Sussan Ley (Farrer, Liberal Party, Parliamentary Secretary to the Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

I move:

That this bill be now read a second time.

The purpose of this bill is to amend the Primary Industries and Energy Research and Development Act 1989.

The amendments follow the government’s endorsement of the assessment by the Minister for Agriculture, Fisheries and Forestry of the statutory rural research and development corporations (RDCs) against the Review of the Corporate Governance of Statutory Authorities and Office Holders (the Uhrig report).

The government commissioned the review by Mr John Uhrig AC to assess the governance arrangements of Commonwealth statutory authorities, with particular focus on those that impacted on the business sector.

The objective of the review was to identify issues surrounding existing governance arrangements and to provide options for government to improve the performance of statutory authorities and office holders, and improve their accountability frameworks.

Individual ministers are responsible for the assessment of statutory agencies in their own portfolios with the Minister for Finance and Administration providing a coordination role.

More than 160 Australian government agencies are being assessed against the Uhrig report principles and templates.

The amendments to the act will give effect to governance improvements for the eight statutory RDCs.

Six of these RDCs cover the cotton; fisheries; forest and wood products; grains; grape and wine; and sugar industries.

Smaller and emerging rural industries are covered by the rural industries research and development corporation.

Natural resource management research and development is covered by Land and Water Australia.

The assessment of the eight statutory RDCs concluded that they should continue to be governed by independent, skills based boards.

Such a governance structure is in line with the board template under the Uhrig report. It ensures the RDCs are best placed to enhance the partnership between industry and government under the RDC model, the RDCs also determine investment strategies that best meet industry and government priorities and maintain key relationships with an extensive range of primary industry stakeholders and research providers.

However, the current administrative practice of appointing serving public servants as government directors on RDC boards was recognised as not consistent with a skills based approach and is to be discontinued. Instead, the skills set for board selection will be expanded to include expertise in public administration.

This decision will also remove the potential for conflict of interest for serving public servants between their responsibilities to the minister and to the board.

As part of the assessment process, consideration was given to the operational and reporting requirements under the act to achieve the appropriate balance between the minister’s role, effective communications and accountability and the role of the RDC boards.

The interactions of the act with the Commonwealth Authorities and Companies Act 1997 (CAC Act) in regard to accountability and management obligations of the RDCs were also considered.

These considerations gave rise to a number of other amendments to the act that respond to the Uhrig report’s recommendations to improve corporate governance and will improve board expertise, experience and management arrangements.

Two changes to the act in the areas of board selection committees and reporting on selection committee performance will improve governance through providing greater emphasis on the diversity of board membership.

They will also provide a practical response by the government to the recommendations by the recent report of the inquiry into women’s representation on regional and rural bodies of influence. That inquiry as, I recall, was at the table chaired by Judith Troeth. I thank Senator Judith Troeth and panel members Heather Ridout and Dennis Mutton.

These amendments to the act will further strengthen the delivery arrangements for rural industries’ R&D. Together with the seven industry owned rural research and development companies, the eight statutory RDCs operated as a key partnership between the government and industry in delivering more than $541 million in rural research, development and extension in 2005-06.

It is vital that the RDCs meet best practice in their operations. Through the Uhrig report assessment process, the government is helping to strengthen the efficiency and effectiveness with which the RDCs pursue the competitiveness, productivity and sustainability of Australia’s rural industries.

The amendments to the act are part of the broader range of responses to the Uhrig report that are being pursued by the government to improve the governance framework for a number of statutory agencies in the agriculture, fisheries and forestry portfolio.

These include the Australian Pesticides and Veterinary Medicines Authority and the Australian Wine and Brandy Corporation. The legislative amendments to improve their governance framework and performance are due to be considered during the current parliamentary session.

I commend the bill.

Debate (on motion by Ms Plibersek) adjourned.