House debates

Wednesday, 13 May 2020

Committees

Corporations and Financial Services Committee; Reference

4:23 pm

Photo of Christian PorterChristian Porter (Pearce, Liberal Party, Attorney-General) Share this | | Hansard source

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I move:

That the following matter be referred to the Parliamentary Joint Committee on Corporations and Financial Services for inquiry and report by 7 December 2020:

Whether the present level of regulation applying to Australia's growing class action industry is impacting fair and equitable outcomes for plaintiffs, with particular reference to the following:

(1) what evidence is available regarding the quantum of fees, costs and commissions earned by litigation funders and the treatment of that income;

(2) the impact of litigation funding on the damages and other compensation received by class members in class actions funded by litigation funders;

(3) the potential impact of proposals to allow contingency fees and whether this could lead to less financially viable outcomes for plaintiffs;

(4) the financial and organisational relationship between litigation funders and lawyers acting for plaintiffs in funded litigation and whether these relationships have the capacity to impact on plaintiff lawyers' duties to their clients;

(5) the Australian financial services regulatory regime and its application to litigation funding;

(6) the regulation and oversight of the litigation funding industry and litigation funding agreements;

(7) the application of common fund orders and similar arrangements in class actions;

(8) factors driving the increasing prevalence of class action proceedings in Australia;

(9) what evidence is becoming available with respect to the present and potential future impact of class actions on the Australian economy;

(10) the effect of unilateral legislative and regulatory changes to class action procedure and litigation funding;

(11) the consequences of allowing Australian lawyers to enter into contingency fee agreements or a court to make a costs order based on the percentage of any judgment or settlement;

(12) the potential impact of Australia's current class action industry on vulnerable Australian business already suffering the impacts of the COVID-19 pandemic;

(13) evidence of any other developments in Australia's rapidly evolving class action industry since the Australian Law Reform Commission's inquiry into class action proceedings and third-party litigation funders; and

(14) any matters related to these terms of reference.

Many times opposite members recently have spoken about the importance of parliamentary scrutiny, and we're about to find out how real that commitment to parliamentary scrutiny is. The shadow Attorney-General told us very recently that parliamentary scrutiny was fundamental to the health of our democracy, and of course one of the great engines of parliamentary scrutiny is the parliamentary committee systems. One of the great parliamentary committees is the Parliamentary Joint Committee on Corporations and Financial Services.

The subject of the scrutiny with respect to this motion is the class action litigation funding industry. This isn't a matter of marginal importance and a matter where there are slightly unusual or unorthodox practices going on that can be simply explained. The things that are happening in the class action industry with respect to litigation funding are actually quite remarkable, and those things require some high degree of scrutiny by this parliament.

First and foremost amongst those things that require a high degree of scrutiny are the absolutely jaw-dropping financial returns that are routinely being reported in the class action industry fuelled by litigation funding. Those returns are absolutely inexplicable in terms of normal returns on any sort of regularised or institutional investment instrument, and they are totally without any precedent in the Australian legal sector. It's the case right now that with great regularity this industry is demonstrating outcomes that cannot be said to be consistent with the interest of justice of the litigants whose interests are supposed to be represented by the actions in question. In fact, so remarkable are the happenings in the class action industry fuelled by litigation funding that it is unfathomable, I think, that any person who professes a commitment to parliamentary scrutiny could vote against holding a multiparty parliamentary inquiry by a respected joint standing committee into the class action industry fuelled by litigation funding.

In fact it seems that the central argument of the shadow Attorney-General appears to be that the parliamentary inquiry by the joint standing committee would be an attack on people seeking to access justice. Leaving aside that that is not, nor would it ever be, the purpose of seeking further and better understanding through parliament of the remarkable occurrences in this industry, we simply want the committee to consider whether the outcomes that we are routinely seeing in the class action litigation funding fuelled industry are in the interests of the people that are meant to be represented. Are the operation of the class action industry and its outcomes consistent with principles of justice, and are they in the best interests of individual litigants? They are the questions that we are seeking to get answers, with respect to, by virtue of this parliamentary committee.

There are three broad issues that require scrutiny here. The first is an undeniable fact, and that is that better scrutiny and understanding needs to attach to the utterly remarkable growth that has occurred in the class action industry in Australia. The class action industry in Australia is growing at an unprecedented rate. Federal Court data shows that the class action industry filings have increased by 325 per cent in the last decade. Other reports have indicated that class actions have tripled in the last seven years across Australia. So there are, firstly, real and unanswered questions arising as to why this is happening and why it is happening at such a rapid rate. What are the policy settings and what have been the changes that might be contributing to that phenomenal growth in the class action industry? And what is the link between that growth and litigation funding? Without more, that is a legitimate and compelling line of inquiry for this parliament and its committee.

The second real question then follows is whether Australia's class action framework is in its real world operation and in real world outcomes actually working for everyday Australians; and whether the class action industry fuelled by litigation funders is operating optimally? Is it operating in the best interests of the plaintiffs whose interests it is supposed to advance? On this question, it's critical to note that much of the growth appears to have been driven wholly or substantively by the prevalence of litigation funders in the class action industry. They now financially underwrite a massive amount of the class action industry in Australia. They essentially operate as equity investment vehicles where the majority of class action is fuelled.

Between 2008 and 2012, 40 per cent of finalised Federal Court class actions received third-party funding. Between 2017 and 2018, 77 per cent of class actions finalised in the Federal Court were backed by litigation funding. In fact a pivotal point of policy change that appears to have coincided with that rapid increase in the activity of litigation funders in the Australian system was that the previous Labor government made the decision to exempt all litigation funders from any form of meaningful regulatory oversight in 2013.

In 2009 the full Federal Court of Australia determined quite accurately that litigation funders were in fact offering a managed investment scheme. The consequences of that decision would have been that such schemes would have ordinarily and in normal circumstances quite properly attracted sensible regulatory oversight under Australia's Corporations Law but for that 2013 exemption. So it seems a legitimate thing to inquire into the link between that exemption as a policy document and the growth in litigation funding in the class action industry. In fact, we would say that to deny parliament the opportunity to better understand that linkage—and to what extent that 2013 decision has come to create the remarkable circumstances we have now seen exhibited in this industry—would not be in the best interests of the parliamentary scrutiny to which the opposition say they so dearly and closely adhere.

The third issue is perhaps the most remarkable feature of the class-action industry and the involvement of litigation funders, and that is that there are eye-wateringly high returns being received by litigation funders. In fact, those returns are at times absolutely staggering when considered in light of the investment that was initially put in. They raise real questions which this parliamentary committee can seek to answer; namely, whether the staggering returns for litigation funders are coming at the expense of plaintiffs. And there is just more and more undeniable evidence of the profits that are being returned to litigation funders that requires parliamentary scrutiny. It actually means that less money ends up with the mums and the dads and the ordinary Australians who might be plaintiffs in a class action. We cannot deny this parliament, through its committee, the opportunity to inquire into that remarkable feature of litigation funding in the class-action industry.

The Australian Law Reform Commission found that the median return to members of litigation-funding backed class actions was 51 per cent. When the litigation funders weren't involved, the median return was 85 per cent. So litigation funders get involved and the median return is much lower—the people who are actually the plaintiffs in these matters are worse off. There is a growing body of evidence that something about the operation of the system around litigation-funded class-actions is, effectively, transferring enormous amounts of money from the pockets of everyday Australians and providing huge returns to litigation funders. Why would we not inquire into that phenomenon?

In fact, just look at what the courts have said. Completely independent assessments by our completely independent Australian courts have been increasingly critical of these returns to litigation funders. In a settlement reached last year in the case of Tredrea v KPMG Financial Advisory Services—that's a telling example—the class action against KPMG concerned advice given to shareholders during a takeover. It was brought by Piper Alderman, funded by Litigation Capital Management, in the New South Wales Supreme Court. The judge questioned the legal bill and fee and said the funder's 30 per cent cut was arguably excessive—he described it as stratospheric—and provided a return of tens of thousands of per cent when compared to the funds that were actually expended in the case.

There are now just too many cases where the returns to plaintiffs would leave ordinary Australians just scratching their heads. Why would we not scrutinise this? In the Murray Goulburn case, the class action was brought by Slater and Gordon in the Federal Court against Murray Goulburn regarding financial forecasts. The judge said the funder's 32 per cent commission was 'not fair and reasonable'. The court eventually approved a 25 per cent commission. That 25 per cent commission netted a 390 per cent return to the litigation funders, which was explained in their own half-yearly results. So that was a decreased return that still provided a 390 per cent return on the invested capital. In the CIMIC case, approved in April last year, a foreign funder and Maurice Blackburn took approximately 60 per cent of the settlement, leaving their clients to fight over the remainder. Unbelievably, the funder in that case originally proposed a commission payment of double what they actually got.

In 2014, in Fitzgerald v CLBL Insurance, 300 former employees of Huon Corporation sued for unpaid workers' entitlements. They received absolutely nothing from the final settlement. The entire $5 million settlement went to lawyers, administrators and the litigation funders. So bad was the injustice in that case, it prompted the National Union of Workers to make a submission to the Victorian inquiry into litigation funding. The National Union of Workers said in their submission:

It is clear to us that some form of market regulation needs to occur to prevent this result from occurring again.

Because they got nothing—nothing. Why would we not have these questions asked and answered by a parliamentary committee? What possible reason could there be for not asking and answering those questions?

There's a matter recently where a settlement has been proposed around PFAS and Defence bases in Australia, a settlement which many members of this government have worked very hard to ensure occurs. The proposal is to take more than $50 million in commissions, and the lawyers propose to recap $30 million in fees—so an astonishing 40 per cent of the settlement would be swallowed up in legal fees and commissions, leaving the class members to fight over what is left. One class member in that proposed PFAS settlement said, 'We're looking at a pittance. But the funder has made a fortune.'

So what possible reason could there be for opposing this type of scrutiny? In the shadow Attorney-General's press release, he says:

Litigation funding and class actions provide a vital path to justice for ordinary Australians …

He then goes on in the next paragraph to say:

Just last November the Federal Court ruled in favour of the three lead applicants in a class action of more than 1,350 women who sued Johnson & Johnson … for negligence.

That's correct. Nothing in this parliamentary process of scrutiny proposes an end to class actions or litigation funding; we want to know why the returns to the litigation funders appear to be so excessive. But what is wrong with this example—and I'll read it again:

Litigation funding and class actions provide a vital path to justice for ordinary Australians …

And then the shadow Attorney-General gives his prime example of litigation funding and class actions providing a vital pathway to justice for ordinary Australians being the Federal Court ruling in the Johnson & Johnson matter. The only problem is: it wasn't a litigation-funded matter. Now, that does seem to be something of a weak argument as to why you wouldn't have parliamentary scrutiny into litigation funders—I don't know who at bar chambers was researching that, but it was poorly done.

This has to be looked into. One foreign funder is reported to have raised $100 million recently, with a substantial portion of that capital earmarked to be deployed inside our class-action system in Australia against vulnerable Australian businesses arising out of the COVID-19 pandemic. Can you believe that?

Another litigation funder has recently pointed out to shareholders that, during a previous pandemic—this is what it's boasting about—that litigation funder's company share price actually grew strongly, rising by 164 per cent during the SARS outbreak in 2003. So we have a massive amount of evidence of excessive returns because of litigation funders' explosive growth in funding class actions. We see the warning signs of that equity investment vehicle being used here to drive litigation arising out of the COVID-19 pandemic. We've got a government who simply want a parliamentary committee to look into, inquire and ask and answer questions on this issue, and we have an opposition that opposes that motion for parliamentary committee scrutiny. Let's hear why.

4:38 pm

Photo of Mark DreyfusMark Dreyfus (Isaacs, Australian Labor Party, Shadow Attorney General) Share this | | Hansard source

I'll say again, although the Attorney-General has already read out from my media release yesterday, that litigation funding and class actions provide a vital path to justice for ordinary Australians trying to uphold their rights against wealthy defendants with vastly greater resources. I did give as an example in that media release yesterday when we saw this inquiry was about to be launched that, just last November, the Federal Court ruled in favour of the three lead applicants in a class action of more than 1,350 women who sued Johnson & Johnson and two subsidiaries for negligence in relation to pelvic mesh implants. These were hundreds of Australian women left in debilitating pain for years because of a faulty product banding together through a class action to achieve some measure of justice. Just like many, many litigants, they would not have been able to obtain redress and they would not have been able to obtain justice were it not for the class action process.

I waited through those 15 minutes of the Attorney-General's rant against class actions generally and against litigation funders to hear him refer to the government's own inquiry report which we have been waiting 17 months for a response to. That's the really pathetic thing about this hapless government—having commissioned the Law Reform Commission to do an inquiry into litigation funding and class actions, they have not yet, 17 months on, responded to the detailed recommendations of the Law Reform Commission report. That's because they didn't like the outcome.

Does anyone think it's a coincidence that this new inquiry into class actions—and, make no mistake, this is not confined to litigation funding; this is a general inquiry with very broad terms of reference into class actions as well—to be carried out by a government dominated committee was first proposed by the Attorney-General in the first week of March, just days after some 10,000 victims of the Morrison government's cruel robodebt scheme signed up to a class action to sue the government for the harm this terrible, illegal scheme inflicted on them? I'd remind the House that the robodebt scheme is not only cruel; the Federal Court has found it to be unlawful. Under that scheme, the Morrison government sought to intimidate innocent and vulnerable Australians into paying debts they did not owe. Perversely, the Morrison government has called this extortion racket an 'economic measure'. And now, rather than taking responsibility for its unlawful conduct, the Morrison government wants to make it harder for victims of robodebt to seek redress.

When Australian consumers are ripped off and injured by predatory companies selling dodgy financial products and dangerous consumer items, the Morrison government would also like to deny those Australian consumers any legal recourse unless they have millions of dollars lying around to pay for a legal action against a huge company with limitless legal resources.

There's been a lot of commentary in recent days about this proposed inquiry, and lots of dodgy statistics have been thrown around by those opposite and just today by the Attorney-General. But, contrary to government claims—and they need to listen to this—research by the commercial law firm Allens found that the total number of class action filings was actually down 20 per cent in 2019, and shareholder class actions, which the government seem to have a particular concern about, were actually down 63 per cent last year. So far this year—this is another matter that has featured in their publicity—we're only aware of three new shareholder class actions, none of which relate to COVID-19 matters.

Significantly, the biggest source of new class action cases in 2019 came from consumer actions arising from the banking royal commission, the same royal commission that the government voted against 26 times. The government had been crying for years that there was no point in inquiring into misconduct by the banks because there was nothing to see. But, to the surprise of nobody but the government, the inquiry revealed a litany of abuse by the big banks against their customers, against ordinary Australians who trusted them. The Morrison government then wrung their hands and cried crocodile tears, saying, 'How could we have known?' Then they got their marketing people into gear. The Prime Minister talked about a 'tough response'. This Prime Minister does like to talk tough, but he's delivered little more than a few focus-group-tested lines.

Now the Morrison government are delaying action again because they say they're too busy with COVID-19. But apparently they're not so busy they can't launch a new inquiry to stymie class actions against predatory companies, because, for them, that's a priority.

In opposing this inquiry, Labor's not suggesting that the legal regime governing class action proceedings is perfect. But we do not need another inquiry to tell us how to improve it. What we need is some actual governing by this hapless government and an actual response to the Australian Law Reform Commission inquiry that this government commissioned and which got one mention in the Attorney-General's 15-minute speech today. After a comprehensive inquiry lasting a year, involving consultations with some 60 key stakeholders, the Australian Law Reform Commission—

Photo of Mark DreyfusMark Dreyfus (Isaacs, Australian Labor Party, Shadow Attorney General) Share this | | Hansard source

Indeed, it was. It was a very long report. The Australian Law Reform Commission completed its 339-page report on class action proceedings and third-party litigation funders in December 2018. It was this government that commissioned that report, this government that received that report on 21 December 2018 and, in January 2019, this government that said that it would carefully consider each of the report's 24 recommendations and provide a response. So where is the government's response? You might have thought that the Attorney-General would provide it today, but it's nowhere—17 months and not a word. Why? Because that independent report by the Australian Law Reform Commission into the same subject matter as this new referral to a parliamentary inquiry didn't give the government the answers that it wanted. Even today the Attorney-General is not responding to the lengthy report of the government's own inquiry.

We've also seen that the government has tried to claim that this new inquiry is urgent because of the increased risk of shareholder class actions against listed companies for breach of continuous disclosure requirements during the COVID-19 crisis. But why then has the government ignored, for some 17 months, the 2018 recommendation of the Australian Law Reform Commission:

The Australian Government should commission a review of the legal and economic impact of the operation, enforcement, and effects of continuous disclosure obligations and those relating to misleading and deceptive conduct contained in the Corporations Act 2001 (Cth) and the Australian Securities and Investments Commission Act 2001 (Cth).

It's abundantly clear that the government's agenda in establishing this new inquiry is far broader and far more ideologically driven than the discreet issue of reform to the class action regime in relation to litigation funding or reform in relation to shareholder actions against listed companies for breach of continuous disclosure obligations, nor is the COVID-19 pandemic the reason for this government's inquiry. If they refer to it, it is simply an excuse.

If the impetus for this inquiry really was the narrow and specific purpose of responding to the risk of predatory actions against listed companies during the COVID-19 crisis, then Labor would, as always, be willing to engage in a constructive way, but that is not what this inquiry is about. So I say again, while Labor does not oppose sensible law reform and believes reform must be an ongoing task, the Australian Law Reform Commission completed a comprehensive report in relation to the matters that are the subject of this proposed parliamentary inquiry less than 18 months ago. What we now need is a comprehensive response from the Morrison government to the commission's 339-page report and to its 24 recommendations for reform. Labor does not support this government-controlled parliamentary inquiry created to stack the deck against ordinary Australians trying to uphold their rights in court.

4:47 pm

Photo of Stephen JonesStephen Jones (Whitlam, Australian Labor Party, Shadow Assistant Treasurer) Share this | | Hansard source

I move:

That all words after "7 December 2020" be omitted with a view to substituting the following words:

"whether the government has acted too slowly in implementing the recommendations of the royal commission into misconduct in the banking, superannuation and financial services industry".

We have an extraordinary situation unfolding in the chamber today where the Attorney-General, the First Law Officer of this country, brings to this House a motion calling for further scrutiny and further interrogation of an issue which has been subject to a report by the Law Reform Commission of this country.

We believe that there is a need for more sunlight, for more scrutiny and for more interrogation of reports that have been given to this government. We believe that there is a need—now, more than ever—for there to be scrutiny and interrogation of why this government has failed to implement the 76 recommendations of the Hayne royal commission. In fact, we are at 15 months, today, since the Hayne commission handed to the Treasurer and the government of this country 76 recommendations. How many of those recommendations have been implemented to date? Of 76, any guesses? Is it half? Is it half of the 76? Is it a third? Is it a third?

Mr Sukkar interjecting

I hear the assistant minister over there. Maybe he's informed. He is, after all, the Assistant Treasurer of this country. Perhaps he can give us a help as to how many of the 76. Well, it's not a half. It's not a third. It's not even 10 per cent. Six of the 76 recommendations have been fully implemented. And as we go into a circumstance where Australian households and Australian businesses now, more than ever, are requiring financial protections, are requiring greater oversight and are requiring that the recommendations of this once-in-a-decade royal commission be implemented, we've got the government playing parlour games. We've got the government delaying the implementation. We're not surprised; they did vote 27 times against the royal commission. They're dragging their feet on the implementation of its recommendations.

Now, people might be asking, 'What is the impact of the failure of the government to introduce these recommendations and to legislate for these recommendations?' Well that is, indeed, what an inquiry is needed for, but let me just give you an example of some of the things. We have just come through a season of bushfires, hail, and floods, and yet the government, through all of this, failed to implement the recommended changes to drag insurance contracts into the remit of the unfair contracts legislation. You'd think, at a time when households and businesses throughout the country, are struggling with their insurance claims, now, more than ever, they need the protection of unfair contracts legislation. You'd think that, when they are struggling to have their claims managed properly, we would have the claims management process, as recommended by the Hayne royal commission, brought within the regulation of the Australian Securities and Investments Commission. These are the sorts of things that the government has dragged the chain on.

Over 16,000 vulnerable Australians have been sold a dud funeral insurance product—that is, a product that they will most likely never get to claim on and a product in which they are paying more in premiums than they will ever be able to redraw in terms of a benefit. It's still lawful to be selling these products, because the government has done absolutely nothing to implement that recommendation of the royal commission. There is actually a bit of a war going on in social media today, because the hapless assistant minister for financial services has failed to convince her own side to introduce legislation to reform financial planning legislation in this country.

It's extraordinary—absolutely extraordinary. A decision was made in August last year to make some reforms to the education arrangements for financial planners, agreed to by Labor. The bills were introduced into this House in February, yet here we are in May and they still can't get the legislation through the Senate. If they can't get this sort of legislation, which has bipartisan agreement, through the Senate, how on earth are they going to get legislation through a parliament where there's disagreement? This is an absolute joke. They are trying to shed blame home to Labor because of their own hopeless management, and they can't organise a legislative agenda.

This is the sort of government we are dealing with. The Prime Minister stood here yesterday and said that we need to instil confidence in Australian business and the Australian people. Well, one way of instilling confidence in the Australian business community and the Australian people would be to legislate the recommendations of the Hayne royal commission. That is now 15 months overdue, and we have implemented only six of the 76 recommendations. Labor says that this is a matter worthy of interrogation and investigation. If the government wants to spend some time inquiring into something, then how about we have an inquiry into this?

Instead, for reasons best known to themselves, they've decided to launch yet another inquiry into class actions in this country. But I tell you this: they are no friends of consumers, and they are no friends of ordinary battling men and women who have struggled to have their legitimate complaints against unfair product distribution in this country dealt with. If you're a poor, struggling small business, if you're an ordinary consumer, the only way you're ever going to get your day in court is if you can join with other members in a class action and have the ability to pool your resources and have your day in court. Make no mistake about it: this motion and this inquiry is designed to rob those consumers—ordinary battlers, whether a small business or an ordinary consumer—of their ability to pool their resources and join in a class action to have their day in court. It's extraordinary. At a time when there are so many challenges, the government decides that this is the most important thing they need to bring before the House today.

So, we call on all members of this House to reject the proposition put forward by the Attorney-General and vote instead for the amendment moved by me and seconded in this place to ensure that we can have a proper inquiry into the things that are needed, and that is the government's failure to implement the recommendations of the Hayne royal commission. I will say it again, because members in this place need to know this. In the middle of an economic and financial crisis, after sitting on the recommendations of the royal commission for 15 months, just six of the 76 recommendations of the Hayne royal commission have been implemented. This is not an A. This is not an A minus. This is not a B. This is not a C. This is not a D. This is an F—a capital-F fail. The people of Australia deserve better than that. If this government had any pride, instead of moving this silly motion before the House today they'd be coming into the House and explaining why they have done such an appalling job of doing what they committed to do when they received that report. The right thing to do is to reject the proposition put by the Attorney-General and vote instead in favour of the amendment I have moved.

Photo of Andrew WallaceAndrew Wallace (Fisher, Liberal Party) Share this | | Hansard source

Is the amendment seconded?

4:56 pm

Photo of Matt ThistlethwaiteMatt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Assistant Minister for Financial Services) Share this | | Hansard source

I second the amendment. This government will go for anything to avoid scrutiny around the royal commission and the implementation of the recommendations of the royal commission. What's more important to the average Australian: an inquiry into corporate litigation funders, or looking at why this government is dragging its heels and not delivering on the recommendations of the Hayne royal commission? These are recommendations that affect and have the potential to affect the livelihoods of millions of Australians. Anything to avoid scrutiny regarding the royal commission.

We all know that this government has form when it comes to the Australian public getting a peek into what's actually going on in financial services in this country, being provided a bit of sunlight into what's been going on in the corporate world in this country and some solutions and recommendations. It was this Prime Minister and this government that voted 26 times against the establishment of a royal commission into banking and financial services in this country, because they didn't want the Australian public to know exactly what happened in this industry. Millions of Australians were ripped off in the banking and financial services sector over the course of the last decade, yet this government voted on 26 occasions to deny a royal commission into what was really going on in that industry. It happened only when the banks actually rolled over and wrote to the then Treasurer, as he was—the now Prime Minister—and said: 'You know what? It's okay; we'll have a royal commission.' They saw that the public outcry about what was going on in banking and financial services was too much, that it was doing damage to their business model, and they agreed to a royal commission into banking and financial services. It was only when they rolled over, when the banks gave the Prime Minister—the Treasurer, as he was then—the tick of approval to move into an inquiry that they actually got on with it. It wasn't anything to do with looking at what was actually happening in the industry. It wasn't anything to do with dealing with some of the problems and actually looking at what the problems were for the average Australian mortgage holder or the average Australian bank customer or someone who has shares in a particular financial institution. No: it was because the banks gave the government the green light to launch the royal commission.

In the words of the royal commissioner, some of the most shocking greed and unconscionable conduct in financial services in this country was uncovered through that inquiry; 76 fulsome recommendations were made about what needs to happen to restore confidence in banking and financial services in this country. What's been the government's response to date? Well, only six of those recommendations have been fully implemented—a shocking record. Almost 18 months after the inquiry findings were handed down, and with the urgency attached to those recommendations in many respects—urgency recommended by the commissioner—the recommendations haven't been dealt with. Only six of them have been fully implemented.

The royal commission uncovered some shocking behaviour. We all remember what went on in the Commonwealth Bank in the wealth management scandal that was uncovered by the Commonwealth Bank. The regulators missed that. It took whistleblowers actually walking into the offices of ASIC and demanding that they conduct an inquiry into what was going on in the Commonwealth Bank before anyone acted. No-one on that side took up the issue on behalf of the people who were being ripped off by the Commonwealth Bank at the time. It took whistleblowers to actually walk into ASIC and to get the media involved before anyone actually saw what was going on in banking and financial services in this country. Then we followed it up with CommInsure. We saw what was going on in the insurance industry, particularly around life insurance, and some of the outdated definitions that were being used in this country.

Of course, it went beyond the Commonwealth Bank. The regulators decided that it was time to look beyond the Commonwealth Bank and see what was actually going on in some other banking and financial services areas of the economy. This uncovered the fact that this wasn't peculiar or unique to the Commonwealth Bank. It was happening across all financial services in this country. We saw the fees-for-no-service scandal and all the other big four banks and many other financial institutions dragged into the financial services mess in this country at the time. That was what was going on, and that was being ignored by this government when they voted 26 times to deny a royal commission.

Many of these recommendations contain comments from the royal commissioner about their urgency—the fact that they should be implemented and legislated as quickly as possible. Yet this government is still dragging its feet, with only six of those recommendations being implemented. Some of them relate to really important legislative changes that will provide important support and protection for consumers in Australia. They relate to things like best-interest duty for mortgage brokers to make sure that our mortgage industry and people who are seeking to buy homes are protected in this country. Then there are unfair contract terms in financial services and insurance contracts throughout the country. We've seen some of that recently in this pandemic. It's vitally important that protections for consumers, around unfair contract terms in insurance contracts, are implemented as quickly as possible.

We've seen over the course of this pandemic that some insurers have tried it on, if you like, in terms of reducing coverage for people relating to the pandemic. One of those areas was trade credit insurance. A particular insurer was looking to cancel or reduce trade credit insurance policies related to the pandemic. It was only after the opposition asked questions and highlighted this in the media that they backed down and changed their policy on that. If you had in operation an unfair contracts term regime in the insurance industry, some of those events may not occur.

The royal commissioner saw that the sale of add-on insurance was a key issue in people being ripped off around insurance contracts throughout the country. There was urgency associated with that. That still hasn't been implemented. The changes to funeral insurance that were recommended still haven't been implemented. And the list goes on.

Many of these important recommendations of the banking royal commission still have not been implemented by the government. They're dragging their heels on it, yet they come into this parliament wanting to refer this to the Parliamentary Joint Committee on Corporations and Financial Services. It's really a ruse for an issue that's not a big issue and has actually ensured that many Australians have access to justice when they otherwise wouldn't have access to justice because they can't afford the cost of litigation in taking their case against large corporations in this country. The shadow Attorney-General has pointed out some cases where that's very important.

What's more important to Australians: looking at corporate litigation funding or why this government is dragging its heels on dealing with the recommendations of the banking royal commission? I know what most people in my electorate think. They want action on those banking royal commission recommendations. They want to know why, after 18 months, only six of the 76 recommendations of the banking royal commission have been implemented by this government. They want to know why, after those very strong words in that report from the banking royal commissioner, they still don't have adequate protection from fraud and misconduct in banking and financial services in this country.

We all know why. Because the government's heart is not in it. Their heart has never been in it when it comes to the banking royal commission. They voted against it 26 times and they voted against ensuring scrutiny of banking services in this country. Now they're dragging their feet on delivering those recommendations and ensuring that Australian consumers get the protections that they deserve. That is why members of this parliament should support the amendment moved by the member for Whitlam.

5:05 pm

Photo of Meryl SwansonMeryl Swanson (Paterson, Australian Labor Party) Share this | | Hansard source

I want to bring a human face to this. I actually want to pay tribute to the Attorney-General as he exits the chamber. He was the first person in this hapless government to provide some urgency and action surrounding the PFAS class action that my community had endured for years before they saw any action. It was a mess. The member for Pearce, the Attorney-General, knows that it was a mess. I can take you back to 2015, when my community first learnt that their ground, their bodies and the very water that they drank had been contaminated by perfluoroalkyl substances. These things are commonly known as foams. When they were used, they were used in good conscience by the Defence Force in the hope of putting out plane fires. A plane fire burns at over 800 degrees Celsius. It's not an easy thing to extinguish. When they decided they would use these chemicals that were developed by DuPont and 3M over the years, they anticipated that they would save lives, not knowing that these chemicals, which form very strong carbonate chain bonds, are incredibly difficult to destroy. They are now known and tagged as the forever chemicals.

When my community learned that the forever chemical PFAS was in the ground, in the water and in their blood, they could not believe it. The Newcastle Herald ran a story on 4 September 2015—'Contaminated'. Skull and crossbones littered the front page, and my community panicked. Professional fishers in the Hunter River—the mighty Hunter—were banned from fishing. People were told, 'Don't drink your water, don't eat the eggs from your chickens and, whatever you do, look after yourselves.' It was deemed the red zone; it was a catastrophe.

And from that point forward my community fought. They fought their own government. It was through no fault of their own—they hadn't done anything wrong. It wasn't as if they'd read the bottle and hadn't followed the manufacturer's instructions; it was none of that. They had woken up one morning into a nightmare of a life, where they'd been poisoned by their own government—by the very agency that was tasked with their defence. They had been let down over decades—not just one, two or three months; we're talking about a span of 30 years where this accumulated in the ground. They could not seek justice. They were absolutely determined that they would win.

Do you know what they did? They organised a class action. They were the first group in Australia to do so. They had the wit, the wherewithal and the determination to organise themselves, and they did. They sought a funder. They sought litigation funding to help them fund their class action, because they knew they couldn't go up against the might of the Defence Force and the Australian government. They needed help, they looked seriously for that help and they got that help. It has taken four long years, but just in the last few months, under a mediation, they have been able to negotiate a settlement.

I can say that if it weren't for Dentons, who were formerly Gadens, who ran their defence, and IMF Bentham, who funded them—the litigation funders—that class action would never have got off the ground. Those people spent months, weeks and hours in the homes of our class action members. They worked absolutely tirelessly for my community and they continued to prosecute the case. Right up until the eleventh hour they dragged the Defence lawyers to the mediation table. I stood—not here, but in my regular place—in parliament and asked this very question of the Prime Minister: when are we going to see justice for the people of Williamtown? He looked me in the eye and said, 'The member knows well that we are in mediation at the moment.' It was that mediation through a class action which saw ordinary people get some justice which was so sorely overdue for them. So when I come into the chamber today and hear the member for Bradfield shouting, 'Oh, you're friends of litigation funders,' do you know what? In the instance of my community and PFAS, I am, because without those funders we would not have been able to see justice for the ordinary people.

And I want to speak about some of these ordinary people. One man, who I won't name, was just incredible. He came to me and said: 'Meryl, I saved my whole life to get a few acres. All I wanted to have was a lemon tree, like my grandma had, and half a dozen chooks, and I love to grow my own vegetables. I've worked hard all my life; I've hardly taken a sickie and I've done that: I've been able to buy five acres. I've got a lemon tree, I've got my chooks and I've got my veggies. And now I can't eat the eggs, I can't have juice from those lemons and I can't grow those vegetables. My property is worth nothing. No-one wants to buy it and not a bank will lend a dollar.'

Another story: again, it's about chickens. It's amazing, I know that everyone is getting into chooks at the moment with COVID-19! I was at the regular little shopping centre in Raymond Terrace, and a young girl was sitting there. It was one of the school nights—a Thursday night. She had a bag of chicken food on the table at the food court with her mum and dad. I came up and said: 'How are you going? You've got your chook food.' She said, 'Yeah, I've got my chook food, Meryl.' I said, 'You must love those chickens.' She said: 'Yeah, well, I feed them but we can't eat the eggs and I don't want dad to chop their heads off. But I know it's expensive to feed them.' This was a young girl in primary school, saying to me: 'I've got my chickens, they're still pets. We don't want to kill them but we can't eat their eggs anymore.'

Those are just two tiny examples of how people's lives were fractured. They've been decimated by what we would consider to be a shameful act. But they still couldn't get justice from their own government. We went through Ministers Payne, Pine and Price, and then it got flicked to the Prime Minister's office. Then we had a task force and two inquiries, with very legitimate recommendations. That was all cast aside—all turned asunder. No-one would listen to my community. But let me say that when the lawyers came knocking and the class action kicked off, that government over there sat up very straight and took a lot of notice. They came with their chequebook in the end, because they knew they were facing the scales of Madam Justice, and those scales of justice were tipped well against them in this instance.

So it's the hide of this government to come in here and try to rip the carpet out from under justice and say, 'Oh, we really need to check this out.' My goodness me! The temerity of a government that cannot understand when ordinary people need to the fight. Labor takes up the fight for ordinary people. I've taken up the fight for the ordinary people in my electorate who wanted extraordinary justice.

Opposition Member:

An opposition member interjecting

Photo of Meryl SwansonMeryl Swanson (Paterson, Australian Labor Party) Share this | | Hansard source

I hear my colleague saying that I'm incandescent with rage! It is one of my favourite sayings when I really am incandescent with rage! To anyone who has ever—no, I won't say that word in the parliament, so I'll say something else! It's to anyone who has ever been treated poorly by a power bigger than they are—by a bank, by a government department or by a big company—and think that there is just no way they'll ever get justice. Do you know what? Sometimes class actions get justice. We see that now with the member for Maribyrnong helping with a wonderful class action about robodebt. We know that tens of thousands of people felt that they had been wronged, and now thousands of people have signed up for that class action.

This government doesn't like class actions because class actions represent the little people getting their foot in the door of the big end of town. Class actions represent the little person being given a chance to see their rights in the spotlight. And maybe they do get a little bit of recompense and maybe the litigation funders do get to make some money from the hours and work that they've put in. But, at the end of the day, justice prevails. When people get their day in court, they feel as though they have been heard and taken notice of. This government only takes notice of what it wants to take notice of, and I say: let them take notice of what we're doing now. (Time expired)

5:15 pm

Photo of Bill ShortenBill Shorten (Maribyrnong, Australian Labor Party, Shadow Minister for the National Disability Insurance Scheme) Share this | | Hansard source

I rise in support of the amendment. Australians who are listening to parliament and the debate at the moment must be thinking, 'Surely the government must have a reason to refer class actions and the way in which some of them are funded to a parliamentary committee. And, on the surface of it, isn't it good to always ask questions and examine how things happen?' But, listening to the Attorney-General suddenly find religion about the need for transparency in parliament, I have to say that that immediately started to make me suspicious. This is a government that doesn't want parliament to sit despite Labor doing everything it can. This is a government that wants teachers to be teaching and wants everyone to be back to work, except themselves. They want to wait until August. So, when I hear the Attorney-General say that they want more transparency, I become suspicious. I say to the Australian people in relation to this debate: this is a government which doesn't want parliament to sit, doesn't believe in a national anti-corruption commission and already has a Law Reform Commission report on the very matter that it wants to take up parliament's time with, even though it hasn't done anything with that report for 17 months. And now, all of a sudden, this government has found religion on class actions.

I think it is warranted to look at the circumstances which have resulted in this sudden 'on the road to Damascus' conversion by a government that notoriously doesn't support an anti-corruption commission and has done nothing on that, and doesn't support the parliament resuming before 11 August unless Labor, the media and the people put such pressure on that you will be able to see their fingernail marks on the marble of the parliamentary hallways as they're dragged into parliament. All of a sudden they are outraged on behalf of ordinary Australians because they don't like the way some class actions are funded. Again, the Attorney-General got my hackles up when he said, 'This is a situation in these class actions where money is being transferred from Australians to lawyers or litigation funders.' First of all, class actions are promoted by people who don't have the means to seek recompense or justice in their own right and they're actually seeking, in the case mentioned in the member for Paterson's fantastic contribution, to have their environment and their land cleaned up, their house values addressed and to be compensated for the mistakes of government.

There's another class action underway at this very moment which is not funded by litigation funders, but this government is resisting. So, on the one hand, they want to have an inquiry into class actions; on the other hand, when confronted with a class action, they don't want to settle the matter even though they've already conceded liability. For the benefit of Australians who are listening, I mention that the matter to which I refer is called, for want of a better expression, the robodebt class action. A conservative government has, for a number of years, used a computer algorithm to assert that hundreds of thousands of Australians owed debts to the Commonwealth without any evidence other than a computer program saying, 'You owe the money.' This program has proven to be faulty, but it took years and years for the government to listen to reports of the faults in the system. In the intervening time, people took their own lives due to pressure, according to the parents of people who received the debt notices. Thousands of people have had their reputations besmirched by an unjust enrichment scheme run by a government that think they can get away with sending letters of demand to poor and vulnerable Australians because they think these people can't stand up and fight back.

Now it's been exposed through documents leaked to The Guardian Australia that this government and its cabinet has already this year and late last year deliberated on what to do about a class action which was launched by Gordon Legal seeking recompense for tens of thousands of people. The government has said in these documents that 449,500 refunds are in the scope of the faulty system and that they're going to investigate 80,000 of these to see if money is owed. They're not even disputing that the hundreds of thousands of others within this collective cohort of 450,000 unjust enrichment claims made by the government are wrong. They accept that hundreds of thousands of claims are wrong, but they only accept that because of legal action—and it's not through the class action alone. The Victorian Legal Aid Commission did a great job running the initial cases, but this government obfuscated and denied responsibility for invalidly raising debts against hundreds of thousands of Australian citizens. Australians listening to this parliamentary debate may say, 'Why has this matter burned so brightly?' Labor believes that this government cannot be trusted when it comes to plaintiffs and victims asserting their legal right to compensation from vested interests, from government and from people who have taken advantage—through product negligence, through the unjust enrichment of this government or, in the case of the PFAS class action, through the contamination of land. When I hear the Attorney-General say that, as a matter of principle, he is against transferring money from Australians to vested interests, I ask: then why on earth have they taken four years to concede that robodebt is wrong and why on earth are they now saying they shouldn't have to pay interest on the money they've taken from Australians? When you owe the tax office money, the tax office charges you interest, but this government, which has unjustly enriched itself and taken money from ordinary, vulnerable citizens, has said in the leaked document that they're not going to settle a class action if they have to pay interest to the victims. The case of robodebt is not a class action that is funded by litigation funders. We've got a lot of people in the government who say they're the true libertarians and they believe in small government, yet they have said nothing about the government robbing the people. And that's what robodebt was. It was an abuse of power. Invalid debts were raised by the Commonwealth against hundreds of thousands of Australian citizens. Is this government so lacking in shame that it thinks it can simply get away with perpetuating the raising of invalid debts against hundreds of thousands of vulnerable Australians?

I heard the Attorney-General say that what motivates him to make this great point of principle about having an inquiry into class actions is that he doesn't believe in the transfer of money from ordinary Australians. What on earth have he and his colleagues been presiding over for the last four years if not the unfair transfer of money from ordinary Australians?

The robodebt class action is due for mediation on 4 and 5 June. A hearing is set down for 20 July. If the government really believe they don't want to line the pockets of lawyers, if the government really believe they don't want to see unjust enrichment against Australians, why won't they release the advice that they're relying upon? Why won't they resolve and mediate the matters with the tens of thousands of people who they've ripped off? Why are they insisting on going through a court process on the basis that they don't want to pay interest on moneys that were unjustly enriched. Why is it that they stubbornly insist on taking it to court and forcing a class action when they cannot concede negligence in the matter?

I would say to Australians listening to this debate: do not trust the government when they say they want scrutiny, because in fact their record indicates anything but scrutiny. They don't support reform of electoral donations, they don't support doing anything meaningful about a national anticorruption commission, they didn't support the banking royal commission, they don't really want parliament to be heard and they don't like the idea that Australians without great financial resources can use the mechanism of a class action to seek justice. Time indicates to us, bitter experience has taught us, that unless you stand up to this government they'll run right over the top of you. Robodebt was running over the top of people for four years. Addressing it took individual citizens, legal aid commissions and, now, a class action.

When the government say that that they're interested in transparency, you know that it's only the case when they've been forced to, or when they're on the back foot, or, indeed, when they don't want you to look at what they're really doing. Before they put their referral up, they should resolve the class actions which are underway. They should seek settlement with the people of Australia from whom they've unjustly enriched the coffers of the government.

5:24 pm

Photo of Peta MurphyPeta Murphy (Dunkley, Australian Labor Party) Share this | | Hansard source

It is almost beyond comment that today we have an Attorney-General supporting an inquiry into class actions with an argument that is somehow about parliamentary scrutiny and integrity, when the Manager of Opposition Business had to stand up and correct the record because the same Attorney-General misrepresented him in the parliament. It's galling. If it hadn't happened in front of all of us today, I'm not sure any of us would believe that anyone would have the gall to act in that manner.

If the Australian people want to know why class actions matter, I'll give them one word: asbestos. How many Australians had to suffer with mesothelioma? How many Australians didn't have anywhere near the financial resources, on their own, to take on the giant legal firms, let alone the manufacturers of asbestos, and couldn't have done it without a class action?

I'm proud to be on this side of the parliament in a party of people who stand up for, and have a history of standing up for, those people who need to be represented. If the government actually cared about reforms to the legal sector, if they cared about having a legal sector that looked after vulnerable people the most, then instead of taking up time today with this ridiculous motion and a pretence of caring about parliamentary scrutiny they'd spend a lot more time working out how to give greater systemic support to community legal centres and Legal Aid centres across Australia. It's not enough, in a time of a pandemic, to say, 'At the moment we'll give you some more money,' but then leave a sector that looks after the most vulnerable Australians scratching day to day for enough resources to do what it does.

In my professional career before coming to this place and now as the member for Dunkley, I have seen over and over again what community legal centres do for the most vulnerable in our community, for the people who are most in need. If we want to talk about doing something really important during this pandemic, something that would contribute to an Australia that is better at looking after the most vulnerable once we're through it, we should look at how we can give long-term support to community legal centres like the Peninsula Community Legal Centre. It has continued to work outstandingly long hours to support people in Frankston and the broader Bayside and peninsula area when they've been stuck at home with partners who are violent, with little to no opportunity to get out and get advice about their legal rights, because of the social restrictions. It has supported people when they've lost their jobs and haven't been able to pay the rent, month to month, and they don't know what to do and they need legal advice. It has been there when people's businesses, which they've built up over 25 to 30 years and which have been the heart of themselves and their families, have been destroyed in the blink of an eye. Those people have never thought before that they would need to access government support and have nowhere to go. The Peninsula Community Legal Centre were there for them.

When people who have been homeless long term on our streets, with mental health issues and other health issues, and they have had to work out how to protect themselves from coronavirus—when they're told to socially distance and that the best thing they can do is stay at home, but they have no home to go to—who have they turned to for help? The Peninsula Community Legal Centre. When people have had to go to court during this time, and they can't leave home to go and meet with a lawyer to get advice, who have they turned to for advice and representation? The Peninsula Community Legal Centre.

If the government wanted to do something to address the fact that in our communities too many young people go straight from the residential childcare system to the juvenile justice system and the criminal justice system, we'd be looking into that. We wouldn't be having motions for referrals to inquire into class actions where battling Australians are able to band together to take on the big giants that they couldn't do on their own. If we had an Attorney-General that really cared about parliamentary scrutiny then he wouldn't have shut down the Leader of the Opposition every time he moved a motion to discuss something that the Prime Minister doesn't like. If we had an Attorney-General that really cared about parliamentary scrutiny then he'd make sure that his government responds to recommendations of royal commissions and responds to recommendations of parliamentary committees when they hand down reports and implements them. But instead we have a culture warrior who wants to stir up controversy, who thinks that perhaps this is a good way to have a whack at those law firms who stand up for people that need someone in their corner when they need it and it does a disservice. It does a disservice to our democracy, it does a disservice to this parliament and it does a disservice to this government.

We should be here talking about the parts of the legal system and the justice system that don't that work for the people who need them. We should be here talking about long-term systemic reforms, which include proper funding to legal aid commissions, to community legal centres, to all of those pro bono services out there that are helping domestic violence victims, people who can't find affordable housing, people who at the moment can't work out how they're going to feed their children, people who need to go to VCAT to challenge a government decision that was ultra vires—to challenge a government decision which has caused them deep and ongoing pain—but they can't afford to do so. That's what this place should be talking about. That's what our responsibility is.

It should be to the never-ending shame of the current Attorney-General that that's not what his focus is all the time, let alone now when all of those issues aren't bubbling below the surface. They're on top of the surface. All of these issues aren't just the sort of communities that Labor people represent, who have long-term and systemic disadvantage, all of those issues are being faced by people who never thought that they would face them in their lifetimes.

Everyone should be equal before the law, but we know that the law doesn't always treat people equally. We cannot have a system where people who have money and resources get the benefits of a legal system and people who don't have money and don't have resources don't. That's why we have class actions, that's why we have community legal centres, that's why we have legal aid commissions and that's what we in this place should be looking to support.

5:33 pm

Photo of Mr Tony BurkeMr Tony Burke (Watson, Australian Labor Party, Shadow Minister for the Arts) Share this | | Hansard source

It's rare that you get a debate on a committee referral that in fact brings together the differences across this chamber in such a cohesive way. Effectively what we're dealing with here today are two different approaches as to what should happen for the same parliamentary committee. Those two different approaches are saying, 'Let's look at two different issues.' Both issues involve victims. The first deals with victims of the banking industry. The second deals with victims from a range of different circumstances where were it not for litigation funding arrangements they would never get access to justice. It just wouldn't happen for them. We're dealing with those two areas and they're both about victims. In both areas reports have already been done and in both areas the government doesn't want to implement the recommendations of those reports.

This afternoon—through two votes that will come up before we finish tonight—the government is effectively going to try to bury two reports. They're going to try and bury the banking royal commission report and they're going to try and bury the Law Reform Commission's report into litigation funding. Given that that's what they're going to do isn't it interesting the way the Leader of the House, in his capacity as Attorney-General, commenced this debate? His words were: 'We're about to find out how real that commitment to parliamentary scrutiny is.' You bet he's right. Never have truer words been spoken and it's not that often that true words have been spoken by this bloke of late. You'll think there'll always be a whole lot of members of parliament here who don't really like the chamber much. Ordinarily one of those people who really hates the parliament is not made Leader of the House. That's new ground. To vote against the House sitting, in additional sittings, and to vote against giving us a new sitting calendar, which should've happened this morning—in that vote, okay, the government had a position. In making the case against my amendment the Leader of the House couldn't come up with an argument against the House sitting without abusing the forms of the House and misrepresenting me and misrepresenting a meeting that his own Prime Minister was present at.

I'm not precious about it because I was the one speaking, but in terms of the forms of the House there are protocols that have been around for a long time and I've always observed them. If I'm going to get stuck into a member of the other side in a speech and they're not likely to be in the chamber—it's an adjournment speech or something like that—I always pick up the phone and let them know. It's a longstanding tradition in this place. You don't hold back. Often they don't want to come into the chamber for it but you let them know it's happening. The exception, of course, is whatever happens in question time or immediately after question time, because there's an expectation that all members will be here. That's why that's when we normally raise issues of misrepresentation.

In terms of the disrespect to the importance of the democracy of this place, I thought it was breathtaking today that, as the Leader of the House was being called out for misleading the House, he walked out of the chamber. In terms of how this place is meant to run, that's just extraordinary. I thought that would have been his peak moment of hypocrisy for the day, but I'd underestimated him. I'd underestimated him badly because we were told, at the beginning of his speech, that we were about to find out how real the commitment to parliamentary scrutiny is. How true those words are. The Law Reform Commission has already reported. Let's not forget that, when the government wanted to set up that Law Reform Commission inquiry, when George Brandis was doing it, they were doing it with an eye to, 'How can we clamp down on litigation funding?' But they didn't get the report that they wanted. So this reference is not about scrutiny; it's about burying scrutiny. It's not a reference to find out what's going on; it's that they got a report they didn't like so they now want a report they can control, and a House of Representatives committee is a committee they can control. So the whole purpose of the inquiry and the reference that's been moved today by the Attorney-General is that the government, some years ago, asked for scrutiny, they got it and they didn't like it and so now they want this reference to get rid of the scrutiny that happened so that they can have a different committee report to refer to. This is where the real test is that we need to apply to this government and the job that they have. All these reports mean nothing if you don't implement them. The government's reference is entirely to prevent the Law Reform Commission recommendations from ever being implemented. That's why they are making it. It's to get rid of the Law Reform Commission and to make sure those recommendations are never implemented.

Similarly, they are going as slowly as they can on implementing the recommendations of the banking royal commission. The member for Whitlam has already referred to this—of the 76 recommendations, six have now been fully implemented. In terms of the job of this parliament, if the test is scrutiny, what should we be doing? Should we be making sure that recommendations, once given, are implemented, or should we be burying recommendations?

The Labor amendment moved by the member for Whitlam and seconded by the member for Kingsford Smith aims to do one very simple thing. There is a report from the banking royal commission, a commission that the government resisted. I remember being here on that one night when we took control of the floor. I remember the different members of parliament, including the now Prime Minister back when he was ambitious for the then Prime Minister, making sure that they kept the debate going as long as possible while they tried to get back the members who'd gone home early. Incidentally, one of them was the Leader of the House. They did everything they could to stop the royal commission from happening, and now, when asked about it, the Prime Minister says, 'Oh, well, I initiated it.' Well, it's not much good if you don't want to implement it.

The other job that this parliament could be doing is to take the Law Reform Commission recommendations and have a mechanism to try to make sure that they never happen. So we have a choice. Do we believe any of these reports matter? Do we believe we should ever be adopting and implementing recommendations that are given to us, or should the government, effectively, be able to control what recommendations are given to it and, if it doesn't like what comes to it, it can go out advice shopping?

If the Labor amendment is carried, there will be scrutiny in this parliament. If it is defeated and the government motion is carried in its original form then the scrutiny that was done by the Law Reform Commission will be buried. So, at a time when the government have been trying to stop parliament from sitting, when it does sit, they have made sure that on any occasion when the Leader of the Opposition seeks leave to move a motion that leave is not given—unprecedented already. Then, if he moves that standing orders be suspended, they immediately move that he be no further heard. This parliament at the moment is less than it's ever been. It really is. And that's through an active decision of the Prime Minister of this country and the Leader of the House. We're about to decide whether we want to make it even worse. Do we now want to use our committees for scrutiny or for burying scrutiny? That's the decision the parliament's about to make.

5:43 pm

Photo of Patrick GormanPatrick Gorman (Perth, Australian Labor Party) Share this | | Hansard source

We should have seen the Leader of the House come in and move to have a clear plan for sitting days for the rest of this year. That is, clearly, the No. 1 priority that he should be fulfilling in his role as Leader of the House. Instead, we got a referral for an inquiry that it's clear that a number of members of the government have already prejudged. We have read in the paper that they already have a very firm view on this matter. This is not a matter that the government actually need to hold any form of inquiry into. They're simply prosecuting their own view about denying certain members of our community access to justice.

As the member for Dunkley said, we should be having a discussion about more support for legal aid. We should be having a discussion about more support for organisations like the Consumer Credit Legal Service based in my electorate of Perth which services all Western Australia, making sure that Western Australians can assert their legal rights. As the Manager of Opposition Business just pointed out, there is already a 339-page report on a number of the matters which the government is seeking to engage the committee on which I serve to inquire into. That is a committee that already has a large schedule of work ahead of it. Indeed, it is a schedule of work the committee has been delayed in completing, and it has had to seek extensions from the Senate on occasion. The government would seek to never respond to the work of professionals, the work of lawyers, the work of people who submit to inquiries—the government would never even bother to respond to those inquiries. It is disrespectful of our entire parliamentary process. People who put their submissions in to an inquiry that the government initiates and says, 'We want to know what you think,' expect that, ultimately, they would also find out what the government thinks about those issues. If you've got a report from 2017—339 pages where there was never a proper government response—that is incredibly disrespectful not just to this parliament and not just to the processes that we ask people to participate in but to people who give their time. For most people who submit to parliamentary inquires—or to the Law Reform Commission, in this case—it's something they do on top of their existing work. They find the time to write submissions and to appear before committees.

As we've also seen with the delay for the banking royal commission, any excuse is a good excuse for this government, when it comes to delaying action on the banking royal commission. It would be a shame to see this motion, if the amendments that are before us are defeated, be used as another form of excuse for delaying the banking royal commission.

The Manager of Opposition Business talked about the Leader of the House. It is probably timely to remind people and, indeed, remind some of the Leader of the House's coalition colleagues, of his record as Treasurer in Western Australia when he served in the state parliament. He was the one who set Western Australia on the course to a $39 billion to $40 billion debt, the largest debt in Western Australia's history. Although, maybe looking at the government's financial management here, that might not be as surprising as it was for many Western Australians, who couldn't believe that someone who would often tell us all how smart he was would make such terrible judgements betting—not predicting, but betting—that somehow Western Australia's share of GST would increase. Of course, we know that didn't happen for another seven years from when he made that very ill-informed bet. I remember the now Leader of the House, when he was the member for Bateman many, many years ago, used to put out letters criticising the then Western Australian Labor Treasurer, Eric Ripper, a lovely gentleman, for having too big a surplus.

That was a long time ago, but the form of some of the Western Australian Liberals—the stock from which the Leader of the House comes—has also been on show in recent days. We saw the WA Liberal leader, Liza Harvey, trying to attack the WA Labor government but, in fact, she ended up issuing an attack on the federal Liberal government when she said, on foreign affairs and trade matters, 'Don't leave it up to the federal government.' I'd be the first to say don't leave it up to the federal government on many things. Indeed, I wouldn't leave it up to the federal government on this matter we're debating today. But to say don't leave it up to them on foreign affairs and trade matters, which are definitely within the powers of the Commonwealth,. was an extraordinary attack—a huge vote of no confidence in the foreign minister and a huge vote of no confidence in the trade minister. I hoped that someone, one of the Western Australian Liberals, might have picked up the phone to her and said, 'This was an incredibly inappropriate intervention.'

Returning to this matter that we're discussing now, litigation funding is a vital part of the paths to justice for many people. People don't go out there saying, 'I really want to be part of some litigation funding exercise.' They do it because it's the only path, for many, to quality legal representation and a fair chance of success through our legal system. Again, if this government has already prejudged the outcome of this inquiry, as I read in some media the other day, then maybe it is just wasting time with this referral. When we get to this sort of ideology, we are seeing a snapback to this government leading through ideology rather than leading through purpose and the national interest.

This government has always hated collective action. They've always had a problem with working people banding together—or, indeed, people of little means banding together—to assert their interests. That's what this is an attack on again today. In my electorate of Perth, we still have queues at Morley Centrelink of people waiting to get onto the job seeker payment. Businesses have been told that the government is going to look at recasting when and how—the rules that these businesses have just complied with—to access JobKeeper. It is hugely concerning that this is the sort of tactic and stunt that the government would seek to pull.

5:50 pm

Photo of Matt KeoghMatt Keogh (Burt, Australian Labor Party, Shadow Minister for Defence Industry) Share this | | Hansard source

When I came into this place and delivered my first speech, I spoke of the fact that justice delayed is justice denied, but also that justice that is inaccessible is no justice at all. These are two issues that arise in the debate here about this referral this evening.

I want to focus, firstly, on the issue of justice delayed. On the Labor side of politics, we were calling for three years or more for a royal commission into our banking and financial services sector. The government voted against that many, many times—26 times, in fact. The Attorney-General came in here and placed this referral motion to look into this issue of class actions and related litigation funding. Since that time, we have debated not just the referral but the amendment moved by Labor that, instead of that issue, we should have an inquiry as to why we have not yet proceeded with the recommendations from the royal commission, and how we can proceed with the recommendations from the royal commission. For an hour we've been debating that, and not one government member has come in to this chamber to in any way defend the position of the government or explain to us why dealing with these royal commission recommendations is not more important when, clearly, to people all across the nation, they are fundamentally important. These are very serious issues and they go to the ordinary people of Australia's capacity to get access to justice—justice in the way in which they have been dealt with and will continue to be dealt with by their banks and financial services providers. Not one government member, in over an hour of debate, has bothered to come in here and explain to us why the amendment moved by Labor is wrong. Clearly, it is the right way forward.

Let's also look at the issue that the government has decided to refer to the Joint Committee on Corporations and Financial Services, a matter that has been dealt with time and time again by law reform commissions. I point out it's not just the Australian Law Reform Commission—which has covered this extensively in its more than 330-page report with many, many recommendations for government that the government's decided to completely ignore. This is an issue that has been dealt with by the WA Law Reform Commission and the Law Council of Australia. It's been looked into by the Bar Association and the Western Australia Law Society, of which I'm a former president. It is an issue that has been looked at by many access-to-justice bodies around the nation as well.

I will admit that at first blush as an early lawyer, class actions had a bit of a whiff to me. But one of the things I have come to learn through my practice in the legal profession—when I was a board member of a community legal centre; when I was the chair of Law Access, our pro bono referral service within Western Australia; in my time on the Law Society; and in my time as a director of the Law Council of Australia—is this: many, many Australians' capacity to access justice is completely denied to them because they cannot afford to access justice. The capacity for small, Mum and Dad, ordinary working Australians to be able to access justice against those that have done the wrong thing to them, especially when it's not just to them as an individual but to them as part of a broader group, is enabled by the opportunity of representative proceedings. It is enabled by the opportunity of a class action, and it is enabled by access to litigation funding to permit that action to go forward. We can find countless examples of ordinary Mum and Dad shareholders who have been able to get access to at least some justice because they have been able to bring a class action against a company that has done the wrong thing by them, against directors who have done the wrong thing by the company that they invested in, against a business that has done the wrong thing by them, not financially, but by causing harm through pollution or poisoning or other matters that have occurred. There are so many different examples.

As the member for Paterson has already gone through, it is not just being able to bring the action but also being able to mediate that action and find a just solution for those people who, on their own, would never be able to bring that sort of action to find justice. I'm not saying that these systems are perfect in the way they operate in the Federal Court of Australia or in the Supreme Court of Western Australia, and they are different everywhere and there are different requirements around litigation funding, but the point is: this has all been inquired into. There are already numerous reports and, in particular, there is the Australian Law Reform Commission report that goes directly to these issues. The government should not be referring another matter off to the Joint Parliamentary Committee on Corporations and Financial Services. What it should be doing is getting on with implementing those recommendations. It should be getting on with making sure that we have fair and equitable access to justice for everyone in this nation through class actions as well as through other means.

I do commend the Attorney-General for providing additional funding to community legal services as a result of this COVID-19 crisis that we are facing now. That is a very good thing. But it stands out as a diamond in the rough of the history of this government when it comes to funding legal assistance services, community legal centres and other access-to-justice mechanisms. It's like they have never seen an access-to-justice mechanism that they don't hate and want to make sure is strangled and not given the funding that it needs. Government will be at the other end of these pieces of litigation. It will be the case that individual citizens in this country will come together to take actions—for example, robo-debt actions—against governments when they get it wrong. It should not be from governments strangling those opportunities down that those people who have been oppressed by government, who have been ripped off by government, are denied access to justice against their own government.

This government should be getting on with the task of implementing those recommendations, not holding another inquiry. I was a member of the Corporations and Financial Services Committee during the last parliament. We had a multi-partisan, unanimous report on whistleblower reforms that should be implemented by this parliament—agreed to by Labor members, Liberal members, Green members and Xenophon party members. Has the government gone forward with implementing any of those recommendations of a unanimous report? No, it hasn't done that. So why would I have any confidence about what would now go through this committee inquiry process, when this committee's own reports are now banking up for the government to get on with implementing? This is just a way of deferring and getting away from actually doing the work of government in this area and doing the things that it should otherwise be doing.

As I mentioned before, it is worthwhile remembering again, as we come to the end of our considerations on this issue, that Labor has put forward a very clear and deserved amendment about instead focusing the attentions of this committee on the things that need to be dealt with coming out of the banking royal commission. We have now been discussing that for over an hour and not one government member has come in here to justify why they think the class action inquiry should take priority. More importantly, not one government member has come in here to tell us why the recommendations coming out of the banking royal commission should not take priority. And that's because there is no reason. That's because the government members—those in the chamber, those not in the chamber—know that Labor is right about this. They know ordinary Australians are sitting at home and looking at what government is doing and what government has said it would do. The government tried to avoid having this royal commission for so long, and now it's tried to hug itself closely to take ownership of the great work that the royal commission did. If the government is so proud of that, why doesn't it pull its finger out and actually get on with seeing those recommendations implemented?

We tried to work with the government in the first half of the calendar year, before we even got to the last election, to prioritise those changes and recommendations being legislated. But, no, the government didn't want to do that. We tried to work with the government at the end of last year to try to get them legislated. No, the government didn't want to do that. We have been the most accommodating opposition on this issue that you could ever find. We have tried to prioritise the things that the government said it wanted to prioritise and then wouldn't prioritise. And now you can't even justify your position. No-one has even come in here and bothered to try to explain why you think that these matters should now not be prioritised, and that silence speaks absolute volumes. It tells us everything we need to know about this government.

Photo of Tony SmithTony Smith (Speaker) Share this | | Hansard source

The question is that the amendment moved by the member for Whitlam be disagreed to.

6:07 pm

Photo of Tony SmithTony Smith (Speaker) Share this | | Hansard source

The question now is that the motion moved by the Leader of the House be agreed to.