Tuesday, 21 June 2011
Governance of Australian Government Superannuation Schemes Bill 2011, ComSuper Bill 2011, Superannuation Legislation (Consequential Amendments and Transitional Provisions) Bill 2011; In Committee
I thank the minister for assisting in facilitating the process. By leave—I move coalition amendments (1) and (2) on revised sheet 7092 together:
(1) Clause 21, page 14 (line 19), omit '9', substitute '8'.
[quorum of board]
(2) Clause 21, page 14 (line 29), omit '8', substitute '7'.
[quorum of board]
These amendments relate to the quorum on the board of the merged superannuation entity to be created under this legislation. The current quorum requirements are for nine directors out of 11 to be present in order to have a quorum on the board. Given that the ACTU has three nominated directors on the board, if for some reason the ACTU has a bloc, as they could well do at some point in the future, or decide to absent themselves from a board meeting, the board would be left without a quorum. Of course, that is an entirely unsatisfactory situation.
It is quite difficult to understand why a board, which has 10 members and one independent chair, should have a quorum of nine. It seems like a quite extraordinarily high quorum requirement which is not consistent, for example, with what we would be practising here in the context of Senate committees. In fact, it would make the Senate committee process entirely unworkable if we had quorum requirements that were this stringent. It has the additional complication of creating the circumstances where the ACTU directors could act on bloc. Bear in mind that they are nominated by the president of the ACTU and they can only be sacked by the president of the ACTU, so they would be clearly subject to, best case scenario, a serious degree of influence by the ACTU president. It would probably be likely that they would be subject to the direction of the ACTU president in terms of how they conduct themselves on that board.
We think it is a very simple amendment and we are not proposing to go in any way overboard. We are only suggesting that the quorum requirements be reduced from nine to eight, which would then have as a consequence that the ACTU by themselves would not be able to make the operations of the board unworkable. It is a very simple amendment. There is not anything else that I need to add to make it well understood. We think it is a sensible amendment. We think it will improve the corporate governance arrangements on the board that the government is creating under this legislation, and we commend it to the Senate.