Thursday, 23 October 2008
by leave—Perhaps we should turn the telescope around and look at a tiny dot in the Pacific. Mr Speaker, Australia’s territories are often forgotten when we think of our national system of government, but our territories are an integral part of the Federation.
As minister, I recognise the need for the Australian government to actively engage with communities in our inhabited territories to acknowledge their unique characteristics and recognise that residents have essentially the same rights and should receive the same protections as every other Australian. Our island territories are isolated and this brings obvious practical difficulties to the delivery of essential services but as far as practicable they should be comparable to those received by other Australians—remote mainland locations are a good benchmark.
Norfolk Island is an important part of the Australian Federation. Its history is fundamental to the Australian story and our development as a nation. On 6 March 1788, just six weeks after the arrival of the First Fleet at Botany Bay, Lieutenant Philip Gidley King landed on Norfolk Island to establish a penal settlement. Over the first decade, the island was the source of supplies that were essential to the survival of the settlement at Port Jackson. Norfolk Island’s first European settlers were also important to the development of Tasmania when many relocated there in the early 1800s. Many Australians today can still trace a personal family connection to Norfolk Island. The violent history of the hellish second Norfolk Island penal settlement was interrupted for several years by the appointment of the Scottish naval officer and geographer Alexander Maconochie as Commandant in 1840. The practical policies he put into place before his removal are regarded now as a foundation of modern penal practice. Many descendents of the Pitcairn Islanders who came to Norfolk Island in 1856 as the third wave of European settlement have made the island their home.
From time to time, there have been attempts to suggest that Norfolk Island has a legal or constitutional status different to that of other Australian territories, or that it is appropriate for the island to have separate international recognition. These suggestions are unfounded and the High Court of Australia has affirmed that Norfolk Island is an integral part of the federation like all other territories. Nevertheless there are a number of serious problems facing Norfolk which, if uncorrected, will become worse as the population ages. Thirty years ago the Commonwealth established a microstate government for a population of less than 2,000 Australians—complete with substantial taxing powers and finance and service delivery roles, some of which even the existing Australian states do not enjoy. The government takes the view that the model cannot be sustained in its present form.
While a minority of islanders may have their own personal wealth to fall back upon, the present self-government arrangements have caused a growing proportion of people to be significantly disadvantaged in comparison to other Australian citizens. Norfolk Island is falling well behind national standards in areas like health, child protection and welfare, and workplace safety. The government of this very small place is not in a position to resolve its problems independently. The island lacks an economic foundation strong enough to support basic programs and infrastructure. Australian citizens on Norfolk Island do not receive all the benefits and protections enjoyed by other Australians, nor do they have the same obligations.
This unique situation gives special privilege to some islanders and disadvantage to others depending upon their personal wealth and circumstance. The Australian government should not be in the business of allowing specific privilege or permitting disadvantage to flourish merely by virtue of location. Unlike other Australians, Norfolk Island residents do not pay income tax. The Norfolk Island government has for a long time said that such a tax would be a crippling burden on a fragile economy. On the other hand, the 2005 report by the Joint Standing Committee on the National Capital and External Territories entitled Norfolk Island sustainability: sink or swim heard evidence from the Australian Treasury recommending that the Australian tax system should apply to Norfolk Island. Our Indian Ocean territories are similarly remote, yet the Australian taxation system applies there without detriment to the development and governance of those islands.
The joint standing committee—chaired by Senator Ross Lightfoot—said in its 2005 report:
… the financial situation on Norfolk Island is sufficiently dire to warrant the recommendation of the Island’s integration into the Commonwealth taxation and welfare system, in spite of the concerns expressed by some Island residents. The Committee is convinced that bringing Norfolk Island into the Commonwealth’s taxation regime will mean the residents of Norfolk Island will have access to better quality services than are currently available.
As a broad comparative example of the disadvantages experienced by Norfolk Islanders living outside our tax system, I am advised that the Norfolk Island minimum wage is $10.70 per hour compared to $14.31 on the mainland. The Norfolk Island aged pension cuts off once recipients earn more than $947 a fortnight. At that rate, Commonwealth pensioners are still receiving $227 a fortnight from the Australian government. Norfolk Island pensioners will not benefit from the Rudd government’s boost for Australia’s pensioners to be delivered on 8 December because Norfolk Island pensioners do not receive the Commonwealth pension; they receive the Norfolk Island pension.
Concerns about the arrangement for the governance of Norfolk have been raised repeatedly in a number of reports and studies undertaken by parliamentary committees. During hearings for a report handed down by the Senate Select Committee—chaired by Senator Ian Macdonald—on State Government Financial Management in September this year, the Hon. Grant Tambling, Administrator of Norfolk Island from 2003 to 2007, submitted that:
… Norfolk Island is in urgent need of governance reform …
And the 2005 report by the Joint Standing Committee on the National Capital and External Territories expressed a view that:
… the Norfolk Island government was not delivering services and was at risk of becoming insolvent.
This year the senate select committee to which I have just referred noted that:
The expectation was that Norfolk Island would also be self sufficient and raise its own funds from within the Norfolk community to pay for its delivery of government services and programmes on-island, using ‘federal’ customs, postal, revenue and taxing powers devolved to it by the Australian Government. Norfolk Island was therefore excluded from federal fiscal and taxation arrangements and from the application of many federal laws and the programmes and services provided under such laws. This has resulted in expensive and sub-standard healthcare and other important services.
In 2005 the Joint Standing Committee on the National Capital and External Territories report concluded:
… the strategies that have been used to date by the Norfolk Island Government have not, and will not, deliver long-term financial sustainability for Norfolk Island.
And at recommendation 1, it said:
The Committee recommends that a new taxation model be developed whereby Norfolk Island is gradually incorporated into the taxation regime of the Commonwealth of Australia.
A 2003 report by the same committee, also chaired by Senator Lightfoot, recommended:
That the Federal Government reassess its current policies with respect to Norfolk Island and the basis for the Territory’s exclusion from Commonwealth programmes and services, with a view to determining: a clearly understood and consistent rationale and framework for Commonwealth funding, advice and assistance that will be provided across government to the Norfolk Island community.
The Australian government are working in many countries of the Pacific to establish political stability and economic prosperity and we have an obligation in our own territories to uphold those same principles. The 2003 joint standing committee said:
Australia’s long term national interest will be best served by ensuring the same principles of good governance in place in other states and territories of the Commonwealth are adhered to on Norfolk Island. In its efforts to promote good governance in the Pacific region and assist many Pacific Island countries to rebuild and reform their institutions of government, Australia cannot afford to allow Norfolk Island—as an integral part of Australia in the Pacific—to languish behind. Australia also has a national interest and responsibility to ensure that citizens and residents of Australia are not disadvantaged by systemic weaknesses in the existing governance arrangements.
The Senate select committee report from September this year noted that the Howard government considered a range of reforms relating to Norfolk Island in 2006; however, the cabinet, somewhat mysteriously, failed at that time to pursue them. The Senate committee recommended the findings of the 2003 and 2005 reports should be reconsidered together with its own recommendations, and that is what the government is now doing. Australia cannot afford to allow Norfolk Island to become a failed state, which is the likely outcome in the longer term if no action is taken.
Next week I shall visit Norfolk Island, not for the first time but for the first official visit in my capacity as the Australian government minister responsible for territories. The joint standing committee that has made so many reports already will visit next month. It is appropriate that ahead of those visits I advise the House of the government’s concern for the future of Norfolk Island. I will meet again with the Chief Minister and members of the Norfolk Island executive. I will also be meeting less formally with Norfolk Islanders to discuss some of the issues I have raised today. In the coming months I will take a long-term strategic policy to the cabinet which will have the aim of securing the future of Norfolk Island as a sustainable, just and equal part of Australia into the 21st century.
I ask leave of the House to move a motion to enable the member for Farrer to speak for 10 minutes.
That so much of the standing orders be suspended as would prevent Ms Ley speaking for a period not exceeding 10 minutes.
Question agreed to.
Thank you for the opportunity to respond to the statement by the Minister for Home Affairs about Norfolk Island governance. In summary, the opposition takes note of the minister’s statement; recognises the importance of this issue and the need for changed arrangements to ensure the future sustainability of Norfolk Island; does not propose a course of action but welcomes the opportunity to debate the way forward; and stands ready to work with the government and the people of Norfolk Island to achieve the best possible outcome for this unique people and environment.
In 1879 Joseph Campbell wrote a little account, Norfolk Island and Its Inhabitants, and I would recommend this as reading to anyone seeking an understanding of the origins and culture of the island. Campbell describes a small and exceptionally beautiful place, inhabited then by some 400 people, ‘about 250 who reside in the town, the rest in the small farms in various parts of the island’. There were excellent roads built by convicts, first-rate soils, thousands of lemon and guava trees, native flowers and, of course, the Norfolk Island pines. In those days there were a chief magistrate and jury running the island. Islanders had no taxes to pay but they gave one week’s labour out of every seven months to any public work that needed to be done. Before a person could settle on Norfolk, he needed to obtain the votes of two-thirds of everyone over 20 who could read and write, and the inhabitants were described as ‘very jealous of admitting people as members of their community’. Times have changed, and I now understand that some six-months residency is required and that somebody can move to Norfolk Island; it comes under the Australian Citizenship Act more broadly.
Norfolk Island is the only non-mainland Australian territory to have achieved self-governance. The Norfolk Island Act, passed by the parliament of Australia in 1979, is the act under which the island is governed. The Australian government maintains authority through an administrator appointed by the Governor-General of Australia. Four of the members of the assembly form the executive council, which devises policy and acts as an advisory body to the administrator. This council is headed by the Chief Minister of Norfolk Island. There is no income tax on Norfolk Island; the legislative assembly raises money through a duty on imports. The Norfolk Island government introduced a goods and services tax that is designed to broaden the revenue base. The GST commenced at a rate of nine per cent on 2 April 2007. Considering that the GST has only been in place for 18 months, the full effect has probably yet to show in the Norfolk Island economy.
You only have to flick through Norfolk Island’s telephone directory to realise what a unique place it is. Its phone book lists people by their nicknames. So many islanders share the same surname that it is easier to find them by the sometimes bizarre names their friends and family have given them. As the directory explains in the local creole, which is a mixture of old English and Tahitian words, the list helps you find people quickly by their nickname. Norfolk Islanders have demonstrated fierce independence over the years and even have their own customs service, stamps, international phone code and national anthem—God Save the Queen rather than Advance Australia Fair. I understand that being on the Australian electoral roll is not compulsory and that only about a hundred of the 1,800 residents are on one of our Australian electoral rolls. Australia is regarded by many islanders as a foreign country, and Australians have to bring their passports when they visit Norfolk Island.
Government ministers, various parliamentary committees and visiting Australians, as well as the islanders themselves, have over a long time documented the challenges faced by the islanders, so small in number and so far away from mainland services, with limited options to raise sufficient revenue and diversify an economy largely dependent on tourism. As one sentiment was expressed to me recently, everyone wants to reform Norfolk Island but the Norfolk Islanders just want to be left alone. There have been a number of reviews and economic feasibility studies. The November 2005 report by the Joint Standing Committee on the National Capital and External Territories suggests—and I emphasise suggests:
… the only sustainable alternative left for the people of Norfolk Island is the adoption of the taxation and welfare system of the Commonwealth of Australia.
The minister has stated:
The government takes the view that the model cannot be sustained in its present form—
and that a ‘growing proportion’ of citizens are ‘significantly disadvantaged in comparison’ to other citizens. He mentions, by comparison, a lower minimum wage on Norfolk than on the mainland and a lower threshold where eligibility for the pension cuts out. Given the non-taxed and barter nature of the economy, I do not know that these points are necessarily critical to the argument, but what I would say is that we must ensure as an Australian government that health needs, security, child welfare and care of the aged, disabled and vulnerable is provided on Norfolk Island to a standard that is acceptable to Australians generally. I appreciate that there is a difference between rural and remote areas and our major cities in Australia, but standards of health and welfare should be broadly comparable with the rest of Australia.
The minister has quoted the Hon. Grant Tambling and his remark that there is an ‘urgent need of governance reform’. As he is the island’s most recent former administrator, from 2003 to 2007, Mr Tambling’s views are relevant. In his submission to the Senate Select Committee on State Government Financial Management, he states:
… the island’s small population base (of now less than 1,800 permanent residents) constrains development opportunities and compounds problems caused by the community’s age-ing profile and international globalisation.
Mr Tambling believes:
… good governance … will only be achieved by aggressive and innovative actions in both public and private sectors.
If Norfolk Island were to receive funding according to the Commonwealth Grants Commission formula then they would, on a per capita basis, be much better off than they are now, when they receive only project support.
The opposition recognise the need for the Australian government to address the issues raised by previous committees concerning the sustainability of the Norfolk Island economy in the long-term interests of its people. I will not go so far as to describe it as heading towards being a ‘failed state’, as others have been quoted as saying. We look forward to further detail that the government may produce following both the minister’s visit to the island and the external territories committee’s visit. It is important that this process not be rushed. The government will, I am sure, carry out sound consultations with the island’s residents and will also recognise the considerable expertise within this parliament from previous ministers for the territories and members of relevant House and other standing committees: I name the Chief Opposition Whip; the member for Hinkler, who has a longstanding interest and is a member of the committee; Senator Ian Macdonald of Queensland; and, of course, the member for O’Connor.
A pragmatic approach does need to be taken, but this approach must be in the best interests of the islanders. We should all support the unique and special culture and history of Norfolk Island—as someone recently said to me, you cannot help but fall in love with the geography and heritage of the place—while reaffirming that no citizen of Norfolk should suffer financial and economic disadvantage just because they are resident there and not on the mainland. If—and it is early days in the debate—the decision is made to bring Norfolk Island in line with Australian tax and welfare systems, we should take a gradual approach and phase in new systems of governance, funding and taxation in order to avoid external shocks to the community and not disrupt the way of life or the expectations of Norfolk Islanders. But, as I said, it is only very early in the debate. It is the next generation of islanders whom we must look after. If the roads and buildings are in dire need of repair and renovation, services to the citizens are deteriorating, and workplace health and safety and welfare are a cause for concern, then let us put Norfolk Island on a sustainable basis for those who are children today but will be the community leaders of the next generation.