Matt Keogh (Burt, Australian Labor Party) Share this | Hansard source

The banking royal commission has unveiled myriad banking and financial sector scandals that will change the face of banking in Australia forever. It was financial whistleblowers who exposed the corrupt practices at banks and financial institutions, including insurers, that led to the realisation of the need for a royal commission in the first place—a royal commission that this government declared was a 'populist whinge' for more than 600 days, a royal commission that this Prime Minister voted against 26 times. No wonder then that to date whistleblowers have been hesitant to come forward and dob in misconduct. It was only in February when the industrial relations minister named Labor's plan to reward whistleblowers as 'wacky'. No wonder whistleblowers are wary of retribution—the Minister for Jobs and Industrial Relations won't even give them the time of day.

The Treasury Laws Amendment (Enhancing Whistleblower Protections) Bill 2018 implements to some degree some of the recommendations of the September 2017 report of the Parliamentary Joint Committee on Corporations and Financial Services into whistleblower protections, which I took part in. It's quite a tome. The report we formed outlines protections for the public and not-for-profit sectors. This report was intended to better protect whistleblowers. In the bill before us today the Liberal government has only addressed a fraction of the committee's recommendations, and it hasn't responded to the committee's report itself. It is disappointing, yet not at all surprising, that this Liberal government yet again had to be dragged kicking and screaming to strengthen this bill. Their protection racket for big business must stop.

The current whistleblower protection regimes concerning corporate and financial services whistleblowers, are currently found scattered across the Corporations Act, the Banking Act, the Insurance Act, the Life Insurance Act, and the Superannuation Industry (Supervision) Act. These regimes are inconsistent with each other. On top of that, there are currently no whistleblower protections under the National Consumer Credit Protection Act or the Financial Sector (Collection of Data) Act. The new protection regime in this bill will cover the disclosures in those aforementioned acts.

Under this new form of protection, disclosures must be made in a particular way—that is, they are to be reported to eligible recipients, such as supervisors, auditors, ASIC or APRA. This bill significantly broadens the conduct about which disclosures can be made, with the regime covering misconduct or an improper state of affairs or circumstances in relation to an entity or body corporate, as well as conduct that is a danger to the public or financial system and any breaches of Commonwealth law and breaches of any specified acts connected to the financial services industry in particular. This bill also allows for anonymous disclosures, which is much better than the current legislative regime, which requires individuals to divulge their identities, effectively deterring many.

This legislation removes the requirement that a whistleblower make a disclosure in good faith, as this requirement has also been found to create uncertainty and a risk for whistleblowers. Instead, these protections and remedies are based on the objective reasonableness of the whistleblower's grounds to suspect the misconduct or other disclosable matters.

The legislation also expressly allows for disclosures to lawyers for the purpose of obtaining legal advice and strengthens restrictions on revealing a whistleblower's identify. In addition, the legislation addresses key differences across the pre-existing regimes. It provides for emergency disclosure to a Commonwealth, state or territory parliamentarian, or a professional journalist, where the whistleblower has made a disclosure to the appropriate regulator and, after a reasonable time has passed, reasonably believes there is a threat to public safety or the stability of the financial system. Further, it provides for broad remedies for whistleblowers, including an extension of compensation for victimising conduct or, in appropriate circumstances, exemplary damages.

Critically important is the new requirement for public companies, large proprietary companies and registrable superannuation entities to have whistleblower policies in place. This has been a huge gap in our existing system. The lack of any policies in many large businesses has meant it has been unclear for people working within them to know where to go. Disclosures made to other agencies are not covered by protections under this bill and will be permitted only should there be no action by eligible recipients in an appropriate amount of time and public safety or the stability of the financial system are at risk.

This legislation, though, has been criticised, rightly, by a variety of experts, including the government's own whistleblower expert panellist, Professor AJ Brown, who called this bill 'more a sideways than a forward step on key issues'. Labor, on the other hand, has a strong record when it comes to whistleblower protections. In government, Labor introduced the landmark Public Interest Disclosure Bill 2013 for public sector whistleblowers. Labor have also committed to introducing tax whistleblower protections, and we will continue to push for a stronger and more comprehensive scheme of whistleblower protections in the private sector than is before us today in this bill. We on the Labor side want to ensure that whistleblowers come forward, and aren't afraid to do so, because we know how important it is for the culture of cover-up to be conquered once and for all.

This commitment is driven, as I said before, by the landmark consensus recommendations of the Parliamentary Joint Committee on Corporations and Financial Services through its inquiry into whistleblower protections. That was a consensus report driven by not only members of the government and members of the opposition but members of the Greens and those from Centre Alliance. The committee worked well in arriving at the report's consensus recommendations—things that we believe the government could, and should, have implemented through this legislation. Unfortunately, the recommendations in that report have been largely ignored.

A Shorten Labor government will implement a whistleblower reward scheme to enable whistleblowers to receive, from conduct they expose, a percentage of the penalty that is awarded by the court. The reward would be funded through the penalties collected by government and the amount would be determined by the relevant investigative and law-enforcement agencies. A Labor government will also implement an Australian whistleblowing act, which will strengthen, expand and consolidate public and private sector whistleblowing regimes under a single set of laws. Not only does this make the law clearer; it makes it easier for members of the public to understand what their rights and protections are under Commonwealth whistleblower protection law. In addition, a whistleblower protection authority will be established to ensure individuals can easily access information and assistance on their rights and the disclosure process.

Effective whistleblowing provides an essential service in fostering integrity and accountability whilst also deterring and exposing misconduct, fraud and corruption. A recent analysis of whistleblower protections across G20 countries found Australia's laws lacking across the private sector. Whistleblower protections remain largely hypothetical, with little real-world effect in either the public or private sectors. Unfortunately, under the legislation that is before us, there are minimal protections for those who expose serious misconduct and who are likely to be subject to reprisals. That is why we propose a whistleblower protection authority, which would be a body with a demonstrated track record in identifying and investigating corruption and bringing those responsible to account. Labor will establish a protection authority, overhaul current laws into one act and fund prosecutors to make sure those involved in criminal wrongdoing are brought to justice.

While Labor support this bill, the bill also makes clear that this government has no real commitment to whistleblower protections or to ensuring that there is an appropriate clamp-down on corporate misconduct in this country. It is but another fig leaf of this government for its inaction when it comes to corporate wrongdoing. It avoided holding a royal commission, it defunded ASIC and it refused to give additional funding to the Commonwealth DPP. It has not gone the whole hog when it comes the whistleblower protections.

The government has continually refused to do what is necessary to protect Australians from corporate misconduct. It continues to throw up piecemeal pieces of legislation. As I've said time and time again in this House, we called for the introduction of a banking executive accounting ability regime, and then they gave us one—except it was one that didn't actually protect consumers. Now, the royal commission has finally found that that's required, and the government tells us that it agrees to it. Again, there is no legislation forthcoming from this government.

These are all things the government could and should have been doing a long time ago. The report recommendations here are from September 2017. The legislation that we're debating today was held up in the Senate for so long by this government last year and we're only now debating them, which not only has caused us not to have proper whistleblowing protections in our law at a Commonwealth level but has also meant that businesses that have to comply with this law haven't known what they have had to comply with. They have had to look at moving start dates to make sure that they can have their policies properly drafted to comply with this law, which is a new requirement of this law, once it does eventually become law. This government doesn't make things easy for the Australian people, but it could at least get on with ensuring that they are protected from misconduct.

We support this legislation. It is absolutely necessary and vital that we have better whistleblowing protections in this country. Once again, the government has failed to do everything that is required. It has failed to deliver on proper, expansive whistleblower protections that will not only protect whistleblowers but encourage people to blow the whistle where misconduct is found. Because it is only through that conduct, over many years, that we eventually saw the exposure of the banks and the exposure of the misconduct by insurance companies that finally, eventually, led to a royal commission, which was the royal commission that this government refused to hold for over 600 days.

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