Graham Perrett (Moreton, Australian Labor Party) Share this | Hansard source

Yes, often not that; that is right. The government’s financial framework is governed by the Financial Management and Accountability Act 1997 and the Commonwealth Authorities and Companies Act 1997. The Financial Management and Accountability Act exists to provide for the proper use and management of public funds, public property and other Commonwealth resources—the funds, property and resources that belong to the good people of Australia. The act ensures accountability and transparency in the management of public money, and obviously all Australian taxpayers would expect nothing less. Hopefully, the members opposite—as they cling to the last remaining shreds of economic responsibility—would want the Australian taxpayers’ money to be managed properly and will be able to support this legislation a lot more readily than the member for Dickson. The absence of speakers from the opposite side perhaps suggests that silence is assent.

This bill amends the Financial Management and Accountability Act to further simplify the system. This bill will amend the act to reduce red tape in the administration of 19 departments and 100 agencies under the act. It will also update and clarify governance and reporting provisions, ensuring even greater efficiency and accountability. Taxpayers expect all governments to manage public dollars with the highest levels of integrity and accountability. They also expect us to be smart about the way that we invest and position Australia in the global economy. In the global economic market, like in the Olympics, we are a small country, but we do fight above our weight.

Australia is leading the world when it comes to fund management. This government will continue to drive initiatives that strengthen Australia’s position as a financial services hub, particularly in Asia. Through my background as a lawyer and in the union sector, I have seen employers and employees coming together with their industry funds, which seem to outperform so many other funds. Anything that this government can do to boost that is to be commended. The finance and insurance sector contributes more than seven per cent of GDP, employs around 400,000 and contributes about $30 billion in tax revenue. The policy of compulsory superannuation saving, introduced by the Hawke and Keating governments, has helped build offshore managed fund assets worth $1.4 trillion. That is the sort of economic reform that I was talking about—rather than just fiddling with the balance sheets, as the member for Dickson referred to.

This has helped develop Australia’s reputation as a well-respected, experienced and appropriately regulated financial hub—something that the rest of Asia looks to in amazement on occasion. We are a world leader, but we can do better. Despite being a world leader, only a small amount of foreign funds are under management here, with less than three per cent of fees derived from foreign investment. This was an opportunity missed over the last decade. With less than three per cent of fees derived from foreign investment, we needed to turn our gaze, more than a decade ago, to Asia to try to attract some of their funds and promote our experience and our credentials as a manager of funds. This government is reducing the withholding tax rate to encourage greater foreign investment in managed funds. Under new measures to be implemented, foreign investors will eventually be subject to a minimum 7.5 per cent withholding tax rate. This will make Australia more competitive, particularly in our region, and boost exports in the financial sector by more than $3 billion.

Much of this bill corrects typographical errors—and I know you are stickler for typographical errors, Deputy Speaker Sidebottom—or clarifies existing provisions. While I welcome the corrections, I do not intend to dwell on them today. However, I will address some of the more significant amendments contained in this bill. This bill gives public servants, particularly chief executives, a clearer understanding of what is required of them and their reporting obligations regarding government resources—that is, the resources that belong to the good people of Australia. The bill clarifies that chief executives must use Commonwealth resources in synergy with Commonwealth government policy.

Chief executives already understand the efficient, effective and ethical use of public resources. This amendment bill builds on this understanding to make it clear that approval of expenditure must also be in keeping with the relevant Commonwealth policy. Any fair-minded person would expect that public funds should be spent in a way that is consistent with government policy. This amendment effectively enshrines in law the modus operandi that is already in place in the Australian Public Service. The Rudd government have a very high regard for the Public Service, and that is why we want to ensure that their obligations and expectations are always clearly defined.

The Public Service has a long tradition of independence and effective implementation of government priorities, irrespective of the government. It is important that the independence of the Public Service is upheld. It was reassuring to see after the election in November last year that there were no job losses—or no ‘night of the long knives’—as occurred when the Howard-Costello show hit Canberra back in March 1996. Instead, we had faith in the public servants here in Canberra. I stress that these amendments before the House do not in any way undermine the independence of statutory officeholders, like that of the Auditor-General and the Ombudsman.

This bill will also deregulate the ability for contractors to handle public money when authorised by an act or by the finance minister. Contractors can already make payments of public money, but it is a very complicated legal process. It either involves complex legalese or actually occurs in contravention of the law. This amendment will sort out those anomalies. Obviously, we do not want to take anything away from the good work of lawyers, but this will simplify things. Under this amendment, any agreement will still need to be authorised by the parliament or the Minister for Finance and Deregulation, the Hon. Lindsay Tanner, but it will ensure that contractors can legally make payments, rather than only being able to receive and hold money on behalf of the Commonwealth.

This bill will also remove two archaic bodies corporate from provisions dealing with Commonwealth investments and streamline rules for how agencies rely on appropriations. Further, this bill amends the Albury-Wodonga Development Act to bring the Albury-Wodonga Development Corporation under the Commonwealth Authorities and Companies Act. As a Commonwealth authority, it is more appropriate that the Albury-Wodonga Development Corporation come under the CAC Act rather than outside a recognised framework. I thank the Minister for Finance and Deregulation for introducing this bill and, in doing so, I commend the bill to the House.

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