Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

With your indulgence, Mr Deputy Speaker, I begin by commending the member for Riverina on the comments she has just made. It is an issue, I think, that is extremely important. I have a motion on the Notice Paper with exactly the same intent, and I appreciate her contribution on the issue. I hope, like her, that the COAG meeting will lead to some serious progress. It is a national scandal that we have large numbers of young people, who are severely disabled or have acquired brain injuries and things of that kind, in nursing homes. I commend the member for Riverina for her efforts in that regard.

The Financial Framework Legislation Amendment Bill (No. 2) 2005 is supported by the opposition. It is largely routine legislation, covering a number of unrelated matters which I do not intend to deal with in any great length, but there are a couple of things that I do wish to address.

There are a variety of provisions, including a bit of tidying up with respect to special accounts for particular agencies, and a number of other essentially routine matters, but there are two areas that I want to make some observation on. One relates to the extension of certain exemptions that currently apply with respect to Financial Management Act provisions, regarding intelligence or security agencies to policing agencies, and the other relates to reforms to Comcare.

Schedule 3 of the bill includes an amendment to section 58 of the Financial Management Act, which provides that intelligence or security agencies may avoid some of the requirements of the Financial Management Act via the regulations. These exempt agencies from approval of spending proposals affecting operational money allow the banking of public money—that is, operational money in an account that is not an official account—and provide for the preparation of financial statements other than in accordance with the finance minister’s orders.

The amendments sought would allow Financial Management Act agencies that are law enforcement agencies, as defined in section 85ZL of the Crimes Act, and including the Australian Federal Police, the Australian Crime Commission, CrimTrac, the Australian Customs Service and so forth, the potential to avoid some of the requirements of the Financial Management Act via the regulations.

There are several good reasons for the extension of these exemptions concerning officers working undercover with an assumed identity, witnesses who are under protection, and controlled operations. However, Labor would like to raise the concern that these changes will take place without the benefit of the Australian Commission for Law Enforcement Integrity, promised prior to the last election but which has still not been delivered. Labor will deal with these matters further in the Senate.

Finally, I would like to deal with the changes to Comcare and the administration of Comcare as proposed in the bill. In effect, the bill deals with a longstanding problem with respect to Comcare, where weekly payments for workers who are off work as a result of injuries cannot be made by their employer, the agency involved, until such time as there is actually a finding of liability on the part of Comcare. That of course creates the strange circular arrangement where either the individual concerned goes unpaid for a period of time or they use existing leave entitlements which are then subsequently reimbursed.

It is part of a broader problem in Comcare where there is a triangular situation: the individual claimant is at one point of the triangle; their direct employer, the agency, is at another point; and Comcare is at another point. One of the things that happens in practice all too often is that individual claimants end up in situations where they have Comcare and their individual agency both pointing at each other as the organisation that should sort out the problem. There is a structural weakness in Comcare that needs to be corrected and this legislation at least takes a significant step in that direction, so I commend the government for acting on this.

This raises the broader question of something that is very dear to my heart and has been for a very long time, and that is how we deal with problems of injured workers and people with serious injuries and disabilities in this country generally. We are still in the Dark Ages in spite of the efforts of the Whitlam government in 1975 to introduce a uniform national compensation scheme, which unfortunately was defeated in the Senate. We are still in the Dark Ages, with a hodgepodge of bits and pieces schemes and arrangements all around Australia providing a wide variety of different degrees of compensation and assistance for people suffering serious injuries and illnesses which prevent them from working, impose a whole range of economic burdens on them and, of course, impose major burdens on their ability to live normal lives. That imposes a great difficulty on many Australians, who are essentially invisible, because we do not hear about these people in the community.

So, although there are some who are reasonably well compensated out of existing injury compensation schemes, particularly if they are in a jurisdiction where common law still exists and they have the ability to sue because they can demonstrate negligence against another party, typically an employer, there are many others who miss out and suffer essentially the destruction of their lives or their wellbeing as a result of a serious illness or injury because they are unable to connect their situation with some particular party that has a liability to compensate them.

I came across an example of this only recently. A woman in my electorate who contracted hepatitis C as a result of a blood transfusion at a major hospital in Melbourne has received legal advice that she is unable to sue the hospital and that the prospects of success in any case would be very slim. She has now got to the point where she is largely unable to work and has gone on to the disability support pension. Her long-term prospects look decidedly grim. She will hopefully be able to manage the illness, but her ability to remain a productive member of the workforce into the future looks very clouded. As a result of this, she goes on to the very basic, very limited, income of the disability support pension; whereas, had she been able to demonstrate negligence on the part of the hospital, she would have been in a position to achieve a very substantial common law payout. It has nothing to do with her need but everything to do with a highly arbitrary and ultimately very artificial equation about demonstrating negligence on the part of, in this case, a service provider.

This is an irrational way of providing compensation for people suffering serious illnesses and injuries. It is based not on their need but on the circumstances in which they acquired those illnesses and injuries. Because of almost universal insurance arrangements, the notion that somehow negligence law and common law provide some kind of deterrent to people negligently injuring others I think is highly dubious. There are some instances where you can probably make some argument to that effect, but in overall terms the notion that the operation of common law actually does that is basically pretty hard to demonstrate. There is a bigger picture question that we as a society have to look at, and that is how we provide income support for people with serious injuries and illnesses and how we provide maximum opportunity for them to recover, rehabilitate and return to the workforce, if not in their previous occupation then at least in some form.

We are long overdue in this country for a major reform agenda for the way we deal with workplace and other injuries, the way we assist injured workers and other injured people to deal with their problems and the way we provide for compensation. I commend the government on this small step in this legislation of a small reform of the Comcare arrangements. I hope this will improve the efficiency of the way Comcare is administered, provide some relief for injured workers who operate under the Comcare scheme and provide some reduction in the extent to which bureaucracy creates barriers to them achieving their entitlements and being able to get some relief and some justice.

In conclusion, this nation as a whole—that is, all the states and territories and the Commonwealth—is long overdue for a major reform agenda. It probably need not be the same as what Labor proposed 30 years ago. The world has moved on. There are many different issues that we need to deal with. Some of the things in that proposal are probably not appropriate now. We in this country are long overdue for a very serious examination of how we can build a world-class, 21st century system of compensation, support and rehabilitation for people with serious injuries and illnesses. The ramshackle, bits and pieces, often highly unjust and highly inefficient regime that operates currently in this country simply is not good enough. Although a wide array of interests—some associated with the conservative side of politics and some associated with my side of politics—resist reform, ultimately the people we have to be concerned about are the very large number of Australians who suffer serious illnesses and injuries, which in many cases cripple their lives, and who we are not adequately assisting as yet. I see this legislation as one small but significant step towards improving the existing system in a particular jurisdiction. That is helpful, but we have a big task in front of us and we as a nation are long overdue to do something serious about it.

Kelvin Thomson (Wills, Australian Labor Party, Shadow Minister for Public Accountability and Human Services) Share this | Link to this | Hansard source

I do not intend to speak at any great length on the Financial Framework Legislation Amendment Bill (No. 2) 2005, but I want to say a couple of things. The first is to support the remarks just made by the member for Melbourne concerning the issues of accident compensation and compensation for injured workers. I think everything the member for Melbourne has said about the unsatisfactory nature of the present system is correct. There is something of a lottery if you are injured. If you can show that someone—whether it is your employer, a council or an education department—is responsible for your injury then you can on occasion receive very large and generous compensation for the injury or the illness. But, on the other hand, if you cannot show that it was somebody else’s fault, and that somebody has deep pockets, you are put in the position of dependence on the disability support pension and in many cases that is inadequate.

I can remember in years gone by that a particularly unsatisfactory feature of the existing regime was that payouts were almost universally by way of lump sums, and frequently people who received these lump sums for very substantial injuries had them managed by others and found that they had become lost, stolen or mismanaged and turned into nothing. I can remember when I was shadow Assistant Treasurer and had some responsibilities in the area of insurance pursuing this issue. There was a case in Geelong where a young man had very serious injuries as a result of negligence by a hospital and had received a payout in the order of $7 million. Unfortunately, his Geelong accountant had taken something like $6 million of that $7 million and got rid of it at the Crown Casino. He was, of course, charged with theft et cetera. But it was a very unsatisfactory example of the way in which the lump sums could disappear or be maladministered. I and others at that time put pressure on the government for a change to the taxation legislation to encourage people to take these settlements by way of periodic payments rather than lump sums. I am pleased that the government, under some duress, acted in that direction and that we now have a situation where it is easier to have your compensation payment made by way of periodic payment rather than lump sum.

One of the interesting postscripts on that Geelong case was that this young man’s injuries were so severe that within about 12 months of my visiting him he passed away. The truth is that, had the theft not occurred, that $7 million would have been an excessive amount of compensation; it would have been a windfall to the family. So there are people on one side of the existing legal arrangements who can get quite generous compensation and people on the other side of the arrangements who lose out in the lottery, receive very little compensation and are put in very serious positions as a result of workplace injuries, transport injuries and other injuries.

There are schedules in this bill which refer to the government’s welfare to work changes. I only wish to speak briefly on these matters. Not having had the opportunity, due to other commitments, to speak in the House on welfare to work issues previously, I want to take this opportunity to express my concern that the government is essentially, with these changes which are soon to come into effect, moving people from one welfare payment to a lower welfare payment. Sole parents in future, when their child turns eight, will be dumped onto the dole. The problem is that you actually lose more of every dollar you earn when you are on the dole than on the current payment. That does not act as an incentive to go out into the workforce and earn more money; that acts as a disincentive. I believe that people with a disability will be even worse off. They are currently on the disability support pension. In future, if they are assessed by someone in the department as being able to work 15 hours a week, they also will be dumped onto the dole and thereby take a significant cut in their income. You have got to ask the question: if the government seriously believed that this was a good idea, why wouldn’t they be doing it to the existing 700,000 disability support pensioners?

I note that one of the Liberal MPs from Western Australia, the member for Pearce, Judi Moylan, has stated that there will be extremely adverse results for single parents and people on disability pensions. I think she is quite correct in her assessment of this. It is a shame that the government has not taken more notice of her. I want to put on the record my concern that this precisely will be the outcome of the government’s proposed changes. I am all in favour of mutual obligation and reciprocal obligations, but I believe that the way in which the government is approaching these welfare to work issues will simply result in reduced payments for people who are in that unfortunate situation.

Schedule 4 of the bill relates to the Job Network. I want to point out to the House that we have had an Auditor-General’s report on the Job Network tabled in parliament in June last year, which found that the levels of contact between Job Network members and jobseekers rarely met contractual obligations; that the assessment of jobseekers’ needs, a contractual obligation, was limited; and that customisation of jobseekers’ Job Search plans was very limited. The Howard government’s failure to ensure contractual obligations are met has had a very bad impact on those who are having the most difficulty finding work. The report gives some indication as to why it is that long-term unemployment has increased by 60 per cent over the past five years. The report found that the department lacks clear objectives and performance indicators relating to service standards, and indeed this seems to explain why complaints about the Job Network to the employment department’s customer service line have doubled in recent times. It is true that the Auditor-General’s report raises serious concerns about the Job Network’s capacity to manage the implementation of the so-called welfare to work package. In other respects I associate myself with the remarks made by the member for Melbourne.

Gary Nairn (Eden-Monaro, Liberal Party, Special Minister of State) Share this | Link to this | Hansard source

In summing up debate on this bill on behalf of the government, could I just make a few short comments. I do not want to keep the Main Committee too long on this, as the opposition have indicated their support for the bill. The passage of the Financial Framework Legislation Amendment Bill (No. 2) 2005 will enhance the financial management framework of the Australian government and lead to clearer and more efficient administrative arrangements and practices.

The greater part of the Financial Framework Legislation Amendment Bill proposes amendments that are of the same type as were made in the act. The act commenced on 22 February 2005. These types of amendments were also supported by the Joint Committee of Public Accounts and Audit in its report No. 395: Inquiry into the Draft Financial Framework Legislation Amendment Bill. The report was a precursor to the introduction of the bill that was passed as the Financial Framework Legislation Amendment Act. The Joint Committee of Public Accounts and Audit has been consulted about the proposed amendments to the public accounts act and has indicated its broad agreement to the amendments. I note that the amendments do not alter the committee’s role, powers and functions as contained in the act.

This bill really only covers housekeeping matters of an administrative nature, and that is presumably one of the reasons that the opposition support this bill. I noted the comments by the member for Melbourne about raising other detailed matters in the Senate. That would probably be the most appropriate place to do that, as the minister responsible for this bill, the Minister for Finance and Administration, is in the Senate.

I was a bit intrigued by the references that the member for Wills made in his statement. I think he was drawing a very long bow with respect to being relevant to the legislation. I gave him latitude, I suppose, in letting him make his comments, but I will just comment on the Job Network matter that he raised. I note that he did not refer to the unemployment rate in criticising Job Network. I do not know what the unemployment rate is in his electorate, but I suspect it has probably dropped dramatically over the last 10 years.

Cameron Thompson (Blair, Liberal Party) Share this | Link to this | Hansard source

It is 2.7 per cent in Ipswich.

Gary Nairn (Eden-Monaro, Liberal Party, Special Minister of State) Share this | Link to this | Hansard source

Like 2.7 per cent in Ipswich, as the member for Blair says. I know that in my electorate of Eden-Monaro it has gone from up near eight per cent in 1996, down to well below five per cent—it is about 2½ per cent in Queanbeyan, for instance—and a lot of that is to do with the Job Network. It is the strong economy, but it is also the Job Network.

When I was elected to parliament in 1996, there was a CES office in Queanbeyan, a CES office in Batemans Bay and a CES office in Bega, and a part-time visiting service to Cooma, where people from Canberra went down on a Wednesday afternoon—and often they did not even make it on a Wednesday afternoon. That was how they serviced Eden-Monaro with respect to unemployment. Now we have Job Network providers not only in those towns but also in Moruya, Narooma, Merimbula, Pambula, Eden, Jindabyne—it just goes on—and that has had a great impact. That is not directly relevant to this legislation, but given that the member for Wills raised that matter I thought I might just add that response.

This is a housekeeping piece of legislation. It does provide a number of amendments to update, clarify, align and integrate financial management provisions with a number of accounts, plus a number of other minor amendments as well. I commend the bill to the House.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Ordered that the bill be reported to the House without amendment.