Thursday, 9 February 2017
Independent Parliamentary Expenses Authority Bill 2017; Second Reading
That this bill be now read a second time.
In January this year, I made a commitment to establish the Independent Parliamentary Expenses Authority Bill 2017, which will ensure that parliamentarians' work expenses are accountable, transparent, and fair.
Politicians must be accountable for their use of taxpayers' dollars. Australians are entitled to expect that we, their representatives, spend their money carefully, ensuring at all times that our work expenditure represents an ethical, prudent and cost-effective use of public resources. It is taxpayers' money.
As I have said previously, the whole concept of entitlements is anathema to me. These are business expenses and we as politicians should spend them as frugally, if not more frugally than we would our own money. They should only be spent for the purpose of doing our job and we must be accountable for them.
The Independent Parliamentary Expenses Authority Bill 2017 is the first step in the biggest reforms to the management of parliamentarians' expenses in more than a generation.
The authority will be independent. It will be charged with administering and overseeing the travel and related expenses of parliamentarians. This already happens in a number of jurisdictions including, perhaps most notably, the United Kingdom.
The authority's core functions will be to audit and report on parliamentarians' work expenses. It will also provide advice, monitor and administer claims for travel expenses and allowances by parliamentarians and their staff, ensuring that taxpayers' funds are spent appropriately and in compliance with the relevant rules.
The functions will be provided at arm's length from government—distance in this case being essential to maintaining confidence in the decisions of the body, protecting against partisanship, and shielding against misuse.
The independent authority will have an independent board comprised of individuals with diverse yet highly relevant skills, as well as with substantial experience and significant standing within their professions. The board will be responsible for the statutory functions of IPEA while a chief executive officer (CEO) will manage the day-to-day operations.
The members of the board will include a former judge, a former member of parliament, a person who has significant experience, knowledge, and standing in the field of auditing, and a person with wide experience in remuneration matters. With this depth and breadth of experience, the authority will demonstrate a high standard of independence and accountability.
Together with the chief executive, the board will provide confidence to administrators, parliamentarians and the Australian public that their money, public money, is spent appropriately, in accordance with the rules and in a manner that ensures value for money.
Under the current system, as we know, parliamentarians and administrators navigate a complex work expenses framework that is comprised of legislation, regulations, determinations, procedural rules, guidelines, conventions and decisions of executive government.
The new authority is intended to provide clear and consistent guidance, advice and rulings for parliamentarians. Clear advice and guidance is crucial. Currently it is often necessary to read several instruments in order to understand a single work expense. The Department of Finance, for example, has had to produce a suite of eight separate handbooks on the patchwork of legislation and guidelines that form the work expenses framework.
The change that will have the greatest impact on transparency is the modernisation of the system that manages work expenses. Our current system of six-monthly reporting will be updated as soon as possible to allow for a monthly disclosure of expenses in an accessible and searchable format. This process of modernisation will bring Australia into step with jurisdictions around the world and ensure a greater degree of transparency, accountability and integrity in the use of public funds.
The bill will create the Independent Parliamentary Expenses Authority, but we need to go further. In order to support this reform, the government will continue to implement the recommendations of the review chaired by John Conde and David Tune into the parliamentary entitlements system.
My government will present a further significant bill to the parliament in the near future which will improve the legislative and administrative framework of the parliamentary work expenses system—further encouraging transparency, accountability and value for money. The IPEA will perform its functions both in respect of the current framework, and then the new framework once it has been reformed.
The new authority will commence on 1 July 2017, fully supported by these changes to parliamentary work expenses.
In recognition of the immediate need for reform in this area, while we work to establish the Independent Parliamentary Expenses Authority and reform the work expenses framework, I have directed that an interim advisory body be established by executive order. This body will include a board and will administer travel expenses and allowances, and provide advice and support to parliamentarians on the current parliamentary work expenses system in respect of travel expenses and allowances. This body will commence as soon as possible, and then will be abolished—and the board transitioned—upon commencement of the Independent Parliamentary Expenses Authority, pursuant to this legislation.
As parliamentarians we have a duty to ensure that our spending of public money meets the expectations of the Australian public. Transparency and accountability are critical to meeting this duty and demonstrating that it has been met. The Independent Parliamentary Expenses Authority is the first part of a robust response to the obvious shortcomings of the existing systems which will provide greater transparency and accountability as well as greater clarity to parliamentarians in recognition of the unique challenges that we face in representing our constituents across this wide land.
This bill is the first step in the biggest reforms to the management of parliamentarians' expenses in over 25 years. I look forward to working with the opposition and other members and senators to ensure that these important and timely reforms are delivered.