I remind senators that the question may be put on any proposal at the request of any senator.
This bill will reintroduce the seniors supplement budget measure, which was originally introduced, as senators will recall, in an earlier budget bill. As introduced, the measure would cease payment from 20 September 2014 of the seniors supplement for holders of the Commonwealth seniors' health card or the Veterans Affairs' gold card; however, other benefits will remain available to cardholders, such as discounts on medicines under the Pharmaceutical Benefits Scheme. In conjunction with this change to the seniors supplement, the bill will ensure that cardholders who formerly received the clean energy supplement in association with their card will now receive the renamed energy supplement maintained at current levels through the permanent removal of indexation.
Amendments will be moved to the bill to update the measure in light of delayed passage. This will remove schedule 1 and update with schedule 4 from the Social Services Legislation Amendment (Fair and Sustainable Pensions) Bill 2015 in its entirety. In particular, the implementation date will be moved to 20 June 2015, meaning the last quarterly payment of the seniors supplement will generally be one made on 20 June 2015. I am content to leave my remarks there.
Question agreed to.
Bill read a second time.
I seek leave to move together the government amendments on sheet ZA397.
Leave granted.
I move the government amendments on sheet ZA397:
(1) Clause 2, page 2 (table item 2), omit the table item, substitute:
(2) Schedule 1, page 3 (line 1) to page 14 (line 7), omit the Schedule, substitute:
Schedule 1—Energy supplement replacing seniors supplement
Part 1—Main amendments
Social Security Act 1991
1 Subparagraph 8(8)(y)(viib)
Omit "seniors supplement", substitute "energy supplement".
2 Subsection 23(1) (definition of seniors supplement )
Repeal the definition.
3 Paragraph 916D(3)(c)
Omit "seniors supplement", substitute "energy supplement".
4 Paragraph 1061R(d)
Omit "seniors supplement under this Act or the Veterans' Entitlements Act", substitute "energy supplement under Part 2.25B of this Act or Part VIIAD of the Veterans' Entitlements Act".
5 Paragraph 1061T(2)(b)
Omit "seniors supplement", substitute "energy supplement under Part 2.25B".
6 Paragraph 1061TA(2)(b)
Omit "seniors supplement under the Veterans' Entitlements Act", substitute "energy supplement under Part VIIAD of the Veterans' Entitlements Act".
7 Part 2.25B
Repeal the Part, substitute:
Part 2.25B—Energy supplement
Division 1—Qualification and payability
1061U Qualification for energy supplement
A person is qualified for energy supplement if the person is the holder of a seniors health card.
1061UA When energy supplement is payable
(1) Energy supplement is payable to a person in relation to each day on which the person is qualified for the supplement.
(2) However, energy supplement is not payable to the person in relation to a day if:
(a) before that day:
(i) the person had elected not to be covered by this Part; and
(ii) that election had not been withdrawn; or
(b) subsection 55(5) (failing to nominate a bank account) of the Administration Act applies to the person.
Division 2—Rate of energy supplement
1061UB Rate of energy supplement
(1) If subsection (2) applies to the person on a day, the person's daily rate of energy supplement, for that day, is 1/364 of the amount worked out using the following table:
(2) This subsection applies to a person on a day if on that day the person is residing in Australia and either:
(a) is in Australia; or
(b) is temporarily absent from Australia and has been so for a continuous period not exceeding 6 weeks.
8 Section 1190 (note)
Omit "the rate of seniors supplement (see section 1061UB) and".
Social Security (Administration) Act 1999
9 Section 12D (heading)
Repeal the heading, substitute:
12D Energy supplement
10 Section 12D
Omit "seniors supplement", substitute "energy supplement under Part 2.25B of the 1991 Act".
11 Section 48B (heading)
Repeal the heading, substitute:
48B Payment of energy supplement
12 Subsection 48B(1)
Omit "Seniors supplement", substitute "Energy supplement under Part 2.25B of the 1991 Act".
13 Subsection 48B(2)
Omit "seniors supplement", substitute "energy supplement".
14 Paragraph 48B(3)(a)
Omit "seniors supplement", substitute "energy supplement".
15 Subsection 48B(4) (paragraph (a) of the definition of instalment period )
Omit "seniors supplement", substitute "energy supplement".
16 Subsection 48B(4) (note to paragraph (a) of the definition of instalment period )
Omit "seniors supplement", substitute "energy supplement".
17 Subparagraphs 66A(2)(a)(i) and (3)(a)(i)
Omit "seniors supplement", substitute "energy supplement under Part 2.25B of the 1991 Act".
18 Subsection 68(1)
Omit "seniors supplement", substitute "energy supplement under Part 2.25B of the 1991 Act".
19 Subsection 69(1)
Omit "seniors supplement", substitute "energy supplement under Part 2.25B of the 1991 Act".
20 Paragraph 75(1)(b)
Omit "seniors supplement", substitute "energy supplement under Part 2.25B of the 1991 Act".
21 Section 78A
Omit "seniors supplement", substitute "energy supplement under Part 2.25B of the 1991 Act".
22 Section 90A
Omit "seniors supplement", substitute "energy supplement under Part 2.25B of the 1991 Act".
23 Section 123A (paragraph (e) of the definition of relevant payment )
Omit "seniors supplement", substitute "energy supplement under Part 2.25B of the 1991 Act".
24 Saving and transitional provisions
(1) Paragraph 916D(3)(c) of the Social Security Act 1991 applies on and after the commencement of this item as if a reference in that paragraph to energy supplement included a reference to seniors supplement.
(2) Despite the amendments made by items 7 and 12 to 16, Part 2.25B of the Social Security Act 1991, and section 48B of the Social Security (Administration) Act 1999, as in force immediately before the commencement of this item, continue to apply on and after that commencement in relation to an instalment period ending before that commencement.
(3) An election referred to in subparagraph 1061UA(2)(a)(i) of the Social Security Act 1991 that was in force immediately before the commencement of this item continues in force on and after that commencement.
Veterans ' Entitlements Act 1986
25 Paragraph 5H(8)(gb)
Omit "seniors supplement", substitute "energy supplement".
26 Subsection 5Q(1) (definition of seniors supplement )
Repeal the definition.
27 Section 59A (note 1)
Omit "Note 1", substitute "Note".
28 Section 59A (note 1)
Omit "and the rate of seniors supplement (see section 118PB)".
29 Section 59A (note 2)
Repeal the note.
30 Subsection 62E(1) (note 1)
Repeal the note.
31 Subsection 62E(1) (note 2)
Omit "Note 2", substitute "Note".
32 Paragraph 118B(3)(c)
Omit "seniors supplement under this Act or the Social Security Act", substitute "energy supplement under Part VIIAD of this Act or Part 2.25B of the Social Security Act".
33 Part VIIAD (heading)
Repeal the heading, substitute:
Part VIIAD—Energy supplement
34 Section 118P (heading)
Repeal the heading, substitute:
118P Eligibility for energy supplement
35 Subsection 118P(1)
Omit "for seniors supplement", substitute "for energy supplement".
36 Subparagraph 118P(1)(b)(iv)
Repeal the subparagraph, substitute:
(iv) energy supplement under Part 2.25B of the Social Security Act.
37 Subsection 118P(2)
Omit "for seniors supplement", substitute "for energy supplement".
38 Subparagraph 118P(2)(d)(iv)
Repeal the subparagraph, substitute:
(iv) energy supplement under Part 2.25B of the Social Security Act.
39 Section 118PA (heading)
Repeal the heading, substitute:
118PA When energy supplement is payable
40 Subsection 118PA(1)
Omit "Seniors supplement", substitute "Energy supplement".
41 Subsection 118PA(2)
Omit "seniors supplement", substitute "energy supplement".
42 Division 2 of Part VIIAD (heading)
Repeal the heading, substitute:
Division 2—Rate of energy supplement
43 Section 118PB (heading)
Repeal the heading, substitute:
118PB Rate of energy supplement
44 Subsections 118PB(1) and (1A)
Repeal the subsections, substitute:
(1) If subsection (2) applies to the person on a day, the person's daily rate of energy supplement, for that day, is 1/364 of the amount worked out using the following table:
Note: For member of a couple, partnered, illness separated couple and respite care couple see subsections 5E(1) and (5) and 5R(5) and (6) respectively.
45 Subsection 118PB(2) (heading)
Repeal the heading.
46 Division 3 of Part VIIAD
Repeal the Division, substitute:
Division 3—Payment of energy supplement
118PC Payment of energy supplement
(1) Energy supplement under this Part is to be paid by instalments.
(2) An instalment of energy supplement is to be paid to a person as soon as is reasonably practicable after the end of an instalment period.
(3) The amount of the instalment is worked out by:
(a) working out the person's amount of energy supplement for each day in the instalment period (using the daily rate of the supplement for that day); and
(b) adding up the amounts resulting from paragraph (a).
(4) In this section:
instalment period means a period:
(a) in relation to each day of which energy supplement is payable to the person; and
Note: For when energy supplement is payable to the person, see section 118PA.
(b) that either begins on any 20 March, 20 June, 20 September or 20 December or does not include any such day; and
(c) that either ends on any 19 March, 19 June, 19 September or 19 December or does not include any such day; and
(d) that is not included in a longer instalment period.
47 Subsections 122A(1A) and (1C)
Omit "seniors supplement", substitute "energy supplement under Part VIIAD".
48 Saving and transitional provisions
(1) Despite the amendments made by items 33 to 46, Part VIIAD of the Veterans' Entitlements Act 1986, as in force immediately before the commencement of this item, continues to apply on and after that commencement in relation to an instalment period ending before that commencement.
(2) An election referred to in subparagraph 118PA(2)(a)(i) of the Veterans' Entitlements Act 1986 that was in force immediately before the commencement of this item continues in force on and after that commencement.
Part 2—Consequential amendments
Income Tax Assessment Act 1997
49 Section 52 -10 (table item 22B.1)
Omit "Seniors supplement", substitute "Energy supplement under Part2.25B of the Social Security Act 1991".
50 Section 52 -40 (table item 22B)
Omit "Seniors supplement", substitute "Energy supplement".
51 Section 52 -65 (table item 16A.1)
Omit "Seniors supplement", substitute "Energy supplement under PartVIIAD of the Veterans' Entitlements Act 1986".
52 Section 52 -75 (table item 16A)
Omit "Seniors supplement", substitute "Energy supplement".
53 Saving provision
Despite the amendments of sections 52-10 and 52-65 of the Income Tax Assessment Act 1997 made by this Schedule, item 22B.1 of the table in section 52-10 of that Act, and item 16A.1 of the table in section 52-65 of that Act, as in force immediately before the commencement of this item, continue to apply on and after that commencement in relation to a payment of seniors supplement made before, on or after that commencement.
Military Rehabilitation and Compensation Act 2004
54 Paragraph 222(5)(d)
Repeal the paragraph, substitute:
(d) energy supplement under Part 2.25B of the Social Security Act 1991 or Part VIIAD of the Veterans' Entitlements Act 1986; or
55 Paragraph 246(4)(d)
Repeal the paragraph, substitute:
(d) energy supplement under Part 2.25B of the Social Security Act 1991 or Part VIIAD of the Veterans' Entitlements Act 1986; or
Part 3—Transitional provisions
56 Transitional provision—seniors supplement
If a person has been paid seniors supplement under Part 2.25B of the Social Security Act 1991 or Part VIIAD of the Veterans' Entitlements Act 1986 in relation to a day on or after 20 June 2015 and before 20 September 2015, then the amendments made by this Schedule do not apply in relation to the person in relation to that day.
At this stage it is important that I put on record that our position has changed on this bill. Those of you who can remember the passionate speeches made in this place last November will understand that after consideration of the range of issues before us in this area—there have been several changes as proposed legislation by the 2015 budget, which overtakes this process as it was part of the 2014 budget—and the fact that many, many more proposals are on the table, Labor's position has now changed. In view of Labor's need to focus on our support of people who are receiving pensions, our position on the removal of the pensioner supplement is that we are now supporting the government's position on this bill.
The Greens also spoke about this bill at the time and some concerns were expressed. We had a lot of concerns around this particular bill when we spoke about it in the chamber. People will also remember that when we put in our dissenting report to the committee inquiry into the 2014-15 budget measures, this was the measure that we thought, if you were considering it in the context of a retirement income review, would be one that would make the most sense of all of those terrible budget measures that the government sought to put through this place last year.
As the government noted last week, they have now committed to a review, through the tax white paper process, of looking at retirement income reviews and a more holistic approach. Although the government have not committed to some of the policy changes that we would like to see, at least we now have that retirement income review and people can participate in it. People can see the need for changes. As the Council on the Ageing said on Radio National before the budget:
… it's clear that there's a broad consensus out there in the sector that wasn't there five years ago as to how the basic architecture of the system ought to be restructured—
and we agree. We agree that the system does need a significant amount of change. The removal of this payment is in fact one of the first steps to what we believe would be a fairer system, a system where it makes sense to make sure that those who have the advantages that have allowed them to accumulate their wealth can, in fact, start using those assets that they have accumulated.
As we know, the senior supplement is a payment to older Australians who do not in fact qualify for the age pension. They do not qualify at all for the pension because their personal wealth and accumulated savings are very significant. In fact, in order to qualify for this supplement you have to have a significant amount of savings and assets. In the context of the changes that have occurred through this budget measure and the fact that we now have a commitment to a retirement income review, we have re-looked at this bill and we now think that this is an appropriate measure.
We also need to bear in mind the ACOSS report that has just come out today, which talks about inequality and points out that wealth and income inequality in this country is a huge issue. Although the report says that Australia's is above average for the OECD, in fact inequality is still, fortunately, below that in the US and that in the UK and a few other countries—but it is above average in the OECD. We need to address the issue around wealth and income inequality now or it is only going to get worse. The top 20 per cent hold 70 times the wealth of the rest of Australia. That is a significant issue that needs to be addressed.
We know that income inequality has a devastating impact on a society. It lowers health outcomes and it means that there are fewer opportunities for people to gain access to education to get better jobs. It can increase intergenerational inequality. These are all things that we believe need to be addressed. I think the ACOSS report is a very timely report that highlights this fact, and we are bearing that issue in mind whenever we look at these measures. We believe that a system of addressing income inequality and retirement income has only just started being addressed in this country. There is broad agreement among stakeholders that the system is not working—that it is skewed and needs to be re-addressed. We are starting to take those first steps now. We are looking at the long-term aim of having a fairer system for all people on income support, particularly those who have to rely on the pension.
I table a supplementary explanatory memorandum relating to the government amendments moved to this bill.
The question now is that government amendments (1) and (2) on sheet ZA397 be agreed to.
Question agreed to.
Bill, as amended, agreed to.
Bill reported with amendments; report adopted.
I move:
That the bill be now read a third time.
Question agreed to.
Bill read a third time.
The purpose of the Private Health Insurance (Prudential Supervision) Bill 2015 and related bills is to transfer the prudential regulation functions of the Private Health Insurance Administration Council to the Australian Prudential Regulation Authority from 1 July 2015. This means that PHIAC will be abolished and its functions absorbed by the existing regulator of general and life insurance and superannuation, APRA.
The Private Health Insurance Administration Council is an independent statutory authority that was established to ensure competition in the health insurance industry and to ensure the prudential safety of individual private health insurers. PHIAC has also played a critical role in protecting the interests of the more than 13 million people who are covered by 6.4 million private health insurance policies. Commonwealth legislation requires all Australians earning above a certain income to be covered by an appropriate level of private health insurance or face a tax penalty.
PHIAC operates a powerful database which can compare every single policy—and there are more than 40,000 of them—and provide this information to consumers in a simple and understandable format via its website. Despite the significant benefit this provides to consumers, enabling them to compare premiums and understand the differences between policies before they make decisions about what is best for them, it seems that the government does not think it is important for people to understand more about private health insurance. The government says that, by getting rid of PHIAC, they are delivering on their commitment to smaller government and that it will lower costs for industry and ensure that Australia's private health insurance industry remains stable and well regulated. PHIAC estimates its administration costs at 60c per policy. It seems to me that Australians who have private health insurance get pretty good value for money from PHIAC and that 60c is a small price to pay for good, non-biased information on health insurance products.
What the government has failed to tell people is what the benefits of scrapping PHIAC are for the 13.2 million Australians who have private health insurance, especially since there is no suggestion that premiums will be reduced or services improved. Instead, it seems as if the government would rather diminish its role in the oversight of private health insurers at a time when it should be exerting maximum pressure to keep down health insurance premiums.
Since 2007, health insurers wanting to raise premiums have had to seek approval from the Minister for Health. Under Labor, insurers typically found their first request was questioned, sometimes denied, and met with a demand to justify their fee rises. Under the Abbott government, private health insurance premiums have risen 6.818 per cent this year, after a rise of 6.2 per cent last year; and for the major funds, which cover the vast majority of Australians, the average increases were well in excess of seven per cent. These rises were bigger than any rise between 2007 and 2013 under Labor, when the average rise was 5.35 per cent.
Along with scrapping the stand-alone regulator, PHIAC, the government is getting rid of the stand-alone Private Health Insurance Industry Ombudsman. In 2012, Labor gave PHIAC greater oversight of the private health insurance industry and tasked it with being the health minister's primary adviser. We also provided $1.4 million to increase the Private Health Insurance Industry Ombudsman's capacity to manage complaints and respond to consumer inquiries, and $2.3 million was allocated to establish the PHIAC Premiums and Competition Unit. However, it is clear that the Abbott government is adopting a hands-off approach and appears to be laying the groundwork for the minister to abandon oversight of premium rises. It may only be a matter of time before private health insurers have totally unregulated powers to increase premiums as they see fit, to drive bigger shareholder returns, particularly since there is now no longer a government owned insurer to keep prices down.
There are strong concerns in the health sector that a generic industry regulator will not have the specialist knowledge needed to properly regulate such a vast and complex industry. APRA itself has been the subject of some findings by parliamentary committees—findings that have not been complimentary—for its failure to properly regulate the insurance and superannuation sectors, which led to the collapse of major institutions such as Storm Financial, HIH and Trio/Astarra.
Private health insurance is highly complicated in Australia, with community rating, risk equalisation, taxation surcharges, rebates and membership incentives. But many consumers do not have the time to make sure they fully understand exactly what they are paying for, and that is why PHIAC has been critical. It has ensured people can access information to better inform their decision making.
Having said that, Labor indicate that in this case we will support this legislation, but I do indicate to the minister that I will be asking a series of questions during the committee stage.
I thank Senator McLucas for her contribution. This package of bills will transfer the Private Health Insurance Administration Council's prudential regulation functions to the Australian Prudential Regulation Authority, APRA, from 1 July 2015. The consolidation of the council's functions within APRA as the current financial services regulator will reduce duplication, improve coordination and increase government efficiency.
The approach outlined in the legislation is intended to minimise the disruption to the private health insurance industry and ensures that sound prudential supervision will be maintained from 1 July 2015. It will not fundamentally change the regulatory framework faced by the industry. APRA will continue to provide the industry with the services that the council previously provided, and there will be no substantive changes to the supervisory approach to private health insurers. That means that private health insurers who are compliant with the current prudential framework will not need to take any steps in order to be compliant with the new prudential framework on 1 July.
This package of bills sets out the prudential regulation framework to enable APRA to supervise the private health insurance industry and with some exceptions will be the same as the existing prudential framework. The exceptions include aligning certain provisions to APRA's existing supervision regime, which will help APRA to remain efficient and cost effective. APRA will remake the existing prudential standards and rules to ensure they align with the bill, but the substance of those rules and standards will not materially change.
I also want to assure colleagues that the valuable knowledge held by the council on supervising the industry will not be lost; around 80 per cent of staff will transfer to APRA. It is also important to note that the current collection of industry data and the production of reports will be maintained by APRA, ensuring continuity. The transfer of the council's prudential regulation functions to APRA will over time result in savings to industry. These savings will be reflected in reduced annual supervisory levies payable by the private health insurance industry. I should reiterate that under these changes overall policy responsibility for private health insurance policy will remain with the Minister for Health under the Private Health Insurance Act 2007.
With this package of bills the government is fulfilling its commitment to smaller government. I commend the bills to the Senate.
Question agreed to.
Bills read a second time.
I know Senator Xenophon has an interest in this bill; so, Senator Xenophon, when you wish to engage, please do so. I have a few questions that I want to get on the record. Minister, you indicated in your second reading speech that there would be basically no changes to the operation of the private health insurance industry but also that there are going to be savings. I would like some understanding of where those savings might be. You did indicate that they would align certain provisions with the APRA provisions, but I am at a bit of a loss to understand where these valuable savings are going to be and to whom the savings will flow. Naturally, I am interested in understanding that they will flow to consumers if in fact there are going to be any savings. Given that I did indicate in my speech on the second reading that the cost to a policy holder is something like 60c, I am still of a view that we need to understand what the motivation for these amendments would be. I will also go to protections of consumer access to information in some subsequent questions.
But where are the savings? What will they be? Who will benefit from any savings that may be achieved?
Senator McLucas would be aware that industry pays for APRA through levies. We anticipate that there will be back office savings, and therefore these will be passed on to industry.
What is the quantum?
I am advised that we do not have an estimate that we can provide at this point in time.
We do not have an estimate, so do we know that there are going to be savings? Do we actually know?
I am advised that there will be a reduction of four staff, so that represents a saving, but I can indicate that this is not going to cost more and that there is confidence that there are back office savings to be had.
So four staff we are going to save—is that what you said, Minister? Four staff? What is the cost of abolishing the industry ombudsman and PHIAC?
I will seek to obtain that for you, Senator, but the advisers do not have that to hand.
Thank you for taking that on notice. I am also interested in understanding this: 80 per cent of the staff are transferring, and four staff we would lose, which is a shame for those four people. Can you assure the committee that all the specialist knowledge that is held in PHIAC will transfer but then be maintained? That is the assurance that the Senate needs: that not only do we transfer in the first instance but, over time, that specialist knowledge will be maintained into the future.
Yes, it will be transferred and, yes, it will be maintained.
I am glad that is on the record, because that is what I wanted to hear, because that is the point: in the future, we need to be assured that we have the specialist staff and skills that are currently doing fantastic work to keep knowledge of private health insurance, as a different product to other insurance products in the array of insurance products in the country. Can I now have an undertaking from the minister that the website, with all of its capabilities, will be maintained into the future, and will it change its address?
I am advised that the website is maintained by the Private Health Insurance Ombudsman and that that will continue.
It is a legitimate question about the address changing.
I did not get an opportunity to make a contribution on the second reading. I will not as such, but I will just say that I express my reservations in respect of the Private Health Insurance (Prudential Supervision) Bill 2015, and I also want to express my concerns about the affordability of private health insurance generally. The coalition did walk away from its promise on the issue of restoring the rebate and issues of indexation. I think it is important that we have a health system where there is a good balance between the public and private systems. We know what the Productivity Commission said a number of years ago about this when it undertook an analysis of how the two systems operate side by side—the number of very good things that the public system does and the good things that the private system does. I am concerned that, as a result of changes under the former government, private health insurance is becoming less and less affordable and that we are heading to a dangerous tipping point where more and more people will downgrade their cover, which will force people onto the public hospital waiting lists for ancillary services and the like. Also, if you put more pressure on private health funds, it makes them less attractive, and ultimately you end up with a shift to the public sector, which is not a good thing in itself, because of additional waiting lists and the like.
I just want to ask for some clarification on two particular issues. I note that the legislation allows APRA to raise an investigation into a private health insurance fund where there are concerns that it has not acted in the best interests of its members. In principle, I do not believe there is any objection to this. Some concerns have been raised, however, with the drafting of that particular clause and how widely it might be applied. One example that has been raised is the issue of increasing premiums. An argument could be made that, in and of itself, paying more is not in the best interests of a fund's members, even though the fund is legally allowed to increase premiums. Of course, if a rise in premiums allows the fund to offer better services or to continue operating effectively, this should be taken into account. I would be grateful if the minister could clarify the application of this provision and how APRA may be able to use these powers. In other words, how broad will it be? How broad is it envisaged to be in respect of this?
While the minister is looking at that, I will just say parenthetically that issues that I raised in estimates about private health insurance affordability go to issues of prosthesis safety and quality and allegations of price gouging with prosthesis funding arrangements, where the private health funds, I think, have not been listened to sufficiently by government in terms of dealing with those issues. I think that dealing with those issues will be unambiguously good for both health consumers and private health funds. If there are less than optimal or, shall we say, somewhat dodgy prostheses, why are they getting funding? Why are they on the market? We have had two inquiries into this in respect of the TGA.
So my question is: how broad is this provision in respect of this, and how will it be used?
I am advised that the existing provisions are reflected but that there is not a change to the scope of the things that might be investigated and that they primarily relate to prudential concerns.
I have a further question. I understand that PHIAC currently holds funds paid by private health insurance for its operation. Can the government please clarify what will happen to those funds and whether they will be allocated to APRA specifically for its oversight of private health insurers?
I am advised that the reserves will be transferred to APRA.
I have some other questions, around the premium-setting arrangements. In your second reading speech, Minister, you indicated that you thought that there would be no change, I think, to premium-setting arrangements. So can you explain what the arrangements will be and how the new arrangements will operate?
The premium-setting arrangements will operate as they do now. There is not a change.
Bills agreed to.
Bills reported without amendments; report adopted.
I move:
That these bills be now read a third time.
Question agreed to.
Bills read a third time.
The Excise Tariff Amendment (Ethanol and Biodiesel) Bill 2015 reforms the taxation treatment of the biofuels ethanol and biodiesel. As part of this reform, the Energy Grants and Other Legislation Amendment (Ethanol and Biodiesel) Bill 2015 abolishes the cleaner fuels grants scheme. Labor supports these bills and their intent to create a sustainable taxation framework for biofuels.
Domestically produced and imported biodiesel and ethanol are currently subject to the same rate of excise as petrol and diesel. However, producers and importers are able to access a grant for the full amount of duty paid. The cleaner fuels grants scheme refunds excise and excise-equivalent customs duty paid on both imported and domestically produced biodiesel. Similarly, the Ethanol Production Grants scheme, which refunds excise paid on ethanol to domestic producers, will close at the end of this month.
In place of the cleaner fuels grants scheme and the Ethanol Production Grants scheme, the excise payable on the domestic production of biodiesel and ethanol will be reduced to zero for one year from 1 July 2015. The excise rate will then gradually increase from 1 July 2016 to reach a reduced excise rate for domestic producers. The new final excise rate for ethanol will be approximately 33 per cent of the excise rate for petrol and will be reached in the financial year 2020-21. The new excise rate for biodiesel will reach 50 per cent of the full rate of excise that applies to petrol and diesel.
Government amendments to this legislation will see a longer transition process for the biodiesel industry. The amendments will ensure that excise duty on biodiesel will increase in equal increments until reaching a final rate of 50 per cent of the diesel rate in the financial year 2030-31 and for later financial years. Imported biodiesel and ethanol will be subject to the full fuel duty rate, giving a comparative advantage to local industries.
Ethanol and biodiesel make an important, albeit small, contribution to our liquid fuels mix. I thank the Biofuels Association of Australia and the member companies that have worked to ensure the sustainability of their industry. Labor supports reasonable measures to protect this industry and welcomes the government's willingness to negotiate in the interests of this industry.
Initially we had grave concerns about the state of this bill. In its original form it was proposing to slash the support the government has been providing to both the ethanol and the biodiesel industry—and that was of course in keeping with their hatred of clean energy generally. We have seen their attacks on wind farms just in the last week. We know that the government are trying, later today, to slash the renewable energy target and that they have repealed the mining tax and slashed the carbon price. So it was no surprise that this government was once again trying to weaken support for cleaner fuels—because it just does not get the need to transition to a low-carbon economy and does not understand that we can sustainably provide biodiesel and ethanol while ensuring that it does not compete with food-producing land or incentivise land clearing.
I am really pleased that, thanks to some excellent advocacy by, in particular, the Biofuels Association, the government and the opposition have agreed to amendments to this bill. I understand those amendments will allow a 15-year transition period to the reduced rate of excise that is now to apply to biodiesel. My understanding is that the industry now feel that they will not be kneecapped anymore and that their industry will in fact now be able to persist, given this longer transition period.
We maintain our extreme concern about the extent of climate change denialism in this government. We maintain the urgency of the need to transition to a low-carbon economy. Biofuels and ethanol are of course part of that transition, particularly if they are not competing with food-producing land or having impacts on land clearing or biodiversity. We know the industry can meet those parameters. The Greens have long supported cleaner fuels and, given that the industry is now content with the much longer phase-in period for this change to excise, we will be supporting this bill.
I also rise to speak in support of the Excise Tariff Amendment (Ethanol and Biodiesel) Bill 2015, particularly because the bill now lays out a longer transition period for the excise rate for biodiesel. I am pleased that the government has amended this bill in the other place in order to achieve this transition to protect the local biofuel industry. The original provisions of the bill really laid out a worrying future for the industry and would have wound back, very significantly, the local industry. So I am very pleased that this bill, as it has come to the Senate, has provided for that longer transition.
The importance of biofuel and biodiesel is very significant in our transport mix. It is important that we are cleaning up our act and shifting our economy to a zero carbon economy as quickly as possible, and that means that the transition needs to occur across all energy sectors. Transport of course is no exception. Transport in Australia is the fastest growing source of our carbon pollution and, depending on what part of the country you are in, it ranges between 14 and 17 per cent of our emissions. So we need to be acting on our transport fuels. It is going to be the economically and environmentally responsible action and direction to be taking in order to create a clean energy future for our children and our grandchildren.
We consider that clean electricity from renewable energy is probably going to be the main game as we shift our transport fuels. We will be shifting to electric vehicles for cars; there is also the prospect of electric trucks, which have now been introduced into Australia. There is going to be significant potential from biofuels as a cleaner alternative fuel source. I recently had the opportunity to meet with a manufacturer of biodiesel, ARfuels, who are based in Barnawartha in north-east Victoria. They have a thriving business producing biofuels, supporting local jobs in their rural community. They are there in Barnawartha in regional Victoria, and there are other biofuels manufacturers across regional Australia, because they are co-located with animal agriculture that is providing the tallow, which is the input for their biodiesel production.
When I met with ARfuels, they were very concerned about the bill in its original form; very concerned that in fact, as it was originally conceived, they would have gone under. They would have no longer been able to produce biodiesel and no longer able to provide jobs in their local community. So I am pleased that with the longer transition periods, they will have much more certainty under the provisions of this bill and they will be able to build their biodiesel manufacturing.
The other major source that is going into biodiesel manufacture at the moment is waste cooking oil. When I was a councillor on the city of Maribyrnong, we had a massive problem with waste cooking oil. For many restaurants in my home town of Footscray, it cost them to dispose of their waste cooking oil. We had big problems with waste cooking oil being illegally dumped into drains, causing blockages of the drains, health problems and massive waste problems. It was a real initiative that met the waste problem and also helped with the production of an environmentally sustainable transport fuel when the initiative to begin collecting that waste cooking oil for the production in diesel oil began. That is also the sort of initiative that is being supported by just giving some incentives for the ongoing production of biodiesel. Using these waste products for producing a renewable energy source makes so much sense. What is needed, of course, is a level playing field with fossil fuels.
The other real issue, as well as electricity as a renewable energy source to potentially be used as a transport fuel and the use of biodiesel, is to be helping with Australia's fuel security. I have been on the Senate inquiry into fuel security and the big issue is that we do not have enough supplies of petroleum products in Australia. We only have 30 days supply whereas the internationally recognised amount of supply that we should have is 90 days. In order to deal with that as an issue, we really have two ways to go. We can either increase the amount of supply and the amount of storage that we have of our petroleum-based fuels or we can shift away from those petroleum fossil based fuels and produce more renewable transport fuels ourselves here in Australia. That latter direction is much more consistent with the shift to a zero carbon economy. I do want to note that biofuels really are only a desirable fuel so long as they are from genuine waste products—for example waste that it is not derived from native forests.
We also need to make sure, when we are creating those biofuels, that they are not competing with land and water that should be used for food production. It is incredibly important that prime agricultural land is still used to produce food. There are so many opportunities for the use of biofuels from waste and waste products, and from land that is not suitable for agriculture. They are the directions we need to be heading in.
As I said, it is important, in terms of the support for biofuels, to note that we still do not have a level playing field; we still have massive subsidies for fossil fuels in the Australian economy; $10 billion over the forward estimates. So, if we are going to be properly encouraging the use of biodiesel, we need to be addressing and removing those fossil fuel subsidies. We need to be looking at our overall fuel energy mix and how we are supporting clean energy alternatives. So, alongside our support today for the biodiesel and biofuels sector, the Greens are going to continue to call on the government to drop those huge handouts it provides in the form of fossil fuel subsidies.
I want to make a final point about the economics of supporting biofuel production and our shift to a zero carbon economy—that is, it not as if there are costs in making this change that are not balanced by what we are avoiding: the cost of climate change. It actually makes massive economic sense for Australia to play its role in tackling climate change in the world community. As media coverage over the last week has pointed out—and as the Greens know—the cost of not dealing with climate change is going to be an extraordinary imposition on the Australian economy.
Consider the costs of sea level rise; consider the costs of losing some of our tourist icons, like the Great Barrier Reef and the ski fields. The massive economic cost to the Australian economy is something we really need to be putting into the equation when we are considering the incentives that are required. We need to be looking at what is going to be really beneficial to the Australian economy as well as to the global environment. Thank you.
I am pleased to enter this debate in support of the bill to effectively put ethanol into the regular taxation treatment of fuels.
The government's role in facilitating the success of Australian industries has to be balanced against the government's debt, the cost of future prosperity of Australians and fiscal policies that do not maintain a sustainable trajectory back to surplus. Of course getting the budget back to surplus is this government's principle goal in this term of parliament. For those reasons, the government has decided to move domestically produced fuel ethanol and biodiesel into the excise system and apply excise with reference to energy content. This approach is consistent with the government's approach to alternative fuels and will ensure that fuels are taxed fairly and transparently.
The approach in these bills recognises both that biodiesel is a close substitute for conventional diesel and that fuel ethanol has a lower energy content than petrol or diesel. This treatment in respect of domestically produced biodiesel and fuel ethanol is consistent with Australia's longstanding government policy to tax alternative fuels at half the energy equivalent rate. This policy recognises not only the potential benefits of these alternative fuels but also the desirability of tax neutrality across alternative fuels. This puts in the hands of Australians the choice of fuel; rather than it being dictated by its tax treatment. But biodiesel and ethanol will still be treated more favourably than other fuels, and I am hopeful that that will mean that some of the proposals for increased ethanol production from sugarcane will reach fruition.
The growing of sugarcane is one of the major industries of North Queensland, the state I represent in this Senate—not only growing sugarcane but manufacturing raw sugar from the sugarcane and sending it to the various mills up and down the coast of Queensland. The raw sugar industry has been going in Queensland for more than a century and has been the reason for much of the decentralisation of Queensland.
Cane has been one of the sustainable and longstanding crops that support so many communities in Queensland—towns up and down the Queensland coast. Originally it was around Maryborough, Childers and Bundaberg; then up to Sarina, Mackay, Proserpine, Ayr, Home Hill—where I live in the Burdekin district—Ingham, Innisfail, Mossman and, more recently, the Atherton tablelands, around Mareeba and Atherton. So it is a very important industry to Queensland.
It of course has its ups and downs—with the world market price and with various climatic conditions at times. Although climatic conditions are not as critical these days as they were in the past. In the area where I live—the Burdekin delta, Ayr and Home Hill—we irrigate all of the sugarcane from the Burdekin River dam, an initiative of Malcolm Fraser when he was the Liberal Prime Minister of Australia. That has meant that the industry in the area I am from is particularly sustainable. There are very good arguments for additional dams in the north of Queensland that could drought-proof various other parts of the sugar growing industry, around Mackay, Ingham and elsewhere, which at times do have difficulties with lack of rainfall.
But there are opportunities for new uses of sugarcane and that is where this bill before the parliament is relevant. There is a group based in Ingham, just north of Townsville, called the North Queensland Bio-Energy Corporation which is looking at additional uses for sugarcane in biofuels and ethanol, and looking further into plastics and other innovative uses of sugar. I believe John Hewson is now a director of that company. I know that the company—very well-led by Mr Robert Carey—is seeking financial support for this entity as it goes into so-far-uncharted waters. If it does get off the ground with a flourish, then it will be very good for the economy of North Queensland and northern Australia, and will provide yet another use for sugarcane.
In my own community of Ayr, Mr Geoff Cox has for years been looking at the financial viability of another sugar mill in that town, mainly focusing on ethanol rather than raw sugar production. It has never been easy, but these pioneers of northern Australia continue to work towards a whole new use of sugarcane.
Just last Friday, at the launch of the northern Australia development white paper in Cairns, I met up with Mr Peter Scott, the mayor of the Cook Shire. For those who are not aware, the Cook Shire covers most of Cape York Peninsula and it is based, obviously enough, in Cooktown. The mayor was telling me that there is a real opportunity for another dam at Lakeland Downs; a dam in that area could secure additional agricultural production, including sugarcane, in that part of the world. This would be a great boost to employment, and therefore population, in the north and it would give jobs to many people, including many of the Indigenous people of Cape York. Regrettably, at the moment the area does not have the economic activity up that way that would support long-term sustainable employment for many of the Indigenous people in Cape York.
I sometimes wonder at people in this chamber and elsewhere in the community who seem to be doing their damnedest to stop opportunities for employment for Indigenous people, particularly in Cape York. Just recently I noticed the ABC running a story headed, 'Knitting nannas trek Cape York in stand against coal seam gas industry'. The article on the ABC says:
Environmental activists, the Knitting Nannas Against Gas and Greed … will walk along the deserted and often dusty roads of Queensland's Cape York Peninsula in protest of the coal seam gas … industry.
That is very interesting, because there is no coal seam gas industry in Cape York—as I understand it, there is no coal seam gas in Cape York and there was certainly never ever any intention of having a coal seam gas industry there—and yet this group of environmental activists, no doubt encouraged by the Greens political party, is making this highly public trek up there to stop something that was never going to happen anyhow.
As well-intentioned, perhaps, as these people might be, as misinformed as they might be, it would be great to see their efforts used to address the real issues in Cape York, which is what I am talking about. Instead of opposing the non-existent coal seam gas, it is a pity these ladies and the Greens political party were not more interested in the huge unemployment in that area, the lack of infrastructure and services, the high youth suicide, the high prices and cost of living. All of these are worthy causes that the knitting nannas could address, but rather than do that they choose to address a non-existent issue, which they can obviously claim success for stopping as the coal seam gas industry is not likely to happen.
Senator Waters would know all about this; I have heard her talking about the non-existent coal seam gas industry in Cooktown. It always amuses me that someone obviously intelligent enough to be a member of this chamber can still not understand that there is not any intention—I do not think there is any gas up there; the early trials from many years ago showed that there was no coal seam gas up that way. Nevertheless, it is a political platform for the Greens political party and obviously the knitting nannas as well. But I urge the knitting nannas, if they want to do something seriously—I give them the credit of wanting to do something for Indigenous people in Cape York—then look at unemployment, the lack of infrastructure and services, the high youth suicide, and the high prices and cost of living because they are the real issues up there.
One of the ways that unemployment and suicide can be addressed is by new economic activities. Again, I mention the proposal for a dam around the Lakeland area on a river that runs out to the Coral Sea. That dam could double, treble or quadruple the amount of agriculture in the Lakeland area, and that could well include sugar for ethanol. So these are important issues for Australia.
That brings me to the issue of greater activity right across the north of Australia, where there is so much potential and so many opportunities abound. Naysayers will say, 'You did have an attempt at a sugar industry on the Ord some years ago, but it failed,' and certainly both of those statements are correct. But there were reasons for the failure, which I will not go into here, but they are not insurmountable problems that could not be addressed. Energy from ethanol and biodiesel are areas that could be looked at.
There were reports some months ago of a big Chinese development company buying into the Ord stage 2 in order to—as I recall from the newspaper articles—enter into sugar production for both raw sugar and energy purposes. I have not seen much further detail on that, and in the time this morning before this debate I have not been able to look further into it, but that is the sort of thing that I think that we need. I have no concern about it being an investment of a Chinese investment group into Australian land. Some people around the country will say, 'We're selling too much to the Chinese.' As I point out to them, they can never take the land back to China; it will always be in Australia, and whatever activities occur in places like that will always occur in a manner that is governed by Australian law: workplace and health and safety and conditions will always be governed by Australian law. I welcome that sort of investment, because it does in fact encourage investment into northern Australia. It encourages investment into agriculture that can be used for energy.
I am also aware of a group who have done a lot of work on the Gilbert River, which runs into the Gulf of Carpentaria. The Gilbert proposal is by a group called IFED, which is chaired by Mr Keith De Lacy. He was, many years ago now, a Labor Treasurer of the Queensland government, and he is now a very successful businessman. It is a proposal that is mainly agricultural, but it has an element of energy involved in it. It is a project that was more or less ready to go. Unfortunately, with the change of government in Queensland earlier this year, there was a bit of a pause on that project. There was a pause because, as you would know, Acting Deputy President Bernardi, in Queensland the Labor Party win elections because they get preferences from the Greens political party; without the preferences from the Greens political party, Labor would not win anything. In that way, the Greens political party always have this oversight—this final veto, one might say—on legislation that goes through any parliament where Labor is in charge and where Labor are there because of the preferences of the Greens political party.
The Greens have never liked this particular proposal; everybody else does, but the Greens political party and the Wilderness Society are totally opposed to it. I understand that there was a pause on that IFED proposal. I understand that a lot of work has been done, and there has been a bit of internal friction within the Labor government. The last news that I had was that it could go ahead with some other restrictions. But that would be good news, because that is another project in the north of Australia involving agriculture and involving alternative forms of energy that could be of particular use.
So whilst some would say that this legislation is putting an excise on ethanol that has not been there before, it is important to note that at all times under this regime, under these bills, there will be a concession to the ethanol industries so that you should always be able to buy blended ethanol petrol cheaper than the full price of petrol. This legislation retains that concession to the ethanol industry. While it is a long-term project, there are a lot of difficulties with the ethanol industry; one of them is getting enough ethanol to mandate a greater percentage of ethanol in petrol. But these things will be improved in an incremental way. In Brazil ethanol is a huge component of fuel, but the sugar industry in Brazil at the moment is in very, very dire straits. That does show that ethanol production is not the panacea for growing sugar cane. I think that these bills deserve the support of the parliament, and I would certainly urge that senators do vote for the bills.
I rise to oppose the Excise Tariff Amendment (Ethanol and Biodiesel) Bill 2015 and the Energy Grants and Other Legislation Amendment (Ethanol and Biodiesel) Bill 2015. Specifically, I rise to condemn the Liberals, the Nationals, Labor and the Greens.
And me.
Each of these parties supports these bills. I accept that interjection from Senator Xenophon; I condemn him as well.
These bills are some of the worst to be put to the parliament this term. The bills introduce a high effective tax rate on imported ethanol and biodiesel, to align with the tax on petrol and diesel. This is to occur in nine days' time. The bills gradually introduce an effective tax rate on domestically-produced ethanol and biodiesel, with the final tax rate on ethanol representing only a third of the tax on petrol, and the final tax rate of biodiesel representing only a half of the tax on diesel.
The bills hit motorists hard, but the Liberals are silent on this, despite their claims to being a low-tax party, because they realise that, to improve the budget position, the path of least resistance is to increase tax. By introducing a significant wedge between the tax treatment of imported and domestically-produced product the bills represent a bold return to protectionism. There is not a murmur about this from Labor, which has a proud history of reducing protectionism to the long-term benefit of Australian businesses and consumers. The support of the Greens for the bill is expected. They rail against tax concessions for superannuation, but they will happily accept a tax concession for biodiesel over diesel. And the support of the Nationals is also expected—they will support any handouts to farmers, no matter how perverse, including mandating the inclusion of ethanol in fuel, irrespective of the economics and how market-distorting it is.
The Liberal Democrats are the only supporters of free trade, low tax and the abolition of corporate welfare in this place. The other parties should hold their heads in shame.
I too stand condemned by Senator Leyonhjelm. I appreciate that he condemned me as well, because I actually think that the Excise Tariff Amendment (Ethanol and Biodiesel) Bill 2015 and the Energy Grants and Other Legislation Amendment (Ethanol and Biodiesel) Bill 2015 are good pieces of legislation. This is about fuel security. It is about more Australian jobs. It is about a net economic benefit, net of any subsidies and grants, because we need to look at some of the economic evidence. The Deloitte Access Economics report of 19 February 2014 concluded that the domestic biodiesel industry had a total contribution of $64 million and leveraged 438 full-time-equivalent jobs, net of all subsidies. Significantly, most of these jobs are in regional Australia. I am reading from a very good briefing paper, the biodiesel excise briefing paper, provided by the Biofuels Association of Australia.
I think we need to set out the history of this. The former government did the right thing in terms of biodiesel by giving it a chance to grow and a chance to increase the fuel security of this nation. The inquiry that was instigated by Senator Madigan on fuel security has been quite revealing in terms of how tight things are for our domestic fuel supply: we are only one or two ships away from serious fuel shortages, particularly in my home state of South Australia. I think that we need to put this in context. If the use of biodiesel involves cleaning up waste products, including tallows, waste vegetable oils and used cooking oils, these feedstocks do not compete for agricultural land or water. On that basis, it is a good thing to do in environmental terms.
I was quite shocked that in its budget last year the government essentially took away the support for this industry, and there were real issues of sovereign risk. I thought the coalition was all for businesses—regional enterprises in particular—being able to grow and prosper. You kicked the guts out of them with last year's budget. This is an attempt to try and wind it back to some degree, so that there is at least an element of hope for this industry. In terms of what is being proposed, my understanding is that the bipartisan agreement that was ripped up in the budget last year would have allowed for no taxes on this industry. That was brought forward to five equal steps in five years to a 50 per cent excise. That is an absolute deal breaker. It is destructive of this nascent industry that deserves to grow for environmental, fuel security and economic development reasons.
What is now being proposed, as I understand it, is to change this to equal instalments over 15 years. My understanding is that there is an amendment to this effect, and that amendment forms part of this bill as a result of a bipartisan agreement between the major parties. I think the Greens are supportive of that, because it at least gives this industry a chance to succeed.
I would have preferred the earlier arrangements. I thought the arrangements made by the former government were good arrangements for this industry. Millions of dollars were invested on the basis of the previous rules. ARfuels has raised over $25 million in equity funding and over $20 million in debt funding to invest in the biodiesel industry. This ASX-listed company has directly invested over $45 million of shareholder's funds since December 2011. What happened with the budget? Sovereign risk. They got kicked in the guts and their share price collapsed as a result of a budget move that was in clear breach of a bipartisan commitment back in 2011. According to the biodiesel excise briefing paper, all that money has been invested in the Australian biodiesel industry in new capital facilities and upgrades to existing facilities, in addition to employing a workforce to operate the business. I note that ARfuels has plants in limbo in Adelaide, at Largs Bay, and also in Western Australia, at Picton. Both those plants will employ in the order of 15 full-time jobs, as I understand it. This legislation needs to goes through for those jobs—those precious jobs in our home state of South Australia—to have a chance to be taken up.
I think we should point out that biodiesel not only has the direct economic benefit of picking up waste such as fish and chip oil. The idea of the oil from fish and chip shops being recycled in a way where the particulate pollution is 74 per cent less than ordinary diesel is also an important factor. That is why it should be encouraged. I also think it is worth noting that, previously, some big mining companies were importing biodiesel directly, presumably from places such as Brazil. They were getting the cleaner fuels grant, as well.
Those countries could have been importing biodiesel from countries that provided a subsidy for their biodiesel and they were getting the cleaner fuels grant as well. I think that smacks of double-dipping and it is completely undesirable from a public policy point of view and from those companies that do not have to pay the excise anyway because they are exempt because they are off-road vehicles. That is an outrageous rort and, if companies such as BHP and Rio were doing that, they should hang their heads in shame. It also goes to show that local businesses that were producing biodiesel were at a real disadvantage in respect of this. So, in so far as the government is getting rid of that rort—and it is a rort—I welcome this legislation.
I also note that, in terms of the net economic impact, it is very clear from the Deloitte Access Economics report of February 2014 that:
if the domestic biodiesel industry was operating at capacity, the potential economic contribution of the industry would be $194 million and 1,273 FTE jobs, net of all subsidies—
let alone the multiplier effect in regional communities where the actual job impact would even be greater and even more beneficial.
I can indicate that I do support this bill. I wish that the government would go back to the agreement it struck with the former government back in 2011. I thought that that was the preferred outcome. I do support the fact that the rorting that some big mining companies were engaged in—legal rorting, I should emphasise—of importing biodiesel directly from countries that subsidise their biodiesel and getting a cleaner fuels grant as well when their vehicles are exempt from excise because they are off-road vehicles is pretty outrageous. At least that has been dealt with as well.
I hope that ARFuels' investors and debt providers will get some certainty with this piece legislation and that we do not tamper with this anymore; or that, if we do alter this legislation, it is altered in a way that makes it more attractive for biodiesel in this country. There is that imperative of fuel security that I do not think, as a nation, we have dealt with very well either federally or at the state level.
I look forward to the amendment being passed, which I strongly support, which gives at least some breathing space and a fighting chance for this industry. I hope that ARFuels and other similar companies that produce biodiesel in this country have a chance to prosper as much as they can with this legislation. I am looking forward to those 15 jobs in Largs Bay in South Australia.
Firstly, I would like to thank all those senators who have contributed to this debate. These bills implement the government's 2014-15 budget measures to reform the taxation treatment of biodiesel and ethanol. These measures have been amended to provide additional transitional assistance for domestic biodiesel producers to assist that sector in adapting to these excise changes.
Following some further discussion with industry, further amendments are being made in the Senate to provide a slower phase-in of the rate of excise. As a result of the amendments yet to be moved, the fuel tax rates for biodiesel increase in a straight line manner from 1 July 2016 until 1 July 2030 when the excise right for biodiesel will be approximately 50 per cent of the excise right for diesel. The extended phase-in for biodiesel producers will provide additional support to that industry while it continues to develop and grow.
The government's amendments balance the support for the biodiesel industry against the need for a sustainable approach to the budget going forward. The phase-in of excise gives these producers time to adjust while encouraging their businesses to be self-supporting in the future.
These bills also abolish the cleaner fuels grant scheme, which refunds excise and excise equivalent Customs duties paid on both imported and domestically produced biodiesel. In addition, the Ethanol Production Grants scheme, which refunds excise paid on ethanol to domestic producers, will cease on 30 June 2015.
The government is continuing to provide support to Australian producers of ethanol and biodiesel while ensuring that responsible decisions are made to continue the path back to a budget surplus. Continued support for these industries highlights the role of ethanol and biodiesel producers in maintaining diversity in Australia's fuel mix and future energy security. I commend these bills to the Senate.
Question agreed to.
I move government amendment:
(1) Schedule 1, item 4, pages 4 and 5 (table items 2 to 6), omit the table items, substitute:
I also table a supplementary explanatory memorandum relating to the amendment that I have just moved to the Excise Tariff Amendment (Ethanol and Biodiesel) Bill.
As I have just indicated in my summing-up speech, this parliamentary amendment extends the phase-in of the excise rate applying to domestically produced biodiesel by 10 years. This will provide domestic producers with a total of 16 years before the measure will be completely implemented at which time biodiesel producers will phase in excise rates—that is, 50 per cent of the rate that applies to diesel and petrol, consistent with Australia's alternative fuels taxation policy.
Especially during the initial six years of the phase-in of the excise rate for domestically produced biodiesel, this will occur in parallel with that for domestic fuel and ethanol. The extended phase-in will cost $6.5 million over the forward estimates period. This change will assist domestic biodiesel producers by providing them with more time to adjust their business models to an increase in the rate of excise while keeping the budget position on track.
Question agreed to.
The question is that the bill as amended be agreed to.
Question agreed to.
Bill reported with an amendment
I move:
That these bills be now read a third time.
Question agreed to.
Bills read a third time.
Labor supports the measures contained in this bill, the Law Enforcement Legislation Amendment (Powers) Bill 2015, as they provide clarification around powers, keeping faith with the original intent of the Australian Crimes Commission, the ACC, and the Australian Commission for Law Enforcement Integrity. The ACC and ACLEI have sought these legislative changes on the basis of their practical experience in working with the existing legislative regime, particularly with past charge examinations.
The bill contains safeguards that apply to hearings so that every Australian continues to enjoy the right to a fair trial and a fair hearing. The purpose of this bill is to amend the Australian Crime Commission Act 2002 to clarify the powers of the ACC examiners to conduct examinations and, similarly, amend the Law Enforcement Integrity Commissioner Act 2006 to clarify the powers of the integrity commissioner, supported by ACLEI, and to conduct hearings and to make a consequential amendment to the Public Interest Disclosure Act 2013, to ensure that the definition of 'designated publication restrictions' refers to the amended provisions in the ACC Act.
If I can move to the structure of the bill, the bill is divided into two schedules: schedule 1, divided into two parts, which introduces amendments to the ACC Act and to the PID Act; and schedule 2, which introduces amendments to the LEIC Act. As the relevant provisions of the ACC and the LEIC acts are similar, schedules 1 and 2 make similar amendments.
The background to this change is as follows. The ACC and ACLEI conduct examinations and hearings which may involve compelling a person to answer questions about matters or produce documents or things relating to an ACC special operation or special investigation into serious and organised crime activities or relating to an investigation into law enforcement corruption. These examinations and hearings enable the ACC and ACLEI to obtain information that would not otherwise be available or which could only be obtained after long and complex investigations. Examination material, for example, plays an important role in assisting the ACC to develop an understanding of how serious and organised crime operates, to analyse this information with other relevant information and to disseminate it to the Commonwealth state and territory partner agencies as part of an intelligence product. A person cannot refuse to answer a question, or produce a document or thing, in an examination or a hearing on the basis that it might incriminate them or expose them to a penalty. However, there are limitations on the circumstances in which answers can be used in evidence against a person in criminal proceedings or proceedings for the imposition of a penalty.
The powers of the ACC and ACLEI to conduct examinations and hearings have been considered in a number of recent cases, discussed below, including R v Seller and McCarthy (2013) 273 FLR 155 (Seller and McCarthy), X7 v Australian Crime Commission (2013) 248 CLR 92 (X7), Lee v NSW Crime Commission (2013) 251 CLR 196 (Lee No. 1) and Lee v R (2014) 88 ALJR 656 (Lee No. 2). These cases have placed limits on the use of the examination powers in certain circumstances in which they had been previously utilised. The bill is intended to address these issues to clarify the ability of the agencies to exercise their powers as before, in circumstances which government has stated are in accordance with the original policy intent.
I will now outline the ACC examination powers in relation to this bill. The following is a summary of the current operations of ACC examinations. An ACC examiner may conduct examinations as part of a special ACC operation or investigation. The examiner may conduct the proceedings as they see fit, allow legal practitioners to be present and determine when it is appropriate for a witness to be examined or cross-examined, and, while proceedings must be held in private, a witness must be informed of any others who are present.
The Evidence Act 1995 of the Commonwealth does not apply to such an examination, so common law rules of evidence, subject to the ACC Act provisions, apply. The examiner may make such arrangements as are necessary to avoid prejudice to the safety of the person summoned, or protect them from intimidation or harassment. The examiner has the same protection and immunity in exercising their functions as a justice of the High Court of Australia. The examiner is exempt from serving a record of written reasons for decisions to issue a summons under the ACC Act. Any report that sets out findings that an offence has been committed or makes a recommendation to institute a prosecution must not be made available to the public unless it is based on evidence that would be admissible in prosecution of a person for that offence.
Examiners have power to summon or compel witnesses to attend examinations and to give evidence on oath or affirmation when the board has made a determination of a special operation or special investigation. A person and their lawyer, if legal professional privilege does not apply, must not fail to attend or answer questions, where it is proven that a valid summons was issued, under penalty of fines and/or imprisonment. The person may challenge the validity of the summons when it is an element of the offence or as an abuse of process.
The person and their lawyer may also be held in contempt of the ACC for similar conduct towards the examiner, but the examiner must inform the person of their application, stating grounds and evidence in support, for it will be dealt with by the Federal Court of state or territory Supreme Court. It is an offence to obstruct or hinder the ACC or an examiner in the performance of their functions or to disrupt an examination or threaten any person present at the examination before an examiner. Double jeopardy does apply to offences under the ACC legislation in state and territory and Commonwealth offences.
A person appearing before an ACC examiner as a witness may not refuse to answer a question or produce a document or things on the grounds of self-incrimination, that is, the privilege is abrogated. Subsection 30(5) provides a use immunity for a person who, before answering a question or producing a document or thing, claims that it might tend to incriminate them or make them liable to a penalty. This type of immunity prevents self-incriminating information from being used directly as evidence against the person who provided it. The use immunity applies to criminal proceedings and proceedings for the imposition of a penalty other than confiscation proceedings or proceedings relating to giving false evidence. Derivative use immunity is not provided. This means that self-incriminatory material may still be used to obtain other evidence that would be admissible against the person. The ability to use derivative material from an examination does not automatically compromise a fair trial.
The ACC Act does not include any special provisions relating to questioning of a person facing a current or imminent charge or proceedings. It does not exclude the ACC from questioning a person in such circumstances nor does it explicitly allow it. As outlined separately in the committee consideration section of this digest, a parliamentary committee recommended amendment in 2005 to prevent the ACC from examining a person subject to criminal or confiscation proceedings on matters relevant to those proceedings.
The coercive powers may be considered to interfere with a person accessing a fair trial when the matter they are summoned to is a compulsory inquisitional process of examination instigated by the executive government. This may thus provide a real risk to the administration of justice. The prosecution does not gain an unfair advantage by mere fact that the examination occurs or does not occur, primarily due to the power of the examiner to prevent disclosure and ensure a fair trial for the accused. In other words, there is no real risk in the administration of justice due to the safeguards of the examination, even in the face of a person facing pending criminal charges regarding their answers when the examiner can utilise safeguards against disclosure to prosecuting authorities under section 25A of the ACC Act.
Mere dissemination of evidence to a prosecuting authority is not enough for a trial to be compromised, as it can only apply if it might prejudice a fair trial from occurring and is not enough for a trial to be stayed. To force the accused to confess their guilt or give away information that may provide for their defence or explain their conduct that allegedly supports the charges, depending on the nature of the proceedings, may prejudice a fair trial. Any relief would depend on the breach of direction or of where a direction should have been given and steps taken to cure its effect. The judicial officer could also use their discretion to exclude evidence under sections 90 and/or 138 of the Evidence Act 1995. However, recent cases regarding the use immunity of examination material have had their decisions reserved in the High Court of Australia, which has led judges in other cases to issue temporary stays of prosecutions.
Any dissemination is subject to and overridden by the examiner's non-publication directions, consistent with the decision of Australian Crime Commission v OK [2010] FCAFC 61, where a majority of the Federal Court upheld the legislation. The examiner determines whether confidentiality applies to evidence that is given or the fact that a person is going to give evidence and whether a non-publication direction should be given. The examiner is required to do this when a disclosure might prejudice the safety or reputation of a person or prejudice the fair trial of a person who has been, or may be, charged with an offence.
The court may seek that evidence directed to be confidential or not published be made available to a person charged with an offence before a federal, state or territory court if it is desirable in the interests of justice. The 'interests of justice' has no definition and can encompass a wide range of factors. When an examination is finished, the examiner must give a record of proceedings and any documentation or things given to the examiner in connection with the examination to the head of the special ACC operational investigation. These confidentiality directions apply also to disclosing notice for summons to obtain documents. The person themselves may be prevented from disclosing the notice other than to their lawyer or permitted person or body.
As outlined in the explanatory memorandum, several recent cases could affect the ACC's use of examination powers. These cases include those which follow. In Regina v Seller; Regina v McCarthy, the New South Wales Court of Criminal Appeal found that the use of evidence derived from examination material in criminal proceedings against the examinee could, in some circumstances, be unfair. In X7 v Australian Crime Commission, a 3 to 2 majority of the High Court found that the ACC Act did not authorise the ACC to examine a person who had been charged with an offence about the subject matter of the charge, referred to here as a post-charge examination. In this case, the majority noted that such an examination would affect the fairness of the examinee's trial and could only be authorised if there were clear words indicating parliament's intention. In Lee No. 1, a 4 to 3 majority of the High Court found that the New South Wales Criminal Assets Recovery Act 1990 authorised the post-charge examination of a person. The majority distinguished the decision in X7 on the basis that the relevant examination occurred as a result of court order. In Lee No. 2, the High Court unanimously found that the New South Wales Crime Commission's unlawful disclosure of the accused's examination transcript to the prosecution rendered the trial fundamentally unfair and ordered a retrial. The examination occurred before the accused was charged with an offence.
According to the explanatory memorandum, these cases have had an impact on the Australian Crime Commission's operations. Following the decision in X7 v Australian Crime Commission, for example, the Australian Crime Commission has stated that it no longer examines persons already charged with an offence if the questioning could touch upon related matters. The decision in X7 touches upon both the motivations of the current amendments and the balancing of rights and public interest in the area of criminal law. X7 v Australian Crime Commission [2013] HCA 29 is one of the more important of the recent cases that not only affected the examination powers of the Australian Crime Commission and ACLEI, but clearly identified the 'principle of legality', which requires that a statutory intention to abrogate or restrict a fundamental freedom or principle or to depart from the general system of law must be expressed with 'irresistible clearness'. It is upon this principle and the stated requirements for statutory intent that the bill has been brought forward to clarify the operations of the agency's examinations with the requested irresistible clearness.
The compulsory examination powers of the Australian Crime Commission and ACLEI will be clarified by the amendments proposed in the bill. They will provide the express words and the clear intent that recent decisions have indicated would be required to permit persons who have been charged with an offence to be examined on matters related to the offence. While the amendments would unavoidably alter the process of a trial by limiting an examinee's defence options, they will also introduce measures intended to protect the processes of justice and the right to a fair trial by limiting the use to which examination and derived material may be used. Labor supports law enforcement agencies having the appropriate tools and powers to combat serious and organised crime and law enforcement corruption while ensuring safeguards for fair trials and hearings. The proposed amendments are a proportionate response to provide this balance. I commend the bill to the Senate.
The Australian Greens do not support the enactment of the Law Enforcement Legislation Amendment (Powers) Bill 2015 as currently drafted. The bill seeks to amend the Australian Crime Commission Act 2002 and the Law Enforcement Integrity Commissioner Act 2006 to enhance the powers of Australian Crime Commission examiners to conduct examinations, and the Law Enforcement Integrity Commissioner, supported by the Australian Commission for Law Enforcement Integrity, to conduct hearings.
The conduct of hearings by the Australian Crime Commission, the ACC, and the Law Enforcement Integrity Commissioner has previously raised strong human rights and rule of law concerns and has been subject to consideration by the Senate Legal and Constitutional Affairs Committee and other parliamentary committees. These are non-judicial administrative bodies which are invested with exceptional powers—powers to compel a person, under threat of criminal sanctions, to answer questions that could have a material impact on the person's right to a fair trial if he or she is already, or may be, charged with a criminal offence. This can have the effect of limiting the person's right not to incriminate himself or herself.
The changes proposed in this bill seek to expand the powers of these bodies to conduct coercive hearings that they must attend, and to deny people attending those hearings the right to silence, even in circumstances where the person has been charged with a criminal offence and will face a judicial process in the future. In doing this the bill significantly limits a person's right to a fair trial, particularly by affecting the equality of arms principle and the protection against self-incrimination.
As the Law Council of Australia has summarised, the bill authorises an Australian Crime Commissioner examiner to conduct an examination in many circumstances—pre-charge, post-charge, pre-confiscation application and post-confiscation application—and to compel answers to questions relating to an ACC special operation or special investigation into serious and organised criminal activity. Further, it authorises the Integrity Commissioner to conduct a hearing pre-charge, post-charge, pre-confiscation application or post-confiscation application, and to compel answers to questions relating to an investigation into law enforcement corruption.
In such an examination or hearing a person cannot refuse to answer a question or produce a document or thing on the basis that it might incriminate them or expose them to a penalty. The changes also seek to respond to a number of judicial findings, including findings in the High Court. These findings have made it clear that the compulsory examination of a person who has been charged with an offence about the subject matter of the pending charge does constitute a fundamental alteration to the process of criminal justice in Australia, given the accusatorial nature of criminal justice. These High Court cases have brought the validity of post-charge investigations into question. Rather than heed the concerns of the High Court in this regard, this bill seeks to clarify with clear statutory language that the parliament intends to alter the process of criminal justice in Australia in this fundamental way. These are very serious issues. They have given rise to concerns by a number of submitters that the changes proposed in the bill may be open to constitutional challenge. Indeed, the bill appears to have been drafted with this possibility firmly in mind. There are echoes of the citizenship debate in this very bill.
Let me be clear. The Australian Greens take seriously the need to address, disrupt and prevent serious and organised crime in Australia. The Australian Greens acknowledge that the coercive examination powers of the ACC and the Law Enforcement Integrity Commissioner are not designed to determine a person's guilt or innocence, but rather to disrupt and prevent serious and organised crime and to prevent suspects from disposing of valuable information about current criminal activities, operations and practices of others that may otherwise be lost. The information provided by the ACC and the Law Enforcement Integrity Commissioner suggests that the X7 case and other judicial findings have had a significant negative impact on the operations of the ACC and the Australian Commission for Law Enforcement Integrity. The Australian Greens agree that this is relevant and important information to consider. However, the Australian Greens also take seriously the traditional common law rights that are integral to ensuring that a person receives a fair trial, including the privilege against self-incrimination and the right to silence. These principles are entrenched in both common law and international human rights law—and are expertly outlined in submissions by the Australian Human Rights Commission to the Legal and Constitutional Affairs Legislation Committee inquiry into this legislation. The right to a fair trial is also protected by the constitutional principle of legality whereby 'clear and unambiguous language is needed before a court will find that the legislature has intended to repeal or amend' this fundamental right.
Ensuring that a defendant is able to present his or her defence in the manner that he or she chooses is an important component of the concept of equality of arms and is a principle that has defined our criminal justice system for decades. The changes in this bill risk providing the prosecution with information that can be used against a defendant when he or she is facing serious criminal charges. This is because derivative use immunity is not provided for in the bill. The practical consequences of this are that material obtained as a result of an ACC examination or a Law Enforcement Integrity Commissioner hearing can be used to obtain other evidence that can later be used in court against the person. In other words, the prosecution is able to gain an unfair advantage inconsistent with the longstanding 'equality of arms' principle.
Both the Law Council of Australia and the Australian Human Rights Commission have raised serious concerns with key features of the bill. These issues relate to whether the Australian Crime Commission and the Australian Commission for Law Enforcement Integrity should be permitted to conduct an examination or a hearing after the person subject to the process has been charged with a related offence or such a charge is imminent; and whether the ACC and Australian Commission for Law Enforcement Integrity should be allowed to disclose information to a prosecutor which has been received from post-charge examinations and hearings.
In weighing up the need to protect the right of an examinee or witness to a fair trial and the need to ensure that the ACC and Australian Commission for Law Enforcement Integrity are not adversely hindered in the performance of their respective roles the Australian Greens are not confident that a fair and appropriate balance has been struck in this bill as currently drafted.
As the Law Council of Australia explains, despite the existence of some safeguards, there is a real risk that the administration of justice will be interfered with by coercively requiring a person to answer questions designed to establish that he or she is guilty of the offence with which he or she is charged and then providing that information to a prosecutor. This risk also means that there is the potential for certain provisions in the bill to be beyond the legislative power of the Commonwealth— that is, unconstitutional. As noted by a number of submitters, including no less than the New South Wales Office of the Director of Public Prosecutions, the inclusion of the severability clauses implies that the drafters of the bill expected that key provisions of the bill could be made subject to judicial scrutiny should the bill be passed in its current form. This leads to an unsatisfactory level of uncertainty about the state of the law in an area that may have very serious implications for the investigation, disruption and prosecution of serious and organised crime and for the fair trial rights of those who have been charged with such activity.
The bill does not include any safeguards to limit the proposed power to conduct post-charge examinations and hearings. This means that an affected person would have limited recourse to the courts in circumstances where a post-charge investigation unduly interferes with their right to a fair trial. This is particularly significant given the nature of the proposed changes in the bill which will significantly expand the circumstances in which such examinations and hearings can be conducted These changes effectively mean that where a defendant has been charged or is about to be charged for any offence, including a low-level crime, they can be examined about this and other matters. The bill allows the Australian Crime Commission and the Australian Commission for Law Enforcement Integrity to disclose to a prosecutor information obtained through a post-charge examination or hearing. While these disclosure powers come with some safeguards, such as the requirement that a court order must precede a disclosure, they are likely to be of limited practical effect. As the Law Council of Australia notes, this is because the court will be asked to make an order authorising disclosure before having the opportunity to hear how such an order may impact on the conduct of the defence case.
In light of the above concerns, the Australian Greens recommend that the bill not be passed in its current form. The Australian Greens also support recommendations made by the Law Council of Australia to the Legal and Constitutional Affairs Legislation Committee inquiry into this legislation that the government should undertake a comprehensive review of the Australian Crime Commission Act which considers whether the act provides an effective and appropriate framework for the investigation of serious and organised crime and adequate protection of fundamental common law rights such as the right to a fair trial; and clarify to the parliament that this bill in its entirety is within the power of the Commonwealth Parliament to enact. For these reasons the Australian Greens do not support this bill.
This bill is a further step by this government to ensure that our police and crime detection agencies have every power at their disposal to address serious and organised crime. We as a government are determined to do what we can as a community to lessen the impact of those involved in serious crime, in organised crime. This bill is part of a series of measures by the government that underlie the basic tenet of ensuring that Australians are safe, that the community is as free as possible from the impact of all sorts of crimes. We only have to look around our country to see some of the results of what serious and organised crime can do to our society. The epidemic of ice—that horrendous drug which seems to be readily available—is the result of work by serious and organised crime. This government will do everything possible to address every element of the work of the crime tsars in our country.
This bill, the Law Enforcement Legislation Amendment (Powers) Bill, clarifies the power of the Australian Crime Commission to conduct compulsory examinations under the Australian Crime Commission Act. Secondly, it clarifies the power of the Integrity Commissioner, supported by the commission, to conduct compulsory hearings under the Law Enforcement Integrity Commissioner Act. Thirdly, it clarifies the uses to which the information and material obtained through the exercise of those compulsory powers may be put.
This bill, like all of those in this field, was sent to the Senate Legal and Constitutional Affairs Legislation Committee, which I chair, for consideration and examination. A number of submissions were made, which the committee looked at very closely. The committee then determined its view on this legislation. I want to thank Senator Polley for the speech she has given in support of the bill. I also thank Senator Collins, a member of the Legal and Constitutional Affairs Legislation Committee, for her support in dealing with this review and for joining the government in the recommendation. I should acknowledge both Senator O'Sullivan and Senator Bilyk, who are also members of that very hardworking committee which has looked into this.
The clarification I spoke of earlier is urgently required following a number of recent court decisions—most notably by the High Court in Lee v The Queen, and in X7 v Australian Crime Commission, and by the New South Wales Court of Appeal in cases referred to as Seller & McCarthy—which raised questions about the scope of those powers as intended by parliament and as expressed in the act.
The Commonwealth Director of Public Prosecutions gave evidence to the committee which suggested that there are at least 11 matters in which those court cases are or may be the subject of a defence challenge to the prosecution, including through temporary and permanent stay applications. This is obviously creating very considerable delays for effective prosecutions and has placed enormous strain on the resources of the Commonwealth Director of Public Prosecutions and those of the investigative agencies. Because case law is necessarily confined by its facts, the judgements arising from those challenges will be at best incrementally clarifying and at worst inconsequential. Amending legislation was the only cure. The Office of the Commonwealth Director of Public Prosecutions said in their evidence that the bill was intended to make it clear that, where it is lawful to do so, pre-charge examination or hearing material given by an accused to an investigating agency may be disclosed to the prosecution even if that material is not directly admissible as evidence against the accused. The CDPP also went on to say that, subject to certain limitations, derivative material that has been lawfully obtained from an examination or hearing may be disclosed to the prosecution, and is admissible in evidence against the examinee. While there may still be issues in identifying precisely what was derived from a particular examination or hearing, this aspect of the bill should assist in reducing the number and scope of the kinds of defence challenges which have arisen in prosecutions since the decisions in Seller & McCarthy.
The bill comprises two schedules, which propose amendments to the Australian Crime Commission Act and to the Law Enforcement Integrity Commissioner Act and make a consequential amendment to the Public Interest Disclosure Act. Schedule 1 of the bill proposes amendments that would affect the Australian Crime Commission's examination powers, while schedule 2 of the bill proposes amendments that would affect the Integrity Commissioner.
In the summary of its submission to the committee, the Australian Commission for Law Enforcement Integrity said that:
Schedule 2 of the Law Enforcement Legislation Amendment (Powers) Bill 2015 focusses on clarifying the Integrity Commissioner's powers to conduct coercive hearings and implements safeguards to ensure that the coercive hearing process and the disclosure of derivative material does not affect the fair trial of a witness. ACLEI welcomes the proposed amendments which will provide greater clarity about the hearing process and use of information obtained through that process.
Some have suggested that this bill considerably expands the powers available, but it should be noted that the bill does not give ACLEI any new coercive powers or expand its current powers. Rather, having regard to the decisions and guidance of the High Court in relation to the fair trial principle, the measures restore, clarify and sustainably restrain the Integrity Commissioner's coercive information-gathering powers to the way they were originally planned. The safeguards are an appropriate balance that retains and supports the operational objectives for which the Australian Commission for Law Enforcement Integrity was established. The bill proposes a number of mechanisms to ensure that hearing powers, including dissemination and derivative use relating to hearing material, do not interfere with a witness's right to a fair trial. These measures include prohibition, in some instances, through to increased judicial oversight and scrutiny.
The committee determined that this bill was a useful tool in the fight by our country against serious and organised crime. I regret to say that the recommendation of my committee was not unanimous. The Greens political party representative on the committee has issued a dissenting report in which the Greens political party recommend that the bill not be passed and that a comprehensive review of the Australian Crime Commission Act be undertaken. They further recommend that the bill should be looked at to ensure that it is within the power of the Commonwealth parliament to enact. In relation to the second matter, clearly the government obtains the very best advice possible on these types of issues, and it is the government's view, according to the evidence presented to my committee, that it is within parliament's power. This is, I suggest, a similar issue to the removal of citizenship that is being spoken about and was referred to earlier in this debate. Again, the government does not bring forward these proposals unless they have full legal oversight and the very best legal advice as to their constitutionality.
The Greens political party's other recommendation, that there be a comprehensive review of the Australian Crime Commission Act, is, again, one of these approaches that we see so often from the Greens political party of, 'Let's not do this.' It is relatively urgent. The Director of Public Prosecutions has said so; the commissioner for law enforcement integrity has said so following recent High Court decisions. According to the evidence, which I have referred to, 11 matters currently before the courts could be delayed unless this sort of supporting legislation is passed. But the Greens political party want to have a review. So we will send this off to the never-never and perhaps in a year or a couple of years we will have a review and we would all argue about it—in which time how much more damage to Australian society would be done by serious and organised crime? As I said at the beginning of my remarks, these bills are all about giving our law enforcement agencies every opportunity, within our notions of justice and fairness, to bring wrongdoers to account.
I, of course, am of an age where, as young people, we used to talk about Nineteen Eighty-Four. It was a book written by someone I should know—a very significant book of the sixties and seventies.
Orwell.
George Orwell—thank you, Senator Birmingham. He also wrote Animal Farm, I think. In my youth, we used to read Orwell's book Nineteen Eighty-Four, and it depicted a society where on every street lamp there was a camera and everything you did was looked at by Big Brother. In those laissez-faire days of the sixties and seventies, we were all horrified that we might get to 1984 and that these things would be upon us. We are all absolutely certain that could never happen.
Of course, not quite to the extent predicted by George Orwell, we have gone a long way to where some of the normal freedoms we as a society have have been curtailed. I always ask: which impact on society is more important? Sure, we lose some of our freedoms and some of the rights that we may have had in times gone by, but we are fighting an enemy that is so much more organised and so much better resourced than it has been in the past—and that is serious and organised crime, which, I might say, interacts with and in many instances supports terrorism around the world. I have every confidence in the Australian Federal Police, in the Australian Crime Commission, in ACLEI and in all of the Commonwealth law enforcement agencies—and, I might say, almost all of the state enforcement agencies. They are very professional, fair people who do a job protecting society. But in their daily work they compete against serious and organised criminals, who know no rules and have no restraints on what they can do. They do not have any restraints on their resources—the money and the advice they can get, including the support of professionals in various fields such as accountants and lawyers. They have the money to get the very, very best of legal, accounting and other advice, but they do not have to worry about the rules that the police and our enforcement agencies have to worry about. If the police make one minor error in their investigation of a particular matter, it is a front-page headline and everyone is encouraged to think that our police are bad, naughty, corrupt or whatever for often very slight infringements of the rules—but they do have to follow the rules. Of course, as law enforcement people, they have no concern with and no argument against complying with the rules, but it does mean that, every time they go into the fight against serious and organised crime, they do it with one hand tied behind their back. These examinations that were introduced into the Australian Crime Commission Act some time ago have enabled the law enforcement agencies to turn the tables a little, but they are still governed by the law, which their opponents in serious and organised crime of course are not.
So, Mr Acting Deputy President, while in different times or different places—if we lived in a perfect world—some of these provisions that the government brings forward we may be a little uneasy about; but, when it is a question of the lives and welfare of my family or your family versus some of the freedoms we might have to give up, I know I will always go with those whose job is to protect me and my family and everyone else and their families from the ravages of serious and organised crime.
I sometimes give the Greens political party the benefit of the doubt that they are erring on the side of caution—
Not very often.
but, as you say, Senator O'Sullivan, I don't do that very often. Some of the attitudes and approaches of the Greens political party to people smugglers, terrorism and serious organised crime at times makes me wonder just whose side they are on. I will give them the benefit of the doubt, on this occasion, that they think there are reasonable grounds for opposing this bill. I certainly do not. I and the committee I chair urge that this bill be passed.
As the deputy chair of the Parliamentary Joint Committee on the Australian Commission for Law Enforcement Integrity, ACLEI, and—as Senator Macdonald mentioned—as a member of the Senate Legal and Constitutional Affairs Legislation Committee I will make some brief comments on this bill.
Serving on the ACLEI committee has given me insight into the tools that Australia uses to combat law-enforcement corruption and serious organised crime. These two challenges go hand in hand given that it is very difficult for one to succeed without the other. ACLEI refers to the relationship between corruption in law enforcement and organised crime as the 'corruption handshake'. That is why ACLEI's model of operation—where they retain core staff but co-opt staff from other Commonwealth agencies, according to their needs—is so effective. It enables these agencies to share specialist knowledge in the understanding of serious organised crime, in the case of the Australian federal police and the Australian Crime Commission, and corruption risk factors, in the case of ACLEI.
When ACLEI forms a task force, instead of jumping in early to remove corrupt staff from an organisation they observe them over an extended period and, in so doing, are able to form a picture of the criminal network in which they are involved. ACLEI, the Integrity Commissioner and the ACC conduct examinations and hearings as part of their special operations and investigations into serious and organised crime or law-enforcement corruption.
As deputy chair of the ACLEI committee, I have had the opportunity to visit ACLEI's offices and see firsthand the facilities they use to conduct their hearings. These hearings are an incredibly important and often used tool in combating crime and corruption. They give ACLEI and the ACC the ability to gain an insight into the way that organised crime works. The information they gain through hearings and examinations may not otherwise be obtained, except through lengthy and complex investigations.
In the last financial year, according to its annual report, ACLEI conducted 17 hearings and served 31 notices to produce information, documents or other such things. In the same period, the ACC conducted 263 coercive examinations. A person cannot refuse to answer a question or produce a document or such thing, in an examination or hearing, on the basis that it might incriminate them or expose them to a penalty. However, there are limitations to the circumstances in which evidence can be used against a person in criminal proceedings. For example, immunity is provided—in ACC examinations—that prevent self-incriminating evidence being used directly as evidence against the person who provided it, but self-incriminating evidence can be used to obtain other evidence that may be admissible against the person.
Several recent court cases have affected the powers of the ACC, Integrity Commissioner and ACLEI to conduct examinations and hearings. These are cases such as: R v Seller and McCarthy, X7 v the Australian Crime Commission, Lee v the New South Wales Crime Commission, and Lee v R. While not all of these cases concern the Commonwealth, they do make decisions about the use of coercive powers by state agencies, which have implications for the ACC and ACLEI.
In the X7 case, the High Court found—by a 3-2 majority—that the ACC was not authorised to examine a person who was already charged with a specific offence where the examination concerns the subject matter of the offence so charged. The key question in this case was whether the powers of an examiner were restricted by the 'right to silence' enjoyed by an accused in criminal proceedings. In the case of Lee v the New South Wales Crime Commission, the High Court considered the principles in the X7 case but found—by a 4-3 majority—that the post-charge examination of a person could be conducted.
Lee's case was distinguished from X7 in that the examination was the result of a court order, and the High Court found that the New South Wales Supreme Court had the discretion not to order the examination. The case of Seller and McCarthy found that evidence given under coercive powers could be unfair and therefore should not be considered in subsequent criminal proceedings. The second Lee case concerned an examination by the New South Wales Crime Commission that took place before the accused was charged with an offence. The High Court unanimously found that the unlawful disclosure of the accused's examination transcript to the prosecution rendered the trial unfair and ordered a retrial.
The limits these cases have placed on the examination powers of these agencies were not intended when the powers were legislated for. For example, following the X7 case, the ACC now no longer examines persons charged with an offence if the questioning touches on related matters. I am sure it was envisaged in the original legislation that the coercive powers of ACLEI and the ACC would not limit a person's right to a fair trial. I am sure it was also envisaged that witnesses coerced into giving answers and producing information or documents would be given appropriate immunity protections.
I do not believe it was envisaged that ACLEI and the ACC would be prevented from examining a person because the matters they are being examined about are the subject of criminal proceedings against them. The legal principle relied on—in the X7 case—is that a statutory intention to abrogate or restrict a fundamental freedom or principle or to depart from the general system of law must be expressed with 'irresistible clearness'.
The bill that is now before the Senate, the Law Enforcement Legislation Amendment (Powers) Bill 2015, offers this clarity. It is designed to restore the intent of the original legislation. This bill makes amendments to the Australian Crime Commission Act 2002, the Law Enforcement Integrity Commissioner Act 2006 and the Public Interest Disclosure Act 2013. It will clarify the powers of Australian Crime Commission examiners to conduct examinations and the Integrity Commissioner, supported by ACLEI, to conduct hearings.
The ACC and ACLEI are two very important and highly effective agencies when it comes to combating serious and organised crime in Australia. It is estimated that serious and organised crime costs our community some $15 billion a year. Over the last 12 months alone, the ACC has seized more than $23 million in cash, more than $150 million in assets, more than $386 million worth of drugs, and engaged in the disruption of 39 different criminal entities. One of the foremost responsibilities of a government is to protect the safety and security of its citizens. That is why we need to give our law enforcement agencies, particularly those charged with combating the most serious criminal activity, the tools they need to do their jobs effectively. It is also important that extraordinary powers given to agencies like ACLEI and the ACC are also balanced with protections for citizens. I am pleased that this bill contains safeguards that apply to hearings to ensure that they do not affect the fair trial of witnesses. With these protections in place, Labor supports the measures contained in this bill.
I would like to conclude by thanking all those who work in Commonwealth agencies such as the AFP, the ACC and ACLEI for the excellent work they do in tackling corruption in our law enforcement institutions and fighting serious and organised crime. It is a difficult and sometimes dangerous job and one which helps keep our community safe. I commend the bill to the Senate.
I thank the speakers who have contributed to the debate and I thank in particular Senator Collins for outlining the ALP's support for this bill. The Law Enforcement Legislation Amendment (Powers) Bill will ensure that the Australian Crime Commission and the Integrity Commissioner have the powers they need to combat serious and organised crime, foreign fighters and law enforcement corruption. The bill will place the existing powers and practices of the Australian Crime Commission and the Integrity Commissioner on a stronger legislative footing. It will also clarify that the Australian Crime Commission Act allows the Crime Commission to examine people who have been charged with an offence. The bill will also the improve the safeguards in the Australian Crime Commission and Law Enforcement Integrity Commissioner Acts to protect the fair trial of any person questioned, making them clearer and stronger.
I take the opportunity to reply to points raised in the debate by Senator Wright, in particular in relation to why these measures are necessary. These measures will ensure that the ACC and Integrity Commissioner continue to have access to necessary and appropriate questioning powers that allow them to play a vital part in the fight against serious and organised crime, foreign fighters and law enforcement corruption. The powers of the ACC and the Integrity Commissioner to conduct examinations and hearings have been affected by a number of recent cases, including X7 v ACC in 2013 and Lee v R in 2014. In the X7 case, the majority of the High Court found that the Australian Crime Commission Act did not authorise the examination of a person who had been charged with an offence about the subject matter of the charge. In Lee, the High Court unanimously found that the New South Wales Crime Commission's unlawful disclosure of an accused's examination transcript to the prosecution rendered the trial fundamentally unfair and ordered a retrial. These decisions have created significant uncertainty around when the ACC and the Integrity Commissioner can use their coercive questioning powers and disclose information obtained from their use. This bill will respond to these cases by amending the Australian Crime Commission Act and the Law Enforcement Integrity Commissioner Act to place the ACC and Integrity Commissioner's powers on a stronger footing. It will not give the ACC or Integrity Commissioner substantial new powers; rather, it will restore their powers to the way they were originally intended to operate and put them on a clearer legislative footing.
I also address the issue of whether these measures create new powers. The bill does not expand the powers of the ACC or the Integrity Commissioner; rather, it clarifies their powers and practices and places them on a stronger legislative footing. The ACC Act and the LEIC Act have always been intended to authorise post-charge examinations and hearings. The bill will restore the ACC's power to conduct examinations in these circumstances. It will also expressly empower the Integrity Commissioner to conduct post-charge hearings. The acts have also been intended to allow investigators to use examination and hearing material to find admissible evidence for use in prosecutions. The bill will amend the acts so that they specifically provide that the ACC and integrity Commissioner may disclose examination and hearing material to investigators for derivative use.
I also address issues in relation to safeguards, which were also raised in the debate, and most especially how the measures will ensure a person's fair trial. The right to a fair trial is one of the fundamental tenets of our criminal justice system. The ACC and Integrity Commissioner's powers have the capacity to affect the fair trial of a person, particularly if they are questioned post-charge. The bill will make the existing safeguards in the ACC Act and the LEIC Act to protect fair trial rights clearer and stronger. It will do this in a number of ways. Firstly, the bill will more clearly set out the circumstances when an examiner or the Integrity Commissioner is required to issue a direction, particularly where there are ongoing criminal proceedings against the person questioned. An examiner or the Integrity Commissioner must issue a direction to ensure the confidentiality of examination or hearing material and protect a person's safety and fair trial. It is a criminal offence to disclose or use information in contravention of such a direction. Secondly, the bill places specific limits on the circumstances when examination material, hearing material and derivative material can be provided to the prosecution. Where the person questioned has been charged with an offence, an investigator must seek the court's permission to disclose examination or hearing material to the prosecution. Where the examination or hearing occurred after the person was charged with an offence, an investigator must also seek the court's permission to disclose any material derived from the examination or hearing to the prosecution. A court may make an order if it is satisfied that disclosure is in the interests of justice and this would be most likely to occur where the evidence shows that the person is innocent or there are mitigating circumstances. Finally, the bill makes it explicit that courts retain their powers to make all orders necessary to prevent prejudice to the examinee or witness's fair trial. These orders could include refusing to admit evidence, temporarily staying the trial while a new prosecution team is appointed or any other orders that the circumstances require.
I also want to address the issue of what the safeguards are in relation to the conduct of post-charge examinations and hearings. This bill will build on the existing fair trial protections in the ACC Act and the LEIC Act. There are a number of levels of protection. The bill will clarify that an ACC examination can only be used as part of a broader special operation or special investigation. The primary purpose of examinations and hearings is to gather information for the purpose of understanding, disrupting or preventing serious and organised crime and law enforcement corruption. Examinations and hearings can only occur in support of a broader operation or investigation into serious and organised crime activity or a law enforcement corruption issue. In the case of an ACC examination, questioning will need to relate to an operation or investigation that the board has determined is special. An examination or hearing cannot be used solely to bolster the prosecution's case against the person being questioned.
In relation to the need to question: currently, before issuing a summons an examiner must be satisfied that this is reasonable in all the circumstances. Similarly, the Integrity Commissioner must have reasonable grounds to suspect that any evidence given will be relevant to an investigation into a corruption issue. The bill will introduce additional criteria which an examiner and the Integrity Commissioner must consider before summoning a person to attend a post-charge examination or hearing. In particular, the bill will require the ACC examiner to be satisfied that issuing the summons is reasonably necessary for the purpose of the relevant special operation or special investigation, even though the examinee has been charged with an offence. The Integrity Commissioner must also have reasonable grounds to suspect that the evidence, documents or things produced under the summons are necessary for the purpose of the investigation, even though the witness has been charged with an offence.
In relation to disclosure requirements, examinations must be held in private. Hearings are generally held in private. Examiners and the Integrity Commissioner have the power to issue directions to ensure the confidentiality of examination and hearing material. Breaching a direction is a criminal offence. The ACC and the Integrity Commissioner start from the position that a direction should limit disclosure to as few persons as possible. In any case, a direction cannot be disclosed or used if that would prejudice a person's safety or the person's fair trial. The bill will make these requirements clearer. It will also introduce new restrictions on the ability of the ACC, the Integrity Commissioner, and investigators to disclose examination in hearing material to the prosecution. An investigator will need a court order before he or she can disclose post-charge examination or hearing material, or material derived from that material, to the prosecution. The bill does not give new powers to disclose examination or hearing material to investigators or to the prosecution. An agency must already have the ability to do so under existing legislation.
In relation to safeguards, I also want to go to the powers of the court. The bill specifically preserves the powers of courts to make any order necessary to ensure the fair trial of the person questioned; which order is necessary will depend on the circumstances of the case. It could include excluding evidence, ordering a new prosecution team or permanently staying the trial, in the most extreme of cases. Further, the bill retains the existing rules that make examination and hearing material inadmissible in most criminal proceedings against the person questioned.
I also want to address the issue of whether there will be a review of the ACC's power under the ACC Act. Senator Wright raised the question of a review. The ACC Act is currently the subject of an independent review. On 15 May 2015, the government appointed Mr Philip Moss, the former Integrity Commissioner, to review the ACC Act. Under section 61A of the ACC Act, this review must occur every five years. Mr Moss is due to report by 31 October 2015. Amongst other things, Mr Moss will consider the ACC's powers and whether they are appropriate and adapted to the ACC's role in combating serious and organised crime. Mr Moss will consult all relevant stakeholders, including Commonwealth, state and territory ministers on the Inter-Governmental Committee of the Australian Crime Commission; the Parliamentary Joint Committee on Law Enforcement; and ACC board members. In the meantime, these amendments are necessary to ensure that the Australian Crime Commission and the Integrity Commissioner continue to have access to necessary and appropriate questioning powers, which allow them to play a vital part in the fight against serious and organised crime, foreign fighters and law enforcement corruption.
Can I conclude by saying that this bill confirms the powers of the Crime Commission and Integrity Commissioner. It does not expand them. While these are significant powers, they are necessary to counter the growing threat of organised crime and law enforcement corruption. The individuals and groups involved in these activities are sophisticated and adaptive, and are expanding their operations into new markets. Traditional policing methods are an important part of disrupting and dismantling organised crime syndicates. They are also important in catching the corrupt law enforcement officers who enable organised crime to gain a foothold. However, these methods are not enough on their own. To catch the cartel kingpins and to root out corruption, our police must be supported by information obtained under the questioning powers of the Crime Commission and the Integrity Commissioner. This bill will make those powers clearer. It will put the Crime Commission and Integrity Commissioner's collaboration with their partners on a stronger footing, and it will do so in a way that strengthens the mechanisms that protect the fundamental principles of our criminal justice system relating to the right to a fair trial.
The Senate Legal and Constitutional Affairs Legislation Committee has considered the bill and has recommended it be passed. I thank the committee for its work. The Parliamentary Joint Committee on Human Rights and the Senate Standing Committee for the Scrutiny of Bills have also reported on the bill. I would like to thank all of these committees for their consideration of and comments on the bill. I would like to assure the Senate that—consistent with these reports—the bill contains appropriate powers balanced by appropriate safeguards. The amendments made by this bill are important in ensuring that law enforcement agencies can obtain timely and relevant information, and that they can act on it to protect the Australian community. I commend the bill to the Senate.
Question agreed to.
Bill read a second time.
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.
I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Labor will support the Copyright Amendment (Online Infringement) Bill 2015 after closely considering it in the Senate Legal and Constitutional Affairs Committee. The bill makes a modest contribution to the suite of measures required to deal with Australia's online copyright piracy problem.
The bill implements a site-blocking process under which rights holders can seek a Federal Court injunction requiring ISPs to block overseas websites that have the primary purpose of infringing copyright or facilitating the infringement of copyright. As this test indicates, the bill is directed—as my colleague the shadow Attorney-General said in the other place—at the worst of the worst. It is intended to give rights holders a remedy against a category of websites which deliberately and flagrantly flout copyright laws and operate as havens for pirate activity. A blocking mechanism is necessary because these websites are hosted overseas; were they hosted within Australia, they would be able to be dealt with by the ordinary remedies of the copyright law.
In deciding whether to make an order under this bill, the court will take account of a range of factors including: the flagrancy of the infringement, or the facilitation of infringement, by a site; whether the site shows a disregard for copyright generally; and whether the website contains a directory or index of ways to infringe copyright. On the other hand, the court will consider whether other remedies under the copyright law are available. Importantly, the court will consider the impact of a site-blocking order on any other persons or class of persons and whether making such an order would be a proportionate response in the circumstances. As I said, Labor considered this bill closely in the Legal and Constitutional Affairs Committee. While Labor supports measures which will discourage or disrupt piracy, the power to block websites is clearly to be exercised with great caution, and we wanted to ensure that the power this bill creates is appropriately confined.
The committee endorsed the bill in its report tabled 11 June, but—and I stress 'but'—it did make several recommendations which the government has accepted. The committee noted the strong concern from some rights holders that the primary purpose test was too narrow but recommended that it be retained. The committee did recommend, however, that the government clarify that the test was not to be construed in a perversely narrow way, which the government has done in the explanatory memorandum to the bill. It is obviously not parliament's intention that a piracy website be able to argue, for example, that their primary purpose is to make money and, therefore, they are not caught by this bill; that, indeed, would be perverse.
The committee also recommended the retention of the current provision on legal costs, which exempts ISPs from costs orders if they do not enter an appearance. Again, there had been considerable argument that this provision should be removed. However, Labor and government senators took the view that ISPs should have this protection. The burden of site-blocking necessarily falls on ISPs, even though they cannot reasonably be held responsible for the pirate activity of foreign websites accessed through their services.
The committee also asked the government to clarify its intention as to how the broader question of compliance costs would be settled between rights holders and ISPs. When the government proposed this legislation in its discussion paper on online piracy released in July last year, it indicated that:
Rights holders would be required to meet any reasonable costs associated with an ISP giving effect to an order and to indemnify the ISP against any damages claimed by a third party.
The bill before the parliament, however, is silent on this point, and I look forward to the government's explanation on this issue.
Finally, the committee considered the application of the bill to virtual private networks or VPNs. The prospect that VPNs—which have a range of legitimate applications, not least in personal privacy and security—could be blocked under this bill has caused some concern in the community. The committee wanted to ensure that this prospect was clearly ruled out, and the government has agreed to do so, in the explanatory memorandum to the bill.
As I have said, this bill will make a contribution to the work of reducing copyright piracy in Australia, but it is not a panacea. It is a fairly modest addition to the suite of remedies available under the copyright law. However, the Greens party has sought, for political purposes, to whip up great fear and anxiety about the bill. The bill creates a judicial remedy to deal with conduct which flouts Australian law, but the Greens party calls it an internet filter. The bill is, by virtue of the strict primary purpose test, closely confined. But the Greens party claims that this bill, which is of course a matter only of civil law, will criminalise all manner of websites and platforms.
Labor is satisfied that this bill is not over broad. We do not expect its operation to be controversial. But, as I said, it is not a panacea, and it is clear that this bill, and other measures which seek to deter copyright infringement, can only ever be part of the answer. We must encourage the adoption of legitimate online services and the consumption of legitimate content. No legislative measure will deal with piracy more effectively than the provision to the Australian market of a broad range of content in a timely and affordable manner. This is, at the end of the day, a matter for business and not for government to address. Business practices must work with, not against, modern technology. There has been significant progress in this direction in recent years, and I hope there is more to come.
What government can do, though, is to make sure that our copyright laws are updated for the digital era. Though it is fair to legislate to deal with piracy, we should also look after the interests of consumers, schools, libraries, and digital business. While the government has now pursued several antipiracy measures, they have made no progress on broader copyright reform, even though the Attorney-General promised nothing less than a complete rewrite of the act, shortly after he took office.
The Attorney-General received the Australian Law Reform Commission's report on copyright in the digital economy in November 2013, and yet, incredibly, the government is yet to respond to its recommendations, let alone act on any of them. This is not good enough. Copyright law is too important for us to let it fall into obsolescence. For this reason, I, like my colleague in the House of Representatives, will be moving a second reading amendment calling on the government to respond to the commission's report. This second reading amendment has recently been circulated in its revised form. I move:
At the end of the motion, add:
but the Senate:
(a) notes that the Government has not responded to the House of Representatives Standing Committee on Infrastructure and Communications report on its inquiry into IT Pricing; and
(b) calls on the Government to respond to all of the recommendations made by the Australian Law Reform Commission in its report 122 on copyright in the digital economy by 17 September 2015.
It is with no pleasure that I rise today to address the Copyright Amendment (Online Infringement) Bill 2015, hot on the heels of a Labor opposition that appear to be doing nothing more than going through the motions and are no longer even really deserving of the name. This is a bill that is at once lazy and dangerous. I will go into my reasons for believing those things. It is lazy because, as Senator Collins has quite rightly pointed out, since November 2013 the Australian government has had in its hands the Australian Law Reform Commission's report from quite a broad ranging inquiry into how to update our antiquated copyright regime for the 21st century. Not only has it done nothing to address those quite sensible and far-reaching recommendations, it has cherry picked an element that was not even canvassed in the report and brought that forward because it gives it the impression of having done something and it directly answers to its cashed-up donors and lobbyists, which, we are well aware, is how this government works. So it is lazy from a policy point of view and it is also lazy politics.
It is dangerous because it does create the architecture of a second internet filter in this country. Senator Collins referred to it a couple times as modest. Perhaps it is a modest little filter, but from little things big things grow. This is not the kind of growth that we would be supporting. In a moment I will go into a bit of detail about the current state of play with site-blocking regimes in this country. But, just for some context, on 17 June the Electronic Frontier Foundation, in the United States, which is a leading advocacy organisation for digital rights in the US, pointed out—and this is in the submission to this bill that the EFF put up—the following:
As a bill purportedly meant to address copyright infringement, it is inevitably ineffective and offers little benefit. However its detriment is very clear, in that it further legitimizes the practice of website blocking. This will make it more difficult for Australia to take a stand against these practices when practised by authoritarian countries, and to resist pressure from domestic special interest groups to block more and more categories of content that they may find offensive or undesirable.
Does anybody here in this debate, whatever side of it you may be on—whether it is the stale bipartisan consensus down at the other end of the table or if it is up at this end—seriously believe that this scheme will not be expanded in the future to cover more categories of content? Of course it will. It has scope creep absolutely built into it. It is lazy and it is dangerous.
Those who follow technology policy in this country might recall a forum that was held by the member for Wentworth, Mr Turnbull, in August 2010. At that time the coalition, after the Greens and others had been campaigning for nearly 3 years, had finally got on board with blocking Senator Stephen Conroy's much maligned internet filter. They had finally been persuaded by the strength and breadth of the campaign against the internet filter that they were going to oppose it. Of course, that then lets their opposition spokespeople off the leash to be able to say that of course they thought that way all along. I was not at this forum, but it was quite well written up. At the Paddington RSL in August 2010 then opposition spokesperson Turnbull, in quite a jovial mood, said of the Labor Party's filer scheme:
It's dead, buried and cremated, and if it shows any signs of revival it will then be exorcised
He said that filtering is an idea that should have been 'put-down long ago' because:
It was simply not workable. It was a really bad idea that could only have come from people that didn't actually understand the internet.
That, I guess, is the kind of hypocrisy that tends to infect a debate such as this. From opposition, you can be against it, once you have finally been persuaded by the strength of actual opposition in the community and amongst advocacy groups. But, from government, here it comes.
There was also the rather extraordinary debacle of an announcement in 2013 of this government's filter. I think that lasted about four hours before it was knocked over. Mr Fletcher was involved and there was some potential involvement of Mr Abbott. It appeared that Minister Turnbull was either blindsided, or simply had not read the briefing materials that were put to him, when the opposition actually launched an internet filter proposal right before the election. Within about four hours it was dead. They had backflipped and it was gone. It is the kind of thing that nobody in their right mind announces in the run-up to an election campaign, but the government, knowing that the opposition is basically AWOL, feels reasonably confident that it can introduce a measure such as this.
As I said at the outset, the government is setting in place not one but two filtering schemes and both—in very different ways, actually—are very interesting case studies of how not to regulate the internet. In the ashes of Senator Conroy's mandatory internet filter, where sites would be blocked against a rather poorly defined blacklist of websites, Senator Conroy came up with another rather remarkable and expansive interpretation of section 313 of the Telecommunications Act. Basically, the interpretation was broadened to imply, quite directly, that the government agency under that section of the act could fax—and apparently they do still use faxes, so who knew?—a telecommunications company ordering them to block from viewing within Australia a site that they believe has content that is breaching the law. A House of Representatives inquiry set up by Minister Turnbull to look into that scheme recently rubber-stamped the practice and said that at some point somebody should get around to coming up with some guidelines. In the meantime, that House of Reps inquiry thought that it was fine that an unregulated internet filter, that an unknown number of government agencies, could simply fax service providers and tell them to wipe out sites for a variety of different reasons. So at least the regime that we are dealing with today provides for court orders—we will get to them in a moment.
The law of unintended consequences already hit the section 313 filtering set-up pretty hard. ASIC already used it to accidentally wipe out about a quarter of a million named sites—not all of them active; in fact, as I understand it, the majority of them were simply parked. But just through a simple misunderstanding of how the technology works, a quarter of a million sites were wiped out. Because the system is basically unregulated, there is no right of reply. There is nobody that you can call. The operators of one of the sites in question wiped out by ASIC's enormous overblocking attempt ended up having to come to parliament to find out where their website had gone and why it could not be served within Australia anymore. From the way that this bill is written, it is clear that the government simply does not understand the technology or perhaps, more likely, just does not care.
The second filter that we are legislating today that the Greens will be opposing is not going to be used by the government to block whatever website it wants—and that is a very, very important difference. It will, instead, be used by copyright holders and rights holders to block whatever website they want. Let's go through a few of its failings more directly. During the inquiry into the bill, major companies, including Amcom, iiNet and Google—and even some of the bill's supporters—emphasised that blocking websites will not stop people from accessing content. Amcom and iiNet both put in their submissions that site blocking is unlikely to be an effective way of dealing with online copyright infringement. Google said:
There is increasing evidence to suggest that site-blocking is not the most effective means of stopping piracy.
They did not leave it there, obviously, because there are a lot of good ideas on the table about how to stop piracy. If people are determined to pirate content, it is very difficult to stop them. There are dozens of ways of getting around a website being blocked, ranging from using a virtual private network—or a VPN—to using one of many streaming apps or websites, or just getting hold of the files on a USB stick and running them from there. Choice noted in its bill inquiry submission that circumventing a website block is not very difficult.
The only effective way to deal with copyright infringement on the kind of scale that the government is concerned about is to just make it available: conveniently, affordably and in a timely way. The distribution model—where you could sit on your 20th century distribution bottleneck, put a property up on screen and then wait for two months and do the TV release, and then wait another two month and release it on DVD—is broken. That model worked before the internet existed. Rather than coming up to speed with that fact and offering content in a timely, convenient and cost-effective way, the rights holders—who have collectively donated around $4 million to those parties who are today championing their cause—have called on the government to legislate. They finally found a pushover of an Attorney-General and an opposition too weak to be bothered to turn up to the fight.
We know this, because the House inquiry into IT prices in Australia identified ways of wiping out copyright infringement as being quite simple: just make the content available and then people will use the appropriate channels. The House inquiry into IT prices looked into the so-called Australia tax where content providers, software developers and others treat Australia as an island market where they can charge much higher prices and release stuff much later. When that falls down and people then take the step of infringing copyright, these very same interest groups, having written out their cheques to the Labor Party and the Liberal Party, come in expecting legislation for their benefit.
That inquiry recommended, for example, that consumers have a right to use evasion techniques to access geoblocked content from being accessed in Australia. I do not actually think this is an issue that is going to be particularly controversial. Minister Turnbull has been pretty upfront. He says avoiding geoblocking techniques should not be illegal. The IT prices inquiry certainly found that it should not be, so I propose to test goodwill on that proposition by moving an amendment when we get to the committee stage.
Of course the government has not responded to that report either. So what we see again is that element of laziness: bring forward a site-blocking mechanism but don't deal with the broader more nuanced elements of the way copyright policy needs to change to stay up to date with what technology is doing.
If you want evidence that people are willing to pay for content and will not pirate it, if it is available, look at the launch of Netflix in Australia not that long ago, which has seen an extraordinary take-up in service. One month after its launch this March, Netflix reportedly now accounts for a quarter of iiNet's traffic. They are struggling to keep up. They are hardening up and improving their infrastructure. A quarter of iiNet's' traffic, according to one report that I saw, is people using Netflix: people paying for content; people who were not able to access the material through other channels are now stampeding through iiNet—and I am presuming Telstra and others are seeing the same in their traffic.
So it is lazy legislating. If you want people to stop ripping stuff off—and I am an artist; I come from an arts background and I want artists to get paid, particularly Australian ones—make it available. Stop trying pretend that it is still the 20th century and that the internet does not exist.
If experience has taught us anything, we get this ineffective site-blocking regime, which I think has quite dangerous seeds within it for expansion and scope creep. On the other hand, with the mechanism that now exists, every filter that has been tried or trialled has had unintended consequences and overblocking.
Labor's first internet filtering scheme quite notoriously listed the website of a Queensland dentist and a tuckshop consultant on its black list. ASIC, as I said before, inadvertently knocked over 250,000 sites. The parliament's own internet filtering scheme—I suspect there is not a senator or staffer in this building who has not seen the parliament's blocked list message for some piece of content that might have a word taken out of context . It blocked a News Limited former website, The Punch—I am not even sure why; I have had similar experiences with other completely harmless sites. These things are actually very difficult to keep accurate, given the volume of content that is out there.
The Australian Christian Lobby already called for the filter to be extended to cover completely legal pornography sites. I know not that many people take them all that seriously—although some in the coalition probably still do—so, arguably, they might be seen as a voice from the fringe and one not to pay too much regard to, but they do have very senior access to Liberal Party spokespeople and ministers. And they called it a no-brainer—a mandatory clean-feed. If you wanted to see categories of content that the Australian Christian Lobby does not like, you would have to put yourself on an opt-in list; you would have to be listed as wanting to see things that the Australian Christian Lobby disapproved of. I understand that they may be seen as voices from the fringe, but that was a serious proposition that they put forward, as they welcomed Mr Turnbull and Senator Brandis's announcement of this—
You'd know about voices from the fringe, wouldn't you.
Speaking of voices from the fringe, Senator Macdonald, I am so looking forward to your contribution. I will hurry along because I know you are very eager.
Both the Minister for Communications and the shadow Attorney-General have stated that the bill is not intended to catch legitimate services like virtual private network providers, but the bill does not make it clear. Again, I am hoping that this is a relatively uncontroversial amendment. VPNs have a very wide variety of legitimate uses, and I think it is extremely concerning that this bill has left vague the fact that it may be possible for a court to decide that the primary purpose of VPN services is to facilitate or to infringe copyright.
The structure of the bill makes it very clear that, at least after the first several actions, it is very unlikely that these blocking injunctions, that will come, most likely, from foreign rights holders, will be blocked either by the affected website owners—who may be based overseas and who are not necessarily going to want the expense of defending an Australian legal case—or the ISPs. So why would the service providers, particularly after the first couple—we can assume some goodwill here but maybe not hope that it would extend too far—be fronting up expensive legal cases in defence of their users? iiNet did that—they took that all the way to the High Court—and iiNet has been quite ferocious in defence of their users' privacy. This bill appears designed to circumvent that kind of goodwill and make it very expensive or very costly in the future.
The experience in the UK, where a similar regime prevails, shows that ISPs are likely to only contest the first few injunctions before waving through most of what comes afterwards. And that—again, to foreshadow—goes to why we have proposed, in another of our committee stage amendments, that much wider standing should apply, so that the courts can hear from affected third parties or others who might want to put a public interest point of view or who have a private interest even though they are not the ISP or somebody more immediately affected.
Say, for example, you use a cloud hosting provider, or you use a particular service for business purposes, and you suddenly find one day that it has been wiped out and you can no longer reach it. You may have nothing to do with breaching copyright, but a court somewhere has decided that it was facilitating copyright infringement. What right do you have to contest that application in court if your private data is no longer available to you or your business in this country? That is the kind of risk that we are playing with here.
So, when it comes to the end of this debate—and I understand very few speakers have been put forward—we will be moving a second reading amendment, and I will foreshadow it now. I will move now, for voting on later in the debate, that this debate should be adjourned. Our amendment is quite similar to an amendment that the Labor Party moved in the House, and it is again a little bit similar to what Senator Collins foreshadowed, except that our amendment would have some practical effect. It is not rhetorical. We propose that this bill debate be adjourned until the government has responded to the ALRC's review of copyright reform of November 2013. Senator Collins name-checked it on the way through, and quite rightly so. That was where this agenda was last canvassed in a reasonably broad and consultative way by people who were not simply the rights holders. There were $4 million in donations to the major parties. That kind of influence is not something that the ALRC was subjected to. So I hope that we will get support that this debate should not proceed and a vote should certainly not proceed until those bigger issues have been looked at.
I think, as I said at the outset, that this bill combines elements of laziness, and it is also dangerous and it is not something that we should be rushing forward. It is a bill that, in my view, appears designed to expand, down the track. So I would call on the Labor Party this afternoon to actually be the opposition and try and hold this government to account, for a change, in defence against not just the unintended consequences but the quite real consequences of passing the bill in its present form.
Senator Ludlam, you have foreshadowed the amendment on page 7709—is that correct?
Yes, that is correct; I am sorry that I did not identify that on the way through.
Isn't the Senate lucky that we have got someone with Senator Ludlam's expertise here to help us with these bills! Nobody else, apart from Senator Ludlam, understands this! Everybody else has got it wrong and only Senator Ludlam is correct! Because this is recorded in Hansard, can I just say to Hansard: this is said with irony, because I certainly don't believe it—but Senator Ludlam clearly does. Everybody else who has spent a lot of time and work on this is, according to Senator Ludlam, lazy. It is only Senator Ludlam who knows and understands these issues!
This is a complex area. I contributed to this bill, the Copyright Amendment (Online Infringement) Bill 2015, as the chairman of the Legal and Constitutional Affairs Legislation Committee, which looked at this bill in some detail. And I recognise the work done by Senator Collins, and it was quite considerable, and my colleague Senator O'Sullivan, which formed the basis of the intense investigation into this bill.
Senator Ludlam got himself put on the committee so that he could contribute his expertise, but, regrettably, when it came to the hearing, Senator Ludlam was nowhere to be seen. So he did not bother to turn up and question witnesses—because he knows it all! He knew what their answers would be! Now he chooses to come in here and accuse everyone else who has spent a lot of time on this of being 'lazy'. But I have confidence, first of all, in my committee, and, clearly, in the Department of Communications and the Attorney-General's Department, who have put a lot of work into this very important area.
Online copyright infringement does pose a significant threat to the viability and success of Australia's creative industries. Infringement currently occurs on a large scale. Therefore, rights holders need effective mechanisms to reduce the incentive for infringing practices. The committee came to that view after investigation, and I want to thank Senator Collins and Senator O'Sullivan, who carried the brunt of this work. I also recognise the secretariat staff who, as always, put an exemplary effort into considering all of these bills, looking at the submissions to make sure every i is dotted and every t is crossed in sentences and assisting the committee in the recommendations that it brings to the parliament.
I take some pride in the fact that this is a committee that does not hesitate to recommend amendments to government legislation or, at times, even to recommend against the bills. This is a committee that treats its work as a committee of parliament very seriously, and this is the case in this particular reference. I alert the Senate to the committee's report, and I recommend the committee's report for anyone who wants to follow this issue. It is a balanced report. It sets out the key issues and the background and then gives the committee's view on the bill and on recommendations that the committee might make. For anyone interested in this subject, have a good read of the report. Although it is a complex area, readers will then know a little bit more about it.
The committee did consider that proposed section 115A(5) of the bill may be too prescriptive in requiring a court to consider all the listed matters in every application for injunctive relief. The committee took the view that the court should be able to exercise discretion in identifying the salient features of each matter on a case-by-case basis, so the committee made the recommendation that the bill should be amended to provide for that. I am delighted to say that, in the other chamber, the government did accept the recommendation and amended the bill, and it passed with that amendment. I am delighted that the government has looked at that.
As a committee, we acknowledge the evidence given by the Department of Communications regarding VPNs. But the committee noted that the bill does not explicitly contemplate the introduction of injunctions against VPNs. The committee also notes that VPNs are unlikely to meet the primary purpose test that is proposed in proposed sections 115A(1)(a) to (c). However, the committee would be reassured if the government were to clarify the status of the VPNs in the explanatory memorandum, and I understand that the government has done that.
The committee also recommended that the explanatory memorandum be amended to specify that 'reasonable steps to disable access to an online location' may include a requirement to post a landing page at the blocked online location specifying the relevant online location has been blocked by order of a court and outlining details of the order. That came about as a result of submissions made to the committee by those in the industry who pointed out that that was an important part of the process.
The committee also noted that the bill was preceded by a regulatory impact statement but no formal cost-benefit analysis and, as such, the committee received no information that provided a comparison between the expected benefits to rights holders and the potential cost to other parties. Although this did not affect the committee's ability to determine the merits of the proposed legislation, it does lead the committee to give consideration to the recommendation of the Internet Society of Australia. They said in their submission that the government should review the effectiveness of the bill one year after its enactment and that the review should include the number of sites and locations blocked, the number of sites and locations that continue to provide access to the alleged infringing material, the cost to CSPs of implementing requirements of the bill and the practical effectiveness and ease of bypass of the methods used to implement blocking.
Some of the matters raised by our expert senator—Senator Ludlam—in his address previously could be looked at and some actual data obtained. The committee recommended that government conduct a formal review of the effectiveness of the act, to be completed two years after its enactment. That is a recommendation that I do think makes some sense. It was mentioned by some of the submitters, and the committee accepts that view.
There was a lot of evidence on the costs to various parties. The committee took the view that the question of costs should be a matter for the court to determine on a case-by-case basis. The committee notes that, in the absence of malice, a nonparty to proceedings would not normally be liable for costs. As such, the committee questioned the utility of the proposed section 115A(9), which, in the opinion of the committee, serves only to confuse the issue of costs. There was evidence from the Communications Alliance—I think it was—on this aspect. It was something that the committee looked at quite closely. We did note the persuasive evidence of service providers to the effect that a CSP bears no fault or liability for the infringement of copyright by its subscribers and, because of that, the CSP should not be required to contribute to the cost of the remedy. The committee was of the view that more clarity is required to reassure CSPs that the costs associated with site blocking will primarily be borne by those parties who are actually seeking the remedy.
Finally, in noting that compelling evidence regarding the need to indemnify a CSP for acts done or admitted to be done in compliance with court orders, the committee had some regard to the reasoning of Justice Perram in the Dallas Buyers Club v iiNet case, but urges the government to provide greater clarity on the issue of the CSP indemnity from consequential actions. Accordingly, the committee recommended that the explanatory memorandum be amended to provide greater clarity and guidance on the issue of service provider cost and liability subsequent to the service provider's compliance with court orders made under the proposed amendment to section 115A. I understand the government has done that and, with those qualifications, the committee recommended that the bill be passed—even if, according to Senator Ludlam, it is completely useless and of no benefit. Those who attended the hearing, those witnesses who gave evidence, the two departments and many other people are, dare I say, as versed and as knowledgeable as Senator Ludlam—although from what I hear Senator Ludlam say, that would not apply to anyone in the world. But I go on the side of the vast majority of experts, who agree with the committee that the bill should be passed.
In concluding, can I thank all of those who took the time to make a submission to the committee to make sure their views were considered before the matter came to parliament. I thank those committee members who actually turned up—which, I repeat, does not include Senator Ludlam, who knew so much that he did not need to bother attending the committee. And can I again thank the secretariat staff who, as usual, produced an excellent paper on the subject that encapsulates the committee's views. I urge that the bill be passed.
I rise to oppose passage of the Copyright Amendment (Online Infringement) Bill 2015. I do so because the bill is vaguely drafted and unlikely to achieve its aims. In addition, it aims to protect rights holders at everyone else's expense, which is not how the rule of law is supposed to work. The bill seeks to amend the Copyright Act 1968 to enable rights holders to obtain an injunction to block foreign-based online locations whose primary purpose is to infringe or facilitate the infringement of copyright. Website blocking is a drastic remedy and a blunt tool. The bill has the potential to be used against a range of legitimate sites and has inadequate protections for non-party interests. Meanwhile, placing increased emphasis on enforcement without addressing the other overdue reforms of the Copyright Act risks a ridiculously unbalanced copyright regime.
Australia already lacks a general fair-use defence to claims of breach of copyright. This is why, to take one recent and very silly example, NSW Premier, Mike Baird, was forced to take down his amusing 'mean tweets' video before the last state election—not because some of the tweets contained filthy language, but because of some of the music he used in the background to his video. There is a desperate need for reform of this area of the law, but it has been left untouched. Instead we have been presented with a piece of legislation that fails in several respects. First, it has inadequate protections for freedom of speech and freedom of access to information, which could result in access to legitimate content being blocked. Affected parties such as consumers and institutions are unable to seek revocation or review of injunctive orders. There is no extension of safe harbours, which would provide rights holders with a simple way to take down infringing material, or for ISPs to distinguish themselves from a copyright infringer using their services. There is no oversight nor any indemnities to track and protect against overblocking or other technical issues. There is a serious possibility that online tools and dual purpose sites such as VPNs, cloud storage, URL shorteners and compression tools may be blocked. As people in this place know, we—parliamentarians, our staffers and parliamentary employees—all use a version of a VPN in order to log into the Australian Parliament House website remotely. Whenever we log into the APH network with our remote access tokens, our location is always seen as Canberra. This alone suggests that little thought has gone into the drafting of this bill. It is a bad idea to draft in haste and repent at leisure.
I will support the Greens' amendments to this bill and, if they pass, I will reconsider my opposition to the bill. However, that none is expected to pass reflects poorly on Labor and the coalition and their once proud tradition of support for innovation and technological progress in this country. Once again, this is very bad law.
Can I thank those who have spoken in relation to the Copyright Amendment (Online Infringement) Bill 2015. Australian art, music, literature, film and television are a treasured part of the Australian way of life. A world without creative works would be a world with much less colour. The creative industries are also a major driver of economic growth. According to a 2015 report, Australia's creative industries employ over one million people and generate economic value of more than $111 billion, including $4.8 billion in exports. It is therefore essential that we provide incentives and rewards for creators and appropriate protections for the fruits of their labours. These incentives, rewards and protections can only be provided through a robust copyright framework.
Online copyright infringement is highly prevalent in Australia. There is a range of reasons why Australians choose to infringe copyright. It is a complex problem. There is no single cause and no single solution, but a key part of the equation is the constant, ubiquitous supply of infringement content. In this digital age all forms of information can be disseminated freely and easily to a far greater extent than ever before. With the good comes the bad: content into which artists have invested years of effort, and their life savings, can be shared in seconds, at no cost, without their permission.
Supply of infringing copyright material is delivered efficiently, relentlessly and on a large scale to the homes of Australian consumers. Foreign based online locations are often responsible for these operations. The operations of these online locations not only derive enormous profits from their infringing activities but often use these profits to fund other serious criminal activities. If unchecked these infringing online locations will drive legitimate distributors and creators out of the Australian market in spite of their best efforts to change their business models to suit the desires of Australian consumers.
The price and availability of content in Australia has also been cited many times as the key cause of online copyright infringement. It is certainly an important contributing factor. Australian consumers do not want to pay more for their content or wait months longer to watch it than consumers overseas. However, copyright owners have come to realise this and they are taken steps to address it. For example, they have acknowledged that it has been a mistake to delay the release of content in Australia. They have made significant efforts to improve the availability of affordable and timely content for Australians. The recent launch of movie streaming services such as Netflix, the early release of films in Australia and the lowering of entry-level prices on pay-TV packages have been notable steps in the right direction.
Consumer behaviour forms the final part of the equation. The internet has brought unprecedented freedom to access information, a freedom to which the majority of Australians are now accustomed. Australians no longer discriminate between information that is available legitimately and content that they do not have permission to access without paying the price that the content owner is entitled to ask for. Australians love creative content. They value it and they want to enjoy it, not destroy it. They need to be reminded that, if they take too much without giving back, they will jeopardise the production of the content that they love. It is, therefore, important that the bill is complemented with other measures that educate users about respect for copyright. One important initiative is the industry code that has been developed by internet service providers and rights holders. It is intended to provide a mechanism to warn Australian consumers of the consequences of copyright infringement and inform them of legitimate sources of content. It is currently being considered by the Australian Communications and Media Authority, and I am hopeful it will soon be registered and in operation.
At present, copyright owners have no effective means of combating the wholesale infringement of their rights. Direct infringement proceedings against foreign based online locations are fraught with difficulty. These are the challenges of enforcement. The territorial nature of copyright means that copyright owners often face complex issues of private international law when enforcing their rights in the online environment. The legal complexities and the possibility that copyright owners will need to attend foreign courts to enforce their rights means that any direct proceedings against a foreign online location are likely to be prohibitively costly, particularly for lesser known copyright owners. It is also not practical to bring proceedings against individual infringers where infringement occurs on a large scale.
This bill provides copyright owners with an efficient mechanism to disrupt the supply of infringing content to Australian consumers. This bill will provide an enhanced streamlined mechanism that enables infringing material to be blocked by a carriage service provider without the need to establish fault on the part of that provider. Specifically, the bill will introduce a new provision that allows rights holders to apply to the Federal Court for an order directing a carriage service provider to enable access to infringing online locations located outside Australia. There are a number of safeguards to ensure that the power does not unduly encroach on other important public and private interests. First, the provision will only capture online locations where it can be established that the primary purpose of the location is to infringe copyright or facilitate the infringement of copyright. Second, the court may consider a broad range of factors that reflect competing public and private interests. These factors include, for example, the flagrancy of the infringement or its facilitation; whether blocking access to the online location is a proportionate response in the circumstances; and the overall public interest.
The Senate Legal and Constitutional Affairs Legislation Committee recommended that the bill be passed subject to four other recommendations. The government would like to thank the committee for its work, and all those who put in submissions. The government has accepted all of the committee's recommendations, which have been addressed by the amendment made to the bill in the House of Representatives and through the explanatory memorandum that accompanies the bill before the Senate. In response to the committee's recommendation the bill now gives the Federal Court discretion to take into account specified matters in deciding whether to grant an injunction rather than being required to take these matters into account and what weight to place on those factors. This is consistent with the approach normally taken by a court in assessing whether to grant an injunction.
The government has also included more guidance in the explanatory memorandum as a result of the committee's recommendations. We have clarified that the appropriate orders which the Federal Court may make in granting an injunction could include a requirement that parties set up a 'landing page', where subscribers will be diverted if they try to access a disabled online location. We have also clarified that, consistent with case law, carriage service providers should not be exposed to legal actions by subscribers as a result of acts or omissions in compliance with an order and that the court has discretion to make appropriate directions on the cost of implementing an order. The explanatory memorandum also provides additional detail on the operation of the primary purpose test. Specifically, an online location could have the primary purpose of copyright infringement even if it operates in such a way that it derives profits from advertising revenue. Finally, the explanatory memorandum addresses the application of the provision to virtual private networks (VPNs). This is a concern that was raised during the committee process. On this point, the government wishes to stress that the bill is not intended to capture VPNs which are promoted for legitimate purposes or which are merely used to access legitimate copyright material distributed in a foreign geographic market. VPNs have a wide range of legitimate purposes. Providers of VPNs have no oversight, influence or control over their customers' activities. The government has also committed to review the operation of the bill 18 months after its commencement.
I would like to briefly comment on the status of other copyright inquiries and reviews. First, the government has been clear that its first key priority is to address online copyright infringement. This has been a growing problem over a number of years, which has not been properly addressed. For example, the previous government attempted, through an Attorney-General's Department round-table process, to develop an industry agreement, but without success. We have now had the opportunity to deal with this issue properly. Second, the government has not lost sight of the need for broader copyright reform. The Attorney is on the record as saying that the act is long overdue for a rewrite; however, the debate surrounding the current bill illustrates just how complex copyright reform can be. While others may rush to easy conclusions, the government is committed to a genuine reform process. In the meantime, the government continues to develop copyright reforms that respond to pressing needs. For example, last week we tabled the Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired or Otherwise Print Disabled and a related National Interest Analysis, and referred it to the Joint Standing Committee on Treaties.
In conclusion, this bill forms an important part of the solution to the longstanding problem of online copyright infringement. It targets the systematic supply of infringing-copyright material on a large scale by foreign based online locations that often derive profits from infringement. This will provide breathing space for the legitimate market, so that innovative distribution models that provide competitively priced and timely content can properly flourish in Australia. The bill provides a proportionate, balanced and effective solution which takes into account other important public and private interests. I conclude by thanking all senators who have contributed to the debate on the bill. I commend the bill to the Senate.
The question is that the amendment on sheet 7729 revised, moved by Senator Collins, be agreed to.
Question agreed to.
I move:
At the end of the motion, add:
but further consideration of this bill be made an order of the day for the first sitting day after the Government has tabled its response to the Australian Law Reform Commission's report 122 on copyright and the digital economy.
The question is that the amendment moved in the name of Senator Ludlam, numbered 7709 and foreshadowed in his speech, be agreed to.
Senator Ludlam, I want to confirm that your amendment on sheet 7731 has been withdrawn. Is that correct? That being the case, the question is that the bill be read a second time.
Original question, as amended, agreed to.
Bill read a second time.
I have one or two very quick questions. I think by now the scope of the bill is more or less broadly understood. Senator Fierravanti-Wells, I recognise that you are here representing a minister and that this might have been handballed to you at the last minute, although I recognise some of the Attorney's advisers in the chamber. I am interested to know who the minister consulted with in the drafting of this bill. When this came up during estimates committee hearings going back all the way to the beginning of last year, it was very evident that the minister had an open door for Village Roadshow, AFACT, which has since changed its name, and big foreign rights holders but had not bothered to meet with Choice, the Australian Digital Alliance, ACCAN or anybody else who might actually represent the rest of us, either from an artist's point of view or from a user's point of view. Are you able to either correct the record or update us as to whether Senator Brandis condescended to meet anybody other than the rights holders?
Thank you, Senator Ludlam. I am advised that carriage service providers were part of an extensive consultation process on an online copyright discussion paper concluding in September 2014 with key stakeholders. The discussion paper included a proposal to introduce an injunction power to block access to foreign based infringing websites. Many CSPs submitted detailed comments on the proposal and, as a result of that process, the provision was drafted to take into account those comments. I would also mention that any court must first find that the primary purpose of the online location is to infringe or to facilitate infringement of copyright and that a court can further consider a number of other relevant factors, including the interests of any person likely to be affected, such as the CSP, in consideration of its deliberations.
I thank the minister for that quite helpful answer. I understand that the minister has met with the rights holders—I do not know if it was the minister directly—and that at least senior members of the A-G's department and others have heard the views of CSPs, so we have the intermediaries taken care of but not the consumers, the end-users or the artists. Presumably, we have the rights holders speaking for the artists—I would contest whether they are actually doing that, in a lot of instances, but we will let that one go through to the keeper—we have the carriage-service providers who are providing the business in a service and, from time to time, some more than others, they stepped up and argued for the public interest. But they are a business. They are trying to protect their industry.
At any time, have the minister or senior members of the A-G's department or anybody you would care to name—I find the word 'consumers' loathsome but I am looking for it—met with ordinary Australians or users or their advocates, such as the organisations I mentioned before? The three that come to mind are: the Australian Digital Alliance, who made extensive submissions on this bill; CHOICE, who are one of the leading consumer-rights advocates in the country; and ACCAN, the peak body that the former government set up and that has been quite active in this space. I understand the intermediaries have certainly had their views well understood. What about the public?
I am advised that there was extensive consultation. I also understand that through the Senate committee process there were extensive submissions, including from groups you have mentioned. That is my understanding.
I am not going to labour the point here. You are quite right, the Senate committee did take quite strong evidence from the groups that I named and from a number of others who strenuously opposed the bill and proposed amendments that the government does not appear to be very interested in, but by the time it gets to the Senate committee the government has already made up its mind. It is certainly out there looking, potentially, at amendments but the model has already been set—that we are going to get a site-blocking regime.
Can I take from your answers that either senior officers of the Attorney-General's Department or the minister himself had not met with any of those rights organisations that I mentioned before?
I am advised that during the online-consideration process over 700 individuals responded. I make the point that we accept consumer groups and individuals have raised concerns about the proposal, in response to the 2014 discussion paper. I am advised that the bill has been drafted to ensure that there are more safeguards and to address some of the concerns that have been raised. For example, the court now has the ability to consider a wide range of factors before granting an injunction; these include whether the order is in the public interest.
I think I have made my point. Unless other senators have any general questions regarding the operations of the bill, I will start moving through the Australian Greens amendments. We are working from sheet 7710. Amendment (1) deals with avoiding geoblocking. In a nutshell, it proposes to amend the Copyright Act to explicitly state that evading geoblocking is not copyright infringement.
Minister, I think you addressed this in your closing comments, just before you closed the second reading debate, which I was glad to hear. Key figures on your side—through you, Temporary Chairman—of politics and also from the Labor side have stated that they believe avoiding geoblocking is legal. That was made pretty black and white in the IT pricing inquiry, but the bill is currently unclear on this and needs to be cleared up and made black and white.
The amendment will make it quite explicit that avoiding geoblocking is not any kind of offence. We can go some way towards educating Australians on how to avoid geoblocking, which was another recommendation of the IT price-hike inquiry. I will give the government the benefit of the doubt on this, and Minister Turnbull has mentioned this a couple of times, that they do not appear to want to criminalise geoblocking. So why would they pass a bill that could conceivably be interpreted as doing that?
I hope this amendment will see favour with one or both sides of politics. I suspect that when government and opposition spokespeople speak to the amendment they will profess to support it, in spirit, but will not vote for it in the letter of the law, and that is a rather poor way of legislating. So I am looking for a reading from the opposition or the government as to whether they (a) support the principle, and (b) would support it going into the act.
Thank you, Senator Ludlam. Sheet 7710 that you referred to, has nine different matters. Are you proceeding with them individually?
Yes.
The TEMPORARY CHAIRMAN: This is just the first matter. Have you moved it?
Yes, I am happy to move it and I am hoping to get a read from somebody else. I move:
(1) Schedule 1, page 3 (before line 4), before item 1, insert:
1A At the end of Part III
Add:
Division 10—Geoblocking avoidance facilities
83A Geoblocking avoidance facilities
In this Division:
geoblocking avoidance facility means a device, product, technology or component (including a computer program) that is used in Australia to control, disguise or block the geographical location of a person or device.For the purposes of this definition, computer program has the same meaning as in section 47AB.
83B Provision, offer or use of geoblocking avoidance facility does not constitute infringement
(1) If a person either:
(a) provides a geoblocking avoidance facility to another person; or
(b) offers a geoblocking avoidance facility to the public;
then, despite any other provision of this Act, the person does not infringe any copyright under this Part merely by providing or offering the geoblocking avoidance facility.
(2) Despite any other provision of this Act, a person does not infringe any copyright under this Part merely by using a geoblocking avoidance facility.
1B After Division 6 of Part IV
Insert:
Division 6A—Geoblocking avoidance facilities
112F Geoblocking avoidance facilities
In this Division:
geoblocking avoidance facility means a device, product, technology or component (including a computer program) that is used in Australia to control, disguise or block the geographical location of a person or device.For the purposes of this definition, computer program has the same meaning as in section 47AB.
112G Provision, offer or use of geoblocking avoidance facility does not constitute infringement
(1) If a person either:
(a) provides a geoblocking avoidance facility to another person; or
(b) offers a geoblocking avoidance facility to the public;
then, despite any other provision of this Act, the person does not infringe any copyright under this Part merely by providing or offering the geoblocking avoidance facility.
(2) Despite any other provision of this Act, a person does not infringe any copyright under this Part merely by using a geoblocking avoidance facility.
The TEMPORARY CHAIRMAN: Senator Collins?
This bill is not, as the Greens keep insisting, concerned with geoblocking. As the communications minister pointed out and as the Attorney-General's Department has previously advised committees of this parliament, general geoblocking practices are not protected as technological protection measures under the Copyright Act. As a consequence, these amendments are not necessary.
I unfortunately missed the call before Senator Ludlam started moving his amendments. I did want to raise some issues in a more general nature. Perhaps I will come back to that later. Suffice to say in passing that the number of people who gave evidence to the committee is shown in the Legal and Constitutional Affairs Legislation Committee's report on this legislation, which I referred to in my second reading speech. At appendix 1 of the committee's report is a list of the public submissions that have been made—49 submissions, and many were called to give evidence. I note that some of the prominent groups that did give evidence or made submissions included the Communications Law Centre, the Australian Copyright Council, the Human Rights Commission, iiNet, the Institute of Public Affairs, the Australian Digital Alliance and Screen Producers Australia. Quite a number of people very closely—
Temporary Chairman, I rise or a point of order. I wondered whether you could draw Senator Macdonald's attention to the question before the chair. It is an amendment on geoblocking.
I believe there is no point of order. Senator Macdonald was talking about the work of the committee in broad terms and I have no doubt he was getting to the issue of geoblocking.
Thank you, Mr Temporary Chairman. I appreciate that. As I indicated, I did want to speak on Senator Ludlam's amendment, but I missed the call, through no-one's fault except my own, I might say. I missed the call earlier, and I did want to raise some issues with the minister about that. I will do that later as time permits. The question of geoblocking, as Senator Collins very carefully and accurately pointed out, is not really relevant to this particular bill before us. We indeed took a lot of evidence from a lot of people. I was referring to some of them when Senator Ludlam interrupted me last time. I was trying to recall which of those who gave evidence actually referred to geoblocking and made the point that Senator Collins has already made. That came out in some of the submissions. I am looking through this list trying to recall, from the 49 submissions that were made, which of those actually made comments on geoblocking. I do note that, of those who made submissions, there were quite a number who did give evidence. The Hansard will record that some of them referred to the general policy issue that Senator Ludlam has raised in his amendment. I thank Senator Collins and Senator O'Sullivan for attending the committee hearings when these issues were raised. A number of people gave evidence before the committee and some of them, from my reading of the Hansard, did relate to this very important issue.
It is a fraction unfortunate, as I mentioned before, that Senator Ludlam, who got himself appointed to this committee so that he could share his expertise with the rest of the committee, was not able, for whatever reason—I am not sure—to attend the Sydney hearings of the committee where these particular issues could have been canvassed. Had Senator Ludlam attended that, the issues he raises in this amendment before the chair could have been fully canvassed at that time with people who are expert in the area. I know that the Attorney, whose bill this is, is a bit of an expert on those matters as well and he obviously has very good staff who are able to advise him. I know that Senator Fierravanti-Wells is, as some might call her, a modern person right up with these technical terms and is very expert in the bill as well. Clearly, it is unfortunate that Senator Brandis cannot be with us just at the moment to answer these questions. I make the point on the amendment that it is not protected; it is not what this bill was about.
I might leave it there and simply reinforce the point that Senator Collins has so well made. I will return at a later stage as the amendment process proceeds to a place where it will allow me to ask the more general questions I should have asked previously. Minister, I support Senator Collins' view on this. No doubt it is for the government to respond more formally, but it is not an issue for debate on this particular bill.
I echo the comments that Senator Collins made. This proposed amendment is not relevant to the bill. This bill is about access to infringement material and effective relief for right holders. It is really a matter for operators of sites to determine how to enforce their own site restrictions—for example, how and whether to prevent persons outside of a particular territory from accessing their contents.
The question is that amendment (1) on sheet 7710 in the name of Senator Ludlam be agreed to.
Question negatived.
I will move to my second amendment, which I addressed in passing on my way through the second reading debate. Amendment (2) on sheet 7710 changes the definition of sites targeted by the bill to specify that the sites must be flagrantly infringing copyright. The intention of the amendment is to apply a higher test—a steeper threshold—by which the courts would assess whether a site was infringing copyright. The word 'flagrancy' has been used elsewhere in the bill; it is used extensively in the explanatory memorandum. But it is not a determination that the court will be making—as to whether a site is or is not flagrantly breaching copyright. The intention here, I hope, is reasonably transparent and clear to senators—that is, we are trying to minimise the risk of, effectively, collateral damage—given how broadly the term 'facilitating' may well be taken to be read in the context of this—to sites which have very little to do with copyright infringement but which may be caught up in this net; particularly once these sorts of court orders become routine. Once rights-holders get good at this and once ISPs have given up defending these actions in court, and once these orders become much more routine—which is, I fear, what may occur—we are going to need to maintain a very high threshold test for whether courts will knock websites over.
Currently, the bill would require courts to consider the flagrancy of the copyright infringement taking place on any specific website proposed to be blocked. However, it would not require the website to be flagrantly infringing copyright for it to be blocked. In other words, we are trying to strengthen the test against the risk of over-blocking by the filter. What our amendment does, specifically, is change the flagrancy requirement from being a consideration—that is, from being one of the things that the court should be required to keep in mind—to being the test that should be required and that should be foremost in the court's consideration. We believe that this is much easier for courts to consider because it sets a very simple threshold bar. If websites are flagrantly infringing copyright, they will meet the test. Even on a plain English reading of that word, it would, I think, give some of those who are opposed to the bill some comfort that it would only be narrowly targeted. If the website is not flagrantly infringing copyright, then it probably should not be knocked off the air by such a court order. That is the clarity of the test that we are trying to apply.
Senator Fierravanti-Wells, your briefing notes no doubt say that that is something that the courts would be required to bear in mind—it would be part of the criteria; it would be one of the things they are considering. We do not think it should be possible for a website that is not flagrantly infringing copyright to be, effectively, knocked off the net by an order of this type. That is why we are bringing this amendment forward.
Thank you, Senator Ludlam. I want to take the opportunity to affirm that the primary purpose test within the bill ensures that the provisions contain a high threshold for a copyright owner to meet, as a safeguard against any potential abuse. I particularly direct you to section 115A, 'Injunctions against carriage service providers providing access to online locations outside Australia' and, in particular, I direct you to subclause (5), which I will come to in a moment.
The explanatory memorandum has provided a number of examples of online locations that are prima facie intended to be excluded from the operation of the new measure. These are: those operated mainly for a legitimate purpose but which may contain a small percentage of infringing content; an art gallery website operated outside Australia that may contain an authorised photograph; websites such as the www.youtube.com or www.blogger.com; and an online location operated overseas which provides legitimate copyright material to individuals within another geographic location but which is not licensed to distribute that copyright material in Australia—for example, the United States iTunes Store.
Can I take the Senate—and take you, Senator Ludlam—to the particular provision that I referred to, on matters to be taken into account by the court. In considering whether to grant the injunction, the court will be required under this bill to take the following matters into account: the flagrancy of the infringement, or the flagrancy of the facilitation of the infringement, as is referred to in paragraph 115A(1)(c), which states, 'the primary purpose of the online location is to infringe, or to facilitate the infringement of, copyright (whether or not in Australia)'. The court will also be required to take into account whether the online location makes available or contains directories, indexes or categories of the means to infringe, or to facilitate an infringement of that copyright. The court can also take into account whether the owner or operator of the online location demonstrates a disregard for copyright generally. The court will also take into account whether access to the online location has been disabled by orders from any court of another country or territory on the ground of or related to copyright infringement; whether disabling access to the online location is a proportionate response in the circumstances; and the impact on any person or class of persons likely to be affected by the grant of the injunction. The court can also consider whether it is in the public interest to disable access to the online location. It can also take into account whether the owner of the copyright complied with subsection (4). Subsection (4) states that—
Progress reported.
by leave—I advise the Senate that Senator Abetz will be absent from question time this week. In his absence, I will take questions on the Prime Minister's portfolio, Senator Payne will represent the employment portfolio and public service matters, and Senator Scullion will represent the Minister for Agriculture.
My question is to the Minister representing the Prime Minister, Senator Brandis. Minister, will the Abbott government's green paper on Federation include a proposal to cease Commonwealth funding for all schools?
Well, Senator Carr, no, it will not. I think what you are referring to is a draft green paper that was reported in the press over the weekend. It was a draft green paper which is an options paper only. It was developed not by this government alone but in consultation with state and territory governments, because we intend to have a mature and measured debate about the future of the Federation. My colleague the Minister for Education, Mr Pyne said this morning:
The Australian Government does not and will not support a means test for public education. Full stop. End of story.
That is the position of the government.
Mr President, I ask a supplementary question. Will the Abbott government's green paper on Federation include a proposal to abandon public education by stopping Commonwealth funding for government schools?
Far from that, Senator, it was your side of politics that cut $1.2 billion of funding from public schools in the PEFO. It was the Abbott government, Senator Carr, that restored that funding. You cut it; we restored it—
Mr President, I raise a point of order on direct relevance to the question asked. The minister is halfway through his response. It is a proposal to abandon public education by stopping federal funding, not a historical lesson.
I remind the minister that he has 34 seconds in which to answer the question.
I can understand why the Labor Party does not want to be reminded of the history. Perhaps the Labor Party have heard a little bit too much about history on the ABC on the last two Tuesday nights; we all wait with bated breath for the climax of this particular drama tomorrow night. Notwithstanding that, Senator Moore, it does not lie in the mouth of those who surreptitiously cut $1.2 billion from public education—
Pause the clock.
Mr President, I raise a point of order. I know that the minister sat down, but the point of order was as to direct relevance; you drew his attention to the question; he went on and made no effort to come to the question.
I will allow the clock to go back to five seconds to when the point of order was first raised. Minister, you have five seconds in which to answer the question. You have concluded your response.
Mr President, I ask a further supplementary question. I ask how are the proposals, as outlined in the government's option paper, for the Commonwealth to abandon schools funding, consistent with the Prime Minister's election promise that he would make no cuts to education?
Australian education has had no greater friend than the Prime Minister and no greater friend, I might say, than the Minister—
The fixer!
The fixer. Senator Conroy, you are trying to distract me, as you always do. You are very naughty, Senator Conroy. It has no greater friend than the Minister for Education, the member for Sturt, Mr Christopher Pyne. But the fact is, Senator Carr, that unlike that unlamented government in which you served with such conspicuous lack of distinction, we actually believe in future planning. We actually believe in future planning, and if you are going to—
Mr President, I raise a point of order again on direct relevance. If the minister could just come somewhere close to the actual question asked by Senator Carr it would be useful.
I will remind the minister of the question. You have 14 seconds in which to answer the question, Minister.
Senator, an options paper is just that. A draft options paper considers options; that is what green papers are for—the sort of future thinking for which you could never be accused.
My question is to the Minister for Human Services, Senator Payne, representing the Minister for Employment. Can the minister inform the Senate why it is necessary to have a tough cop on the beat in the building and construction industry, particularly in my home state of Queensland? Is there any evidence that the current system needs reform?
I thank Senator O'Sullivan for this very important question, because the CFMEU has clearly shown its willingness to use both aggression and violence to deliberately flout the law and to impede valuable projects, at very significant costs to the taxpayer and the community alike. Senator O'Sullivan asks about his home state of Queensland
I can inform him that some of the worst behaviour of the CFMEU has recently been laid very bare in the Federal Court in Brisbane. In this particular case, the CFMEU was responsible for shutting down work on a Queensland government housing project. That is a housing project that was intended to provide housing for the long-term homeless. Those goals, of course, were of no concern to the leadership of the CFMEU. They blocked access to the site and they abused used workers who tried to enter the site. The court heard, and these are all in court records, how workers were repeatedly called scabs, parasites and dogs—plus a smattering of expletives, which were reported in the media but I will not repeat here. In fact, one particularly charming CFMEU official, a Mr Paul Cradden, approached one of the site workers and flooded him with aggressive attacks of the likes of, 'Hey scabby, gay boy gay boy gay boy scabby,' apparently not aware that it is 2015—he still thinks he is in the dark ages. Is this the kind of behaviour that the Labor Party or the Greens, who seem to support the union and will accept donations from the union, condone? The Federal Court certainly does not. It fined the CFMEU and a string of its officials a total of $545,000 for their offences. Justice Logan called out this outrageous disregard for the law, and reiterated the comments of other judges and the Cole Royal Commission when condemning their very perverse attitude to the law. In light of this, it is absolutely outrageous to see the CMFEU feigning outrage over this government's attempts to re-establish the ABCC. (Time expired)
Mr President, I ask a supplementary question. Can the minister inform the Senate of any other recent decisions that show the need for further work to be done to prevent unlawfulness and contempt for the rule of law in the construction industry?
There is further work to be done. The contemptible behaviour of the CFMEU in Queensland is most unfortunate and is not an isolated incident. This is the union that is also currently before the Heydon Royal Commission. It is facing allegations that it took weekly kickbacks from underworld figures while repeatedly exposing its own members to an employer that evaded payment of employer entitlements. The CFMEU has just had to agree to pay $3.5 million of its members' fees to construction company Grocon for illegally blocking other major projects—$3.5 million, which is one of the largest payouts that has ever had to be made by a union. Perhaps the CFMEU leadership thinks $3.5 million is the cost of doing business, but certainly their membership deserve much better. They are rightly raising concerns about why they should have to pay so much to fund the illegal activities of their union bosses. In fact, on Melbourne radio this morning John Setka was asked whether he would change his approach. He said, 'I don't think we went too far.' (Time expired)
Mr President, I ask a further supplementary question. Thank you, Minister, for your fine answers. Can the minister inform the Senate about what the government is doing to ensure safer and fairer workplaces, and are there any threats to this?
This government takes very seriously the now dozens of court findings against the CFMEU, its reputation for extraordinary unlawful conduct and the millions and millions of dollars of members' money being used to fund its activities. That is why we want to introduce a stronger regime for regulating the unions and a body that can resist this appalling conduct. That is our rationale for reintroducing and re-establishing the Australian Building and Construction Commission. It needs to be a tough cop on the beat that can clean up the construction industry to protect union members and the broader community.
You just want to attack workers. That is all you want to do.
If you think it is about attacking workers, then does that mean you condone the behaviour of this organisation? Does that mean you support the behaviour of this organisation—their appalling outbursts and their disgraceful name-calling of workers? If you condone it, I think that is most unfortunate. This recent Federal Court finding in Brisbane was significant. But under Labor's revised industrial laws it would have been much lower. If Mr Shorten is serious that he has zero tolerance, he needs to support this legislation. (Time expired)
My question is to the Minister representing the Prime Minister, Senator Brandis. Is PricewaterhouseCoopers correct when it says that more than one third of Australia is in recession?
Senator Ketter, I did see that report, and what I think you need to do is look at the real story—the real facts—because there is strong and broad momentum in the Australian economy, with growth of 0.9 per cent in the first three months of this year, an annualised growth rate of 3.6 per cent, which, as Senator Cormann reminds us, is about the fastest growth rate in the industrialised world. It was 2.3 per cent last year. It was 1.9 per cent in the last year in which the party you represent was in government. It was 1.9 per cent under Labor, 2.3 per cent in the first year of the Abbott government and, at the moment, on an annualised basis, it is 3.6 per cent, in the second year of the Abbott government.
Housing construction is booming, up 4.7 per cent in the March quarter—the best quarterly result in six years. Residential building approvals are 16 per cent higher than they were a year ago. They are at near record high levels. Exports increased by five per cent in the March quarter, the strongest quarterly increase since September 2000—the largest quarterly increase in 15 years. Exports are over eight per cent higher this year than the equivalent time last year. Service exports in areas such as tourism and education are up eight per cent over the past year, the fastest growth since 2007. Retail sales are up 4.1 per cent over the past year. There is a reason why our economy is growing as strongly as it is, and that is the policies of this government.
Mr President, I ask a supplementary question. Is PricewaterhouseCoopers correct when it says that one in every five dollars of national income is produced by just 10 of 2,214 locations in Australia?
Senator Ketter, I read the media report of the PricewaterhouseCoopers report. I cannot pretend to have read the report myself, but I did notice in the table that was reproduced in the media report that the principle areas in which economic activity was generated were the CBDs of the great capital cities—the postcodes of the CBDs of the great capital cities. Of course, that is what you would expect. Of course you would expect that the CBDs of Sydney and Melbourne and Brisbane and Perth—
And Adelaide.
Thank you, Senator Bernardi—and Adelaide and, indeed, Hobart would be where business is concentrated, where the services sector in particular is concentrated, and would be the locality from which, overwhelmingly, the largest amount of economic growth is generated. That is a matter of common sense, Senator Ketter. But we should look at the position of the economy overall. (Time expired)
Mr President, I ask a final supplementary question. With one-third of Australia in recession, high unemployment, slowing growth and growing inequality between the different parts of the Australian economy, can the minister advise when the Prime Minister decided to junk his promise to build a stronger economy so everyone can get ahead?
Senator Ketter, not a day has gone by since this government was sworn in on 18 September 2013 when we have not been building a stronger and better economy for a more prosperous Australia, trying to turn the economy around from the economic basket case that was left to us by the party which you represent.
Senator Ketter, I quoted you figures about economic growth—3.6 per cent annualised this year, the fastest in the developed world. I quoted you the figures about housing construction and retail sales. Let me give you some more evidence of the success of the Abbott government's policies: the NAB business confidence index jumped four points to plus-seven points in May as a direct result of the budget. Business confidence is at the highest level in a year and well above the average which it had when the Labor Party was in power. Meanwhile 110,000 new jobs have been created this year alone. (Time expired)
My question is to the Minister for Finance, Senator Cormann, representing the Treasurer: will the minister update the Senate about the benefits of the government's small business package?
I thank Senator Canavan for his question and his strong interest and advocacy for small business, in particular in his home state of Queensland. The small business and jobs package is a central part of our economic plan for stronger growth, more jobs and to ensure that everyone across Australia has the best possible opportunity to get ahead.
Since budget night, my colleagues and I have travelled across the length and breadth of Australia, meeting with small business owners and their employees. It has been a truly humbling experience to see the people at the coalface who are generating our economic success and employing more Australians as they become more successful.
What we are hearing from small business around Australia is that they feel energised by the small business measures in our budget, including and in particular small businesses in Senator Canavan's home state of Queensland. It has given them the confidence to carefully invest in growing their business and to take just a number of examples in Senator Canavan's home state of Queensland—Rockhampton—we have had feedback from Sarah Becker from Becker James & Co accountants who told us about her many clients who are taking advantage of the small business package and the $20,000 mini tax deduction for small business by purchasing a series of assets and pieces of equipment to invest in their future capacity. Mr Chris Harris from C.T. Harris and Co, who is also in Rockhampton, has applauded the small business tax package explaining that many of his clients are already taking up the $20,000 immediate tax deduction and bringing forward the acquisition of items that were previously only on their wish list. They are small businesses who of course will use the purchased assets to generate income, employ more staff and boost struggling regional economies along the way. (Time expired)
Mr President, I ask a supplementary question: will the minister inform the Senate how the government's budget initiatives for small business will help farmers and graziers?
Certainly our small business and jobs package has been widely welcomed by rural and regional communities. For example, Ken McCaffrey, a well-known livestock agent in Senator Canavan's home state of Queensland, has told us that he has been talking to a number of property owners who are ordering new fencing and getting started on boosting their water storage capabilities. Thanks to some welcome showers of rain in parts of central, western and southern Queensland in recent days, they may well have a little more water to store along the way.
Overall, Mr McCaffrey tells us, the fact that farmers can fully deduct the cost of water facilities and fencing the year they purchase and deduct the cost of water storage assets over three years has meant not just a boost for those farmers but also for related businesses in rural communities that will be supplying the fencing materials and other equipment required.
It is fair to say that businesses across rural and regional Australia have very much welcomed this budget initiative. (Time expired)
Mr President, I ask a final supplementary question: can the minister also outline for the Senate how these and other government budget measures will continue to benefit small businesses right around Australia?
I am pleased to inform the Senate that the tax deductions the government legislated last week with the support of the Senate will continue for a full two years. That means small businesses will be able to continue to instantly write off purchases up to $20,000 until June 2017.
As I have indicated, small business feedback has been very positive. They have told us that allowing the tax offset for two full years was a wise decision, because it allows small businesses the time to consider their decisions so they can make the best choices in the long-term interests of their business.
As you know, the Senate has also voted to support our 1.5 per cent tax cut for small business for those small businesses with a turnover of less than $2 million. This will mean, as of 1 July 2015, that small business will have the lowest tax rate since 1967. With the passing of these measures, we have delivered the lowest tax rate to small business since 1967. (Time expired)
My question is to the minister representing the Prime Minister, Senator Brandis: I refer to the teaching letter or encyclical of Pope Francis which calls for an urgent moral response to the scientific reality of global warming, rampant environmental destruction and extreme poverty.
Honourable senators interjecting—
Order on both sides but particularly my right! Senator Waters, I am going to ask you to start the question again. I could not hear it and nor could Senator Brandis.
Thanks, President; I will commence again. I refer to the teaching letter or encyclical from Pope Francis, which calls for an urgent moral response to the scientific reality of global warming, rampant environmental destruction and extreme poverty and condemns indifference, denialism and obstructionism.
Honourable senators interjecting—
Order, on both sides.
Forty-two per cent of the Abbott cabinet is Catholic, including the Prime Minister himself, who, of course, once trained to be a Catholic priest. This government has rolled back—
Government senators interjecting—
On my right.
our effective price on carbon pollution—
Honourable senators interjecting—
Order! Just a moment, Senator Waters. Order!
I think we have hit a sore point, President.
Just a moment, Senator Waters.
Can I be allowed to continue at some point?
Honourable senators interjecting—
On both sides!
I raise a point of order, Mr President. I would like Senator Canavan to withdraw his comment; he reflected on Senator Waters.
Honourable senators interjecting—
Order! I did not hear what the comment was, but if Senator Canavan believes he needs to withdraw, I will accept that.
I did reflect, and I am happy to withdraw, Mr President.
Thank you, Senator Canavan. Senator Waters, would you like to continue with your question?
Government senators interjecting—
Order on my right!
I would very much like to, thank you, President.
A government senator: You are married, aren't you?
No, I am not, and that is an irrelevant question; my marital status has nothing to do with this chamber.
This government has rolled back our effective price on carbon pollution, and, today, in the Senate, is seeking to slash the clean energy target. The Prime Minister has failed to listen to the scientists. Will he now listen to the leader of his own church, and abandon his attacks on the clean energy target?
Before I call Senator Brandis, Senator Waters, it is not in order for you to refer to a senator's religion, so I am going to rule that portion of the question out of order, which did reflect on other parts of the question, and I will invite the minister to answer what parts of the question he wishes to.
I think, Senator Waters, for you to reflect upon the religious beliefs of any member of this parliament, whether they be members of the government or they occupy any other office in this parliament, is disgusting.
Honourable senators interjecting—
Order! There will be quiet on both sides—on both sides! Order!
Mr President, I raise a point of order, if I may, on relevance. I did not seek to refer to the Prime Minister's religious beliefs in a disparaging manner; I was merely asserting the facts and asking whether or not they will respond to Pope Francis's encyclical. I would like an answer to that question, please.
Senator Waters, under Odgers it clearly states that it has been held that it is not in order to refer to a senator's religion in debate—full stop. There is not a qualification to that, so you are not to refer to that. Now, Senator Waters, do you have a supplementary question?
Well, just further on that point of order, President: I am happy to withdraw that part of the question. I did not realise it would be so controversial. What I am interested in is a response to the substantive part of the question, which is whether or not this government will now desist in its attacks on a clean energy target, on the basis of Pope Francis's encyclical.
Senator Waters, the primary question has been answered by the minister. You are now at a point where you can ask a supplementary question. Do you have a supplementary question, Senator Waters?
I do, President, but—I do apologise—I really do not think there was a substantive answer from Senator Brandis.
Government senators interjecting—
Order on my right!
There was confected outrage and a refusal to engage on the substance. I really would like an answer, if Senator Brandis can share his—
Government senators interjecting—
Order on my right! Senator Waters, Senator Brandis was invited to answer what part of the question he wished to answer, and, if you bear in mind that your question was out of order in the first instance, I think I was generous in allowing him to answer what part he wished to. You are now at the stage where you can ask a supplementary question, and I will invite the minister to answer that question.
Mr President, I ask a supplementary question. The Pope has said in that encyclical, which everybody is so up in arms about, that we cannot solve the climate crisis without addressing the interconnected problem of extreme poverty. Rising seas and more extreme drought will hit the world's poorest the hardest. Does this government still believe that coal is good for humanity? And would they be willing to repeat that directly to the nations of Tuvalu and Kiribati at the Paris negotiations?
Senator Waters, I believe that coal is very good for humanity indeed—and it is particularly good for this country because it is our cheapest source of energy. It enables people who would otherwise enjoy a much lower standard of living than they do to enjoy a higher standard of living than they do, through paying lower electricity prices. The government is of course aware that there has been a very active debate about climate policy going on around the world for years, if not decades, now. And His Holiness the Pope, as the leader of one of the world's largest faiths, is perfectly at liberty to contribute to that debate, and we will consider respectfully what His Holiness has had to say—as we will consider all points of view.
Mr President, I ask a further supplementary question. Thank you, Senator, for answering, in part, my first question. My further supplementary question is this. The Pope's encyclical said:
We must regain the conviction that we need one another, that we have a shared responsibility for others and the world …
Today, in this building, faith leaders representing Australia's Buddhist, Anglican, Hindu, Muslim, Jewish and Catholic communities have endorsed Pope Francis's call to action. Will the government set its global climate goals in accordance with science or continue to shirk our global responsibilities and continue to be an international climate pariah?
I will tell you what we will be doing, Senator Waters: we will be setting our priorities and making our policy decisions in accordance with science and good public policy, not in accordance with theology.
My question is to the Minister for Indigenous Affairs, Senator Scullion, representing the Minister for Agriculture.
An honourable senator interjecting—
I have not asked it yet! Will the minister update the Senate about the benefits of the China-Australia Free Trade Agreement for Australian farmers?
I thank the honourable senator for his question. It is vital to highlight that China is now the world's largest importer of agricultural food and fishery products, worth well over US$115 billion, and that was in the 2013 calendar year. This means there is fierce competition to supply the Chinese market and, with this agreement, Australia is well placed to meet that challenge.
The FTA is a very good result for agriculture in Australia. It will be good for all the food and fisheries producers and exporters. It closes the gap between Australia and those who already have FTAs with China, such as New Zealand, Chile and the ASEAN nations. The agreement struck by this government provides a significant advantage over our major competitors, such as the US and the EU, who do not have FTAs with China. The signing of the China-Australia Free Trade Agreement last week is a significant milestone for Australian agriculture, and now we can work towards this agreement coming into force later this year.
The significance of this market for Australian primary producers lies in the fact that we exported around $9 billion worth of agricultural products to China in 2014 at tariffs of up to 30 per cent, which makes us less competitive and our producers less profitable. This FTA agreement eliminates tariffs on many key products, mostly within four to eight years, including key growth commodities like beef, sheep meat, hides, skins, livestock, dairy, horticulture, wine and seafood. That means that the blockages on the other end of our supply chains are being removed by this agreement. This is proof that this government is truly committed to achieving real outcomes for rural and regional Australia.
Mr President, I ask a supplementary question. Can the minister explain how the government's white papers on northern Australia and on agricultural competitiveness will deliver for rural and regional Australia?
I certainly can, as last week, in a further sign of our commitment to regional and rural Australia, this government released the white paperon developing northern Australia. We are investing $700 million in transport infrastructure, including $100 million to upgrade cattle roads. In addition, we are investing $75 million to establish a northern cooperative research centre with a focus on agriculture to help solve some of the issues that have impeded development in the past. We have set aside $200 million for water infrastructure capital spending in the north and additional funds to fund water development studies. Having water available in the right area is crucial for economic growth. The measures outlined are but a few of the initiatives contained in this landmark document, and it will be complemented with a further vision for agriculture more broadly when the Minister for Agriculture releases the agricultural competitiveness white paper in the coming weeks.
Mr President, I ask a further supplementary question. Is the minister aware of any alternative policies for rural and regional Australia and, if so, what would be their effect?
As it happens, I am not aware of any alternative policies that would support regional and rural Australia—at least, none from those opposite, certainly. In six or so years under the previous government, we saw agriculture become nothing more than a policy afterthought. Slashing of the agriculture department's budget, shutting down of trades and complete lack of interest in or understanding of rural and regional Australia typified their time in office. By contrast, we have two white papers, three free trade agreements and six new live export markets, which are the tip of the iceberg when it comes to this government's commitment to agriculture. We on this side believe our prosperity as a nation is intrinsically linked with the fortunes or rural and regional Australia. We will continue to ensure we do our best to deliver better outcomes for our primary producers and our rural and regional communities into the future.
My question is to the Minister representing the Minister for Education, Senator Birmingham, regarding the leaked proposals for school funding in the Federation green paper. The education minister has tweeted today:
The Australian government does not and will not support a means test for public education. Full stop. End of story.
But the Prime Minister, on the other hand, has said it is a creative idea and was not closing the door. However, I now understand he has ruled this out in question time. Can you confirm the official position of the government on means testing public education?
I thank Senator Wright for her question. Clearly Senator Wright was not listening or paying any attention when Senator Brandis answered a near-identical question in question time earlier. But if it helps Senator Wright, I can be absolutely clear that we have no intention of supporting any policy that charges wealthy parents for their children to attend public schools. That is not the government's policy. The Australian government does not and will not support a means test for public education. Full stop. End of story.
I think we a seeing quite a hysterical scare campaign to what is an options paper that is designed to canvass all scenarios.
Opposition senators interjecting—
Senator O'Neill and those opposite can get worked up about it if they like, but they may be wise to heed the words of the South Australian Premier, Jay Weatherill, who said:
… "it's only a discussion paper".
… … …
"We've been asking them to canvas the broader range of options," …
"There's a broad debate going on about Commonwealth/state relations, which is a good thing."
South Australian Labor Premier Jay Weatherill says it is a good thing that the whole suite of options is being canvassed. That is not to say that any of those options is necessarily our policy, Premier Weatherill's policy or any other government's policy. The debate underway is a full consideration of how the Federation could be addressed and could be reformed to ensure we have a more effective delivery of education services and of school services in the future because we are seeing Australia's performance going backwards. Despite record levels of funding going in, performance is slipping backwards. That is not good enough, and we have to address why that performance is going backwards. (Time expired)
Mr President, I ask a supplementary question. That one has been ruled out. Another proposal in the paper is cutting all federal funding for public schools. Is the coalition really brave enough to go to an election proposing to cut all funds for public education, or can you now also rule out abandoning the two million Australian students who attend a public school?
Senator Wright appears to misunderstand what the notion of the Federation white paper is. It is looking holistically at all elements of the Federation. This is not a narrow discussion purely isolated to school funding. It is a discussion looking at education, looking at health and looking at tax and revenue. Senator Wright, I am quite confident that were any agreement to be made with the states that reformed any element of funding, the states would equally expect to have greater security over revenue streams to offset such funding. The government will not be leaving schools worse off, the government will not be leaving school students worse off, and the government will not be leaving public education worse off. We will simply be ensuring that we have a proper discussion with the states that deals properly with how we get the best possible management of our schools into the future.
Mr President, I ask a further supplementary question. Education Minister Pyne is on the record as saying that your government, Minister, has an emotional commitment to private schools. Do you have an emotional commitment to public schools—and if not, why not?
We are canvassing religions and schooling today, it seems. Yes, I have an emotional commitment to public schools. I have an emotional commitment to Gawler High School, where I attended; I have an emotional commitment to public schools right around Australia, and I expect to see the best possible outcomes. I would encourage Senator Wright to read the whole discussion paper. Is says that spending by all Australian governments grew by 37 per cent in real terms in the 10 years between 2002-03 and 2012-13, yet we now have fewer high achievers and more low performers than we had a decade ago. So, while how much funding schools get is important, it is not the silver bullet for better results. How it is spent matters more.
Opposition senators interjecting—
On my left!
This government wants to see it spent well and see it spent efficiently and effectively. We are committed to continuing record funding for schools, but we want to ensure that record funding delivers better outcomes—unlike what has occurred in the past. (Time expired)
My question is to the Minister for Human Services, Senator Payne, representing the Minister for Trade and Investment. Can the minister please update the Senate on how the recently-signed China-Australia Free Trade Agreement has been received by Australian industry?
I can indeed update the Senate, because this is a fabulous story, as Senator Scullion was recently adverting to in his observations about the benefits for agriculture in Australia. The China-Australia Free Trade Agreement is going to unlock substantial new benefits for Australians for decades to come. In fact, industry has been universal in its praise for the agreement, which will see unprecedented access for Australian business to the world's second-largest economy.
Let me cite a couple of those. The Business Council of Australia said:
This historic agreement is a transformative moment for the Australian economy. It puts many of our most important sectors on a more competitive footing internationally, and gives Australian companies enormous scope to boost trade and create jobs.
Similarly, the Australian Industry Group has said that:
The agreement … will provide Australian business with more export and investment opportunities through opening up access to the large Chinese market …
And the Winemakers' Federation stated that this:
… much-awaited free trade agreement with China seals this year's trade trifecta and has the potential to add tens of millions of dollars to the Australian wine industry's export earnings.
What ChAFTA will do is create jobs and drive higher living standards for Australians. It is a transformational agreement that removes barriers to trade and investment and represents a high water mark in our relationship with China. I know that the free-trade forums being run by Minister Robb, Minister Billson and, on occasion, the Prime Minister, are attracting enormous attention from local businesses from one side of the country to the other. All of the industry groups that represent the members of those organisations are, in fact, confirming for the Australian government and for the Australian people the extraordinary value of the China-Australia Free Trade Agreement.
Mr President, I ask a supplementary question. Can the minister explain which sectors stand to benefit the most from this historic trade agreement?
On current numbers, 85 per cent of Australian goods exports to China will be tariff-free but, at the time of full implementation of ChAFTA, that will rise to 95 per cent of Australian goods exports to China being tariff-free. Significantly, and I think Senator Scullion mentioned this as well, tariffs will be abolished for Australia's $13 billion dairy industry. I know how welcome that will be—particularly on the south coast of New South Wales, for example. Tariffs of up to 25 per cent will be removed for Australia's beef and sheep farmers. Tariffs of 14 to 30 per cent on Australian wine—and I referred to the Winemakers' Federation views earlier—will go within four years. Tariffs also will be eliminated on a wide range of Australian manufactured goods, particularly pharmaceutical products, which will be a great benefit to that industry in Australia. (Time expired)
Mr President, I ask a further supplementary question. Can the minister explain how the agreement further demonstrates that Australia is open for business?
It is worth noting that the negotiations for this free-trade agreement with China commenced under the government of Prime Minister John Howard and have been completed by the government of Prime Minister Abbott. Between 2007 and 2013 the talks languished pretty sadly, but we have now built on trade deals already concluded with Korea and Japan. ChAFTA forms part of a powerful trifecta of agreements with three of Australia's largest export markets, which account for more than 61 per cent of our exports of goods. In 12 months we have achieved what Labor could not achieve in six years. This trade trifecta is further proof that Australia is absolutely open for business. It is giving us better market access to the world's second-largest economy, it improves our competitive position in a rapidly-growing market, it promotes increased two-way investment and it reduces import costs. It is a win-win for households and businesses alike, and it is a job creation boom. (Time expired)
My question is also to the Minister representing the Minister for Trade and Investment, Senator Payne. I also refer to the China-Australia Free Trade Agreement and its investment facilitation arrangement provisions, which allow temporary migration to fill jobs on infrastructure projects worth $150 million or more. Will the government retain existing labour market testing safeguards to ensure temporary migration is only used to fill positions on investment facilitation arrangement projects where employers cannot find suitably skilled local workers to do the job?
I thank Senator Wong for that question. I can reassure the Senate that exactly the same safeguards are in the ChAFTA as existed under agreements finalised by the previous government. It means employers implementing major projects have surety when they decide to make a major investment that if they can demonstrate that there is a skills shortage they are allowed to bring in, for example, skilled workers for the appropriate limited period.
Mr President, I ask a supplementary question. I also refer to comments about the China-Australia FTA by the Prime Minister . At a media conference last October he said, 'On the 457s, labour market testing will remain.' Can the minister confirm that, in fact, under the China-Australia FTA labour market testing will not be required for contractors, installers, services and others from China seeking 457 visas?
I thank Senator Wong for that question. I am not sure I have all the detail that Senator Wong would require for an answer to that question. But let me say that, in relation to the safeguards in ChAFTA, to be approved for a project agreement a company must meet a number of requirements which are outlined in a set of publicly available guidelines. Contrary to what many commentators have said it is not simply the case that Chinese companies are able to bring in their own workforce without checks and balances. The Project Agreement Program allows infrastructure or resource development projects experiencing genuine skills or labour shortages access to temporary skilled and specialised semiskilled temporary overseas workers through the subclass 457 visa. There are a number of other points but if I do not have the correct information I will take it on notice and provide further information to the senator.
Mr President, I ask a further supplementary question. I note that the minister will appropriately take aspects of that question on notice. There is inconsistency between what the Prime Minister said last year and the text of the agreement. Can the minister please explain that? Can she also provide assurances that the labour provisions in the China-Australia FTA will enhance, not constrain, local job opportunities?
I can certainly provide that assurance, and I have made that clear in the chamber on a number of occasions in relation to these issues. I will provide the senator with further information on those matters that I have taken notice.
My question is to the Assistant Minister for Social Services, Senator Fifield. Can the minister update the Senate on the government's implementation of the Commonwealth Home Support Program which comes into effect on 1 July?
I thank Senator Seselja for his question and his strong work on the community affairs committee of the Senate. Colleagues may be aware that, on 1 July, the Commonwealth Home Support Program will commence as the entry level service for aged-care services. The Commonwealth Home Support Program will bring together Commonwealth Home and Community Care Program, planned respite from the National Respite for Carers Program, Day Therapy Centres and the Assistance with Care and Housing for the Aged Program into one streamlined program. Under this program around 550,000 older people and their carers will continue to be supported with services such as delivered meals, domestic assistance and support for people with dementia, which is all core business for the CHSP. Providers will benefit from streamlined funding arrangements, less red tape, simplified grant agreements and more time to provide services. Also, older people will benefit from a standardised national assessment process and a single entry point through the My Aged Care gateway.
Importantly, the government has announced that CHSP funding agreements will be extended from 30 June 2018 to coincide with the implementation of the 2015 budget measure to merge the CHSP and the Home Care Program from July 2018 to create an integrated Home Care Program. The funding announcement through to June 2018 will provide three years of certainty for CHSP providers and more than $1.6 billion annually in funding. It is an important change that will provide some certainty for providers.
Mr President, I ask a supplementary question. Could the minister update the Senate on the status of the fees policy for the Commonwealth Home Support Program?
Under changes initiated by the previous government a national mandatory fees policy for CHSP was proposed to bring greater consistency to fee arrangements nationwide. A CHSP national fees policy consultation paper was circulated in March for industry feedback. Having taken on board community feedback, and in light of the planned new Home Care arrangements from 2018, the government has decided not to proceed with a mandatory CHSP fee schedule from 1 July. Instead, I will look at a fees framework which outlines principles that providers can adopt in setting and implementing their fees, leading to greater consistency and fairness. This will prevent fees from exceeding the cost of the service and ensure that there is a safety net for those who need it. In addition, there will be a national fees guide developed to increase transparency for consumers and providers. I have taken on board in particular the views of volunteers, Meals on Wheels and community transport.
Mr President, I ask a further supplementary question. Can the minister advise the Senate of third-party support for his decision on the Commonwealth Home Support Program?
The changes to the CHSP fees policy have been welcomed by Aged and Community Services Australia, the Combined Pensioners and Superannuants Association and the Community Transport Organisation to name a few. The coalition broadly adopted an essentially bipartisan approach to aged care when in opposition; we lent our support to the then Labor government and the general thrust of their legislation. It is peculiar that the current opposition now seek to criticise the government for making a careful policy decision based on widespread sector feedback. It would not be responsible to implement a policy without regard for the considered views and expertise of service providers and older Australians and, in particular, it would not be good to neglect the views of volunteers, Meals on Wheels providers and people in community transport organisations. Their views should be listened to, and they have been heard. (Time expired)
My question is to the minister representing the Prime Minister, Senator Brandis. I refer to the leaked letter by Mr Hunt last week regarding crossbench negotiations to establish a wind farm commissioner, which came as a complete surprise to the minister in question time. I ask the minister again: will the Abbott government be establishing a wind farm commissioner?
Senator Singh, with great respect, you have misled the Senate. There was no letter. A draft document, unsigned and provided in draft form, is not a letter. No decision has been made in relation to that matter at all. As you know, Senator Singh, the government has discussions with the crossbench all the time, as does the opposition. It should come as no surprise to you that there were discussions between the government and the crossbench in relation to this matter. But please do not—because you know better than this, Senator Singh—represent a draft document, which forms part of a discussion, as a policy decision of the government, because it is not.
Mr President, I ask a supplementary question. I refer to Mr Graeme Innes, the former Disability Discrimination Commissioner, whose position was axed by the government last year. Given the Abbott government's recent decision to appoint a wind farm commissioner, does the minister agree with Mr Innes's assessment that this sends 'a very clear message about where people with disabilities fall in the pecking order'?
First of all, Senator Singh, please, I must correct you: the government has made no such decision. In relation to Mr Graeme Innes, it is not right either to say that the position of Disability Discrimination Commissioner has been axed—in fact, we have a very, very good disability discrimination commissioner at the moment; namely, a former Labor cabinet minister, former Senator Susan Ryan, and she is doing an outstanding job—
Senator Cormann interjecting—
Mathias, don't go there please! I recently tasked Senator Ryan to lead a community consultation and report into discrimination against older Australians and Australians with a disability. It is a job which she undertook with alacrity, and she is doing a fine job as Disability Discrimination Commissioner.
Mr President, I ask a further supplementary question. Can the minister explain why wind farms are more important than people with disability?
(—) (): If I may say so, Senator Singh, what an insulting thing to say to Australians with a disability. What an appalling thing to say to Australians with a disability—because we have a disability discrimination commissioner at the moment. We have the Disability Discrimination Commissioner at the moment who is actually working very effectively to address issues facing people with a disability. That is why former Senator Susan Ryan is leading an inquiry into discrimination against people with a disability and against older Australians—a perfect complementarity of her two roles. Senator Singh, for you to suggest, as you do by implication in your question, that people with a disability are not of the utmost concern to any Australian government is preposterous. (Time expired)
Honourable senators interjecting—
Order on both sides, particularly on my left!
My question is to the Assistant Minister for Education and Training, Senator Birmingham, representing the Minister for Education and Training. Will the minister update the Senate on how the government is assisting small and medium-sized enterprises to grow and take advantage of new and emerging markets?
I thank Senator Sinodinos for his important question in relation to our support for small business and medium-sized businesses, particularly to grow their skills base, to invest in their employees and to develop the types of skills that will enable them to grow their businesses and to pursue new trade opportunities, particularly the types of trade opportunities that are available as the new free trade agreements with China and Korea and Japan and, ultimately, India come on-stream.
Our Industry Skills Fund is providing $664 million of support to Australian businesses to enable them to deliver training to around one-quarter of a million—some 250,000—Australians over the next five years. This will help them to identify the skills they need in their businesses and the skills their employees need. It will help them to be able to grow as businesses and ultimately create more jobs and more opportunity for more Australians. As a key part of the fund, today I have announced that the government will invest $43 million over the next three years in the Industry Skills Fund Skills Adviser Network. The network will provide intensive support to businesses who are looking to grow, especially to grow through the development of their workforce. These skills advisers will provide clear, independent written advice on the skills, needs and opportunities of a business at no cost to those small to medium-sized businesses. It will provide them with the opportunity to see how and where they can invest, be it in accredited or qualified training or through non-accredited opportunities that can still deliver demonstrable benefits to those businesses to reskill their workforces, to upskill their workforces, and to create new opportunities to grow their businesses and their export markets and to create more jobs and opportunities, not just for their existing employees who will benefit but also through that growth and creation of new jobs which is central to the overall ambition of our Industry Skills Fund.
Mr President, I ask a supplementary question. Can the minister update the Senate on the uptake of skills advice provided to Australia's SMEs?
I am pleased to inform the Senate and Senator Sinodinos in particular that we have, in the first few months of operation, delivered skills advice to hundreds of Australian businesses, 97 per cent of whom are small and medium-sized enterprises. Of course, as a government whose most recent budget is centred around creating growth and opportunities in investment from SMEs, it is critically important to us that they also have the capacity to access the skills advice they need. Fifty six per cent of skills advice requests were for small or micro businesses, while 41 per cent were for medium-sized businesses.
The feedback has been exceptional. For example, Power Pumps and Engineering in South Australia have said of the fund: 'It was easy to apply for and staff were most helpful. The recommended courses were good and I thought the skills adviser was excellent.' Indeed, Barker Trailers have said: 'Industry skills funding helps us to justify training as many staff as we could and supported us to make this decision.' It is delivering real outcomes on the ground. (Time expired)
Mr President, I ask a further supplementary question. Can the minister tell the Senate how the government is assisting northern Australian businesses with skills advice and training?
Thank you again, Senator Sinodinos. The government want to make sure that this Industry Skills Fund and the Skills Adviser Network deliver particular benefits to northern Australia as part of our overall growth strategy for northern Australia. So we have broadened the availability of the $664 million Industry Skills Fund to businesses seeking to expand their operations in northern Australia. Co-contribution rates under the Industry Skills Fund for businesses in northern Australia will be reduced such that, in particular, small, medium and larger businesses will have a lower level of co-contribution and will be further encouraged to invest in the skills of their workforce to be able to grow their base in the north. In addition, five skills advisers will be provided to particularly encourage and provide advice to businesses on how to invest in upskilling or reskilling their workforces in northern Australia. This is a key investment that complements the northern Australia strategy our government has and overall is about lifting the skills base of Australian workers and growing our economy in totality.
Mr President, I ask that further questions be placed on the Notice Paper.
I would like to add further information to an answer I gave to Senator Whish-Wilson on 18 June and provide further information to the questions taken on notice on that day—and I have given Senator Whish-Wilson notice of this. The government advise that we do not accept the premise of Senator Whish-Wilson's question. There is no evidence that 'thousands of manufacturing workers' will lose their jobs as a result of the continuation of Australia's decades-long bipartisan commitment to freer trade. In fact, independent modelling commissioned by the government forecasts that jobs will be created as increased exports and cheaper imports allow Australian businesses to hire more workers. The annual net jobs increase is forecast to be almost 8,000 in 2016, peaking at almost 15,000 in 2020.
Regarding industry policy specifically, there is no change to the government's existing arrangements to support growth and innovation in Australian industry. The government supports growth, jobs and competitiveness of Australian industries through the Industry Innovation and Competitiveness Agenda. This includes a range of initiatives and programs, including the Industry Growth Centres Initiative, the Cooperative Research Centres program, the Entrepreneurs' Infrastructure Program, the R&D tax incentive and the Manufacturing Transition Program.
I move:
That the Senate take note of the answer given by the Attorney General (Senator Brandis) to a question without notice asked by Senator Ketter today relating to the economy.
The groundbreaking work that has been released today by accounting giant PricewaterhouseCoopers shows very clearly that one in every five dollars of national income is produced by just 10 locations in the country out of some 2,214 nationally. Despite that, and despite Senator Ketter asking very clearly for Senator Brandis to respond to the fact that this demonstrates a definite inequality in our country and has led to a slowdown in economic growth in our country, Senator Brandis, as with many of the answers he gives in this place, instead tried to put his head in the sand and pretend everything is rosy. Everything is all right, despite all of the findings that have come out in this PricewaterhouseCoopers report.
Not only has PricewaterhouseCoopers identified that economic growth is coming from less than 0.5 per cent of our nation's landmass; on top of that, we have had the report of the Australian Council of Social Service today, which clearly shows that inequality in this country is higher than the OECD average, and particularly that it is higher in many of the regions. We know from this report that there are certain parts of this country where one-third of Australians are in recession.
Despite Senator Ketter asking Senator Brandis to address the very specific question which comes out of the PricewaterhouseCoopers report, what we got from Senator Brandis was some diatribe about building approvals being higher and that we have the fastest economic growth rate. We know very clearly that our economic growth has slowed. Senator Brandis knows our economic growth has slowed. The annual growth rate in this country has in fact declined from some three per cent in the year to March last year to only 2.3 per cent now. We also know that Australian incomes are down—including, of course, the incomes of cleaners in this place. This government is cutting the wages of cleaners who clean our Parliament House offices. We know that business confidence is down, that consumer confidence is down and that wages growth has slumped, while unemployment is up.
Despite all of that and despite the findings of the PricewaterhouseCoopers report, Senator Brandis very clearly chose to put his head in the sand and pluck out a few positive stats that he found in his notes as a means of trying somehow to discredit the findings of this very important, groundbreaking report. Two important reports have been released, by PricewaterhouseCoopers and ACOSS, and both of them point to the same outcome, and that is a growing inequality in this country—a growing inequality that this government does not seem to want to do anything about.
Unlike the government, Labor have a plan to address growing inequality, because we believe in lifting people out of poverty and ensuring that we live in a society that is based on the principle of equality. That is why our leader, Bill Shorten, in his budget reply speech, promised to invest in nation-building infrastructure. We know if we invest in nation-building infrastructure, especially in our regions, in our cities, in those areas of disadvantage, those issues of economic decline can be addressed, those issues that the PricewaterhouseCoopers report and the ACOSS report specifically refer to. They are areas that are the biggest losers, such as Nanango in Queensland and the La Trobe Valley in Victoria, which ranked very badly in their report. We can help in their transition to a clean-energy future.
These are the kinds of forward-thinking ideas that a government should be looking at. It is these kinds of reports—the PricewaterhouseCoopers and ACOSS reports—that the government should be scrutinising, looking at in detail, and making policy recommendations to its cabinet to ensure it addresses it—that is if it believes in a country where everyone gets to share in the wealth and profits of it not just those few at the top who are identified in these reports. That is shameful of this government. (Time expired)
I would suggest to Senator Singh that she have a look at that report and have a look at the graph in that report showing the proportion of GDP concentrated in just 10 locations. You will see, if you look at that report and the graph, that most of the 'badness' in the report occurred in the years of the Labor government. Even the dysfunction shown in recent times is the rollover, the follow-up, from the Labor Party. So before the Labor Party misread—perhaps deliberately—these reports, they should understand that it was their party that caused this problem.
Why did the progress, the economic growth, in rural and regional Australia fall during the time of the Labor government? The first thing I can point to is the ban on live-cattle exports, the most disastrous, stupid, uninformed and ill-researched decision that any government has made for as long as I have been here and I suspect even longer. That one decision—made overnight, by the Gillard government and Senator Ludwig when he was the minister for agriculture—decimated rural and regional Australia, particularly in the north of Australia, where beef cattle and live exports were so important. The industry was not doing too badly, and then—overnight—by a decision of the Labor government the income to that very significant industry in the north was stopped. As a result of that—in addition to suicides—the economic growth of those parts of rural and regional Australia has plummeted. You can thank the Labor Party and the Rudd-Gillard-Rudd governments for that.
So before you get up and look at these reports, Senator Singh, I suggest you study them and understand that most of the things you complain about occurred during the time of the Labor government. If you have a look at the graph—and I invite you to do that—you will see that during the latter Howard years the increase in rural economies was much better. It is only in the Labor years that rural economies have gone backwards.
It's not true! It's actually 2014.
Have a look at the thing. Your government was there from 2007 to 2013—economies do not change overnight. That is the rollover from the Labor government. As Senator Brandis quite rightly said, in recent times the Australian economy has been growing faster than any other economy in the Western world. Things are starting to come right. But it was during the Labor years that this problem came about.
I thought the Labor Party might have taken note, today, of the schools-funding issue. They have an MPI about it, later today. I do not know what anyone is going to talk about at the MPI because, as Senator Brandis and Senator Birmingham quite clearly said, there will be no such funding cuts, and funding of state schools is a matter for state governments. Even Mr Weatherill, the Labor Premier of South Australia, understands that.
Senator Wright asked during her question whether we had an emotional attachment to state schools. I always, in this chamber, very proudly say—unlike, I suspect, most of the Greens political party—I did all of my schooling in a state school and finished my high school in a state school. In fact, as my wife often reminds me, I liked my state school so much that we bought a house just opposite it—and we continue to live there. So we do have an emotional attachment to state schools, Senator Wright. I suspect most of the senators in the Greens political party went to private schools and would not understand state schools at all.
I also rise to speak in relation to responses given by Senator Brandis to questions that I asked. I asked a question about whether PricewaterhouseCoopers was correct when it said that more than one-third of Australia is in recession. Senator Brandis, in his response, chose to discuss what he considered to be the real facts, which I considered to be quite a selective representation of some of the economic indicators.
He did take time to make reference to the NAB monthly business survey and he talked about that being up on the 12-month figures. He was highly selective in quoting those figures. In the time the current government has been in office that particular index has been down by 75 per cent and we have seen wages growth slumping to the lowest level in two decades, at 2.3 per cent, to March 2015.
The questions I asked of Senator Brandis went to income inequality and concentration within the economy. I was very disappointed to hear the answers from Senator Brandis because, as Senator Singh has indicated, he has his head in the sand when it comes to these particular issues. When I asked about the concentration of the national income in just 10 of 2,214 locations in Australia, he advised rather glibly that, when one looks at the PwC report, the concentration is found to be in CBDs. He said, 'That is what we would expect to see.'
However, when you look at the commentary from the researcher, Mr Tyson, he identifies that, from a social and equity point of view, there are challenges and potential conflicts that arise from this concentration of the economy in particular areas. He talks about the consequence being that governments should increasingly focus on, for example, public transport to link some of the CBDs with suburbs where there are powerhouse locations of innovation—for instance, the greater Sydney area.
But this is an area where this government have been found wanting again, because they abolished the Major Cities Unit in 2013 and they are slashing infrastructure spending across the country by 11.2 per cent over the next four years. When it comes to looking at the issue of inequality in the economy, this is a government which are absolutely disinterested.
We should be interested in this particular issue because there have been studies that show that rising inequality has an impact on growth. There is IMF research to the effect that there are economic downsides to inequality. Raising the income share of the poorest 20 per cent of the population increases growth by as much as 0.38 percentage points over five years. By contrast, increasing the income share of the richest 20 per cent by one per cent decreases growth by 0.08 percentage points. When we see the response from this government one could almost assume that they are continuing to apply the trickle-down economic model. We can see that this particular approach has failed the people of Australia.
Senator Singh made reference to the report from ACOSS which was released today. One of the concerns that I have in looking at that report is that ACOSS has identified a number of the structures we have had in Australia which have been a retardant to inequality over a period of time. When one looks at those—the taxation system, the system of minimum wages that we have in Australia and our income support systems—one can see that these are all things which have been inhibitors of inequality. These are all of the things that this government is seeking to attack. Time does not allow me to talk about that, but this government is looking at higher inequality, and Labor will always be the party that stands— (Time expired)
This is all a bit embarrassing for the Labor Party today. We have a shadow Treasurer who does not understand or does not know what the tax-free threshold is. We have a former Treasurer who is still in the parliament who was responsible for racking up $240 billion in debt in six years when we did not have a recession. Now we are left with the legacy of that. But now it is starting to make sense because the Labor Party could not read a simple chart that was included in today's major business newspaper along with the report that they are trumpeting here as some kind of scandal.
Both Senator Ketter and Senator Singh have said it is a shock-horror scandal that 30 per cent of locations—actually 'ABS statistical area 2' is the designation they have used in this report—are in recession at the moment. You would think when you heard a stat like that—it is a pretty unusual stat; it is not something commonly referred to—you might think, 'Is that high or low relative to normal times?' There is actually, helpfully, a chart which answers that for them in The Financial Review. They do not have to read the report; it is there in the Financial Review article online. It is right there. The data very helpfully goes back to financial year 2002. It shows that the peak of areas in recession was under the Labor government. It was just slightly higher. Under the Labor government in the financial year 2011, there were more locations in recession than there are today. It also shows, going back over that 12-year period, usually something more than one-fifth of locations are in recession at any one time. That is what you would expect in a dynamic economy. Things change, markets change, prices change, and some areas do it tougher than others. Our job is to have a proper, seamless and flexible economy and policies in place to help those adjustments occur. That is always the case.
It was actually much, much lower under the Howard government. The Howard government had between 20 per cent and 30 per cent of areas in recession. It increased after the global financial crisis. Under the Labor government, it increased to over 30 per cent. I am not necessarily trying to blame the Labor Party for that like these guys are stupidly doing to us. I am not saying it is all their fault, because obviously there were other things that impacted on our economy at those times. Clearly, since those times, we have not been able to grow as strong an economy as we would like. We have moderate growth and an increasing amount of growth, but we still have more work to do.
The other really embarrassing thing is that those opposite have tried to hang so much off this graph. As you would expect, because we have not finished financial year 2015, the data in this report finishes in the last financial year. It has data only up to the last financial year. That means that those opposite are trying to pass judgement on nine months of the Abbott-Truss newly elected coalition government from September 2013 through to mid-2014. That is the only period in that time when the Abbott government was in power. There was no budget delivered by this government in that time; the then budget was the former government's budget. Their whole argument today hangs off nine months of the Abbott-Truss government, based on a comparative chart which shows that things were better under the last coalition government than when Labor were last in government. Now they are trying to say 'shock, horror, scandal' to the entire country.
It just shows that these guys are running out of ideas. They are running out of ideas. They are running out of arguments. They do not quite know what to do since the budget came down. They were scatter brained, all over the place, today in question time, with different questions on different topics, and they chose this topic because it was the only one in the newspaper that they thought they could give a run. It is embarrassing for them.
The notion that somehow one in five dollars comes from 10 locations is, again, apparently 'shock, horror'. That has increased over the last 12 years. Sometimes I do not think the Labor Party can read y axes, because it is not zero in this chart; it has increased from 16.5 to 17.9 over the last 12 years—a massive, massive change.
The other thing to take away from that is that of course it is concentrated, because the population in Australia is concentrated. Two-thirds of Australians live in capital cities, but only around a fifth of them—at least, in those 10 locations—are producing the wealth. So, they are actually underperforming. Our capital cities are not punching above their weight, because we all know that most of our export dollars and most of the wealth in this country is generated in regional areas, where only one-third of the Australian population lives. All our iron exports, all our coal, all our agricultural products and most of our tourism assets are actually in regional areas, and they are what produce the wealth for this country.
I also rise to take note of Senator Brandis's answers to questions asked by Senator Ketter in question time today on the important subject of the rising inequality we are seeing across the country, as outlined in reports by both PwC and ACOSS. I will just pick up on a couple of things that Senator Canavan said. He said that the questions from Labor senators this afternoon were embarrassing for the Labor Party. The Labor Party will always fight inequality when we see it, and the report released today shows that there is rising inequality across the country—and it is not just in the PwC report; it is also in the ACOSS report which was released this morning.
Rather than sheeting home the blame, which is what Senator Canavan just accused Senator Ketter of, Senator Ketter asked two very factual questions of Senator Brandis this afternoon. They were (1) whether the claim that more than one-third of Australia is in recession was correct, which I do not think was answered by Senator Brandis; and (2) whether it is true that every one in five dollars of national income is produced in just 10 of 214 locations in Australia. Again, I do not think that question was answered by Senator Brandis either. In terms of the answer that was provided, there were some areas with which I agreed—the fact that it is good that we are seeing economic growth across the country. Even if that growth is slow, it is a positive.
But I think any responsible government opening the paper today and seeing the news story about the PwC report, which as I understand it is going to be released tomorrow, would look at this very closely and as a government say, 'Okay, what do we need to do about this? If some parts of the country are doing well but others are clearly not doing well—indeed, a third of the country, in PwC's terms, is experiencing recession—as the government of Australia what we do about this?'
That is the point made by the ACOSS report, which claims that some elements of the social compact—that is, policies around full employment, universal access to public education, wage regulation, progressive income taxes and a well-targeted social security safety net—are key areas which address inequality in a country. It is these areas which seem to be 'unravelling', to quote the ACOSS report. It is also these areas which are under attack from this government, which does not lead us on this side of the chamber to believe that there is a serious plan to address the rising inequality in the country. As my colleague Andrew Leigh often says, central to tackling inequality is maintaining a sense of pride in our egalitarian ethos—that is, that we all work together to ensure that all citizens of Australia are treated equally.
In his answer, Senator Brandis said it is the policies of this government that will address these issues. But, when we look at the policies of this government, we see the cuts to schools and health funding, the attacks on pensioners—pitting pensioners against pensioners; that is what is contained in this budget, where we have pensioners having to justify their pension against other those of other pensioners—and cuts to services like homelessness services and community legal services. These are all services that ensure that we do have that egalitarian ethos, that we have fair wages for work performed. These are all central to the social compact that is being consistently undermined by this government.
Senator Brandis can pretend this is not his problem. Senator Canavan can say that it is everyone else's problem, 'It's the previous government's problem.' But the reality is that we are seeing rising inequality in this country, and it is not clear that there is a plan from the government to address it. Those on this side of the chamber will always stand up and draw matters like this to the attention of the chamber when they occur.
Question agreed to.
I move:
That the Senate take note of the answer given by the Attorney-General (Senator Brandis) to a question without notice asked by Senator Waters today relating to climate change.
When Senator Brandis's eventually responded to my question, I was somewhat amazed to hear what I can only describe as his faux outrage that I would note the well-known fact that the Prime Minister is Catholic. Apparently, that was in some way disgusting to Senator Brandis. As I said in the course of the question, I was in no way referring to that in a disparaging manner. I was merely wondering, given the Prime Minister has not listened to the scientists about climate change, that thinking people can only hope that he will now listen to the leader of his own faith, who has said that the world needs to take action on climate change, that we have a shared global responsibility to do so. I celebrate the fact that the Pope has come out and acknowledged that science. If the government will not listen to the scientists, perhaps they will at least listen to the Pope. Apparently, Senator Brandis found that confronting and offensive, which is quite peculiar. He used that as a premise not to answer the question. One wonders whether or not the government has such a visceral reaction to saying the Lord's Prayer, which we say every morning in this place—well, some of us say it, predominantly those on the government benches.
I also mentioned that the Pope had said that we need to deal with climate change because it will hit the world's poorest the hardest. Again, Senator Brandis resorted to that old chestnut about coal. He thinks it is in fact very good for humanity—not just good for humanity, like the Prime Minister and Senator Cormann have previously said, but very good for humanity. The incorrect premise on which he asserts that is that he says coal is cheap and that coal will somehow alleviate global poverty. Coal is cheap in Australia because this government continues the billions of dollars of subsidies to the fossil fuel industry. As we know, renewable energy is now reaching parity—wind has reached parity—with coal, even with its subsidies. Were those subsidies to be removed, as the Greens have long called for, renewable energy would be infinitely cheaper and, of course, infinitely better for the planet.
Senator Brandis also somehow reckons that coal is going to be a solution to global poverty. I have got news for you, Senator Brandis—and it is something that experts have been contending for quite a while now: there is no electricity network in those poor parts of rural India. Even if there were an electricity grid, coal would be at such a price that people could not afford to purchase it. The solution to energy poverty in developing nations is clean distributed renewable energy. Most people accept that that is flagrantly obvious, and I would urge the government to go and do some homework in that respect.
In relation to the final part of my question where I asked whether the government would base their climate policies on science or faith or anything at all, really, other than the lobbying of the fossil fuel donors that walk these halls very frequently, he contended that, yes, they would base their climate policy on science. That is very interesting, given that they abolished the Climate Change Authority shortly after taking government. In fact, they have sacked most of the scientists who used to work for the CSIRO on climate and other matters. It is wonderful that the government intellectually accept that they will base the policy on science. Where are those scientists? And are they now going to reinstate them? I certainly hope so.
What we see from this government is continued climate science denial and continued head-in-the-sand position to the positive opportunities that this presents us globally and domestically. We have some of the world's best sunshine. We have some wonderful tidal, geothermal and wind deposits. We see the government in a pathetic deal with the crossbench, which it is at great pains to deny, although everybody knows the legislation is about to pass through the parliament this afternoon. We will have a Wind Farm Commissioner. If this government were really concerned about the health impacts of energy, it would, as I said last week, establish a coalmine commissioner to look at the awful health impacts of coalmine fires that so frequently get out of the control, the particulates, and also the health impacts of climate change itself. This government just does not get the climate science. It clearly now does not even want to accept the Pope's encyclical. I do not know what their guiding principle is anymore, except the money that they get in donations from the fossil fuel sector.
Question agreed to.
by leave—I move:
That leave of absence be granted to Senator Abetz from 22 June to 25 June 2015 for personal reasons.
Question agreed to.
by leave—I move:
That leave of absence for personal reasons be granted to Senator Lines for today, 22 June 2015.
Question agreed to.
I move:
That—
(a) the Senate notes that:
(i) a significant number of video game development companies have recently experienced financial difficulties with their Australian operations,
(ii) this has led to a substantial loss of jobs and companies exiting the country,
(iii) the industry has been further negatively affected by the Abbott Government's decision to close the Australian Interactive Games Fund just 12 months after it was established, and
(iv) comparable countries such as Canada have seen a rapid expansion of their video game development industry over the same time frame; and
(b) the following matter be referred to the Environment and Communications References Committee for inquiry and report by 1 April 2016:
The future of Australia's video game development industry, with particular reference to:
(i) how Australia can best set regulatory and taxation frameworks that will allow the local video game development industry to grow and fully meet its potential as a substantial employer,
(ii) how Australia can attract video game companies to set up development operations in Australia and employ local staff,
(iii) how export opportunities from Australia's local video game industry can be maximised, and
(iv) any other related matters.
Question agreed to.
I move:
That the Senate—
(a) notes that:
(i) on 13 February 2015, health professionals, academics and policy makers met to sign the Melbourne Declaration on Building Integration and Reducing Migration Related Health Inequity,
(ii) the health status of migrants and their access to health care is influenced by their channel of migration (voluntary, humanitarian or seeking asylum), language proficiency and circumstances in their countries of origin, and
(iii) immigration presents challenges to the health systems of the host country in the delivery of culturally competent health and social services, and exacerbates disparities in health status between the migrant and host populations; and
(b) calls on the Abbott Government to:
(i) protect the health of, ensure health service provision for, and reduce health inequities of people from migrant and refugee backgrounds including forced and undocumented migrants,
(ii) ensure the provision of culturally appropriate health care, both within existing service systems and also through specialised services where needed, and
(iii) improve health communication, health information and health literacy for people from culturally and linguistically diverse communities, and of migrant, refugee and asylum seeker background.
Question agreed to.
by leave—I move:
That general business notice of motion No. 751standing my name, relating to the beef industry, be postponed until 10 August 2015.
Question agreed to.
I move:
That the Senate—
(a) does not accept the claim of public interest immunity made by the Assistant Minister for Immigration and Border Protection in failing to provide the documents that were ordered by the Senate on 16 June 2015, namely, all documents relating to the payment of money to turn back or take back vessels bound for Australia or New Zealand, and
(b) resolves that consideration of any message from the House of Representatives transmitting legislation relating to immigration or citizenship, and any government business notice for the introduction of a bill relating to immigration or citizenship be listed for consideration on the next sitting day after the Assistant Minister for Immigration and Border Protection has tabled the documents.
by leave—I move:
That paragraph (b) be removed from Senator Hanson-Young's motion.
Amendment agreed to.
The question is that the motion moved by Senator Hanson-Young, as amended by Senator Moore, be agreed to.
I seek leave to make a short statement.
Leave is granted for one minute.
Mr President, I want to make it clear that the Australian Greens are very disappointed that the chamber has not been able to send a clearer and stronger signal to the government. This is a situation where the government has absolutely refused to come clean on bribing people smugglers and it is behaving in an incredibly arrogant manner. I am glad to see the motion was passed, but, honestly, it would have been good if the Labor Party had been able to be a bit stronger on this. The Labor Party, of course, got themselves into a situation late last week where they did not know whether they were Arthur or Martha on this issue. Here we are, the Greens and the crossbenchers, putting the pressure on the government once again and being the true opposition.
I move:
That the Senate—
(a) notes that a Queensland man has been caught with more than 3 000 shark fins, likely destined for the black market, and that we do not know the origin of the shark fins or how they were caught;
(b) acknowledges that the high prices that shark fins fetch plays a significant role in encouraging illegal fishing and import in Australia; and
(c) calls on the Government to:
(i) ban the possession, sale and/or trade of imported shark fin in Australia, and
(ii) appoint a working group to determine how to implement this policy.
Question negatived.
A letter has been received from Senator Moore:
Pursuant to standing order 75, I propose that the following matter of public importance be submitted to the Senate for discussion:
"The Abbott Government's plan to abolish universal access to free public education."
Is the proposal supported?
More than the number of senators required by the standing orders having risen in their places—
I understand that informal arrangements have been made to allocate specific 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.
I rise today to speak about the Abbott government's plan to abolish universal access to free public education. Specifically, a leaked copy of the federation green paper shows the Abbott government's plan to cut all Commonwealth funding to schools, means-test public education and force the re-introduction of fees for public school students. This is a government which is arrogantly out of touch. This is a government which is failing the Australian people at a time when we should be investing more money in education, but what do we see from this government? It wants to deregulate the universities; it wants to stop anyone who does not have a large credit card from going to university; and now it wants to stop free education in this country. It is absolutely outrageous.
The government is also considering incomprehensible damage to Australia's education system. We all know, as do the Australian people, that before the election there were a number of commitments and promises made by this government, and one of those notably was that there would be no cuts to education. Another promise was a unity ticket on schools—a unity ticket on the Gonski reforms. But what have we seen? We have seen the exact opposite from those in government. There will be a massive increase in fees for children going into the public education system and there will be changes to non-government schools' funding as well. Alongside these disappointing and highly disturbing revelations today, we have seen $30 billion cut from our classrooms over the next decade—which is the biggest cut ever made to education in this country—and that, Senators, is nothing to be proud of. We have also seen the failure to deliver the Gonski agreements, which directly hit students that need the most support in our schools. Obviously not satisfied with abandoning Gonski and cutting $30 billion from education last year, Mr Abbott and his team are setting a new target, which is to attack and cut funding to public schools and to end the provision of free schooling altogether.
This is a disappointing and disturbing revelation, and it shows that the $30 billion cut in last year's budget was just the beginning. Even more disturbing is that we will lose the ability to meet the economic challenges this country faces. As I have said, this is a time when we should be putting more money into education and we should be ensuring that we have better trained teachers and that all parents in this country have the ability to send their children to the world's best schools. It is very clear that the Abbott government does not value public education. We on this side have always known that, and the Australian people have known that, but they were misguided and lied to by those opposite at the last election when they were told there would be no cuts to education—just as they were told there would be no changes to the pension. What have we seen? Nothing but borne-out lies from those opposite. Every Australian child has a fundamental right to expect to have access to the world's best education system. We are a rich country; we can afford to put more money into education. The Australian people are paying the price of the betrayal of Mr Abbott and his government. Mr Abbott cannot be allowed to get away with abandoning this funding for public education. He intends to charge hundreds of dollars to thousands of parents to send their children to the public schools in this country.
This government claims they have had a proper discussion with the states. But this has nothing to do with improving education outcomes for children and everything to do with cost-shifting and privatisation. We know the more pressure this government can put onto states by cutting education and cutting health the more it will force them to have to look at the GST and increasing that. We know that what this government cannot do through the front door they will do, by whatever means they can, through the back door.
To have a world-class education system in this country, we needed this incoming government to live up to the commitment that they gave by fully rolling out the Gonski initiatives. That was the only way we were going to have the best outcomes for every Australian child. Every child, no matter what their education ability, needs to be able to reach their highest academic achievement. But they also need to have access to drama, to sport, to music, to have those extra teachers in the classrooms, to have smaller classrooms. I really do not think that that is too much to ask from this government. But, as we have seen in so many other policy areas, we know that Mr Abbott still resides in the 1960s—and that is where he is taking education in this country.
We have fought Mr Abbott and his government on a whole range of things since we have been in opposition. We did it when he wanted to cut the pension, which would have cost Australian pensioners $80 a week. We stood up with the Australian people—and we can do the same here and now. I know that Labor will always stand up for public education. We will always stand up to ensure every Australian child has the world's best education system in this country. I also believe that the Australian community will send a very strong message to this government that they will not stand by and see this government attack public education in this country.
We know that there are some students who struggle to meet their academic achievements. What they need is more help and assistance. They need more highly skilled teachers. They need to have teachers' aides. They need more money put into education so that they can reach their personal achievements and their personal ambitions of having the best education they can. We know that there still needs to be more money put into numeracy and literacy in this country. We also know the benefits that come from participating in sport and having access to music in our education system. We always know that students do much better with smaller class sizes.
I, for one, and those of us in opposition will never trust Mr Abbott and Mr Pyne to deliver a good education system in this country. It does not matter whether you are talking about education and cutting funds to the states, or whether you are talking about deregulating the universities. We know those opposite have always believed—it is in their DNA—that you should not be able to go on to university if you cannot afford to pay your way. They want to see us go down the path of the American system.
In my home state of Tasmania, where we have a very low retention rate when it comes to tertiary education, we should be doing more. Having met with the vice-chancellor of the University of Tasmania very recently, it was reaffirmed to me—and it is something even I know—that instilling the value of education and ensuring that you have as many students as possible going on to tertiary education starts in primary school and is then continued on in the high school years. That is the way that we are going to get more Tasmanians going on to tertiary education.
This quite clearly is another election promise that has been broken. This is an election promise that has been broken just as the one was with the attack on pensions in this country. It is fundamentally every Australian's right to have the best education possible.
Senator Bushby interjecting—
We also know—and we have the interjections from the other side—that you cannot trust anything they say. Even Mr Abbott said himself: if it is written down, then you can believe it. We know that you cannot believe anything this government says about the election commitments that they gave on the eve of the election—that there would be no change and no cut to education and no change to pensions. They have done exactly the opposite to that.
I, along with my colleagues, will fight this every step of the way to the next election. The Australian people know, because they know our reputation on this. They know those in political parties like the Australian Labor Party will always put education first. They will always put their money on a Labor government delivering better outcomes in education.
Senator Bushby interjecting—
I am really disappointed with Senator Bushby from Tasmania. He should be working with us to ensure that every Tasmanian has the best opportunities to achieve their personal ambitions. (Time expired)
The old saying goes: lies, damned lies and statistics. But, perhaps, the saying should be updated to: lies, dammed lies and speeches from Australian Labor Party senators. What we have just heard, and it has continued throughout the day, is a hysterical reaction from the Labor Party—a reaction that is completely based on mistruth.
I think it is important, in relation to this topic, that we do try to have a sensible discussion. Certainly the government is trying to have a sensible discussion with the Australian states and territories about how the federation operates, about what our responsibilities are as a Commonwealth and what the responsibilities of the states and territories are, and how we make sure that we eliminate waste and duplication and get the best possible results in terms of the delivery of services right across all of the areas of government responsibility, including, and especially, good educational outcomes for students, and school students in particular.
Let us have a look at the discussion paper that has triggered this wave of outrage from those opposite. I will give you a few quotes from it. Firstly it says: 'The Constitution by virtue of section 51(xxiiiA) and section 96 has allowed the Commonwealth to increase markedly its involvement in education which is generally regarded as a state and territory responsibility.' It goes on to say:
… the current arrangements have … undoubtedly blurred the lines of accountability to the general public …
As result it is not always clear who ultimately is responsible for the delivery of high-quality services. This shared space on policy and funding has also led to duplication, waste and poor targeting of investment and effort. I would hope that those opposite, that anybody who cares about the future education of our schoolchildren and the management of our school and educational system, would want to eliminate duplication and waste and would want to make sure that investment and effort was well targeted to get the best possible outcome for students. This of course is framed as part of a broader discussion, though. This is not just a review in school funding; this is a review of the entire federation and how it operates. It is having a look at the health sector, it is having a look at the education sector, it is having a look at revenue—how governments have the revenue to access funding for the future.
Through all of that, it is trying to find a way to ensure services are delivered in the most efficient and effective manner possible without having that waste and duplication that we have seen. The problem with this level of waste and duplication and this lack of clear accountability for who is responsible—because currently you have every level of government tipping funding in different and disparate ways to every different level of education—is that nobody ends up being held effectively to account for outcomes. What we have seen, as this discussion paper goes on to say, is:
Spending by all Australian governments grew by 37 per cent, in real terms, in the ten years between 2002-03 and 2012-13.
But we now have fewer higher achievers and more low performers than a decade ago and average scores have declined. We are now equal 17th in mathematics; we were equal second. We are equal eighth science; we were equal third. And we are equal 10th in reading; we were equal second. So, while how much funding schools get is important, it is not the silver bullet to achieve better results. How it is spent matters more.
Senator Wright interjecting—
I will happily take that interjection, Senator Wright—and where it is spent, indeed. So, as a federal government, we have tried to make sure that a lot of our education reforms are focused on the 'how it is spent' question—how it is spent to make sure that we do deliver the appropriate policies that increase school autonomy, ensure that our curriculum is robust and relevant, promote parental engagement in children's learning and improve the quality of teaching; things the Commonwealth can clearly do. We are providing record funding—$69.5 billion to schools over the next four years. So the funding is there in record levels, but we are trying to tackle the policy measures that can help to ensure it is spent in ways that get better outcomes and redress the decline in our performance over the last decade.
We also want to make sure that the funding is used as wisely, effectively and efficiently as possible. That is why we have in this discussion paper, as it is across all elements of the Federation, canvassed the whole range of options that are available. Option 1 that is canvassed here is that states and territories become fully responsible for all schools. Of course, if that were to happen—I hear the hysterical reaction already—you would need to make sure that states and territories had the funding streams to be able to fund all schools, that they actually had the revenue to make up for where the Commonwealth was stepping back, and that of course would be part of any structured arrangement around Federation reform. Option 2 is that states and territories are responsible for funding government schools and the Commonwealth is responsible for funding non-government schools. That is essentially a finessing of current arrangements where the states and territories take the bulk of responsibility for funding the government school sector and the Commonwealth, as it has for decades, takes the bulk of responsibility for funding non-government schools. Option 3 is that there is reduced Commonwealth involvement in school programs—essentially, a level of maintaining the status quo in terms of some of the funding but with less Commonwealth interference in how schools are operated. Option 4 is that the Commonwealth is the dominant public funder of all schools on an equal and consistent basis. Option 4 would be saying that the Commonwealth would take a much greater role in terms of the amount of funding it would provide to education. Of course, the Commonwealth would need to consider how and where it got that revenue from and how it delivered this. But you can see from those four options that the whole spectrum of scenarios is there under consideration, yet we have an opposition—and, frankly, it includes the Greens and the unions on this topic—that is hell-bent on a misleading campaign suggesting that this is part of some strategy for the government to cut school spending.
Absolutely.
Senator Wright says, 'Absolutely. There we go. Mr Acting Deputy President Whish-Wilson, through you: Senator Wright, we will only achieve any reform of the Federation if the states and territories agree. That is why they have been involved in the development of this discussion paper, that is why the Prime Minister is sitting down with state and territory leaders in July, and of course that is why I am pleased to say that the states and territories are being far more sensible about this than any of those opposite, because they know that it makes sense to try to get clearer lines of accountability if it is possible. The South Australian Labor Premier has not endorsed Senator Polley's hysteria, nor Senator Wright's hysteria, nor the hysteria of many others in this space. South Australian Labor Premier, Jay Weatherill, has rightly said:
… it's only a discussion paper.
We've been asking them—
'them' being the Commonwealth—
to canvas the broader range of options …
So we have canvassed the broadest possible range of options. Premier Weatherill went on to say:
There's a broad debate going on about Commonwealth/state relations, which is a good thing.
And it is a good thing to have this debate and it is to the shame of all of those opposite that they do not want to have a sensible debate about this, that they want to turn it into a scare campaign and that they do not seem to care about whether or not funding going to the school system is wasted. They would rather run a scare campaign. They do not care about the fact that our educational standards are slipping because of this wastage, because of these inefficiencies. They want to run a scare campaign. We will not accept a scare campaign. We have been crystal clear today to make sure that everybody understands that there are no plans from this government to reduce support to schools. That is why we are providing record funding. We have no intention of charging people to attend and access free public education. But we do intend to have a proper discussion with the states and territories to see whether the Commonwealth can actually manage to operate and run the education system, and the schooling system, and the funding thereof, more efficiently—in partnership with the states and territories. That is what this is about—trying to get better outcomes for Australian taxpayers and for state taxpayers—
Senator Wright interjecting—
but more importantly, Senator Wright, for students and parents, and to make sure that they are getting the best possible resources. It is to the shame of all those opposite that all they are interested in is a scare campaign on this—rather than achieving the best possible outcomes for Australian students, which is what this government wants to deliver.
I rise to speak on the Abbott government's plans to abolish universal access to free public education, as revealed in the leaked chapter of the Reform of Federation green paper today, but first—
Complete bullshit! What rubbish! Could you just not start with an outright lie?
First, let me go to Senator Birmingham's discussion and contribution, because 'lies, damned lies, and statistics' is what it is all about today. We had Senator Birmingham in question time again repeating Minister Pyne's oft-repeated claim that school funding has increased by 40 per cent in the last 10 years. I interrogated this claim in Senate estimates recently, and the Associate Secretary of the Department of Education and Training, Tony Cook, said that the source of that claim was table 4A.7 in the Report on government services 2015 published by the Productivity Commission. Don't leave, Senator Birmingham. You might want to correct what you say publicly after you hear this. That table shows an increase of real funding—that is, adjusted for inflation—of 21.7 per cent—about half of that particular claim—between 2003 and 2012. That is half the figure claimed by Pyne. But let us unpack that a little bit more. That figure of 21.7 per cent was for aggregate funding for all schools—public and private—and made no allowance for increasing student enrolments. Surprise, surprise—with more students you have to spend more. And in fact, a later table in that report—table 4A.17—shows that the figure for real funding per student, adjusted for inflation, was only 12.7 per cent—about a third of the figure that Minister Pyne and Senator Birmingham keep claiming.
Let me come back to the debate. Sometimes in debates like this it is hard to find the right words to say, because it is hard to find another way to communicate how awful and how brutally cruel this government is, and how low it is willing to go. As one of my colleagues said to me this morning, after we had all woken up to hear that the government was floating a proposal from the so-called Centre for Independent Studies—a right-wing think tank—that would means-test wealthier parents if they wanted to support the public education system: 'just when you think this government can't get any worse, they do.' It can be hard to find words to defend what should be, in Australia, an inviolable right. It is hard to believe that any government would canvass, even for a second, such a radical proposal—to end Australia's proud history of universal access to free public education. Australia has been built on free, compulsory and secular public education. It is the foundation of our country and has been the envy of other nations for decades. This should not and must not be eroded.
Minister Pyne has now tweeted his opposition to means-testing this morning—after having floated it. This is the same man, mind you, who looked us in the eye and promised us a unity ticket on Gonski. Why would we trust him on anything? We have had the Prime Minister out there too, keeping this idea ticking along, and backbenchers, like Andrew Laming, tweeting support for a price signal on education—a signal to send wealthier parents away from the public education system into private education, perhaps. Simply and sadly, we cannot trust this government. And it is clear why: it is not just about flagrantly broken promises; it is about ideology. We have Minister Pyne very clearly on the record saying that this government has an emotional commitment to private schools. We have the Prime Minister saying: 'We have a particular responsibility for non-government schooling that we don't have for government schooling.' This government seems to have forgotten the most central platform for its existence, and it will do so at its own peril. It is here to govern for all Australians—not just those who are more wealthy, not just those who are more privileged, but all Australians. The government must not abandon the two million students who attend public school.
Public education is a right. Private schooling is a choice. Yet at every turn, as with every policy issue that arises, this government has shown they are more interested in defending the interests of the wealthy and the privileged. Their failure to implement a true needs-based and sector-blind funding system, despite their promises to do so, will further entrench privilege and entrench advantage in our schools. Why is this government afraid of real merit—real equality? What do they have to fear from universal, quality public education? The federation paper actually asks all the wrong questions. No wonder it is coming up with the wrong answers! The Abbott government are actually looking for a way out of being blamed for declining education standards, rather than looking at what they can do to make sure every Australian school is a great school. It is a fundamental right of every Australian to be educated in public schools free of charge. (Time expired)
I rise to speak on the MPI this afternoon around the plans that we have seen outlined in papers today to abolish universal access to free public education. I think we all got a shock last night—those of us who were catching up on the news—to see the stories come in around the leaked document—the green paper for the reform of federation—which outlined some pretty outrageous options for the future of education in this country. Those options included: giving states and territories full responsibility for all schools; making states and territories fully responsible for funding public schools, while the federal government funds non-government schools; reducing the Commonwealth involvement in schools; making the federal government the dominant funder of all schools; or withdrawing the federal government entirely from the funding of public education. Anyone who has watched the education funding debate since education funding actually started being a negotiation between the states, territories and the Commonwealth back in the 1960s, would have seen how fraught the area of education funding is, and how difficult it is to resolve issues of who funds what and how much to fund it. But I think the one thing that most Australians agree on is that there is a role for the national government to be involved in the funding of all schools for every child in Australia.
The option that was outlined as one of the ideas in this green paper was that means testing be introduced. I see that in question time today the Prime Minister came out and said that he does not support that, after being a little evasive on the subject this morning. The education minister, Christopher Pyne, came and said that he did not support it, and I note that the Prime Minister has now backed him. I think everyone in this chamber would support the clarification that has been provided today, but, that one issue aside, it would seem at the moment that one of the underlying themes of the Federation reform process is that the Commonwealth removes itself—whether in a funding role or in any kind of responsible role—from the areas of education and health. Indeed, I touched on this in my first speech, which I made last week, when I said that Federation reform should not be used as a way of prosecuting one government's political agenda over others and forcing unreasonable expectations or responsibilities on the states and territories and the smaller governments, which do not have the revenue-raising capacity that the national government does.
Indeed, having been involved in some of the early discussions around Federation reform, I fear that that is exactly what we are seeing happen now. We are seeing a Prime Minister who has a fixed view, and his view is that the Commonwealth should, to use his words, 'get out of education and get out of health,' and leave it to the states and territories. For one, I think that if you ask the average person in the street, they would believe that there is a role for the national government in the areas of health and education, they would expect the national government to be there, and they would expect that the Commonwealth cannot, in a sense, abrogate its responsibility to the citizenry of this country by removing itself from two of the most important areas that any government is involved in.
I do note that the green papers on education, health and tax reform will be released in due time. I am not saying there is no opportunity for Federation reform—I think that there is. But I do not think that it is a reform that is going to be progressed with leaks to the paper and federal ministers ruling the most outrageous initiatives out, but leaving some of the still very significant changes on the table to be agitated over prior to anybody getting the details.
The first budget of this government, the 2014-15 budget, was delivered when I was still Chief Minister of the ACT. I am a previous education minister as well, so I do have a level of detailed knowledge about the funding of the education system and responsibilities between states, territories and the Commonwealth. What we saw in that 2014-15 budget, after being promised no cuts to education in the 2013 campaign, was the removal of $80 billion out of agreements that had been signed in good faith by governments. I signed the paperwork. I believed that that drew the Commonwealth to the table to provide a funding commitment to schools in the ACT for a six-year period. One of the first financial decisions taken by this government was to remove it—$50 billion in health and $30 billion in education.
I attended—I think a week or so after that budget came down—a meeting of all of the first ministers in Australia, bar WA. It did unite across party divides, as all first ministers—apart from Premier Barnett—came together to try to understand what had just happened to the agreements, which we had also provided money for, in my previous role, to bring to the table; to try to understand what was going to happen into those out years; and to make a commitment that we would not let those cuts stand. However, the 2015-16 budget has been handed down and we see that, as those years come into the budget estimates, those cuts remain.
One of the most important things around the agreements reached between state and territory governments and the Commonwealth government—the truly revolutionary aspect of what Prime Minister Gillard actually delivered through those agreements—was the uniting of the education sector on the best way to fund the system, regardless of what system or jurisdiction a child was in, in terms of school make-up—private, independent, Catholic systemic, Catholic congregational or public schools. We were able, through that negotiation process, to unite the sector in what has been, in my experience, a very difficult area to reach agreement on.
We had the advocacy bodies for independent schools, for the Catholic schools, the Australian Education Union and the stakeholders for public schools all coming together. It was not only about funding—and this is something that is always forgotten. It was also around quality teaching, and it was going to the issues that Senator Birmingham outlined around value for the extra money put in; this was recognised in those agreements. It was also about delivering better student outcomes, giving flexibility for principals to make decisions in their schools, and transparency and accountability about where that money goes and what it is being used for. Most of all, it was about a needs based funding system for children so that—regardless of what school your child attends and wherever they attend in Australia—your child gets the level of resourcing that they need to get a great education. That was the true success of that agreement. That is what the state and territory first ministers signed up to, and that is what the Commonwealth said that they would deliver upon. That was removed unilaterally. In fact, we had a COAG meeting a week or two before the 2014-15 budget was handed down, and not one word was said about this massive change to agreements that had just taken two years to negotiate
That is the form. That is where we start. And now, not only do we not have Gonski or the National Education Reform Agreements, which provided a level of funding and some changes across the system that, at that time, we were all committed to implementing, but when we see the green paper it is supposedly going to come out and say, 'You are not even going to have that. We are actually going to look at removing ourselves entirely from this space and leaving it up to the states and territories.' I note the Prime Minister said today that states and territories run the system. I can tell you, if you get Commonwealth funding in those schools it comes with strings attached. You get told how that money is to be spent. If you do not spend it that way you do not get it. So it is not entirely true that the states and territories have all the say. But I look forward to the green paper being released eventually. I look forward to the debate, but I think we should all go in with our eyes open to the fact that there is an agenda that is being pursued through this process that cannot be supported. It cannot be supported in the interests of children's education in this country.
I, like everybody in this debate, support 100 per cent the right of every Australian child to be educated in an excellent school. For the one million children who are educated outside capital cities in this country, 660,000 of them, the majority of them, are in state schools. They are located right around regional Australia. My communities, my party, and my own family is invested in ensuring that there is excellence in state education right across this country. My own experience as a university lecturer within the education system gave me the privilege of training so many of the young teachers who are going to head out into state schools. And I want to confess that, in my own experience as a schoolteacher, I never taught at a grammar school. I only taught at state schools, because I believe that every child should have access to excellence in education.
Our government is the best friend the state system has ever had. We have had record funding across state school systems, and we have done more than that. We have not just thrown money, because we know that just throwing money will not make a difference and will not stop the decline in standards that is occurring despite filling up the buckets of money—it is how we target it. It is also different policy settings, or whether it is the national curriculum or the minister's TEMAG initiatives, which are actually going to ensure that there are quality teachers in our state schools and that quality teaching occurs within our state schools. If you want to ensure that every child has the best chance to succeed and the best chance for quality outcomes, the one thing this government can control—we cannot control the type of family they grow up in or where they grow up—is the quality of the teaching they receive, and not only in the Catholic and independent schools, which have so much more freedom and so much more autonomy on how they staff their schools than state school systems do. What we, the Commonwealth government, can do is ensure that our public purse is significantly subsidising the tertiary education of every teacher who is graduating from our universities, and that every teacher who is in front of an Australian child, whether in the state school system or in Catholic or independent schools, is of high quality, because that is the thing that we know will make the biggest difference.
But it is only the ALP and the Greens who will actually come in here and attack the fact that there is a range of ideas and options out there, that there is not a one-size-fits-all policy solution to this very complex and vexed issue of how we actually have a sustainable federation. We saw their approach to a tax review: we will have a tax review, but we will keep the most contentious parts of our tax system out of that public conversation. And so when you see the Henry tax paper, it neglected to actually deal with the complexities of the tax system as a whole. We are not afraid of ideas. We are not afraid of options. Just because they are on the table does not mean they are going to be taken up. But to actually restrict public debate before you have even started to have it really says more about you than it does about us. We respect diversity and we respect choice.
We welcome the initiative and we welcome and support an incredible, excellent public education system. What we also want to do is give freedom to our principals to hire and fire, to ensure that those quality teachers are actually in front of the classrooms. We want to ensure that public schools have the independence and autonomy that Catholic and private schools enjoy. I think if you want to talk about excellence in public schools we really need to look no further than my home state of Victoria, where you see, for instance, Balwyn High School—a fantastic public school. House prices just within that catchment area have increased by $250,000. There is an assumption that if you are a wealthy person you are going to head off to grammar and pay upwards of 25 grand a year per child to have an education, but why would you do that? There are a lot of parents in Victoria who are choosing to send their children to excellent public schools, and I applaud them for that. And they are prepared to pay the price for that. I look at Mac.Rob, a high-performing public school in Victoria, and at Melbourne High and Nossal High. Excellence in public education is something that we should all be championing, and I thank the minister for his strong support of state school systems.
We have heard today about issues around needs-based funding models. Even Senator Gallagher said, 'We do not have the Gonski model.' The reality is we never had Gonski. We never had the model envisaged by Gonski, because the political reality and the political mettle of the leadership of the Labor Party at that time saw us end up with 27 different agreements around what constituted a needs-based funding model when it came to public education in this country. So for those on the other side to somehow, once again, try to steal the rhetoric and the public debate and conversations, and somehow reframe reality now, is absolutely abhorrent. We never had the Gonski model. It was 27 funding agreements because people would rather play politics with public education.
Senator Wright interjecting—
Through you, Mr Acting Deputy President, Senator Wright: rather than actually focus on what is best for students, what is best for schools, the Labor Party in partnership—hand in glove—with the Greens went to the last election desperate for deals with the states and ended up making promises they could never keep: that no school would miss out; that no student would miss out.
When you put parameters on this sort of needs based funding model, I am sorry: it is absolutely unachievable. What we saw was an absolute dog's breakfast. This government came to power and has actually given more money to Queensland, to WA—money that you ripped out of those schools, that you were not going to provide to those schools in desperate need in those states. I find it a bit rich at this end of the debate.
How do we move forward? We all spruik how wonderful the Finnish system is, and indeed it has a lot of good things going for it. We need to get serious in this place and stop being political and partisan about school funding and have a bipartisan approach which puts students, teachers, school communities and parents at the forefront of any policy discussion. The reality is: the Commonwealth government provides about 15.6 per cent of the funding for state schools.
So, Senator Wright, you might actually be in the wrong place. If you care so much: run for state parliament, get the balance of power and make all your dreams come true.
Governments should ensure that a great education is available to every poor kid in Australia. The current approach is not necessarily the best way of achieving this. So I welcome the news today that the government has prepared an open-minded discussion paper on school funding and is consulting with the states and territories. I find it disconcerting that certain parties respond to this news by immediately asserting their support for the status quo and attacking anyone who dares to consider alternatives.
The Liberal Democrats believe the Commonwealth government should play no role in school funding. The Commonwealth has no constitutional responsibility in this area, runs no schools and has no monopoly on the raising of taxes. But, if the Commonwealth government is to play a role in school funding, we believe funding should be provided according to the circumstances of the children and parents. It should not be provided according to who owns the school.
Don't be fooled by the Gonski cheer squad: current funding arrangements do not provide funding according to the circumstances of the children and parents. A poor child in a government-run school gets the most funding: more than a poor child in a church-run school, which is more than a poor child in a privately-run school. This results from two levels of government working at cross-purposes, from generous grandfathering arrangements for
church-run schools and Gonski's intentional discrimination between government-run and non-government-run schools. Those defending the status quo are clearly more interested in point-scoring than in the welfare of our poorest kids.
I rise—sadly—in support of this motion that has been put forward by Senator Claire Moore. It will be Labor that stands up for education and access to education in an equitable way for all Australians over and over and over. It was on Labor's watch that the most significant analysis of student success in schools was undertaken and it resulted in the Gonski review, which indicated very clearly after significant research that the way in which we could invest in the future of our young people is to make sure they get a fair crack at a decent education.
The last time I looked when I was heading off overseas, I had an Australian passport, not a passport for New South Wales—nor, as far as I know, Deputy President Whish-Wilson, as a proud Tasmanian, for Tasmania. We belong to a country which requires all of us to have access to a great education. It should not be so different from state to state, which is one of the problems we see with the American model.
Today's article by Matthew Knott in both The Age and the Canberra Times bells the cat on what this government really want to do, and I have heard it over and over and over at Senate estimates—an abrogation of responsibility from the federal government of key areas, particularly health and education. I have heard minister after minister stand there and actually proudly declare that it is rightly the responsibility of the state, completely abrogating any sense of national responsibility for the education of our nation into the future.
We live in a global economy. We have got a country that is diverse. We do not need to fracture it anymore by creating different levels of education across the states. With regard to the state of New South Wales, it was a bit of a shock to me to have heard in question time today claims that the states were responsible for this green paper. Is it a draft? Is it the real one that went out? But we heard today, clearly, that the states were involved in drafting it. I don't think anyone from New South Wales was involved in drafting it, because in the Financial Review today an article by Geoff Winestock said:
Ms Berejiklian called on the Abbott government to reverse a decision in last year's budget to slash payments to the state for education and health, which will start to take effect by the end of the current forecast period.
Ms Berejiklian said:
The changes to health and education funding the federal government announced last year are not sustainable, and we will be fighting for the people of NSW to ensure this State gets its fair share both now, and into the future.
If that is the case, there is no way they could have participated in the green paper, because that is the complete opposite of what this government is telling us here today.
Mr Piccoli is on record as saying, if the Commonwealth funding, the Gonski agreed funding—and it is agreed; it was agreed and they are still fighting for it for the children of New South Wales—is threatened:
would be threatened.
threatened.
threatened.
threatened.
The funding impact on the state of New South Wales is a loss of $2.8 billion. For Victoria, it is $2.1 billion; for Queensland, $2 billion; Western Australia, $570 million; South Australia, $450 million; Tasmania, $200 million; the ACT, $30 million; the Northern Territory, around $200 million; and, overall, for Australia, $8.3 billion. This is what is at stake—money of that scale.
I can tell you, as a former teacher: the resources that we need, as teachers—as professionals who can diagnose students' learning abilities and needs—are so often not available. Currently, as to the disadvantage of teachers who are teaching in remote settings and teachers who are teaching young Aboriginal kids or children from a background where the English is not their first language, Gonski proved once and for all that those children need particular additional resources—and teachers know it. There are great teachers out there already doing the very best that they can with the resources that they have, but, for many teachers, it is an insult to go to schools day after day and not have what they need. (Time expired)
What a refreshing change it is that we have a federal government that actually wants to consult and negotiate with states and territories. I think back immediately to the Rudd prime ministership, as to hospital funding, in which he put a gun to the head of all of the states and territories and said: 'In return for some GST money, I will do something; if you do not do it—if you do not sign up—that is the end of you.' Thank the Lord there was one coalition Premier left in this country at the time, in Colin Barnett, who said to Mr Rudd: 'No you won't. The management of hospitals actually resides with the states. And thank you very much for your measly offer!'
But what do we see today? Again, what an incredible scenario, as presented—that the federal government would want to sit down with the states and territories, who have responsibility for the delivery of education in this country, and say to them: 'How can we work better? How can we actually reduce duplication? Is it necessary that we have in excess of 4,000 staff in the federal department of education when they do not actually teach a single child? Is that the best way to expend the taxpayers' money? Is that the best value for children in this country?' It may be or it may not be, but have a look at the manner in which this process is being undertaken.
We heard from Senator Birmingham this afternoon of the South Australian Labor Premier Mr Weatherill complimenting the government and the minister, Minister Pyne, and saying, 'What a refreshing idea it is that we would go through this process.' But I again remind those who might be listening that the provision of education services and delivery in this country, under the Constitution, is for the states.
I know that Senator Cash will be very interested in the comments recently of our state minister for education, Peter Collier, when he made these observations, not 72 hours ago, that, in our state—because Western Australia genuinely believes in provision of education delivery—these are the stats: we have the highest per-capita resourced schools in the nation; our teachers are the best-paid in the nation, and, according to Peter Collier, that is by a country mile.
But let us see the outcome of this, if we can. The trend of reducing attendances in our public state schools in Western Australia has been reversed, and we are now seeing a net increase in the attendance in our public schools. Why do you see that circumstance? There are three words that explain it, and they are: Independent Public Schools. Of the 799 public schools in Western Australia, 441 or 55 per cent of them are now independent public schools and another 92 have applied to join. What are we seeing? We are seeing principals with autonomy in terms of decision making, school communities very much more involved in the management of their school, and principals and their staff and the school community having the capacity to say, 'This is where we want to direct our resources; this is where our particular school needs the educational opportunities,' whether in disability or languages, and, of course, having the capacity to select their staff—to advertise for the teachers that they want. That is what we are seeing in our home state of Western Australia.
In response to the area we speak of, Mr Collier has already come out and said: 'Education is a state based issue; we won't be charging children or their parents to be going to school in the state schools.' So there is the excellence of a system led by a Premier and a minister who put education first.
Indeed, if Senator O'Neill has the long list of complaints and issues that she has got, then she should turn to the state authorities. They have ripped enough of Western Australia's GST money out; they should have sufficient funds to put into education.
But I go to the state of Queensland and to some figures given to me just recently in this debate, and those are on Queensland year 9 NAPLAN tests. And what do we see, Senator O'Sullivan—through you, Mr Acting Deputy President Whish-Wilson? We actually see, at the median SES level, no difference in the NAPLAN performance between state schools, Catholic schools and independent schools. So there are the circumstances.
To return to Western Australia again—because Western Australia and the Territory missed out badly in the last round of negotiations under the previous governments—these are the points I need to make. There are no cuts to Commonwealth government funding, and $69½ billion is to be expended over the forward estimates—and this includes funding for the Indigenous boarding initiative. How wonderful is that? We spoke for years in this place about the limited opportunities being offered through the independent system to take young Aboriginal people from the remote and rural areas and bring them down to the boarding schools—certainly, in my own home state, and, I know, in the other states. Now we have got sufficient funding to expand that program so that these young Aboriginal and Torres Strait Islander children can get a full education, and the statistics that we saw on the success of that program previously, are of success at year 12 level—the level of going on to higher studies or to education and employment.
The Abbott coalition government—far from all the gloom and doom we heard from Senator O'Neill in this place a few minutes ago—has restored the $1.2 billion that the previous Labor government took out of school funding in the forward estimates. But it is better in our state, which, as Senator Cash well knows, missed out last time. You, Senator Cash—through you, Acting Deputy President—will be interested in these figures. The total Commonwealth funding to government schools in Western Australia will grow by $1.9 billion—a 36 per cent increase from 2014 up to 2018-19. For non-government schools, it will grow by $2.2 billion by 2018, a 23.4 per cent increase. Across the board, it is a 28 per cent increase. No-one who can stand up here and say to me that this Commonwealth government is not totally focused on those three areas. Teacher quality, school autonomy, engaging parents in education and strengthening the curriculum are the four pillars that are so essential in this debate.
I rise to participate in the matter of public importance discussion titled 'The Abbott government's plan to abolish universal access to free public education'. I congratulate Senator Moore for raising this matter. Despite the education minister rejecting the proposal in the government discussion paper to make wealthy parents pay to send their children to public school, it is clear that this option floated in the federal government discussion paper, which considers a radical overhaul of the nation's education system, is on Minister Pyne's and Prime Minister Abbott's list of things to do. This plan to make wealthy parents pay to send their children to public school's is just another attack on a fundamental Australian social right, namely, an attack on access to free public education. It goes hand in hand with the ideological political attack the Liberals have carried out on universal access to public health care and access that young people have to higher education.
While Minister Pyne is on social media saying his government does not and will not support the means test for public education, we are smart enough not to trust a word that comes out of his mouth. This is the same man who tried to make our young people pay $100,000 for their university degrees when there was not one word of warning before the last election. Mr Pyne's leader Mr Abbott is the Prime Minister who promised there would be no cuts to education before the last election. But in his first budget he announced cuts of $80 billion to health and education over the next decade, including a $5 billion—20 per cent—cut to university funding and deregulation of uni fees and schools funding. That is in addition to the Liberal Party's promise not to cut the budgets of health, ABC, SBS and pensioners entitlements.
The public education system in Tasmania is struggling, despite the fine effort of teachers, teachers aides, school principals, parents and parent helpers. The last thing Tasmanians need to hear in the media is the Prime Minister sidestep the issue of means testing. The Prime Minister is reported by the ABC as saying:
I think it's good that some of the states and territories at least are thinking creatively about how they can responsibly fund their operations …
Given the Abbott government's blatant disregard for the truth and lack of integrity, if means testing of parents for public schools is in a Liberal discussion paper now, you can almost be guaranteed, because of past behaviour, that should the Liberals be returned as a government after the next federal election, means testing for public schools will be introduced. There is absolutely no doubt about that.
Order! The time for the discussion has expired.
by leave—I move:
Abbott Government ' s Budget Cuts—Select Committee—
Appointed—Participating members: Senators Johnston, Lindgren and Sinodinos
Economics Legislation and References Committees—
Appointed—Participating member: Senator Lindgren
Education and Employment Legislation and References Committees—
Appointed—Participating member: Senator Lindgren
Environment and Communications Legislation and References Committees—
Appointed—Participating member: Senator Lindgren
Finance and Public Administration Legislation and References Committees—
Appointed—Participating member: Senator Lindgren
Foreign Affairs, Defence and Trade Legislation and References Committees—
Appointed—Participating member: Senator Lindgren
Legal and Constitutional Affairs Legislation and References Committees—
Appointed—Participating member: Senator Lindgren
National Broadband Network—Select Committee—
Appointed—Participating members: Senators Johnston, Lindgren and Sinodinos
Recent Allegations relating to Conditions and Circumstances at the Regional Processing Centre in Nauru—Select Committee—
Appointed—Participating members: Senators Johnston, Lindgren and Sinodinos
Rural and Regional Affairs and Transport Legislation and References Committees—
Appointed—Participating member: Senator Lindgren
Wind Turbines—Select Committee—
Appointed—Participating members: Senators Johnston, Lindgren and Sinodinos.
Question agreed to.
I move:
That this bill may proceed without formalities and be now read a first time.
Question agreed to.
Bill read a first time.
I table a revised explanatory memorandum relating to the bill and move:
That this bill be now read a second time.
I seek leave to have the second reading speech incorporated in Hansard.
Leave granted.
The speech read as follows—
SOCIAL SERVICES LEGISLATION AMENDMENT (FAIR AND SUSTAINABLE PENSIONS) BILL 2015
This bill will introduce several 2015 Budget measures improving the fairness and sustainability of the pension system, and reintroduce some measures previously introduced in 2014 bills that are still before the Senate.
For improved fairness and equity, the first of the new Budget measures will make sure a fairer proportion of a superannuant's actual defined benefit income is taken into account when the social security income test is applied. From 1 January 2016, this measure will introduce a 10 per cent cap on the defined benefit income that can be excluded from the social security income test.
A defined benefit income stream is a pension paid from a public sector or other corporate defined benefit superannuation fund, where the pension paid generally reflects years of service and the final salary of the beneficiary. Current arrangements allow some defined benefit superannuants to have a large proportion of their superannuation income excluded from the pension income test.
People receiving Veterans' Affairs pensions will not be affected by this change, and defined benefit income streams paid by military superannuation schemes will be excluded.
From 1 January 2017, the bill will reduce from 26 to six weeks the length of time the Age Pension, and a small number of other payments with unlimited portability, will generally be paid at the basic means-tested rate while the person is outside Australia.
After six weeks, payment will be made on a proportional basis according to the length of the pensioner's Australian working life residence—a concept representing the length of time the person has resided in Australia between age 16 and Age Pension age.
Pensioners overseas on the implementation date will stay under the current 26-week rule until they return to Australia. Subsequent trips will be under the new six-week rule. Those pensioners with 35 years or more of Australian working life residence, and those already exempt from the proportional payment rules—such as some recipients of the Disability Support Pension—will not be affected.
A further measure applying from 1 January 2017 will rebalance the assets test to make it fairer and better targeted, and to help ensure the pension system is sustainable into the future. The changes will:
The purpose of providing tax incentives to encourage people to build up their superannuation is so they can draw down on it in their retirement.
People with higher levels of retirement savings have the capacity to draw down on their assets to support themselves in retirement rather than calling on the taxpayer for support. Those most affected by the changes would only have to draw down a maximum of 1.84 per cent of their assets to make up for the loss of their part pension.
Importantly, pensioners who lose pension entitlement on 1 January 2017 as a result of the changes will be automatically issued with a Commonwealth Seniors Health Card, or a Health Care Card for those under Age Pension age, without the need to meet the usual income requirements. Additionally, veterans whose Service Pension is cancelled under this measure will retain their Veterans' Affairs Gold Card.
This bill also takes the opportunity to reintroduce some measures relevant to pensioners from the 2014 Budget.
The first of these measures is to cease payment of the Seniors Supplement for holders of the Commonwealth Seniors Health Card or the Veterans' Affairs Gold Card. This measure is currently before the Senate in the Social Services and Other Legislation Amendment (Seniors Supplement Cessation) Bill 2014.
In reintroducing this measure, the implementation date will be moved to 20 June 2015 (meaning the last quarterly payment of Seniors Supplement would generally be made on 20 June 2015).
Lastly, the bill reintroduces two measures currently before the Senate in the Social Services and Other Legislation Amendment (2014 Budget Measures No. 4) Bill 2014. These measures are to cease the Pensioner Education Supplement and the Education Entry Payment—with a new start date in each case of 1 January 2016.
Debate adjourned.
Pursuant to order and on behalf of the Chair of the Community Affairs Legislation Committee, I present the report on the provisions of the Social Services Legislation Amendment (Fair and Sustainable Pensions) Bill 2015 together with documents presented to the committee.
Ordered that the report be printed.
Mr Acting Deputy President Whish-Wilson, I bring your attention to the state of the chamber.
(Quorum formed)
I move Australian Greens amendment (2) on sheet 7710:
(2) Schedule 1, item 1, page 3 (lines 13 and 14), omit paragraph 115A(1)(b), substitute:
(b) the online location flagrantly infringes the copyright; and
The committee is considering the Copyright Amendment (Online Infringement) Bill 2015. The question is that amendment (2) on sheet 7710, moved by Senator Ludlam, be agreed to.
When we concluded just before question time, Senator Fierravanti-Wells had just concluded the government's position. I will now move to our position on Greens amendment (2). I might suggest to Senator Ludlam that he move amendments (2), (3), (7) and (8) together, as they all deal with the issues he raised, as indeed does amendment (2), which removes facilitation of copyright infringement as a criterion for issuing an injunction, and the issue of imposing flagrancy as a criterion.
With respect to the first point, Labor understands the concerns raised by some in this debate about the breadth of the term 'facilitate' in this bill. However, it is important to note the context in which the word appears. The bill only covers websites which have the primary purpose of infringing copyright or facilitating copyright infringement. Clearly, all manner of websites might unwittingly and unintentionally facilitate the infringement of copyright in one way or another, but that is not the test. The question is whether it is the primary purpose of a website to do so. As a result, Labor is satisfied that it is appropriate for facilitation to remain in the bill, and we will not support this amendment.
With regard to the second point, with respect to flagrancy, as I have said, the 'primary purpose' test in this bill imposes a deliberately high burden on rights holders making their case to the Federal Court. This amendment would add to the test a requirement that a site flagrantly infringed copyright. Flagrancy is a concept known to Australian copyright law, and it has been used in legislation similar to this bill in other jurisdictions. However, as I have said, and as the committee concluded, the primary purpose is the appropriate threshold requirement for the grant of an injunction. I note that, under the bill as presently drafted, flagrancy is already a matter the court can take account of in deciding whether to grant an injunction. Similarly, the court can also take into account whether the site shows a disregard for copyright generally. Labor believes that the current drafting is appropriate, and will not support amendments with respect to imposing flagrancy as a criterion.
The TEMPORARY CHAIRMAN: Senator Ludlam, do you want to move only amendment (2), or a broader range of amendments?
No, and I will speak to my reasons for not doing that. I understand the point that you raise, Senator Collins, and I will take it as read that that is the position of the opposition for that series of amendments. The reason I am moving them separately is that this amendment deals specifically with flagrancy, and in a moment I will get to my strong concerns with how wide the term 'facilitate' is. But I will move through these amendments one at a time.
Noting the comments from both the government side and the opposition side, I am not going to detain us for too long before putting the amendment. It might sound a little bit technical, and I do not believe by any means that the concerns that I am putting on the record have been met by the comments of either the opposition leader here this afternoon or by the government. I will quote briefly from the Australian Digital Alliance submission to the bill, because it goes to the direction and the target of this amendment. The way that they put it is in their submission to the Senate inquiry is thus:
… the most preferable outcome would be to consider flagrancy as part of the scope for the online locations that can be blocked under the injunctive process (ie, a precondition for eligibility for site blocking injunction, not merely one of the factors to be assessed in determining whether to make an order). The flagrancy of the infringement is frequently referred to in the explanatory memorandum. It is a strong safeguards to ensure that injunctions are used against the most blatantly infringing sites et cetera without catching infringing services.
That is why we have targeted the amendment in the way that we have to effectively raise the threshold, or raise the bar, to make sure that in order for a court to issue one of these injunctions on application by a rights holder the sites must be flagrantly infringing copyright. I do not think that is unreasonable. I think it is a great shame that, evidently, this deal has been done outside this chamber and nobody from the major parties is inclined to consider this amendment. Nonetheless, I commend it to the chamber.
The question is that amendment (2) on sheet 7710, moved by Senator Ludlam, be agreed to.
Question negatived.
by leave—I move Australian Greens amendments (3), (7) and (8) on sheet 7710:
(3) Schedule 1, item 1, page 3 (lines 15 and 16), omit " , or to facilitate the infringement of, " .
(7) Schedule 1, item 1, page 4 (lines 10 and 11), omit " , or the flagrancy of the facilitation of the infringement, " .
(8) Schedule 1, item 1, page 4 (lines 14 and 15), omit " , or facilitate an infringement of, " .
What these three amendments do collectively is remove the way that the bill is drafted at the moment, which allows rights holders to seek court injunctions to target sites that facilitate copyright infringement, as opposed to 'enable' copyright infringement. There has been a lot of commentary through the Senate inquiry and outside the Senate inquiry process that has been very concerned about the breadth of the term 'facilitate' as it applies to copyright infringement. It is unnecessarily broad, and it is unclear. It could be used to, for example, take down cloud computing storage sites or services that link shortening sites or social media sites. It could be used to take down sites that provide technical tools that have entirely legitimate uses—for example, sites that provide large file transfer software such as WeTransfer and others. These services absolutely could be argued to facilitate copyright infringement. There is nothing stopping you from, for example, using a file transfer platform like WeTransfer to transfer a copyright infringing item from one party to another. That is absolutely not why that tool was built and it is not why the vast majority of users would use a service like that. Nonetheless, it can be swept up.
The government will probably argue that the bill is drafted tightly enough as it is. I would take strong issue with that. If this is to be targeted we should not be including language as broad as 'facilitating'. I will again quote from page 7 of the Australian Digital Alliance submission:
The Macquarie dictionary defines 'facilitation' as:
1. to make easier or less difficult; help forward (an action, a process, etc.).
2. to assist the progress of (a person): to facilitate the customer to find the right product.
This is immensely broad language. It is exceptionally broad language for a bill that covers the consequences of knocking websites and platforms offline. They continue:
This could conceivably cover a number of online locations offering products that have legitimate uses, but which may also be used assist in copyright infringement. VPNs—
and I will be dealing with VPNs in a separate amendment shortly—
cloud storage providers, providers of Bit Torrent or Internet Relay Chat ('IRC') software, browser plug ins or conversion tools may all be covered, as may blogs or subreddits discussing techniques or sites that may be used to infringe. A project such as Open Rights Group's attempt to transparently list the sites that have been blocked under the UK legislation may have a primary purpose of facilitating copyright infringement if the majority of users used the list to find sites with infringing content.
And that is irrespective of the motives of those who put that list up there. Again, if we are going to have site blocking legislation such as this on the statute books—effectively an internet filter managed through the courts by foreign rights holders—shouldn't we ensure that it is targeted absolutely as narrowly as possible, not at things that facilitate copyright infringement but at things that infringe copyright? That is the distinction we are seeking to draw here. Senator Collins did indicate the position on the half of the opposition a short time ago. I would love to hear from the government why you would be knocking over a perfectly sensible amendment such as this.
On the question of facilitation, I would just like to note that the bill contains a facilitation element because many of the online locations that are intended to be the subject of an injunction operate in such a manner as to avoid directly infringing copyright. For example, they do not host infringing content, but provide links or other means for users to obtain the infringing material. These websites are facilitators, and the bill is designed to ensure that they cannot avoid an injunction by simply not hosting or directly infringing copyright. Facilitation is intended to be a broad and flexible concept, as distinct from existing legal doctrine such as authorisation liability. In particular, in relation to amendment (7) it is unnecessary to include flagrancy as part of the threshold test in subsection (1). The existing primary purpose test is already an intentionally high threshold test that will not include legitimate websites. We have included a number of examples in the revised explanatory memorandum to make this adequately clear. For example, the primary purpose test would prevent an injunction to disable access to an art gallery website operated outside of Australia that may contain an unauthorised photograph.
Minister, what you have just described—a website that could be interpreted as facilitating infringing material via links—could very well apply to a search engine such as Google. How do you intend to avoid that problem?
I am instructed that the existing primary purpose test would cover that situation.
The question is that amendments (3), (7) and (8) on sheet 7710, moved by Senator Ludlam, be agreed to.
Question negatived.
I move Australian Greens amendment (4) on sheet 7710:
(4) Schedule 1, item 1, page 3 (after line 17), after subsection 115A(1), insert:
(1A) To avoid doubt, for the purposes of subsection (1) a virtual private network is not an online location.
I will see if I can improve my luck on this one! This amendment goes to very serious concerns that I have that this bill could be used, and could be interpreted by courts, to prevent the use of VPNs—virtual private networks. It was an issue that was canvassed briefly in some of the contributions to the debate on the second reading. This amendment proposes to clean up this dangerous ambiguity, so that it is at least one thing that we do not have to worry about.
A VPN is a legitimate technical tool with many uses which have nothing to do with copyright infringement. It is used as a security measure and as a way for people to collaborate on a private network across multiple sites. I think Senator Leyonhjelm, in his earlier contribution, identified that when we log on to the Parliament House network from home base or from on the road, using our security token, we are in effect using a virtual private network. They have multiple legitimate uses across industry, government, security agencies—take your pick. You could argue that they also have more niche uses, which are nonetheless valuable and entirely legitimate. For example, a whistleblower could use a VPN to hide their internet address and protect their identity while revealing important information to a journalist. That would be one argument. A VPN may be used by a journalist to prevent their sources from being exposed. It may be used by a systems administrator to test if their company's network is functioning correctly.
Both the communications minister and the shadow Attorney-General have stated that the bill is not intended to capture or block or prevent the use of VPNs. But this is not good enough. Ambiguities have already been introduced—maybe wittingly, maybe unwittingly—by Senator Fierravanti-Wells's contribution before the debate was interrupted for question time. When interpreting whether these things are in or out, the courts must be given certainty as to parliament's intention. The smartest way for us to do that is to make sure that it is in the law. If any loophole is left in the legislation, then it may well be that these clauses are tested by rights-holders trying their luck, and the unintended—or intended—consequences of that would be quite profound.
This is a very simple amendment. It is designed to explicitly remove VPNs from the scope of the bill. I commend it to the chamber.
Labor shares the Greens party's concern that this bill should not capture VPNs. This bill, as I explained in my remarks earlier this morning, is directed only at the worst of the worst—websites which intentionally and brazenly flout copyright law. It is difficult to see how VPN services, which have a wide range of legitimate purposes, could satisfy the primary purpose test in this bill. Nevertheless, for the avoidance of doubt, Labor has asked the government to respond to the concerns expressed by the committee about this issue by inserting into the explanatory memorandum a clarification that the bill will not target VPN services. As a result, this amendment is superfluous.
I note, too, the undesirability of including in primary legislation a reference to a particular technology. We should strive to produce technology-neutral drafting. Thus, Labor will not support this amendment.
On behalf of the government: it is unnecessary to include provisions to expressly exclude a VPN from the scope of the bill. The amendments are not intended to apply to VPNs that are promoted and used for legitimate purposes. VPNs have a wide range of legitimate purposes, and have no oversight, control or influence over their customers' activities. A VPN site with a legitimate purpose would not be blocked, as it does not have a primary purpose of infringing or facilitating infringement of copyright. The bill does not require clarity on the definition of sites that could be targeted, because a legitimate site of any nature would not pass the primary purpose test. Accordingly, we oppose this amendment.
Is the minister telling us—and I want to be very, very clear about this—that courts will be allowed to interpret what is legitimate use and what is illegitimate use of a VPN?
They will; in accordance with evidence and under the parameters in section 115A that we discussed earlier.
Minister, where can we find a definition of 'illegitimate' for the purposes of how this section will be actioned?
I think subsection (1) would adequately assist you, Senator Ludlam.
So for people listening to this debate from outside this house: if it is a rights-holder's view that an individual user is using a VPN to get a hold of content that is deemed to be in breach of copyright, who exactly would be injuncted? I guess what I do not understand is this: if there is a service provider out there offering a VPN service, is that site going to be made unreachable by everybody? Would you expect that a court would knock over use of that service for the entire Australian population, if one user is using it for illegitimate purposes? I genuinely do not understand how you are proposing to make this work.
Senator Ludlam, I would refer you to section 115A, subsection (1):
The Federal Court of Australia may, on application by the owner of a copyright, grant an injunction referred to in subsection (2) if the Court is satisfied that:
(a) a carriage service provider provides access to an online location outside Australia; and
(b) the online location infringes, or facilitates an infringement of the copyright; and
(c) the primary purpose of the online location is to infringe, or to facilitate the infringement of, copyright (whether or not in Australia).
Minister, I need you to explain to us how, if I am a subscriber to a VPN service, I could use that service for a variety of uses—legitimate and illegitimate. Are you proposing to block my subscription to that VPN service provider? Or how, exactly, are you proposing to make it work? These are services that people subscribe to that offer services to people all over the world, including here in Australia, and the government will not be able to control what individual users choose to do with those services. The VPNs themselves do not host infringing content—I do not think you are implying that they do—so exactly what will be injuncted?
It is the online location that has to satisfy the test.
Minister, I am struggling to understand this. A VPN is a website. If it has 100 customers and 20 of them are using that VPN to then access and download infringing material, is it likely or possible—is there any possibility—that the VPN will be injuncted along with the sites that are being accessed via the VPN?
I am advised that it is the online location that has to satisfy the test.
Minister, online location of what? This is starting to remind me of the parliamentary equivalent of Senator Brandis's train smash interview on Sky. It is the web address, is it, that you are going to injunct? Online location of what?
I am advised that it is an online location that infringes the three provisions that I referred to earlier in section 115A—that is, a carriage service provider provides access to an online location outside Australia; and the online location infringes or facilitates an infringement of the copyright; and the primary purpose of the online location is to infringe or to facilitate the infringement of copyright, whether or not in Australia.
I know we tend to avoid drifting into hypotheticals, so forgive me if you think that is what I am about to do, but I cannot work out any other way of assessing whether the government knows what it is doing or I am simply misunderstanding the way that the act is going to operate. There is a VPN service provider out there that provides services to one million people, and they are using that for all manner of legitimate purposes in the way that we use the parliamentary VPN when we are distributed all over the country. I log on, I take out a subscription in that company and I use it to infringe copyright on a third-party site located somewhere else entirely. Are you seriously telling me that because of one bad egg—one user who is using it for dodgy purposes—you are going to knock that business out from its entire Australian customer base? I am reasonably sure that is not what is intended, but it is the way that you are making it sound, so please help us out. I get that you are going to block that site that I might be visiting using a VPN, but I do not understand how you can be proposing to knock the VPN business off the Australian internet at the same time.
VPNs have a wide range of legitimate purposes and have no oversight control or influence over their customers' activities. A VPN site with a legitimate purpose would not be blocked as it does not have a primary purpose of infringing or facilitating infringement of copyright.
The question is that amendment (4) on sheet on 7710 moved by Senator Ludlam be agreed to.
by leave—I move Australian Greens amendments (5) and (6) on sheet 7710 together:
(5) Schedule 1, item 1, page 3 (line 26), omit "proceedings.", substitute "proceedings; and".
(6) Schedule 1, item 1, page 3 (after line 26), at the end of subsection 115A(3), add:
(d) if a person or body with a public interest in the action makes an application to be joined as a party to the proceedings—that person or body.
This is a very important amendment. We have picked up the most significant body of critique that came through the committee process and public debate. These two amendments together would allow third parties—for example, consumer, public-interest groups or individuals—to join the injunction applications as parties to make arguments against specific websites being blocked.
Currently, the only parties that would be involved are the internet service providers, the owners or hosts of the websites that are proposed to be blocked and those who are bringing the injunction in the first place, the rights holders. They are the only ones who can be a party. Our argument, very strongly backed up by a number of submitters to the inquiry, suggests that a much larger number of people are potentially affected and should therefore be able to join those court applications.
Foreign site owners are unlikely to contest injunctions, due to the cost of legal action in a foreign country. It is not inconceivable but is unlikely that they will front up to an Australian court or organise local representation because something is proposed to be blocked here. The experience of similar legislation in the UK has shown that ISPs are unlikely to contest injunctions beyond the first several examples. This was raised in the second reading debate. And why would they? We like to imagine that ISPs are going to steadfastly, every time one of these injunctions lands on their desks, step up and protect their users and fight these things, but we know that will not be the case. Cost and inconvenience will mitigate that substantially.
There will be, by default, no party to these injunctions arguing for the public interest. Try to visualise how it will look in a year or two once the dust has settled—and maybe, by and large, some amongst us have forgotten that this even exists—if a rights holder bowls up and says, 'I want this site taken offline,' the internet-service provider offers no resistance and then the following day the site is gone. That is what we are talking about. When that becomes routine, here, that gives you an idea of why we are opposing this bill so strenuously.
Courts are allowed to approve public-interest organisations to present, to the court, as amici curiae or friends of the court. We saw this in the iiNet High Court case, but the Greens do not believe this is strong enough and that is why this amendment is worded more broadly. This amendment would then allow third-party organisations to join the legal action and oppose injunctions, opening the door for public-interest documents to be made in important cases.
The Electronic Frontier Foundation—a very large and reasonably well-resourced US digital-rights organisation—is very concerned about the way this legislation is being progressed. In a letter to Ms Dunstone, the committee secretary, on 16 April of this year, they put it the following way:
Beginning with the process, we are concerned that in most cases, there will be nobody to advocate for the retention of content for which a blocking order is sought. The Australian intermediary who is party to the proceedings—
in this case that is likely to be the ISP—
has no particular interest in opposing the blocking of foreign content. Although the foreign content provider is entitled to apply to the court to intervene in the proceedings, their joinder to the proceedings remains within the court's discretion (under proposed subsection 115A(3)), and this would entail considerable expense, due to the high costs of foreign parties securing representation before the Federal Court of Australia. As a result, most hearings are likely to be undefended, and the question of whether particular content should be blocked will seldom receive a full and fair hearing.
Thus it becomes routine that sites simply disappear.
In a briefing note provided by the Australian Digital Alliance on 15 June which is on their website, they put it this way:
… once the injunction is ordered, only parties to the original case or parties appointed by regulation can seek revocation or appeal.
As an example as to why this is worrying, say you are working in a cross-border research group that has stored huge data files in cloud facility. If that site is blocked (it is also heavily used by pirates you find out) you have no standing to ask the court for a review of that order, even though you may now not be able to access your data.
That trespasses a little bit on my forthcoming amendment, No. 9, I think, that Senator Collins was inquiring about before, but it would apply equally in the granting of the injunction—that, if your rights are about to be trespassed on, if there is data that you need to be able to access, if a service that your business uses or that you use is being attacked by a foreign rights holder because of something else that might be happening on that server or some other activity that that company or an individual might be carrying out, you cannot come to court and have that argument heard. You would be relying on the ISP to fight that for you and it may be that they will not do that, not through any impure motives on their part. It is just that Federal Court action and representation is extremely expensive.
We believe that third parties, which may be the kinds of public interest groups that have been name-checked a few times on the way through this debate, should be able to be a party to these injunctions if they are of particularly important cases. Also, I believe, should members of the general public, and that is why this amendment is very broadly framed.
With the Senate's indulgence, I will also take my comments to amendment No. 9 rather than addressing them separately. These amendments would provide special standing for third parties wanting to intervene in an application for an injunction under the bill or to apply for an injunction once made to be rescinded or varied. In its present form, the bill provides that parties to an application for a site blocking injunction will be the rights holders, ISPs and the operator of the website in question, should they choose to appear. The bill does nothing which would alter the usual rules of civil procedure which govern standing, interveners and amicus curiae. However, I note that the bill does, in proposed section 115A(8) contemplate that a person nominated by regulation would be given standing to apply for injunctions to be rescinded. The explanatory memorandum to the bill notes that this role might be filled, for example, by the chair of ACMA or of the ACCC. Labor is satisfied that this is the correct approach and we call on the government to make such an appointment as soon as possible.
The bill provides that the parties to the proceedings are the copyright owner, the carriage service provider and the person who operates the online location if, but only if, that person makes an application to be joined as a party to proceedings. There is no justification for creating a right for any individual to be joined in the proceedings. First, this could result in a flood of applications that have little prospect of success and which unreasonably use up court time and resources. Second, the Federal Court has shown in cases such as the Dallas Buyers Club case that it is perfectly capable of balancing competing public interest, including those of consumers. Under the bill, the court may take public interest considerations into account under proposed subsection (5). These are the impact on any person or class of persons likely to be affected by the grant of the injunction and whether it is in the public interest to disable access to the online location. Given that there are sufficient safeguards which ensure that the interest of particular individuals such as consumers can be taken into account, it is not necessary for a specific amendment to be included. Further, the bill enables the government to prescribe a person who may apply for an order to limit, vary or rescind an injunction, and this could include agencies such as the Australian Competition and Consumer Commission or the Australian Communications and Media Authority. These agencies are well placed to be able to assist the court in identifying public interest considerations, including those that affect online consumers. Further, if it is apparent in the future that another particular group's interests need to be represented, the government will consider whether they should be prescribed.
I might have missed a step there. How will the government decide that? Is the government going to be interviewing case-by-case or are you talking about deciding by a process of legislative amendment? What kinds of decisions are you talking about?
It will be prescribed in the regulations.
Is the minister telling us that, if a particular case is afoot and the government believes that there is a strong enough public interest argument for another party to be joined to contest an application, you would legislate to allow them to participate? That is bizarre. Why not pass this amendment now and save yourself the trouble? I find it a bit hard to believe that the government would rush in here and stand up against some foreign rights holder, when you are quite clearly failing to do that in the primary clause of the bill, and allow EFA, Choice or some other public interest organisation to get into court? Is that what you are suggesting you will do?
I am advised that the regulations will contain a framework for appropriate representation that should meet the concerns that you are raising.
It is interesting, Minister, that you raised the Dallas Buyers Club example. Dallas Buyers Club was fought tooth and nail by iiNet. It was contested. What would have happened if iiNet had simply folded, and handed over their users' information? It certainly would not have found its way into court; it would have been over in a day. That is precisely what we are concerned about here. If iiNet had not stood up and attempted to protect the rights of its users, that would have been over and done with very rapidly. That is precisely what we are talking about in this instance.
I commend these amendments to the Senate.
The question is that amendment numbers (5) and (6) on sheet 7710, moved by Senator Ludlam, be agreed to.
Question negatived.
I move:
(9) Schedule 1, item 1, page 5 (after line 7), after paragraph 115A(8)(a), insert:
(aa) any other person with an interest in whether or not the injunction should be rescinded or varied; or
This is the final Greens amendment to this bill—number (9) on the same sheet. We propose to give a third party the ability to seek a review of a website block. To date, we have been talking about the process of injunction—the process whereby the courts would allow a foreign rights-holder to take a site offline, as far as being visible from within Australia is concerned. With this amendment, we concern ourselves with the consequences once that is done—if an injunction has been granted in error; if legitimate uses have been disrupted; if others come along and discover that the site should not have been knocked out.
It appears, on my reading of the bill, that even if your company has been directly affected by having a website knocked over, you cannot order any kind of review; you cannot order any kind of revocation. Melbourne Free University, for example, was accidentally wiped out by ASIC's clumsy blocking of 250,000 sites under a separate power—section 313 of the Telecommunications Act. They had no rights of review either; I think they actually had to come through us. They ended up having to raise a bit of a fuss in public. They contacted us, and I presume they contacted MPs from other parties as well. That is an appalling process, if your legitimate website has been knocked over by an act of casual incompetence. What are we to do if a rights-holder comes through, seeks an injunction, and it is uncontested; the court lets it get up, and then other legitimate interests have been disrupted or trespassed upon, or people go out of business? Why should they not be able to seek review? And firstly, could the minister confirm that my reading is correct, in that it would not be possible for anybody—a third party—to seek a review if their site has been knocked over?
I am advised that they can, by making an application through a prescribed person.
Minister, do you just want to spell that out for us, or for those playing from outside the building: who would a prescribed person be for the purposes of the operation of this part of the act?
The Australian Competition and Consumer Commission or the Australian Communications and Media Authority. And, as I have indicated, there will be a framework in the regulations as well—reference the previous comments.
Okay. So if a site that you are using for legitimate purposes is knocked over, and you can no longer access it—you cannot access data you might have hosted there, or you cannot access whatever it was that it was doing—and you, the third party, have no interest in infringing copyright whatsoever, and that was not the reason that you were using that site. In order to get that block lifted, you have to persuade the ACCC or the ACMA to what—to bring an application in the Federal Court? How would you go about having that block lifted?
Yes; or—I am advised—the target site.
So that is if you could persuade them—the target site—to bring an action; I am presuming that is what you meant. They would be a prescribed person because of their interests—it is their site that has been knocked out.
I am advised that they do have an interest.
Minister, can you describe for us what people will see when they try to access a site that has been blocked under the terms of this act?
I am advised that would be a matter for the court.
I am hoping you have been misadvised. So is there nothing in the legislation, and will there not be anything in your proposed regulations that would require, for example, a block page to be put up that says, 'This site was found to be infringing copyright; that is why you cannot access it.'?
I understand that there are comments about this in the explanatory memorandum. Paragraph 43 of the explanatory memorandum states:
The Court would also have the power to order that the parties establish a 'landing page' at the disabled online location to which internet users who attempted to access the disabled online location would be diverted. This landing page could state that the online location has been disabled in accordance with a Federal Court order and detail the terms of that order. The purpose of a landing page would be to ensure that subscribers are informed of the reason that they are unable to access a disabled online location, avoiding the need to contact their CSP for information.
Thank you, Minister. What I can take away from that is that it will be up to the court's discretion, and also that it will be on a case-by-case basis. They might decide not to do anything of the sort. Is that the case?
Yes, that is the case. As we have said earlier, as the court has shown in previous cases, it is perfectly capable of balancing those competing public interests, including those of consumers.
Although it helps if you give somebody standing to represent the public interest in these matters.
I commend this final amendment to the chamber.
The question is that amendment (9) on sheet 7710 moved by Senator Ludlam be agreed to.
Question negatived.
Bill agreed to.
Bill reported without amendments; report adopted.
I move:
That this bill be now read a third time.
The question is that the Copyright Amendment (Online Infringement) Bill 2015 be read a third time.
We are debating the Social Services Legislation Amendment (Fair and Sustainable Pensions) Bill 2015 tonight. It is a complex piece of legislation. I defy anyone in this chamber to actually try to understand the social security system and to understand the full impact of the pensions process. We are debating this particular piece of legislation here tonight. In my experience working with the Community Affairs Committee it is the first time we have had a bill, one that purports to save over $4 billion for the government, without having any chance for public consultation and an inquiry to give people an opportunity to put forward their views and ask questions. It is even worse than that, because, as you would know, this afternoon the Senate Community Affairs Committee brought down its report on this piece of legislation. Yes, we actually had the opportunity this morning to work through the report on this piece of legislation—when we only had documentation put through by the department today in response to letters, and we had information coming through only at the last moment. We were actually asked to sign off on a committee this morning where we had not even fully read the draft committee report, because the process has been so truncated.
This piece of legislation is important, and it needs to have strong consideration. We had limited time given to us to call for submissions. Early in June the inquiry was declared and submissions were called for. People in the community did not know exactly what the process was. There is a standard expectation for people who work with our committee regularly—and many of the submitters who came through on this piece of social services legislation are regular submitters to a process. So they put forward submissions on the understanding that there would be time for this to be considered. There was no concern that a process would be put in place that would not allow a couple of weeks to look at the process, to look at the submissions, to exchange information and to have a public hearing.
What happened in this place is that last Tuesday we actually had a discussion around the Scrutiny of Bills Committee, where we moved an amendment from this side of the chamber to say that we thought this bill required a longer time for consideration. We had a short debate. We do not like to take much time up for that, because we do not need to have a lot of time on these issues. What we need to have is a transparent process. We had that debate and there was an agreement by the chamber that there would be an extension for the Senate Community Affairs Committee to consider this piece of legislation—well, it is not even this piece of legislation, because I understand a range of amendments have come through from the House this morning relating to this bill, which was a bill that was looking at a number of elements of legislation around pensions, one of which had a time frame that had urgency.
But my understanding is that what we are going to be debating in this place tonight is not that bill. It is a new bill that has actually taken everything out of the original legislation and just focused on the asset-saving component of the original legislation. So, particularly given that, there would have been an expectation, as this legislation does not have an implementation date until January 2017, that there would be an opportunity to have public discussion and some debate and exchange around the intricacies of what will impact on thousands of pensioners in our nation. No-one disputes that fact. This will impact on thousands of people who are currently receiving part or full pensions, and the result of this legislation will be to take that away from them. Even allowing for the very short time that the Community Affairs Committee had put this up on their website and called for submissions, there were already 11 organisations that had given quite detailed submissions, including one personal one—and we have all had that augmented, because many of us have already received quite personal emails from people who feel as though they will be affected, talking about how they believe this legislation will impact on them.
At this morning's meeting the Senate Community Affairs Committee put forward their recommendation that this bill be approved—in fact, it was not this bill; it was actually the wider bill, but they put through a recommendation that the bill be approved. The meeting was early this morning. The house finished their debate about lunchtime. We waited for that committee report to be put into the chamber about two hours ago. So now, we end up looking at the process and seeing where we are going. This is not an effective way to operate. The way that the decision was changed to give an extension to allow for public consultation was an open vote in this place. It was given so that we would come back and have the debate in this place in the first sitting of August, after giving time during the July period for a committee hearing. Then, on Thursday, we had a notice of motion here that effectively changed it back to having this debate here today.
I have not seen that before. It is a novel approach. I cannot argue that the chamber voted for it, but it was passing strange that something for which it was agreed to have a consultation process, a public hearing, engagement, and a chance to have a look at the details and the impact in the community was rescinded and we now have a debate this afternoon. We know the result. We have seen that in the media. We know that we are going through the motions in this place. We know that there has been a deal done between the government and the Greens that this will be finalised this afternoon. In fact I found out about this deal last week after we had had the discussion around the community affairs extensions. That is when I found out to my surprise that there had already been an agreement in the media, in the wider community, that this was going to go ahead. Whilst I am never sure how they operate, Mr Acting Deputy President Seselja—you may well know how these deals are discussed—my understanding is that the deal is that this bill will be done very quickly. It will be done this evening or tomorrow, so then there will be an ability for a period of consultation on the tax white paper over several weeks, which will take in issues of pensions and ageing in Australia.
That could be a very useful thing. It does not really help the people who this bill refers to—the pensioners who will lose their part and full pension. Any discussion that will take place in a white paper discussion around tax at some time in the future will actually be tacked onto the end. My understanding is that this white paper has been evolving over a period of time. This expanded time, which will be the salvation of our community, will not have any value for the people who, as a result of this legislation, will no longer have access to pensions and will have significant questions about their future income.
Those significant questions have already been identified in the submissions that we have had before us. A number of organisations and a number of people have put forward questions. Under a standard process, as you would understand, these questions would be put forward. There would be a time for consideration, and we would have discussion back from the department. But that did not happen. We got public submissions, which raised issues, issues from different groups: the industry super organisation—I will give them their formal title; it always sounds more impressive—Industry Super Australia put in two submissions with a number of questions; the Committee for Sustainable Retirement Incomes—a number of questions also; and also a number of organisations had particular views about public sector superannuation and the future.
On that basis, the normal expectation would be that they would put their submissions in. We would have discussions with the department—and I have to admit: the department provided a fulsome original submission, which set out what the bill did and I appreciate that. Then it put forward a second submission in response to an email from you, Mr Acting Deputy President Seselja, as chair of the committee. And then, splendidly, we got one this morning as well, which was particularly useful when we were actually being asked to sign off on a committee report. The final submission from the department came through this morning at about the same time as I saw the draft committee report.
It is difficult to understand why there is such urgency—why this deal that has been done between the government and the Greens to get this piece of legislation off the agenda—to have this passed quickly so that the changes to people's processes will be done and understood. I just do not understand why it is so necessary to have that in the bag today or tomorrow.
I can always understand when you have time urgency that processes are put in place in this place so we cooperate. We might whinge a bit, because we have not got enough time. But when you have a bill which, in effect, is going to take processes away—between 200,000 or 300,000 pensioners will no longer be in the pension system—I would have thought that considering that that is not going to come into play until January 2017 that there would be some more time for consideration.
One of the things that interested me most in the department's submissions to us was that they talked about the fulsome modelling that they had done—I do not know when the modelling was done—in response to some of the issues that were raised about the timeliness of the changes, the impact of the changes on different percentiles of pensioners and a particular issue about the impact on women. These things were raised in submissions, and we got responses from the department that said that the issues were not real: that it was not standard practice for the kinds of things that were in the submissions about people maximising their income and perhaps harming their lifestyle to save money and ensure that they stayed on the pension. We were told that those things were not accurate.
We were also told that the impact into the forward years, which was a particular issue raised, of these changes was not just now but over a 10-, 20-or 30-year period. The departmental submissions said that in fact this was not true and that they had done modelling that indicated that these things were either not accurate or were not to the extent that had been put forward in the submissions provided to us.
There is just one issue there: we did not get any of that modelling. That was the kind of thing that would have been particularly useful, if we had had the opportunity to have a Senate inquiry to see exactly what modelling was done and how it was done. We did have in the submissions from Industry Super Australia and also from the Committee for Sustainable Retirement Incomes access to direct modelling that they had done in conjunction with partners.
I am prepared always to compare evidence and exchange information. I am disappointed—in fact I am more than disappointed; I am frustrated and angry on behalf of the people who will be impacted by this piece of legislation—that we have not had the opportunity to have the fulsome discussion, examine the information and have the standard operation of this place, which is to bring information before the senators and to work with them so that we can see the balance of the arguments and ensure that there would be an opportunity to make realistic assessments of these arguments and that we are doing our job. We have not been able to do this on this piece of legislation, and I am disturbed by the fact that we have not had that opportunity. This has been an underlying principle of the way that the Senate community affairs committee has operated. There has always been a view that that committee actually works effectively together. We do not always agree. And there could well be value in the process that is before us in this legislation. But we will not have the opportunity to do that—we will not have the opportunity to weigh that up—because the deal is done. The situation is now in place that the tapering rates will change; there will be a stronger tapering rate to pull back the access to pensions for people with assets above a certain amount.
The purpose of the legislation, I am led to understand, is to be more fair. Well, it is difficult to see, when we have actually had the experience we have had with discussions around pensions in this place over the last 18 months. We looked at the budget changes that were promoted by this government in the last budget, looking at the pension system. Those were also put before this place and the community affairs committee. It was argued that those changes would be fair and would ensure that our pension system would be safe into the future. We did not accept that particular argument at that time, and, as a result of the Senate committee process, we were able then to have, over a period of time, public hearings and discussions with the community and arguments that built up to say: 'No—the arguments around indexation that were put before this place and before the Senate after the last budget were not fair and they were not the appropriate way to look at making sure that our pension system was sustainable.' And the government agreed with the recommendations that came out of that. The government saw that there was a lack of support for this process in the community and in the Senate. And the reason that that was able to be identified was the process that we had in place to scrutinise the proposals and to scrutinise the legislation. That has been denied to us in this process.
So now we have another batch of legislation. 'No, no, no,' the government says; 'what we did last time was not fair. This time, we are going to make it fair. We are only going to change pensions for people who are wealthy—who are well off and who have significant assets.' That is the proposal that we have in the legislation. And we have evidence from organisations such as ACOSS and welfare rights organisations to say: 'Yes, this is a movement forward; this should be considered.' I acknowledge, from looking at the information we have, that the people who are being impacted by this legislation are not those who are totally reliant on the pension. They never have been. That has not been the client group to which this legislation applies. But the blanket statement that these people are completely wealthy and that their security will be intact by putting this legislation in, is—in my opinion and the opinion of a number of people who have submitted to this particular process—not understood or accepted.
That is why we, on this side, are not supporting this legislation. We think that these pensioners should be supported and that any change to the pension system should not be done in such a piecemeal way. That has been mentioned by a number of the people who submitted to this particular process, truncated as it was, such as National Seniors and COTA. A number of people have put forward that this is not the way to look at our pension system. You should not just identify one group and, in one sweep, just change their processes without interacting and consulting with them and working through what the real impact will be.
There is not understanding of these changes. But the deal that has been put in place between the government and the Greens will mean that it will go—that this is already accepted. Yet there is no understanding of the impact on these people. Their questions have not been answered. Their futures have not been made secure. And they will have to deal with significant changes which will not, in their eyes, be equitable or fair.
A number of the submitters—as you would know, Mr Acting Deputy President Seselja—compared the circumstances of people who have been affected by this legislation with those of other people who are also currently in the pension system, and their circumstances will be seen as not equitable. That is particularly so around the asset treatment of people who are homeowners, for whom their home is not counted in their pension assessment, and for people for are not homeowners, for whom every asset they have is counted in their pension assessment and can actually take away from them in the assessment of the pension.
So this particular process is not supported by the Labor Party. We are not supporting the changes to the pension in this way. We are particularly not supporting the lack of evidence that has come before us to make an informed decision. When we are talking about savings of the extent that we have before us, we believe that there should be the opportunity for consultation, for examination and for a genuine understanding of the direction of the legislation and of the modelling that went behind the arguments that have come forward, not just blanket statements or a list of figures in a draft, which is what we have got in the departmental submissions. We need to see the actual modelling so that that can be looked at independently to show, as to people who are affected by the changes that are being put in place, whether their futures will be secure and whether the impact of the taper will allow them to have the kind of secure future that we expect. I am not saying that the people who are affected by this legislation are the ones who are at the lowest level, but they should be respected and their information should be shared. (Time expired)
I rise today to speak on the Social Services Legislation Amendment (Fair and Sustainable Pensions) Bill 2015. A decent retirement is essential in a caring society—I think we all agree with that. That is why the Australian Greens have not ruled out any change to any part of our retirement income system if it makes the system fairer. Unlike other parties, we remain open to changes to both pensions and superannuation if those improvements result in a fairer system that ensures all Australians can enjoy a decent retirement.
We note that there have been some substantial reviews of parts of retirement incomes and that, in the past five years, these reviews—namely, the Henry tax review and the McClure report—have in fact been looking at these very complex systems. Both these reports identified that significant structural change is required and made recommendations to simplify the tax and transfer system and to make it fairer.
However, the Australian Greens recognise that complex change often requires some initial steps to spark the momentum for broader change. We are not the only ones who believe this, either. A number of stakeholders acknowledge that this is in fact heading in the right direction. Uniting Care said today:
… Uniting Care Australia is pleased that the government and the Greens have responded to ours and the calls of COTA and ACOSS to change the pension asset rules.
… … …
This change is a constructive step in the right direction.
ACOSS have been pushing for this outcome for a long time and said on budget night:
This change in terms of moving away from indexation to a tightening of the assets test, we absolutely backed.
The Council on the Ageing clearly recognised that the review that we have secured will go some way to starting the process. They believe this is a step in the right direction, even if the Labor Party do not agree.
This is how we get change: by building momentum. Imagine if we stopped trying every time the government said, 'No, we won't do what you want.' I would not be here if I believed that was the case. But this policy stands on its own merits. This policy effectively reverses the decision of the Howard government to spend the benefits of the boom on tax cuts and bonuses to shore up support in the lead-up to the 2007 election. Senator Brown, who was leader of the Greens, said at the time:
The Howard government is focused on giving the aged pension to more wealthy retirees when it should be focused on raising the income of those currently struggling on the aged pension …
The Australian Greens opposed this measure in 2007 because it gave high-income earners a more generous retirement income while doing nothing to address the needs of the most vulnerable. We now support its reversal, particularly as this measure ensures that more Australians who do not have the advantage of a healthy super balance will be able to access a full pension.
We need to look at the role of superannuation and assets in retirement. The debate about the impacts of this bill has highlighted the role of superannuation as a complementary policy to means tested pensions that is designed to ensure that people save throughout their life for their retirement. I know that Labor has been citing a range of statistics supplied to them by the super industry, in particular, Industry Super Australia. One of these statistics is that half of new retirees will be affected by these changes. Without any further consideration, that sounds pretty scary. But one of the key conclusions that we draw from their submissions is that more people will retire with super assets that exceed the minimum thresholds into the future.
In fact, we know super is increasing. It is reflected by industry reports that superannuation hit a new record high this year, and over the past 12 months there has been a 14.3 per cent increase in total superannuation assets. A disproportionate amount of this is going to the top 20 per cent of people. But clearly everyone is benefitting from the higher compulsory super contributions from their employer and will retire better off than previous generations did.
When we consider this measure, we need to stay clear eyed about how much these pensioners are holding in personal wealth. The superannuation system is doing what it was designed to do. It is not doing enough properly, and I will come to that. Is it really fair for a millionaire to claim a pension? Is someone who owns their own home and has half a million dollars in the bank really comparing themselves to a single person who has no home and no assets and receives a full pension and thinking that the full pensioner has it better? Really?
I note that a number of organisations have said that the seniors that they represent will be worse off. But in making this assessment they are also promoting the assumptions that people should not and will not draw down on their superannuation assets to replace government assistance that they no longer receive. While individuals have autonomy and control over how they structure their retirement incomes and are encouraged to find arrangements that best suit their personal circumstances, the policy settings in Australia have deliberately encouraged the accumulation of financial assets for retirement, not for estate planning. In other words, people who have significantly accumulated wealth are encouraged to spend it. After all, super is, in particular, a forced savings scheme that helps people fund their retirement. So some draw down of assets is clearly required and is, in fact, intended.
The departmental modelling shows that an individual may be required to draw down up to 1.84 per cent of the capital annually if those assets are not earning them any form of return at all. At this rate, a single home owner with half a million dollars in the bank would take at least 25 years to draw down their assets to $290,000, which is the level where they would be eligible for a full pension. However, we also note the evidence that the committee received that many part pensioners are increasing their assets. For these pensioners, the time it would take to draw down their assets would be substantially longer than 25 years.
I acknowledge that some individuals have their investments invested in low-yield accounts and they are not earning very much additional income from them. It is clear that these individuals will need to adjust if they want to avoid drawing on their assets to the extent outlined by the department, and that is why we need to ensure there is significant and thorough financial advice provided to people so they can earn better income from their assets. While there will be some variation from person to person, it is clear that people will be able to supplement their retirement income and still achieve a decent life for the duration of their retirement if they have assets above the proposed minimum thresholds.
I also note that a number of organisations have tried to model the effects of the pension changes. This has led to a range of claims and counterclaims being thrown about. I note that the Labor Party and the ACTU are quite happy to tell us how women will be affected in 2055. But I would argue that some caution citing these projections should be taken when you are projecting that far forward. Let us take a moment to reflect how difficult it is to make such predictions about the future. Who would have predicted in 1975 that our world would look the way it does today? In 1975, we did not have the internet—we did, in fact, have free education—and there were many other things that are totally different. Who really thinks we are going to have the same settings in 2055 that we have now? What things will change in another 40 years? There will be significant change in another 40 years. Who thinks that nothing else will change between now and 2055?
What we do know and what is clear is that superannuation tax concessions are not creating a sustainable system for the future. The Financial System inquiry shows that one-third of all superannuation tax concessions are going to the top 20 per cent of earners. This means that the well-off are able to get richer while those in lower and moderate income jobs are unlikely to have enough to comfortably retire. Submissions to the tax review have also demonstrated that a number of people will be unable to retire comfortably if we do not make structural changes to how people save for the future during their working life. Women in particular are poorly served by our current arrangements, and here I agree that numbers affected are likely to increase over time. But when we drill down into Labor's argument that 80 per cent of women will be worse off, we find it is based on this great little graph in Industry Super Australia's submission. When you look at the graph closely you realise that it shows that, in 2055, 60 per cent of women will not achieve a comfortable standard of living under the current policy settings. In their terms this is an annual income of $42,000—which is $20,000 more than the basic rate of pension for a single person—so there is also an argument to be made there.
Putting aside the argument about what a comfortable or decent retirement actually is—because different people have different opinions—this demonstrates the challenge that we still need to resolve if we aspire to ensure that women's retirement incomes are higher than the basic rate of the pension. With this in mind, increasing the minimum threshold in the assets test will assist those women who retire with very limited savings, by helping to ensure that they are eligible for a full pension. However, in the long run we need to address the reality that women are paid 17 per cent less than men, are regularly lumped with unpaid caring responsibilities and, as the majority of part-time workers are women, they bear the brunt of the regressive 15 per cent tax on super. This is why the Australian Greens support the effort to make the system fairer by giving more to those with modest assets while building momentum for super changes and the other changes that are needed to ensure all Australians have a decent retirement.
A number of organisations have called for a broad review of retirement incomes that builds on the substantial body of work that already exists. In particular, they are calling for an examination of the interaction between pensions, superannuation, taxation and employment. In response to this repeated call, the Australian Greens have taken steps to ensure that retirement incomes are a chapter, not a paragraph, in the tax review. Stakeholders will have not only the extra time to put in submissions but also the opportunity to talk directly with the government before and after the green paper is produced. It will be very hard for the government to continue to ignore the evidence that organisations are preparing for the tax review and the continued campaign to change super. It is clear that Australians will demand a response that makes retirement incomes more, not less, caring and equal. The Australian Greens are calling on the government to engage stakeholders in the tax review in good faith, and hope that all parties demonstrate their support for serious structural reform that does not exclude any aspects of superannuation, taxes, pensions or employment. We need this in order to reverse the growing wealth inequality between older Australians and to ensure that all members of our community can live with dignity in retirement.
I will take this opportunity to remind the chamber that the Greens are the party that has consistently stood up for those who rely on the pension. You will recall many of the attacks on low-income people that have taken place in this very chamber over the years—some before my time in this chamber, and some during the time that I have been here. Let us talk about single parents, shall we? It was Labor, as I recall, who supported pushing those single parents that were grandfathered from the Howard government's Welfare to Work; who pushed thousands and thousands of single parents and their children off the single parent pension and onto Newstart. Data from Senate estimates shows us that 95 per cent of the single parenting payment recipients are women, and that they are struggling to meet essential living costs. Where was the passion for the pension then?
Let us talk about those who are surviving on the disability support pension. It was Labor who brought in the legislation that denied both young and old Australians access to the disability support pension for 18 months while they had to prove whether or not they could find a job. They were condemned to living on Newstart—an allowance, not a pension. As well as that, Labor supported the Liberal government's attack on young people on the disability support pension, with their reassessments. And let us not forget the revised impairment tables, which made it even harder for those with disability to get access to the disability support pension. These are pensioners, these are people whose lives were made harder. How can Labor say that they care about pensions when they have demonstrated their willingness to hit other pensioners over and over again?
It is time to put policy first. The Greens have thought long and hard about this decision. I have agonised when I have been reading the emails, but this is about making the retirement system fairer for everyone. The Greens are sticking to our principles rather than trying to shore up votes for the next election. We have to take a stand to make long-term decisions that ensure our income support system truly provides a decent, adequate standard of living. Both of the major parties have been refusing to talk about real change that is needed, and to take this change seriously, whether it is addressing this particular change or changing superannuation. We know that needs fixing. We know that there is growing inequality in this country. The report from ACOSS today highlighted that. The report released by the Bankwest Curtin Economics Centre at Curtin University last week showed growing wealth inequality. We need to tackle it.
We need to be making change not from election to election, but long-term change. By supporting this measure and continuing to build momentum for change, the Australian Greens are building on the work we have been doing in this place for over a decade—work that Senator Brown did in this place on retirement and on ensuring that all Australians have access to a decent retirement. That is what our eyes are on—making a fairer system that looks at and takes into account superannuation, pensions, taxation, employment and age discrimination. Those are the things that we have on the map, and on the page. That is where we are heading.
Sitting suspended from 18 : 30 to 19 : 30
I want to reiterate some of the issues Senator Moore mentioned earlier in her contribution in regard to this bill. This legislation has been unduly rushed. The speed at which this bill is being passed through this place is utterly ridiculous. The changes are not going to be implemented until January 2017, yet we are being expected to pass this bill today. This bill passed the House probably three or four hours ago, so I would have to wonder what the great rush is. One of the big areas of concern I have is that the Senate Community Affairs Legislation Committee has also been extremely rushed in its report. It is extremely unusual that a bill that will affect so many people—hundreds of thousands of single pensioners and couples—is rushed so quickly and so unnecessarily.
As much as I do not want to say it, it would appear that the Greens and the Liberals have done a dirty deal and the bill is being rushed through before that deal falls apart. I find it extremely hypocritical of the Greens to rush this bill. They have come into this place on many occasions in the seven years that I have been here and complained when other bills are rushed due to a genuine need. It is utterly hypocritical. As a member of the Senate Community Affairs References Committee, I know how well these committees work in a bipartisan manner. As Senator Moore said earlier this evening, the committee only received answers from the department this morning, yet the report was tabled earlier this afternoon. I am at a loss to understand why there was just 18 days between when the inquiry was referred to the committee and when the committee reported on such an important issue. This issue affects so many people.
Labor senators on the committee had very little time to even write a dissenting report, but I thank Senator Moore, Senator Carol Brown and Senator Peris for the important comments they made. The Labor senators highlighted the deal done between the government and the Greens to amend the reporting date and to require this report to be finalised two full months in advance of its prior reporting date, the agreed reporting date. This change presented significant difficulty in ensuring this inquiry could fully investigate the impact of the changes proposed in the bill. We on this side consider the change of reporting date to be contrary to proper process and contrary to the proper functions of the Senate. As I said, I do not know how many times I have heard the Greens come in here and complain about things they think are not due process or are not proper functions of the Senate. The change in the reporting date unnecessarily shut down a proper public debate and discussion about the changes. As I said, this is an issue that will affect thousands of Australians, mainly on low- to middle-incomes. I wish to record Labor's strong opposition to the change.
I note that the conclusions drawn by the government and Greens senators are contrary to the evidence presented. It is really a case of the evidence saying one thing and the committee report saying another. In particular, a significant number of participants in the inquiry have taken issue with the changes proposed by the government to the assets test. I am particularly concerned about the disproportional impact that this will have on women. I would like to quote evidence in the dissenting report from Industry Super Australia:
The proposed changes in the taper rate will amount to a 15 per cent overall cut in the retirement income of some people who are on incomes below a comfortable standard, while people on higher incomes are largely unaffected. Women are especially harmed—under the proposal, eight in 10 single women retiring in 2055 will do so on incomes below that needed for a comfortable living standard …
The Bill's negative effects on single women will hit those on pretty modest incomes: Women aged 55-59 will be affected from earnings above $46,220; women aged 45-49 are affected from earnings above $40,568 and those aged 25-29 from earnings above $23,954.
Their evidence—and this was in the dissenting report also—indicated that:
The proportion of new retirees affected by the proposed change will increase sharply over time. The proportion of new cohorts of retirees affected by the proposed asset test change increase from one in three today to seven in 10 by 2050. This influx will increase the overall proportion of the Age Pension population who are worse off from just over 10 per cent in 2017 to over 40 per cent by 2055.
People might think 2055 is quite a way off. But if you are a young person, or even a not so young person, in the workforce now and you are working towards your retirement, 2055 is not that far off. That is one concern I have. I have other concerns with this bill, and not just in regard to the process and the contents. To begin with, there is the title. The title of this bill includes the words 'fair and sustainable pensions'. Yet this bill cuts the pensions of single pensioners by up to $8,000 a year, and of couples by up to $14,000 a year. I doubt that there are many Australians, particularly among those relying on their pension for income support, who would regard that measure as either fair or sustainable.
The Prime Minister looked down the barrel of a camera and promised no change to pensions, yet it was not very long after that that he launched the most savage attack on pensioners as one of the key elements of his cruel and unfair budget—it was only one of a number of savage attacks, I might say, but it was a savage attack. It was a cut which would have seen the pension drop from 28 per cent of average weekly earnings to just 16 per cent within four decades. Within the next ten years, pensioners would have been worse off by $80 a week, and the measure would have ripped $23 billion out of the pockets of Australian pensioners. This was just the first wave of the Abbott government's attack on Australia's pensioners. My Labor colleagues and I spent a year fighting this savage attack on Australia's pensioners and, fortunately for the 3.5 million pensioners, we won that fight. But now we are faced with the second wave of the government's attack—a cut to the pension which will affect 320,000 pensioners, of whom 90,000 will lose their pension altogether. This is an extraordinary move from a government which promised—listen for it—no cut to pensions.
Labor does not support the government's proposed changes to the pension asset test, and we will oppose this bill. These changes will disproportionately affect pensioners on low and middle incomes. Independent analysis of the proposed changes shows that the impact of these cuts will fall hardest on people with below-average incomes. Assuming a five per cent return, a single pensioner generating an income of only $25,000 a year from their assets will be around $8,000 a year worse off. Based on the same return—that is, five per cent—a couple earning $20,000 a year each would lose $14,000 a year. While about a tenth of Australia's 3.5 million pensioners are currently affected by these changes, the effects will be felt by more and more pensioners over time. Within ten years, around half of all new retirees leaving the workforce will be impacted by these changes. And in the future it will continue to be those on low incomes who experience the greatest impact. To illustrate this point, a couple 20 years from retirement earning only $45,000 each will be worse off by $1,500 a year each. By contrast, a couple earning $145,000 each will lose only $113 a year.
It is estimated that, under the current assets test, about half of all single Australians retiring in 2055 will not achieve a comfortable retirement. I am not sure what the government thinks is fair and sustainable about this. Under the proposed changes, this will increase to 70 per cent of single men and 80 per cent of single women. In fact, as well as attacking the living standards of low and middle-income Australians, the government's change to the asset test provides a perverse incentive for retirees to divest themselves of their assets instead of saving for their retirement. Professor Miranda Stewart, director of the Tax and Transfer Policy Institute at the Australian National University, said that the proposal is poor policy because it penalises savings. Her submission to the committee's inquiry into the bill said:
The proposed asset test tapers effectively doubles the rate of the wealth tax on pensioners while simultaneously narrowing the tax base, contrary to generally accepted good principles of tax and transfer design.
… … …
Assuming a return to savings of 5%, a consequence of the asset test is that income from savings is heavily taxed at an effective marginal rate around 160%…
What Professor Stewart means by this statement is that pensioners will be worse off by $1.60 for every dollar they earn from their savings. Similar comments have been made by National Seniors Australia and by the Committee for Sustainable Retirement Incomes. In fact, the message the government is basically sending to new retirees is this: withdraw your retirement savings and go on a spending spree. This may be great for short-term economic stimulus, but in the long term it is going to result in people relying on more, not less, government assistance for their retirement incomes.
It appears that the government will get the support they need for this cruel cut to the pension because of the deal they have done with the Greens. It is interesting that the Abbott government would ally themselves with the Greens, because on the day before the election—in fact, the very same day Mr Abbott that made his no-cut-to-pensions promise—he also promised, in a Fairfax op-ed, that the coalition: 'will not do any deals with the Independents and the Greens'. Well, we all know what has happened. I think it behoves those on this side of the chamber—those of us who stand up for pensioners—to remind the Greens that their charter says that they will introduce measures 'that redress the imbalance of wealth between rich and poor'. I would invite the Greens to reflect on this statement and to consider who this change to the assets test will affect, particularly with reference to the analysis I mentioned earlier. If this measure goes through, as it appears it will, Labor will have no hesitation in reminding the 320,000 pensioners affected—and the millions more who will be affected over time—that it was the Liberal-National coalition, with the support of the Greens, who voted to cut their pension. And, contrary to the claims of the government that it will only affect the well-off, this Liberal-Green pension cut is an attack on low and middle-income Australians.
Labor is not opposed to fair and sensible savings, but we are opposed to cruel, short-sighted and ill-thought-out policies like the government's proposed change to the pension asset test. It is important that we address a couple of deliberate misconceptions that the government is trying to peddle about Labor's position on this matter because if you listen to speakers on that side of the chamber you would think that Labor is not serious about making savings. But their argument is really a straw man. It is patently ridiculous to suggest that, just because we do not accept every savage cut that the Abbott government puts forward, we are not committed to making savings. I also hear the government's catchcry, in this debate and in other debates, that if Labor does not accept the government's savings then we have the responsibility to put forward alternatives. Well, guess what? We have—we have put forward alternatives. In fact, Labor has released policy which will deliver $20 billion worth of savings over the next 10 years. These savings include a crackdown on tax minimisation by multinational companies and better targeting of superannuation tax concessions.
The key argument we always have with the government is not whether savings should be made but who, or what, should be targeted when it comes to making savings. On this side of the chamber, we believe it is those who can most afford it; the government seem to think it is those who can least afford it. Do the government really believe that nothing should be done about superannuation tax concessions when only 10 per cent of Australians receive 38 per cent of concessions? You really have to question the priorities of the government when they think it is fair that a pensioner on less than $30,000 a year should have their pension cut by $8,000 while another retiree can have a superannuation balance of $1½ million and an income of $100,000 a year and pay no tax whatsoever. The Abbott government have their priorities very, very wrong. When seeking to make savings, they immediately turn their attention to the most vulnerable and disadvantaged people in Australia, while looking after the powerful and wealthy. This is why they go after low-income pensioners while opposing proposals for superannuants with multimillion dollar balances to pay a reasonable amount of tax.
I know many of the unpopular measures in their first budget were dumped, including the GP tax, pension indexation and their unfair and unaffordable paid parental leave scheme—I think that was the Prime Minister's signature tune; his signature policy. Well, it has gone and I hope that, in the not too distant future, so will be the Prime Minister. Let us not forget—because this is really important for people to remember—that these things would be law right now had the government been able to secure the support of the Senate. They did not dump these policies because they were unfair or because they were so clearly rejected by the Australian people. They dumped these policies because they could not get them through the parliament.
Of course, whenever the government try to justify their broken promises and their cruellest cuts, what do they do? They try to blame Labor by pointing to the position of the budget. Despite all their finger-pointing, it was the current government who doubled the deficit so soon after coming to power. People need to be reminded of that. They tried to fudge the 2013 Mid-Year Economic and Fiscal Outlook and pretend that the budget had been left in worse shape that they thought. It is a cheap parlour trick and remains a pathetic excuse for Mr Abbott breaking his clear, unequivocal promise on pensions.
I have had hundreds of pensioners contact my office to express their disgust at the government's betrayal, and I know my colleagues on this side also have. Senator Polley, Senator Ketter, Senator Urquhart and Senator Conroy—all of us on this side—have received those emails and had pensioners contact our offices. Let me remind and assure pensioners: Labor will continue to stand up for you and we will continue to hold the government to account for their broken promise. We will not waver on this issue, because on this side we understand that those on low and middle incomes deserve a break, not those who can well afford a break so that they can make even more money.
I rise to speak in support of the changes contained in the Social Services Legislation Amendment (Fair and Sustainable Pensions) Bill 2015. Let me begin by saying that Senator Bilyk is absolutely right: many of the government's budget measures stink—they stink. The attack on the poor through the government's removal of income support in the previous budget continued into this budget. There was its attack on health care by introducing the GP co-payment. There was its attack on our hospital system by starving our state hospitals of funding. It has attacked so many people in society—the poor, the sick and the vulnerable. But—and there is an important 'but' here—there are some areas of this budget that are worthy of support. The changes to pensions are a very modest improvement to the pension system. They are very modest but an improvement nonetheless.
Let's start with a bit of history about how we got to this position on pensions. This was the result of a 2007 cash giveaway by the Howard government. This was largesse in the middle of a mining boom and in the lead-up to an election, where the Howard government decided to increase the asset threshold to make pensions available to millionaires. That is what it was. It was a cash giveaway—and the Greens opposed it at the time. At the time we said, 'It's not acceptable that we give money to people who, over and above the family home, have more than $1 million of assets. That's not what the pension system was designed to do.' This measure reverses that position taken by the Howard government back in 2007 and opposed by the Greens then. It reverses it.
You're trousering pensioners. You've got your hand in pensioners' pockets.
Let's get a few more facts on the table. Eighty per cent of people will not be affected by this change. Eighty per cent of pensioners will not be affected. Who will be affected? One hundred and seventy thousand pensioners at the lower end of the scale will receive an increase in the pension of, on average, $30 a fortnight. If you have more modest means and are at the lower end of the asset scale, you will get an increase under this arrangement.
Who loses out from this deal? According to Senator Bilyk, the most disadvantaged are those people who own $1.1 million over and above the family home—let's remember the family home is exempt from this decision. Those people who have assets of over $1 million as well as the family home, which might be worth several million dollars, are the new battlers for the Labor Party. They are the disadvantaged community that Labor stands to represent. No. This is a good decision. It is a sensible measure.
You can't justify it.
While there is a lot of hyperventilating from Senator Polley and Senator Conroy, I suggest that what they need to do is have a chat with some of their colleagues in the shadow cabinet. For example, there is the shadow Treasurer, Chris Bowen, who supports the Greens policy on this measure. Tony Burke supports the Greens policy on this measure. Anthony Albanese supports the Greens on this measure. Mr 'Let's reduce income inequality across Australia' Andrew Leigh is in favour of the Greens on this measure. Half the shadow cabinet supports this decision and we have a Prime Minister who goes into bat for people with assets of over $1 million. They are the new battlers for the Labor Party.
To be frank, I am just staggered that we are here. I thought this would be a non-controversial debate. I thought we would be here with this legislation supported by all members of parliament and we would go some way to fixing a pension system that was broken. The last time the government was in control of pensions we had single parents camped out at Jenny Macklin's office complaining about removal of income support for those people. Here, we are expected to believe that this is an opposition that supports the battlers—those millionaires and single parents, of course.
Who else supports the policy? Let us have a look. The Australian Council of Social Service, a group of people who go into bat for the most vulnerable in our community, are staunchly in support of these changes, and there is the Council on the Ageing and UnitingCare. They all strongly back the changes—along with half the shadow cabinet. It is no surprise that we have industry super funds that do not support it. They are a vested interest in this with a clear mandate to ensure that governments look after people's retirement incomes rather than their own members'. It does not surprise me that the ACTU supports the position of Australian industry super, given the nexus between industry super funds and the ACTU.
My message to the Labor Party is, if this policy position is so reprehensible, rule it out. Let us see Mr Shorten, if he becomes Prime Minister, make an unequivocal commitment to repeal this piece of legislation. It is simple. You can demonstrate that your words are more than hollow words by making a clear commitment to ruling out these changes should you become the next government of Australia. So far, there is deafening silence. We have an opposition leader who criticised this position but will not commit to reversing it. That is hypocrisy, in the extreme.
You can still change your mind!
You can change your mind!
You will not commit to reversing it if you are in government. You will criticise it and yet you will take the savings. You will bank them if you become the next government. If that is not true, come out and make the commitment, right now. They will not.
Let us look at what else this legislation delivers. This legislation delivers a review into retirement income, something that Senator Siewert has been battling hard, with the sector, to ensure that we can deliver on it. And we will deliver on that. We will get a review into retirement incomes, because it is true that addressing the issues of pensions is only one small part of what it means to live a decent retirement. We need to look much more broadly at issues like superannuation, retirement age, age discrimination and many other issues that feed into what it means to have a good, fair and decent retirement.
We do have, now, a review into superannuation taxation concessions. That is a start. We are having a national conversation about what it means to live a decent retirement, and superannuation tax concessions are a critical part of that. I look forward to both sides of politics supporting the costed Parliamentary Budget Office proposal for reform of superannuation that the Greens have now put on the national agenda. That is a good thing.
So what do we have? On balance, we have a reform to the pension system that addresses the issue—
Senator Conroy interjecting—
Mr Acting Deputy President, on a point of order: I am sitting behind Senator Di Natale and I can barely hear him. He has obviously touched a raw nerve with the Labor Party, here, tonight. Could you remind them that interjections are disorderly, please.
Senator Whish-Wilson, you make a very good point, and I am sure Senator Conroy has picked it up and will act in a very orderly fashion. Senator Di Natale, please resume.
Thank you, Mr Acting Deputy President. At the risk of causing a myocardial infarction in some of my colleagues, I will keep my comments a little more brief and come straight to the point. This is a government that has attacked the social contract on so many issues but, on this one—just like a broken clock—they have it right. A broken clock gets it right sometimes. We need to get a fairer pension system and this is a small step towards doing that. It ensures that people of more modest means get an increase in their pensions and it means that people with assets of $1.1 million over and above the family home get less. I do not think that is a bad thing. I think that is fair and reasonable. It is consistent with our position in 2007. It is consistent with where a number of groups—like the Australian Council of Social Services, Uniting Care and the Council on the Ageing—believe we need to get to. It is consistent with where half of the Labor Party's shadow cabinet are at. It is why the Greens have supported it.
We have supported it because the policy measure stands on its own two feet. In addition to it, we have delivered on a review into what it means to live a decent retirement, something we think is critically important. Should a future government decide to tackle some of those bigger issues around what it means to live a decent retirement—superannuation, tax concessions and age discrimination—we will have a blueprint for them ready to go. I just hope that those people standing in opposition to this bill, should they get the opportunity to reverse these changes, reverse it. But guess what? They won't—because their words are hollow.
I rise to speak on the Social Services Legislation Amendment (Fair and Sustainable Pensions) Bill 2015. Australia is a generous and compassionate nation and our society has been built upon a commitment to help those less fortunate, but the measures in the bill before tonight stand to jeopardise this. The measures in this bill stand to dissolve the strong social safety net put in place by Labor. Labor will continue to fight for a strong social safety net for those who have worked hard and saved for their retirement. We will protect a safety net that says that when you grow older, when you have worked your whole life, when you have paid your taxes and when you have worked to build this country, then the government will ensure you have a sensible and reasonable retirement. The Prime Minister has tried to cut the pension ever since he was elected. Academics and policy experts have condemned these nasty pension cuts in their submissions to the Senate inquiry into the legislation. The Senate inquiry would have allowed proper scrutiny of these cuts, but the Abbott government and the Greens have teamed up to shut it down. By ramming and rushing these cuts, the Abbott government and the Greens are not allowing us to have a wholesome and mature discussion and are denying us the ability to do our jobs properly.
Those on the other side of the House like to talk a lot about how much they respect older Australians and how they want to protect them in their retirement, but we are yet to see them walk the walk. It is very easy to talk the talk, but when are they going to start demonstrating it? As said before, we have before us a bill of legislation that is unfair and represents repeated broken promises. The first broken promise is reflected in those famous words spoken by the Prime Minister when he said he would make no changes to the pension. He promised this nine times before the last election—not once, not twice but nine times. Tony Abbott's first budget disgracefully targeted pensioners as an easy source of revenue and now we are witnessing a second lot of changes the government wants to make to the pension.
The first time the Abbott government targeted pensioners in 2014. Labor joined forces with the community and won. We stood side by side with pensioners in every corner of Australia and fought the Prime Minister's unfair changes from last year's budget and we won. Because of Labor, 3.5 million pensioners can rest easy, but we will continue to stand for Australian pensions. The next phase of the government's push to unfairly target pensioners has begun and the Australian Greens have signed a grubby deal with the Abbott government to rip $2.4 billion from pensioners' pockets. It does not matter how many times Senator Di Natale, the new leader of the Greens, comes into this chamber and tries to justify the agreement that was made, he cannot, because, quite frankly, the Greens have sold out. Quite clearly, they have sold out and they have joined the coalition. So, when it suits them, they come into this chamber and make claims about them being holier than thou, that they are the people who speak for the undertrodden and those people who have been left behind, but, quite clearly, when it suits them they will get into bed with the government, and that is what they have done on this occasion. This is quite clearly a grubby, dirty deal to put their hands in the pockets of every Australian pensioner in this country.
This deal sends an unmistakable message to every pensioner in Australia to never, ever trust the Abbott government and to never, ever again trust the Greens. As I said, it does not matter how many times the Greens say it—whether it is the Greens leader or any other member of the Greens team—they will never be able to justify this unfair attack on the retirement of Australian pensioners who have saved, worked and paid their taxes for all these years and planned for their retirement. We have examined the proposed changes in detail and we have looked at how it will impact on retirees in the future. We have also worked through the policy detail and consulted with the ageing and superannuation sectors to understand the true impact of these changes. This is the way we go about business, because, unlike the government, Labor values fairness. Every which way we turn, all we see is a sustained attack on pensioners who have worked hard all their life and saved hard to retire with some comfort.
We will continue to stand by the Australian pensioners. There are 330,000 people who have worked their entire life and have planned for their retirement who stand to be up to $8,000 worse off every year because of the inequitable and short-sighted move by the government and the Greens. Through this bill, we are seeing 330,000 pensioners worse off in the first year. There will be 90,000 pensioners kicked off the pension altogether and more than half of the new retirees will be left worse off over the next 10 years. Some single pensioners will lose $8,000 and some couples will lose $14,000. The Abbott government is so out of touch with Australian pensioners.
I would like to reflect again on the shameful role of the Greens in this process. Their decision reflects incredibly poorly on the Greens who have sent a million retirees up the river for short-term political gain, and what have they gained out of this grubby deal? What has this grubby deal delivered? A review of superannuation when already Mr Abbott has ruled out any change for the wealthy superannuants of this country. We know that it does not matter, in most cases, what Mr Abbott says or what he puts in writing. He does not keep to his commitments. I will tell you one thing: I would put my house on it that he will keep this commitment, because he will never, ever review superannuation benefits for the wealthy in this country. That you can put your money on every single time. We know on this side that Tony Abbott will never, ever deliver anything more than just a review of superannuation. How can sensible, mature members of this Senate be so gullible as to believe that this government would deliver anything more than a review? We can all review papers, just like they will review them—'We've reviewed superannuation, but we're not changing our position—not at all.'
The Abbott government's dirty deal with the Greens proves that there is only one political party in this country that Australian pensioners can depend on—and that is the Australian Labor Party. We on this side are proud to stand up for Australian pensioners. We will stand up and fight for the pensioners to the next election and beyond. We are the ones who understand that those people entering into retirement—and Australian pensioners—need to have some certainty. They need to have some security. These changes that the Greens are going to support will not allow people to have any certainty or security going forward in their retirement. Australians deserve much better. They certainly do not deserve to be undermined and belittled by Scott Morrison and Mr Abbott. Labor will remind Mr Abbott every day between now and the next election of his broken promises to Australian pensioners. As I said, I am proud to be part of a traditional political party that has always put fairness and equity above political pointscoring and short-term opportunities—unlike the Greens.
Can I say yet again that, too often, we have to sit in this chamber and hear from those opposite—from government senators like Senator Macdonald and like so many others—who come in and lecture us almost daily about the Labor-Greens deals; it is always Labor and the Greens.
The Liberal-Green alliance, protected from the chair.
We now have, very clearly, a Liberal-Green alliance—an alliance that is going to deliver nothing for the dirty deal they have done. They are going to be delivering nothing. The Leader of the Greens tried to justify, in his speech, why they have sold out Australian pensioners—why they have sold out those people who have worked very hard to accumulate some superannuation. He tried to justify this by saying that there is going to be a review of superannuation, and that some future government or some future leader might want to pick up on this. Heavens above! If you are going to do a deal ,the first rule of politics—
Read the fine print!
Absolutely, Senator Conroy—read the fine print. But make sure you get something in return for what you are giving away. And there is no justification for what the Greens have given away. They have given away certainty for Australian pensioners and for those part-retirees who are self-funded. It would be very interesting to see Senator Whish-Wilson go along to the next meeting of the self-funded retirees meeting in Launceston, his home city, and talk to them—
Senator s Conroy and Whish-Wilson interjecting—
Order! Senator Whish-Wilson. Senator Polley will be heard in silence.
You're protecting your coalition partners!
Senator Conroy. Senator Polley, please resume. Do not be distracted.
Thank you very much, Mr Acting Deputy President. Senator Whish-Wilson can be flippant about the self-funded retirees in his home city of Launceston, where we both have our electorate offices, but he will not be so flippant when he is reminded at that the next federal election—because they will not forget this. A lot of those self-funded retirees would, in the main, vote for the government—but they will now label the Greens as being bed partners with the coalition government. At the next federal election, the Greens will reap the rewards of the seeds that they have sown.
But quite sincerely, it is very disappointing. I have worked alongside Senator Siewert on so many inquiries through the work that we do within the community affairs committee. I think she is a very hardworking senator, and I give her credit for that. But to have her now be part of the Greens who sell out Australian pensioners and self-funded retirees—it is just terrible. It is absolutely terrible. I just do not understand it. This is so regrettable, and I am not sure really how to put into words how disappointed I am. I am really and sincerely disappointed. I myself have had to live on a very limited income that was provided by the government in a time of very great stress to myself and my family. And so I know what it is like to try and make ends meet from one fortnight to the next, and to be unable to replace the big items in your household—where you quite clearly just do not have the money to replace your washing machine or your refrigerator. That is the sort of difficulty that the Greens have now put in place for too many Australians who have either retired, are pensioners or are self-funded retirees. They are the strugglers. This should not be happening. Neither should it be the case that those who come in here and lecture us about fairness and equity are selling out to this most conservative, arrogant, out-of-touch government that I have witnessed in all my time of being here in the Senate.
I rise to speak to the Social Services Legislation Amendment (Fair and Sustainable Pensions) Bill 2015, a piece of legislation which is being rushed through this parliament without a proper public hearing. I would like to commend the Labor Party's Senator Moore on her contribution to this debate. Senator Moore's speech rang the alarm bell on this piece of government legislation which will take more than $4 billion from our pensioners and older Australians over the forward estimates. I understand that the government may have the numbers to win the vote on this piece of legislation, with Greens support, and I am very disappointed with that. I feel sorry for the hundreds of thousands of elderly, sick and disabled Australians who will be adversely affected by the passage of this bill.
I will shortly outline my concerns and the concerns of some Australians who have contacted my office with regard to the Social Services Legislation Amendment (Fair and Sustainable Pensions) Bill 2015. But firstly, I will give a brief description of the six basic measures this bill attempts to deliver:
1. Defined benefit income streams – from 1 January 2016, ensure that a fairer proportion of a superannuant's actual defined benefit income is taken into account when applying the social security income test by introducing a 10 per cent cap on the income that can be excluded from the test. The measure will not apply to military superannuation schemes.
And I am grateful for that.
2. Proportional payment of pensions outside Australia – from 1 January 2017, reduce, from 26 weeks to six weeks, the length of time for which recipients of age pension and a small number of other payments with unlimited portability will generally be paid their basic means-tested rate while outside Australia. After six weeks, payment will be adjusted according to the length of the pensioner's Australian working life residence.3. Assets test and concession cards – from 1 January 2017, rebalance the assets test parameters by increasing the assets test free areas and the taper rate by which a pension is reduced once the free areas are exceeded. Those whose pension is cancelled will automatically be issued with a Commonwealth Seniors Health Card, or a Health Care Card for those under pension age, without the need to meet the usual income requirements. Veterans whose service pension is cancelled under this measure will retain their Veterans' Affairs Gold Card.4. Energy supplement replacing seniors supplement – reintroduce the measure provided by the Social Services and Other Legislation Amendment (Seniors Supplement Cessation) Bill 2014 – cease payment of the seniors supplement for holders of the Commonwealth Seniors Health Card or the Veterans' Affairs Gold Card – with a new start date of 20 June 2015 (meaning the last quarterly payment of seniors supplement would generally be made on 20 June 2015).
5. Pensioner education supplement – reintroduce the measure provided by Schedule 4 to the Social Services and Other Legislation Amendment (2014 Budget Measures No. 4) Bill 2014 (the No. 4 Bill) – cease pensioner education supplement – with a new start date of 1 January 2016.
6. Education entry payment – reintroduce the measure provided by Schedule 5 to the No. 4 Bill – cease the education entry payment – with a new start date of 1 January 2016.
Serious doubt has been cast over the figures that the government has put forward relating to this bill, and more time needs to be taken to properly consider these claims. A submission from Industry Super Australia argues that:
There is a lot of detailed and technical information in the Industry Super submission to the Senate Standing Committee on Community Affairs; however, an informal description of the problem with this legislation, which I received from an executive officer, clearly summed up the situation for me. It reads:
To be clear these changes are not about cracking down on wealthy retirees (only 5% of those affected have total assets greater than $1 million) and the Government has ruled out changes to high end super tax breaks.
Some of these people not only pay zero tax on their super but obtain a tax cheque from the ATO for imputation credits worth more than the full age pension each year.
It's middle income earners who will lose out.
That is who will lose out—the middle-income earners:
The main targets are people on average wages or less who have moderate amounts of super.
A single person with $250,000 in super after saving their whole life is not rich—
not by any means—
and it is a pretty small amount if you consider it has to last them up to 30 years.
I am wondering if you actually took that into consideration when you worked it all out:
But include other assessable assets like their car and furniture any they will be losing $2,000 a year.
It seems the Government has fooled the Greens by claiming pensioners with low levels of assets will be better off — but they won't because the Government produced dodgy cameo tables, and has assumed currently historically low interest rates will stay in place forever.
The government has conceded that a group of 326,000 elderly Australians will be worse off, while 170,000 pensioners will be better off. There are better ways that this government can save a $1 billion a year or increase their revenue by $1 billion without stealing from the back pockets of older Australians and pensioners. There are at least two new policy changes which would save the government $1 billion or increase revenue by $1 billion. Firstly, decrease foreign aid by a $1 billion a year. It will still mean that Australia will send $3 billion a year overseas, or $12 billion over the forward estimates—perhaps our ASIS officers will only be able to give $2,500 to each people smuggler instead of $5,000! Secondly, introduce a financial transactions tax. Independent research from the Australia Institute shows that a financial transactions tax can raise at least $1.4 billion a year, or close to $6 billion over the forward estimates—and that is at an absolute minimum!
A financial transactions tax will be levied by most European countries by the end of January next year. It is not new. It is recommended by Nobel prize winners. It can be refined and structured so that it hits the big end of town. So I have to ask: what is stopping you, over there, from doing that? What is stopping you from going after the big end of town instead of these people that have worked hard all their lives and done the right thing with their super? The big end of town are very clever at profit shifting and are able to easily avoid paying their fair share of tax. Indeed, my policy only targets about six high-frequency share-trading companies who use super computers and software to sneak an unfair advantage over mum and dad investors. They skim about $3 billion of profits from mum and dad investors.
I know that the Greens, under their new political leadership, feel that their political strength lies with younger Australians and that they are prepared to burn older Australians for that—bad move! But my message is this: we can and should protect young and old Australians at the same time. Why allow the Liberals to continue with their clever political strategy of divide and conquer?
As I indicated earlier, I received feedback from a couple of elderly Australians whose voices need to be heard in this debate. The first case is that of David and his wife. David and his wife worked as nurses before retiring. They worked long shifts without being paid overtime, and unsocial hours at an average pay rate. They had never received government payments, and most of their salary went towards paying the mortgage, which at times had an interest rate of 17 per cent. They saved and lived responsibly. They never travelled overseas and never dined out, because they thought they would enjoy such things when they retired. David and his wife currently receive a part-pension, with an average priced house and assets well under $1 million. Yet under the proposed changes David and his wife would be no better off than had they lived their life on welfare. The changes come at a time where interest rates are low. Many pensioners will be required to give up private health insurance, creating a greater health burden.
The second case involves Jane. Jane and her husband have assets of $840,000 in superannuation, from which they draw their income and receive a small part pension of $420.80 per fortnight. Their assets include a modest car and some furniture. They had hoped to use the superannuation to fund Jane's husband's entry to aged care, as he has dementia. This requires between $250,000 and $300,000 for the refundable accommodation deposit and then weekly payments to cover a basic daily fee, which works out to be 85 per cent of a single pension. Jane says:
We have lived modestly and preserved as much of the superannuation capital, but now the assets threshold will be reduced and taper rate adjusted, our $840,000 and the taper rate adjusted, our superannuation will mean we lose the part-pension and the pension card.
Jane continues:
Facing a drop in income and loss of part-pension, to avoid dipping into the superannuation needed for my husband's aged care, we will need to cut back on living costs such as heating and Alzheimer's Australia care, drop private health insurance, save fuel by not volunteering in the community anymore.
Jane and her husband have extra living costs as Jane's husband's dementia means he forgets to turn off lights, heaters, taps et cetera. And there is the burden of him living with this terrible disease. Jane and her husband feel they have saved and made financial plans for the future, but the goal posts were adjusted, leaving them wondering why they even bothered.
There are some common points made in feedback: people the government are counting as wealthy are worse off than someone receiving the full pension; the changes will encourage double dipping, where people will dispose of their assets above the threshold to receive a full pension; assets, for the purpose of the test, are not all income producing and include boats, caravans, household contents and personal effects; people will not accumulate more than $375,000 for a home-owner couple, so as to receive a full pension; and, current age pension recipients have made decisions on investments and lifestyle based on the current rules and are being unfairly penalised for following the official rules and working hard.
In closing, once again I remind the Senate of the broken promises—just more broken promises—of the Liberal government and this Prime Minister: The Hansard of 16 May 2013 shows that, as opposition leader, Mr Abbott told parliament:
A coalition government will keep the current income tax thresholds and the current pension and benefit fortnightly rates while scrapping the carbon tax. The carbon tax will go but no-one's personal tax will go up and no-one's fortnightly pension or benefit will go down.
On 18 June 2013 Mr Abbott told parliament:
We will relieve the pressure on families. We will relieve the pressure that we know the families and households of Australia are under. Under us they will keep the tax cuts and pension and benefit rises …
On 27 June 2013 Mr Abbott again told parliament:
We understand that the families and households of Australia are doing it tough.
And, by the way, they are still doing it tough; they are actually doing it tougher. Mr Abbott continued:
That is why under the coalition they will get to keep their tax cuts and their pension and benefit increases without a carbon tax. That means that every Australian household's budgetary position at the end of the week, the fortnight or the month should be so much stronger. It is not just about building a richer society; it is about building a better society as well.
I think the PM forgot the last bit that he said. It is about building a better society as well. It is sad when the words of a nation's Prime Minister are worthless, because that is all they are—worthless. This legislation will not build a better society. This legislation deliberately seeks to tear our society apart. It deliberately creates winners and losers in a generation that knows the meaning of hard work and sacrifice.
I will oppose this bill and will know that I have done the right thing by the generations who guaranteed Australia's greatness. I will not be one of the ones who lets them down. In closing, I would ask that Labor members give a guarantee that, when in government, they will introduce measures which will undo the damage this legislation will surely create. I let the Labor Party know that you will have my support and gratitude on this at all times.
I rise to speak on the Social Services Legislation Amendment (Fair and Sustainable Pensions) Bill 2015. This bill seeks to implement changes to the assets test and assets taper arrangements for the age pension—changes which will provide billions of dollars in savings to the government and leave some single pensioners $8,000 worse off and some couples as much as $14,000 worse off.
Before the last election, as we have heard in the debate here this evening, Mr Abbott had a clear position on pensions, and we all know what it was. The government members in the chamber know what it was. It was no cuts and no changes. And yet, in last year's budget we saw the Abbott government launch one of the most savage attacks on Australian pensioners in living memory. The government's plan to cut indexation would have seen every single pensioner in this country left worse off. Within 10 years, this cut would have amounted to $80 per week. But Labor stood by side with pensioners, their families and the community and defeated these unfair changes. But apparently those opposite did not get the message. They did not get the message that Australians will not stand by and let the government attack pensions while they give the big end of town a free ride.
So again, here today, we see the government attack pension incomes in their second budget. Make no mistake, this measure might spare some pensioners the pain of last year, but it will still have very serious negative impacts for pensioners. This bill will cut pensions for some 330,000 part pensions. They are not millionaires, as those opposite might have you believe, but people who have worked hard and made modest savings for their retirement. They are people who have made modest savings, maybe because they have downsized their family home or because they have worked hard and made voluntary contributions to their superannuation. This bill is a clear attack on middle Australia. According to the government's own figures, 236,000 pensioners will be on average $130 a fortnight worse off—that is $3,380 per year—and a further 91,000 pensioners will lose their pension altogether. This will leave them on average $190 a fortnight—$4,940 a year—worse off.
Before I speak about the specific measures in this bill, I would like to take a moment to put on record my concerns about the Community Affairs Legislation Committee inquiry into the Social Service Legislation (Fair and Sustainable Pensions) Bill 2015. As a member of the Community Affairs Legislation Committee, I wish to take the opportunity to express my deep concern about the circumstances under which the inquiry was conducted.
Pursuant to a Senate resolution on 13 May, the provisions of this bill were referred to the Community Affairs Legislation Committee for inquiry and report by 15 June 2015 after it was introduced into the House of Representatives on 4 June 2015. The reporting date was extended to 22 June 2015 and then, in recognition of the significant implications and complexity of the bill, the reporting date was extended to 10 August 2015.
However—as we know and as other senators have said in their contributions—the very next day the Greens joined forces with the government to shut down scrutiny of the bill and further examination of the impact. Because of that, many people who would have put submissions forward to this inquiry and had an opportunity to give evidence in public hearings have been denied that right, because of this dirty deal that the government and the Greens have done to cut the pension. The government and Greens agreed to change the reporting date back to 22 June, shutting down the Senate inquiry nearly two months before it was due to report and removing the opportunity, as I have said, for the committee to hold public hearings on this bill.
The Senate resolution which originally saw this bill referred to the Senate committee for inquiry is intended to allow time for critical bills to be referred for inquiry and report by 15 June 2015. For the purpose of this resolution time, critical bills are those introduced into the House of Representatives between 14 May and 4 June 2015, which contain substantive provisions commencing on or before 1 July 2015.
Of the six measures in the bill, only one has a commencement date prior to 1 July of this year, with the other measures starting as far out as 1 July 2017. On the same day that the reporting date for the inquiry into this bill was cut short, the government also gagged debate in the other place and moved amendments to remove five of the six measures in the bill, including the measure that commenced before 1 July 2015. The only measure remaining in this bill, the proposed changes to the assets test for the pension, has a proposed implementation date of 1 July 2017.
But for the seriousness of this measure, I would say that this had to be a joke—a complete farce. The way the Abbott government and the Greens have worked to block scrutiny of this bill is an insult to the 330,000 pensioners who will lose up to $8,200 each every year, because of these cuts to pensions.
But, when you look at the evidence that the committee received during the course of this very short inquiry, you can see why the government did not want to allow the Senate committee the necessary time to do a fulsome inquiry into the bill. The majority of submissions to the inquiry raised concerns about the proposed changes, in particular the changes to the pension assets test and taper rates outlined in the bill.
In their submission to the Community Affairs Legislation Committee inquiry into this bill, Industry Super Australia provided detailed analysis which shows that the impact of these pension cuts will fall hardest on people with below average incomes. This analysis also showed that, in the long run, there are more people affected on below average incomes than above. For example, a pensioner with $500,000 in assets achieving a five per cent return is on an annual income from superannuation of only $25,000. This pensioner will lose $8,210 in pension payments every year because of these cuts.
These people are not rich, as the government would have you believe. They are Australians who have worked hard and saved hard for their retirement. As the Industry Super Australia submission states:
[The changes to the asset threshold and the "asset taper rate"] would reduce the retirement incomes of Australians who currently are on modest incomes, and whose retirement incomes are projected to be below that sufficient for a comfortable standard of living in retirement.
The submission goes on:
Consequently, the proposed change is poorly targeted and inconsistent with the public policy objectives of the retirement security system.
In their submission, Industry Super Australia also highlighted that:
The proposed changes in the taper rate will amount to a 15 per cent overall cut in the retirement income of some people who are on incomes below a comfortable standard …
In contrast, people on higher incomes are largely untouched. This analysis of the impacts of this bill is supported by the analysis undertaken by NATSEM which found that nearly 80 per cent of the cut will be shouldered by Australians in the lowest income quintile.
We also had a submission from National Seniors, who had this to say as part of their submission to this truncated inquiry:
The changes reduce benefits to households with relatively modest assets while leaving benefits to high-wealth Australians, such as super concessions, untouched. National Seniors cannot support reforms that tighten eligibility to the Age Pension while generous tax concessions to high net wealth individuals remain in place.
And, for the benefit of the chamber, National Seniors Australia is the largest organisation representing people aged 50 and over, with around 200,000 individual fee-paying members nationally. So it is a broad based organisation, which enables them to act as a truly independent and representative voice for older Australians. And that is what they had to say.
It is not just those at or approaching retirement age who will bear the brunt of these changes. The negative impact of the proposed taper rate changes will extend over the coming decades, with the proportion of new retirees impacted by these changes increasing sharply over time. The analysis provided by Industry Super Australia shows that, within ten years, half of all new retirees leaving the workforce will be impacted by this measure. This analysis shows that:
The proportion of new cohorts of retirees affected by the proposed asset test change increase from one in three today to seven in 10 by 2050.
So it is one in three today, increasing to seven in 10 by 2050. The submission goes on:
This influx will increase the overall proportion of the Age Pension population who are worse off from just over 10 per cent in 2017 to over 40 per cent by 2055.
Women will be hit particularly hard by these changes over time. Industry Super Australia's modelling showed that, under the proposal in this bill, eight in 10 single women retiring in 2055 will do so on incomes below that needed for a comfortable living standard. This amounts to a 30 per cent increase in the number of women retiring on incomes below what is needed for a comfortable standard of living. In contrast to the millionaires that the government would have you believe will be impacted by this measure, the independent analysis shows that single women on very modest incomes will feel the negative impacts of this bill. Women aged between 55 and 59 will be affected from earnings above $46,220, while women aged between 45 and 49 are affected from earnings above $40,568, and those aged 25 to 29 from earnings above $23,954. These women are not well off by anyone's definition. And, as I said earlier, this bill will not affect millionaires—as those opposite would like the community to believe—but it will affect people who have worked hard and made modest savings for their retirement.
Furthermore, this bill will not benefit as many people as those opposite would have you believe. Those opposite claim that about 170,000 current pensioners will benefit by, on average, $30 a fortnight, due to increases in the assets free area. However, we know that this positive impact may be significantly inflated.
In their supplementary submission to the Senate Community Affairs Legislation Committee's inquiry into this bill, Industry Super Australia again provided analysis that refuted the government's assertions about how many pensioners will be left better off by the changes in this bill. The analysis by Industry Super Australia suggests that:
… the gains presented are overstated, with a significant proportion obtaining no increase or lower increases than suggested.
This is largely due to the operation of the dual means test. So the limited benefits of this bill are completely overblown.
Evidence presented to the Senate Community Affairs Legislation Committee inquiry also showed that these changes will act as a significant disincentive for people to save. In their submission, National Seniors Australia said:
The changes will also result in unfair treatment of some partially self-funded retirees, and create perverse incentives for middle income households to spend rather than save for their own retirement.
So the evidence also showed that the changes will also act as a strong incentive for people to spend their assets down more quickly. That was the evidence that we received. So in the end what these changes will do is to have a negative impact on the adequacy of retirement incomes.
While the government would like to portray this measure as only affecting millionaires, as I and others have said in their contributions the reality is that this pension cut is an attack on middle Australia. In her submission to the Senate Community Affairs Legislation Committee inquiry into this bill, Professor Miranda Stewart, the Director of the ANU's Tax and Transfer Policy Institute, labelled the proposal poor policy because it penalises savers. Professor Stewart wrote:
The proposed asset test tapers effectively doubles the rate of the wealth tax on pensioners while simultaneously narrowing the tax base, contrary to generally accepted good principles of tax and transfer design.
Put simply, the changes in this bill are an attack on pensioner households and a tax on middle income Australians who are planning to retire in the next 10 to 15 years. Professor Stewart goes on to say:
Assuming a return to savings of 5%, a consequence of the asset test is that income from savings is heavily taxed at an effective marginal rate around 160% …
The Committee for Sustainable Retirement Incomes clearly summarised the impact of these changes when they said that there was a 'serious danger of the proposed test encouraging unwise investment behaviour.' This bill, which Minister Morrison has incorrectly called a bill for fair and sustainable pensions, will impact on those with only modest savings, while leaving those on higher incomes largely untouched. It will cause adverse impacts by providing a significant disincentive for people to save and providing a strong incentive for people to draw down on their assets more quickly. This has to be the definition of a poorly thought out policy, a policy which is neither fair nor sustainable for Australian pensioners.
What makes these cuts even worse, even more unfair and even more poorly thought out is that while the government is happy to take thousands of dollars a year off part pensioners with one hand, they are more than happy to hand over tax concessions to millionaire superannuants with the other hand. Labor has put forward a sensible and fair proposal to limit the tax concessions that superannuants with millions of dollars in assets receive. But the government has rejected this proposal. What should we expect from a government with no understanding of fairness and equality?
While those opposite protect the rich and raid the pensions of middle Australia, it is Labor who is left to stand up for what is right. It is Labor who will stand up for people who have worked hard and tried to save for a liveable retirement income. It is Labor who will stand up for pensions, and we will stand up for them every day until the election, when the government will be held to account for the promises they have broken. We will stand with pensioners once again.
As others have so eloquently articulated in their contributions, we are standing here because of the deal between the Greens and the government. What have we really got with the deal with the Greens? We have got a six-week extension period on the tax white paper, and the government is already on record in Mr Hockey's press release saying that the government has given a clear commitment that there will be no unexpected adverse changes to superannuation in this term of government, nor do they have any plans for such changes beyond the next election. Specifically, the government will not increase taxes on superannuation and will not remove any current flexibility in assessing superannuation in retirement. So the deal has been a complete sell-out by the Greens to the government, and it will achieve nothing but to hurt pensioners. I urge the Senate to stand with the Labor Party in opposing this bill.
I rise today to stand up for all retirees and pensioners across this country. It is clear that older Australians are under attack. The Abbott government wants to reduce pensions and pension eligibility by tightening up the pension assets test. The government's proposed changes will negatively impact thousands of retirees and pensioners. My understanding is that these changes will reduce pension payments for some 236,000 seniors and cut 91,378 people from the part pension. Some retirees will be about $15 a week better off. Further, the changes will come into effect from 1 July 2017, in approximately 24 months.
Retirement is one of the biggest life changes a person can make. It takes years to save and plan for retirement. Every year, Australians put money aside through investment or super to prepare themselves. Often, hard-working Australians only have a small amount of money to put away each week. Often they have none. So it takes a lot of years and hard work for Australians to achieve some type of nest egg for their retirement. Often people forgo essentials and give up little luxuries to put money aside. Once in retirement or on the pension, many Australians live day to day on very tight budgets. Any slight change in income can mean the difference between being able to afford to put petrol in the car or not going anywhere.
At a time when costs are increasing in Australia, we should not be trying to reduce the income of those most in need or take income from those who have worked all their life to save for a modest retirement. We should be increasing our support for older Australians and pensioners. Once on the pension or retired, Australians do not have the capacity to change their living arrangements or to draw income from other areas. Adjusting the retirement goal posts for so many Australians at such short notice is both unjust and cruel and will cause much distress across the community. Community groups and not-for-profit organisations are already struggling to cope with the increasing number of people unable to pay their bills or put food on their table.
In addition, the proposed pension changes will impact women. Women are still significantly disadvantaged in our community because they have less superannuation and assets than their male counterparts. Women are the backbone of our nation, and many women have taken time off to bring up children and, as a result, have not been able to accumulate the funds needed for retirement. While I understand the need for the federal government to be fiscally responsible, I am at a loss to understand why the Abbott government keeps trying to target vulnerable Australians. I honestly believe pensioners are under attack because they are seen as low-hanging fruit and a quick fix for revenue raising.
I cannot support these changes. If the Abbott government wants to change the way in which pensions are calculated, this should be done in consultation with the community and alongside reviews of other important mechanisms, including superannuation. Any changes should not be introduced until all those affected and potentially affected have the lead time, resources and capability to plan for the changes and adjust their retirement plans accordingly.
My home state of Queensland is considered the retirement capital of Australia. Not only are we incredibly welcoming and friendly people—and I am sure Senator Moore would agree—we also put on nice weather and offer great beachside locations. Many retirees and pensioners across Queensland will be affected by these pension changes. Queensland is already on its knees. We are still facing high levels of unemployment and a range of other financial and social issues associated with the drought. These pension changes could not have come at a worse time.
I do not support these pension changes, and I am disappointed that, once again, dirty deals have been done to push through legislation that attacks pensioners and retired Australians. I should note that, while a few senators in this chamber seem to think this bill is a good idea because it targets wealthy retirees, the reality is that it targets middle income retirees and those who are unable to change their financial circumstances. My view is one of principle—stop attacking those who are unable to protect themselves. Do not change the pension and retirement goalposts without fair warning. And this is one of the key reasons why I do not support this bill—there is no fair warning, and hard-working Australians are being treated with contempt by the Abbott government.
I strongly urge my Senate colleagues to vote this bill down. The people of Australia do not want and cannot afford these pension changes. I do not support these pension changes.
I rise tonight to oppose the so-called Social Services Legislation Amendment (Fair and Sustainable Pensions) Bill 2015—a title which George Orwell would be quite proud of. Tonight's bill is brought to the chamber courtesy of broken promises and a grubby deal with another political party. The broken promises are legion with this government. We know that in the lead-up to the last election the current Prime Minister promised on nine separate occasions that there would be no changes to the pension. One would have thought that the people of Australia could have taken him at his word, given that he repeated that promise on nine separate occasions. But, no, the Prime Minister cannot be trusted on this particular issue.
The Greens political party is complicit in this exercise. It is quite an appalling breach of trust on the part of the Greens in this area. I understand that the coalition and the Greens have joined forces to shut down a Senate inquiry nearly two months before it was due to report, and that this report would have allowed proper scrutiny of the Abbott government's cuts to the pension. The Greens and the government have teamed up to sell out pensioners. As these changes are not due to come into effect until 2017, it is interesting that the government and the Greens are so afraid to have their pension cuts properly scrutinised.
It appears that the Greens are implicitly agreeing that the pension system is unsustainable, and we know that that is not the case. We know that Australia is considered to have one of the most sustainable pensions in the world. The Allianz Pension Sustainability Index last year found that Australia's pension system is the most sustainable in the world. According to the OECD Australia spends just 3½ per cent of GDP on the age pension, compared with the OECD average of 7.8 per cent. Ensuring the continued sustainability of retirement income is important, but it has to be done in a fair and equitable way, and it would appear to me that the Greens have been sold a pup, with all due respect to the member for Fairfax. We know that while the increase in the assets test free area ameliorates the impact of the doubling in the taper rate, it will not universally deliver increased pension payments for those with modest levels of assets, due to the dual means test. I know senators have spoken about this particular issue before I have. Here I paraphrase a supplementary submission given by Industry Super Australia to the Senate Community Affairs Committee, where they say that pensioners with assessable assets exceeding $1 million are not the target of this measure, as they constitute only five per cent of the losers. So in fact 95 per cent of those affected have assets of less than this, including those with assets of as little as $300,000. The Industry Super Australia analysis goes on to reveal that by 2055 the measure will reduce the retirement incomes of 50 per cent of single females—none of whom will attain a comfortable retirement, thanks to the Greens. It will also reduce the retirement incomes of 50 per cent of single males—none of whom will attain a comfortable retirement, once again thanks to the Greens. And it will reduce the retirement incomes of 10 per cent of couples—none of whom will attain a comfortable retirement, once again thanks to the Greens.
The increase in the assets test free area has been proposed, as I say, to ameliorate the impact of the harsher assets test taper, and this is supposed to argue that there is an increase in the overall fairness of the measure, because it will lead to some modest increases for those modest levels of assets. The Industry Super Australia modelling shows that this will be the case for some pensioners, but the outcomes will vary significantly. Some pensioners with low levels of assets will not obtain any increase. There have been claims made that all part pensioners with assets below the new threshold will be better off, and Industry Super Australia's modelling suggests that that is incorrect. They say that looking at the dual means test leads to the conclusion that the claims have been overstated, with the cameo tables being presented potentially providing a misleading picture as to the effects of it.
Returning to the government's proposition, when Mr Abbott told pensioners there would be no change to pensions they took him at his word, as I said earlier. But it would appear that pensioners are public enemy No. 1 for this government, which is ably aided and abetted by the Greens. We know that last year the government sought to hit 3½ million pensioners in one of the most savage attacks on Australian pensioners in living memory. The plan to cut indexation would have seen every single pensioner in the country left worse off. Within 10 years this cut would have amounted to $80 a week. We would have seen a massive $23 billion ripped out of the pockets of Australian pensioners. That was a broken promise and it would have pushed pensioners into poverty and hardship.
The Prime Minister has resiled from that position, but that is only thanks to Labor's staunch opposition to those changes from last year. This time, he still wants to rip $2.4 billion from the pockets of pensioners. This is reprehensible. We know that, regrettably, under the current tax and transfer policy settings that we have in this country many Australians will retire on incomes below a comfortable standard. According to the modelling by Industry Super Australia and Rice Warner that I referred to earlier, we know that Australia has a world-class superannuation system but it is not matured to the level that we would all like. That means, according to this modelling, that about half of all Australians retiring from now through until 2055 will not achieve a comfortable retirement taking into account the age pension, superannuation income and income from wealth outside super.
And the current system is failing single women especially, as referred to earlier. Over two-thirds of single women aged 55 to 69 will retire on incomes below a couple standard. And we know that even younger women face a difficult future. More than half of women currently aged 25 to 29 will retire on incomes below a comfortable standard. That is the current situation and it is less than ideal. But the measures that are before us tonight will make the system even less fair than it currently is. The modelling I have referred to shows that the changes will initially have a relatively small impact on existing pensioners but the proportion of new retirees affected by the proposed changes will increase significantly over time and over 40 per cent of retired Australians will be adversely affected by the proposed age pension cuts by 2055, according to the Rice Warner modelling.
The report goes on to say that the proposed changes in the taper rate will amount to a 15 per cent overall cut in the retirement of some people who are on incomes below a comfortable standard, while people on higher incomes are largely unaffected. Women are especially harmed by the proposed changes. Under the proposal, eight in 10 single women retiring in 2055 will do so on incomes below that needed for a comfortable living standard, an increase of 30 per cent. The bill's negative effects on single women, according to the Rice Warner modelling, will hit those on fairly modest incomes. Women aged 55 to 59 will be affected from earnings above $46,220, women aged 45 to 49 will be affected from earnings above $40,568 and those aged 25 to 29 will be affected from earnings above $23,954. These are dramatic impact on those who can least afford the changes. This is what the bill does.
As Labor senators speaking before me tonight have commented, this bill is a cut to the pension for 330,000 pensioners. One wonders why this government seeks to target pensioners so repeatedly. Some single pensioners will be $8,000 worse off because of this. A single person who owns their own home and earns less than $25,000 in income will lose $8,200. A couple who own their own home and together draw down $45,000 from super and other earnings will lose around $11,400. That is this government putting its hand in the pockets of this particular group and taking $1 of every $5 from them. How is this fair, and how is it that the Greens could be so naive to agree to changes which are going to be so detrimental to Australians? Pensioners know that, if this bill is passed, not only will the Prime Minister's hand be in their pockets to take away their income; they will find in their pockets also the hands of the leadership of the Greens, who are so complicit in allowing this all to occur.
According to the government, 236,000 pensioners will on average be $130 a fortnight worse off. As my colleague Senator Carol Brown indicated earlier, that is $3,380 a year. And we know that 91,000 pensioners will lose their pension altogether. This will on average leave them $190 a fortnight, or $4,940 a year, worse off. We know that this measure might spare some pensioners the pain of last year, but it will still have very serious negative impacts for pensioners. According to independent analysis, within 10 years half of all new retirees leaving the workforce will be impacted by this measure.
As I said earlier, the government would have us believe—and it would appear that the Greens have tumbled into the mythology—that all of the pensioners who are affected are millionaires. We know that this is absolute rubbish—and I have been through those figures. Let us make no mistake about this, it is an attack on middle Australia. The independent modelling indicates that, over the long run, the largest impacts will be felt by people currently earning below-average incomes. This government is happy to put its hand in the pockets of pensioners and take thousands of dollars a year from them. At the same time, they refuse to have a sensible look at the issue of millionaire superannuants. We know that Labor has put forward a sensible and fair proposal, and we know that that has been costed at around $14 billion, so it is not fair to say that Labor opposes all measures to address the budget deficit. This is a government that wants to leave the millionaire superannuants unscathed and to take thousands of dollars off pensioners who can least afford it. In the process, they would rather double the deficit to $35 billion.
This shows that the government do not get fairness, and they do not get fiscal rectitude. They still do not get that, when you make a promise, you are supposed to keep it. Labor will be holding this government to their promises. That is what good oppositions do. Labor will fight this measure. We will stand with pensioners once again, and we will take this fight to the election. Tony Abbott lied to the Australian people: he said there would be no changes to pensions. He cannot be trusted—we know that. The reality is that Tony Abbott wants to cut the pension. He wants to take money from pensioners while protecting wealthy Australians. It is wrong. Only Labor will fight for the pension.
Can I indicate that I will be supporting this legislation, with some reluctance. But I believe that, in the circumstances, it is the right thing to do for a number of reasons. Firstly, there is an issue about the long-term sustainability of the pension scheme—to ensure that Australians get a pension that is as good as possible but that increases according to male average weekly earnings, which is a higher rate than the CPI rate that was proposed by the government in last year's budget. That was a disastrous suggestion, because the effect of those changes would have been to erode the value of the pension over several years, by up to $80 or $100 a week. It would actually have made a very big difference. I acknowledge Senator Ketter's very thoughtful contribution to this debate. I do not pretend that this is an easy issue.
I have constituents who have contacted me to express their concerns. Yesterday at Adelaide Airport, on the way to Canberra, I was approached by a constituent who expressed their heartfelt concerns about this. They are about to retire, and this would make a difference in terms of their retirement income—a real difference, in terms of the assets they have—that they would have to dip into their assets.
I think it is important, in the context of this debate, not to consider only what was proposed by the government last year. That should not be the benchmark of whether we should go down this path or not, because what the government was proposing last year was an unmitigated disaster. It was not something that was put to the people at the 2013 election. In a sense, there is a safeguard here that I think Senator Ketter has referred to: these measures are not due to come into force until 1 January 2017, and there will be an election prior to that time. Who knows, Mr Acting Deputy President, sometimes I think that we could well be heading for an election later this year. Let the Hansard note the gesticulation of the Acting Deputy President—as in, 'who knows?' In any event, even if the election is held on the third anniversary of the election of the Abbott government—or even after that—there will be an opportunity for this to be a key election issue, which I think is quite appropriate. It is one of the factors that have led me to support this legislation: that there is that safeguard of the electorate having a direct say on this piece of legislation. The Australian Labor Party will be fighting on this issue, as they are entitled to, and I think that it will be a key election issue. But I think that, on balance, this ought to be supported.
If we can just go back into the history of the pension—and I am grateful to the researchers of the Parliamentary Library—we are all grateful for the researchers of the Parliamentary Library—for their dispassionate, considered and objective approach to their research—in the 1940s and 1950s we saw substantial increases in the levels of permissible income and property limits to the pension. In 1954, the Menzies government exempted income from property from the means test. The Gorton government introduced a tapered withdrawal rate in 1969. The annual rate of pension was reduced by only half of the amount for income above the exempt amount, including income derived from property, rather than the full amount as had been the case previously. In 1972, the McMahon government—remember them, Mr Acting Deputy President; you would have been in primary school then—introduced a large increase in the level of exempt income and intended to abolish the means test by 1975 for age pensioners aged 65 and older. The Whitlam government abolished the means test for age pensioners aged 75 years and over in 1973, and for those aged 70 years and over in 1975, having matched the McMahon government's commitment before the 1972 election. In 1976, the Fraser government removed any consideration of assets from the means test, making it an income test only, except for actual income derived from those assets.
The Fraser government commenced a reversal of this trend towards the universal age pension free from any means testing. This trend was replaced with a renewed emphasis on targeting assistance to those most in need—which I think is not an unreasonable proposition. As set out in the Bills Digest for this bill, the main changes to means testing in the Keating and Howard government years were in regard to how certain types of income and assets were assessed, particularly in relation to superannuation and other financial investments. In 1993, the Keating government reduced the withdrawal rate—the taper rate—from $4 to $3 per fortnight for every thousand dollars in assets over the applicable free area. As part of its Simpler Super reforms, the Howard government halved this withdrawal rate from 2007 to $1.50 per fortnight for every thousand dollars over the applicable free area. To put this in context, what occurred was that for a period of about 13 years—almost 14 years—there was a period of bipartisanship, in that both the Keating and Howard governments, for most of the period of the Howard government, thought that the taper rate of $3 per fortnight for every thousand dollars in assets over the applicable free area was the appropriate taper. That was changed by the Howard government in 2007 to $1 50 per fortnight, and many commentators, I believe, are of the view that this was as a result of the Howard government in the lead-up to the 2007 election panicking and wanting to shore up votes but that it did not work because its time was up.
We now have a situation where this government is looking at going back to a taper rate, which was something that had bipartisan support during the Keating era and most of the Howard era. Under this proposal, the asset test limits for allowances and thresholds for the full pension would rise for single homeowners from $202,000 to $250,000 and for single non-homeowners from $348,500 to $450,000. For homeowner couples they would go from $286,500 to $375,000 and for non-homeowner couples from $433,000 to $575,000 from January 2017 as proposed in this legislation. These changes will make a difference. They mean that people can still have assets. It does not mean that they are wealthy—Senator Ketter is right in his analysis—but it is a question of sustainability and equity, in my view, as to those who are most vulnerable, who I think need the support. I note that the constituents who have written to me have indicated that they are very careful with their money and that they are by no means wealthy, and I understand that, but it is a question of how you deal with this vexed issue so that as many people as possible are covered by it.
I was influenced in my views on this issue by the views of Dr Cassandra Goldie of the Australian Council of Social Service and also by Ian Yates from COTA, the Council of the Ageing, who I think genuinely want to have a long-term, sustainable and fair pension system and are concerned about the impact if we do not deal with this issue. COTA in its submission to the inquiry said that over 2,232,000 age pensioners will not be affected by this proposal, which is about 83 per cent of all age pension recipients and 88 per cent of all recipients. COTA makes the point that the increase in the taper rate proposed in the bill will have a negative impact on single homeowner age pension recipients with more than $289,000 in assets or couple homeowners with more than $451,000 in assets. As referred to in the COTA submission, according to the government's estimates 215,000 people will receive a reduced level of age pension, which is eight per cent, and almost 236,000 people, which is six per cent, in all categories will receive a reduction. They mention that there will be a significant number of Australians affected by this, but the vast majority will not be.
I am disappointed with the government's approach to the suggestions by the Australian Labor Party around superannuation. I think that what the shadow Treasurer, Chris Bowen, suggested was very sensible. I do not want to commit myself to the precise figures that Mr Bowen put up regarding the income thresholds, but it seems to me that, if you are earning $75,000 a year from your super and not paying any tax on that, that is not in itself too onerous a threshold before some tax kicks in. I think it was partisan politics at its worst for the government to simply dismiss what the Australian Labor Party has been suggesting about the issue of superannuation. If we want to have a truly sustainable retirement incomes policy, we need to tackle the question of superannuation. It is not about class warfare; it is not about taxing the rich; it is about having a sustainable system of superannuation and aged retirement incomes—because we are talking about situations where people might have $4 million, $5 million, $6 million or more in super who do not have to pay any tax. For a small minority of people, it has become a tax haven rather than a form of retirement income planning.
It is worth referring to the work of the Australian Institute in this regard, where Richard Denniss has been outspoken about the impact of this, suggesting that the cost to the budget of the current superannuation concessions will be very significant. They will go up into the many billions of dollars each year and they will cascade unless we do something about it. I think that Mr Bowen's proposed reforms do have a lot of merit and they ought to be debated and that the government has had a blinkered approach in not dealing with that issue. I think that most Australians will understand that, when it comes to fairness, having some level of tax—let's say 15 per cent—on super kick in on income from your superannuation fund of over $75,000 or $100,000 would not be unreasonable. That is one of the real challenges. My understanding, though I do not have the precise figures in front of me, is that it will cost many billions of dollars in years to come. The point that Richard Denniss made in an opinion piece in The Australian Financial Review is that the superannuation tax concessions are growing at 12 per cent per year. If you compound that, you are looking at a real problem with the cost to the budget.
As to some of the contrary opinions, Michael O'Neill from National Seniors Australia, a person I have enormous respect for, is critical of these changes. He has said that he believes it will not be millionaires who will be affected by the tightening of the pensions asset test, as claimed by the government, but middle Australia. He says that they will be deeply disappointed with those who support this proposal. I do not like disappointing Mr O'Neill because he is someone who does a lot of incredibly good work and I work with him on issues and have enormous respect for him. He also makes the point that these changes will reduce pensions while not addressing superannuation tax concessions. I think a lot of Australians will think it does not quite pass the pub test when it comes to fairness to tackle the age pension issue but not tackle superannuation. I think that that is a live issue.
The ACOSS chief executive, Cassandra Goldie, in a The Australian report on 17 June, backed the government's changes modelled, in part, on her organisation's work. The David Crowe article quotes her as saying, 'Both major parties should strike a compromise on retirement-income policy, including super concessions.' Dr Goldie said: 'In an ideal world we would have a joint approach from the government and the opposition in this area.' Well, we don't, and that's politics.
These changes are unwelcome but necessary. The Labor Party has every right to run with this as an election issue, but I believe most Australians will say it is a compromise—perhaps an unfortunate compromise—to ensure the long-term sustainability of the pension. If we are serious about the long-term sustainability of the budget, if we are serious about the long-term sustainability of retirement-income policies in this country, then we must tackle the issue of superannuation. We must tackle the issue along the lines—and I say this broadly—that Mr Bowen, our shadow Treasurer, has indicated. The government has been bloody minded not to go down that path.
I look forward to the committee stages of this bill. I think there will be a number of questions in respect of it. I will be asking: if there are any unintended consequences arising out of this, and if they are still in government post 1 January 2017, will the government be open to reviewing or recalibrating this particular issue, in terms of any unintended consequences. On balance, this needs to be supported. The alternative of not supporting it is to have a pension scheme that in the long term will not be sustainable.
If there are no other contributions from colleagues then I will close the debate. As amended by the House of Representatives, this bill includes the important budget measure of improving the fairness and sustainability of the pension system.
From 1 January 2017 the bill will rebalance the assets test to make it fairer and better targeted and to help ensure the pension system is sustainable into the future. The changes will increase the assets-test-free area to provide additional assistance to part-rate pensioners with moderate asset holdings, provide an additional increase in the free areas for non-home owners and increase the assets-test taper or withdrawal rate, the assets above the new free areas, from $1.50 to $3 per fortnight, for each extra $1,000 in assessable assets.
Importantly, pensioners who lose pension entitlements on 1 January 2017, as a result of the changes, will be automatically issued with a Commonwealth seniors health card, or the health-care card for those under pension age, without having to meet the usual income-test requirements. Additionally, any veterans who would otherwise lose their veterans' gold card, as a result of changes, will retain their card. The 2015 budget measure removed from the bill in the House of Representatives will be reintroduced, in a separate bill, in due course.
I table a copy of a letter from Minister Morrison to Senator Di Natale and a copy of a press release, of 16 June, headed 'Tax white paper consultation process to be extended'. I understand the whips across parties have been shown copies of these documents. With those words, I commend the bill to the Senate.
The question is that the Social Service Legislation Amendment (Fair and Sustainable Pensions) Bill 2015 be read a second time.
I move:
That the bill be now read a third time.
Order! The committee is considering the Renewable Energy (Electricity) Amendment Bill 2015. The question before the chair is that amendments (1) to (4) on sheet 7712, moved by Senator Singh, be agreed to.
I move Australian Greens amendment (1) on sheet 7707:
(1) Schedule 1, Part 4, page 13 (line 1), to page 15 (line 2), to be opposed.
This is a similar amendment to the one we just voted on. Although it is drafted somewhat differently, it achieves a similar outcome. It is drafted in such a way that we had hoped to have sufficient numbers to support it, unlike the amendment we have just seen. It similarly excludes having native forest burning in the renewable energy target. It is an affront to common sense, ecology and carbon pollution calculations to ever think that burning native forests could be considered a clean energy source. It is far from carbon neutral. There is new science emerging that shows it is three times as carbon intensive an energy form as coal.
We know that we are talking here about native forests with immense biodiversity and habitat value, not to mention tourism value. These forests are worth far more standing than they are logged. We have heard some pathetic contentions, in my view, from the government benches that this is just going to be waste. What an absolute joke. Everybody knows that this is not going to be waste from the forest floor. This is going to incentivise native forest logging. At this point in history, when the bottom has fallen out of the woodchip industry, this one change that the government is now ramming through is going to throw a lifeline to the native forest logging industry. We are going to see the loggers rubbing their hands all the way to the bank on this one.
I think it is really disappointing that on the last amendment, which would have achieved a similar outcome, albeit through different drafting, we saw the majority of the crossbenchers voting with the government to include native forest logging as a source of so-called clean energy. I recall an election commitment from the Palmer United Party for one that they would not change the renewable energy target. Much was made of that election commitment, and I am very disappointed tonight to see that in that last vote the Palmer United Party senator voted with the government on what is a clear change to the renewable energy target. It is one that worsens it, it is one that would see native forests logged and then burnt and it is one that would crowd out genuine renewable energy.
It is an outrageous attack on the renewable energy target to see the 41,000 gigawatt hours reduced to 33,000. It is outrageous to now see the wind sector being attacked by this government, presumably at the behest of and with the complete agreement of much of the crossbench. Now we see some new architecture being talked about with a wind farm commissioner. We know that this government has axed the Disability Discrimination Commissioner and is frantically trying to get rid of its environmental responsibilities, devolving them down to the states, and now we have a move in the complete opposite direction to establish additional regulatory infrastructure around wind for no good reason except on the basis of some confected concern about people's health. There is no credible evidence that wind farms are in any way damaging to people's health. On the contrary, there is immense evidence that coal mines are damaging to people's health as well as to the climate. Yet we see continued denials from this government about that actual and accurate health concern and information, as we see denial of the climate science itself. Is it any wonder when the fossil fuel industry is basically running this government? Again, they will be absolutely thrilled at this cut to the renewable energy target.
Yes, there was excess energy in the national electricity market. What a perfect opportunity that was, then, to retire some of those oldest and dirtiest coal fired power stations. Instead, we see this government acknowledging that there is an abundance of renewable energy and doing all that it can to reduce and slash that. It just does not get that the rest of the world is already turning away from our coal. Demand is already reducing. The bottom has fallen out of the coal price. The government should know this. I do not understand how it cannot see the writing on the wall that this is a time of transition. The rest of the world has already begun that economic transition for good environmental reasons as well as good economic reasons. Yet this government is just wedded to the fossil fuel sector. It has slashed the carbon price. It repealed the mining tax rather than fixing it up so that it could raise some decent revenue. It got rid of the Climate Change Authority. It still wants to abolish the Clean Energy Finance Corporation, although bizarrely it has some strange draft agreement with the crossbench to give that authority more direction. That is pretty inconsistent when you want to abolish that same organisation.
We have an amendment that we are very proud to move. We are seeking all-party support for it. In fact, we are seeking party support to oppose this very bill should native forest logging be allowed by these changes that this amendment would preclude.
Progress reported.
Earlier today during question time I had to withdraw a remark aimed at Senator Waters. I will not repeat that remark here, and I do apologise for my undue outburst. But I want to explain why I made it. In a question, Senator Waters noted that 42 per cent of the Abbott cabinet is Catholic, including the Prime Minister himself, who once trained to be a Catholic priest. As was pointed out to Senator Waters at the time, her question was out of order because it was against a former President's ruling. Chapter 10 of Odgers states that it is not in order for a senator to refer to a senator's religion. Back in 2005, President Calvert stated his concerns about another Greens senator, Senator Kerry Nettle. He said in his ruling that:
Senator Nettle's question included a suggestion that the decisions of the Minister for Health and Ageing were influenced by his religious views. This was undoubtedly an imputation of improper motives against a member of the House of Representatives, contrary to standing order 193(3), and should not have been made. Senators should refrain from any such imputations in the future.
In 1969 President McMullin ruled that it is out of order to refer to a senator's religion. I think that is a very sound rule which should be adhered to by all senators.
So the Greens have form in this area. In fact, you can quite literally say they wrote the book on it. Greens Senator Larissa Waters, in a single question, managed to work in the fact that the Prime Minister, Tony Abbott, had trained at a Catholic seminary and that 42 per cent of the cabinet are Catholic. It is an impressive achievement and it should be recognised.
There are those who would think that, with the decline in sectarianism in Australia so many decades ago, the art of dog whistling on religion would be a dying one. Not so—not with the Greens around. The standard defence by those who use dog whistling is one of straight-up denial: 'What? Who, me?' It is exactly what we saw during question time. 'I was only trying to talk about the Pope's encyclical on climate change.' Sure! It would be like somebody opening up a talk about multiculturalism with the words, 'As you know, 100 per cent of the Greens parliamentarians are white.' It would be completely irrelevant but it would also be completely true.
Senator Waters' reference to the proportion of the cabinet who are Catholic was irrelevant and made in a pejorative tone, as if it were shameful to be a Catholic and even more reprehensible to train as a Catholic priest. Pointing to the religion of different cabinet ministers—
Madam Acting Deputy President Peris, on a point of order: as I said in the question, it was not intended to be disparaging; it was not said in a pejorative manner; and I ask Senator Canavan to withdraw that, as it is attributing false imputations to me which are not accurate and which are in breach of the standing orders.
Senator Canavan, I remind you not to impute any motives to any other senator.
Pointing to the religion of different cabinet ministers in a question to the Senate lacks class. Of course, Senator Waters denied any implication behind her words, because she wanted to land a blow without taking a swing. It was a cowardly claim and a cowardly act. It was cowardly bigotry through the use of dog whistling.
The Greens are massive hypocrites. The Greens speak of tolerance but practise intolerance. The Greens speak of equality—
On a point of order, Madam Acting Deputy President: for exactly the same standing order breach that we just referred to, about imputing improper motives—which are also inaccurate motives—I ask Senator Canavan to, firstly, desist and, secondly, to withdraw the slurs that he has just made on me and my party.
Senator Canavan, I ask you to withdraw those comments, please.
Can I just ask, for clarification, exactly which comments I am being asked to withdraw?
Opposition senators interjecting—
The ones you just made.
Well, there has to be a particular point.
Your last two sentences.
Senator Canavan, you imputed improper motives and you know what they are. I ask you to withdraw, please.
I will withdraw, but if the senator wants to raise additional points of order through you, Madam Acting Deputy President Peris, it would be helpful to point out exactly what I said. I am criticising the statement of another senator, which should be allowed in this chamber. It is not an improper motive. I am not saying that the Greens are acting in an improper way. I am pointing out the Greens' massive hypocrisy in this area—which senators do all the time and are welcome to—and it should be pointed out in this area because the Greens are massive hypocrites. They preach tolerance all the time, like they are all sweetness and light, but they practise intolerance. They speak of equality but they actually practise discrimination. They speak of human rights all the time but then they feel free to mock people of certain religions. Australians should reject—
Madam Acting Deputy President Peris, on a point of order: Senator Canavan, I will continue to take points of order while you continue—through you, Madam Acting Deputy President—to impute improper motives to me, as if I have somehow disparaged the religious beliefs of members of your party. That was not my intention, and I will continue to say it while you continue to assert it. I ask you again to withdraw.
Senator Waters, that is a debating point.
Australians should reject the Greens' divisive and resentful form of extremist politics.
As a practising Catholic I am fed up with how Catholics are portrayed by some in this chamber and some in the media. The Catholic Church is far from perfect but then it is far from evil, too. Some members of the Catholic Church have done some terrible things over time, and the Church deserves admonishment for those things. The Church itself has shown remorse and is trying, however imperfectly, to repent for the sins of some of its members.
What angers me most about the prejudice of some is their ignorance—their wilful ignorance, at times—of the good works that many Catholics do. I met my wife while volunteering at the Edmund Rice Camps when I was young. On these camps, young volunteers like my wife and me gave up their university holidays to help disadvantaged children go camping. They were full of great young people just striving to live by the example of Jesus Christ and help their fellow man. How is it, though, that an entire religion now can be denigrated for the sins of some? We should never denigrate the many for the mistakes of a few.
None of this is to suggest that I think it is improper for Senator Waters to raise the Pope's encyclical. It was quite appropriate for Senator Waters to do that. It was inappropriate for her—as the President ruled—to impute motives to Catholic cabinet ministers just because they were Catholic.
I have not had a chance to read the whole encyclical myself. I have had a quick look at it, and the central lesson that I took from it—and this is where the Pope speaks with the most authority, I think—is that the wellbeing of humankind, in particular that of the poor, has to be front and centre when we look at complex issues like climate change. Pope Francis makes the very strong point that any policy must put humanity as its central concern and that the moral course is to use human wellbeing, in particular that of the poor, for our standard. The Pope says in it that it is not for the Church to 'settle scientific questions or to replace politics', and he highlights the need for honest and open debate. He states:
For poor countries, the priorities must be to eliminate extreme poverty and to promote the social development of their people. At the same time, they need to acknowledge the scandalous level of consumption in some privileged sectors of their population and to combat corruption more effectively.
He goes on to say:
… demographic growth is fully compatible with an integral and shared development …
The most polluted places on earth are in the developing world, in countries without the benefit of industrial development and of cheap energy and electricity. So, industrialisation and fossil fuels have a place too. When we push up power prices, it is the poor who suffer the most. Also, in the 44,000 words of the encyclical, the word 'climate' appears just 16 times. The most common words are 'human' and 'God'.
Some other pressing moral issues identified by the Pope that the Greens might have missed—or, at least, hope the government will ignore—are the dangers of welfarism and the importance of the dignity of work in helping the poor. The Pope says:
Helping the poor financially must always be a provisional solution in the face of pressing needs. The broader objective should always be to allow them a dignified life through work.
He goes on to say:
… Since everything is interrelated, concern for the protection of nature is also incompatible with the justification of abortion. How can we genuinely teach the importance of concern for other vulnerable beings, however troublesome or inconvenient they may be, if we fail to protect a human embryo, even when its presence is uncomfortable and creates difficulties?
While the encyclical did not touch directly on the definition of marriage, the Pope spoke strongly on this in January this year when he said:
The family is also threatened by growing efforts on the part of some to redefine the very institution of marriage, by relativism, by the culture of the ephemeral, by a lack of openness to life.
These are all important points that Pope Francis raises. I welcome the Greens new found interest in the teachings of the Catholic Church, and I hope Senator Waters does take the time to read the full encyclical.
Earlier this month, we gathered at the Williamstown Hall in Melbourne to farewell and to show our love for an extraordinary woman. At that service, where we farewelled Joan Kirner, it was a combination of love, so many shared memories and also an almost sense of disbelief that this force of nature whose passion, energy and resilience have influenced so many was no longer going to be with us. She was no longer going to be the voice on the end of the phone to say, 'How are you?' when you were feeling just a little bit down. She was no longer going to be there to send a message of support at exactly the right time or to put something in a newspaper which would stir up your passion so that you would continue the fight that was so important to all of us.
Joan was a true woman of passion in the way that she led her life from the time she worked so hard to get a strong education. She was strongly supported by her parents, of whom she spoke so lovingly in her first speech as a member of the Victorian parliament. She then went on to work in various fields, particularly education, in the development of policy. So many have spoken about the way that she became political—though it seems hard to believe that the woman was ever not political—when, as a young mum, she took on the forces of the education department in Victoria to ensure that her family would have a strong education and that there would be the right-sized class for her young child.
People forget that before Joan was first elected to serve in the Victorian parliament, she had already been honoured with an Australia Day honour because of the work that she had done in her community, particularly in education and in the very important area of Landcare. The woman worked. She had strong values. Indeed, in the publication that she and her good friend Moira Rayner wrote in 1999, which was a guide book, a tool box, for women to have power, she talked about her values. She said: 'I expect to have my values respected. They are so fundamental that I don't need to spell them out to myself anymore. I know what I believe in. All people are of equal worth. Everyone has an equal right to shape their own lives. Everyone has an equal right to be able to meet their basic needs and to achieve this it is necessary to spread opportunities and life chances as widely as possible to eliminate inequalities, to accept personal and political responsibility and to promote community participation and ownership of decisions.' She also said: 'My values: I try to measure my actions against them all the time and they are that women matter as much as men do. Women have the right to determine their own lives. Women's experience matters and should be valued. Women should be able to describe freely and share those experiences. Women's knowledge and experience should be part of decision making at all levels. Women are entitled to a fair share of the infrastructure that creates equality and equity, education and training, employment, safety, health, family, resources and representation.'
Joan's strength was that she genuinely loved people. People interested her and she wanted to learn about those with whom she mixed. She had a special smile, and so whenever people were in her company she wanted to know how they were. I do not think I remember a time when she did not say, 'How are you?' That was personal and direct, but the next bit was the challenge: 'And what are you doing?'
Everybody has a Joan Kirner story. It is one of the things that we share, now that she is not with us physically. But she is with us, as you well know, Madam Acting Deputy President Peris. I first met Joan in 1995 at the Women Power and Politics conference in South Australia—an amazing event which I have talked about before, which was a celebration of 100 years of suffrage in that state, which led us all, Senator McEwen. Bless the South Australians! She was a keynote speaker—of course she was a keynote speaker. I met her there, and from that moment on I lived not to disappoint her, because when she shared her love she also shared her challenge and her challenge was that we would be the best possible people that we could be.
We all know the work she did as premier, and so many of us know the ongoing commitment she had to ensure those values of which I spoke: to ensure that women had absolute equity. She did that in a number of ways, and certainly from my experience it was through the political network that she helped to start. I have always introduced Joan when I have been in her company as Saint Joan the Patron Saint of EMILY's List . EMILY's List has worked to support women within the Labor Party—I also think it has been and is an inspiration to women who are interested in politics, no matter which party they belong to—to look at what they can do to make choices that are informed and to make themselves and their community stronger and better. With EMILY's List, Joan was not only the leader; she was also the mother and the heart of the organisation—and that will always be.
I have known women across this country who have been through the midst political preselections and campaigns, which are always stressful, as we well know. Joan would ring you up. Often without warning, she would be on the phone and it would just be, 'Joan here.' I have known the impact that this has had on women as they have been working through their own personal journeys in the political sphere. Also, once you achieved process in this area, she never forgot and she would follow up. She would also have very definite suggestions for actions you could take That challenge was always something inspirational. It was that personal link that I think made her influence so strong.
Many people do not know that Joan Kirner had been unwell for many years. She and her family and close friends worked extraordinarily hard to ensure that nobody outside knew her pain and her suffering, because she felt she had a role to play to support numerous organisations, numerous people, and also to bring that special charm and energy into the work that she did. She had an expectation that while you lived you worked—you had a responsibility to ensure that your world was a better place. Joan left all of us a legacy to continue the work she had set out for us to do. Of course she had an expectation that those values of equity would be entrenched, not just in parliament but in the wider community. Her commitment to Aboriginal equity in this country meant that there were very many messages of support and loss expressed by Aboriginal people across the country, as you know, Madam Acting Deputy President Peris, and recognition in the Constitution was one idea that she was hoping she would see come to fruition.
To my good friend Ron, Joan's partner of over 50 years: Ron, you and your family shared Joan with us and gave her complete support and love. We now share her loss with you and the family, but I think we all know that her spirit and her challenge will continue. The biographical details of Joan Kirner are legendary; they have all been spelt out and we know the achievements and lows of her career. Those of us who were fortunate enough to know the woman, to share her love and to know that she genuinely cared, must remember her legacy of equity and support and passion, making sure that all people are of equal worth, as we remember the legacy of her wonderful memory and that extraordinary laugh when you touched her funny bone. That will always be a strong memory of Joan Kirner.
Last week I met a remarkable and brave woman. Her name is Lorena Pizarro. For many years Lorena has travelled the world seeking answers—and justice—about crimes that are unthinkable for those of us who have never lived in a country that has been riven by warfare or internal conflict. Lorena is the President of the Association of Relatives of the Detained and Disappeared in Chile. She is seeking answers about disappearances and tortures. She attended my Parliament House office with members of the National Campaign for Truth and Justice in Chile. Lorena Pizarro was seven when General Augusto Pinochet launched a military coup against his Chilean president, Salvador Allende. The coup followed a period of unrest against the Socialist president, fomented by the United States government. The military abolished the civilian government and established a junta that brutally repressed left-wing political activity both domestically and abroad. The United States government, which had worked to create the conditions for the coup, promptly recognised the junta government and supported it in consolidating power. That period lasted for 17 long years.
As a child Lorena Pizarro saw her home raided and four of her uncles detained. Her family was forced to move constantly because both of her parents were being hunted by the military. In December 1976,when she was 10 years old, her father was kidnapped and he disappeared into thin air. She never saw him again. He was a living, breathing, relatively young man—intelligent, with hopes and ambitions—and she loved him. He was her dad. She never saw him again and never knew what happened to him. Since that time, Lorena has searched for her father. Well, really she hasn't—she knows she will never see him again—but she is searching for the truth about what happened to him. And, more importantly, she is searching for a form of justice—for herself and for the many, many others whose family members disappeared—so that it will never happen again.
Lorena is in Australia to lobby the Australian government, and gain support from Australians from all walks of life, for the extradition of a woman called Adriana Rivas, who lives in Sydney. There are serious allegations that Ms Rivas was intimately involved in horrific crimes 40 years ago in support of the actions of the military dictator Pinochet during Chile's coup from 1973 to1990. It is alleged that Adriana Rivas was part of the National Intelligence Directorate's Lautaro Brigade, whose purpose was to eliminate those who opposed the government. Witnesses allege that part of her job was to extract confessions from prisoners before they were murdered. In 1978, Rivas left Chile to live in Australia and travelled freely back and forth to her home country. However in 2006, while visiting family and friends in Chile, she was arrested, charged and held for three months. Rivas was allowed out of prison on bail on the condition that she report to authorities each month and remain in the country. Four years later, in 2010, she fled to Argentina and returned to Australia. In January last year. Chile's Supreme Court issued an extradition order for Ms Rivas. The court was unanimous in its decision to make the request, because her offences related to 'crimes against humanity'. Ms Rivas continues to live in Sydney.
The charges against Ms Rivas include kidnapping, torture and murder. I am speaking on this matter with caution not to interfere in legal proceedings because I think it is essential that Ms Rivas face these serious allegations in Chilean courts. The law enforcement agencies of the Australian government have been aware of the Chilean government's request for the arrest and extradition of Ms Rivas since August 2013—and the case has been publicised in the Australian and Chilean media. Australian representatives of the National Campaign for Truth and Social Justice in Chile are concerned that Adriana Rivas might take advantage of the delay in executing the international arrest warrant to flee the Australian jurisdiction and go into hiding.
I comment on this matter with caution. But the Chilean government's request for extradition is already a matter of public knowledge; indeed, it was written up in The Saturday Paper last weekend. Despite letters and requests to our Australian government, no good reason has been given to justify the unusual delay in acting. I am mindful that there is serious concern Ms Rivas might take the opportunity to abscond and so I am taking up this opportunity to call on the Australian government to execute the international arrest warrant issued against Ms Rivas as a matter of urgency.
It is important to note that torture and capital punishment are illegal in Chile now, and Ms Rivas is not at risk of being subject to either of those. Officially, Chile has made two extradition requests for Ms Rivas. The first involved an allegation against Ms Rivas—that she was involved in the 'aggravated kidnapping' of Victor Diaz on 12 May 1976. The second order came as a result of Ms Riva's alleged involvement in the kidnapping and torture of seven Chilean citizens—six men and one woman. Among the alleged victims is Reinalda del Carmen Pereira Plaza, a medical technician who was also five months' pregnant when she disappeared. A report by the Chilean National Commission on Truth and Reconciliation states that:
Since the day of her arrest nothing is known about the fate or whereabouts of Reinalda or the child she was expecting.
Another alleged victim of Ms Rivas is Fernando Ortiz, a prominent professor from the University of Chile. His daughter, Estela Ortiz, told ABC's Foreign Correspondent program in 2014 that she believes
Adriana Rivas has to face justice... I think it's the only way for her to live relatively in peace. I believe she has to testify like any other Chilean.
Meanwhile Australia's Justice Minister, Michael Keenan, has been sitting on this decision for over a year now, while the families and friends of those who were tortured and 'disappeared' by the Pinochet regime are forced to wait for justice.
Having met Lorena and seen her anguish, I can understand why families of the disappeared desperately want those who were responsible held to account. These are just a few of the countless stories of the thousands of families who saw family members 'disappeared' during the 17 years of Pinochet's of rule. For those of you who might be hearing this and are interested in following this up, there is a very moving song that was written by Sting, called They dance alone. It captures the heartbreaking anguish and loneliness of the women who dance alone in memory of their men or their sons who were 'disappeared' during that time. They will never know what happened to them and they are left alone to mourn and seek justice.
Lorena Pizarro does not understand why Australia has taken so long to grant Chile's extradition request, and I must say neither do I. The Australian government must respond appropriately under the terms of the Extradition Treaty that was signed by Chile and Australia in 1996 so that the Chilean community can be assured that Ms Rivas will be brought to trial and perhaps some answers will be found. These are serious allegations that Adriana Rivas was intimately involved in the horrific actions of the Pinochet regime and she must face these allegations in a Chilean court. In Australia we say that torture is never, ever justified. I urge the Australian government to uphold this strong belief on the part of the Australian community and to act urgently in regard of this case. It will not bring back those who 'disappeared' under that regime, but it may bring some answers.
I rise tonight to address the issue of gender equality in the Liberal Party, and it seems quite apt after Senator Moore's wonderful tribute to Joan Kirner. I am a very proud WA Liberal woman. When I look around my party, I see an astonishing number of talented and inspirational women, who quite simply are the engine room of our party. All our women are preselected and elected on merit, but the simple fact is we do not yet have enough women in leadership and parliamentary roles.
Today, over seven out of 10 elected Liberal representatives in Australian parliaments are men—over seven out of 10. I cannot help but wonder, if we are truly a meritocracy, how this can possibly be. I am neither a gender warrior nor an advocate of quotas, and I do not identify as a feminist—or at least what feminism appears to have morphed into today. The sisterhood's battle cry, I believe, remains stuck in the past and is a narrow and angry left-wing narrative, one of victimhood, and one that demands women receive special treatment, simply because we are women. This is not the approach I have ever identified with and I have come to believe it does far more harm today than good. I agree with Dame Elizabeth Couchman, one of the founders of the Liberal Party, who said her concerns were not for the battlesome female who talks of 'sex war', but for women who put public good before personal ambition.
Gender is not a 'woman's' issue; it is an economic and social issue. The GDP foregone every year as a result of gender economic inequality is estimated at 20 per cent. This represents an annual loss to our economy of over $300 billion every year—$300 billion! I believe it is time to rethink our approach, and narrative on gender both as a nation and as a party. But to do that we first have to unshackle ourselves from the old narratives of the past to ones based on empowerment, based on strength and based on equality. My favourite Dame Elizabeth quote is: 'Not all wisdom resides under the hats of men.' She said that over 80 years ago, and I believe it is just as true today as it was then.
I believe our starting point when looking to the future must be the belief that, while women quite often do it differently from men, we do it just as well and, in many cases, better—and we do it because we are women, not in spite of the fact that we are women. There is no doubt that women in Australia have made great strides in the past few decades, and internationally Australia ranks comparatively well against many socioeconomic indicators. Despite this, there are many areas in which Australia women still face significant and entrenched difficulties and challenges. Today women are still much more likely to be economically disadvantaged, earn less than their male counterparts, have significantly less retirement income and security and be subjected to the most heinous and high levels of abuse and even murder. I was particularly disappointed to learn that in my home state of Western Australia the gender pay gap is the worst in the nation, today sitting at 25.3 per cent. This is particularly disappointing given that in 1969 there was a legislated pay gap for women of 25 per cent. We have not moved much since then.
Today women comprise nearly 60 per cent of Australian university graduates, but only 52 per cent graduate into professional positions, many starting off their careers in professions earning less than their male counterparts in the same job. The leadership and pay gaps both increase as their careers progress, with only 10 per cent of women reaching executive management and only 3.5 per cent becoming CEOs. Today, of the 400 CEOs and chairs of ASX 200 companies, 6.5 per cent are men with the first name 'Peter', while only 5.75 per cent are women. Think of the implications of that for young women today—men named 'Peter' have a greater chance of promotion to CEO and chair positions in our top companies than they have as young professional women. The previous Chief of Army, my former boss and mentor, David Morrison, said this:
I'm no sociologist. I have no anthropological training. But I am certain of this: we live in a world where the squandering of women's talent, the traducing of their potential is a global disgrace.
Across all parliaments today in Australia, women represent 31.8 per cent of all elected representatives. This is a figure which has pretty much flatlined over the past decade, lingering around the 30 per cent figure regarded by the United Nations as the bare minimum necessary for women to influence decision making. Today, only 20 per cent of ministers across the nation are women. In 1995, 11 per cent of international parliamentarians were women and—20 years later—it is now 22 per cent: a doubling, albeit from a relatively low base. Over the past 20 years in Australia, female representation has increased from 20.7 per cent in 1996 to 31.8 per cent today. As a consequence of this slow increase, Australia's international ranking for women in parliament continues to decline when compared to 190 other countries. Australia has fallen from 20th in 2001 to 45th today. Female representation across all parliaments by political party is as follows: ALP, 43.1 per cent; the Greens, 55 per cent; and the Liberal Party sits at just 22.6 per cent. In fact, our party's lack of progress has been the most significant contributor to our nation's decline in international rankings. Internationally, 22.6 per cent would rank the Liberal Party somewhere between Kyrgyzstan and Eritrea.
In 1902, the Commonwealth of Australia was one of the first national governments to grant women the right to vote and allow them to nominate as federal candidates. Despite this promising start, since Federation only 11 per cent of our 1,656 members and senators have been women—100 in the House of Representatives and 91 in the Senate. Through the 1950s and 1960s, while more women were nominated for preselection, the prevailing belief remained in major political parties that women would not poll well and were not suited to the rigours of politics. As Dame Elizabeth again observed at the time: 'what women think today in politics, men will think tomorrow'. I am sure she would have said they would have thought that the good idea was theirs in the first place! Her good friend and colleague Sir Robert Menzies shared her point of view and her passion for women in politics. His vision for women in politics was clearly laid out in a 1943 national broadcast specifically on women for Canberra. He said this:
We have travelled a long way in our civic outlook upon women, and even if we were reluctant and straggling wayfarers, the events of this war, in which women have been such workers and warriors, would surely have speeded us on our journey.
He concluded the speech with this:
…we should shake our minds clear of whatever prejudice may linger in them and honestly and sincerely acknowledge that there is just as much room in all our public bodies for public-spirited and intelligent women as there is for public-spirited and intelligent men.
Sadly, Sir Robert's foresight is yet to be fully realised in our national parliaments.
The facts are very clear: without a proactive and positive approach to women's socioeconomic outcomes, women in Australia will continue to lag behind men. If politics was a battlefield of ideas, then I believe Dame Elizabeth was a general. Sir Robert said: 'she would have been the best cabinet minister I could have wished for', and, 'she was the greatest statesmen of them all'. I know she would have been proud of the contribution women make to the Liberal Party today, but I suspect she may have been a little disappointed with our rate of progress. One thing I know for sure is that she would never have given up advocating and fighting for women everywhere.
The 70th anniversary of the Liberal Party this year is a wonderful opportunity to discuss this issue honestly and openly to find a new narrative and a new approach—one based on participation, optimism and equality. Women have so much to offer and to contribute as women. The challenge for us today is how to fully realise this potential—so that women have the opportunity to do better than 'Peters' in our society. As the US General Gordon Sullivan said: 'hope is not a method'. Hope may not be a method, but it is a most powerful motivator and a strong catalyst for change.
Senate adjourned at 22:28