Senate debates

Tuesday, 9 May 2006

Australian Broadcasting Corporation Amendment Bill 2006

Second Reading

Debate resumed from 29 March, on motion by Senator Minchin:

That this bill be now read a second time.

12:35 pm

Photo of Stephen ConroyStephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | | Hansard source

I rise to speak on the Australian Broadcasting Corporation Amendment Bill 2006. This is a brief bill which has significant implications for the governance of the Australian Broadcasting Corporation. The bill gives effect to the announcement by Senator Coonan in March that the government would ‘restructure the ABC board’. The proposed restructure consists of just one measure—just the one—and that is the abolition of the position on the board that is held by a director elected by the ABC staff. So reform of the ABC board is nothing more than knocking off the ABC staff-elected position. This is a position that has been in place under Labor and coalition governments for the last 23 years.

The board of the ABC is a body charged with significant responsibilities. Any move to change its composition should be subjected to careful scrutiny. ABC directors are required to be the guardians and protectors of a national asset that has been built up by generations of Australians over more than 70 years. The board is charged with responsibility for ensuring that the ABC fulfils the charter given to it by this parliament. The board must retain the independence and integrity of the ABC. Importantly, it must also ensure that the gathering and presentation of news and information is accurate and impartial.

Labor believes that the parliament should maximise the likelihood that those appointed to be directors of the ABC are capable of fulfilling these duties. That is the fundamental principle that underlies Labor’s approach to this debate on the ABC staff-elected director. Labor’s starting point is to ask how the removal of this long established position will help the ABC board to meet its responsibilities under the act. Let us look at the government’s stated rationale for this legislation. The government argues that the staff-elected director is subject to a potential conflict of interest. It contends that staff-elected directors may feel obliged to represent the interests of the people who elected them, rather than to act in the best interests of the ABC.

Senator Coonan has stated that the staff-elected position is an anomaly among Australian government boards. Relying on the Uhrig report on the corporate governance of statutory authorities and officeholders conducted in 2003, the minister argued that representational appointments were not consistent with modern principles of corporate governance. Let us be perfectly clear—Uhrig’s corporate governance foray was a sham. He came up with proposals that run contrary to corporate governance principles adopted all around the world. He was the government’s hatchet man to deliver what the government wanted, and his appointment, the process of his inquiry and his report were a failure of corporate governance.

With the support of the minor parties, Labor moved to have these claims examined by the Senate Environment, Communications, Information Technology and the Arts Legislation Committee. Despite considerable public interest in the issue and a break between parliamentary sittings of more than five weeks, the government deigned to permit only one day of public hearings into the bill. While the inquiry was brief, it was long enough to expose the government’s failure to make a convincing case supporting the abolition of the staff-elected director.

This is a bill driven by extreme ideology and a desire to control the ABC, rather than any genuine concern to improve the ABC’s corporate governance. How can you take this government seriously? It wants the ABC to be its plaything. It is not interested in corporate governance; it just wants to be able to tell the ABC what to do. Submissions to the inquiry, many from concerned ABC viewers and listeners, overwhelmingly opposed the bill. The proposition that the staff-elected directors suffer from a conflict of interest was shown in the inquiry process to be without foundation.

Section 8 of the ABC Act is quite clear that the obligations of all directors are the same, regardless of whether they are elected by the staff or hand picked by the Prime Minister, Mr Howard. During the hearing the government failed to produce any evidence—not one skerrick—that staff-elected directors had failed to comply with their duties to the ABC. There are a range of provisions under the Commonwealth Authorities and Companies Act and the ABC Act that are available to discipline directors who breach their duties. While there have been rumours and unsubstantiated innuendo about leaking, there has not been one case in which the Commonwealth has sought to discipline a staff-elected director using these provisions.

The current and three previous staff-elected directors who appeared before the committee all showed a clear understanding that it is not the role of the staff-elected director to represent the ABC staff on the board. The committee heard of a number of instances which clearly demonstrated the priority that staff-elected directors have given to their responsibilities under the act. For example, in 2002 Kirsten Garrett opposed a lucrative exclusive deal between the ABC and Telstra because it would have allowed Telstra to influence ABC production decisions. In the mid-1990s, Quentin Dempster opposed backdoor sponsorship arrangements that contravened the ABC Act. In both cases, the staff-elected directors resisted proposals benefiting ABC staff because they came at the cost of undermining the independence of the ABC.

As I stated earlier, the government has relied on the flawed Uhrig review and its warnings against representational appointments to government boards to support the changes contained in the bill. The Senate should also be aware, however, that Mr Uhrig did not examine governance arrangements at the ABC. He did not interview the chairman of the ABC, nor did he interview any past or present directors of the ABC. In fact, the terms of reference for the review required Mr Uhrig to focus on government agencies with:

... critical business relationships.

Organisations like the Australian Taxation Office, the ACCC, APRA, ASIC, the Reserve Bank, the Health Insurance Commission and Centrelink were specifically named in the terms of reference. These are very different entities to the ABC. The ABC is a unique institution. The governance arrangements of the ABC should be based upon its special needs. As Professor Bartos from the National Institute of Governance told the Senate inquiry:

In governance terms, the choice of model to be adopted for a public sector body should not be static or formulaic, but be driven by the objectives of the organisation concerned.

There is no reason to expect that a template developed for agencies like the tax office or Centrelink will be appropriate for the national broadcaster.

Labor believes there is a strong case for retaining the staff-elected director position on the ABC board. Since its inception, this position has always been occupied by experienced public broadcasters. The evidence received by the Senate committee demonstrated that staff-elected directors have brought considerable experience in public broadcasting to the deliberations of the board. This is expertise that has been in short supply on the ABC board in the last decade. Since 1996, the government has repeatedly sought to fill board vacancies with its conservative cronies.

Last Friday, Quentin Dempster was elected to succeed Ramona Koval as the next staff-elected director on the ABC board. Mr Dempster has more than 20 years experience as a broadcaster working in the ABC. He has an Order of Australia for his services to the media. In addition, Mr Dempster already has experience on the ABC board, having served as a staff-elected director for four years in the 1990s. It is difficult to imagine a candidate with a more suitable CV to join the ABC board. If this bill passes, however, Mr Dempster will not be permitted to take up his recently elected position.

Why is the government so desperate to stop this happening? Why is this bill being rushed through the parliament? The answer may lie in the fact that Mr Dempster has been strongly critical of proposals to commercialise the ABC’s growing broadband content. While the ABC Act prohibits advertising on television and radio, this restriction does not apply to the internet. The minister has already stated her view that the introduction of advertising is a matter for the board. Abolishing the staff-elected position would remove a strong opponent to such changes. Of course, the commercialisation of internet content would not be in the interests of the ABC; it would undermine the ABC’s editorial independence. The ABC’s digital content creators must be free to produce material without worrying about offending the sponsors of the ABC website. The parliament should not lightly silence the voice of a strong defender of ABC independence.

Labor believes that the abolition of a staff-elected director’s position will have a significant detrimental impact on the effectiveness of the ABC board and undermine public perceptions of its independence. The staff-elected directors have a unique insight into ABC operations. They can play a key role in assisting the board to hold ABC management to account. One adverse consequence of the bill that the Senate is considering today is that the actions of the ABC management will receive less scrutiny than they did yesterday.

Senators can search for a sustainable policy justification for abolishing the staff-elected director, but they will search in vain. The truth is that this bill is not about improving the ABC’s corporate governance; it is just a further attempt by the government to undermine the independence of the ABC. The staff-elected position is just one position out of a possible nine on the ABC board. However, it is the only position that is beyond Prime Minister John Howard’s capacity to influence or control. That is why he has decided it has to go. Some Liberals understand the dangers of the government’s proposal. They also understand the real motivation for this bill. In March, former leader of the Liberal Party John Hewson wrote in the Australian Financial Review:

... the Government’s recent decision to stop staff electing a director of the ABC board is a churlish, pyrrhic victory for some of the ideologically-based antagonists in the Liberal Party and some of their sympathetic business mates.

John Hewson has called it as it is. He goes on to say:

It is clearly against the best interests of the institution and the listening and viewing public.

This is not the Labor Party, the unions or the Friends of the ABC making these comments; this is the former leader of the Liberal Party. Dr Hewson has been on a few boards in his time. He might know something about the key requirements of good corporate governance. I hope that there are some Liberal senators who will reflect on John Hewson’s comments and stop and think about where the government is going with these proposals.

This legislation is simply the latest instalment in the government’s decade long ideological crusade against the ABC. In its first budget in 1996, the government slashed ABC funding. These funds have never been fully restored. Today, the ABC has $51 million less in real terms to make programs than when John Howard came to office. Is it any wonder that, last year, the ABC was only able to broadcast 13 hours of locally produced drama? This is a national disgrace.

The extent to which the ABC has been underfunded was recently exposed when a draft version of the government’s own KPMG funding adequacy and efficiency report was leaked to the media. Let us be clear. The government brought in an outside audit company to have a look at the ABC and the claims that they were underfunded. KPMG found that the ABC needs an extra $125 million over the next three years just to maintain existing services. Tonight’s budget provides an opportunity to restore adequate funding to the ABC. The government is sitting on a surplus that some estimate to be more than $17 billion. The fact that the minister will not release the KPMG report, however, does not bode well. It suggests that the government wants to continue to hide the impact of its ideologically motivated funding squeeze on the ABC. Australians are increasingly realising that this is an arrogant government. They have almost total control of the parliament and they are increasingly intent on using that power to pursue ideological obsessions that are not shared by ordinary Australians.

The government is convinced that the ABC is plagued by left-wing bias, so it dispatches its stooges and cronies to the board to keep it in line. The Australian people do not share the government’s warped views. According to research conducted by Newspoll, 82 per cent of people believe that the ABC is balanced and even handed when reporting news and current affairs. That leaves 18 per cent; I guess they must all live on the other side of the chamber.

Labor does believe that the ABC board is in need of genuine reform. There is public concern about the ABC’s corporate governance, but it does not relate to the staff-elected director. After a decade of the Howard government, there is now a clear conservative bias in the board. Reforms are needed to strengthen public confidence in the independence of the ABC board.

There was a time when the Prime Minister claimed to understand the importance of an independent ABC. Back in 1995 he railed against appointments made by the Keating government. Back then, he lectured: ‘You not only must have a board that is completely politically neutral but it must be seen to be neutral.’ That was said by John Howard, the current Prime Minister of Australia. It would be interesting to hear how the Prime Minister thinks his appointments of conservative spear throwers like Michael Kroger, Ron Brunton and Janet Albrechtsen measure up against this criterion. What incredible hypocrisy!

John Howard was right back in 1995, but in this area, as in so many others, he has failed to live up to the principles he espoused in opposition. The current appointments process lacks transparency and is too politicised. Under current arrangements, the names of candidates are taken by the minister for communications to cabinet, but that is about all the public know about the process. How do people apply to fill a board vacancy? Is it simply a matter of having a Liberal Party membership form? What criteria are used to assess candidates? Do you have to be a member of the right club? Does it help if you have donated money to the Liberal Party? Clearly, that is what the Reserve Bank board process has been. It certainly seems to help if you have been a conservative cultural warrior.

Labor believes that there needs to be real reform of the appointments process to guarantee the independence of the ABC board and the expertise of its members. Since 2003, Labor has supported an independent merits based appointments process for ABC and SBS board vacancies. The process is based on the so-called Nolan rules that were developed in the UK and govern appointments to the BBC. Appointments to the ABC board must be open and transparent. Vacancies should be publicly advertised. There should be clear merit based selection criteria.

Labor’s policy provides for an independent selection panel to undertake a proper shortlist selection process. In stark contrast to current arrangements, the selection of the shortlist would be independent of the minister. Under Labor’s model, the minister would be free to nominate someone not on the list, but there would be a political price to pay. The minister would be required to table in parliament a formal statement of the reasons for selecting a candidate who was not on the shortlist. The publicity surrounding such a move makes it extremely unlikely that any government would pursue this option. I have to say, though, that on the form of this government, it would be prepared to be so arrogant that it would do it, anyway.

Labor’s policy would not exclude people previously involved in politics from serving on the ABC board. It would ensure, however, that they had the skills to do the job. (Time expired)

12:55 pm

Photo of Andrew MurrayAndrew Murray (WA, Australian Democrats) Share this | | Hansard source

The first staff-elected position on the governing body of the ABC was introduced by the Whitlam government in 1975, 31 years ago, and was subsequently abolished by the Fraser government. Since 1986, under both coalition and Labor governments, the board of the ABC has included a director elected by the staff as legislated under the Australian Broadcasting Corporation Act 1983.

The staff-elected director is one of a maximum of nine directors. Up to seven members of the board are appointed by the government, and the managing director is appointed by the board. The staff-elected director is the only democratically elected position. All the others are appointments.

The Australian Broadcasting Corporation Amendment Bill 2006 proposes to abolish the staff-elected position. The Democrats believe that the decision to remove the staff-elected ABC board member is bad politics, bad public policy and bad corporate governance. It is bad politics because it exposes a nasty prejudice; it is bad public policy because an experienced staff member provides invaluable skills and insights to the board; and it is bad corporate governance because not only is that ABC board member the only appointment on merit through democratic election, but in Europe, and in many companies overseas, staff membership of boards is common because it is so useful.

As stated in the Labor, Greens and Democrats minority report on the bill, the Democrats believe that the bill will adversely impact on the performance of the ABC board and will further undermine public confidence in the independence of the ABC. The Minister for Finance and Administration, Senator Minchin, in his second reading speech on the bill, argued that:

The position of a staff-elected Director is not consistent with modern principles of corporate governance and a tension relating to the position on the ABC Board has existed for many years.

This tension is manifested in the potential conflict that exists between the duties of the staff-elected Director under the Commonwealth Authorities and Companies Act 1997 to act in good faith in the best interests of the ABC, and the appointment of that Director as a representative of ABC staff and elected by them. The election method creates a risk that a staff-elected Director will be expected by the constituents who elect him or her to place the interests of staff ahead of the interests of the ABC where they are in conflict.

I venture to suggest that the minister knows very little about international corporate governance. If he did, he would know that staff-elected directors are not uncommon and are a useful feature of the way in which boards operate internationally.

As was noted in the joint minority report, while the method of appointment of the staff-elected director differs from that of other non-executive directors, the ABC Act is quite clear that the duties and responsibilities are the same for all directors. On the theory that the government is putting forward, a Liberal Party member appointed by the government will be beholden to the Liberal Party that appointed him. That is the argument it is offering regarding the election of a staff-elected director—that that staff-elected director is beholden to the staff that elected them. If that is so, the Liberal Party appointed member is beholden to the Liberal Party. I think that is a slur on some of those persons who have been appointed.

This recommendation comes from a government that has done nothing about the patronage in companies that applies when directors are elected. Full independence of a director is only possible when the method of appointment and election is objective, on merit and not subject to patronage, favour or inducements, and where objective, fair and consistent separation or contract ending mechanisms exist.

The board of a company is the central institution in the relationship between shareholders and the company, stakeholders generally and auditors specifically. It is self-evident that many boards, directors and companies operate to high standards, but it is the task of legislation to attend to those who do not and to appraise the public interest. Companies have such an effect on our society that serious weaknesses in Corporations Law should be attended to, and a major weakness lies in the director election processes, to which the government has paid absolutely no attention. Regrettably, the election of directors is often either deliberately or effectively rigged in favour of dominant shareholder interests. I am told that 52 per cent of ASX corporations have a single dominant shareholder and many of the rest have a few dominant shareholders.

Such dominant shareholders frequently control the boards of our companies through their voting power. That means that many and perhaps most directors are directly placed by or under the patronage of a dominant shareholder or shareholders, who will quite naturally seek to ensure that their interests are put first. This dominance and patronage over many directors is reinforced by company constitutions and board behaviour that allow or foster poor director election processes. We have got exactly the same problem with appointments by the government to these boards. It is a question of patronage and the real problem the government has with a staff-elected director is, of course, that that staff-elected director is not subject to their patronage.

The Bills Digest notes that neither the ABC Act nor the CAC Act require or give the imprimatur to staff-elected board members to favour the interests of their constituents. Whether staff representatives make a practice of prosecuting the interests of staff may be moot, but it is clear that the legal duty and the actual practice of such board members has not been to their constituents but to the organisation more generally. Those duties are set out in the ABC Act and the CAC Act.

The CAC Act sets out the duties of directors such as reporting obligations. It also imposes duties. These include duties of care and diligence, the duty to act in good faith, the duty not to misuse the officer’s position and the duty not to misuse information. No staff-elected director has ever contravened those duties because the boards would have taken action if they had done so and it would have been brought to the attention of the board.

The Bills Digest concludes that the statutory duty of a staff-elected representative is not to the staff specifically, any more than it is for the other board members. Therefore a staff-elected board member who places the interests of staff ahead of the interests of the ABC as a whole would be in breach of their duties under the legislation as it currently stands. The statutory duty of the staff-elected director was reconfirmed by a past director, a current director and a would-be future staff-elected director. The Bills Digest notes that former staff-elected director Kirsten Garrett, who was a staff representative on the ABC board from 1996-2000, said that the argument that the staff position created an untenable conflict was unfounded. She said:

Once he or she enters the boardroom, the staff-elected director is answerable to the charter of the ABC and the Australian community. You are informed by staff but you are in fact an executive director of the board and must behave as such, that is independently. The staff-elected director is accountable in exactly the same way as other directors.

Current staff-elected director Romana Koval said in her recent Staff-Elected Director’s Report no. 11:

Contrary to the Minister’s view, there has never been uncertainty about the accountability of the staff-elected director to the ABC Board. I am required to act in the best interests of the ABC, as are all other directors, and it’s a serious responsibility that I have carried out with passionate commitment

In an open letter to senators, the nominee for the staff-elected director position who has been elected by them, Quentin Dempster, had this to say:

The position of staff-elected director has prevailed since the creation of the corporation ... the primary purpose was to bring to the board table knowledge and expertise of broadcasting existing within the corporation’s creative program makers and staff …

                 …         …         …

The method of appointment by Electoral Commission ballot of all the corporation’s employees may imply a constituency but the Act clearly states the director appointed—

or elected—

by this method is bound by the Act’s clauses covering duties of directors.

As the joint minority report notes, a number of examples were cited where staff-elected directors argued against initiatives that would have directly benefited staff because they would have undermined the ABC’s independence. There is no evidence that the staff-elected director does not understand their legal responsibilities; there is no evidence that the person in this position has not acted in the best interests of the ABC; and there is no evidence that staff who elect the director have asked or expected the director to place the interests of staff ahead of the interests of the ABC. Some people have argued that there is evidence that government appointed board members have been behaving with the interests of the government in mind. I do not know if that is true or not, but it has been said.

Minister Minchin also noted in his second reading speech that abolishing this position is consistent with the findings of the Review of the corporate governance of statutory authorities and office holders, also known as the Uhrig review. I have read Mr Uhrig’s report and recommendations and I am not inclined to bow down to them as wisdom from the mount because they are hardly that. In reading his report, I think he has had a fairly channelled and very Australian view and he needs to widen it to look at global trends and how international corporate governance operates. International corporate governance is seeking to introduce more independence, not less, into directorships and board positions and to represent a wider range of interests. It is very common in many overseas corporations and entities for staff-elected directors or people who represent their constituency to be on boards. Mr Uhrig, despite his name, which I suspect might be of a German origin, has not attended to, for instance, the German precedents.

The minister said that the position of a staff-elected director is uncommon amongst Australian government agency boards. While the minister’s statement may be true, it does not then stand to reason that there should not be a staff-elected position or that Australia uses the best governance models. For companies in Europe and in many other countries, representatives of staff are commonly included on boards because the practice is so useful. Professor Stephen Bartos, director of the National Institute for Governance, who has a great deal of experience as a former senior executive within the Department of Finance and Administration, in his submission to the Senate inquiry into this bill noted that:

... staff-elected directors on a Board do represent an anomaly amongst Australian public and private sector boards in general governance terms—although ours is not a universally accepted governance model. In the CCH article cited earlier, I comment: ‘In Australia, the whole Anglo-American model of governance doesn’t favour representative positions on boards. However, it’s not the case around the world. There are other countries where representative positions are much more common ...’

This is a country where we are continually asked to look for international precedents on such things as tax, intellectual property and the way in which research and development is operated. We are a country that is trying to take the best of globalisation but, in this area, we remain steadfastly committed to a peculiarly narrow perspective.

As the Bills Digest to this bill notes, there are in fact other Commonwealth statutory organisations in Australia with staff-elected positions on their governing bodies, including the Australian National University, the Australian Institute of Health and Welfare and the Australian Film, Television and Radio School. Furthermore, many public bodies have a variety of other kinds of representational appointments, including departmental, industry, interest group, community and regional appointments.

Professor Bartos also observed:

In governance terms, the choice of model to be adopted for a public sector body should not be static or formulaic, but be driven by the objectives of the organisation concerned.

As was stated in the joint minority report, we believe that, given that the objectives of the ABC include the maintenance of independence, it is appropriate for a staff-elected director to sit alongside government appointed directors. Professor Bartos went on to say:

While there are both advantages and disadvantages of representative board positions, the final decision on an appropriate governance structure depends on where legislators see the ABC as situated in the broader map of the broadcasting industry. As I noted in my interview on the subject, if one sees the ABC “as operating in the same space as other television and radio stations, having a governance structure like them is probably rational and reasonable. If you conceive of the ABC as being somehow some sort of different community-based body, you’ll see having representative directors onboard as being more reasonable.”

The ABC is unique. The ABC is an important part of our democracy. It provides a lifeline to regional Australia, informed current affairs reporting, vital contributions to Australia’s culture and the provision of Australian content. Public funding means that the ABC does not have the same commercial pressures of other broadcasters, but it also has far greater constraints than other broadcasters because it is dependent on the government of the day for its funding.

The ABC is allowed to provide diverse programming and maintain its independence and journalistic integrity through its structure. The staff-elected director brings to the board the knowledge and expertise of broadcasting that exists within the corporation’s creative program makers, management and staff and the views of the Australian communities they work in.

The government has perversely claimed that an elected position is less accountable than an appointed one. This claim, however, is counterintuitive, because at present no other ABC board member, apart from the staff member, is democratically elected. That is in complete contrast to the major commercial media organisations. The other board appointments are made by the government of the day and are often made with partisan political criteria and patronage ideas in mind.

The interesting thing, of course, when you exercise patronage in appointing people is that you often find that the people surprise everybody and act in a way that is to their credit and contrary to the intention with which they were appointed. Many of those appointed under government patronage have actually turned out to be pretty good directors and have done rather well, as is shown by the Chairman of the ABC, who has not turned out to be anybody’s puppet.

There are no public advertisements for ABC board positions, no objective panels for selection and no published criteria for board selection. These are all weaknesses with the appointment process. Consequently, even the best ABC board members labour under the slur of being fellow travellers of the government of the day and of being fifth columnists trying to subvert the ABC charter of independence. Even where that is not true, that slur would be better countered by objective panels for selection and published criteria for board selection, which would allow people of merit to be on the board. At present, there is a widespread public perception that government appointments result in patronage to well remunerated positions. This perception can damage the reputation of these bodies, and indeed of the directors so appointed, as in the public eye they are seen as being controlled by persons who lack the appropriate independence and who have a political objective.

As I have noted many times in this chamber before and in the Democrats’s additional comments to the Senate committee report on this bill, this issue was extensively investigated by the Nolan committee appointed by the United Kingdom parliament, which in 1995 set out the following principles to guide and inform the making of such appointments: a minister should not be involved in an appointment where he or she has a financial or personal interest; ministers must act within the law, including the safeguards against discrimination on grounds of gender or race; all public appointments should be governed by the overriding principle of appointment on merit; except in limited circumstances, political affiliation should not be a criterion for appointment; selection on merit should take account of the need to appoint boards that include a balance of skills and backgrounds; the basis on which members are appointed and how they are expected to fulfil their roles should be explicit; and the range of skills and backgrounds that are sought should be clearly specified.

The United Kingdom government fully accepted the committee’s recommendations at the time and have maintained those principles and appointments. The Office of the Commissioner for Public Appointments in the UK was subsequently created, with a similar level of independence from the government as the Auditor-General, to provide an effective avenue of external scrutiny. The Democrats have used the Nolan committee’s recommendations in our persistent and long-term campaign for appointment-on-merit amendments in various items of legislation, because they are tried and tested. Meritorious appointments are the essence of accountability.

While some may appreciate the irony that, in a bill that proposes to remove the only democratically elected position to a board, the Democrats propose to move an appointment-on-merit amendment, even though we know that this government will reject for the 31st time at least—I suspect it is more—the idea of appointments on merit and the ideas on which the Nolan principles are pronounced. That is to their eternal discredit. They cannot even match up to the UK on this fundamental issue.

I am not sure what pushing this boat all the time makes me: stubborn and idealistic or someone who truly values government accountability and transparency. But I do hope that, one day, a future government may in fact bring these rules in.

In conclusion, as stated in the joint minority report, this bill comes after a decade where the ABC has been chronically underfunded and follows the appointment of a series of conservative members of the board to the ABC. The staff-elected position on the board is the sole remaining voice not directly appointed by the government and is the one position on the board that is beyond the government’s capacity to influence or control. It is no wonder that these control freaks are trying to remove it. The Democrats believe the ABC belongs to all Australians and the ABC board must contain people with a wide variety of experience and skills in broadcasting, journalism and communications to ensure that ‘Aunty’ can provide the range and depth of programming and the independence of views that its charter mandates.

1:15 pm

Photo of Rachel SiewertRachel Siewert (WA, Australian Greens) Share this | | Hansard source

The Greens will be opposing the Australian Broadcasting Corporation Amendment Bill 2006. If you look at the committee that inquired into this bill, you will find 55 submissions—53 opposed the bill and two were neutral. When you look at the government’s rationale for this bill as expressed in this place on 29 March, you will find that Senator Minchin argued:

... a staff-elected Director is uncommon amongst Australian Government agency boards.

He said it is not consistent with modern principles of corporate governance, creates tensions on the ABC board and creates an expectation that a staff-elected director will be expected by the constituents who elect him or her to put their interests ahead of those of the ABC where they are in conflict. He also referred to the findings of the Uhrig review in relation to representational appointments to governing boards and stated:

There is a clear legal requirement on the staff-elected Director that means he or she has the same rights and duties as the other Directors, which includes acting in the interests of the ABC as a whole.

In arguing the response of the Australian Greens to this bill, I will address each of the following in turn: the alleged uncommonness of the role and its supposed inconsistency with modern governance; the creation of so-called tension on the board and the so-called expectations of constituents and whether this creates a conflict of interest; and the relevance of the findings of the Uhrig report on the issue of whether the board position is representational. Then I will talk about the independence of the ABC.

Firstly, I would like to look at existing legal requirements. There is already a legal requirement for board members to act in the best interests of the ABC, which is backed up by civil penalties. The Commonwealth Authorities and Companies Act 1997, the CAC Act, requires board members to:

... make the judgment in good faith for a proper purpose and does not have material personal interest in the subject matter of the judgment and informs himself or herself about the subject matter of the judgment to the extent that he or he reasonably believes to be appropriate and rationally believes that the judgment is in the best interests of the Commonwealth authority.

No evidence was presented to the inquiry or in this place that the staff-elected director ever acted contrary to these requirements, and if the government had such evidence they should act upon it—in other words, they should put their money where their mouth is. We believe that these civil penalties are sufficient to deal with any inappropriate behaviour by the staff-elected director should it arise. I would like to point out that we do not think it has ever arisen, but that the government has the power to take action as it is.

Is their argument that there is a public perception of bias? I think the argument is that there is a public perception of bias by the appointees from the government. Is this consistent with other practices? I would like to look at the statement about it being uncommon among Australian government agency boards and that it is not consistent with modern principles of corporate governance. A number of submissions presented evidence to the inquiry that staff-elected or stakeholder-nominated board members are consistent with practice elsewhere, including public companies, universities, some government statutory authorities, and exclusive private schools. There is the ANU—also Oxford and Cambridge—the Australian Institute of Health and Welfare, Mercedes Benz, the film schools, Canberra Girls Grammar, the fishing industry, Australia Post, Defence Housing Authority and the Australian Fisheries Management Authority. All of these also seem to be travelling quite well with stakeholder representation.

Employee participation is arguably a well-established principle of good management, and many Australian government boards go to great lengths to ensure industry participation. Why not other participation? There is a wide diversity of practice in corporate governance. In fact, Uhrig stated:

It is not surprising that there is no universally agreed definition of corporate governance, just as there are no universally accepted structures and practices that constitute good governance.

We would argue that there are no precedents for removing this position and that good governance depends on how the board runs and what the requirements are of the company or structure that that board is managing. As Uhrig points out, there is no standard form for good governance. We argue that the current staff-elected director position is in fact essential to running an organisation of the nature of the ABC.

The Uhrig review was very specific to the areas of taxation regulation and the provision of services in response to complaints about the ACCC and the ATO treating big businesses unfairly. The ABC is a completely different class of statutory authority to those examined by Uhrig. The terms of reference of the Uhrig review were concerned with regulatory and service delivery authorities. In Uhrig’s own words, the review was very ‘practical’ in focus, and its key findings stem from ‘the outcome of consultations with key participants’. Neither the ABC nor any other federally legislated bodies with elected directors were considered or consulted. It is inappropriate to stretch its findings to the ABC.

Uhrig carefully qualified his findings and made it clear he was referring to the problems caused by representational appointments, not elected ones: in the private sector in relation to representatives of a parent company to the board of a subsidiary and in the public sector in relation to the appointment of public servants as departmental or government representatives. It is misleading to equate and confuse Uhrig’s comments and examples of representational appointments with the issue of stakeholder directorships. The election of a stakeholder position does not equate with a representational role.

That leads us on to the question of whether this is a representative role. The evidence presented by a range of stakeholders, including current and former staff-elected directors, made it very clear that the role is not seen as representational. Numerous examples were presented of situations where the staff-elected director had put the best interests of the ABC ahead of those of the staff, for example in the Telstra deal. When we questioned all the staff-elected directors who appeared before the committee during the inquiry, it was very clear that they knew what their obligations were and that they had acted in the best interests of the ABC at all times. This was backed up, as I said, by communications from the staff-elected directors to the ABC staff, which clearly spelt out that the role is not representational.

The Australian Broadcasting Corporation Act 1983, the ABC Act, made it very clear that the staff-elected director has no role to represent the interests of ABC employees to the board. The minister’s talk of expectations of constituents is particularly misleading in this context, and this is remarked upon in the dissenting report from the Labor Party, the Democrats and the Greens. We also made a comment about the attack on Ms Koval which appears in the majority report. It is extremely disappointing that the majority report criticises Ms Koval, particularly about her refusal to sign the ABC board protocol. In fact that refusal clearly demonstrated her independence, and she clearly outlined the reasons why she did not feel it was appropriate to sign the protocol.

That takes me on to the issue of conflict of interest. Evidence to the committee contradicted this claim. All previous staff-elected directors stated that the role is not a representational one and that they had been at pains to exercise their independence and to communicate this to ABC employees. No examples of particular conflicts of interest were presented. There is a requirement for all board members to declare any potential conflict of interest. This is good governance and this is a requirement for all members of the ABC board.

The issue of tension was also raised. It was claimed that having a staff-elected director on the board would cause tension. You would expect tension on any good governance board. Surely directors are never of one single mind, in any circumstances. Surely, as long as the interests of the ABC are put first and any conflicts of interest are declared, some tension between board members who have different ideas and are willing to discuss them is in fact in the best interests of the corporation. Having dynamic tension is creative. I do not believe that having a staff-elected director is any different from having anybody else on the board with a difference of opinion. Different perspectives encourage creativity and healthy debate.

Now I would like to talk quickly about the reasons for having a staff-elected director. Having argued why we believe that there is no problem with conflict of interest with the role and why existing legal requirements and civil penalties are sufficient to deal with any past or future inappropriate behaviour, I would like to look at the positive sides of having a staff-elected director.

The duties of the ABC board, as has been articulated before, are to ensure that the corporation output is of maximum benefit to the people of Australia, to maintain the independence and integrity of the ABC and to benchmark the accuracy and impartiality of news and information presentation by the recognised standards of objective journalism. The ABC is statutorily required to provide broadcasting services which are innovative and comprehensive, contribute to a sense of Australian identity and are entertaining, informative and educational. It is also required to encourage the performing arts in Australia and encourage awareness of Australia and Australian affairs within and outside Australia.

The point is that the requirements of the public broadcaster, as I have just articulated in terms of program quality and statutory requirements, are very different from those of a commercial broadcaster. Producing quality broadcasting is heavily reliant on the particular knowledge and skills of the ABC staff and their commitment to the ABC’s mission. The ABC must foster its creative human resources and monitor the breadth and quality of its output. It needs to ensure that there is broadcasting experience, particularly public broadcasting experience, on the board. Previous staff-elected directors have been experienced broadcasters who have brought valuable insights into policy issues and have been frequently called on by the board to share their experience. Kirsten Garrett, a former staff-elected director, said:

It is rare for other directors have a working knowledge of the dynamics of journalism or program making.

I would like now to turn to independence from political interference. Recent appointments have been blatantly political. The loss of a staff-elected director means that the actions of the ABC management are likely to receive less scrutiny. We need a position on the board which is beyond government’s capacity to influence or control. There is a strong public perception that this bill represents an ideologically motivated attack on the ABC. The ABC has been chronically underfunded for years. ABC historian Professor Inglis has said:

The ABC is bound to broadcast information and opinion useful and harmful to people in public life. More particularly, the ABC accommodates criticisms, sometimes severe, of the government on which it depends for revenue, and that is bound to be a rich source of conflict.

It is absolutely essential that we have independent people on the ABC board, and the only way at the moment that we can as a nation ensure that is by having a staff-elected director. That staff-elected director is at least one person who has shown independence, who has been willing to stand up and ensure that the charter of the ABC is maintained.

The Greens are deeply concerned that there is a real risk that the strength of ABC Online and the incredible diversity of its content will result in a push for the ABC board to enter into commercial agreements with such things as search engines, for example, or some other online provider and to more generally go down the line of commercial exploitation of the ABC’s content. We are deeply concerned that this commercial exploitation will further push and ignore the charter of the ABC. A number of us are deeply concerned about the commercialisation that has taken place at SBS and that the SBS charter has been further marginalised. We are deeply concerned that, with the loss of the staff-elected director, the ABC will be pursuing this line.

We believe that the process for appointments to the ABC board needs to be open and transparent. As was articulated in the dissenting report:

There should be an open and transparent process for making appointments to the ABC board. Vacancies should be advertised and there should be clear merit-based selection criteria.

An independent selection panel should conduct the shortlist selection process.

If the Minister does not appoint a short-listed candidate he or she should be required to table in Parliament a formal statement of the reasons for departing from the shortlist.

We heard overwhelmingly in the committee that it is a bad idea to take away the staff-elected director position. We will oppose this legislation. We believe it is really about making the ABC less independent. We urge the government not only to reconsider this position but also to put in place a much more open and transparent process to make our ABC really independent and to maintain the quality that we believe is essential and which all Australia is looking for from the ABC.

1:31 pm

Photo of Alan EgglestonAlan Eggleston (WA, Liberal Party) Share this | | Hansard source

The Australian Broadcasting Corporation Amendment Bill 2006 has the effect of abolishing the position of staff-elected director on the ABC board. The Senate Environment, Communications, Information Technology and the Arts Legislation Committee has held an inquiry into the provisions of the bill in the last few weeks. The committee received submissions from 59 organisations and individuals and held a public hearing here in Canberra.

Abolishing the position of staff-elected director is consistent with the findings of Uhrig’s review of the corporate governance of statutory authorities and office holders. The Uhrig review stated that it is opposed to representational appointments on boards because they:

... can fail to produce independent and objective views. There is the potential for these appointments to be primarily concerned with the interests of those they represent, rather than the success of the entity they are responsible for governing.

The review goes on to observe that the preferred position is not to create circumstances where a conflict of interest might arise. Members of the Senate will therefore, I am sure, understand that the position of staff-elected director does not accord with modern principles of corporate governance in that there is a potential conflict between the duties of the staff-elected director, under the Commonwealth Authorities and Companies Act 1997, to act in good faith in the best interests of the ABC and the appointment of that director as a result of a process of election by the staff.

There is, without any doubt, an inherent risk that a staff-elected director will be expected by the constituents who elect him or her—in this case, the staff of the ABC—to place their interests ahead of the overall interests of the Australian Broadcasting Corporation. This inherent conflict of interest was noted by the Chairman of the ABC, Mr Donald McDonald, when he stated:

Inevitably there has been a tension between the expectations placed by others on their role—

meaning the staff director—

and their established duties as directors of a corporation.

The committee received evidence that staff sometimes have expectations of the staff-elected director which do not accord with his or her role as the director of the corporation. The incumbent staff-elected director, Ms Ramona Koval, for example, refused to sign the ABC board protocol outlining the governance arrangements of the board. This protocol is viewed as important to the effective operation of the board, especially in the light of alleged leaks of confidential board information. In particular, it raises concerns about the ability of staff-elected directors to act in the best interests of the ABC and, in doing so, to act in a manner that places the interests of the ABC above those of the staff who elected them.

The committee received submissions expressing concern that the absence of a staff-elected director will compromise the independence and integrity of the ABC, but the arguments put were not supported by any compelling evidence to this effect. In fact, all members of the board will still be required to act in accordance with the provisions of the Commonwealth Authorities and Companies Act 1997 and of the Australian Broadcasting Corporation Act 1983, which charge the board and its members with the responsibility of maintaining the independence and integrity of the corporation. Moreover, in the absence of a staff-elected director, there will still be a member of the board not appointed by the government—this being the managing director of the ABC, who is a full member of the board and is appointed by the board rather than by the government.

The committee also received evidence that the staff-elected director brings broadcasting expertise and experience to the board. The implication seemed to be that that was the only means by which the board could be provided with information about broadcasting in its various dimensions. But there are of course other methods of bringing such knowledge and information to the board, such as by bringing in experts or seeking the opinions of consultants where necessary. This view also ignores the broadcasting experience of other board members—including Mr John Gallagher QC and Mr Steven Skala on the current board—all of whom have quite substantial experience in the television and broadcasting industries.

The ABC chairman, Mr Donald McDonald, has acknowledged that the interests of the staff will not be neglected in the absence of a staff-elected director. In particular, the managing director is a full member of the ABC board and he acts as a conduit between staff, management and the board, so the interests, needs and requirements of the staff of the ABC have a process through the managing director by which their views can be expressed and brought to the attention of the board.

This bill, in restructuring the board of the ABC, will ensure that it operates within modern principles of corporate governance and accountability. The staff-elected director faces, in the government’s opinion, an inherent conflict of interest. As the Uhrig review has noted, it is better not to create situations in which conflicts of interest can arise. I commend this bill to the Senate.

1:38 pm

Photo of Dana WortleyDana Wortley (SA, Australian Labor Party) Share this | | Hansard source

The Australian Broadcasting Corporation Amendment Bill 2006 is nothing more than a continuation of the standard Howard government attack on our public broadcaster. The explanation for the bill is simply what we have come to expect from this government and its attack on the ABC. The excuse that the government gives for this new manipulation of the ABC’s board is that a potential conflict of interest exists in the duties of the staff-elected director, basically because they are elected rather than appointed to their position.

The minister announced the move by the government to impose this change during the Commonwealth Games. The existence of the position of staff-elected director to the board provides for the presence of staff expertise on the board. This staff-elected director gives the ABC board a vital insight into the day-to-day operations of our national broadcaster. Interestingly enough, in the 2001 report of the Senate Environment, Communications, Information Technology and the Arts References Committee entitledMethods of appointment to the ABC board, in response to a recommendation, government senators stated:

There has been no suggestion that the position of the staff-elected director will be abolished.

Now the government has changed its mind. It changed it with the Senate majority.

The basis for the government’s logic in this theory of doing away with the position comes from their loose interpretation of the Uhrig review, which suggests that representational appointments to boards carry a risk. This is where Senator Coonan just does not get it. The position is elected by the ABC staff. The position is occupied by a member of the ABC staff. But it is not a position that represents the individual concerns of ABC staff. The staff-elected board members know this. Current and former directors stated it on record during the recent Senate inquiry. The directors know that they are there to serve the best interests of the ABC as a collective operation.

The government also relies heavily on the submission of Professor Stephen Bartos, yet Professor Bartos did not exactly tell the government what they wanted to hear either. If anything, his submission encouraged the position. He claims that ‘the choice of model to be adopted for a public sector body should not be static or formulaic’—it should not be standard or rigid. Professor Bartos adds to this by saying that public bodies should be ‘driven by the objectives of the organisation concerned’. In simple terms, he is saying that a unique organisation such as the ABC is benefited by having a wide-ranging composition of professionals on its board of directors.

The staff-elected director on the board of the ABC brings broadcasting experience to a select group which oversees the Australian Broadcasting Corporation. The staff elect this person from among their peers because they are highly skilled, with a significant broadcasting knowledge base. They do not elect them on the basis that they will take all the individual problems of the staff to other members of the board. That is simply not their role. Senators opposite dismiss this and do not believe it to be important.

They seem to think that if the board is not sure about a decision relating to broadcasting then they will just outsource the question: ‘Ask an expert. Call in a consultant.’ How are the board members supposed to know what is relevant and what is not if they do not have the broadcasting knowledge? If they do not have an understanding of the day-to-day operational requirements of our national broadcaster, how are they to know when they should be consulting an expert? How do they know the questions they should be asking when they do not have the current knowledge of broadcasting that the staff-elected director brings to the board? We have, for our benefit, an example of just such a situation.

In submissions to the committee inquiry into this bill, there were a number of examples of the benefits that the staff-elected director position creates. Of particular note was a submission from the immediate past president of Friends of the ABC South Australia, Mr Darce Cassidy. Mr Cassidy worked for the ABC for 33 years, with his last position being that of managing director’s representative for South Australia. He highlighted an example where a former staff-elected director, Mr Tom Molomby, who served on the board from 1983 to 1987, used his position in the best interests of the ABC even though it proved to be unpopular with the staff. Not only did Molomby not support a move that was considered popular by staff but his understanding of the operational aspects of the organisation enabled him at one of his early board meetings to raise an issue that would have otherwise been overlooked.

In the early 1980s, the ABC in Melbourne was readying itself to move to outer East Burwood. This move was very popular with many members of the ABC staff because it was close to where they lived and meant that they would only have a short trip to work each day. Mr Molomby, however, used his professional knowledge and judgment with great distinction. I would like to read an extract from Mr Molomby’s book, which is quoted in Mr Cassidy’s submission, to allow the chamber to reflect on this judgment and how it directly affected major operations within the Melbourne bureau. Mr Molomby stated:

It was in my view a wholly impractical location from which to conduct radio in particular. Traveling time from there to the most frequently required locations for interviews and research would be enormous, and some outsiders would be reluctant to come so far …

He went on to say:

I outlined my reservations briefly to the Board and they agreed with me immediately … it seems to me that the only possible decision was in accordance with the operational interests of the organisation, bearing in mind that its effect would be of indefinite duration.

The East Burwood project was stopped, and we set about exploring locations close to the city.

Mr Molomby’s knowledge and understanding of the operational requirements of the ABC, and his foresight, saved the ABC board from making a serious mistake. Eventually, the ABC’s Melbourne operations were consolidated at Southbank, in the city. I hope that senators opposite are taking note of this, because it is fair to say that this situation probably saved the ABC—and therefore the taxpayers—millions of dollars.

That staff-elected director used his broadcasting knowledge and understanding of the ABC and saved probably millions of dollars for Australian taxpayers. What logic: get rid of a position which has already, by its very existence, saved millions of dollars. This example from Mr Cassidy’s submission is in direct contrast with the reasons the minister has given for the abolition of the position. It is directly opposite. I will quote from the explanatory memorandum to the bill. It reads:

The election method creates a risk that a staff-elected Director will be expected by the constituents who elect him or her to place the interests of staff ahead of the interests of the ABC …

Yet Mr Molomby not only placed the interests of the ABC ahead of those of staff but also saved the corporation from a fiscal and logistical disaster. The explanatory memorandum, circulated by authority of the Hon. Helen Coonan, rubs more salt into the wound with its financial impact statement. It reads:

The Bill is not expected to have a significant financial impact on Commonwealth expenditure or revenue.

Well, Minister, that is not what history tells us.

If coalition senators were to read through the submissions made to the inquiry, they would see other examples of where the persons occupying the position of staff-elected directors have played significant and positive roles on the board. They would have to feel embarrassed about supporting this bill, knowing that the reason the government is putting forward for abolishing such a position is not, in reality, justified. Its reason of conflict of interest is casting a shadow over what many believe to be the real reason for the government moving to abolish the position of staff-elected director on the board—that is, that the position of staff-elected director is the one position that the government does not have control or influence over.

In the minority report of the inquiry into the bill, submitted by Labor, Greens and Democrats senators, concern was expressed about the overall state of the ABC as a collective operation. I would like to expand on this for a minute, because this is at the core of this bill’s intentions. The composition and method of appointment of the board is central to the ailments of the national broadcaster, and there are few areas left of the ABC that are not soaked in conservative bilge water. The ABC is one of the last great public institutions that has seen Australians through some of our darkest hours and united us in moments of triumph. It is a symbol of independent thought and transparency in a free society. A strong, independent media is a dying entity. The capacities, rights and strengths of genuine fourth estate journalism are in grave danger.

It was World Press Freedom Day last Thursday and the Australian Press Council used the day to air concerns about the state of the media. The chairman, Professor Ken McKinnon had this to say about the Howard government’s contempt for a free press:

During Prime Minister Howard’s regime, the Commonwealth has centralised power to an unprecedented degree and used the buzzword ‘security’ to erect a seamless protective wall around information flows.

Professor McKinnon does not exactly mince his words in his criticism, and the irony is not lost on me. The government does not care about the loose and unfounded allegations about the board’s composition. The duties of the board stipulated in section 8 of the Australian Broadcasting Corporation Act are quite clear about what is required from a board member.

There are nine positions on the ABC board, and they are filled by people who come from many different professional backgrounds. They all know that they are bound by the board’s protocol. It does not matter if their background is in civil and criminal law, as is the case with board member John Gallagher QC; or if they are the Chairman of Film Australia Limited, as is board member Steven Skala; or if they have a broadcasting background, like Ms Koval or the incumbent, Mr Dempster. They are all bound by the protocols, rules, directives—call them what you will; they are all bound by them. And it should be considered an asset to have a career broadcaster as part of the board structure.

During the Senate inquiry into this bill, there were a number of attacks on the integrity of the current staff-elected director. Prior to this there had been numerous other accusations about the staff-elected director by the government. If Senator Coonan had proof that any member of the ABC board was not upholding the protocols of the board, she had, and still has today, the power to remove them. If Senator Coonan believes that the current staff-elected director is in breach then she could enact section 18(1) of the ABC Act. Section 18(1) enables the Governor-General to remove—on advice from the government, of course—a misbehaving non-executive director from office. Aside from that, we all know it is relatively easy to sack people in Australia today. I do not really understand why the government need to go to the lengths of removing the entire position simply because they are not happy with the person currently tenured.

We know that is not the case, and again I state what to many is obvious. The truth is that the Howard government have introduced this bill because this is the one position on the ABC board that they cannot fill, cannot influence and cannot control. It is a simple equation really: if you cannot manipulate a board position—if you cannot fill it, if you cannot control it—what do you do? You get rid of it. That is really what this entire debate is about. It is about the Howard government’s calculated crusade to change our ABC and mould it into what they want—that is, a media outlet that will tell them what they want to hear and will not be critical of their agenda. It is a crusade that they have been waging against the broadcaster for many years now. The government have numerous fronts in this crusade; they are removing any existing traces of independent media on one front and opening up the market to those with the fattest chequebooks on the other.

I conclude by saying that the Australian Broadcasting Amendment Bill 2006 is not in the best interests of the Australian public, not in the best interests of free speech and not in the best interests of our national broadcaster. I will finish by letting the chamber reflect on the following comment by esteemed 20th century journalist Walter Lippmann:

The press is no substitute for institutions. It is like the beam of a searchlight that moves restlessly about, bringing one episode and then another out of darkness into vision. Men cannot do the work of the world by this light alone. They cannot govern society by episodes, incidents, and eruptions. It is only when they work by a steady light of their own, that the press, when it is turned upon them, reveals a situation intelligible enough for a popular decision. The theory of the free press is not that the truth will be presented completely or perfectly in any one instance but that the truth will emerge from free discussion.

Although this is a free discussion, the arrogance of this government ensures that we are seeing a narrow, ideological shadow covering the landscape. It is a shroud that is being imposed on us. The ABC Amendment Bill 2006 is another example of Howard’s way, with no redeeming features. Labor believes that there should be an open and transparent process for making appointments to the ABC board. At the present time, the staff-elected position is the one position that fulfils this criterion.

1:56 pm

Photo of Ruth WebberRuth Webber (WA, Australian Labor Party) Share this | | Hansard source

I would like to commence my remarks on the Australian Broadcasting Corporation Amendment Bill 2006. I believe this bill demonstrates this federal government’s complete inability to deal with independence of thought and action. It would seem that this is a government, and this is a minister, that is afraid of any form of dissent, so it has to legislate it out of being. This is a government that cannot handle alternative points of view or independence of action—a government so drunk with power, some would say, so overwhelmed by its own importance and so arrogant about the power given to it by its numbers in this place that it believes it can do what it likes without recourse to what is fair, what is decent or what is honourable.

This bill, as has been said by my colleagues earlier, will remove the position of the staff-elected director from the board of the Australian Broadcasting Corporation. The Australian Broadcasting Corporation Act at the moment states that the board of the ABC will consist of the managing director, the staff-elected director and no fewer than five and no more than seven other directors. This amendment will remove the staff-elected director from the board of the ABC.

What reasons has the government put forward to justify this action? The Minister for Communications, Information Technology and the Arts, Senator Coonan, claimed on 24 March this year:

As the staff-elected Director has been elected by staff rather than appointed, there have been claims that the position creates uncertainty about accountability.

To quote a television presenter from another network—using a well-known saying in the Australian vernacular these days—‘What the?’ The minister’s suggestion that, because a director is elected by staff as opposed to appointed by the minister, it makes their accountability uncertain is surely one that should make the annals of Australia’s most ridiculous assertions. The minister’s suggestion that a person appointed by the minister is more accountable than a person elected by the employees of an organisation is farcical. How does the method of a director’s appointment to a board determine their accountability? The method of a director’s appointment to a board does not determine that person’s accountability to the minister, the staff or the good of the corporation.

It is clear from all sides of this argument that there are clearly defined legal responsibilities, as alluded to earlier in this debate, that a director must undertake. In fact, the minister also said on 24 March this year:

However, there is a clear legal requirement on the staff-elected Director that means he or she has the same rights, duties and obligations as the other Directors, including to act in the interests of the ABC as a whole.

Surely that statement alone makes it clear that the means by which a director is appointed have absolutely nothing to do with the rights, duties and obligations that a person must discharge as a director. It is a fact that is enshrined in law, no matter how a director is appointed. If you are a director, no matter how you come to be appointed, you must act in the same prescribed manner as all other directors.

Debate interrupted.