Josh Frydenberg (Kooyong, Liberal Party, Minister for the Environment and Energy) Share this | Hansard source

I move:

That this bill be now read a second time.

Further to this parliament's recent passage of a bill to establish the independent parliamentary expenses authority (IPEA), I am pleased to introduce the Parliamentary Business Resources Bill 2017.

This bill is the next step in the biggest reforms to the management of parliamentarians' expenses in more than a generation. It is the new foundation on which we will build the instruments that prescribe all future parliamentary work expenses.

This bill will see the implementation of a number of key recommendations of the review chaired by John Conde and David Tune into the parliamentary entitlements system, by streamlining the legislative and administrative framework for parliamentarians' work expenses into one single head of legislative authority—this was one of this review's key recommendations.

A number of other recommendations of this review will also be progressed through this bill, including:

Through the introduction of an independent authority which can make rulings, a clear definition of 'parliamentary business' along with increased transparency, the government is moving to restore public confidence in parliamentarians' expenditure.

As this government has previously said, the current parliamentary expenses framework is complex and challenging both for parliamentarians and the public to navigate and understand. It comprises multiple pieces of legislation, regulations, determinations, procedural rules, guidelines, conventions and decisions of executive government.

It is time for a simpler, more transparent framework that governs our use of public resources to conduct our parliamentary business.

There are many benefits in establishing a simpler parliamentary work expenses framework. A simpler, clearly defined framework will not only better guide and support parliamentarians in making confident, responsible decisions, but it will enable increased public awareness of the expenses and allowances that can be claimed.

This, in addition to the monitoring, auditing and reporting functions of the soon to be established IPEA—including the more regular disclosure of parliamentarians' expenses—will facilitate a greater degree of transparency, accountability and integrity in our use of taxpayers' money.

A simpler framework will also reduce the administrative load on parliamentarians and their employees, allowing us to spend more time doing what we are elected to do—serving our constituents and community.

New rules and obligations will be placed on parliamentarians to ensure that we spend taxpayers' money carefully and only for purposes that relate to the duties we undertake as their parliamentary representatives.

Under a new dominant purpose test, parliamentarians will be prevented from accessing public resources under the new framework, unless it is for the dominant purpose of conducting parliamentary business. This test will be the standard that we must meet in order to claim work expenses.

In keeping with the recommendations of the review, the bill will specify that parliamentary business means parliamentary duties, electorate duties, party political duties and, for office holders, official duties. The bill will authorise the minister to make a legislative instrument that specifies activities under each of these four duty streams.

The bill will also require us to ensure that our use of public resources achieves value for money—that public resources are used efficiently, effectively and economically. This is consistent with the obligations on Commonwealth public servants for the proper use of taxpayers' money. It is appropriate that it also applies to our use of public resources.

Parliamentarians will be personally accountable and responsible for assessing what represents value for money and must be prepared to justify publicly their use of taxpayers' money.

Parliamentarians that claim expenses for a dominant purpose other than conducting parliamentary business or who breach conditions relating to claimable work expenses will be personally financially liable for the costs associated with the work expenses and subject to additional financial penalties under the penalty loading scheme.

The penalty loading scheme will impose a 25 per cent penalty loading on top of the cost of an expense or allowance that does not comply with the rules and which is not repaid within 28 days from the date the claim was made. The penalty scheme will not apply where there was an administrative error by the Commonwealth. Nor will it apply where a travel expense or allowance was outside the rules but, in incurring or claiming that expense or allowance, the parliamentarian reasonably relied on advice from IPEA.

Further to this, it must be acknowledged that it is imperative that parliamentarians and their staff are able to receive guidance and support to ensure that we access work expenses within the rules and abide by our obligations. This is particularly important in relation to the travel we undertake to fulfil our representative duties.

This bill will provide IPEA with the power to make written rulings relating to travel expenses and allowances. IPEA may provide a ruling on its own initiative or at the request of an individual parliamentarian. Rulings will conclude whether a travel expense or allowance was within the rules, including whether it was for the dominant purpose of conducting parliamentary business or represented value for money.

A ruling is conclusive evidence of the matters it deals with. Where a ruling finds that a parliamentarian has incurred or claimed a travel expense or an allowance beyond the rules, the amount claimed or incurred will be a debt to the Commonwealth and a penalty loading will apply if not repaid within 28 days of the claim.

Importantly, as I have already mentioned, a debt will not exist where a parliamentarian claimed or incurred the travel expense or allowance in reliance on personal advice given by the IPEA. This ensures that parliamentarians can receive personal advice which provides them with certainty of what travel expenses and allowances they are able to claim. The Department of Finance will continue to provide advice on work expenses other than travel, but such advice or expenses will not be the subject of a ruling by the IPEA.

As the Prime Minister has previously identified, as parliamentarians we have a duty to ensure that our use of public resources meets the expectations of all Australians. Following the establishment of the IPEA, this bill is the next step in a robust response to the obvious shortcomings of the existing system. The bill will provide greater clarity to parliamentarians in their use of taxpayers' money while further increasing transparency and accountability on such expenditure.

My hope is that this bill will also go some way to restoring the public's confidence in the parliamentary expenses framework, which has arguably degraded the public's view of parliamentarians over recent decades.

I look forward to working with the opposition and other members and senators to ensure that this very important next step to timely reforms to parliamentary work expenses is delivered as soon as possible.

Debate adjourned.

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