Linda Burney (Barton, Australian Labor Party, Shadow Minister for Preventing Family Violence) Share this | Hansard source

My associations go back to the good old Murrumbidgee River. I am of the Murrumbidgee Wiradjuri.

The second bill gives effect to the government's decision to establish a dedicated financial asset fund—I won't go through the acronym for that; it's very long!—to support the making of annual and discretionary additional payments to the ILC. This fund will replace the Indigenous Land Account, and we spoke about that earlier, the closure of which will be effected by the Aboriginal and Torres Strait Islander Land and Sea Future Fund (Consequential Amendments) Bill 2018. The bill provides for the transfer of the moneys and financial assets currently allocated to the land account to the new fund, which will be managed by the Future Fund board. That all sounds very bureaucratic, and it probably is, but it's important to outline these arrangements in the House today.

The ATSILSFF will be credited with amounts equal to the balance of the land account special account and the value of the investments of the land account. This special account will then be debited to provide an annual payment to the ILC to be credited to and paid for from the ILC funding special account. The finance minister and the Indigenous Affairs minister may also determine once a financial year that an additional payment be made to the ILC after considering the advice of the Future Fund board about the impact of any additional payment on the sustainability of annual amounts to the ILC. That component is also very important—that there is the continuing discretion of the ministers involved to be able to undertake those discretionary payments.

The Future Fund board will be responsible for deciding how to invest the new fund to enhance the Commonwealth's ability to make annual payments for any additional payments to the ILC. The bill requires a responsible minister to issue an investment mandate to the Future Fund board, and that's very much about accountability regarding the investments of the new fund. The purpose of the investment mandate is to provide a mechanism for the government to provide strategic guidance to the Future Fund board on its expectations for the investment of the new fund. That also is incredibly important to the government of the day and to First Nations people. The Indigenous Land Account has achieved an average return over the past three years of approximately CPI plus 1.5 per cent per annum. Under the new arrangements, the government expects that account will achieve a return—and this is really important—of CPI plus 2.6 per cent after fees.

There are a few other points I'd like to make in closing. Expenses associated with the investment and administration of the fund incurred by the Future Fund board will be met by ATSILSFF. I want to put forward what the Labor position is. You can see that with me putting forward this position how much work has gone into making sure that this is for the benefit of those it has been designed for. Labor supports the intent of this legislation. We accept the need to improve the financial sustainability of the fund and we support the expansion of the remit of the fund to cover water. However, after consultation with stakeholders, we took the view that there were a number of ways in which the legislation could be strengthened—and I understand there's been discussion on this—in order to protect the land fund for future generations. We have requested a number of minor amendments to the bill which we believe will achieve that.

Firstly, we have requested of the government that they include provisions in the bill that the minister must have regard to the sustainability of the fund prior to making any additional transfers. I'm sure that minor amendment is something that the government could accommodate. This will help to ensure that these transfers are not used to deplete the fund over time. We also requested that the long-term sustainability be a necessary consideration where the minister sets out the investment mandate. I'm sure that the minister would be considering that as a matter of course. I am pleased that the government has now moved amendments to address both of those issues.

Our second concern is related to the removal of any oversight role of the ILC in relation to the fund. That's important because, when you've got the ILC as the board, they need to understand what's going on in terms of any investments. At present, the ILC board provides oversight of the account. This is not an active oversight role, but, rather, a way for the ILC board to maintain a clear line of sight as to how the account is being invested. Once again, that's a very sensible suggestion. The bill before us, in its original form, removed this. We did not support this. I'll say that again: the bill before us, in its original form, removed this and we did not support this. At a time when there were growing calls for a greater Indigenous say over issues that impact on Indigenous lives, we felt the removal of the oversight was inconsistent with the need to maintain as much Indigenous involvement as possible. We do welcome the government's decision to require the Future Fund brief of the ILC board on their investment decisions, restoring that important oversight of the ILC. We thank the government for that recognition.

We know that this will be a passive oversight role that is not designed to interfere with the functions of the Future Fund but, rather, to ensure that the fund, which is designed to assist Indigenous Australians, is never removed entirely from Indigenous involvement—once again, going very much forward with a philosophical view of the involvement of First Nations people. We also welcome the amendment that will require the minister to consult with the ILC in relation to the investment mandate. This, once again, provides an opportunity for important input from First Nations people into the management of the fund. We believe that these amendments strengthen the bill. We recognise the minister for working with us to achieve a bipartisan position. Having reached agreement on these matters, Labor is happy to support this bill.

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