessed by the Leader of the Labor Party, Bill Shorten, and I know why: because it's the 16th or 17th poll—they raised the issue of the polls—that we've seen the coalition way behind Labor in the polls. And then you get Senator Macdonald come up here, again with that obsession, and talk about Beaconsfield. He has not got a clue, obviously from what he said, about Beaconsfield and Bill Shorten's involvement there. He hasn't got a clue what happened. He should come here and apologise to the people of Tasmania, who watched one of their fellows down there die at Beaconsfield, trapped in a mine, dead. And we had this nonsense from Senator Macdonald. We had miner Larry Knight dead at 44 years old, and we get that nonsense from Senator Macdonald. We had Brant Webb and Todd Russell trapped, and the public knew that Bill Shorten was down there supporting those workers and those families—more than this mob would ever do for a worker in their lives. You're a rabble of a government and an absolute disgrace.
Senator O'SULLIVAN (Queensland) (16:54): I want to thank Senator Wong for the opportunity to make a contribution on issues such as secure jobs, rising power prices, investment in education and health care, and addressing housing affordability. I think it is fair to say that most people who have a basic understanding of economic principles understand that most of the generation of wealth in a nation happens from the private sector. We know that the public sector, governments, can borrow more money, and my colleagues on the other side of the chamber know all about that; cut services, and nobody in this country wants to see an unnecessary reduction in services; or we can increase the receipts of the nation by higher taxes and charges. Of course, it is two out of three for my colleagues in the Labor Party and the Greens, who support those anti-economic measures in terms of their management of the economy. It's well known that whilst the Labor Party, historically, has made great contributions to this nation over many decades, it cannot manage an economy. It mismanages every economic opportunity that it has. It's also well known that it has no interest in rural, what I refer to as provincial, Australia.
This government, the Turnbull-Joyce government, has created some 240,000 new jobs—a quarter of a billion new jobs—since it come to power. I don't know how many more jobs the Labor Party think there are to be had, but this is an outstanding record. As you all know, when people have the dignity of a job, it creates a much fairer Australia. The missions we've created with reductions in taxation create opportunities for private sector businesses to go ahead and employ more people and give people the dignity of employment. It creates these opportunities. Investment creates opportunities, and opportunities come in the form of jobs, which see a reduction in the impacts on the social security net in our nation. It gives us improved living standards, and Australians, generally—not all; I don't think it matters at what stage in life we look, there are some people who find themselves left behind—have first-class living standards and education compared to anywhere in the world and have some of the best health care in the world. When you get people into jobs, all of this impacts on the economy and, amongst other things, results in a reduction in the cost of social security and an increase in receipts for the Commonwealth. And what does the Commonwealth do when it is in good economic circumstances? It invests that money, mainly in infrastructure projects and the provision of services for the nation. That is regarded as an investment in those economies. That turns to creating opportunities and jobs and in the wonderful economic cycle, the circle joins and goes on forever.
I find it difficult that the Labor Party would talk about creating a stronger and fairer Australia when their current tax policy is to increase taxes. This is a well known 101 of economics. Increasing taxes simply stifles investment. It reduces investment, and, therefore, these opportunities that I spoke of, these jobs that are created, don't appear. In fact, jobs are lost.
Let's just link that to what they're talking about: to tackle rising power prices. It is well known that the Labor Party—it almost defied logic for me as I watched them over the last decade—abandoned blue-collar workers in provincial Australia and particularly those who were involved in our coal industry up in central Queensland. There were 14,000 jobs gone. There were 14,000 real jobs gone in Central Queensland between Townsville and Gladstone. The Turnbull-Joyce government has compensated with the creation of 240,000 new jobs, but, nonetheless, 14,000 jobs are gone.
Let's talk about how the Labor Party might support us in dealing with this. It's no surprise that my speech concentrates on Queensland, my home state, and on projects that will lift the economic fortunes of all the people in Central Queensland. We've got the Adani Carmichael project, with 2½ thousand direct jobs and nearly 4,000 indirect jobs once that goes into operation. We're talking about a total employment impact of 11,800 jobs when the secondary jobs are taken into account—those businesses and industries that will support the development of the Carmichael project. With GVK there are almost 3½ thousand jobs in construction, along with 3,200 when it's in operation. We haven't even touched on some of the ancillary stuff that happens here. We haven't even touched on the $1 billion rail line that has to be built and the increase in the port facilities in Central Queensland.
I have invited colleagues from across the chamber more than once—to save having to do it every time I speak, the invitation stands open—to make contact with my office. I'm happy to meet the costs of travel. We'll go up into Central Queensland, into the public bar of the Black Nugget Hotel, into the town square at Blackwater or into the main street of Emerald and you can meet the people who will be directly affected by your policies that you continue to espouse. You can meet these people. You can meet the small-to-medium-sized businesses for whom you resisted a tax cut that would provide them with some surplus that they—most of them at least—would inevitably reinvest in employment opportunities. Going back to my cycle: employment creates opportunities, increases the receipts of the nation, puts the Commonwealth in the stronger economic position and allows us to invest in projects like the development of northern Australia, a $5 billion fund.
I cannot believe that Senator Wong selected some of these issues for the debate under standing order 75 today. She forgot to mention or wasn't aware of the $2 billion dams package that will be invested in infrastructure in so many of our states. She forgot about the $1.7 billion invested in the Toowoomba Second Range Crossing to get our commodities from provincial Australia, particularly the central west and the south-west of my home state. There is $1.5 billion already invested in the Inland Rail, with a further $9 billion committed to be invested in that project. There is $10 billion invested in upgrading the Bruce Highway to make it flood-proof. There are all those commodities in the north. Hundreds of thousands of people are employed in the banana industry and the sugarcane industry, and they can all have secure jobs, knowing their commodities can make their way down to port.
I want to finish where I opened. The Australian Labor Party has a long tradition of poor economic management. It's reflected in their policies today and the fact that these policies will impact on rural Australia. Thank you for the opportunity to speak.
Senator ROBERTS (Queensland) (17:03): As a servant to the people of Queensland and Australia, I am astounded by the words of Labor's MPI which, at its core, is about cost of living. In November 2009, the then ALP Senator Mark Furner and I exchanged correspondence. He relied on written advice from Senator Wong. Her comments falsely blamed carbon dioxide from human activity for natural climate cycles and weather. On these Labor-Greens misrepresentations of climate are based Labor energy policy, killing jobs and raising cost of living.
Today the Leader of the Opposition in the Senate, Senator Wong, a South Australian, continues to severely hurt Australia's strength as her party destroys fairness, kills job security and turbocharges energy price rises, closing factories and shutting mines and businesses. Instead, a stronger and fairer Australia will come from policies based objectively and honestly on hard, measured data—scientific data—physical observation and empirical evidence. This is all we ask for in economic policy. Such evidence, according to NASA satellites, shows that atmospheric temperatures have shown a flat trend for the last 22 years despite record amounts of carbon dioxide from human activity—no warming. The Global Historical Climatology Network's records show that the longest temperature trend of the last 120 years was 40 years of cooling, from the 1930s to 1976, when carbon dioxide from human activity increased dramatically during World War II and the postwar economic boom. Bureau of Meteorology data show that Australian temperatures in the 1880s and 1890s were warmer than today.
The way to a new vision for a stronger and fairer Australia, secure jobs, fairer wages and reducing energy prices is to eliminate the anti-science and destructive climate policies initiated by the then Leader of the Opposition, Kevin Rudd, in 2007 and meekly adopted and promoted by then Prime Minister, John Howard, fearfully trailing in the polls and media. The ALP-Greens climate fraud has much to answer for. And the antidote is easy: tell the truth and restore scientific integrity. Pauline Hanson's One Nation Party stands for fairness and integrity, a fair go for all Australians together. A vision for a stronger and fairer Australia with secure jobs and fairer wages must be based not on which way the wind blows but on solid facts, hard evidence.
Senator BILYK (Tasmania) (17:06): Unfortunately, we do have a need for a new vision for a stronger and fairer Australia. And that's because this government has not got the ability to lead our nation. There is no leadership. Added to that, they fundamentally lack vision and a sense of what is fair. It's as if they're stuck in a time warp. They espouse policies from the 1950s without realising that the world has actually moved on, that the world has changed. And the policies the Australian government enacts for the Australian people need to change, too; they need to keep up-to-date.
Labor, on the other hand, has a vision for a stronger and fairer nation. Only Labor will fight for secure jobs and fair wages. Only Labor will tackle rising power prices, invest in education and health and address housing affordability. And why is that? It's because those opposite lack the courage, willingness or ability to fight for a better Australia. They're content to keep on eroding workers' rights and conditions because it suits them and their big-business mates. But we on this side believe Australia will be a stronger nation when we are a fairer nation, when everyone believes that they have opportunities, when everyone has potential to succeed and when loopholes in the law aren't used by some to not pay their fair share.
Sadly, fairness has gone backwards. Since the mid-1970s, real wages have grown by 72 per cent for the top 10 per cent of workers but by just 23 per cent for the bottom 10 per cent. If I was still an early childhood educator, or a cleaner, and had received the same wage gains as financiers and solicitors, then I would be about $16,000 better off a year. Unfortunately, early childhood educators and cleaners do not receive the same wage gains as financiers and solicitors, so they're not $16,000 better off a year. We know rising inequality has direct costs. And in an economy that benefits only the fortunate few it isn't just unfair; it's likely to be quite unstable and even unhappy.
The rules shouldn't be rigged for one group of people over another. Labor wants to see changes in a number of areas. One of those areas is discretionary trusts, which are overwhelmingly held by the most affluent households. Taxing discretionary trust distributions to mature-age beneficiaries at 30 per cent is a similar approach to what John Howard did as Treasurer in 1980 when he stopped the rort of distributing tax-free trust income to toddlers. Charitable trusts, deceased estates and people who work in or run a small business and receive a salary won't be affected. But high-income professionals who are splitting their income with their adult children and parents will have to go back to just one tax-free threshold, just like the rest of the workforce. That is fairness.
While the Turnbull government has led cuts to penalty rates and let them sail through, Labor will continue to fight these cuts. It's just unfair to cut the wages of our lowest income earners while millionaires get tax cuts. We've also seen the rise of the casualisation of work. Casual work makes it harder for people to get loans or mortgages, to plan their future and to maximise their career opportunities. The priorities of federal Labor start with jobs and wages and tackling inequality in the labour market, and the best way to secure jobs is to ensure we have a well-educated and trained workforce. So, while Labor stood its ground and campaigned against Gonski 2.0, it is a bit unfortunate that we saw the Greens capitulate and allow approximately $68 million to be ripped out of the education system of my home state of Tasmania. Unless we focus on quality education based on need, we will leave behind a generation ill-equipped to face the challenges of the future economy.
I'll just quickly talk about Australia's homeownership rate, which is now at a six-decade low. Over the past generation, the share of young Australians owning their home has fallen while the share who are renting has risen. As major city house prices push the seven-figure mark, we increasingly risk becoming a nation where the only way of buying a home is to get help from your parents. That's okay if your parents can afford it. I had to help my daughter recently to purchase a home. I earn good money, but if you're earning $60,000 or $70,000 a year, or even less, how do you help your adult child buy a home? Let me tell you: it cannot be done. My daughter wasn't eligible to get a mortgage, because she's on contract work all the time. Although she has an honours degree, she was— (Time expired)
Senator HUME (Victoria) (17:12): I rise today to speak in response to the matter of public importance submitted to the Senate by our parliamentary colleague from South Australian, Senator Wong. Although I applaud the spirit of Senator Wong in raising this matter of public importance in this place, I am frankly galled by the political nonsense inherent in the senator's insinuation that the Labor Party somehow has a superior vision for Australia's future. In this matter of public importance, Senator Wong blindly echoes the cheap populism and desperate rhetoric of her disingenuous leader. Indeed, the Leader of the Opposition, with his cheap and easy calls for fairness and equality, under which hide a dangerous redistributionist agenda, clearly believes he has found a path through his lack of personal appeal to voters and is desperately channelling the populist exploitations of the UK's Jeremy Corbyn. If you'll excuse the pun on such a serious matter, Bill Shorten is clearly remaking himself as a Corbyn copy of his UK socialist hero. Do you like that?
Let me remind the chamber of the Turnbull government's approach to a fairer and better Australia. Three months ago, the Treasurer delivered his budget in the other place. It was a budget firmly centred entirely on the notions of fairness, opportunity and security. Indeed, those on this side of the chamber are the staunch defenders of these notions, including fairness, but not of a populist, lowest-common-denominator, divisive definition of fairness. It is not a 'chapter 1, page 1 of the socialist playbook of the politics of envy' definition of fairness, nor is it a 'when all else fails, engage in class warfare' definition of fairness, conjuring a Monopoly-man-esque image of the rich Australian using trusts to legally avoid his fair dues of tax. The coalition's view of fairness is an inclusive one. It is a fairness that unites the nation in common purpose and does not divide it for political purpose.
The idea of fairness perpetuated by Labor and the Greens is a very, very narrow construct about distribution from those who have to those who have less. It doesn't take into account the innovation, the risks and the sacrifices taken by small business people that enable them to build a business and employ others. Fairness should also involve rewarding them for their risks, their sacrifices and their sleepless nights in order to create something of value. Government must never lose sight of the risks taken by industrious men and women in this country nor seek to punish their success.
I take, for example, the attack by those opposite on family trusts. Discretionary trusts, as we all know, are not tax avoidance structures. They can be, and often are, used by farmers and by small businesses to aid in things like succession planning and asset protection. And that the Labor Party would dismiss trusts simply as a crude tool of the tax-avoiding rich is an insult—an insult to the multitude of small businesses and agricultural trusts in Australia. It's an insult to small business people and it's an insult to farmers.
This is just the latest hit to small business from a Labor Party that doesn't understand that Australian small businesses drive Australian jobs and wages. Following their refusal to keep the lower company tax rate that the Turnbull government has legislated for small businesses, this is a party that simply doesn't care about small business. I know that those opposite might like to think that in the catchcry 'fairness' they have found a phrase that will 'Cry "Havoc!" and let slip the dogs of war'. But, in my mind, I feel that they have actually unleashed a poodle as opposed to a pit bull here.
The Australian public are not fools; they know that higher taxes are not the answer. Higher taxes will not solve the problems for those that have been left behind. As the Treasurer so plainly and so clearly put it: higher taxes don't increase your wage. Higher taxes don't increase your wage—that is a flat-earth argument that will penalise Australian families and whack small businesses. Indeed, the Parliamentary Budget Office has released the costings of Australia's new taxation plan, and it will be no surprise to hear that they estimated a cost to the economy in excess of $167 million. Now, how Senator Wong, the Leader of the Opposition or indeed anybody on that side of the chamber in Labor's parliamentary caucus could see this as good tax policy—as fair tax policy—is totally beyond me. It truly is a mystery.
Acting Deputy President, you will hear those opposite, those whose hopes are desperately pinned upon some improvement in the Leader of the Opposition's personal popularity, repeat the mantra of inequality and fairness like a broken record. But, as the Leader of the Opposition himself said in his budget reply speech, repetition is no substitute for conviction. For our country's sake, for our children's sake, we cannot allow Labor's creeping redistributionist agenda to come to pass. This is not a new vision; it has never been a new vision. It is the oldest play in the ALP's little red book. It is a socialist wolf in Labor's sheep's clothing.
So, I thank Senator Wong. I thank her very much for bringing this matter to the attention of the chamber. But I feel confident in dismissing this matter of public importance as simply the politically motivated nonsense that it is. And I thank the chamber for its time.
Senator LAMBIE (Tasmania) (17:18): The Australia I grew up in is in the rear-view mirror. When I was a child, I was told that if I did the right thing by others, if I kept myself out of trouble and if I worked hard, I would be successful. Today, that promise isn't true anymore. We still think the key to improving your lot in life is hard work, but that's increasingly not the case. The link between work and reward is being eroded.
Compared to the Australia of the previous generation, today we're still working hard but we're a nation working for lower wages with less job security. The generation who grew up being told that the way you moved up in the world was with education and training is now in charge of this place, and is making policy saying that students should pay more and that universities should get less. House prices are growing faster than income and trying to save up a deposit for a first home is like chasing a piece of string on the ground that keeps getting further away from you every time you go to grab it. Median house prices grew four per cent in Launceston last year and they grew eight per cent in Hobart. Meanwhile, incomes are going nowhere and there's still a big problem with unemployment and underemployment. Young people are being told to work hard and save for their first home, but they don't have the jobs to get their foot in the door and they are getting no help from this government. Of course, the Turnbull government thinks it's helping by giving young people an internship that pays them nothing and offers them no guarantee of employment at the end.
Where has the big picture thinking gone? We have a government that says, 'If you want to study then you should pay more to do it and, if a university wants to teach you, it should have to pay more to do that too.' We have a government saying that there is not enough money to increase Youth Allowance payments for students. The result is that students can't afford to spend their weekends studying because they're spending their time making coffees or waiting tables, because they need to be able to feed themselves somehow. Then the government looks at the money those students are making on the weekends and they say: 'You're making too much money. We'll have to cut some of that too.' Where does this all end? Where is the logic? Are these students working too much or not enough? Every hour they spend working in a pub or in a supermarket is an hour they're not spending on their study. We wonder how we're going to get people to finish their degrees. Well, here's a thought: why don't we give students enough time to actually study in the first place?
The Greens put forward a bill this morning that would have increased Youth Allowance by $110 a fortnight. The effect would have been to give students a little bit of breathing room. It would have meant that missing a shift because you're sick or studying wouldn't mean starving for a week. It would have meant more students doing more study, which is what we're supposed to be encouraging, which is supposed to be the purpose of the Youth Allowance payments in the first place. The bill was voted down by the champions of equality and opportunity in the Australian Labor Party. You'd expect it from the government but it's particularly shocking from the Australian Labor Party.
What's worse is that it wasn't just students who would have benefited from the increase; those on Newstart would have been better off too. But, instead of backing an increase for those who can't find a job, they backed a review instead. Another review won't change the fact that there are more unemployed people than there are job vacancies. It's simple arithmetic. If there are more people looking for a job than there are jobs, then not everyone will find one—it's pretty simple. Rather than punishing those who can't get a job, not because they don't want one but because there aren't enough jobs, we should be looking at the other side of the equation. We should be doing more to create jobs that will employ those people looking for work.
Looking after the vulnerable means actually looking after the vulnerable. It isn't a promise to say the right thing; it means actually doing the right thing. Let's be real. Pensioners aren't asking for the world. They aren't asking for a mansion, a jet ski and an investment property on the beach. Pensioners are simply asking for an age pension that gives them enough to turn on the heater in the morning. That's what they are asking for. Is it too much to ask? This government spends all its time fighting itself. What do we do to get a government that fights for the rest of us? Well, do you know what? I'll tell you who else is struggling: there are job seekers, there are students, there are veterans and there are small businesses. I can tell you they're in trouble. (Time expired).
Senator SINGH (Tasmania) (17:23): I rise to repeat this simple, self-evident truth. The Turnbull government will not bother itself to tackle the ever-extending list of cost-of-living challenges its leadership has forced upon all Australians. As Bill Shorten said last month: 'Workers' share of income is at its lowest levels in half a century'. There is less money in their pay packet and less security in their job. More and more Australians are part time or casualised and are denied a proper income that they could live on. They are able to be dismissed, put off or have their contract varied at any time.
Our out-of-pocket childcare costs have risen every year under the Abbott-Turnbull government. Despite their childcare changes, the government's own figures show fees are set to keep rising at over five per cent a year—well above wages. But the Turnbull government doesn't care about addressing inequality. It has no plans and no interest in addressing people's life circumstances, not because it can't, but because it won't. Helping Australians with cost-of-living challenges is simply not in this government's DNA. This is the party that has spent nearly half a decade talking up tax cuts for millionaires and multinationals, while, at the same time, applauding tax cuts to wages and implementing cuts to basic services. They haven't advanced climate policy or energy policy and the problems of housing affordability and negative gearing are untouched. Multinationals still do not have to pay their fair share of tax. There's an income tax cut for the top bracket and penalty rate cuts for the lowest tax bracket.
However, there's another truth in this parliament and it is the truth about the Labor Party. The Labor Party works for a fair and more equal society. It is the truth about us that we always have and we always will. There is only one party interested in improving the lives of all Australians: it is the Labor Party. The Labor Party is prepared not only to recognise inequality as the most serious threat to our health as an economy and our cohesion as a society but to set out and take the necessary steps that will actually address it.
As Bill Shorten has said, Labor will tackle inequality and restore the confidence so desperately needed in our economy. Labor will work with business to drive the industries that deliver decent jobs that people can build a life around and gain a mortgage around and so that they can form meaningful relationships and have dreams and hopes for their future and their children's future. Labor will have the courage to end the toxic politics created by this government on climate and energy policy, which will create the certainty needed to boost investment and drive down energy costs. Labor will put the great Australian dream of owning your own home back within the reach of working and middle-class Australians. Labor will invest in Medicare, in dental care and in our healthcare system, so that Australians are healthier at home and, of course, more productive at work. We will do what this government refuses to do.
This government continues to ignore the issues and the challenges facing Australians, to ignore the facts of inequality. In fact, Senator Cormann doesn't even think that there is an inequality problem. He actually thinks inequality is getting better, despite what the Governor of the Reserve Bank claims to admit. Well, the Labor Party knows very well that as long as the Turnbull government continues to govern for the people of Australia, inequality will worsen and Australians will be the worse off.
Labor will do what this government has refused to do, because we will always stand on the side of fairness and we will always stand on the side of decency for all Australians. We will reward hard work. We will invest in the future and ensure that Australia, once again, does indeed become the country of the fair go.
Senator CHISHOLM (Queensland) (17:27): What we have seen from those opposite in this debate is the fact that we do need a new vision for this country, because what we've seen is a really motley crew of an excuse for what they tried to elaborate as their vision for this government. But the reality is we have seen no vision from them. All we have seen is slogans that mean nothing and deliver less for the Australian people. There has been no better example of that in recent days and weeks than the Treasurer, Scott Morrison, lecturing us that inequality has actually been getting better in recent years, proving not only how out of touch he is but also, at the same time, his lack of political acumen. In this chamber, we get lectures about socialism from the finance minister—the guy who's best known for smoking a cigar just prior to delivering the worst budget in living memory. Now what we see is a $122 million survey that will be his legacy as finance minister. So there is no doubt that there needs to be a new vision.
The comments and contributions from Senator Macdonald and Senator O'Sullivan need to be touched on as well. They came in here and mentioned the importance of coal in regional Queensland. As a Queenslander, I am someone who understands that. But they obviously missed the memo from Scott Morrison, who said that cheap coal-fired power is dead. They obviously failed to pick up that from his contribution.
But why do we need a new vision? I think it's important to highlight just some of the reasons why that is necessary when you look at the record of this government. We know about the comments from Treasurer Morrison around inequality. However, since the mid-1970s, real wages have grown by 72 per cent for the top tenth of workers but just 23 per cent for the bottom tenth. For all their talk about jobs and growth, the key parameters in this year's budget have actually been downgraded. Growth is down, wages growth is down, employment is down and the unemployment rate is up.
When it comes to power prices, we see the ongoing debacle from those opposite, where they have failed to address it in their caucus despite it being such an important issue. They can have all the cups of tea that they like, but they need to reach a conclusion on the clean energy target. Basically, what that means for everyone out there is that they have to declare a winner between the Prime Minister and the former Prime Minister. That's actually the debate that is ongoing at the moment. But we know that a number of people have seen that wholesale power prices have doubled under Tony Abbott and Malcolm Turnbull. Only last week, the Reserve Bank governor added his voice to the long list of business voices that have said this government must adopt a clean energy target. We know what they did with education and the cuts to the Gonski funding, we know what they've been doing with their undermining of Medicare over a long period of time, and we know, despite all the rhetoric that they had in the lead-up to the budget, that they've done nothing to target or do anything about housing affordability. So the case is clear about why we need a new vision when it comes to these important issues.
The pleasing thing is that federal Labor have been leading the policy debate on these important issues. On secure jobs and fairer wages, we won't be slugging those who earn less than $87,000. Importantly in the current context, we will be reversing the cuts to penalty rates so that, for those people who can least afford a cut, Labor will be there to support them. On rising power prices, as I mentioned before, Labor stand ready to work with the government once they've declared a winner between the current Prime Minister and the former Prime Minister about who we need to talk to to get in place a clean energy target, which will be so important to providing stability and, in the long term, lowering the cost of electricity. On education we're very clear: we will restore the $22 billion that they have cut from all Australian schools. On housing affordability, we will reform negative gearing so that you can only negatively gear newly built homes, and reform the capital gains tax concessions that are unfair to so many people trying to enter into the new housing market.
But it's amusing to watch those opposite flounder about as they try to provide an example of what their vision is for this country. Speaker after speaker came in here, and you did not get a consistent message from any of them. That's because they don't have it. They are unsure what they will do to dig themselves out of their hole, whereas federal Labor will continue to provide the leadership that this country is looking for and provide the answers that the people want in this regard.
The DEPUTY PRESIDENT: The time for the discussion has now expired.
DOCUMENTS
Consideration
The following orders of the day relating to government documents were considered:
Documents presented by the President
1. Qualification of Senators Canavan and Roberts and former Senators Ludlam and Waters—Reference to Court of Disputed Returns—
Copies of letters from the President of the Senate to the Principal Registrar, High Court of Australia (Mr Phelan), dated 9 and 10 August 2017 [4].
Letters to the President of the Senate from the Principal Registrar, High Court of Australia (Mr Phelan) [4], dated 11 August 2017, and court notices, dated 11 August 2017.
Government documents
2. Institutional Responses to Child Sexual Abuse—Royal Commission—Criminal justice report, dated August 2017 (3 volumes).
3. Telecommunications (Interception and Access) Act 1979—Report for 2015-16 on the operation of the Act.
COMMITTEES
Foreign Affairs, Defence and Trade References Committee
Report
Senator GALLACHER (South Australia) (17:35): I present the interim report of the Foreign Affairs, Defence and Trade References Committee on the impact of Defence training activities and facilities on rural and regional communities.
Ordered that the report be printed.
Senator GALLACHER: by leave—I move:
That the Senate take note of the report.
I rise as Chair of the Senate Foreign Affairs, Defence and Trade References Committee to speak on the first interim report of the committee's inquiry into the impact of Defence training activities and facilities on rural and regional communities. The committee has decided to table interim reports after regional hearings so that local communities do not have to wait until the final report from the committee for issues in their area to be highlighted. To date the committee has been pleased with the level of engagement by the Department of Defence and the willingness of officers to acknowledge that there is room for improvement in their engagement with local communities.
To set the scene for the inquiry: the 2016 white paper indicated the government's intention to strengthen and increase investment in defence capabilities, which was supported by an increase in defence funding. The government has stated that it will implement a range of infrastructure initiatives to support future ADF operations, including upgrading training and facilities over the next 10 years. The white paper also signalled a new approach to defence industry policy, with a focus on small-to-medium enterprises. The focus was reiterated in the 2016 Defence industry policy statement. The Prime Minister and the government ministers have emphasised that the new investment in defence will create jobs across the region and bring benefits to local businesses and communities. These policies and statements from the government have generated expectations that regional Australia will be able to benefit directly and indirectly through participation of local businesses—in particular, small-to-medium enterprises—in building defence capability.
The focus of the committee has been to investigate whether regions, local businesses and local communities have access to information about the plans to expand or upgrade facilities so that they are in a position to offer goods and services. The committee also explored communication by Defence with stakeholders in local communities who will be affected by upgrades or expansion, as well as communication about existing training activities. In addition to looking at channels of communication, the committee spoke with businesses currently working with Defence in an effort to provide guidance for other businesses looking to engage.
The committee held a hearing in Port Augusta on 8 June 2017. The significant test and training areas in South Australia are the Cultana Training Area and the Woomera Range Complex, which will undergo expansion and upgrades. There are also regular exercises, such as Exercise Hamel in 2016 which was centred on the Cultana Training Area.
The committee was pleased to hear the overall message that Defence's presence is welcomed and supported in local communities. The committee would like to see Defence capitalise on this goodwill, as well as on the local knowledge, skills and experience. The committee recognises, as the local communities recognise, that Defence cannot source everything it needs locally. However, the clear message from the hearing was that local businesses wish to have the opportunity to be fairly considered when Defence is sourcing goods and services. The committee heard that there can be a perception that regional areas do not have the necessary skills to provide goods and services. There was a very clear message to the committee that the skills exist and the businesses are willing to engage. The information on local businesses' skills and capacity appears to be readily available.
There are challenges for local business, as most are small and medium enterprises, so scale can present some issues. Procurement processes can also be daunting, especially in documentation, which the committee heard can be onerous and complex. Local businesses also need to focus on maintaining their work in the local community as Defence work can be transitory.
I turn now to the mechanisms being used to engage and enhance local engagement with the potential opportunities from Defence. Communication, coordination and streamlining the dissemination of information are critical to maintaining and improving relationships. For relationships between Defence and the local communities, the committee heard that Defence has made a good effort in disseminating information on business opportunities as a result of the Cultana Training Area Expansion Project, as has tier 1 contractor St Hilliers.
Each regional area has its own communication mechanisms. The committee considered that there are a number of mechanisms in existence which form solid platforms for ongoing communication and coordination across the region. The committee also heard about a new initiative to bring together significant stakeholders from the region to develop a coordination framework. It would appear that this group would go a long way to addressing the coordination and dissemination of information, and the committee was pleased to hear that Defence is engaged in this forum. This forum could also be used to channel the information on local skills, businesses and capacity to appropriate areas, to ensure that businesses are in the best position to take advantage of the commercial opportunities, some of which will require support. There would appear to be channels in place to facilitate this support, including forums with Defence and others to provide training and capacity building as required.
Whilst appreciative of the expected surge in business during exercises, local businesses expressed disappointment that there had been little forewarning to them to allow them to maximise the business opportunities. The committee recognises that Defence must work within the Commonwealth procurement framework but will look more closely at the South Australian model and its applicability to Commonwealth procurement. The committee appreciates the willingness of Defence to engage with this model and the willingness of the industry advocate to engage with Defence.
The committee believes there should be a greater level of visibility and transparency of Defence engagement with local communities. Data at the national level means little in local areas. Defence was able to provide the committee with some information, breaking down contracts by region, and took on notice to provide further information.
The committee has made these initial recommendations: to ensure the most efficient communication mechanisms are in place for the most effective flow of information, which may generate potential business opportunities; to ensure as much information about upcoming training exercises is being disseminated with as much notice as possible; to explore further engagement with the industry advocate to investigate opportunities for events or workshops; and to make more information available to local communities about Defence expenditure in the area.
I thank the committee members for the bipartisan approach to this inquiry. In July, the committee held hearings in Rockhampton and Townsville, and there will be a separate interim report to cover these hearings. Later in the month, the committee is expected to convene hearings in Darwin and Katherine. This was initiated by an approach from the mayors of the Upper Spencer Gulf, who came to Canberra on their regular lobbying exercise and simply said: 'Defence is very welcome in our areas. We love having Defence there. They bring an incidental economic boost. The Cultana training area has been expanded. There is considerable investment of Defence funds in infrastructure but, basically, we can't see the opportunities. We need to be able to see where our local small to medium enterprises can actually get in and do some very valuable work in these small regional economies.'
We had a very successful bipartisan view about this. Former Senator Back was extremely supportive of this effort, as was Senator Fawcett and—I can't think of the other coalition senator that appeared. Basically, the whole effort was that regional Australians need investment and they need the visibility to exercise their skills and opportunities. If we can somehow encourage Defence to be a little bit more transparent and to invest locally it will be for the good of regional South Australia and, indeed, regional Queensland, the Northern Territory and wherever else we look.
I have to put on the record once again the extremely good work of the secretariat in this area. Secretary Sullivan and Suzanne O'Neill convened efficiently, as always. We have produced what I think is a credible piece of work which is worthy of the defence minister's consideration and, in my view, adoption. I seek leave to continue my remarks.
Leave granted; debate adjourned.
Strengthening Multiculturalism
Report
Senator DI NATALE (Victoria—Leader of the Australian Greens) (17:45): I present an interim report of the Select Committee on Strengthening Multiculturalism.
Ordered that the report be printed.
Senator DI NATALE: by leave—I move:
That the Senate adopt the recommendation contained in the interim report to extend the time for the presentation of the final report of the committee to on or before 17 August 2017.
Question agreed to.
Public Accounts and Audit Committee
Membership
Message received from the House of Representatives notifying the Senate of the appointment of Mrs Marino to the Joint Committee of Public Accounts and Audit in place of Mr Irons.
Rural and Regional Affairs and Transport Legislation Committee
Report
Senator FAWCETT (South Australia—Deputy Government Whip in the Senate) (17:46): On behalf of the Chair of the Rural and Regional Affairs and Transport Legislation Committee, I present the report of the committee on the provisions of the Regional Investment Corporation Bill 2017, together with the documents presented to the committee.
Ordered that the report be printed.
BILLS
Competition and Consumer Amendment (Misuse of Market Power) Bill 2017
Second Reading
Consideration resumed of the motion:
That this bill be now read a second time.
Senator DI NATALE (Victoria—Leader of the Australian Greens) (17:47): The Competition and Consumer Amendment (Misuse of Market Power) Bill 2017 ushers in a landmark reform to competition law in Australia. It's a bill that lowers the burden of proof so the ACCC can more easily take action against companies that misuse their market power. It is the culmination of a long campaign by many people, including my predecessor, Senator Christine Milne, former Leader of the Australian Greens, who worked tirelessly to see this change come into effect. She worked with people who have been done over by big businesses that have used their sheer size to squash competition and squeeze out their supply chains. It is a bill that brings into effect a policy that the Greens took to the 2013 election and the 2016 election. We are very pleased to have been a champion for this reform in this parliament.
It was on the day that Malcolm Turnbull actually challenged former Prime Minister Tony Abbott for the Liberal leadership that we saw the Nationals cross the floor to support a Greens motion on introducing an effects test. I'm sure it was at the front of their mind when they negotiated their secret wish list to support a Turnbull government in a formal coalition. Of course, we are seeing the repercussions of that wish list play out with the marriage equality debate right now. It is interesting that what we have got is a bill that is the result of two parties—not the two major parties in this place, but the Greens and the Nationals—who have championed this reform. We know the Liberals don't like it—they don't like it because it's not something that looks after their big business mates—but we know they are forced to cop it if they are going to stay in government with the support of the National Party. Of course, it will be the Labor Party that will be alone in opposing it.
What we have got, again, is not just Coles and Woolies literally using their market power but the Coles and Woolies of politics who have joined together in so many different ways to stymie this reform. Yet, thanks to some good fortune and circumstance, we have got a very important reform going through this chamber. It's a reform that's good for small business; it's good for farmers; it's good for consumers; and it is good for the economy. It's unquestionably a progressive step forward.
Currently, if the ACCC are to take action against a company for misusing its market power, they have to prove that a company intentionally took advantage of its market power to damage a competitor. In other words, it's not just the effect of the action but the intent. Of course, when we have laws that are seeking to prove intent, we set a very high bar, one that's almost impossible to prosecute. It's been very difficult for the ACCC to take action against big business that deliberately crowds out competitors and squeezes the life out of those further down the supply chain. Under this new law, the ACCC need to take action not based on the intent of a company but when the effect of a company's conduct is to damage competition. It might intend to do it; it might not, but an effects test says that, if big business behaves badly, that is the threshold for the ACCC to step in.
Oligopolies now define modern retail. We know that. From supermarkets to the large hardware chains to whitegoods to electronics to fuel to banking, it goes on and on and on. Shopping in Australia is now a big-brand experience. We know that sometimes there are benefits to it, but often there are huge costs to the long-term health of the market and the economy. That's why we always need to be aware of the role that oligopolies are playing and to ensure that there are measures in place to restrict their power when their power is squeezing out other competitors.
I have to say that it's not every day that we see government move ahead with a policy that is in the face of such strong opposition from some of those vested interests. We've been fighting for this for a long time, and the Liberal Party and the Labor Party have refused to entertain any change through that time. But what we see now is an effects test that acknowledges that what actually happens in a market is more important than what the theory says should happen in a market. An effects test says that the result is the thing that counts most. What is the result? What is the effect of these actions?
We know that it's supported by regulators, by academics, by consumer groups and, most importantly, by those many small businesses and farmers who have experienced what it's like to be stomped on by these huge, powerful behemoths of the market. An effects test is a win for many over the powerful interests of the few. It is very, very odd that, given all of those who are lined up in support of an effects test, it is the Labor Party that is standing alone as the voice against an effects test.
The only stakeholders that we can see standing with the ALP are the Business Council. You might be confused by this alliance, but, if you scratch the surface, you find that what you're seeing is a demonstration of the huge but largely silent power of the 'Shoppies' union. It is the Shoppies union who forced Labor to vote against marriage equality for years, time and time again, and who yet may exert their influence on some members of the Labor Party. They forced Labor to engage in a debate around school funding because it stripped out the special funding deals for Catholic schools. Now we're seeing the Shoppies union forcing Labor not to vote for a progressive policy outcome because it comes at the expense of Coles and Woolies. Remember Coles and Woolies, the big businesses that helped the Shoppies union stitch up a secret deal to leave a quarter of a million people, mostly young people, their members, getting screwed over with salaries that are below the minimum wage? Coles and Woolies help deliver the Shoppies their members. And, because there are so many members, they're a very powerful factional bloc within Labor. That is why you get the Labor Party now standing in opposition to what is a very, very positive reform for the nation.
I'm very pleased to stand here today and talk about the many ways in which the Greens have helped to shape the national agenda—the bank levy, for example. We stood firm many years ago proposing a bank levy, and of course we were ridiculed, it must be said, by the government. Yet now here we are with the government introducing a bank levy, something that the Greens campaigned on for many years. We came out and spoke strongly, loudly and passionately against negative gearing, something that distorts the housing market and means that young people don't get an opportunity to buy their own home in the way that their parents and grandparents did. It's great to see the Labor Party change their position on this and adopt some changes to negative gearing. We also championed the need for a banking royal commission. We put that to the parliament. It was voted against by both Labor and Liberal, and yet now we have seen the Labor Party change their tune on that and we are pleased to see it.
We've campaigned for so many things—medicinal cannabis, where we've seen significant reform—and now we have an effects test, this time supported by the government. We are seeing the Greens help shape both the national and economic agenda and the social and environmental agenda in this country. We are very pleased and proud to have championed this reform. I would like to pay tribute to my predecessor, Senator Christine Milne, who made sure that an effects test remained a central policy position of the Australian Greens—something she took to the 2013 election and something I am proud to be able to say the Greens have helped deliver in this parliament.
Senator LEYONHJELM (New South Wales) (17:56): For a supposedly liberal government, this is a shockingly bad piece of legislation. In a breathless rush to claim to be protecting consumers from wicked corporations, this bill seems to reflect a profound misunderstanding of both competition and the operation of the marketplace. The Competition and Consumer Amendment (Misuse of Market Power) Bill 2016 implements some of the recommendations of the Harper review of competition policy. Specifically, the Harper review concluded that section 46 of the competition and consumer laws, dealing with the so-called misuse of market power, should be amended to 'prohibit conduct by firms with substantial market power that has the purpose or likely effect of substantially lessening competition.' In line with these recommendations, the bill amends the Competition and Consumer Act 2010 to strengthen the prohibition of the purported misuse of market power and target supposedly anticompetitive conduct by corporations.
The current provision of the act outlaws conduct that (1) is by someone with substantial market power; (2) takes advantage of that substantial market power; and (3) has the purpose of eliminating or damaging a competitor, preventing entry or deterring or preventing competitive conduct. The new provisions continue to see so-called substantial market power as a problem but change the focus of concern away from eliminating or damaging a competitor to any action which supposedly substantially lessens competition. To add insult to injury, the bill is estimated to generate additional compliance costs of $2.5 million per year over the first 10 years as businesses are expected to seek legal advice on the new law. This cost will, of course, be ultimately passed on to consumers. Not only do we get more interference in the marketplace but consumers also end up having to pay for the privilege. Simply put, the entire approach of this legislation is irredeemably flawed.
In trying to work out when a business has an anticompetitive purpose or effect, the bill deems enhancing efficiency, innovation, product quality or price competitiveness as pro-competitive factors, even though businesses do these things with a purpose of reducing competition. They want the market to themselves, and this motivation is good. What is substantial market power? This simply reflects the success of a business in meeting consumer demand. Big businesses, which this bill seems to see as a root of all uncompetitive behaviour, all began as small businesses. They got to be big by being more competitive, not less, and by satisfying their customers better than their competitors, who remain small. In the free market, if you fail to meet the needs of your customers then, however big you are, you will lose market share and eventually close the doors. So, in order to become dominant, big businesses must be doing some things pretty right.
What the authors of this bill seemingly fail to grasp is what actually causes uncompetitiveness. Uncompetitive markets, including monopolies, are, without exception, caused not by businesses, big or otherwise, but by government policies that overregulate and restrict businesses: anticompetitive labour laws, usurious taxation and restrictions on supply and international trade—the list goes on and on. All inhibit the ability of new players to set up and compete. Invariably, government restrictions and controls tend to favour large, established businesses over small business and start-ups.
Naturally any business, big or small, will and should exploit any advantage that comes its way. However, if this leads to a monopoly or duopoly, big business should not be blamed for this, as the fault lies not with them but with the government. Many in this place have complained about retail market dominance by two players, about the dominance of banking in Australia by just four major banks and about the fact that we still have only two airlines dominating domestic air travel. However, the big retailers, banks and airlines are simply the ones with enough cunning to survive in the heavily regulated, taxed and controlled market created by government policy.
The key premise behind this bill is simply wrong. It was not and should never be the responsibility of businesses to encourage competition. A business enhances efficiency, innovation, product quality or price competitiveness because it wants to beat its competition, not increase it. Instead of banning individual corporate conduct with a purpose or effect of lessening competition, if anything, the bill should make such conduct compulsory. Companies should not be blamed or punished for simply exploiting government created market distortions that limit their competitors. All businesses have a responsibility to their shareholders to maximise profits in any market situation. If the government is stupid enough to distort the marketplace with taxes, labour laws and regulations that favour a few big businesses then it is the government, not the businesses, that is to blame.
This bill would have you believe that lack of competition is the fault of big business and that government legislation is the solution. In fact, the opposite is true. The bill will do nothing to increase competition. Increased competition comes from less regulation, less taxes and less restrictive labour laws. When the government actually comes up with legislative solutions that increase competition, they will have the Liberal Democrats' outspoken and enthusiastic support. In the meantime, I will oppose this bill.
Senator XENOPHON (South Australia) (18:03): I can indicate on behalf of my colleagues that we support the second reading stage of the Competition and Consumer Amendment (Misuse of Market Power) Bill 2017 and we're broadly supportive of this bill. It's been a long time coming, and we do actually need to have strong competition laws in place to prevent abuses of market power. Otherwise, it becomes a free-for-all. Otherwise, dominant players can squash the smaller players, and we've seen evidence of that where a small business that is trying to break into a market can be squashed as a result of predatory pricing practices of bigger operators, because they can afford to do that. That is something that this bill goes some way in addressing.
This bill is a result of the extensive work undertaken by Professor Ian Harper and the review panel. The government ought to be congratulated for undertaking this review. It was the first significant review of this type for many years, and it's a review that has been a long time coming, because of concerns that our competition laws have not been working as effectively as they can be. The practical consequences of that have been set out very eloquently by the great Australian writer Malcolm Knox, the author of the book Supermarket Monsters: The Price of Coles and Woolworths' Dominance, which was published in 2015, a couple of years ago. I commend this book to anyone who's interested in seeing the practical consequences of what happens when you have one or two businesses having an extremely large market share, because that market share brings with it enormous market power, resulting in distortions in the market and problems for smaller operators to do with that.
Now, in relation to this particular piece of legislation, I welcome it. I know that the Nationals have had a significant role in pushing for the effects test, which I think is a good test that ought to be introduced—in fact, it's been long overdue—but I believe it needs to go further. It needs to go further, because the effects test essentially cannot be triggered unless there has been a substantial lessening of competition. Those words 'substantial lessening of competition', I believe, are inherently too restrictive. I think we need to look at what the Europeans have been doing for a number of years in the way they look at competition law. They look at the impact of competition in the marketplace, which looks at it from a broader perspective rather than a very narrow test—a hurdle that I feel would be quite difficult to get over in many circumstances.
We need to see how this bill will work, but, having said that, I believe we actually need to have access to justice for this bill to effectively work. It's no good having a piece of legislation with beneficial clauses in it unless people can access those clauses. It's no good having a law in place unless you can enforce that law effectively. As it currently stands, small-to-medium businesses with clear cases of abuse of market power against them are prevented in practical terms from pursuing those claims due to the impact an adverse legal costs order would have on the business in the event their case were to fail.
A costs order is an elephant in the room that particularly prevents companies that have a good case from pursuing it further. There's one retailer in South Australia—I don't think it's necessary to identify that retailer—who has said to me that he's regularly advised by his lawyers that they actually have a good case for abuse of market power in the current provisions, but the problem is that if they lose the case they will be subject to a multimillion dollar costs order against them, in addition to the very high costs of bringing a case forward. That is a problem that does not exist in the United States or Europe, because cost orders are not made in those jurisdictions in competition matters. It's instructive that in the home of capitalism, the United States, they do not exclude small businesses from access to the protection of their competition laws. Their laws go much further to protect competition than Australian laws do now, or as proposed in this bill.
The Harper review acknowledged the problems of access to justice but offered no practical solutions to them. I note that Senator Katy Gallagher had a bill in this parliament that passed the Senate last week. When I spoke to her about this, she was concerned that I would damn her with faint praise. Well, she will be damned with faint praise. No, I will be praising her with real praise, because that is a good piece of legislation that I hope can pass through both houses of parliament. It finally tackles issues of access to justice so that you don't get these monumental cost orders against a small or medium business taking on a giant corporation. And that's why that bill is so valuable. I think that bill is so good that I've incorporated the provisions of that bill into an amendment to this bill. I understand Labor is opposed to this bill, but I would be gobsmacked if Labor would effectively oppose their own provisions of their own bill in the amendment that I propose to move that will incorporate their access to justice provisions. The government's bill, as good as it is in parts, will not be truly effective unless you tackle the issue of access to justice, and that is something that needs to be dealt with.
The other issue that this bill does not address is something that Senator Canavan has previously raised, and I appreciate his support for this issue. We need to have divestiture powers. You need that sword of Damocles hanging over companies, because it isn't enough if it's simply a monetary penalty. There's nothing like the fear of divestiture to change the culture of a corporate company that could be abusing its market power.
As it currently stands, in the rare situation where a market power abuse finding has been found by a court, the court can order the company be restrained and also impose a large financial fine against a company. And that's problematic, because no amount of restraint or fine will bring back to life the hundreds of small businesses that have been wiped out by large companies' misuse of their market power. And the perpetrators of market abuse can be so large that the fine will be considered by the offending company as simply a cost of doing business. This bill proposes positive changes to the way in which market abuse is proved but it does nothing with respect to enhancing the remedies. That is why there ought to be an ability for a court, as a last resort, to order divesture, which, like the sword of Damocles, would serve as the ultimate threat. It makes sense that a court should have a remedy in its tool kit that makes it impossible for a serious or big business offender to offend again.
The remedy of divesture has been available in the home of capitalism, the United States, for nearly 100 years. The US competition laws were born out of a community call to break up Standard Oil, which was misusing its market power in the oil refinery sector. With divesture written into the market power abuse statutes, the boards of big businesses will think more than twice before proceeding to misuse their market power against competitors. I am thankful for the support that Senator Canavan gave me when I introduced a bill to this effect several years ago. It didn't have much support from the major parties, but Senator Canavan, in a very sensible, erudite additional comment to that report, supported the bill for the reasons that I've outlined.
In relation to the position the Australian Greens have negotiated, I want to say at the outset that I do have enormous regard for Senator Whish-Wilson and the work that he has done and I'm sorry I didn't have a chance to speak to Senator Whish-Wilson previously. But I am disappointed that there weren't further amendments in relation to divesture, that there weren't further amendments in relation to abuses of market power, but also in relation to access to justice, which I think is very important. But I'm hoping that there will be another opportunity, sooner rather than later, to do that. I think there has been an opportunity lost here. I say that respectfully but with a great sense of disappointment because I think Senator Whish-Wilson and I share similar concerns about small and medium businesses being given a fair go in this country.
In relation to the amendments circulated by Senator Whish-Wilson on behalf of the Greens, this amendment relates to the government's proposal to repeal part XIB of the Competition and Consumer Act. The amendment will retain the existing enforcement powers that relate to the telecommunications industry. It is something I've raised on more than one occasion with the chairman of the ACCC, Mr Rod Sims. The repeal of part XIB was the subject of criticism of various telecommunications companies. While Telstra agreed with the proposal that part XIB provisions were are no longer necessary or appropriate given the amendments to section 46, Vodafone—VHA—expressed strong opposition to the repeal under divisions 2 and 3 under part XIB characterising the proposed amendments as unnecessary and premature.
During Senate Estimates in March this year I asked the chairman of the ACCC, Mr Sims, about the utility of part XIB in light of the amendments being made to section 46. He said there's a particular part of XIB that was put in place when the ACCC was having a lot of issues with Telstra and that they were very strong powers in terms of its ability to issue competition notices and fine them $1 million a day. The ACCC just felt that with where the telecommunications market is now, if the current section 46 changes go through then the ACCC has got all the adequate powers. So the other things we're looking at are different sorts of issues. Mr Sims went on to state that the ACCC does not judge that there is any reason to have the industry different to other markets and state that competition in the telecommunications sector, I think it is fair to say, has a long and complicated history.
In 2010, I moved amendments to strengthen the provisions of the Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill. That bill set a framework for either a voluntary structural separation or compulsory functional separation of Telstra and put in place a number of safeguards with regard to access competition and consumers, something I negotiated with then Minister Conroy. The key issue with respect to whether the Senate ought to pass the amendment was whether part XIB has served its purpose or whether the existing regime should be retained to act as a strong deterrent to anti-competitive conduct in the telecommunications sector.
The last competition notice was issued in April 2006, but this does not mean that part XIB has not been playing an important role. It is my view that the ability of the ACCC to issue a competition notice has been acting as a sufficient deterrent and should continue to operate within what is a dynamic telecommunications sector—or rather, a market is the sector, but it's a dynamic market as well.
Further, the ACCC is currently conducting a market study of the communications sector. The study will allow the ACCC to consider a wide range of interrelated developments that have been raised by the industry and go to the effective functioning of the market. It will inform how the ACCC will undertake its role in parts XIB and XIC of the Competition and Consumer Act to facilitate markets that provide consumers with a choice of products at a price and quality that meet their needs and circumstances. I do not believe it is appropriate to repeal part XIB prior to this market study concluding. I will review the report once it is completed, in order to ascertain if part XIB should remain in its current form.
I can indicate that I and my colleagues will support the amendments circulated by Senator Whish-Wilson. I do have more to say, Deputy President, but my voice is giving way on me—which I'm sure is something that my colleagues are very pleased to hear! So I will try and save my voice for the committee stages of this bill.
We support the second reading of this bill. We believe it can be improved. We believe there has been an opportunity lost in terms of further reforms. In particular, in relation to the issue of the abuse of market power, the threshold for substantial listing of competition I fear will be too high. But the general principle of an effects test is a good one, and that is why we want to see this bill go through—hopefully, with amendments that will strengthen it and make it much more effective.
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (18:16): I thank all senators who have contributed to this debate and commend the bill to the Senate.
Question agreed to.
Bill read a second time.
In Committee
Bill—by leave—taken as a whole.
The CHAIR (18:17): The question is that the bill stand as printed.
Senator XENOPHON (South Australia) (18:17): Chair, I have some amendments, and I will get your guidance as to how they are to be dealt with. I think I'm the first on the circulated amendments sheet. I'm happy to deal with those as you wish. I won't be proceeding with some amendments, so I will be guided by you as to whether it's appropriate that I firstly withdraw a particular amendment that's on the running sheet. In respect of amendment (1)—and I'm not sure if there's an amended sheet to that effect, but I will be guided by you as to whether it's appropriate that the amendments are dealt with at this point in time, given the running sheet in respect of the bill.
The CHAIR: Senator Xenophon, are you indicating that you don't want to move (1) because (2) is linked to it?
Senator XENOPHON: Yes, that's right. So, in terms of sheet 8139, I seek leave for what is referred to in item 1A to be withdrawn, but I seek leave still to proceed with item 1B, which is the amendment after section 80C.
Leave granted.
The CHAIR: Senator Xenophon has removed item 1A. Senator Xenophon, are you now seeking to move item 1B and amendment (2) together, on sheet 8139?
Senator XENOPHON: No, because—and I apologise, Chair—
The CHAIR: That's OK.
Senator XENOPHON: I can explain this: in relation to subsection 2, that relates to 51(3) after the amendments to do with item 1A. I only want to move the amendment on the original sheet that is headed '1B After section 80AC,' which starts off with 'Insert: 80AD Divestiture where contravention of section 46' down to subclause 6. The amendment (2) on the original sheet relates directly to the amendment that I do not wish to proceed with. So, it only deals with the issue—sorry, Chair, I understand there is a fresh amendment and I apologise—
The CHAIR: Okay, Senator Xenophon: you're amending section 1 and seeking to move that?
Senator XENOPHON: It's on sheet 8139, revised and hot off the presses. While that is being circulated, can I just indicate that the reason I'm not proceeding with that earlier amendment is that it was drafted at a time when there was a damage-to-competitors clause considered by the Harper review. It's no longer necessary, particularly with the rewording of the legislation—
The CHAIR: Senator Xenophon, with regard to your voice, you've sought leave on that and leave was granted so I think it's understood. So it's probably best if you save your voice for the things you really want to move!
Senator XENOPHON: Thank you. I thank Senator Whish-Wilson for the Strepsil. I'm not sure which Strepsil it is, but I won't consume it until I've sat down. I move:
Amendment No. (1) on sheet 8139 revised.
It relates to divestiture, and that includes a whole range of provisions in terms of adverse cost orders, assistance where there may be—sorry, let's just stick with divesture. I will deal with adverse costs shortly because—
The CHAIR: What you are seeking to do is to move No. (1) on sheet 8139 as revised?
Senator XENOPHON: That's right. It relates, as I indicated in my second reading contribution, to the issue of divestiture powers.
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (18:22): The government will not be supporting this amendment. The Harper review, like the Dawson and Harmer reviews before it, considered and recommended against establishing divestiture as a remedy to address misuse of market power concerns. At these reviews, each concluded that the existing range of available remedies is sufficient to deter misusers of market power and to compensate parties harmed by such conduct. Divestiture is not appropriate for breaches or misuse of market power as it would not target the conduct of concern.
But divestiture is currently available as a remedy for mergers and acquisitions which breach the Competition and Consumer Act. This is appropriate because the remedy directly targets and unwinds the transaction which breached the act. This would not be the case for section 46, where divestiture would at best be a blunt weapon which would not directly address the conduct of concern. The courts would then need to engage in the difficult task of restructuring what may be a highly-integrated firm to achieve this reduction in size. Moreover, there would be a high risk of unintended consequences—for example, a business or parts of it becoming uncompetitive or even unviable, which would be detrimental to consumer welfare.
As I've indicated in various reviews in this space—most recently the Harper Review but before it the Dawson and Harmer reviews—all looked at this and all recommended against it.
Senator GALLAGHER (Australian Capital Territory—Manager of Opposition Business in the Senate) (18:23): Labor won't be supporting this part of the Nick Xenophon Team's amendment. We note that the divestiture provisions are an extension of comments Senator Xenophon has made in the past.
The potential for repeat offenders of anticompetitive conduct is certainly a concern Labor shares. Labor has a proposed reformulation of how base penalties under the Competition and Consumer Act are calculated. We took that to the last election and we have recommitted ourselves to it.
Labor has proposed that Australia adopt a European Union-type penalty system for anticompetitive conduct, which is based on 30 per cent of the annual sales of the relevant product or service multiplied by the number of years the infringement took place, capped at 10 per cent of annual turnover. This would have both a punitive effect on culprits and a disincentive effect on potential culprits. We also note that this is a considerable departure from the status of the Competition and Consumer Act and that the amendment itself would warrant further scrutiny. A divestiture power that judges may apply would be a change to Australian competition laws on a large scale. As such, the measure itself would need to be considered on its own merits rather than in tandem with the proposed effects test. Normally a measure of this scale would be better suited to an in-depth inquiry conducted by a body such as the Productivity Commission. Further to that, drafting would require extensive consultation with extensive stakeholder collaboration. We won't be supporting this section of Senator Xenophon's amendment tonight.
Senator WHISH-WILSON (Tasmania) (18:25): I would like to start by noting Senator Xenophon's been nothing if not consistent on this over a long period of time. The Australian Greens would certainly like to continue the conversation on this with Senator Xenophon. The proposal in the amendment, which allows courts to make divestiture orders and enables courts to break up serious or repeat big business offenders, is an appealing one. I know the Harper Review didn't recommend it and instead suggested the power reside with parliament, but I would like to note that this is a very significant change in what's being proposed here tonight, and that warrants careful and stand-alone consideration, not just being a rider to this bill. This chance to change competition law, which we've got in front of us—on section 46—is critically important. Senator Xenophon, I've done a little bit of reading on the trust-busting legislation in the US. It's not used as often as people perhaps think it is, but nevertheless it's certainly something that interests me, and I would say to you tonight we will keep an open mind on it if it can be brought to this place with separate legislation.
As it is before us tonight, I'm not going to mince my words. If supporting this risks the other legislation going down—and the government said clearly tonight that they won't support it—then we won't be in a position to support this tonight. We would recommend that you bring this back to the Senate in the form of a private member's bill, and we'll give it due consideration.
Senator Xenophon: I did.
Senator WHISH-WILSON: Well, do it again.
Senator XENOPHON (South Australia) (18:27): Can I just thank my colleagues from the government, the opposition and the Australian Greens for at least stating their position on this. I won't be seeking to divide on this. I understand where the numbers lie on this. But I will just make this point to Senator Cormann, respectfully. The fact that we have a merger and acquisitions power that allows for divestiture within the mergers and acquisitions context indicates that the power does exist and the concept of divestiture is not a novel one in the context of competition law in this country. It's a point that can be made to the opposition and to the Australian Greens. I believe the time will come when divestiture will be seen as an appropriate last-resort remedy where divestiture doesn't mean the whole company is broken up. It could be that, in one state or one marketplace where a company has behaved particularly egregiously and abused its market power, the court should have the right to say, 'You will be broken up in that particular market.' That to me is in some respects more targeted and more nuanced, in a sense, than having an approach where it's just an across-the-board 30 per cent fine or a 10 per cent fine on their turnover—which I'm not opposing from what the opposition is proposing. I think this should be in the toolkit of the courts.
In Europe, they do have divestiture powers. The reason you don't hear about them is that they're not used very often. It is a last-resort power and, as Senator Whish-Wilson said, they're not used much in the US, because it does change the culture of corporations. If a corporation realises and understands that it can be broken up in whole or in part by abusing its market power, that makes a difference to the culture of that corporation and their conduct in the way they deal with smaller companies down the supply chain. That to me would have a very beneficial and powerful role in changing corporate culture in this country in terms of the abuse of market power.
I am grateful to my colleagues for having the courtesy to indicate why they don't support this. My prediction is that eventually in this place we will have a divestiture power and it will be a good thing for competition law, for the conduct of businesses in this country and for competition and the chance it will give for small businesses and medium businesses to have a level playing field against the big guys.
Question negatived.
Proceedings suspended from 18:30 to 19:30
Senator XENOPHON (South Australia) (19:30): I have another amendment to move—I think now is the appropriate time—and, insofar as I need to, I seek leave to move that amendment.
The TEMPORARY CHAIR ( Senator Williams ): You do not need leave. Continue, please.
Senator XENOPHON: I was just being very cautious in this place. We have to be very cautious about all the things we do, like citizenship and all those sorts of things. I move amendment (2) on sheet 8139 revised in relation to cost orders:
(2) Page 13 (after line 8), at the end of the Bill, add:
Schedule 3—Adverse costs orders
Australian Small Business and Family Enterprise Ombudsman Act 2015
1 At the end of section 7
Add:
; and (h) conduct within the meaning of subsection 4(2) of the Competition and Consumer Act 2010.
2 At the end of section 15
Add:
; (c) to give assistance under Division 3A of Part 4 in advising on and preparing a person's case for a no adverse costs order under subsection 82(4) of the Competition and Consumer Act 2010.
3 After subparagraph 23(h) (ii)
Insert:
(iia) assistance being given under section 74B (assistance in relation to a no adverse costs order in proceedings to recover the amount of any loss or damage as a result of contraventions of the Competition and Consumer Act 2010);
4 At the end of section 65
Add:
; (g) conduct, within the meaning of the Competition and Consumer Act 2010, that:
(i) may be in contravention of a provision of Part IV of that Act; and
(ii) affects, or may affect, a small business or family enterprise.
5 After Division 3 of Part 4
Insert:
Division 3A—Assistance where there may be a contravention of the Competition and Consumer Act 2010
74A Application of this Division
This Division applies if the relevant action in relation to which a person requests the Ombudsman to give assistance is conduct, within the meaning of the Competition and Consumer Act 2010, that:
(a) may be in contravention of a provision of Part IV of that Act; and
(b) affects, or may affect, a small business or family enterprise.
74B Ombudsman may give assistance in relation to costs order
(1) The Ombudsman may assist the person by doing either or both of the following:
(a) advising the person on the arguments that might be made, and the evidence that might be adduced, to satisfy a court that an order under subsection 82(4) of the Competition and Consumer Act 2010 should be made (a no adverse costs order in proceedings to recover the amount of any loss or damage as a result of contraventions of that Act);
(b) preparing arguments that might be made in satisfying a court that an order under that subsection should be made.
(2) Nothing in this section limits the functions, duties and powers of the Ombudsman under this Part in relation to the relevant action.
6 At the end of Division 2 of Part 5
Add:
91A Disclosure for the purposes of a no adverse costs order under the Competition and Consumer Act 2010
(1) This section applies if the relevant action in relation to which a person (the applicant) requests the Ombudsman to give assistance is conduct, within the meaning of the Competition and Consumer Act 2010, that:
(a) may be in contravention of a provision of Part IV of that Act; and
(b) affects, or may affect, a small business or family enterprise.
(2) A person assisting a small business or family enterprise may disclose to the applicant any document or information obtained by the person assisting the small business or family enterprise in the course of performing functions or duties, or exercising powers, in relation to assistance given to the applicant under section 74B.
Note: Section 74B allows the Ombudsman to give assistance in relation to a no adverse costs order in proceedings to recover the amount of any loss or damage as a result of contraventions of the Competition and Consumer Act 2010. This assistance may include advising the applicant on the arguments that might be made, and the evidence that might be adduced, in pursuing a no adverse costs order, and preparing arguments.
Competition and Consumer Act 2010
7 At the end of section 82
Add:
No adverse costs orders
(3) A person who brings an action under subsection (1) in relation to a contravention of a provision of Part IV may at any time during proceedings on the matter seek an order under subsection (4) from the court hearing, or that will hear, the matter.
(4) The court may order that:
(a) a respondent in the proceedings is liable for any of its costs in relation to the proceedings; or
(b) two or more respondents in the proceedings are jointly and severally liable for any of their costs in relation to the proceedings.
(5) The court may only make an order under subsection (4) if the court is satisfied that:
(a) the action has a reasonable prospect of success; and
(b) the action raises an issue that is not only significant for the applicant, but may also be significant for other persons or groups of persons; and
(c) the disparity between the financial position of the applicant and the financial position of the respondent or respondents is such that the respondent or respondents could use the possibility of a costs order that does not favour the applicant as a means to deter the applicant from pursuing the action.
(6) A person who appeals a decision of the court under section (4) is liable for any costs in relation to the appeal.
8 Application
The amendment of the Competition and Consumer Act 2010 made by this Schedule applies in relation to actions under subsection 82(1) of that Act brought on or after 1 July 2017.
This relates to adverse costs orders. As I indicated in my second reading contribution, no matter how good a piece of legislation is—and I think it is fair to say that this has good elements, but I believe it should have gone further. Notwithstanding that, we need an ability to have real access to justice for competition law in this country. As I indicated previously, there are many businesses who get advice from their lawyer saying there has been an abuse of market power—predatory pricing or whatever the breach may be—but the lawyer then advises their client, 'By the way, if you want to take this to court, you'll be spending a couple of million dollars and you might be up for an adverse cost order in the millions of dollars.' An adverse cost order could be $5 million, $10 million or $15 million, depending on the complexity of the case, because these can be complex matters.
What I have done here is to move amendments that—and I make no apology for this—are effectively lifted from the amendments that Senator Gallagher moved in her bill, a very good piece of legislation. I think Senator Gallagher was concerned I would be damning her with fake praise. I am praising with her real praise. There is a big difference between the two. My colleagues and I supported her bill, which I was very pleased to see pass the Senate last week as a private senator's bill, and I hope it will pass the lower house as well.
That bill sets a framework for the first time in this country to allow for real access to justice where there can be a whole range of measures: ensuring there are no adverse cost orders; having the office of the Australian Small Business and Family Enterprise Ombudsman act as part of the framework of this; enabling applications to be made for assistance and enabling the ombudsman to give assistance in relation to cost orders. It would provide a framework, as set out effectively in Senator Gallagher's bill, as incorporated in this amendment, to ensure that, once and for all, we can proceed to test the competition laws in this country in a way that would make sure they have real teeth. That is why I think Senator Gallagher's bill is such a good bill and why it needs to be incorporated in this particular amendment, to give real teeth to these competition laws.
Mr Temporary Chair—I know this is a bit unfair on you because I know you can't interject from the chair, but your interjection would be one of hearty support, I'm sure—you and the Nationals have had a very important role in driving competition law reform in this country and you should be congratulated for it. All I am seeking to do here is to ensure that this piece of legislation works as intended. It won't work as intended unless we have real access to justice. This is what these amendments are about.
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (19:34): The government will not be supporting the amendment. The Senate might recall that similar amendments, if not the same amendment, was actually passed as part of a different bill so they arguably double-up what was dealt with before. We believe this is poorly thought out policy with significant implementation issues, which will not have any real practical benefits for small business. Enabling courts to grant cost waiver orders to small business at the outset of a case would raise significant practical issues. It is unclear how a court could be expected to assess the merits of a case at the start of a matter—that is, before evidence has been tested by the parties. This creates a significant risk of cost waiver orders being granted inappropriately.
The party in receipt of the no adverse costs order is incentivised to take up belligerent litigation tactics which are unhelpful for the court. This policy would also have workload implications for the Federal Court. The workload of the Federal Court would increase, as judges would be called up to make cost waiver assessments. The proposal to allow the Small Business Ombudsman to provide a professional opinion on the likelihood of a party successfully obtaining a no adverse costs order would appear to require the office to provide a form of legal advice which is not appropriate for a public statutory office of this nature.
It is not clear how a party who took up litigation on the basis of such an assessment and subsequently did not obtain an order in their favour could then withdraw from the litigation without a cost penalty. We will not be supporting these amendments.
Senator GALLAGHER (Australian Capital Territory—Manager of Opposition Business in the Senate) (19:36): Thank you very much for the call. I also acknowledge Senator Xenophon's support for Labor's small business access to justice policy and I thank him for his support last week. We appreciate the fact that these amendments of Senator Xenophon's have been split which allowed us to support this section of his amendments whilst noting that we strongly oppose this legislation as it stands. We voted that way at the second reading stage.
We are opposed to the effects test; however, we do support the lift of Labor policy into Senator Xenophon's amendment. I agree with him that, in terms of drafting that bill and formulating our policy prior to the last election, it was really about providing real access to justice for small and medium businesses. Anyone who spends any time with small business will hear stories of reluctance to pursue anticompetitive conduct based on the uncertainty of the costs associated with pursuing that and the acknowledgement that large corporations—big business—have very deep pockets. In terms of protecting their markets, they are prepared to dig deep into those pockets to ensure that small business doesn't pursue practical access to justice. That is exactly what these amendments sought to address in last week's bill and we certainly support the amendment here tonight.
In terms of some of the comments Senator Cormann just made in criticising this, there is a public interest threshold that would be assessed against the no adverse costs order amendments as part of our legislation. It's not predetermining every case. It is looking at cases where the court has decided that there is a public interest question at stake. But, having said that, we will be voting against this bill for the reasons I have already outlined at the second reading stage. However, we are happy to support Senator Xenophon's amendment.
Senator WHISH-WILSON (Tasmania) (19:38): I won't speak for very long on this, because I think it's already been stated by the Labor Party—and the government to some extent—that this is a duplication, essentially, of what we considered in a private member's bill in this place only a few days ago. I understand there may be some slight differences, but this is something that Senator Xenophon has been talking about for some time. I am not sure if Labor got their idea from this but, nevertheless, I am sure you will be happy with the fact that we all agreed on a private member's bill in here that essentially does what you have been campaigning on for some time. We already voted for it. We commended the Labor Party for bringing it forward. I thank Senator Xenophon for his amendment, but we don't feel there is a need to support this tonight given we have just supported the private member's bill.
Senator XENOPHON (South Australia) (19:39): Now is the time to support this amendment. This is something that Senator Gallagher and others in the Labor Party have done a lot of good work on—
Senator Gallagher: You could actually amend the bill.
Senator XENOPHON: Here's an opportunity to amend the bill now. Here's an opportunity to progress this issue now. It is an opportunity that will make a difference to access to justice.
With respect to Senator Cormann, in terms of his comments, this is not about belligerent litigation tactics. I have a tiny law firm that knows a bit about litigation, and the biggest single impediment for small businesses to take on a big corporation is the adverse cost orders. The biggest single impediment for a small business to defend itself in a case, even where it could be meritorious in terms of their defence, is the cost orders that will crush them. Often, if there is some small element of risk, they will try and resolve the case, because the consequence of losing the case could be that their business would be destroyed or go into liquidation or that they would be personally bankrupted. The belligerent litigation tactics come from those with very deep pockets.
I have been talking about issues of access to justice for a number of years. Senator Gallagher has done terrific work on this, and none of that should be taken away from her or her colleagues who put up this bill that I am very pleased to support.
On the issue of a cost waiver, there has to be a public interest requirement. The cost waiver is one that will be used only in public interest cases. This won't open the courts to a flood of litigation, but it will open the courts to real access to justice for those who need it most. That's why I support this amendment.
Senator WHISH-WILSON (Tasmania) (19:41): I want to get it on record, in case I wasn't clear, that we support the intention of this, as we did with the private member's bill, but the difference between us and the Labor Party is that this is not the main game. The main game is amending section 46, a law that we know is unworkable in this country and that we have been campaigning to amend now for some years. That's what we have before us here in the chamber today.
The government has made it clear they won't support this. Labor wants the Greens and others to support this, because they want the bill to be torpedoed. They want this to go down. But we have campaigned long and hard to get section 46 amended. That's the main game here today. We are happy to work with Senator Xenophon or Labor on their private member's bill, and we hope the government gives that consideration when it goes to the other place, but we are here tonight to get a very important reform in place in this parliament, and that is amending section 46 of the Competition Act.
The DEPUTY PRESIDENT: The question is that the amendment as moved by Senator Xenophon, No. 2 on sheet 8139 revised, be agreed to.
The Senate divided. [19:47]
(The Deputy President – Senator Sue Lines)
Senator WHISH-WILSON (Tasmania) (19:50): I move Australian Greens amendment to the Competition and Consumer Amendment (Misuse of Market Power) Bill 2017 on sheet 8190:
(1) Schedule 2, page 8 (line 1) to page 13 (line 8), omit the Schedule, substitute:
Schedule 2—Telecommunications industry
Competition and Consumer Act 2010
1 Paragraph 151AJ(3)(a)
Omit "45B, 46,".
2 Subsections 151AJ(4) and (5)
Omit "45B, 46,".
3 Paragraph 151AJ(5)(a)
Repeal the paragraph, substitute:
(a) the assumption that subparagraphs 45(3)(a)(ii) and (b)(ii) had not been enacted;
4 Paragraphs 151AJ(5)(c) and (d)
Repeal the paragraphs.
5 Subsection 151AJ(7)
Omit "45B, 46,".
6 Paragraph 151AJ(7)(d)
Repeal the paragraph.
7 Subsections 151BC(4) and (5)
Repeal the subsections.
There is one amendment to this bill. It relates to schedule 2, on the telecommunications industry.
Just a little bit of background: the Competition and Consumer Act currently includes an effects test for the telecommunications industry, as well as giving the ACCC greater powers of intervention and the ability to issue competition notices against misuse of market power in the telecommunications industry. The bill before us tonight proposes to remove both these existing provisions on the grounds of duplication. Our amendment retains these powers.
Let me explain a little more about the existing provisions that are currently in place and why we wish to retain these. Division 2 of part XIB sets out the telecommunications-specific competition rule which prohibits a carrier or carriage service provider—called a CSP—from engaging in anticompetitive conduct. Essentially, this is an effects test applying only to the telecommunications market. Let's make this point very clear: we have, for all intents and purposes, an effects test in the telecommunications market right now. And let me make this point clear: stakeholders in the telecommunications industry have been knocking on our door, as I am sure they have on other senators' and MPs' doors, asking us to maintain the effects test as it stands—and I will call it an effects test—because it works for them and they have confidence in it.
My third point, to make it very clear, is that, if you support the Greens amendment tonight to retain this because you recognise that the telecommunications industry likes what's in there now and thinks it works, on principle you support an effects test—a broader effects test for other industries. Let's make that very clear.
What we have at the moment is an effects test applying only to the telecommunications market. Division 3 of part XIB grants the ACCC power to issue competition notices in respect of a contravention to the competition rule. That's called division 2. There are two types of competition notices, part A and B notices, that differ with regard to the particulars of the contravening conduct that the ACCC must include. The issuing of a competition notice requires a carrier or CSP to cease engaging in the identified anticompetitive conduct subject to high potential fines. Division 3 also allows for a person to apply to the ACCC for an order exempting specified conduct for the scope of the anticompetitive conduct provisions in division 2. Overall, by providing for the issuing of competition notices, division 3 enables the ACCC to respond quickly to anticompetitive conduct in the sector.
It is interesting to note also tonight, that Telstra is the only body that is calling for the removal of the ACCC's current intervention powers. We believe they should be retained because not only is the industry firmly of the view that they have worked and they are very confident in them but they give the ACCC the capacity to intervene early in the piece should they see potential misuse of market power. Further, given the rapidly-developing and asymmetrical nature of the telecommunications industry, the retention of the existing provisions is prudent.
I will finish by saying that I hope the Senate can support this amendment. I understand the government will be supporting our amendment tonight, and I thank them for this. I understand that Senator Xenophon will be supporting the amendment. I'm not sure about the other crossbenchers and I'm not sure of Labor's position. I'm guessing they won't be supporting this because this is an effects test—an effects test that seems to work and has the industry engaged and out there lobbying for it to be retained. I thank the government for their flexibility on this. We were working very closely with the telecommunications industry. This was a sticking point for them and for some senators in the Greens, and we thank them for keeping this in place. It's a very powerful symbol that an industry, like the telecommunications industry, believes that an effects test is effective, hence the logic for us transferring this more generally to section 46 for other industries' potential misuse of market power. It's what the ACCC have been asking for.
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (19:55): The government will indeed be supporting this Greens amendment. This amendment will replace schedule 2 in the bill with a new schedule. The new schedule will retain the telecommunications-specific anticompetitive conduct provisions in part XIB but stop the new broader section 46 flowing through to that part. As introduced, the bill sought to repeal the anticompetitive conduct provisions in part XIB in light of the introduction of the broader and stronger general misuse of market power law in section 46. With the strengthening of section 46, it would not have been necessary to apply part XIB because section 46 effectively supersedes the competition law rule in XIB. It would also be inappropriate for section 46 to flow through unimpeded to part XIB because of the unique and heavy-handed enforcement mechanisms in part XIB.
Competition notices, which can result in significantly higher pecuniary penalties and the reversal of the onus of proof, are designed for a completely different legal trigger. Our view is that a strengthened section 46 will be able to address any misuse of power in the telecommunication industry. In addition, the Australian Competition and Consumer Commission continues to retain other targeted powers to deal with competition concerns in telecommunications. However, it has also become clear that the repeal of the part XIB rules is not supported by all senators. Given this, the government will support the alternative approach developed by the Greens. This retains the part XIB provisions but stops the new section 46 flowing through to part XIB. This approach will leave part XIB largely in place as it stands, with its own additional enforcement provisions but linked to the existing lower effects test. However, the new section 46 will not be enforceable using the disproportionate enforcement mechanism in part XIB. The amendment does not change the new section 46, which will apply to all sectors of the economy.
Senator GALLAGHER (Australian Capital Territory—Manager of Opposition Business in the Senate) (19:57): Labor will be supporting the Greens amendment despite the very ungenerous speech by Senator Whish-Wilson. Coming from a party that just reversed its position on the amendment that Senator Xenophon moved around access to justice compared to their position last week, it was very ungenerous to then stand up and start attacking Labor when we are prepared to support your amendment, Senator Whish-Wilson—despite our overall concerns about the bill as a whole, and which we remain opposed to.
To just pick up on your argument, I would pose this question. If the amendment that you are moving is accommodated in the bill that the government has introduced, and extrapolating your argument that by supporting your amendment we obviously support the effects test, then my question would be: why are you moving this amendment? If this is dealt with under the government's bill, then why the need for the specific amendment that you are moving, Senator Whish-Wilson? It is entirely reasonable for Labor to support this amendment, as you yourself have recognised. You drafted this amendment and you have done a deal with the government, which forced you to oppose the access to justice provisions that you supported last week. Be up-front about it; don't then come swinging at us when we have legitimate reasons to be supporting this amendment as it deals with safeguards in the telecommunications sector, a very specific issue, rather than the much broader application of the section 46 amendment. We are happy to support it. Our position is consistent. By doing so, by supporting it, it does not mean that we will be supporting the broader application of section 46, which we remain opposed to.
Senator WHISH-WILSON (Tasmania) (19:59): I can't let that go unchallenged.
Senator Gallagher: You can actually.
Senator WHISH-WILSON: It's interesting—
Senator Gallagher interjecting—
Senator WHISH-WILSON: You're screaming blue murder because we didn't support Senator Xenophon's amendment. If you think that's really important, why did you bring your private member's bill in here in the first place? You were trying to put up a smokescreen so you didn't have to vote for section 46. We all know why you didn't vote for section 46, a very comprehensive reform that we have been campaigning on for years. Why bring the private member's bill and waste the Senate's time and money if you thought we were going to get this amendment here tonight? I didn't hear from Senator Xenophon before tonight about his amendment on costs. If I had, we may have had a different considered position. All I know is that we voted on Labor's private member's bill a couple of days ago but that no-one came to see the Greens to support this amendment. Don't accuse us of being hypocrites.
The TEMPORARY CHAIR ( Senator Williams ): The question is that Australian Greens amendment (1) on sheet 8190 be agreed to.
Question agreed to.
The CHAIR: The question is that the bill, as amended, be agreed to.
The committee divided. [20:05]
(The Chair—Senator Lines)
Third Reading
Senator CORMANN (Western Australia—Minister for Finance and Deputy Leader of the Government in the Senate) (20:07): I move:
That this bill be now read a third time.
The PRESIDENT: The question is that the bill be now read a third time.
Senator Collins did not vote, to compensate for the vacancy caused by the resignation of Senator Back.
Bill read a third time.
The Senate divided. [20:09]
(The President—Senator Parry)
Australian Nuclear Science and Technology Organisation Amendment Bill 2017
Second Reading
Consideration resumed of the motion:
That this bill be now read a second time.
Senator KIM CARR (Victoria) (20:11): The Labor Party will support the Australian Nuclear Science and Technology Organisation Amendment Bill 2017. It's a bill which will allow for the crucially important public funding of a research agency to expand its operation. ANSTO conducts its operations at the Sydney campus, which is the nuclear research reactor at Lucas Heights, and at the Melbourne campus, the Australian Synchrotron.
I regard ANSTO as one of the jewels in the crown of the Australian innovation system. ANSTO is one of those organisations that have gone from strength to strength. ANSTO is one of those organisations that I think are undervalued within this country. Of course, it's one of those organisations that people are only too happy to call upon, particularly when it comes to radiopharmaceuticals. I note that people are only too happy to complain about the use of nuclear research, except they fail to appreciate very fundamental questions about the value of nuclear research in so many aspects of everyday life, everything from smoke detectors to dials that we use on our clocks. This is, of course, an area of activity which was underestimated in its importance across the country.
ANSTO has expanded its activities at its Sydney campus, including at its nuclear medicine facility, and it has tripled production of molybdenum-99, which has been in worldwide shortage. Something like 800,000 Australians every year enjoy the benefits of this radiopharmaceutical. The aim, of course, of this proposed new development is to build a campus of major national innovation precincts. The legislation governing ANSTO unduly restricts its scope and the potential for the precinct. However, this legislation preserves the public interest and ensures that land cannot be alienated but can be used in such a way as to attract new investment and allow for operations to be expanded and for greater collaborations between the public and private sectors in an important area of public good—research.
As I said, the legislation as currently formed is unduly restrictive on what ANSTO can do. The bill overcomes this by allowing ANSTO to share its knowledge, expertise, facilities and properties with other entities. These entities need not have a direct involvement in nuclear science or technology but, of course, will need to be associated with the direct work that ANSTO is undertaking. The bill widens the definition of scientific research, innovation and training in ANSTO so that they are able to go beyond immediate work on nuclear science and technology.
The precinct itself will aim to produce a graduate institute providing research positions for up to 400 postgraduate students and postdoctoral fellows at both Sydney and Melbourne campuses. I regard that as an extraordinarily ambitious target. I look forward to that actually being achieved. Nonetheless, I think the framework for this legislation allows that ambition to be pursued and I look forward to working with ANSTO to see that that is actually able to be pursued.
The changes that we're seeing here allow ANSTO to cooperate with industry, with universities, and with other publicly funded research agencies. This is the kind of exchange between sectors and agencies which I promoted when I have been the minister. It is an area of public enterprise which this parliament should encourage and should develop; therefore, I think this bill is entitled to be supported. I look forward to the measures that were actually initiated by the previous Labor government in this area, which saw the development of the innovation precincts across this country, which led ultimately to the Australian jobs plan which was developed in 2002. I believe this is an extension of that type of thinking, and it is appropriate that this bill be endorsed by this parliament.
Senator HANSON-YOUNG (South Australia) (20:16): The Greens will be opposing the Australian Nuclear Science and Technology Organisation Amendment Bill 2017. We're disappointed to see that Labor is jumping over the divide here to support the government in this. We're not going to be supporting it, because we have serious questions in relation to why this is needed. We have questions that have yet to be answered by the government or, indeed, anyone within the bureaucracy who has been pushing for this much needed—so they say—legislation.
This bill will extend the functions of ANSTO to cover purposes relating to the security and defence of Australia. There is no explanation from the government about the intent or the need of this expansion of responsibility. I'd invite the minister, in his closing remarks, to perhaps give us a sense of why he thinks that this is actually needed because, to date, there has been no forthcoming explanation that is, in any way, plausible. It shouldn't be left to the opposition to do the government's work.
Senator Kim Carr: I just did.
Senator HANSON-YOUNG: I take that interjection from the opposition. There seems to be very little clear relationship between the medical research that ANSTO does and this proposed new responsibility of keeping Australia safe. What is the rationale, exactly, for that? This is a very serious question that hasn't been answered. So, if the minister would like to give us an explanation to that, we'll be looking forward to hearing it. Australia waging deeper intergeneration for nuclear research is a deep, serious question that cannot be answered from only hearing one side of the debate and that's all we've had to date. The generation is for those reactors that still do not exist; yet, supposedly, they are going to lead us to a place where nuclear products will be the saviour of the world, without the dangerous waste and practices. Well, we're yet to see any of that happen at all. We know this has been talked about for decades, and very little has come of it but, while it goes nowhere, the costs keep climbing. We do not want to be pursuing this course when we could be spending public money on more productive areas of research. This is an expensive white elephant without any justification, and here we see the government simply sinking more and more money into this black hole.
It is a very legitimate public policy question but the Joint Standing Committee on Treaties did very little evidence gathering in relation to this. It only heard from ANSTO in a one-day hearing on the future generation programs. We didn't even hear from the Australian Conservation Foundation or the Friends of the Earth—those other voices that often are used to help balance the rationale, the concerns and to point out the dangerous risks in these things. It was a done-and-dusted inquiry, pushed as quickly through this place as possible. Of course, there is a reason that the government doesn't want these experts to be heard; it is because they don't want the questions to be asked and they don't want the evidence to be borne out.
We should, to be absolutely frank with you, Mr Acting Deputy President Williams, start this process again so that we can hear from all voices in relation to this debate—so we can hear whether Australians actually want to be expanding this type of research on this expensive path. When you think about all of the other areas of research that people are crying out for, here we have more public money and more demand on the public purse coming from a small in number but loud minority voice. It's simply something that the Greens cannot support.
All of these measures are pushing Australia closer to nuclear power. We know that it's expensive, it's not safe and that there's no place to deal with the waste in a reasonable way, though of course I guess that people in this place say, 'Oh, well, just dump it in South Australia!' I can tell you, as a South Australian, Mr Acting Deputy President, that we're not particularly happy about that either.
There is no hint of us changing our two sets of laws preventing this. Nuclear power the world over has been beset with cost overruns, delays and the inability to complete. And here we are seeing more money sunk into a white elephant, with the bipartisan support of both the Labor Party and the Liberals. So until some of these deeper questions can be answered and until it is put forward fully why this is needed, the Greens are not convinced at all and we will not be supporting this legislation.
Senator LEYONHJELM (New South Wales) (20:21): I rise to support the Australian Nuclear Science and Technology Organisation Amendment Bill 2017, which broadens the function of the Lucas Heights nuclear facility to include scientific research, innovation and training. I had the pleasure of a tour of the facility a few months ago, which helped me to understand its capabilities.
What this bill does, in terms of allowing ANSTO to do more than it can at the moment, is not enough. We must go further, because Australia is a nation of Luddites when it comes to things nuclear and, like all other Luddites, we're destined to get poorer and poorer as a result. If the government were genuine about being agile, innovative and technology-agnostic and about easing the cost of living for Australians facing huge electricity bills—and even about reducing Australia's greenhouse gas emissions—we would regulate rather than ban nuclear power.
We hear a lot about renewable energy, whose share of global electricity generation was 0.6 per cent 40 years ago and is now 6.3 per cent. But nuclear power has grown by more than this. It was 3.3 per cent of global electricity generation 40 years ago and is now 10.6 per cent. This growth of nuclear power has occurred despite the handful of kneejerk reactions we saw after the 2011 disaster in Japan, where an earthquake and tsunami killed 20,000 people, while the resulting meltdown of an old and poorly-sited nuclear power plant killed no-one.
Nuclear power remains an unremarkable feature of electricity markets in numerous countries, including South Korea, Sweden and, particularly, France, where 75 per cent of electricity generation is nuclear. As the government's Finkel review admits, countries such as the United States, United Kingdom and China are now developing small, modular reactors to further expand their nuclear power. But this brief acknowledgement of nuclear is all that Finkel has to say on the matter. There are no recommendations on nuclear power, no inclusion of nuclear power in the cost comparisons between technologies and no inclusion of nuclear power in the comparisons on emissions intensity. It seems that Finkel was simply tasked with coming to the bizarre conclusion that fossil-fuel-based power generation is somehow more expensive now than in the past, and that we should have a carbon tax that isn't called a carbon tax and doesn't generate any revenue. It seems that Finkel stuck to his brief. What a shame he couldn't have been more agile.
If the government were genuine about being agile and innovative, we would exploit the huge business opportunity to store nuclear waste—not just our waste but the waste of the rest of the world. We already store waste at Lucas Heights, with no detriment and no hysteria, despite the fact that this is essentially a suburb of Sydney and that more than four million people live in the vicinity.
Australia is the most geologically-stable land mass on earth, and we also have a stable and secure system of government. By rejecting the option of securely storing the world's nuclear waste, we are missing an opportunity for higher incomes and increased tax collections.
The taxpayer is also taking a hit through our rejection of nuclear submarine technology. We are paying France $50 billion to gut their stealthy, long-range, nuclear-powered submarines so that noisy, range-reducing diesel engines can be fitted instead. This is absurd. Maintaining nuclear-powered submarines is not beyond a technologically advanced country like Australia. Our national defence deserves it, and our taxpayers deserve it.
Whether it's nuclear power, nuclear waste or nuclear-powered submarines, Australia is in a bad place that we need to get out of. A bit of agility and innovation is required.
Senator SINODINOS (New South Wales—Minister for Industry, Innovation and Science) (20:25): The Australian Nuclear Science and Technology Organisation Amendment Bill 2017 makes minor but important amendments to the ANSTO governing legislation, the ANSTO Act. The amendments will allow our national nuclear science agency the flexibility to successfully establish an innovation precinct adjacent to its Lucas Heights campus in southern Sydney and will allow ANSTO to potentially establish additional precincts in association with its other campuses. More broadly, the bill will facilitate enhanced collaboration between industry, universities and researchers and ANSTO across all its sites.
Importantly, the amendments will only empower ANSTO to make available its expertise and equipment or lease its land and facilities to parties that have a science, innovation, high-tech-manufacturing or technology-development focus and related amenities, and not for unrelated general retail, office or residential purposes. This is not about some sort of lateral jump into property development or anything else. This is very much about activities which are complementary to and consistent with the charter of ANSTO.
No additional powers have been granted under this bill with regard to defence and national security; that is a furphy. There was a 2006 enactment which addressed the threat of dirty bombs, which is a separate matter.
The other point I would make is: if you're asking about the sorts of companies which will be permitted by the bill to co-locate with ANSTO, they could include advanced manufacturing companies—such as robotic development companies or high-end medical manufacturing companies—technology development companies and engineering companies. Currently, such companies may only co-locate with ANSTO for the period of time that they're directly working with ANSTO.
The proposed ANSTO innovation precinct will co-locate and crowd in scientific partners, knowledge-intensive businesses, high-tech industry, and science, technology, engineering and maths or STEM graduates and medicine graduates around Australia's centre of nuclear capabilities and expertise. Close synergies and collaboration between our publicly-funded research agencies, such as ANSTO, our Australian universities and businesses and industry are a national priority. They are the key to driving Australian innovation. And geography does matter for some innovation. Precincts can facilitate the sorts of collaborative relationships Australia needs if it's to innovate and grow. As a parliament, we want to remove any impediment that may restrict or discourage these relationships. This bill does just that. Physical proximity can be very important in these things, and I have a group at the moment looking at the university precinct strategy to see how we maximise the prospects of being able to use our universities as hubs when it comes to building this sort of academic, industry and research organisation collaboration.
ANSTO already contributes so much to the Australian community. On average, one in two Australians will benefit from the lifesaving nuclear medicine produced by ANSTO. ANSTO's landmark and national research infrastructure, including the OPAL research reactor, the Australian Synchrotron and the Australian Centre for Accelerator Science, are a crucial part of our scientific, social and economic base. They enable scientists to tackle some of the most pressing challenges, in areas as diverse as human health and the environment and solving complex problems for industry. Critically, they maintain a home-grown, highly skilled workforce and help sustain Australia's competitiveness and global relevance.
One of the parts of this I'm particularly gratified about is that the intentions are to have not only a technology park but also a graduate institute and to have the first nuclear science and technology incubator in the world. These are big things, and we can do them because we've got world-class facilities like these. I reject the idea that there is any other purpose to this than promoting Australian science and innovation at the highest levels. I reject some of the claims that have been made by the Greens and others in this regard. There is much prejudice in this debate. People bring ideological blinkers to these debates. I believe in evidence based policymaking. I believe that what ANSTO is doing is good, within the remit it's been given. This bill will allow it to do other good things in association with Australian companies, Australian students and other researchers, as time goes on. The adoption of this bill will allow ANSTO to deepen its impact and reach for the benefit of Australian innovation, education, business and industry. There are no direct financial implications from this bill. As I said before, this is about the powers of ANSTO; it clarifies the powers of ANSTO to do all of this. I commend the bill to the Senate.
The PRESIDENT: The question is that the bill be read a second time.
The Senate divided. [20:35]
(The Acting Deputy President—Senator Bernardi)
Third Reading
The ACTING DEPUTY PRESIDENT ( Senator Bernardi ) (20:37): 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 SINODINOS (New South Wales—Minister for Industry, Innovation and Science) (20:37): I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
BUSINESS
Rearrangement
Senator SINODINOS (New South Wales—Minister for Industry, Innovation and Science) (20:38): I move:
That government business order of the day no. 4, Export Finance and Insurance Corporation Amendment (Support for Commonwealth Entities) Bill 2017, be postponed till the next day of sitting.
Question agreed to.
BILLS
Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017
Second Reading
Consideration resumed of the motion:
That this bill be now read a second time.
Senator CAMERON (New South Wales) (20:38): Is it any wonder that this bill proposed by Minister Cash is so deficient? Her former colleague, Bruce Billson, was trousering money from the Franchise Council of Australia while he was still a member of parliament. The former coalition small business minister is the principal business lobbyist opposing the bill, using all of his experience, contacts and influence to diminish the effectiveness of this bill. Billson has asserted that he regularly updated his interests and his declarations. However, despite being in this highly compromising position, he somehow failed to disclose his position or salary at that time. It absolutely stinks. It's as rotten as it gets. Questions surrounding the influence Mr Billson had on the Turnbull government's vulnerable workers legislation abound. The Franchising Council of Australia is a powerful business lobbyist that wants the bill killed. Senator Cash and Mr Billson need to explain what conversations they or any of their staff had in relation to this bill. Mr Billson needs to explain what discussions he had with colleagues while in the parliament regarding underpayment and exploitation by franchisees. Mr Billson needs to outline what pressure he put on the Minister for Employment, Senator Cash.
The vulnerable workers legislation is weak and utterly deficient. It will not effectively hold to account businesses that are doing the wrong thing. Revelations about Bruce Billson's compromised position as head of the Franchising Council of Australia reveal why. Perhaps the government could turn its attention away from relentless ideological attacks on unions and instead canvass Mr Billson's suspicious position and dealings with the government regarding this deficient bill.
Despite the 7-Eleven scandal coming to light more than two years ago, the government delayed this bill. While there are a number of serious questions surrounding Mr Billson's compromised and covert conduct, and his influence over the bill, what remains crystal clear is that the Turnbull government doesn't take examples of systemic worker exploitation seriously. It pays lip service to the exploitation of workers, while turning all of its resources against working people and their unions.
The Fair Work Amendment (Protecting Vulnerable Workers) Bill amends the Fair Work Act to increase penalties for what are described as 'serious contraventions'—conduct which is deliberate and a part of a systemic pattern of conduct by one or more persons relating to contraventions of prescribed workplace laws. I note at this point that the increase in penalties falls short of what Labor committed to at the last election. There are increased penalties for employer record-keeping failures. The bill makes franchisors and holding companies responsible for underpayments by their franchisees or subsidiaries where they knew, or ought reasonably to have known, of the contraventions and failed to take reasonable steps to prevent them. The new responsibilities will only apply where franchisors and holding companies have a significant degree of influence or control over their business networks, and the franchisor or holding company may raise a defence of taking reasonable steps to prevent a contravention. The bill expressly prohibits employers from unreasonably requiring their employees to make payments—that is, demanding that a proportion of their wages be paid back in cash. It gives the Ombudsman and employees at SES level the power to compulsorily question persons as part of an investigation into breaches of the Fair Work Act.
The bill falls significantly short of the suite of legislative measures required to properly address the breadth of worker exploitation we have seen occurring far too frequently across the country. For example, it does nothing in relation to stopping sham contracting or phoenixing to avoid wage liabilities. It doesn't reform the Fair Work Act to strengthen protections for workers who want to exercise their workplace rights—for example, querying whether they are an employee and not an independent contractor. It doesn't make it easier for workers to recover unpaid wages, or strengthen protections for foreign workers who are exploited because of their immigration status. It doesn't address the proliferation of dodgy labour hire companies. Labor moved a private member's bill back in March 2016 and have policies which do address all of these issues. Yet the government haven't done anything at all on these matters. They like to pretend that they want to protect workers, but they don't.
This bill purports to make franchisors and holding companies responsible for underpayments by franchisees or subsidiaries. This is aimed at responding to the 7-Eleven scandal, but there are flaws with the new civil liability offence in this bill, which shows that the government's response is weak. The government's offence will not reverse the onus of proof, which means that it will remain very hard for workers and the Fair Work Ombudsman to successfully prosecute franchisors. Many large businesses do not use a franchise model and will therefore not be liable, and businesses that use a franchise model are likely to move out of that model or design their business relationships in order to escape prospective liability under the offence. Labor's amendments address all of these flaws. They are essential to giving this bill real teeth. The government must support them if it truly wants to stamp out underpayments across our economy.
The second area is the proper use of coercive powers for investigations into exploitation of vulnerable workers. Labor has led the government every step of the way in proposing measures to protect vulnerable workers. Labor wants the Fair Work Ombudsman to have all necessary powers to pursue unscrupulous employers who exploit their workforce. There is a clear need for the ombudsman to have the ability to use coercive questioning powers when investigating employers who underpay their workers, but, as with any coercive powers, they must be subject to an appropriate oversight and used sparingly. Labor's amendments are entirely consistent with the purpose of the new powers and with the government's stated reason for introducing them.
As drafted, the bill provides for the Fair Work Ombudsman's coercive questioning powers to be exercised in relation to any Fair Work Ombudsman investigation, which includes investigations into industrial action taken by workers and their unions. In contrast, the explanatory memorandum more narrowly describes the purpose of the coercive powers as 'strengthening the evidence-gathering powers of the Fair Work Ombudsman to ensure that the exploitation of vulnerable workers can be effectively investigated'. It's about investigating employers. The government's public statements have described the bill as introducing better investigatory powers relating to the exploitation of vulnerable workers. So both the explanatory memorandum and the government's public statements say the bill is for this purpose, but the bill is actually using a wider range of powers for wider purposes than the government has made public. There is no evidence that these new coercive powers are legitimately needed for any purpose other than gathering evidence against exploitative employers.
The ombudsman's evidence before the Senate employment committee focused on strengthening her power to conduct investigations into systemic underpayments. She specifically used 7-Eleven as an example of where the absence of coercive powers restricted her ability to properly investigate. Further, in her submission to the Senate employment committee, the Fair Work Ombudsman specifically linked these coercive questioning powers to investigations of new provisions in the bill.
There is, however, strength to the concern that, with coercive questioning powers in its arsenal, this government would direct the Fair Work Ombudsman to put more of its resources into investigating union activities. This is the lived experience with the ABCC and the ROC. The Prime Minister and Senator Abetz directed Fair Work Building and Construction on 12 November 2013 to transfer wage compliance functions to the Fair Work Ombudsman, despite legislation requiring Fair Work Building and Construction to deal with wage compliance. So there you have it, how this government operates; it doesn't care about workers being exploited. This bill will not resolve the problems. The then Prime Minister, Tony Abbott, and the then minister, Senator Abetz, directed the Fair Work Building and Construction not to pursue breaches of legislation against employees. That wasn't their job, according to the two ideologues and extremists when it comes to the trade union movement.
We need to limit the use of proposed coercive powers to investigations into underpayment of wages and allowances. Our position is consistent: coercive powers should be used sparingly, and only where justified. If the government does not support Labor's amendments to put in AAT oversight and require the ombudsman to only use their coercive powers for investigations into the exploitation of vulnerable workers, then they will be exposed. They will be exposed in their pretence that they care about workers in this country. They will be exposed in their attempt to have yet another agency prosecute the government's ideological crusade against working people and their unions.
This case study, taken from the Fair Work Ombudsman's submission to the Senate employment committee inquiry into this legislation, shows why Labor's amendment, extending liability to where companies use labour hire and along the supply chain, is necessary. It's also an example of the type of investigation the Fair Work Ombudsman needs coercive questioning powers for—that is, an investigation into the exploitation of workers. They said:
Over a number of years the [Fair Work Ombudsman] received intelligence that site managers employed by Baiada were actively involved in employing migrants to work excessively long hours, paying them below minimum entitlement rates in cash, and threatening workers with termination when they complained.
The Baiada Inquiry was principally concerned with identifying the nature and terms of labour procurement through the Baiada Group’s contracting networks. Understanding in detail the characteristics of the labour arrangements was critical to identifying whether the arrangements comply with the [Fair Work] Act and who may be responsible for non-compliance with workplace laws.
The [Fair Work Ombudsman] found that principal contractors in the labour supply chain were related to the directors of Baiada and were using the supply chain to avoid regulatory obligations. False records had been created and produced by the contractors in response to a [notice to produce] issued by the [Fair Work Ombudsman], and little significant or meaningful documentation was provided regarding the nature and terms of its contracting arrangements. Baiada also denied inspectors access to its three sites in [New South Wales] during the course of the Inquiry which prevented inspectors an opportunity to observe work practices or to talk to workers about work conditions, policies and procedures.
The lack of cooperation from the Baiada Group, including failure to provide accurate contact details for contractors, lengthy delays in providing requested records and not consenting to Fair Work inspectors entering worksites, along with the failure of contractors to update business registration records in contravention of the Corporations Act 2001, presented challenges in contacting directors and serving notices issued by the Fair Work inspectors under the [Fair Work] Act.
Due to the negligible records produced and the [Fair Work Ombudsman's] reliance on voluntary participation in interviews, the [Fair Work Ombudsman] was unable to effectively account for the hundreds of thousands of dollars that moved down the supply chain, conduct proper interviews with employees or compel those with information to speak with inspectors.
Despite volumes of intelligence received by the [Fair Work Ombudsman] regarding Baiada's alleged involvement, no evidence sufficient to put before the court was recovered, due to the limitations on the [Fair Work Ombudsman's] investigative powers.
That's what the Fair Work Ombudsman said.
Now, I am clearly of the view that if you really want to deal with exploitation against working people, then the situation at Baiada needs to be dealt with. This legislation does not cover that range of circumstances and will not allow the Fair Work Ombudsman to deal with it effectively. It's concentrating on the franchising area, and I would appeal to Senator Xenophon and his team to stop being a rubber stamp on this government's attacks on workers' rights and support Labor's amendments. That's what will protect workers: our amendments as they are on this bill before parliament.
Senator PATERSON (Victoria) (20:55): I am pleased to have the opportunity to rise tonight to contribute to this debate on the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017, although I must say that I am sad that it comes at the expense of watching what I understand is a fascinating episode of the Four Corners program tonight on the Greens political party. But I will look forward to downloading it later on iview and enjoying it in its full glory.
Before I turn to the main part of the bill tonight, I want to take the opportunity to respond to some of the observations that Senator Cameron made in his speech on the bill just then. I particularly want to focus on what I regard as his unfair and inappropriate attack on the character of Bruce Billson, the former minister and member in the other place, and also his implied criticism of the character of Senator Cash, the minister responsible for this legislation. It was a highly personal attack that made what I regard as very serious allegations and implications of corruption. I think he did even use the word 'corrupt' once in his speech. He certainly alleged that Mr Billson's advocacy on this bill was covert in some way, which I think is not supported by the facts.
It is certainly true that Mr Billson failed in his obligation to update his register of interests appropriately when he was a member of parliament. I take my own register of interests very seriously, as all senators and members should, and Mr Billson has apologised for what was an oversight, as he should. It's not acceptable to fail to update your register of interests. But to suggest that Mr Billson's appointment to the Franchise Council of Australia was in some way a secret flies in the face of the fact that a press release was issued, announcing his appointment to the Franchise Council of Australia. No-one was in any doubt about Mr Billson's involvement or interest in this matter, either in his final few months as a member of parliament before he retired or subsequently after his retirement from parliament and beginning his advocacy on behalf of the Franchise Council.
It was even less reasonable and even more unfair for Senator Cameron to go on to imply that Mr Billson had somehow had undue influence over the minister in the drafting of these laws. Senator Cameron has obviously missed the very strong criticism that the Franchise Council has made of the proposed laws—the very strong disappointment in these laws that the Franchise Council, along with some other business organisations, has made. There is no evidence in any way, shape or form that the minister was inappropriately or unduly influenced by the advocacy of Mr Billson. Of course, it is completely fair and appropriate for franchises or any other community organisations or business associations to have their views represented in public debate and to make the case for their point of view on the legislation, and for government to consider their point of view and, where appropriate and where the government agrees, to incorporate their point of view into the subsequent legislation. So I just want to underline what I thought was a very unfair and unjust personal attack on the minister and Mr Billson.
Senator Cameron also lamented that this bill does not reverse the onus of proof, as if that were a negative thing. I could not disagree more strongly. It is a foundational principle of the rule of law that one is innocent until proven guilty and not otherwise. As far as possible, and as often as we can, I think that principle should be upheld. If it is ever to be abridged in legislation I think it should require a very great and extraordinary justification, because it is an abrogation of the rule of law. My former employer, the Institute of Public Affairs, publishes a regular survey on the number of instances that this legal right has been overturned in the past by legislation, and it is a troublingly large number of occasions. I particularly point out that it is most often reversed in the context of workplace relations, and very often, within that context, is aimed—not exclusively, but predominantly—at employers, and I think that that is something which, as far as possible, we should strive not to do.
Turning now to the substance of the bill before us: this is yet more evidence that the Turnbull government takes very seriously the issue of exploitation of workers. Anybody who has read about or heard of or is aware of the exploitation of workers at a number of franchises—including 7-Eleven, most spectacularly, but also Muffin Break, Gloria Jean's, Subway, Caltex, Domino's and Pizza Hut—would agree that the laws which currently regulate this issue are inadequate and that they do not give sufficient capacity to the Fair Work Ombudsman, among others, to address this issue.
One thing was missing from Senator Cameron's speech—unless he made the point in his initial remarks that he was continuing tonight and I missed it, and I apologise if I have. But one thing that I didn't hear in his speech was the fact that of course this government is amending the previous government's Fair Work Act. These breaches have occurred under laws not drafted by this government; in fact, the laws were drafted over the objections of the party of which I'm a member. The laws were drafted by the former Labor government. They passed during the Rudd prime ministerial years, and were authored, I understand, by former Prime Minister Julia Gillard. It is under those laws that these contraventions have taken place. Laws that were authored for Labor, and with the benefit of union assistance, have allowed these breaches to take place. So for some unions and for some Labor senators—as they have in this debate—to imply that the failure of these laws, which has occurred on our watch, is in some way the coalition's fault rather than their own, given that it was they who authored the laws, I think is a great stretch and discredits them. They would do much better to admit that the laws which they drafted were inadequate, that the powers that they gave their Fair Work Ombudsman were insufficient, that these breaches have occurred due to their laws and not anyone else's, and that this government is taking the right and appropriate steps to address their failure to draft appropriate laws to prevent these instances of abuse of workers taking place.
Workers are of course the primary victims of underpayment, and perhaps the most sympathetic victims. They deserve redress. But of course they are not the only victims. Law-abiding businesses that pay their workers a fair and appropriate rate of pay are also victims, because they have to compete against businesses that are not complying with the law and are evading their legal responsibilities, and that makes it harder for those law-abiding businesses to exist and to thrive. This bill addresses not just those abuses of workers but the associated abuse of law-abiding businesses, and I think that is one of the reasons why the bill deserves strong support.
Of course taxpayers, in a sense, are also victims of this law. When workers are underpaid, they clearly won't be paying their full rate of tax, and that is an unjust and unfair thing for all of us to bear as a community. So there are many reasons why this issue needs to be addressed, and there are many reasons why the Turnbull government is taking action to address what is an abuse of power—as we have demonstrated we are willing to do. Whether it is union bosses or employers or anyone else intimidating people and failing to comply with the law, we will take action to address those contraventions.
There are a number of key elements of this bill—in particular, the increase in the number of penalties for serious contraventions of the payment related protections in the Fair Work Act. This applies particularly when those contraventions are systematic and deliberate. This is not intending to target accidental or inadvertent contraventions. But systematic and deliberate contraventions do deserve substantially increased penalties, and there will be a tenfold increase in those penalties.
Importantly, the bill will also target and increase penalties for record-keeping failures—failures to keep appropriate records. It is not sufficient for an employer who may not have been paying their employees the correct rates of pay to plead ignorance, or to plead that they have insufficient records and that they are unable to go back and check whether their workers were paid the right amount. It is a fair and reasonable thing to ensure that employers are keeping adequate and up-to-date records of their payments to their employees, so that, if allegations of systemic underpayment are raised in the future, those allegations can be appropriately investigated and acted upon.
This bill will also outlaw the practice of cash-back and other coercive behaviour by employers, where employees may, in essence, be paid correctly but, in reality, not be paid correctly because they are forced by their employer to repay part of their wages. It seemed to me a fairly extraordinary thing that this practice was not already unlawful, but this government is addressing this issue to ensure that it is unlawful. The bill will hold franchisors and holding companies responsible for underpayments where they should have known about them but failed to take reasonable steps to prevent them.
The bill strengthens the investigation of underpayments by giving the Fair Work Ombudsman effective evidence-gathering powers on par with ASIC and the ACCC and by outlawing the provision of false and misleading information or hindering and obstructing inspectors who carry out investigations into compliance with the Fair Work Act. It builds on a record of action by the Turnbull government to address these issues to protect other vulnerable workers, including the establishment of the Migrant Workers' Taskforce. It will boost funding to the Fair Work Ombudsman by $20 million to ensure that the regulator has the resources to investigate and prosecute employers who exploit workers.
The government established Taskforce Cadena in June 2015—a joint task force between Border Force and the Fair Work Ombudsman—to target and disrupt criminals who are organising visa fraud, illegal work, and the exploitation of foreign workers. The Senate Standing Committee on Education and Employment heard particularly disturbing evidence about these practices, and that's why the Turnbull government has taken action to address that. A valid pay slip, as a proof of paid work, will be required before a second working holiday visa will be granted to a temporary migrant worker. The bill outlaws the payments to sponsors of foreign workers through making it a criminal offence for employers and visa applicants to solicit and receive a payment in return for visa sponsorship. Finally, funding will be provided to enforcement bodies to ensure employers comply with obligations as sponsors of skilled visa holders.
I'm a member of the Senate Standing Committee on Education and Employment, and the committee has produced a very comprehensive and, I think, helpful report into this bill. I mention that not in any way to take credit for Senator McKenzie's excellent work as chair. As is always the case, she deserves the lion's share of the credit for a comprehensive report and for what, I thought, were some very reasonable and sensible recommendations as to how the bill could be improved to ensure that the words of the bill reflect the intention of the bill. The committee made a range of recommendations including that the government should consider amending the bill to ensure that the conduct which is being caught is the exact conduct which is intended to be caught and no greater. It does not impose unreasonable or unfair burdens on franchisors where they have a less direct relationship or less direct oversight over their franchisees.
I understand that there will be a number of amendments proposed, particularly by crossbench senators, which are in part inspired by the recommendations of the committee, that will seek to give effect to the committee's recommendations. I look forward to hearing about those amendments later on during the debate.
I'd just now like to turn briefly to some of the stories of exploitation that we've heard so far that have led the government to take this action to address this issue. I should, in particular, pay tribute to the journalists who have done an excellent job in uncovering, exposing and demonstrating the systemic nature of these underpayments. Particularly, I should note Adele Ferguson of the Fairfax papers, who has worked very hard to identify, expose, document and catalogue these abuses. It shows the very important role that investigative journalists play as part of a civil society. We cannot rely on government alone or, indeed, any other community organisation to ensure that laws are enforced and adhered to. A powerful fourth estate, if it fulfils its role, can contribute to that very successfully.
Ms Ferguson in conjunction with Mario Christodoulou exposed in a very powerful way in the Sydney Morning Herald recently, in particular detail, the systemic way in which Domino's Pizza underpaid and exploited its workers. No-one could think, having read this report, that these were accidental oversights, which I accept absolutely do occur, because complying with our industrial relations system is not a straightforward thing, particularly for small business. But for a large business or large franchise, such as Domino's, there is no excuse for not complying with the law, and exposing it being done on such a systemic basis was a great service by Ms Ferguson.
A recent report, again in The Sydney Morning Herald, by Anna Patty, catalogued just how extensive we now know the underpayment to be at 7-Eleven, in particular, noting that the compensation bill for 7-Eleven workers had climbed over $110 million. That is an extraordinary amount, which averages about $39,000 for each of the 2,832 claims made by workers who say they were underpaid. To have underpayment with that number of workers and on that scale is unconscionable and supports the action the government is taking to fix this law.
I look forward to hearing the contributions of other senators in this debate. I believe the government has struck the right balance in addressing what is clearly a demonstrated issue of concern to the community and to workers but also doing so in a way that is precise and targeted, addresses the issue at hand, and does not stray into wider issues or have unintended and inadvertent effects. So I commend the bill to the Senate.
Senator POLLEY (Tasmania) (21:11): I rise to speak on the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017. I welcome the opportunity to speak on this bill, because the protection of vulnerable workers is something that we have been calling on this government to do for years and years. Under this government's watch, there are still scores and scores of examples of workers being exploited by their employers. There've been many high-profile cases, and we've seen in the media reports on cases like 7-Eleven and Pizza Hut happening right under the noses of those opposite.
Who would have thought that we would still be here telling these tales in 2017? What has the government been doing about it? Basically, very, very little. More than a year ago, with much fanfare, the government announced it would take action to crack down on workers' exploitation. But, despite multiple promises to deal with this urgent legislation, the Turnbull government have dithered and delayed, proving their callous disregard for workers who have been exploited.
This bill goes some way to deal with some of the exploitation issues concerning vulnerable workers across the country, but it falls significantly short. I will get to this in a moment. We know those opposite do not take workers' exploitation seriously, which is why Labor has put forward amendments to address the deficiencies with this bill.
I'll touch briefly on what this bill does. It amends the Fair Work Act to increase penalties for serious contraventions of prescribed workplace laws, increase penalties for employer record-keeping failures, and make franchisors and holding companies responsible for underpayments by their franchisees or subsidiaries in instances where they knew, or ought to have known, and failed to take reasonable steps to prevent them—a measure that falls short. This bill also seeks to prohibit employers from demanding that a proportion of employees' wage be paid back in cash. Finally, this bill seeks to give the Fair Work Ombudsman and employees at the SES level the power to compulsorily question persons as part of their investigation into breaches of the Fair Work Act.
As I just said, this is a start, but it isn't enough. It's good to have the chance to speak on this bill tonight, because protecting workers' rights, and the government's failure to act on workers' rights, is something Labor has strongly campaigned on for a long time. The reality is that Labor has led the government every step of the way in proposing measures that will actually protect vulnerable workers. Those opposite have had to be dragged to the table to bring forward any measures to address exploitation of vulnerable workers. This legislation has been a long time coming, but unfortunately what we have before us tonight is a bill that falls short of what is actually needed. It doesn't go anywhere near far enough. The measures in this bill don't go far enough to address the extent of workers' exploitation, and we have seen, really, some terrible examples of shameful abuse of workers under this Liberal government. The bill falls short of Labor's suite of policies and legislative reforms that we announced 12 months ago, well before this out-of-touch Liberal government even thought about protecting workers. The bill as it stands doesn't even come close to the policies Labor took to the federal election last year to combat sham contractors, license labour hire companies, reform the Fair Work Act to strengthen protections for workers, and criminalise employer conduct that involves the use of coercion or threats.
The other serious shortfall of the government's bill, which really highlights their inability to address the issue of worker exploitation, is their refusal to protect penalty rates. There is absolutely nothing in this legislation for those who rely on penalty rates, who are some of the lowest-paid and most vulnerable workers in Australia. But is this really such a surprise? I don't think so. This is a Prime Minister who has thrown his support behind cuts to penalty rates at every opportunity. He owns the decision to cut penalty rates.
You have to wonder whether the Turnbull Liberal government actually cares about protecting workers at all. Instead of trying to defend everyday workers from having their wages cut, they want to give a $50 billion tax cut to big business and the banks. If this out-of-touch government really cared about protecting workers, 700,000 Australians, including 40,000 Tasmanians, would not have lost their penalty rates last month. If those opposite really cared about vulnerable workers, the threat of penalty rate cuts extending to other industries and other low-paid workers would not exist. If this government really cared about vulnerable workers, the Minister for Women, Michaelia Cash, wouldn't have thrown her full support behind the cuts to penalty rates, which will disproportionately impact on women. How out of touch can you get? Are you not moving around your electorate? Do you not listen to people to see how far the inequality in this country has actually gone? This government just doesn't get it, and I'm not sure they ever will.
During question time on 30 March this year the Prime Minister said, 'Everything we're doing is creating jobs.' I'm not sure whether he was being sarcastic or is just living in a different country, because in the last 12 months there's been more than 700,000 Australians having to hold down a second job in order to make ends meet. This is an increase of 9.2 per cent over the past six years. Employment growth has halved and remains well below trend. Full-time jobs have declined, with job creation dominated by part-time work. Underemployment is at a record high. More than 1.1 million Australians want more work but can't find it. Wage growth has fallen to new record lows. Inequality is at a 75-year high. And apprentice numbers are still spiralling downwards. There are now only 265,000 apprentices in training compared to 413,400 in September 2013.
In a media release on 1 August, Minister Cash said, 'The Turnbull government is getting on with the job of helping more young Australians into work.' Well, you aren't pulling the wool over the eyes of our minister. I mean, all you have to do is go to regional areas around this country, go to our home state of Tasmania, to know the reality about the high level of unemployment among our youth. Under this Liberal government, the economy is not working as it should. It's not working in the interests of everyday working Australians. Too many people are working harder for less. Too many people are living from pay cheque to pay cheque. Too many people have less money in their pay packet and less security in their job. Too many people are underpaid, under-represented and, in many cases, frightened of complaining. The digital divide, all the barriers to quality education, rising house prices, escalating energy prices, older workers being displaced—the list goes on and on.
But despite all of this the Prime Minister does nothing, because he leads a government which cares more about protecting the privileges of the top end of town than it does about making life easier for everyday Australians. And we've seen today in that other place that the Prime Minister's only motivation in relation to jobs is to protect his Deputy Prime Minister, Barnaby Joyce, to protect his own job. Any other Prime Minister would have asked their Deputy Prime Minister to step aside. That's what a leader would have done; that's what a strong leader would do.
So it doesn't matter how many times the Prime Minister tries to tell us that he's a strong leader. He's not strong at all. Perhaps he should keep telling himself—perhaps he should stand in front of the mirror and tell himself, 'I am a strong leader, I am a strong leader.' The Deputy Prime Minister, Mr Barnaby Joyce: if he were the calibre of a good man, he would stand aside. He would stand aside until the issue is resolved by the High Court. But the dysfunction and the chaos within this government just rolls on and on. Really, it's like a bad soap opera; it just gets worse and worse. The characters aren't even good characters!
The Prime Minister takes every opportunity to tell Australians that he's delivering and that he's keeping his promises, but all he's achieving is absolutely nothing. The Australian community see right through him. They see the dysfunction; they see the chaos in this government. When the Deputy Prime Minister has called into question whether or not he is eligible to sit in the House of Representatives and he continues to sit there and continues to vote, then that says so much about the character, the honesty and the integrity of this government.
But tonight Labor has been and will be putting forward some relevant amendments that will try to make the most out of this bill. If you look at the facts and the figures, the Prime Minister is taking Australians nowhere, and it’s the people he's supposed to represent who have to live with the consequences of a chaotic and dysfunctional government. What is crystal clear is that the Turnbull government doesn't take workers' exploitation seriously. This government isn't interested in the wellbeing or the safety of workers; it's interested only in quick political wins.
I'm glad we're finally dealing with this bill tonight, because Labor has fairness and workers' rights at the core of our mission. It's part of our social fabric and it's part of Labor's DNA, which is in stark contrast to those on the opposite side of the chamber. We know that if the government were serious about tackling the horrendous examples of workers' exploitation then they would have taken action before the winter break like they said they would. What they have proposed in this bill is inadequate. There's a lot more work to be done, which is why Labor is moving amendments to properly address workers' exploitation. So I urge those on the other side of the chamber and on the crossbench to support our amendments.
We on this side of the chamber will continue to fight to protect vulnerable workers. We will put their interests ahead of ours—unlike the Prime Minister, who only puts his own job and the job of the Deputy Prime Minister, Barnaby Joyce, before Australian workers.
Senator WILLIAMS (New South Wales—Nationals Whip in the Senate) (21:23): I just had to leave my office to come into the chamber to speak on this very important piece of legislation, the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017. It was disappointing, actually, to leave the television, where I was watching Four Corners—
Senator McGrath: Tell us more re: Four Corners!
Senator WILLIAMS: It was former Senators Bob Brown and Christine Milne and state MLCs in NSW and the Greens smashing Senator Rhiannon something terrible. But anyway, I've come in here on a more important issue only to find Senator Polley saying some crazy things over there, talking about penalty rates.
It was the Labor Party in government that formed Fair Work Australia. In fact, they even appointed the commissioners. They set up the whole system. They appointed the review of the penalty rates. So they set up the umpire, the umpire made a decision to shave some of those penalty rates on Sundays and public holidays and we get the blame for it. Unbelievable!
We get blamed for what they do! I mean, you're always right. Even when you're wrong, you're right! That's your system, Senator Cameron, and you go on and blame the government. Senator Polley was talking about high regional unemployment. It is quite amazing where I live.
The ACTING DEPUTY PRESIDENT ( Senator Reynolds ): Senator Polley on a point of order?
Senator Polley: It is in the standing orders that you should refer to senators by their title.
The ACTING DEPUTY PRESIDENT: I believe that Senator Williams had referred to senators—but I would remind Senator Williams. Senator Polley, I'll take you at your word; however, I certainly did not hear him refer to anybody else but by their title.
Senator WILLIAMS: I referred to Senator Polley. Does she have another title? If she does have, I'd be keen to learn about that. So Senator Polley takes the point of order. Regional jobs: it is quite amazing where I live that we have Bindaree Beef our local abattoir. We have plenty of young unemployed. Why don't they work at the abattoir? We rely on Brazilian and Filipino visa workers to carry out the work. Why aren't the locals working there? Would it be the fact that some of them don't want to work at an abattoir? Did some get a job there and when they rolled up they failed the grog test or the drug test? You only have to talk to many abattoir owners who rely so much on backpackers et cetera coming in to do that work. We had this big debate about the backpackers tax. We've 730,000 people unemployed in Australia, can't they pick fruit? Can't they help with the vintage in the grape season when the wine grapes are being picked? Can't they work in the abattoirs? Can't they shear sheep? Unbelievable.
Back to the bill in front of us—this is a very important amendment. Could I commend my good friend, Adele Ferguson. My wife, Nancy, and I are very good friends with Adele and her husband, Christian, and their daughter, Emma. Adele tipped me off months before she did the Four Corners story on 7-Eleven. What a disgusting situation it was: youngsters out here on student visas. On none of those visas could they work more than 20 hours per week so 7-Eleven franchisees employed them and worked them for 40 hours a week, but at half-pay. Instead of paying them $17, $18 or $19 an hour, or whatever the rate was—perhaps more on a casual rate—they paid around $10 an hour in many cases. Then they said to those students, 'If you dob us in for underpaying you, we're gonna go to the government and we're gonna dob you in for working more than 20 hours a week, and we'll have you kicked out of the country.' What a good blackmailing system that was to use and abuse workers. I've said it a thousand times: life is about fairness. People should be treated fairly, with a fair day's work for a fair day's pay. It's been around all my life that saying. Congratulations, Adele Ferguson, for highlighting the rorting that 7-Eleven carried out in many of their franchises on many of those workers, and their absolute abuse of them.
Another very respected person in Australia, Mr Allan Fels, was appointed the adjudicator to clean this mess up. It wasn't long before millions and millions of dollars were being paid by 7-Eleven. And what did they do? They sacked Allan Fels. I wonder why? Because a decent man was doing the right thing, that's my suspicion. And so it goes on. There is not only 7-Eleven, but also Muffin Break, Gloria Jean's, Subway, Caltex, Domino's, and Pizza Hut franchises. That's just some.
I've said it before in this place: when the Parliamentary Joint Committee on Corporations and Financial Services, which I'm part of, completes our whistleblowers inquiry and our inquiry into life insurance, I'd like to see the committee do an inquiry into franchises and the absolute abuse of their workers and the tactics they use to cheat workers. Why did 7-Eleven underpay their workers? Was it because the actual chiefs of 7-Eleven were not giving a fair deal to their franchisees? Were they forced to actually cheat to try and stay afloat? These are questions we need to have answered, and I think a parliamentary inquiry by the PJC on Corporations and Financial Services could have a good look at that and perhaps find more answers to see if we need more amendments later on.
The conduct by certain businesses is fuelled by inadequate penalties and ineffective laws, which fail to deter lawbreaking and make worker exploitation difficult for the regulator, the Fair Work Ombudsman, to prove. Underpayment of workers is unfair for workers, but also for competing businesses who do the right thing and face higher costs because they are complying with the law. If you are a convenience store other than 7-Eleven and you're paying the correct salary or the correct rate of pay to your employees, you've got certainly an unfair competitive disadvantage to those who are cheating the system. It is so wrong. When someone abuses their power, whether it's union bosses intimidating small businesses or dodgy employers exploiting vulnerable workers, the Turnbull government will take action. I'm pleased that is exactly what we're doing here now.
Senator Cameron: What about crooked farmers?
Senator WILLIAMS: Crooked farmers? Never heard of one! Senator Cameron is saying in his interjection, 'What about crooked farmers?' All the farmers I know have been the honest, hardworking people who do such a great job not only feeding all of Australia but millions of people around the world as well, and who suffer some terrible times. Luckily, with good irrigation equipment and good pumps, these days they can do well.
This bill will amend the Fair Work Act to increase penalties by 10 times for serious contraventions of payment related protections in the Fair Work Act, which will apply when contraventions are systemic and deliberate. The bill will also raise penalties for record-keeping requirements to make them consistent with penalties for underpayment of workers. The bill will outlaw cashback and other coercive behaviour by employers where employees are paid correctly but then forced by their employer to repay part of their wages. How is that for a cheating system? They say, 'The award's $20 an hour and we'll pay you $20 an hour, but here's the deal: you give us $8 an hour back for giving you a job.' What a disgusting treatment! It will hold franchisors and holding companies responsible for underpayments where they should have known about them but failed to take reasonable steps to prevent them, as in the case of 7-Eleven and no doubt more to come. The amendments will strengthen the investigation of underpayments by giving the Fair Work Ombudsman effective evidence-gathering powers similar to that of ASIC and the ACCC and outlawing the provision of false or misleading information and the hindering and obstruction of inspectors who carry out investigations into compliance with the Fair Work Act. Those powers will be welcomed by the ombudsman and are, as I said, similar to those of ASIC and the ACCC.
A point on building on a record of protecting vulnerable workers: the bill builds on steps already taken by the government to protect vulnerable workers, including establishing the Migrant Workers' Taskforce chaired by Professor Allan Fels—a man who I have been privileged to meet on several occasions, and who is a thoroughly honest, decent man, in my opinion, who will do a great job of chairing that task force—to target employers who exploit migrant workers and to continue to monitor the progress of 7-Eleven in rectifying workers' underpayments. Hopefully, the compensation is going out to those workers with interest on top. We will be boosting funding to the Fair Work Ombudsman by $20 million to ensure that the regulator has the resources to investigate and prosecute employers who exploit workers. That is another good thing. There is no point having a good oversight cop on the beat without the funding for them to carry out their duties; they need to be resourced well. Taskforce Cadena was established in June 2015. This is a joint task force between Australian Border Force and the Fair Work Ombudsman to target and disrupt criminals organising visa fraud, illegal work and exploitation of foreign workers. Also, we are requiring a valid payslip as proof of paid work before a second working holiday visa will be granted to temporary migrant workers. The amendment outlaws payments to sponsors of foreign workers by making it a criminal offence for employers and visa applicants to solicit or receive a payment in return for visa sponsorships. That's good thing to bring the heavies down on those people who wish to cheat in that way. We are funding enforcement bodies to ensure that employers comply with their obligations as sponsors of skilled visa holders.
As I said, the first person to bring this to the public arena was Adele Ferguson, with her Four Corners story, and I commend her for her great work. It is simply wrong that employers use all sorts of bribes, threats or whatever to threaten workers for one reason other another, and then underpay them or not pay them by the award. It is disgusting, and I've known those companies that will no doubt be under the spotlight when we get this inquiry going, and I hope we do: not only 7-Eleven but Muffin Break, Gloria Jean's, Subway, Caltex, Domino's and Pizza Hut franchises.
I bet you there are more people cheating, because these students who come here, especially the students, have to work and get a job to try and make their way through tertiary studies. We know what our education system is like in Australia. One of our huge income earners for our nation is education—people coming here to get a top-quality education. Our standards are tremendous, our reputation is great, and many from overseas—India, Asia or wherever—like to come here because they can hang their hat on one thing that makes them extremely proud: 'I have got a degree from an Australian university.' Of course, many of them come from very poor families, and when they come here they work very, very hard, and they need to work hard to pay their way through university, to pay for their accommodation and meals et cetera and the cost of living, only to find that some of these franchisors are simply abusing them. So the amendments put forward in this legislation make it a criminal activity and set up a watchdog with Professor Allan Fels at the lead—as I said, a thoroughly decent man—to see these people are not cheated, they're treated with respect, they are paid the correct award wages and they can get on with their lives without having to be bribed, blackmailed or whatever into receiving pay that is simply unacceptable and, of course, well below the award.
We have an award system in this country. We have umpires that set those awards: as I said, Fair Work Australia and the Fair Work Ombudsman, who make various decisions. Of course, when they make a decision that those opposite don't like, because those opposite set the whole system up, they blame us on this side of the chamber. That's quite amazing—blaming us for their activities, for establishing the umpire. The umpire makes a decision. I've seen it all my life. I've said it before. When the umpire was put in place to work on things such as the shearing award, when they gave a pay rise, we as graziers paid the pay rise with no questions asked. But, of course, when they said, 'You can use wide combs as an option,' what did we have? We had strikes, fights and sheds black-banned by the unions. My brother Peter and I had our shed black-banned because the umpire made a decision but the Australian Workers' Union didn't like it. So this is typical: when the umpire makes a decision, if those opposite don't like it, they say, 'Let's cause havoc and strife, as we did in the shearing industry.' Luckily, since then we've never seen a dispute in the shearing industry.
Hopefully this amendment will clean this mess up in Australia—I'm confident it will. With the inquiry into this by the Parliamentary Joint Committee on Corporations and Financial Services, we can have a good look over several months—six months or eight months; there'll be no hurry once the workload's off. We know how stressed the committees are for work at the moment. Let's look at the terms of reference. Let's have another look at the franchisors and the franchisees, how they've behaved and what pressure they're under. Is it the franchisors causing the pressure? That's one of the arguments under 7-Eleven: small profit margins and the small business battling to keep their head above water to survive financially. Look at the franchisees and their behaviour. Look at the compensation and how it's working.
It will be very good to have Allan Fels in front of the committee and ask Mr Fels some questions about how he carried out his duties at 7-Eleven, where he was going with it and why they kicked him out. That's the question I'd like to have answered, because he was brought in as a man who commands enormous respect in Australia. He was doing the right thing, serving out millions of dollars of compensation—rightfully so—to those foreign workers who were cheated, blackmailed, bribed or whatever, only to find that next thing Allan Fels was booted from his position as the independent umpire making judgements on those compensation packages.
I look forward to the ride ahead and say that, if we can see more wrongdoing in the franchise industry, hopefully the committee inquiry will bring that out. If necessary, we will come back into the chamber here and make more amendments, if we can find it out. That's what committees are there for: to find out what's wrong, to see the current laws, to recommend to the government and say, 'Hey, this needs changing; this is something you've overlooked,' and to hear those witnesses come forward.
I hope we get some of those young workers and students, many of them from India. We see them out there. They are great workers in the service stations, 7-Eleven stores, et cetera. Let's hear from them, let's hear their side of the story and let's see what else we can find out to see what else has to be done so that employers, franchisors and franchisees treat their workers properly. I've been fortunate in my life. I've been an employer and an employee. I worked as an employee as a truck driver, in small business, EMS, agricultural spraying and as a shearer. I've also been an employer in business and on the farm, so I have a good understanding of both sides. People should be treated fairly, paid at least the award and looked after—a fair day's work for a fair day's pay.
Senator LINES (Western Australia—Deputy President and Chair of Committees) (21:40): I too rise to make a contribution to the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017 that's before us this evening. Before I do that, though, I want to say that I am disappointed in some of the comments that Senator Williams has made, particularly when he described Australian local workers that he says didn't want to work in the local abattoir perhaps because they were drunk or on drugs. That is an absolute slur on the character of Australian workers. In fact, the visa inquiry which I chaired—and Senator McKenzie was the deputy chair—found quite the contrary in Queensland. I am very disappointed that Senator Williams, who normally does stick up for workers in this place, would make those slurs to suggest that these local workers were too drunk or high on drugs and not wanting to work in an abattoir. That is a slur against Australian local workers. I would ask that at some point he withdraw that.
I also want to draw Senator Williams's attention to the visa inquiry that Senator McKenzie and I did. There's no need to look at a joint inquiry. We did a Senate inquiry some two years ago that was set up under a reference that Labor put forward where we saw truly shocking exploitation of workers. I have to say that, as a longstanding trade union official before I came to the Senate, I made this remark during committee processes: I thought I had seen all the exploitation there was to see. I can certainly tell the Senate and those listening that the evidence I heard truly shocked me—Baiada, D'VineRipe, the abattoirs—it went on and on and on. And it wasn't just visa workers. We saw Australian or local workers displaced and visa workers put in their place, because they represented a cheap form of labour. It is absolutely unacceptable to what we in Australia stand for, and that is a fair day's pay for a fair day's work.
I'm pleased that this bill is with us, but it's taken way too long and it does not go far enough. Certainly, I'm sure, that is the view of all of my Labor colleagues; it simply doesn't go far enough. We found in the Senate inquiry that I chaired that it isn't just visa workers working in a particular segment of our labour market who are exploited. I'd suggest we don't need to scratch the surface very far at all to see that there's exploitation of workers in this country across nearly all industries. Unless they are well-regulated or well-unionised, exploitation is rife. That is a sad fact for a country that at Federation set some truly groundbreaking laws and initiatives when it comes to protecting vulnerable workers or all workers. We were one of the first countries to put in place the eight-hour day. Those are traditions we ought be proud of. Certainly, in terms of protecting workers, we should continue to do that, and this bill doesn't go far enough.
In the inquiry that we led in the Senate, we did focus particularly on visa categories which gave workers work rights. I'm not going to canvas the range of visas that do that, but all of those visas need proper regulations where the work is an incidental part of the visa, which it is for students coming here to work, or where it is someone on a 457 visa who is specifically here to work. What we heard in the committee was that the exploitation of foreign workers, and, indeed, local workers, meant that other programs we had where we particularly involved our neighbours in Timor-Leste—where those seasonal workers were invited over in a very targeted, well-protected program—tended to tail off, because foreign workers were being completely exploited. This means that employers now don't go to the trouble of setting up the seasonal worker programs that are primarily set up to enable workers from countries like Timor-Leste to come here and get that experience, to get some money to send back to their families. They were a reliable pool of workers, but those sorts of well-regulated programs are now under threat because of this open exploitation of foreign workers.
We also know that it's not just exploitation and the loss of significant wages. The underpayments at 7-Eleven are shameful, and I don't think anyone in this parliament disputes that. Millions of dollars were ripped off young workers. Imagine workers being forced to pay money back in this day and age! Employers were falsifying the wage record, and if you earned $100 for the day—although you'd have to be a very lucky 7-Eleven worker to get that much—your employer then clawed back at least half of that, and often more than that. Those workers were caught in a situation where they had to work more hours because they simply weren't earning enough, because the employer was ripping them off or was not paying them at all or was putting them on training shifts that didn't attract money. On and on and on it went.
In Queensland, the meat workers' union gave really strong evidence. There was a myth that local workers didn't want abattoir jobs, that they were simply hard to get; however, the meat workers' union went to towns, held town hall meetings, got young people to come along, got the employers from the abattoirs to come along, and they saw firsthand that in fact there was a pool of young workers. And not just young workers, but a pool of workers of all ages who really were prepared to work in an abattoir. They required some skilling and they required the vaccinations, as do foreign workers, but the employers simply didn't pick them up.
The meat workers' union didn't just leave it at this initial run-through in Queensland with employers to show that in country towns there actually were workers who wanted to do abattoir work. The union got commitments from the employers that they would take on these workers who had expressed an interest, and they went back some months later to find that only a very small proportion of those workers had been taken on. It was obvious to me, certainly, because of my former experience as a trade union official, that the competitive part of the meat industry, the abattoir industry, which is the boning room, was absolutely full of visa workers. Why? Because that is where competition is tough; that is where wages are contributing to profit levels. The more you ripped off foreign workers by paying them piece rates, which simply did not exist in the awards, or just ripped them off, then the bigger the profit margin was.
The employers tried to run this ridiculous argument that didn't hold water at all, saying how this was a particular skill area and required a certain amount of training. If that was the case, they had a supply of local workers who were ready and willing to be skilled up. But really, when it came down to it, when you took all the fluff and nonsense away from what the employers were saying, this was the area where you could really exploit foreign workers. You could pay them the award and not the enterprise agreement, because you were using a labour hire company. You could completely undercut the rates of pay and, therefore, enhance your profit. And what we know, through the meat industry, is that those workers weren't even getting the award rates of pay. You had the situation where the meat industry had negotiated enterprise agreements in consultation with the employer, the employer had agreed to pay X amount of dollars—particular rates for boners; particular rates across the rest of the abattoir—and yet in almost 100 per cent of cases we saw that the boning room in particular was the room where abattoir after abattoir—
The ACTING DEPUTY PRESIDENT ( Senator Reynolds ): It being 9.50 pm, I propose that the Senate now adjourn. Senator Lines, you will be heard in continuation.
ADJOURNMENT
The ACTING DEPUTY PRESIDENT ( Senator Reynolds ) ( 21:50 ): Order! I propose the question:
That the Senate do now adjourn.
Workplace Relations
Senator GALLACHER (South Australia) (21:50): I rise to make a contribution in adjournment about a very important issue to many South Australians and, indeed, many Australians. On 23 February 2017, the Fair Work Commission handed down a decision on penalty rates. That recommended a reduction in penalty rates for workers covered by four awards: fast food, pharmacy, retail and hospitality.
As different workers are employed at different levels under the different awards, each award has a different base rate of pay, and the impact on workers is diverse. To get a sense of the scale of the impact of the proposed cuts you need to have a look at the lowest paid casual workers covered by the retail award. They would lose $38.88 on a Sunday for an eight-hour shift. The highest paid permanent work is covered by the pharmacy award. That would be $127.09 worse off for an eight-hour shift.
While the number of people affected by the proposal is disputed, there is no dispute that the number of people affected is significant. The government is reported to believe about 285,000 people face a pay cut, while the ACTU points out that 648,000 people are covered by these relevant awards. To the extent that award conditions influence the conditions in non-government agreements, the number of people affected by the decision is likely to be even greater than the 648,000 which is quoted.
What we have here is a situation where a government, in seeking to refer to an independent umpire, has destroyed the independence of the umpire by making a continuous series of one-sided appointments. For anybody who is not familiar with the Industrial Relations Commission and its predecessors and the current Fair Work Commission, there's normally an appointment from an employer side and an employee side. This government disbanded that and made five direct appointments from one side, but it doesn't stop them saying that they still refer to the independent umpire.
What's really worrying is that, since 2013, real wages in normal terms have been flat. That's a problem for tax collectors. That's a problem for retailers. That's a problem for lenders. That's a problem in all sectors of the economy where people are finding it really difficult to consume goods and services, invest or borrow money. It's going to come back and bite the government exactly in the wrong place: in revenue collection and economic activity.
What we have in Australia is a system where, over 100 years, workers have been able to bargain. They've been able to get reasonably progressive wages and conditions, unlike other areas of the world, like the United States. If you were to talk to an American about long service leave, they'll think you're on another planet. Long service leave does not exist to them. If you were to talk to an American about four weeks annual leave every year, they'll think you're on another planet, because they get two weeks after five years. If you talk about a leave loading payment they'll think you're on another planet, and, if you talk about a minimum rate of pay of about $17-plus an hour, they'll also think you're in some sort of alternative galaxy.
One of the things we've done really well in Australia is to share the economy around. Workers, through unions and their own efforts, have been able to bargain for respectful wages and conditions and enjoy respectable take-home wages and conditions. A flat and declining wage outcome is not good for anybody: it's not good for the government, it's not good for business and it's certainly not good for those workers who rely on those penalty rates. Increasingly, the people in retail and fast food do not enjoy a full-time job. They are casuals and students. They are people who take that opportunity to supplement their studies with a couple of days of work. I think the stats are that junior rates are about 14.8 hours per week. That's about the average that junior workers get. That's actually dropped down to 13.4 hours per week. So it's not as if these people are working 40 hours plus the weekend; it's 14 or 15 hours a week. It is barely sustainment. They're barely able to sustain themselves. The diminution of their earning capacity through a reduction in penalty rates in retail and fast food is reprehensible. It really is penny-pinching and mind-boggling that a government thinks it can actually stimulate the economy by supporting this sort of reduction in take-home pay.
If we look at the average weekly total hours worked, it was 32.1 hours per week, but it has now gone down to 31.8. So even those who have a full week's work are suffering in that there's less work available throughout the working week. I'm sure that the people who earn these sorts of salaries spend 90 per cent, if not 100 per cent, of their take-home pay. They would need to do that just to simply sustain themselves. As I've already said, a lot of these people are students, people who are trying to progress themselves through university. They are incurring a HECS debt and they are earning some money to offset the burden they may be on their parents, or whomever. It really is an absolute disgrace.
Let's have a look in the state of South Australia. There'll be contention about these figures, but we know that in the seat of Boothby there are about 7,433 retail workers who are affected and 3,789 food and accommodation workers. In a federal seat almost 10 per cent of workers—11,222—are going to be affected by this reduction in penalty rates. That's a significant issue, and I'm sure all of those workers will know who the person in that electorate is who voted in favour of not protecting their penalty rates. Nicole Flint, the member for Boothby, is on the record as saying that she is not a supporter of penalty rates and that it is a disincentive for employment. Well, there are plenty of retail workers and pharmacy workers in the seat of Boothby who will remember those comments.
In the seat of Grey there are 6,529 retail workers and 4,303 food and accommodation workers—potentially a total of 11,482 workers affected. I know that Mr Rowan Ramsey is on the record as saying that I've distributed a DL which is a mistruth that was his characterisation of it. Look, you can argue the semantics of it, but are penalty rates going to be reduced in the seat of Grey? The answer is yes. Are they going to be reduced at Chemist Warehouse? The answer is yes. Are they going to be reduced at any of those outlets open on a Sunday? The answer is yes. Rowan and I will continue to engage right up until the next election about this issue, but, suffice to say, there is a substantial number of people who will be affected.
In the Xenophon seat of Mayo, 6,716 retail workers will be affected and 4,005 food and accommodation workers. It is a total of 10,721 workers. So we might take the ambit of the top level of people that are going to be affected by this, but you would need a pretty precise algorithm to actually work out who isn't going to be affected. We believe broad-brush is good. If that's the number of people in that sector then, potentially, they could be affected. I would say that some of those people may be under other agreements or arrangements and others may not be, but that's the potential of it.
This government has been mean-spirited with pensioners, with young workers and with fast food, retail and pharmacy workers. It is not going to end well. This is a recipe for electoral disaster, hopefully. In all of these seats where up to 10 per cent of the most vulnerable workers are affect by this diminution in penalty rates we will use our best endeavours to make sure that they know who is responsible for this, that they know that they should be talking to their elected member of parliament, saying, 'Why aren't you resisting this? Why aren't you protecting my ability to earn a decent wage, enjoy decent conditions and go about my business in a satisfactory and sensible way?' It's particularly wrong to deny the 30 per cent of young workers who are unemployed the ability to enjoy a fruitful return for their endeavours.
Indigenous Employment
Senator SIEWERT (Western Australia—Australian Greens Whip) (22:00): Towards the end of July, I was invited up to the Warburton community in Western Australia. For those that don't know, it's near the Western Desert, in the tri-state area near the border with South Australia and the Northern Territory. I was asked to go up there for a number of reasons. One was to look at the impact of the CDP, which we were talking about in this chamber earlier today. The severe consequences of the government's CDP and the impacts it is having in Warburton were explained to me. The people there told me about the number of people that had been breached, which means that they weren't getting income support. They talked about the impact that was having on their community, about the lack of food people who had been breached could put on the table and about the pressure it put on other members of the community. In fact, one gentleman who was working told me he was spending his whole pay packet feeding community members, because there is an expectation in their community that you look after each other. So when somebody's breached or somebody's without resources and can't put food on the table, families support those members of the community.
When I visited the store, which is owned and run by the Ngaanyatjarra Council, they told me revenue had dropped by 50 per cent. That's very significant. If revenue has dropped by 50 per cent, it means that's a lot of food that's not being bought and put on people's tables. They told me the CDP pays no respect to their cultural obligations. For example, when somebody passes away and there's sorry business, it's a cultural requirement that people attend the funerals. Centrelink says, 'Oh. Well, tell us when you're getting back. What date are you getting back?' These cultural requirements don't happen by the day; they happen by whatever particular cultural practice at that time dictates.
The people of Warburton also said that what they very strongly want is a proper Centrelink office or agency there. I saw piles of letters that had come in. As we described in this chamber earlier, people in Warburton don't have postal addresses. Centrelink makes phone calls from Queensland, not even from Western Australia. So Centrelink calls to Warburton are made from the call centre in Queensland, where apparently the staff don't know what time it is in Western Australia. When I was there, there were at least two appointments that were 'missed' because, although the person was at the right place at the right time to be phoned, the phone call never arrived. It would be interesting to see how that's noted down, whether that's a 'missed' phone call. Centrelink presumably rang at a different time by two hours or, in fact, 1½ hours, because sometimes they call on Australian Central Standard Time rather than on Western Standard Time. The bottom line is that people are being breached. I know the minister was in here saying that they are being waived, but people are being dropped off income support for eight weeks up there. They're also getting a hell of a lot of no-show, no-pay.
The people in Warburton very desperately want CDEP. They want community controls. They want the CDEP, which they said used to work very well, where there were community wages. People felt they were working. They were working in real jobs and were not on income support. There was a very strong message from the community that they want CDEP. In fact, they consider the CDP discriminatory, and I agree with them. It is. It is a program that is specially designed and gives different conditions to Aboriginal communities. It requires work for the dole where that doesn't occur in other communities.
The other matters that were raised with me by the Ngaanyatjarra Council were the impact of changes—and this is largely a Western Australian issue, but it just shows the craziness of the way things work. They used to have a really good system where the Ngaanyatjarra Council, who have a number of businesses employing local Aboriginal people, by and large, did maintenance on houses. Then the Western Australian government came up with the idea that there may be a conflict of interest if the Ngaanyatjarra Council are contracting out to fix these houses. So now they send people up on about an eight- or nine-hour drive from Kalgoorlie to do an assessment of what needs to be done on a house, and then they drive back again. It is totally ludicrous.
They had a situation where a woman had been waiting months and months and months to get her air-conditioning fixed. I'm sure that probably most people listening in the chamber at the moment have been in the desert at some time. You can imagine what it's like in the desert without an air conditioner. Other people had been waiting for sewerage—sewage was literally free-flowing near their front door—to get fixed. For another person, the power had been off for a very long time, and they were waiting for that to get fixed, all the time knowing very well that there were actually contractors and people with the skills in the community to fix it, but they couldn't tender to do it—a ridiculous situation.
Of particular concern was that Warburton has optic fibre in town. They have optic fibre. I saw it with my very own eyes. In fact, I've got two photos in my iPhone. They took the cover off the hole, showed me where it said 'optic fibre', showed me the blue cable and took me just around the corner, where the health clinic was. Literally less than 20 metres away, there's another box with optic fibre in it, but there's no NBN. There's no access to that optic fibre. That optic fibre is not providing high-speed internet, so the clinic can't do telehealth, because at the moment the cable is curled around in the box. The school can't get access to high-speed internet. They can't access some of those programs that would be fantastic if they could get high-speed internet.
Do you know that the Ngaanyatjarra Council tipped in a million dollars of their own money to contribute to some money that Telstra put in and that NBN supposedly put in? They've got the cable there, but they can't get access to it, because it's far too expensive. They want to charge an absolute fortune for the school, for the health clinic and for residents to get access to it, when the Ngaanyatjarra Council have put in a million dollars of their own money.
Ngaanyatjarra Council have also invested in the early-learning centre there, which works predominantly with Aboriginal children, who get access to programs—and they are excellent programs—that are preparing them for school. One of the areas that they're very keen to pursue is an Aboriginal early-years workforce, and they're very strongly pursuing that issue.
They also have an excellent youth centre, the Wilurarra Creative centre, which we also visited, and we saw the absolutely excellent work that the young people in Warburton have been doing. But there are too many forms. They can't actually be part of the CDP because there are far too many forms and requirements through the CDP for them to be able to participate in that program. They also have a brilliant Aboriginal arts centre, which is truly fantastic.
They've also successfully lobbied to get the work camp back up and running. They lobbied for a work camp for some men coming out of the prison system to come into the community, to finish their rehabilitation and to work around the community. The previous government had closed that down, so the community lobbied the new government to get it open again, and they are very pleased that it is now open again.
Warburton has been trying to look after its own future—to take a self-determination approach to its future. The Ngaanyatjarra Council looks after its community, in terms of trying to provide jobs and build jobs. It also has been trying to make CDP work. But it's not. This program is having a hugely detrimental impact— (Time expired)
White, Mr Terry
Senator DUNIAM (Tasmania) (22:10): It is a pleasure to rise tonight to speak on and pay tribute to the hard work of a significant contributor to the agricultural sector in Tasmania, and that is Terry White, who is a passionate Tasmanian farmer who operates Highfirth Seeds at Wattle Hill in Sorrell in Tasmania's glorious south-east, which I'm sure you'd be very familiar with, Mr President. Specifically why I am talking about Mr White tonight is his involvement in and contribution to the excellent event known as Old Mates Day, which is a day that brings together like-minded people, mostly from the agricultural sector, to catch up for support and camaraderie, which I think is an admirable thing, given the amount of time these people spend on the land and often in isolated circumstances.
Old Mates Day, as it's known, was triggered by the demise of the Bridgewater livestock sales in southern Tasmania, which is where most of the communication between farmers and butchers and livestock agents and associates over many generations happened. It was where they caught up and exchanged information. The sales weren't just business; they were also social. Once that source of contact disappeared from these people's lives, they sought other ways to get that contact. So Mr Terry White instituted what's become known as Old Mates Day.
Farming, though, as all of us have acknowledged at various points in our contributions in this chamber, is a massive contributor to the nation's economy, and Tasmania is no exception to that. Indeed, anyone who travels around Tasmania knows that farming is embedded very much in our daily lives. If you look at the national figures around farming and its significance, and when you consider that there are 134,000 farming businesses in Australia and the vast majority—some say 99 per cent—of which are family-owned and -operated, it points out how important this sector is to small communities and to the families who live in those small communities. Each Australian farmer produces enough food to feed 600 people—150 here in Australia, and the balance, 450, overseas. Australian farmers, interestingly, produce almost 93 per cent of Australia's daily domestic food supply. All of these figures are sourced from the National Farmers' Federation's compendium of information. We do know that the Tasmanian agricultural sector is a diverse one, but it is a key pillar of the Tasmanian economy, with an annual farm-gate value of $1.44 billion as at 2014-15, growing by six per cent on the previous financial year.
As we know, and as we saw in the election campaign in Tasmania, farming has some significant challenges of an environmental sort; we have significant floods, but we also have droughts, often coming in close succession, in addition to bushfires. But the challenges that don't get as much airing as the significant environmental challenges are those around isolation and the mental health issues that flow from that, including depression. In these circumstances, as I've alluded to before, it's incredibly important—it's paramount, in fact—that farmers and those who live on the land do get together and talk. That's why events like Old Mates Day are so important, and it was a pleasure to support this event.
Farming, obviously, is a physically demanding profession. It's also psychologically demanding. It is characterised by high rates of stress and injury and also, sadly, suicide. One of the major issues we have to deal with as a country is access to support services in the mental health area for farmers. They have only a fifth of the amount of services available to them compared to their brethren living in the cities, according to statistics published by the Royal Flying Doctor Service. In Tasmania, though, we have great services with Rural Alive & Well, an excellent service I look forward to supporting into the future.
A recent research paper entitled Mental health in remote and rural communities found that country residents risk exacerbated mental illness because of insufficient early intervention and prevention services. In particular, farmers, young men and older people in remote areas are at the greatest risk of committing suicide. That is of immense concern to me, as I'm sure it is to my Tasmanian colleagues in the chamber tonight. Pleasingly, though, the Tasmanian government has recognised the importance of suicide prevention in our rural communities, for those who often do it tough and are at the whim of commodity cycles, by investing another $1.7 million in Rural Alive & Well over the next three years. This will provide certainty to that valuable service and will continue to provide that excellent service to these regional communities right across our state.
Back to Old Mates Day, and, as I said, it was an important opportunity for communities to join together to celebrate all that's good about Tasmanian agriculture: the innovation, the resourcefulness, the sense of community and the pride that we have in this sector in being one of our state's key pillars to the economy. This is something I pointed out in my first speech to this place, I recall right now. This year, the Old Mates Day motto for the 2017 event was 'See a mate before it's too late'. It was held at the Bream Creek Showgrounds in, as I said before, the picturesque south-east of our state. I'm told that many of the people who attended the event this year hadn't seen one another for many years. As is the case, people just get carried away with their daily lives and work, and they have no capacity to get around and socialise. That's why this event was such an excellent one. It's a great initiative, and I put on record tonight—and I'm sure also on behalf of my Tasmanian colleagues—my thanks and appreciation to Terry White for his ongoing efforts and passion in supporting farmers from right across Tasmania in putting together this event. It's people like Terry who characterise the strength and resilience of our regional communities and the quirkiness of some of our regional communities. I thank Terry and also all of those who supported him in putting together this excellent event. Organisations like Rural Alive & Well, the Tasmania Fire Service, the Tasmanian Farmers and Graziers Association and a number of parliamentarians across the political spectrum.
As I may have alluded to, I wasn't able to make it on the day, unfortunately, but I was happy to on behalf of the Tasmanian Liberal Senate team provide a couple of hundred sausages for the hungry farmers to feast on while they caught up with one another. I have absolutely no doubt that this event will be an excellent and growing event for years to come. I commend all Tasmanian senators and members of the House of Representatives to support this event in years to come. Thank you.
Senate adjourned at 22:18
DOCUMENTS
Tabling
The following documents were tabled by the Clerk pursuant to statute:
[Legislative instruments are identified by a Federal Register of Legislation (FRL) number. An explanatory statement is tabled with an instrument unless otherwise indicated by an asterisk.]
A New Tax System (Family Assistance) Act 1999—Family Assistance (Meeting the Immunisation Requirements) Principles Amendment 2017 [F2017L01003].
Census and Statistics Act 1905—Census and Statistics (Statistical Information) Direction 2017 [F2017L01006].
Commissioner of Taxation—Public Rulings—
Class Rulings—
Addenda—CR 2016/18 and CR 2016/85.
CR 2017/51 and CR 2017/52.
Product Ruling PR 2017/9.
Defence Act 1903—Section 58B—Living-in accommodation, meals, utilities and excess service – amendment—Defence Determination 2017/26 [F2017L01002].
Financial Framework (Supplementary Powers) Act 1997—Financial Framework (Supplementary Powers) Amendment (Health Measures No. 2) Regulations 2017 [F2017L00544]—Replacement explanatory statement.
Health Insurance Act 1973—Health Insurance (Section 3C Pathology Services—17p Deletion Testing) Determination 2017 [F2017L01004].
Public Governance, Performance and Accountability Act 2013—Commonwealth participated in the formation of Silicon Quantum Computing Pty Ltd—10 August 2017.
Sydney Airport Curfew Act 1995—Dispensation Report—07/17.
Tabling
The following documents were tabled pursuant to standing order 61(1)(b):
Institutional Responses to Child Sexual Abuse—Royal Commission—Criminal justice report, dated August 2017 (3 volumes).
3. Telecommunications (Interception and Access) Act 1979—Report for 2015-16 on the operation of the Act.