Chris Evans (WA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I was going to ask the Minister for the Arts and Sport some detailed questions relating to clause 566-20, ‘Privilege against self-incrimination not available to bodies corporate in certain proceedings’, which I am sure he is on top of, but I will perhaps leave that for today and move on to some broader issues.

Rod Kemp (Victoria, Liberal Party, Minister for the Arts and Sport) Share this | Link to this | Hansard source

We would be happy to take that one on notice.

Chris Evans (WA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I am sure you would. As I say, I have difficulty lifting the bill let alone dealing with it. I appreciate the minister made some remarks about the registrar reviewing the implementation of the act. That will be helpful. I also flag, though, as we did in the second reading amendment, that we want to ensure there is monitoring of the implementation. While I take what the minister said in good faith, we will be keen to make sure the monitoring is sufficient and also that there is some sort of independent assessment of that. If we are not satisfied with the level of monitoring, the opposition may well seek to pursue that at estimates or by a review of the bill by the Senate committee after some period of time. As I said, there is no motive other than to be assured that what we think we are doing today happens and to be very clear about the experience of those Aboriginal corporations with the new act, because it is designed to assist them and we do not want to find out too late if there are problems with that. I formally move amendment (1) on sheet 5096:

(1)    Clause 246-25, page 195 (line 20), omit “2 years”, substitute “3 years”.

This is an amendment which seeks to extend the limit on the maximum term of appointment for directors from two to three years. There is no limit on the maximum term of appointment for directors in mainstream Corporations Law and, while it may be appropriate to encourage shorter terms to enhanced accountability, it is also important to encourage stability in corporate governance. Labor considers that three years would be a more reasonable limit to provide that stability. The point was made by, I think, the North Queensland Land Council in its comprehensive submission to the Senate inquiry.

The parliamentary amendments have made it possible for corporations to seek an exemption from this limit, so we are allowing exemption, but we are insisting on a two-year limit. Labor supports the option for exemption but thinks it would still be preferable for the limit to be increased so there are fewer organisations having to undergo an unnecessary exemption process. It may not seem a huge issue, but it is one of those issues that we thought was worth pursuing. One of the problems in these corporations is the issue of stability and corporate knowledge. We ought to be doing everything we can to build on that and not limit it.

Rod Kemp (Victoria, Liberal Party, Minister for the Arts and Sport) Share this | Link to this | Hansard source

We have listened very carefully to Senator Evans’s comments. In many ways they are on-balance decisions. The government’s view is that the maximum term of two years makes directors more accountable to members and reduces the chance of a corporation becoming a closed shop controlled by one particular group. But it is true that some stable corporations with well-established governance practices may benefit from longer term directors. We agree with Senator Evans on that point. As has been noted by Senator Evans, the government has responded to this feedback by making the two-year term exemptible. We think that deals with the problem. I do not think there is a big difference between us, but the government has looked carefully at this issue and will be opposing the amendment moved by Senator Evans.

Chris Evans (WA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I look forward to the government moving such an amendment for the appointment of directors in mainstream Corporations Law, given their concern about those issues.

Question negatived.

I move opposition amendment (2) on sheet 5096:

(2)    Clause 487-10, page 392 (lines 7 to 11), omit paragraphs (1)(a) and (b), substitute:

             (a)    give the corporation notice in writing including the particulars of the grounds that would justify such a determination; and

             (b)    invite the corporation to show cause, within a reasonable period specified in the notice, why the determination should not be made; and

             (c)    consider any representations the corporation makes to the Registrar within that period.

Amendment (2) is intended to require that the registrar provide reasons for a determination to appoint a special administrator. This is an important issue. It is one we are concerned about and is something that I hope the government takes seriously. The bill improves on the Aboriginal Councils and Associations Act by requiring the registrar to give the corporation an opportunity to show cause why the registrar should not appoint a special administrator. Under the old regime it was at the discretion of the registrar to seek the corporation’s opinion, so I accept that that is a beneficial change. However, what is missing is an obligation on the registrar to specify the grounds that would justify such an appointment. It seems to me it is not unreasonable that someone knows why it is you are intervening in their management of a corporation and to justify that intervention.

The requirement to give reasons is common in administrative law to ensure procedural fairness. Outlining the registrar’s concerns would ensure that the corporation has a full opportunity to respond to those concerns. It also provides more transparency and inspires confidence in the process that can often be thwarted by misunderstanding. It is important to ensure that, in moving to the corporate model, as we are today, we do not actually seek to impose on Indigenous corporations requirements that are unreasonable or that are more punitive than we apply more generally, while recognising the differences in the way they operate. It is also important that we make sure that those corporations are treated with the same sort of procedural fairness and opportunity that we would expect for ourselves or for other corporations in the community. The lack of an obligation on the registrar to specify the grounds upon which they are intervening and appointing an administrator is a flaw in the legislation.

As I said, the opportunity to show cause is a good one, because a lot of Indigenous people have been concerned about the current system and the failure of the registrar to actually have to justify that very serious intervention. The requirement to give reasons is, as I say, very common in administrative law. It seems to me to be an issue of basic procedural fairness. I have not heard an argument as to why it should not be applied in this case. It is a very serious step to appoint an administrator—to take the corporation out of the control of the elected directors, out of the control of the people who are providing the services and managing the organisation. I am not saying that it would necessarily be used arbitrarily, but it seems to me it is a basic element of procedural fairness that reasons are provided. So Labor would appreciate support for the amendment to ensure that those reasons are made and specified to the corporation before such an intervention is enacted.

Rod Kemp (Victoria, Liberal Party, Minister for the Arts and Sport) Share this | Link to this | Hansard source

Senator Evans, I have pressed my advisers on this issue. I note your concerns in this area, and the advice I have received is that the extra requirements in this amendment are really not necessary. It is the registrar’s current practice to provide particulars in a show cause notice—in fact, I understand this is required under administrative law—so these extra requirements you are proposing are simply not necessary. The current practice will, of course, continue as it is necessary, to pick up another one of your points, in order to provide procedural fairness. While we understand your sentiment and we understand your concerns, the advice I have received makes it very clear that your goals are already being achieved under the current arrangements and, therefore, this amendment is not necessary.

Chris Evans (WA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I thank the minister for his response, but, quite frankly, assuring me about current practice is not the same as this parliament determining on a new act. We have the capacity today to determine what the law ought to be, so the question of current practice, quite frankly, carries no weight with me. Our job today is to establish a new law, so it seems to me the practice argument does not wash.

The second argument you address is the question of admin law. There is some strength to that proposition, but there is a whole range of acts passed by this parliament, carried by this government, which have sought to stipulate those sorts of provisions. There are a range of provisions provided in this act which seek to regulate this area that you could also argue are supported by common law and that would not necessarily require a specific provision. And if you can have 600 pages of legislation—600 pages of regulation, requirements et cetera—I think a request to add one little bit that makes it clear that the registrar is required to stipulate on what grounds they intervene in an Indigenous corporation is not asking too much. It is not a big ask. It is a protection for the organisation that is warranted; it is a key part of procedural fairness.

As I said, there is some strength to your argument about current administrative law or common law providing support for that sort of process. But I would argue there is a fair bit in this that you could argue the same thing for but the government has sought to cover off on; the government has thought it worth stipulating. We think this is worth stipulating. We urge the government to give serious consideration to that. I do not find the government’s response convincing, and I think Indigenous organisations would prefer the assurance that that sort of procedural fairness is stipulated in the act.

In fact, there is a gap on page 573, so if we add that clause we will not even add a page; we will still only have 573 pages. Thankfully, we got the legislation on 572 pages, plus one little paragraph. So if we add this amendment we do not chop down any more trees, we do not add any great complexity to this new simplified version of the organisation, but we do tell Aboriginal people that they will get procedural fairness, that we will not be coming in and overturning democratic control over their organisations without ensuring procedural fairness. So why don’t you have a crack at providing some reassurance other than the reassurance you provided in the committee stage by way of contribution, which of course may not be as widely read and heard as we would hope. I urge the government to think about making one small concession to being clear that Indigenous corporations and Indigenous people are treated with that sort of procedural fairness, which the minister assures me will apply but will not be explicit.

Rod Kemp (Victoria, Liberal Party, Minister for the Arts and Sport) Share this | Link to this | Hansard source

I can understand Senator Evans’s slight embarrassment: having berated us for the length of the bill, he now wants to add to the bill. I thought that was a clever ploy, actually; I rather enjoyed how you dealt with that issue, having complained about the size of the bill and then wanting to add to it. To be quite frank, I thought that was quite clever, if not persuasive.

What assurances can we give? People will look closely at what I have said in the second reading debate. They will look at administrative law, which you indicate does have some weight. It is true to say the minority report of the committee did not support this particular amendment, probably for the reasons I have stated. Senator, as I always say, we listen carefully to your arguments. We are a consultative government; we do listen to people, but we think the objectives you are seeking are in fact met. We think that people will have those assurances of procedural fairness and that reasons will be given on the show cause notice. After much deliberation, I am sorry to inform you that we will not be accepting your amendment.

Chris Evans (WA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I am disappointed the government could not make even one small concession to the concerns raised. I know they have absolute power, but a bit of respect for the parliamentary process would not go astray on occasions. And, if you are going to tell people you are listening, generally people regard that somehow, on occasions, one might change one’s behaviour if one is genuinely listening. But to be listening and never change one’s behaviour is not in accordance with my understanding of listening. As I said, we try to be constructive about this bill, as with all others, and we have tried to assist its implementation. I do not think it would hurt the government to occasionally listen to those concerns and to actually act rather than just reassure us they are listening.

I did want to say that I do not know what the minister’s point was when he said that the Labor senators did not support this. It was not explicitly a point made in the report if that is what he is trying to say, but I can assure him that Labor senators do support the amendment. But, as you know, in a short inquiry with a complex bill, Labor senators did not attempt—nor did government senators attempt—to deal with every issue in the bill. The overall recommendation of the committee was to monitor the new regime, and it also made known a number of other concerns in its report.

Anyway, it is clear that the government are not going to provide that reassurance. I am not sure that the minister’s broad reassurance regarding the amendment will be that widely circulated in Indigenous corporations. I think they will have enough trouble dealing with the 600 pages of legislation without adding to their reading. But I think it is an important amendment. I do press the point that it does make procedural fairness explicit. It seems to me that, if the government say that it happens anyway, it is not too much to ask that they actually provide that assurance in the legislation. I am disappointed that listening does not impact on behaviour.

Question negatived.

by leave—I move opposition amendments (3) and (4) on sheet 5096 together:

(3)    Clause 658-1, page 523 (after line 33), after paragraph (1)(i), insert:

                 (ia)   to inform the Minister about any issues affecting the independence of the office.

(4)    Clause 658-5, page 524 (line 28), at the end of clause 658-5, add:

         ; and (f)   to maintain the independence and integrity of the office in the exercise of his or her functions.

                 (ia)   to inform the Minister about any issues affecting the independence of the office.

Labor is moving to stipulate the independence of the registrar and the registrar’s office. Labor notes that the bill increases the independence of the registrar by transforming the position into a principle executive officer as opposed to a public servant, and that means that the remuneration and terms of conditions will be set by the Remuneration Tribunal, not by the minister. That is a small improvement in the sense of independence of the office. Labor also notes the structural reforms that have happened within the Department of Families, Community Services and Indigenous Affairs and that there are new reporting requirements for the registrar in terms of reporting to the corporate section of the department rather than directly to the OIPC. But these things changed quickly, and they may change back quickly. The one thing we know about Indigenous policy is that it is constantly changing.

More fundamentally, the registrar is still appointed by the minister and there is still scope for ministerial interference in the decision making of the registrar. There is serious unease on this side of the chamber about the Mutitjulu intervention. Although I do not want to go to the specifics of the case, I think we are all aware that there are court proceedings occurring in relation to that. I am not going to the circumstances of what is occurring in Mutitjulu, but there is concern about whether the registrar’s office has enough independence, particularly given this sort of activist minister with a hands-on approach, if I can put it in its kindest form. Labor are seeking to enunciate and clarify the independence of the registrar in the bill. We are seeking to include within the aims of the registrar a clause that says:

... to maintain the independence and integrity of the office in the exercise of his or her functions.

We are also seeking to include within the list of functions of the registrar a clause that says:

... to inform the Minister about any issues affecting the independence of the office.

This statutory function is identical to that of the Office of Evaluation and Audit (Indigenous Programs). The independence of that office is central to its integrity, so I think it is a useful point of reference. The Office of Evaluation and Audit (Indigenous Programs) is another part of the checks and balances within this area of policy. As I said, it is the statutory function that governs the operations of that office. We think it would be useful to have that same protection included in this bill. As I said in my speech on the second reading, this is not a reflection on the current registrar or previous registrars, but Labor want to make sure that the office’s independence is protected.

Rod Kemp (Victoria, Liberal Party, Minister for the Arts and Sport) Share this | Link to this | Hansard source

I want to make a brief comment on what I thought was a somewhat unkind comment by Senator Evans. He queried the government’s listening and suggested that it required action to be taken. Of course, having consulted and listened, you make a judgement about whether this will lead to a change. But I draw your attention to no greater authority than yourself, Senator Evans, in your remarks in your speech on the second reading, where you indicated that the government had made some changes which you felt improved the bill. I feel that did demonstrate an ability to listen and consult.

We have listened to you again, Senator Evans, and perhaps I can shed some light on this and give some assurance to you. You are worried about whether the registrar, in carrying out his or her responsibilities under the act, will be independent of the government, and you seek to buttress that. But I suggest to you that, as far as we are concerned, it goes without saying that the registrar would raise with the minister any matters which might affect the registrar’s proper discharge of his or her duties. We are very keen, as you are, to maintain the independence and integrity of the registrar, and we believe the bill provides additional safeguards to ensure the independence of the registrar. The registrar will be appointed for the term set out in his or her instrument of appointment. Termination of the registrar’s appointment is limited to the grounds set out in the act—for example, misbehaviour or physical or mental incapacity.

We believe measures in the bill are consistent with the Uhrig review’s recommendations on governance arrangements for statutory authorities and office holders. So, again, we do not query what Labor is seeking to achieve, but, to be quite frank, we think this has already been achieved under the act. Noting your relentless berating of us for the size of the act, we are therefore loath to add to the act. We have listened to you on that score as well, Senator Evans!

Question negatived.

Chris Evans (WA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I do not want to get involved in nitpicking with the minister, but he just said, ‘We’ve just added some amendments but we’d be loath to add any’—I am not sure which it is. As I say, with one small clause in 600 pages the minister could have been magnanimous. Clearly he is not able to make that decision; otherwise I am sure it would have been agreed to.

Rod Kemp (Victoria, Liberal Party, Minister for the Arts and Sport) Share this | Link to this | Hansard source

Senator Kemp interjecting—

Chris Evans (WA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Yes, it is all his advisers’ fault, I am sure. I always found Senator Kemp to be much more reasonable and accommodating, so I was surprised by his refusal. Since he started making retirement plans he has been much more accommodating and relaxed! I move opposition amendment (5) on sheet 5096:

(5)    Page 524 (after line 28), after clause 658-5, insert:

658-6 Exemption orders to be responded to expeditiously

For the purposes of paragraph 658-5(b), the Registrar must provide a response within a reasonable period to any application for exemption from the operation of this Act to ensure that the applicant corporation is not unduly burdened by uncertainty or ongoing and inappropriate compliance requirements.

This amendment requires that the registrar respond to exemption applications within a reasonable period to ensure that a relevant corporation is not unduly burdened by uncertainty. I am sure the minister will assure me that practice and other matters will ensure this happens, but forgive me for seeking more certainty.

The structure of the bill provides a default setting of regulation, part of which can be avoided by corporations through the exemption process, which we discussed earlier. The exemption process is the key to the bill’s strong flexibility, but obviously there may be other consequences. Depending on the level of applications, the exemption processes may create unnecessary bureaucratic layers for corporations or place a burden on the resources of ORAC. They may also create some uncertainty for Indigenous corporations and prolong onerous or inappropriate requirements if their applications are not treated expeditiously.

The exemption order provisions in the bill enable the corporations to make an application to the registrar but do not require the registrar to respond unless he or she agrees to make an exemption order. Labor’s amendment seeks to ensure that the registrar provides a response, whether written or otherwise, within a reasonable period. It just ensures that the applicant corporation is not unduly burdened by uncertainty or inappropriate compliance requirements. It is a small change which we think would ensure that the registrar is required to respond within a reasonable period and it makes it clear that the corporation can expect a response within a reasonable period, which provides them with certainty and ensures that the efficiency of the office is guaranteed.

Rod Kemp (Victoria, Liberal Party, Minister for the Arts and Sport) Share this | Link to this | Hansard source

Amidst the many talents of Senator Evans we can now add ESP. I think you have actually been able to predict my response, Senator, and for that I commend you, though it will not make you any happier. I have consulted closely with my advisers, whom you chanced to mention, and they assure me that this extra requirement is not necessary. The point is made that decisions of the registrar will be subject to judicial review in the Federal Court or the merits review and administrative appeals tribunals. These review rights include the ground that there has been an unreasonable delay in making the decision. I am further assured that the registrar’s timely responses will continue under this act, so I regret to inform you, Senator, we will not be accepting your amendment.

Question negatived.

Bill agreed to.

CORPORATIONS (ABORIGINAL AND TORRES STRAIT ISLANDER) CONSEQUENTIAL, TRANSITIONAL AND OTHER MEASURES BILL 2006

CORPORATIONS AMENDMENT (ABORIGINAL AND TORRES STRAIT ISLANDER CORPORATIONS) BILL 2006

Bills—by leave—taken together and as a whole.

Chris Evans (WA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I am running up the white flag. The government is clearly not in the mood to listen to reasoned and rational argument, so I am wasting my time.

Bills agreed to.

Bills reported without amendment; report adopted.