Thursday, 22 November 2012
Equal Opportunity for Women in the Workplace Amendment Bill 2012; In Committee
Minister, I turn to the minimum standards. The explanatory memorandum states that before 1 April 2014 the minister will by legislative instrument set minimum standards in relation to specified gender equality indicators, specified relevant employees and specified reporting periods. You will be aware that there has been a three-year lead time to this legislation, along with the fact that it has been on the government's legislative agenda for some time this year. Could you please advise the Senate of what progress the minister has made in relation to the development of the minimum standards to date.
If the agency has been undertaking research, what research has been undertaken by the agency to date? I will ask that question again: the minister in her answer to me stated that the agency has been undertaking research to date in relation to the minimum standards. Would the minister be kind enough to advise the Senate what research has been undertaken by the agency to date, given the fact that there was a three-year lead-up in relation to this legislation and the legislation has been on the government's agenda for the majority of this year. Also, the relevant reporting period that employers will be reporting under actually commenced approximately three or four months ago.
I am advised that the work to date has primarily involved academic research, but I am obviously able, if the senator would like a more detailed briefing on this after the passage, to arrange such a briefing.
That would be appreciated, Minister. If the academic research itself that has been reviewed could be tabled, that would also be appreciated. I turn to the regulatory burden that will be imposed upon businesses as a result of this legislation. What is the expected regulatory compliance cost that businesses will face as a result of this legislation passing?
Could the minister elaborate on the internal cost to each organisation and not just on the reporting requirements themselves? If you cannot elaborate, you will not elaborate or there is no further information to be provided, please say so for the Hansard record.
The minister, I am sure, is aware that in a number of the submissions presented during the KPMG inquiry and in relation to the Senate inquiry, some businesses raised the issue of an increased regulatory compliance. Again I ask: on the basis that these issues have been raised during the development of the legislation and during the inquiry into the legislation, has the government's task force to reduce red tape approved of this legislation?
I am the minister for deregulation and I am happy to explain to the senator on another occasion the regulatory assessment framework that the government has put in place. Under that framework there is a regulation impact statement required for significant reforms. That is included in the explanatory memorandum that the senator would have, which really does go through the issues that she is referring to.
They are different functions. I realise that the senator, despite the fact that I thought she was going to try and be amenable to resolving this legislation speedily, wants to spend a lot of time on a Thursday night asking questions that she knows the answer to, but they are different processes. There is a very substantial amount of reform in relation to regulation, which includes the Milliner-Borthwick review which I initiated and the COAG process. Those processes are not relevant to the introduction of legislation. The process that is relevant to the introduction of legislation and which goes through a rigorous assessment of the regulatory burden to be imposed is not the task force, it is the Office of Best Practice Regulation and it is the regulation impact statement which is before you.
The agency under this legislation is stated to be able to review a relevant employer's compliance with this act by seeking further information from the employer. The wording used is 'may'. It then states that the agency may do this on a random basis. What guidelines are there surrounding the ability of the agency to undertake such a review and in what circumstances would the agency undertake such a review?
The word 'may' in this context I would suggest is probably no different to the way in which statutory discretions are defined across many provisions in legislation state and federal. It is a discretion that gives a statutory agency particular powers. They have a discretion in that. Obviously it would be a matter for the agency as to how they may choose to explicate in more detail how they would want to approach the exercise of those powers. That is not spelt out in legislation, and that is not an unusual thing. There are a lot of statutory discretions in the form that you have described.
Certainly there are a lot of such discretions but, given that there was a three-year lead-up in relation to this legislation, one may have thought that the agency had been provided with some form of guidelines in relation to the exercise of this power, in particular given that checks on a relevant employer may be undertaken and may by written notice require a relevant employer to provide information that is relevant to the employer's compliance with the act. Again I ask the minister: in relation to the checks on the employers, what are the relevant guidelines under which these checks may be taken?
One of the powers that is given to the agency is that it is able to undertake checks of employers to ensure that they are complying with the act. This is an issue that we raised earlier on this year.
It is in relation to the agency reviewing the relevant employer's compliance with the act by seeking further information from the employer and the agency being able to do that on a random basis. I am looking at page 15 of the bill. One of the comments the minister made—in fact, I believe it was former minister Ellis—was that the agency would be able to conduct random checks of employers. A number of employers have raised concerns in relation to the ability to undertake random checks, and I would like some guidelines in terms of what are the random checks and how they are going to be undertaken.
I would have thought the very nature of random reviews of an employer's compliance, which I think is what the senator means when she says checks, indicates that as a compliance mechanism they would be obviated if I was to say to you precisely which employers would be the subject of a random check.
Has the minister or the government considered the implications of union bosses being provided with the information that is required under the act and is it the government's intention that these new measures be used by union bosses to make ambit wage claims or to draw out enterprise negotiations?
Has the government in drafting this legislation turned its mind to the implications of union bosses being provided with this information and the use to which the information may well be put?
We are not quite sure, other than the general anti-union tirade that usually comes out of the contributions of those on that side, precisely what the senator is referring to. If she is referring to the fact that there is potentially confidential information included, I am advised that there are confidentiality provisions contained in the legislation.
One of the aspects that the Australian Greens are concerned about is that the bill excludes those businesses with fewer than 100 employees. Indeed, Senator Rhiannon, in her speech on the second reading, said that the Greens see this as quite detrimental. Has the government given any consideration to extending the coverage of the act to businesses with fewer than 100 employees?
I am looking forward to an amendment being moved at some point. At some point we will get to an amendment, I suppose.
Senator Cash interjecting—
That is a very mature attitude! I will just put on record what the opposition spokeswoman for women said: 'At the rate you're going, I might as well call some divisions just for a bit of fun.' Just for a bit of fun, because, you know, we want to have a bit of fun on this piece of legislation!
Senator McEwen interjecting—
Yes. That the spokesperson for women thinks that this is a bit of fun says something about the attitude on that side. It was probably a bit of a mistake to say that, Senator Cash. I am advised that the act in fact covers employers who have fewer than 100 employees. However, it is the reporting requirement which is relevant to the threshold.
Has the government undertaken modelling on the increased regulatory burden of extending the coverage of the act to businesses with fewer than 100 employees and, if so, what was the result of that modelling?
One of the issues in the regulatory impact statement at page 19 is in relation to the range of regulatory approaches that could be taken by a government. The first one is 'Reducing regulation—no regulation or self-regulation'. It states:
This approach is not recommended.
It then refers to 'Light and responsive regulation'. It says this is 'the preferred option'. It then refers to 'Prescriptive legislation' and states:
This approach is not the preferred approach at this time.
Has the government given any consideration to going down the path of prescriptive regulation in relation to reporting requirements at any time?
by leave—I move opposition amendments (1), (2), (4) to (6), (8) and (9) on sheet 7263:
(1) Schedule 1, Part 1, item 46, page 12 (line 8), omit "13C and".
(2) Schedule 1, Part 1, item 46, page 12 (lines 8 and 9), omit "sections" (wherever occurring), substitute "section".
(4) Schedule 1, Part 1, item 46, page 12 (line 31), omit the note to subsection 14(2).
(5) Schedule 1, Part 1, item 48, page 13 (line 21), omit "13C,".
(6) Schedule 1, Part 1, item 55, page 15 (lines 24 and 25), omit "gender equality indicators, ".
(8) Schedule 1, Part 1, item 55, page 19 (after line 32), after section 19E, insert:
19F Agency to make publicly available the names of employers who submit compliant reports
The Agency shall make publicly available the names of relevant employers who regularly submit reports which comply with this Act.
(9) Schedule 1, Part 1, item 71, page 21 (after line 23), after section 33A, insert:
33B Minister to repeal a legislative instrument when a new instrument is made
If making a legislative instrument under this Act which imposes a requirement on employers, the Minister must cause an existing legislative instrument which imposes a requirement on employers to be repealed.
The opposition also opposes schedule 1 in the following terms:
(7) Schedule 1, Part 1, item 55, page 16 (lines 15 to 29), section 19 TO BE OPPOSED.
The coalition moves these amendments because an analysis of the impact of the current legislation suggests that, despite its stated intent, the bill in its current form will trigger a number of unintended consequences, will result in the implementation of bad public policy and will not achieve the desired policy outcome.
One of the coalition amendments seeks to remove the inordinate level of discretion proposed to be provided to the minister. The bill is drafted to provide the minister with an inordinate amount of discretion. The explanatory memorandum confirms this broad discretion. It states that the bill:
… gives the Minister the flexibility to consider all issues relevant to gender equality and to add new matters.
The coalition believes that the parliament should be given the opportunity to consider the scope and extent of these new matters. The minister to date has been unable to provide any guidance as to what these new matters may be. Perhaps, Minister, you may be able to enlighten us as to whether or not there has been any consideration of what these new matters may well be. In particular, the regulatory impact statement at page 21 talks about 'prescriptive regulation' and says that this 'is not the preferred approach at this time'. Certainly I have asked the minister the question that needs to be answered. To date, it has not been, and I still have concerns about if and when this will be the preferred option of the government, given that in the government's own regulatory impact statement the only guidance that is given is:
This approach is not the preferred approach at this time.
In the absence of agreeing with the coalition's amendments, I would have appreciated the minister giving an undertaking that this is not the intended option and will never be the intended option of the government. Given that the bill provides a mere framework agreement and the government has failed to address so many of the issues that are conveniently left to ministerial discretion, it is the coalition's position that the government is premature in introducing this legislation.
The coalition amendments also seek to reintroduce provisions allowing the agency to waive public reporting requirements for relevant employers and insert a provision for the agency to give public acknowledgement to relevant employers who regularly meet compliance standards. The bill as drafted is all stick and no carrot, with the capacity for the agency to waive reporting requirements for a relevant employer to be repealed. As the Ai Group said in their submission to the initial KPMG review:
… it may be worthwhile, in Ai Group’s view, to introduce a form of positive recognition for organisations which submit regular reports, to provide an incentive to do so. This may be more appropriate and effective than the alternative, which is to penalise those which do not report. While EOWA recognises outstanding organisations through its "employer of choice awards", there are of course numerous organisations which regularly report but for a variety of reasons do not apply for or receive such awards. Recognising organisations which regularly submit compliant report, such as a certification process, could be considered.
The coalition amendments also require the government to remove one regulation for relevant employers for each new regulation imposed by the act. To date, whilst the government is very strong on its rhetoric in relation to repealing regulations, my understanding is that over 18,000 regulations have been introduced by the Labor government during its time in office whilst but a handful of regulations have actually been repealed. So, despite its rhetoric, the government is certainly failing miserably in this regard.
Unlike the government, the coalition supports the right and responsibility of employers to operate efficiently and employ people on merit. We also believe in smaller government and not interfering with businesses getting on with the job of employing people. The coalition believes that the imposition by government of unnecessary and burdensome regulation on business causes business, big and small, to divert time, money, efforts and resources to comply with government red tape. Under this government, that is a considerable amount of red tape, with over 18,000 regulations having been introduced whilst this government has been in power, as I said, rather than creating jobs and opportunities for all Australians. We support the right of employers to run their business efficiently and to employ people on merit. We do not support the placement of measures which are designed to increase the level of government interference in the workplace.
As I stated in my speech in the second reading debate, the coalition is concerned that this particular bill will not achieve its stated objectives and will, rather, as stated by the Chamber of Commerce and Industry of Western Australia, only serve to divert the attention of employers away from efforts to implement measures to promote workplace equality, to ensure they are compliant with the procedural requirements of the legislation.
Whilst the department estimates that the cost to business will decrease on average, from approximately $1,200 to $450 per annum in resourcing costs, page 24 of the regulatory impact statement specifically states:
The reforms will result in increased compliance costs for businesses who have not previously been compelled to report.
Page 26 of the RIS states:
Agency will be provided with the authority to conduct organisational reviews.
It goes on to say:
The time burden—
on businesses that are selected for such a review—
would be increased—
as would the cost burden, being $1,300. It is interesting to note that this estimate was modelled on organisations that have kept appropriate records up to date and accessible. It was certainly not modelled on organisations that have not done this, and therefore the logical conclusion is that the compliance burden on those organisations is certainly going to be a lot heavier.
The compliance burden on Australian businesses is increasing and impacting on productivity and competitiveness. Studies of red tape in Australia have put the cost of red tape as high as four per cent of all business costs. The Productivity Commission has estimated the rewards for red tape reduction alone to be worth $12 billion in additional GDP. Regulation, whether for economic, social or administrative reasons, can increase the cost of doing business, inhibit innovation and erect barriers to entry. The volume of regulation, as I have already stated, continues to grow under the Labor government. I note we have the relevant minister here, the minister for, allegedly, deregulation. I would like to know what the minister's definition of 'deregulation' is, given that over 18,000 new regulations have been introduced under this government, whilst I understand that fewer than 100 have actually been repealed.
Many important laws and regulations have been introduced without proper assessment of the costs and benefits, including a lack of consultation with affected stakeholders. The coalition understands the impact that red tape and excessive regulation can have on business. We work on this principle, unlike the government: a business that has to close employs no-one. In our opinion, that does not assist gender equality in the workplace. The coalition's commitment to reducing red tape is a real commitment—hence the announcement of our deregulation task force. The aim is to reduce regulation and red tape by over $1 billion per annum. Regulations that raise business costs and reduce competition are a particular focus of the coalition's review.
Unfortunately, Labor does not understand this and this bill is just another example of its lack of understanding. In proposing our amendments, the coalition is seeking to strongly support the principle of gender equality. The amendments are drafted to make meaningful changes to the current bill in the interests of achieving gender equality, improving workplace participation and improving workplace flexibility. The reform of the act represented the chance for the government to do something meaningful to advance gender equality in Australian workplaces by introducing measures to improve flexibility, productivity and incentives to encourage women back to the workforce after having children. Regrettably, what we are faced with tonight, and what will pass the Senate tonight, is nothing more and nothing less than hastily concocted, half-finished measures that are unclear and provide for an inordinate amount of ministerial discretion. They certainly provide for an inordinate amount of ministerial discretion, in particular when the minister is able to make decisions that will directly impact on the regulatory burden on businesses. That is not something that is supported by the coalition. The bill in its present form represents a failure of Labor government policy and a lost opportunity to improve gender equality, which will continue to be a significant disincentive to the participation of women in the Australian workforce.
Senator Cash has put no coherent argument about why coalition amendments should be supported and this legislation should be voted down. We have heard a few anti-union outbursts and off-the-mark questions, and Senator Cash's red tape complaints just do not stand up. The legislation before us puts minimal requirements on business.
The Greens do not support any of these amendments. The package of changes knocks out the advances for women in this bill. The amendments, if passed, would return us to the status quo, which is quite extraordinary. Having said that, the amendments are useful in that they provide a window into the coalition's policy for women and what a setback it would be for women if we ended up with an Abbott-led government. What Senator Cash has put on record tonight is that the coalition will not play a role to end discrimination and remove the disadvantage so many women still face. There is a lot of heavy lifting to be done to remove all the discrimination. Tonight provides a very small step, a small bit of lifting, and the coalition could not even come on board for that.
I thought I should respond to Senator Cash's amendments. First, in relation to some of the comments about deregulation: a number of the senator's assertions are quite incorrect. I do not wish to take up the Senate's time by going through them. I would make the point that she might want to look at a report—I think it came out today—which talked about the time taken in compliance for small business; the largest single component was in fact the GST which, of course, was introduced by the coalition.
I think her figure of $4 billion, in terms of the Productivity Commission's assessment of the benefits of deregulation, the cost reduction, is actually referring to a Labor agenda. It is actually referring to the various components of the seamless national economy reforms which COAG signed off on in 2008 and which Minister Bradbury and I and other ministers are working on. And it was those deregulation and harmonisation initiatives—introduced by a Labor government, and being worked through in painstaking fashion, because that is, unfortunately, what is required, with state governments of both political persuasions—which were assessed by the Productivity Commission as giving rise to the reduction in business costs of $4 billion.
I think the senator did introduce all of her amendments, so I will just give her and the chamber the courtesy of indicating briefly the government's response. The government does not support these amendments.
On amendments (1) to (5): these amendments seek to reinstate the waiving provision and remove the personal information provision. The government does not support the reinstatement of the provision enabling the agency to waive public reporting requirements. In the consultations carried out for the review, waiver was not well supported across business or the community more broadly. It is administratively burdensome for both the agency and business.
To streamline the administrative burden the government has the new online simplified reporting system to which I referred earlier, which makes reporting once a year consistent across all employers. If select organisations were to be waived from reporting annually, the integrity of the data would be undermined. Really we are looking at, I suppose, an annual health check on gender equality, and I think it is not an unreasonable proposition.
We are not sure why the coalition would be doing so, but one of the amendments, I am advised, involves the removal of provisions relating to personal information. The government considers that this provision is important to ensure the privacy of individual employees and is consistent with the provisions of the Privacy Act, and so does not support the amendment.
On amendments (6) to (7): these amendments seek to remove the capacity for the minister to set minimum standards in relation to gender equality indicators. What the amendment proposes to do is to remove all reference to how minimum standards are set. One wonders how that is in fact pro-business and how that would be transparent. Without this provision, it would seem rather strange to consider how a minimum standard would in fact be set. The minister, under the government's approach, is required to consult with appropriate organisations and persons, and in considering the consultation the minister will consider the nature of the instrument. So the amendment, I am advised, makes neither legal nor practical sense. In the consultation process, business asked for the assurance of a disallowable instrument, and this is what section 19 provides.
As to amendment (8): this amendment seeks to make public the names of relevant employers who regularly submit reports which comply with the act. We believe this amendment is unnecessary. Section 15A is already being amended by this bill to explicitly enable the agency to publish reports by electronic or other means. Recognition of good gender equality practice is a key part of the agency's functions, and this will continue.
Amendment (9) seeks to have the minister repeal an existing legislative instrument imposing a requirement on employers when a new instrument imposing a requirement is made. The government does not support this amendment. The legislative instrument referred to in the bill would not contain requirements. The requirement to report is contained in section 13, in relation to gender equality indicators not in the legislative instrument. The specification of minimum standards in relation to gender equality indicators, I am advised, is not a requirement. Similarly, the minister cannot cause a legislative instrument to be repealed. A legislative instrument is required in order to revoke an existing instrument. As for all disallowable instruments, it is tabled in the parliament and subject to disallowance. The government believes this ensures an appropriate level of scrutiny.
Due to the lateness of the hour, I will not be calling a division. However, I note that the government and the Greens did not support the coalition's amendments.
The TEMPORARY CHAIRMAN: The question now is that section 13C in schedule 1, part 1, item 46, which was circulated as amendment (3), stand as printed.
Question agreed to.
The TEMPORARY CHAIRMAN: The question now is that section 19 in schedule 1, part 1, item 55, which was circulated as amendment (7), stand as printed.
Question agreed to.
Bill agreed to.
Bill reported without amendments; report adopted.