Senate debates

Tuesday, 26 June 2012


Fair Work (Registered Organisations) Amendment Bill 2012; Second Reading

1:21 pm

Photo of Eric AbetzEric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | | Hansard source

An ex-union boss drawing up the rules for union bosses to be administered by an ex-union boss should be a laughable proposition, yet regrettably that is exactly what is being served up today in this guillotined debate on the Fair Work (Registered Organisations) Amendment Bill 2012 and, what is more, it is being served up by the government with a straight face. And we will get a gaggle of ex-union bosses opposite trying to justify the unjustifiable, if not by their words then by their votes. This bill has its genesis in the Craig Thomson scandal, a scandal that has so enveloped this government; that has fouled this government beyond repair—the scandalous support and succour given by the ALP to the member for Dobell, including the provision of legal advice to the tune of tens of thousands of dollars—and that saw him give false and misleading information to Fair Work Australia. The extraordinary efforts this Green-ALP alliance have gone to to keep the member for Dobell on political life support is the stuff of legends.

The member for Dobell in turn keeps this discredited government on life support. It is a truly symbiotic relationship. The facades, the forked tongues and the failure of ethical standards over the Thomson scandal have seen this government's reputation sink, and deservedly so. If the lie about the carbon tax was not enough, if the lie about same-sex marriage was not enough, then to round out the trifecta we have the Thomson saga—Mr Thomson, the ALP member for Dobell, in whom Ms Gillard expressed full confidence and continued to express full confidence. Then miraculously Ms Gillard, who always insisted Mr Thomson should not be prejudged, had Mr Thomson suspended from the ALP just days before the release of the Fair Work Australia report. Very interesting timing because it was a report that found the ALP member had misused the hard-earned union dues of workers on living the high life—for trips, for expensive hotels, for the services of escorts. These are findings the Prime Minister, the government and the Green alliance partners and the ACTU to date have refused to accept. They refuse to accept the findings. They are refusing to acknowledge that those findings are worthy even of note. It is not that they can find anything wrong with the findings; it is just that they do not like them. So in their desperation, we are told by Ms Gillard and the ALP, 'Don't prejudge Mr Thomson; it is not your role.'

We know consistency and integrity of argument and logical thinking have never been Labor's strong suit, but their attempts over the Thomson scandal are genuinely of gold medal proportions. Labor are breathtakingly and audaciously trying to tell us one thing by doing another. So we are told we should not prejudge Mr Thomson when we say that the government should not accept his vote. What Labor and the Greens deliberately ignore is that Fair Work have not made allegations against Mr Thomson; they have actually made findings, including that he gave false and misleading information whilst an ALP member of parliament and had the benefit of Labor funded lawyers to boot.

Despite this injunction not to prejudge Mr Thomson, what has Ms Gillard actually done? She suspended him from caucus and said he would not be re-endorsed, yet we are to believe that we are not to prejudge him. If he is not to be prejudged, can somebody opposite please explain during this debate why he has been suspended and why Ms Gillard has said that he will not be re-endorsed? Methinks chances are they have prejudged him—in fact, I withdraw that: they have not prejudged him, they have judged him on the strength of the findings of the Fair Work Australia report. Labor know that the Fair Work Australia report and findings are damning of Mr Thomson and the culture that existed in the Health Services Union. That Fair Work Australia delayed beyond reasonable excuse, that Fair Work Australia engaged in sophisticated sophistry—if that is not a tautology, that they refused to cooperate with police, and that Fair Work Australia refused to abide by freedom of information requests are all documented. This body was established by Ms Gillard and its personnel appointed by Ms Gillard, and surprisingly they have dragged their feet on this matter to such an extent that the initials of Fair Work Australia have gone into the Australian vernacular courtesy of Senator Nick Xenophon's creative mind. And whilst I am at it, I wish Senator Xenophon well and trust he recuperates.

With this background, let us look at the bill. Having announced the coalition's plan for better transparency and accountability of registered organisations, the hapless Minister for Employment and Workplace Relations, the would-be Prime Minister, was left embarrassed and flat-footed. So in an attempt to play catch-up, he announced 10 days later Labor's half-baked plan. That it was half-baked should not surprise. Exactly what Mr Shorten did was to take our policy—our plan to assist those over 50 who are unemployed and those wanting to move from a high-unemployment area to where there are more jobs—and bungle it and then announce it as government policy, all as his own idea. Mr Shorten sometimes reminds me of the kid who tries to copy the smart kid's work at school and then tries to improve on it, and as a result still fails. Not satisfied with a half-baked proposal, the Green-ALP alliance guillotine on this bill has meant that the parliament cannot consider this bill in an appropriate manner. What it shows is a contempt for proper process generally and in-depth analysis of this bill in particular.

We were told courtesy of a letter from the Leader of the Government in the Senate, Senator Evans, on 13 June that this particular bill needed to be rushed through because it was 'a budget bill or a key appropriation needing to be passed by 1 July 2012'. When the department was asked that at the Senate inquiry, that was debunked. Indeed, the department could not bring itself to say that the Leader of the Government in the Senate was right. Indeed, the evidence was that it is certainly not a budget related bill. Here we have again the ALP not even able to give it straight in this place as a justification why this bill needs to be rushed through. 'It is a budget measure; it has to be through by 1 July,' according to Senator Evans' letter to me of 13 June. It was completely and utterly debunked by the department. Do we have an apology from the Leader of the Government for misleading or trying it on? Absolutely not. Why? Because it is the standard stock in trade of the ALP. If you were willing to promise no carbon tax before an election and then do it, it is very easy to say something is a budget bill when in fact it is not and try to con the opposition. That is what is now infecting every aspect of this government. They simply cannot give a straight answer, and the people of Australia quite rightly have lost their trust in this government.

Let me talk about the truncated and guillotined nature of this legislation. The Australian Chamber of Commerce and Industry and the Master Builders Association have expressed their concern about the truncated timetable for the committee's process. Keeping in mind that we had less than one week from the Senate saying that we should look into this and report on this bill—less than one week—we were given about three hours of hearing on Friday whilst the parliament was still sitting, meaning that I and other senators had to absent ourselves from the chamber for that period.

The question is: what is the urgency of this bill? No argument has been made out. If this bill were to act retrospectively and reach back into the Health Services Union debacle, I could understand it, but this bill will only be proactive. There are no other investigations on foot, according to Fair Work Australia. Hence there is no need for the urgency. There would be nothing wrong with delaying this bill for another week or a fortnight. But in this sitting fortnight, this Senate will be guillotining 36 bills through the chamber. I wish some of the commentators did not have cramp in their fingers this sitting fortnight or that their keyboards were not malfunctioning. Those commentators were so condemnatory of the coalition between 2004 and 2007, when the Liberal-National party had control of the Senate and we guillotined 36 bills in that whole three-year period. That is what got those commentators' fingers very busy on their keyboards and column inch after column inch was written and published to condemn this abuse of the Senate by the Liberal and National parties. Surprisingly, when it is the Green-ALP alliance guillotining 36 bills, not in three years but in 10 sitting days, it is not worthy of fingers being applied to a keyboard to make comment on it. What is worse is that the 36 bills of this sitting fortnight will now make a grand total of 125 bills that have been guillotined by this Green-Labor alliance. We as a coalition say to the Australian people: next time you get a Senate ballot paper, ensure you protest vote with your Senate vote by voting for the coalition and not for the Green-Labor alliance that has abused this Senate like never before in its history.

One of the clauses of this bill is to allow cooperation by Fair Work Australia with the police. Every decent citizen does that. Every single public servant under the Public Service code of ethics is required to do so. This committee saw the very strong legal opinion of one of Australia's best industrial lawyers, Stuart Wood SC, which completely and utterly debunked the fabricated arguments from Fair Work Australia suggesting that they could not cooperate with police. We are told this is the legislation that is similar to that which existed before and therefore it is all Tony Abbott's fault. That seems to be the argument for everything these days. If the government mucks something up, it was Mr Abbott's fault. What Fair Work Australia did not want to disclose to us and finally had to was an email from Mr Doug Williams of 30 June—not 2012, not 2011, not 2010, but 2009. He was then the Industrial Registrar and Chief Executive of the Australian Industrial Relations Commission, acting under the same legislation. As he was leaving his job, he said this:

There should be a clear plan and actions arising from the outcome of the inquiries to date—

and he was talking about the Health Services Union inquiries—

including inter alia any actions and referrals to other authorities (e.g. to the police …

There was no legislative impediment on 30 June 2009 to refer these matters to the police. Indeed, in his email he concludes by saying:

I am happy to discuss these directions, but otherwise anticipate that the actions identified will be implemented expeditiously.

He further said that there was no need for further investigation to refer these matters to the police. That was the standard nearly three years ago. In four short days it will have been three years since those that are charged with the Health Services Union matter were told to report this matter to the police, and it was not. In some amazing sophistry we now have the government saying, 'Oh, we have got to amend the legislation to allow it.' We as a coalition will support that move, but can I say very clearly there is no need to amend the legislation—all it is doing is providing cover for the shonky workmanship and the delay of Fair Work Australia. Another thing that we as an opposition have very real concerns with is the penalty regime under this act. Most people cannot see a material difference—and I confess I am one of them—between a company director and a shareholder on the one hand and a trade union boss and a trade union member on the other hand. The company director, like the union boss, owes a fiduciary duty to the shareholder and the union member. If the company director were to be engaged in a certain course of conduct, that company director, for a malfeasance against shareholders, could confront a $200,000 personal fine or five years imprisonment—as it should be. However, if you are a trade union boss and you engage in similar conduct against your trade union membership, as the aforementioned company director did against the shareholder, guess what your maximum penalty is? No period of imprisonment whatsoever and not a fine of $200,000, not a fine of $100,000, not even a fine of $10,000 but a fine of $6,600. And guess what happened in the other place when we moved amendments to increase the penalty? Guess who was one of the first people to ensure they voted against the increased penalty—not that it would have applied to him—but the member for Dobell, in concert with the ALP and the Greens member in that other place.

We can try to make up all sorts of arguments, but I know the Australian people say that when something is wrong, it is wrong, and just because you are a union boss does not mean that you owe a lesser obligation to your membership than a company director does to his or her shareholders. Indeed, we were told at the Senate hearing, 'Poor trade unions—we are voluntary organisations. We are little businesses. We are not like these big companies.' Excuse me? One state division of the Electrical Trades Union has assets of $42 million and another trade union has assets of $20-plus million. These are not small businesses, as indeed was witnessed by the Fair Work Australia report into Mr Craig Thomson and the Health Services Union. How else could you rip off hundreds of thousands of dollars in a matter of a few years unless there was a substantial financial turnover?

Time is short. I cannot refer to all the matters that I would have wanted to and, given that there will not be a committee stage, I will not be able to canvass matters further. But what this bill highlights is this: Labor seek to sidestep issues whilst pretending they are dealing with them. Labor seek to talk tough but go soft. This amendment to the Fair Work (Registered Organisations) Act is exactly in that category—pretending to do something when they are not. Can I ask those opposite: how will a $6,600 penalty dissuade somebody who is so minded from ripping off their union to the tune of hundreds of thousands of dollars, as Mr Thomson did? (Time expired)

Photo of Doug CameronDoug Cameron (NSW, Australian Labor Party) Share this | | Hansard source

Senator Abetz, I understand that you are seeking to move an amendment on sheet 7247 to the second reading motion, circulated in your name.

1:41 pm

Photo of Eric AbetzEric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | | Hansard source

I move:

  At the end of the motion, add:

     but the Senate notes the Government's failure to:

  (a)   establish an independent Registered Organisations Commission to:

     (i)   enforce and police the reporting and compliance obligations;

     (ii)   provide information to members of registered organisations about their rights and act as the body to receive complaints from their members;

     (iii)   educate registered organisations about the new obligations that apply to them; and

     (iv)   absorb the role of registered organisations enforcer and investigator, currently held by the General Manager of Fair Work Australia;

  (b)   ensure registered organisations face the same accountability and transparency measures as required of companies and their directors under the Corporations Act 2001;

  (c)   ensure registered organisations face the same penalties as companies and their directors under the Corporations Act 2001;

  (d)   express its confidence in the findings of Fair Work Australia's investigation into the Health Services Union National Office; and

  (e)   conduct a Regulation Impact Statement for the bill;

and calls on the Government to conduct a review of the amendments made by the bill within two years after it receives the Royal Assent in accordance with Office of Best Practice Regulation practices.

Photo of Gavin MarshallGavin Marshall (Victoria, Australian Labor Party) Share this | | Hansard source

I also rise to speak on the Fair Work (Registered Organisations) Amendment Bill 2012. In my contribution I will address some of the comments Senator Abetz made. Firstly, let me give an important summary, one that was a little bit missed in Senator Abetz's contribution, about the purpose of the bill and what it is for and why it is important for the government to act at this point in time.

It does surprise me a little bit that the opposition seems to want to criticise the government when they do things and it wants to criticise the government when they do not do things. When the government move to act and tighten up the laws in relation to registered organisations, we are criticised for doing so. But if we had not moved to tighten up some of the laws that apply to registered organisations, we would have been accused of failing to do so. The opposition, once again, seeks to walk both sides of the road and there is complete inconsistency with what it says.

This bill, as we know, seeks to increase the accountability—financial and otherwise—of registered organisations and their office holders. The bill will improve the way that investigations into breaches of the registered organisations provisions are conducted. The proposed amendments in the bill seek to achieve this aim. There will be a requirement that the rules of all registered organisations must deal with disclosure of remuneration and pecuniary and financial interests. There is a threefold increase to civil penalties under the Fair Work (Registered Organisations) Act. There is a strengthening of the investigative powers of Fair Work Australia and there is a requirement that education and training be provided to officials and registered organisations about their governance and accounting obligations. All these things are things that the opposition, in various ways, have raised as issues that need to be dealt with, yet when the government seek to introduce amendments to the bill to deal with these issues, they criticise us for doing so.

Photo of Michaelia CashMichaelia Cash (WA, Liberal Party, Shadow Parliamentary Secretary for Immigration) Share this | | Hansard source

It's not tough enough—you know it's not tough enough. Where are the imprisonment provisions?

Photo of Gavin MarshallGavin Marshall (Victoria, Australian Labor Party) Share this | | Hansard source

I notice that Senator Cash is already on her high horse. I am sure she will get out her membership of the HR Nicholls Society and start flashing that around to us at any moment now.

Registered organisations include unions and employer associations, and the Education, Employment and Workplace Relations Legislation Committee, of which I am chair, heard from both in an inquiry which we conducted last Friday. While, ideally, the committee would always like more time to deal with any piece of legislation that comes before the committee, the Senate as usual was up to the challenge; the committee was up to the challenge. We heard from a number of witnesses, some called by the opposition and some called by the government, and we were able to analyse this bill and its effect. We heard from a good cross-section of the community, and I will go to some of those submissions in a minute. All the submissions to the inquiry expressed in principle support for increased accountability for registered organisations and their office holders. It is worth noting at this point in time that these rules, these regulations, these laws that apply to registered organisations are in fact laws that were put in place by Mr Tony Abbott when he was minister for industrial relations in the previous government. This is the first time that these laws that were originally introduced by Mr Abbott have been updated. They are being updated because of some obvious circumstances, which I will go into in a moment, which have undermined confidence in the ability of those laws to deal with governance issues in some registered organisations, and that is a shame.

The people who made representations about the bill included, for instance, the Australian Industry Group, which represents employers. They expressed support for the bill, agreeing on the importance of greater disclosure by registered organisations. The Australian Council of Trade Unions expressed their support for the bill and its measures to address issues arising from the recent investigation into the Health Services Union branches. This is important. The Australian Industry Group is itself a registered organisation that represents other registered organisations. The ACTU is not a registered organisation but is a peak body that represents registered organisations under federal laws and various state laws.

It is no secret that public confidence in registered organisations has recently been undermined by the actions of a small number of officials in some parts of the HSU. We do not want to go into the proposition that Senator Abetz puts to us that the Senate should decide the guilt or otherwise of individuals involved in that. That will ultimately be a matter for the courts in various jurisdictions, and that should happen and take its proper course. But what it has highlighted is that there are serious governance issues with that union that clearly need to be addressed. Again, instead of the opposition attacking this government for actually doing something about it, they should be commending this government for acting quickly and appropriately to address some of those issues.

I was very pleased to hear the testimony of the Assistant Secretary of the ACTU, Mr Tim Lyons. Mr Lyons's view was that the package of measures contained in the bill will collectively address the underlying failings that became apparent during the recent investigation by Fair Work Australia. Certainly as a union member and a passionate believer in the role that unions play, there is no-one who feels more strongly than me that the overwhelmingly professional and honourable work of registered organisations should not be tainted by the actions of a few. It is in that spirit that I support this bill absolutely. I do not think that there are any issues with the vast majority of unions or other registered organisations such as employer organisations in raising the standards of governance and disclosure. I think that is proper and appropriate. There is a tripling of the current fines that, as I indicated, were put in place firstly some time ago when Mr Abbott was industrial relations minister in the previous Howard government. There are now much more rigorous disclosure provisions. All these things are very important.

The bill also enables Fair Work Australia to behave the way I think we would like them to be able to behave. Senator Abetz talks about Stuart Wood's advice that Fair Work Australia were able to directly disclose to the policing authorities matters contained in their investigation. Of course, whenever there are legal disputes, half of the advice is always wrong. When you have two legal opinions and they are contradictory opinions, one is going to be right and one is going to be wrong. Fair Work Australia had advice to say that they could not do that directly. Ultimately they did achieve that result by going through the Commonwealth Director of Public Prosecutions, so the report and all the supporting documentation has in fact been provided to the police authorities in both New South Wales and Victoria. It did get there, but the problem we had is that Fair Work Australia felt constrained by their legislation in that they were not able to do that directly.

In part, the position is supported by Mr John Lloyd, who was the former Commissioner of the Australian Building and Construction Commission. At the hearing where Mr John Lloyd appeared, and I will talk about his submission in more detail later, he indicated that the act that governed his commissionership—the Australian building improvement act, I think it was called—specifically allowed for him as Commissioner of the ABCC to hand over investigative material and evidence to the police forces in the relevant states. So in many ways the fact that there were specific provisions in that bill to allow for that disclosure probably supports Fair Work Australia's position. But, again, I am not a lawyer—thank heavens, most people would say—and I do not want to get into which lawyer was right in the opinion that they gave. What is important is that the government has moved to clarify the situation to ensure that Fair Work Australia can provide any evidence it collects to the police. Again, that is something the opposition want to criticise, but when we go and do it they criticise us for doing it too. It seems you cannot win with this opposition. You are dammed if you do and you are dammed if you don't.

This issue itself was the subject of a further Senate estimates hearing and Senator Abetz talked about the fact that Mr Doug Williams had said in a memo that there should be an ability to provide some information arising from the investigation to the police. This was portrayed by Senator Abetz and others through the press as a 'smoking gun'. As chair of that committee in estimates, I recalled Fair Work Australia at the request of the opposition to answer more questions about that detail. The smoking gun turned into an empty water pistol. That is all it was. There was no smoke; there was no gun. It was an absolute fizzer. There were three hours of questioning about the smoking gun, as it was portrayed, and it was an absolute fizzle. When the officers were asked about that issue, they answered the questions and left the opposition absolutely flat-footed and with hollow accusations that went nowhere. Senator Abetz now complains, 'Why didn't the press follow that matter and other matters more fully?' It is because the press were watching too and they saw it was a no smoking gun. It was a complete beat-up. The officers acted appropriately in every instance and that was obvious to everyone who was watching the committee. It is important to understand that Senator Abetz wants to argue, as other people who submitted to the committee argued, that registered organisations should be treated the same way as corporations. It has to be understood that these are constitutional matters—again, reminding people I am not a lawyer; I will not give constitutional advice about trading corporations. Even some of the people on the other side will understand that registered organisations are very different to corporations that trade for profit. Unions are organisations that exist to serve their members.

Photo of Michaelia CashMichaelia Cash (WA, Liberal Party, Shadow Parliamentary Secretary for Immigration) Share this | | Hansard source

Oh, really?

Photo of Gavin MarshallGavin Marshall (Victoria, Australian Labor Party) Share this | | Hansard source

Yes, really, Senator Cash.

Photo of Michaelia CashMichaelia Cash (WA, Liberal Party, Shadow Parliamentary Secretary for Immigration) Share this | | Hansard source

Or to rob them blind.

Photo of Gavin MarshallGavin Marshall (Victoria, Australian Labor Party) Share this | | Hansard source

If you had any understanding of unions or anything else to do with industrial relations, you would not be so quick to step in with your mocking contributions. You really know very little about these matters at all. Just because you are over the other side and somebody has given you a speech to read out to filibuster for the rest of the evening certainly does not mean that you or many of your colleagues do know about these matters. I see the guilty look on your face; did I get it in one?

Photo of Doug CameronDoug Cameron (NSW, Australian Labor Party) Share this | | Hansard source

Senator Marshall, address your comments through the chair.

Photo of Gavin MarshallGavin Marshall (Victoria, Australian Labor Party) Share this | | Hansard source

Through you, Mr Acting Deputy President, I think I hit it in one. Someone has given Senator Cash a speech to read out here to filibuster for the rest of the day so that, again, the opposition can get up and complain that, 'We have had 20 speakers on this bill and we do not have time for a committee stage.' For these sorts of bills on any other occasion you would have a couple of speakers and you would support the government because you know the government is actually doing the right thing.

Just for your edification, Senator Cash, let me explain to you how unions are not-for-profit organisations. They do not operate for the purpose of having business or trading at a profit. In the end, the Corporations Law is fundamentally designed to regulate businesses that turn a profit or, even if they are not-for-profit businesses, are otherwise engaged in trading. Unions do not participate in businesses. They are not a business. Unions do not have shareholders and they do not have customers. They have members. Accountability and transparency need to be delivered back to members. That is best done by specialist legislation. It is how it has always been done in Australia. It is best done by having a regulatory regime that is focused on the specific nature of an industrial organisation.

The argument that the opposition runs is that we should, in fact, have registered organisations governed by the Corporations Act. It has millions of businesses within it, but it will somehow deliver greater accountability and greater regulation than a specialist regulator that simply deals with the fewer than 200 registered organisations in this country. It makes no sense and it is illogical to suggest that regulation of registered organisations would be better dealt with under the Corporations Law. It clearly would not. It is simply another furphy.

We also heard Senator Abetz refer to a number of organisations that could have appeared before the committee. He mentioned the MBA. But the Liberal Party only asked for three people to appear before the committee. They asked for Mr Doug Williams, a member of the HR Nicholls Society, they asked for Mr John Lloyd, a member of the HR Nicholls Society, and they asked for Stuart Wood QC, a member of the HR Nicholls Society, to appear. Maybe we could have just asked the HR Nicholls Society to appear in its own right instead of having members of the HR Nicholls Society appear. It was then left to the government members of the committee to actually ask employer organisations and unions to appear. It was left to the government senators to ask for registered organisations to appear. So, in the end, it was the government members of the committee that invited ACCI, the AiG and the ACTU to appear.

The one member of the HR Nicholls Society that took up the offer to appear was Mr John Lloyd. Mr John Lloyd's evidence was quite interesting, but the fact that he came to lecture the Senate on how registered organisations should govern themselves got a bit problematic for him at the end of it. Mr Lloyd, a prominent member of the HR Nicholls Society, is now a director of the IPA, a right-wing conservative think tank. He was telling the Senate how registered organisations should govern themselves. But when I asked him, 'Who are members of the IPA?' he said: 'They are just people who agree to membership. They are people from anywhere in Australia. They can just donate money. Anyone can join and donate money.' I asked, 'Is it a company?' He said: 'I'm not too sure how it is set up. There is a board of the IPA. I think it is just an organisation. It is not a company, I do not think, but I am not sure of that.' I said, 'You are a director of the IPA and you do not know how it is set up.' Mr Lloyd said: 'I know there is a board. I do not think there is a corporate structure.' Here was a director of the IPA lecturing the Senate on how registered organisations should be set up, but he does not even know how an organisation that he is a director of is governed. He does not know whether it is a company. He does not know whether it is an organisation. He does not know what it is. If you do not know what a company or an organisation is that you are a director of, how do you know what rules govern it? How do you know how to govern yourself? How do you know what rules govern that?

Here was a guy, the HR Nicholls Society champion, John Howard's Work Choices spear thrower, coming here while not knowing how his own organisation is governed. The hypocrisy of the people who the Liberal Party get to come and run their political agenda before Senate committees is absolutely breathtaking. Mr John Lloyd needs to get over himself. He needs to work out how his own organisation is governed and what legal rules apply to it before he comes lecturing us about what we are doing in this place.

Debate interrupted.